April 5, 2016

Summary of Consolidated Business Results for the First Three Quarters of Fiscal 2015
For the fiscal year ending May 31, 2016
Toyo Denki Seizo K.K.
Stock Code: 6505
Representative:
Inquiries:

Stock Exchange: 1st Section of the Tokyo Stock Exchange
URL https://www.toyodenki.co.jp
Kenzo Terashima, President
Akira Watanabe, Operating Officer and General Manager, Management Planning
Division
TEL +81-3-5202-8122
Scheduled date of submission of quarterly financial report:
April 8, 2016
Scheduled date of commencement of dividend payments:－
Preparation of quarterly financial report supplemental explanatory materials: Yes
Holding of quarterly financial results briefing:
Yes (for institutional investors andanalysts)
Note: Amounts less than one million yen in financial statements and the supplementary data are rounded down.

1. Consolidated Business Results for the First Three Quarters of Fiscal 2015
(June 1, 2015 to February 29, 2016)(1) Consolidated Operating Results(In millions of yen, except where noted; percentage figures show year-on-year increase or decrease.)

Net Sales
3Q Fiscal 2015
3Q Fiscal 2014

28,64828,856(0.7)%
17.7%

Operating Income

Net Income
Attributable to
Owners of the Parent
330(54.6)%
727
175.4%

Ordinary Income

817
913

(10.5)%
725
164.2%
1,253(Note) Comprehensive income: 3Q Fiscal 2015: (1,625) million yen [－%]

(42.2)%
259.5%

3Q Fiscal 2014: 4,572 million yen [442.4%]

Net Income
per Share (Yen)

Diluted Net Income
per Share (Yen)

6.85
15.08

－
－

3Q Fiscal 2015
3Q Fiscal 2014

(2) Consolidated Financial Position(In millions of yen, except where noted)

Total Assets
53,13253,041

As of February 29, 2016
As of May 31, 2015

Net Assets
22,97824,895

Shareholders’ Equity
Ratio (%)
43.2
46.9

(Reference) Shareholders’ equity: As of February 29, 2016: 22,978 million yen
As of May 31, 2015: 24,895 million yen

2. Dividend Information
1Q

Annual Dividend (Yen)Interim
3Q
Fiscal Year-End
0.00
－
6.00
0.00
－

Fiscal 2014－
Fiscal 2015－
Fiscal 2015－
(Forecast)(Note) Revisions to the most recently announced dividend forecasts: No

6.00

Total
6.00
6.00

3. Consolidated Performance Forecast for Fiscal 2015 (June 1, 2015 to May 31, 2016)(In millions of yen, except where noted; percentage figures show year-on-year increase or decrease.)

Net Sales

Operating Income

Ordinary Income

Full year
41,000
3.5%
1,700
6.5%
1,600 (22.2)%(Note) Revisions to the most recently announced performance forecast: Yes

Net Income
Attributable to
Owners of the
Parent1,000(9.6)%Net Income
per Share
(Yen)
20.75

Notes:(1) Transfers of major subsidiaries during the period (transfers of specified subsidiaries accompanied by changes
in the scope of consolidation): No(2) Application of Special Accounting Practices for the Preparation of Quarterly Consolidated Financial
Statements: No(3) Changes in accounting policies, changes in accounting estimates, and restatement(a) Changes in accounting policies in accordance with revisions to accounting standards and related practices: Yes(b) Any changes other than (a) above: No(c) Changes in accounting estimates: No(d) Restatement: No(4) Shares outstanding (common stock)(a) Number of shares outstanding as of the end of the period (including treasury stock):February 29, 2016: 48,675,000 shares
May 31, 2015: 48,675,000 shares(b) Number of shares of treasury stock as of the end of the period:
February 29, 2016: 492,581 shares
May 31, 2015: 484,737 shares(c) Average number of shares for the period (fiscal year-to-date):
3Q Fiscal 2015: 48,185,997 shares
3Q Fiscal 2014: 48,196,049 shares
Statements Regarding the Implementation Status of Quarterly Review ProceduresThis quarterly financial report is not subject to quarterly review procedures as prescribed under the Financial
Instruments and Exchange Act. As of the date of quarterly financial report disclosure, quarterly review proceduresfor the quarterly financial statements pursuant to the aforementioned Act were not yet completed.
Disclaimer concerning the Proper Use of Business Results Forecasts and Other Relevant Specific Items
The forecasts of business results presented in this document are based on management’s assumptions and beliefs inlight of currently available information. Toyo Denki Seizo K.K. (hereinafter Toyo Denki) cautions readers that due
to a variety of factors actual results may differ materially from forecasts. Please refer to “Explanation ofConsolidated Performance Forecast and Other Forward-looking Information” in Accompanying Materials on page
3 for details relating to operating results forecasts.

