Consolidated group sales for the first quarter increased 19% to 2,102.0 billion yen(U.S.$19.46 billion), from 1,763.6 billion yen in the same three-month period a year ago.To maximize corporate value and establish an optimum structure for the Matsushita Group, the company commenced a comprehensive collaboration relationship with Matsushita Electric Works, Ltd. (MEW), pursuant to the basic agreement between the two companies signed in December 2003. Matsushita subsequently purchased additional shares of MEW in April 2004. As a result, MEW and its group companies are included in Matsushita’s consolidated financial reporting, beginning in this first quarter of fiscal 2005. Other reasons cited by the company for improved results included strong sales in advance of the Athens Olympics and increased demand for digital equipment. Furthermore, the company’s “V-products,” particularly digital audiovisual (AV) products sold well in both domestic and overseas markets, while home appliances recorded firm sales gains. Of the consolidated group total, domestic sales increased 28% to 1,052.8 billion yen ($9.75 billion), compared with 825.1 billion yen a year ago. Overseas sales were up 12%, to 1,049.2 billion yen ($9.71 billion), from 938.5 billion yen in the first quarter of fiscal 2004. Excluding the effects of currency translation, overseas sales increased 17% from a year ago on a local currency basis2.

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