Acrylic Products Despite progress in raising the selling prices of acrylic esters to compensate for the high price of naphtha, shipments from our Singapore subsidiary to Asian markets declined, and demand in the Japanese market fell sharply toward the end of the year. Total sales declined on a year-on-year comparison. Sales of acrylic polymers posted a year-on-year decline despite increased sales of value-added items and the implementation of selling price raises, owing to our withdrawal from certain unprofitable products and an overall weakening of demand toward the end of the reporting term. Sales of products for use in building construction and civil engineering posted an increase thanks to a larger volume of orders. Polymer flocculants recorded a sharp increase in sales on the back of brisk shipments to users in Japan and overseas, as well as the successful renegotiation of selling prices. Total sales for the Acrylic Products segment rose 4.9% year-onyear, to \51,057 million. Operating income, however, declined by 18.8% to \1,379 million. Specialty Chemicals Sales of industrial adhesives to manufacturers of smart cards, flexible plastic substrates, and so on were favorable, but sales in the United States of products for general consumer use were weak, and total sales of this category declined year-on-year. Sales of the UV-curable resin Aronix registered a year-on-year decrease, despite renegotiated selling prices, owing to a lower shipment volume to certain large-lot users. In the category of products developed in-house, despite a decline in demand toward the year-end, the Company enjoyed brisk shipments of high-purity industrial silicon gases, and total sales of this category rose over the previous year. Total sales for the Specialty Chemicals segment came to \24,380 million, for a year-on-year decline of 8.6%, while operating income for the segment was down 7.6% year-on-year, at \3,906 million. Plastics Although the reporting term largely saw an end to the delays in housing construction starts . caused by the amended building standard law . that had been seen in the previous term, the worsening of the economic downturn led to a major decline in sales. Sales of plastic products for day-to-day household use and for use in nursing care posted a year-on-year increase thanks to growth in demand from the nursing care field. Sales of raw material compounds and other molding materials recorded a year-on-year decline in spite of higher selling prices and the development of new applications. This was due to lower shipments of elastomer compounds as a result of user production cutbacks. Total sales for the Plastics segment came to \30,550 million for a year-on-year fall of 5.2%, while operating income was down sharply, by 41.4% to \1,299 million. ■ Capital expenditures ■ Depreciation and amortization expenditures 0 2,500 5,000 7,500 10,000 (Millions of yen) 04 05 06 07 08 Capital expenditures & depreciation and amortization expenditures 0 1,500 3,000 4,500 6,000 (Millions of yen) 04 05 06 07 08 R&D expenditures Toagosei Co., Ltd. 23