Accompanying Materials Contents
1.

Qualitative Information regarding Quarterly Financial Results ...................................................................... 2(1) Explanation of Business Results ..................................................................................................................... 2(2) Explanation of Financial Position ................................................................................................................... 3(3) Explanation of Consolidated Performance Forecast and Other Forward-looking Information ...................... 3
2.
Items regarding Summary Information (Notes) .............................................................................................. 4(1) Transfer of Major Subsidiaries during the Period ........................................................................................... 4(2) Application of Special Accounting Practices for the Preparation of
Quarterly Consolidated Financial Statements ................................................................................................. 4(3) Changes in Accounting Principles, Changes in Accounting Estimates, and Retrospective Restatements...... 4
3.
Consolidated Financial Statements ................................................................................................................. 5(1) Consolidated Balance Sheets .......................................................................................................................... 5(2) Consolidated Statements of Income and Comprehensive Income .................................................................. 7(3) Notes to Quarterly Consolidated Financial Statements................................................................................... 9(Notes on Going Concern Assumptions) ................................................................................................... 9(Notes on Significant Fluctuations in Shareholders’ Equity) .................................................................... 9(Segment Information) .............................................................................................................................. 94.
Supporting Materials for the Financial Results ............................................................................................. 10(1) The Status of Production, Orders, and Sales.................................................................................................. 10-1-

1. Qualitative Information regarding Quarterly Financial Results(1) Explanation of Business Results
During the first three quarters (June 1, 2015 to February 29, 2016) of fiscal 2015, the fiscal year ending May 31,
2016, the economic environment surrounding the Toyo Denki Group faced an increasingly uncertain outlook. With
regard to overseas, the slowdown in economic growth in China and emerging countries became more apparent,
leading to a decline in resource prices and also impacting financial capital markets, although the economy in the
United States continued to recover, as evidenced by an improvement in the employment situation. In Japan,
business sentiment became cautious due to a retreat into negative growth rate of the nominal GDP during the
October to December 2015 quarter, effects from the rapid appreciation of the yen and the slowing economic growthin China and emerging countries.
Although investments in railway infrastructure in China, Asia, and Middle Eastern countries remained at a highlevel, the rate of expansion slowed.
Under these circumstances, the Toyo Denki Group has been working in unison to thoroughly strengthen its
management foundation and drastically improve its corporate value according to “Next 100: Beyond 100 years,”
the medium-term management plan which will be completed in the fiscal year ending May 31, 2017.
The Toyo Denki Group’s performance in the first three quarters of fiscal 2015, the second fiscal year of the plan,
was as follows.
Orders received decreased 3.4% compared with the corresponding period of the previous fiscal year to 28,260
million yen. This overall result reflected a decrease in the Industrial Systems segment, although the Transportations
Systems segment posted a slight increase.
Net sales decreased 0.7% year on year to 28,648 million yen, reflecting a slight decrease in the Transportation
Systems segment despite a slight increase in the Industrial Systems segment.
From a profit perspective, operating income decreased 10.5% compared with the corresponding period of theprevious fiscal year to 817 million yen, mainly due to decreased profit in the Transportation Systems segment andthe Information Equipment Systems segment, despite increased profit in the Industrial Systems segment. Primarily
due to the posting of loss on foreign currency exchange, ordinary income decreased 42.2%, recording 725 million
yen, and net income attributable to owners of the parent decreased 54.6% to record 330 million yen.
Information by business segment is presented as follows.
Transportation Systems
Orders received increased 3.0% compared with the corresponding period of the previous fiscal year to 19,853
million yen, led by an upturn in Japan.
Net sales in this segment totaled 19,282 million yen, a 3.0% decrease from the corresponding period of theprevious year, due to a decrease outside Japan, despite an increase in Japan.
Segment profit decreased 15.1% compared with the corresponding period of the previous fiscal year to 1,789
million yen.
Industrial Systems
Orders received decreased 16.7% compared with the corresponding period of the previous fiscal year to 7,632
million yen due to decreased orders for testing equipment for automotive development, production facilities, andsocial infrastructures.
Net sales increased 7.6% year on year to 8,709 million yen as sales of testing equipment for automotive
development increased, despite a decrease in those for social infrastructure.
Segment profit totaled 823 million yen, a 61.0% increase compared with the corresponding period of theprevious fiscal year.
Information Equipment Systems
Orders received in this segment decreased 6.9% to 769 million yen, due to decreases both in railway station
operating equipment and remote monitoring systems.
Net sales in this segment decreased 25.6% year on year to 651 million yen due to decreases in sales of bothrailway station operating equipment and remote monitoring systems.
Segment profit decreased 76.1% compared with the corresponding period of the previous fiscal year to 18
million yen.
-2-

