Beginning November 2006 PHCP, Inc., a lead-frame manufacturing subsidiary of Hitachi Cable, Ltd. in the Philippines, will start operation of a series of new facilities as it expands production capacity to respond to growing demand for IC lead frames in Asia.
By firmly capturing demand centered on Asian markets, the Hitachi Cable Group seeks to expand sales in its lead-frame business from 19.2 billion yen in fiscal 2006 to 25 billion yen in fiscal 2009.

Lead frames are multipurpose semiconductor packaging materials. The market for lead frames is projected to see strong growth in China and other regions of Asia. In response to such projections, the Hitachi Cable Group has built a structure suited to handling worldwide demand, with efforts including designating Hitachi Cable Precision Co., Ltd. (HCPJ, headquartered in Yonezawa, Yamagata Pref., Japan) as the supervising company in the lead-frame business, designating PHCP, Hitachi Cable PS Techno (Malaysia) Sdn. Bhd. (in Malaysia), and Hitachi Cable Asia Pacific Pte. Ltd. (in Singapore) to handle mass production of lead frames, and establishing Hitachi Cable (Suzhou) Precision Co., Ltd. in China in January 2005.

Of these companies, PHCP in particular has been evaluated highly by customers for its own unique high-precision plating technologies and its cost competitiveness, and its business performance steadily continues to improve as it grows into its role as a pivotal base for the lead-frame business in Asia.
This expansion of PHCP's production capacity will strengthen its production of mid-pin-count (approximately 100 pins or less) and low-pin-count (approximately 54 pins or less) IC lead frames, which promise particularly high growth rates of approximately 10% per year.
In addition to the construction of a new plant costing approximately 400 million yen on PHCP's own grounds, some mid-pin-count lead-frame manufacturing facilities will be transferred from HCPJ to PHCP. This is expected to increase PHCP's overall lead-frame production capacity in fiscal 2008, when the new facilities will fully come on line, to 1.3 times the fiscal 2006 level, and to increase sales by 1.7 times over the fiscal 2006 level. Until now, PHCP's product lineup has centered on low-pin-count products. However, the company faces an urgent need to expand its mid-pin-count lead-frame business, since the market for such products is expected to grow in the future and such products have high levels of added value. By accepting the transfer of production facilities from within the Hitachi Cable Group, PHCP will be able to quickly adopt the facilities and accumulate the know-how essential to manufacturing mid-pin-count lead frames.
With this expansion of its production capacity, PHCP will enhance its function as a core unit in the Hitachi Cable Group's manufacture of IC lead frames and contribute to the Group's business development.

In the future as well, the Hitachi Cable Group will work to expand and strengthen its lead-frame business by advancing efforts to manufacture products in the most suitable locations in response to market trends and to improve its development capabilities, through means such as strengthening its ability to develop new products in Japan while expanding its production capacity in the Asia region, which is central to the lead-frame market.

Profile of PHCP

Name	PHCP, Inc.
Location	Cavite, Republic of the Philippines
Representative	President Yuichi Takei
Established: December	1994 (became a subsidiary with investment by the Hitachi Cable Group in April 2004)
Sales	2.3 billion yen (Fiscal 2006)
Capital	100 million pesos (approximately 200 million yen at the March 31, 2006 exchange rate)
Employees	293 (as of March 31, 2006)
Shareholders	HCPJ: 70% Hitachi Cable Asia Pacific Pte. Ltd.: 30%