Note: Net sales data by business segment represents sales to third parties and is exclusive of inter-segment sales andtransfers.

-3-(2) Explanation of Financial Position(Assets)
Total assets as of February 29, 2016 stood at 53,132 million yen, an increase of 90 million yen compared withthe end of the previous fiscal year. Despite decreases in cash and cash equivalents of 486 million yen andinvestment securities of 2,951 million yen attributable to factors such as the decrease in the market price of held
listed securities, the increase in total assets was largely attributable to increases in trade notes and accounts
receivable of 1,811 million yen and inventories of 1,043 million yen.
(Liabilities)
Total liabilities as of February 29, 2016 amounted to 30,154 million yen, an increase of 2,008 million yen
compared with the previous fiscal year end. Despite decreases in income taxes payable of 565 million yen, reservefor employees’ bonuses of 456 million yen, and deferred tax liabilities of 869 million yen, the increase in total
liabilities was largely attributable to increases in borrowings of 3,143 million yen and trade notes and accounts
payable of 826 million yen.
(Net assets)
Net assets as of February 29, 2016 stood at 22,978 million yen, 1,917 million yen less than the balance as of theprevious fiscal year end, which was largely attributable to a decrease in unrealized holding gain on available-forsale securities of 2,021 million yen.
(3) Explanation of Consolidated Performance Forecast and Other Forward-looking Information
The consolidated performance for the first three quarters of fiscal 2015 was generally steady up to the first half offiscal 2015. From the third quarter however, in the transportation systems segment a partial delay in orders received
outside Japan until the following quarter was confirmed and design costs associated with an increase in new orders
were anticipated. In the industrial systems segment the environment for orders received showed signs of weakness
due to changes in business sentiment for capital investment. As a result, the “Consolidated Performance Forecast
for Fiscal 2015” announced on July 10, 2015 was revised as follows: net sales to 41,000 million yen, net income to
1,700 million yen, ordinary income to 1,600 million yen as the result of a firm forecast for a loss on foreign
currency exchange due to the rapid appreciation of the yen against the dollar, and net income attributable to ownersof the parent to 1,000 million yen.

-4-

2. Items regarding Summary Information (Notes)(1) Transfer of Major Subsidiaries during the Period
Not applicable(2) Application of Special Accounting Practices for the Preparation of Quarterly Consolidated Financial Statements
Not applicable(3) Changes in Accounting Principles, Changes in Accounting Estimates, and Retrospective Restatements
Changes in Accounting Policies“Accounting Standard for Business Combinations (ASBJ Statement No. 21 of September 13, 2013) and“Accounting Standard for Consolidated Financial Statements (ASBJ Statement No. 22 of September 13, 2013), and“Accounting Standard for Business Divestitures (ASBJ Statement No. 7 of September 13, 2013) and others havebeen applied from the first quarter of fiscal 2015. Along with this application, presentation method regarding net
income and others has been revised, and minority interests has been revised to non-controlling interests as well. To
reflect these changes in presentation, consolidated financial statements for the first three quarters of fiscal 2014 andfor the full year of fiscal 2014 ended May 31, 2015 have been reclassified.

-5-

3. Consolidated Financial Statements(1) Consolidated Balance Sheets(Millions of yen)
As of May 31, 2015

End of the First Three Quarters of
Fiscal 2015 (February 29, 2016)

AssetsCurrent assets
Cash and cash equivalents

3,570

3,084

Trade notes and accounts receivable

14,83816,650

Products and finished goods

1,283

1,271

Work in process

2,962

3,481

Raw materials and stored goods

2,149

2,685

828

1,253

Other
Allowance for doubtful accounts
Total current assets

(40)

(2)

25,59328,424

Fixed assets
Property, plant and equipment

7,058

7,150

Accumulated depreciation(4,320)(4,488)

Buildings and structures, net

2,737

2,662

Buildings and structures

Machinery and equipment
Accumulated depreciation
Machinery and equipment, net
LandConstruction in progress
Other
Accumulated depreciation

6,792

6,961

(5,930)(6,154)

862

807

289

289

227

235

3,272

3,386

(2,786)(2,914)

486

471

4,603

4,466

Software

204

198

Other

144

309

Total intangible assets

348

508

Investment securities

20,326

17,374

Other

2,180

2,370

Other, net
Total property, plant and equipment
Intangible assets

Investments and other assets

Allowance for doubtful accounts

(12)

(12)

Total investments and other assets

22,495

19,73227,447

24,70853,04153,132

Total fixed assets
Total assets-6-

(Millions of yen)
As of May 31, 2015

End of the First Three Quarters of
Fiscal 2015 (February 29, 2016)

Trade notes and accounts payable

5,116

3,911

Electronically recorded obligations - operating

3,022

5,053

Short-term debt

1,783

5,223

Income taxes payable

652

86

Consumption and other taxes payable

249

44

Accrued expenses

992

1,175

Advances received

288

323

Deposits received

230

212

Reserve for directors’ bonuses

41

32

Reserve for employees’ bonuses

927

471

Reserve for order losses

301

272

Liabilities
Current liabilities

Allowance for environmental development

65

-

Other

307

299

13,97917,108

7,640

7,343

141

156

Net defined benefit liability

3,725

3,759

Deferred tax liabilities

2,618

1,749

40

37

14,166

13,04528,14530,154

Capital stock

4,998

4,998

Capital surplus

3,177

3,177

Retained earnings

8,698

8,739

Treasury stock

(171)

(175)

Total shareholders’ equity

16,702

16,740

8,317

6,295

Total current liabilities
Long-term liabilities
Long-term debt
Long-term payables

Other
Total long-term liabilities
Total liabilities
Net assets
Shareholders’ equity

Accumulated other comprehensive income
Unrealized holding gain on available-for-sale securities
Foreign currency translation adjustments

259

290

Remeasurements of defined benefit plans

(383)

(348)

Total accumulated other comprehensive income
Total net assets
Total liabilities and net assets

-7-

8,193

6,237

24,89522,97853,04153,132

(2) Consolidated Statements of Income and Comprehensive Income(Consolidated Statements of Income for the First Three Quarters of Fiscal 2015)(Millions of yen)
3Q FY2014(June 1, 2014 to February 28, 2015)

3Q FY2015(June 1, 2015 to February 29, 2016)

Net sales

28,85628,648

Cost of sales

22,243

22,272Gross profit

6,612

6,375

Selling, general and administrative expenses

5,699

5,558

913

817

Operating income
Non-operating income

30Dividend income
Equity in profit of unconsolidated subsidiaries andaffiliates
Life insurance dividend income

202

221

-

65

6

40

Foreign exchange gains

258-

Miscellaneous income

2436

Total non-operating income

494

364

104

95

9

-

Interest income

Non-operating expenses
Interest expense
Equity in loss of unconsolidated subsidiaries andaffiliates
Loss on disposal of fixed assets
Loss on foreign currency exchange

1

5

-

340

Miscellaneous loss

38

16

Total non-operating expenses

154

456

1,253

725

Gain on sales of fixed assets

12-

Total extraordinary income

12-

Fixed assets removal expenses-

72

Loss on sales of investment securities-

11

Total extraordinary loss-

83

Income before income taxes

1,266

641

Current

550

176

Deferred

(10)

134

Total income taxes

539

311

Net income

727

330

Net income attributable to owners of the parent

727

330

Ordinary income
Extraordinary income

Extraordinary loss

Income taxes:-8-

(Consolidated Statements of Comprehensive Income for the First Three Quarters of Fiscal 2015)(Millions of yen)
3Q FY2014(June 1, 2014 to February 28, 2015)

3Q FY2015(June 1, 2015 to February 29, 2016)

727

330

3,656

(2,021)

Net income
Other comprehensive income
Unrealized holding gain (loss) on available-for-salesecurities
Deferred gains or losses on hedges

26-

Foreign currency translation adjustments

1664

Remeasurements of defined benefit plans
Share of other comprehensive income of affiliates towhich the equity method is applied
Total other comprehensive income

126

35

19

(33)

3,845

(1,955)

4,572(1,625)

4,572(1,625)--Comprehensive income
Comprehensive income attributable to:
Owners of the parent
Non-controlling interests-9-(3) Notes to Quarterly Consolidated Financial Statements(Notes on Going Concern Assumptions)Not applicable.
(Notes on Significant Fluctuations in Shareholders’ Equity)
Not applicable.
(Segment Information)
The First Three Quarters of Fiscal 2014 (June 1, 2014 to February 28, 2015)
Information regarding Net Sales and Income (Loss) by Reporting Segment
Reporting Segment(Millions of yen)AmountRecorded on
Adjustment
Quarterly
Amount2
Consolidated
Statementsof Income3

Transportation
Systems

Industrial
Systems

Information
Equipment
Systems

Other1

Total

19,878

8,096

876

4

28,856—28,856

31

0

—

435

467

(467)

—

Net sales
Sales to third parties
Inter-segment sales
and transfers

Total
19,9098,097
876
439 29,323(467)
28,856
Segment profit
2,107
511
79
41
2,738
(1,825)913
Notes:
1. The “Other” segment includes operations not included in reporting segments such as the dispatch of temporary
staff.
2. The segment profit adjustment amount is a loss of 1,825 million yen. This is comprised of an elimination ofinter-segment sales and transfer amount of 1 million yen and corporate expenditure (a loss of 1,824 million
yen) that is not allocated to each reporting segment. Corporate expenditure is primarily comprised of selling,
general and administrative expenses as well as research and development costs that are not allocated to eachreporting segment.
3. Segment profit has been adjusted with operating income recorded under the quarterly consolidated statements
of income.

- 10 -

The First Three Quarters of Fiscal 2015 (June 1, 2015 to February 29, 2016)
Information regarding Net Sales and Income (Loss) by Reporting Segment
Reporting Segment(Millions of yen)AmountRecorded on
Adjustment
Quarterly
Amount2
Consolidated
Statementsof Income3

Transportation
Systems

Industrial
Systems

Information
Equipment
Systems

Other1

Total

19,282

8,709

651

4

28,648—28,648

27

3

—

422

453

(453)

—

Net sales
Sales to third parties
Inter-segment sales
and transfers

Total
19,3108,712
651
427 29,102(453)
28,648Segment profit
1,789
823
18
10
2,643
(1,825)817
Notes:
1. The “Other” segment includes operations not included in reporting segments such as the dispatch of temporary
staff.
2. The segment profit (loss) adjustment amount is a loss of 1,825 million yen. This is comprised of anelimination of inter-segment sales and transfer amount of 0 million yen and corporate expenditure (a loss of
1,826 million yen) that is not allocated to each reporting segment. Corporate expenditure is primarily
comprised of selling, general and administrative expenses as well as research and development costs that are
not allocated to each reporting segment.
3. Segment profit (loss) has been adjusted with operating income recorded under the quarterly consolidated
statements of income.

- 11 -

4. Supporting Materials for the Financial Results(1) The Status of Production, Orders, and Sales(a) Production Status
3Q FY2014(June 1, 2014 to February 28, 2015)
Business segment
Millions of yen
Share (%)
Transportation Systems
19,98970.6
Industrial Systems
7,778
27.5
Information Equipment
526
1.9
Systems
Other
―
―
Total
28,294100.0
Notes:
1. Amounts are based on sales prices.
2. Amounts are exclusive of consumption and other taxes.

3Q FY2015(June 1, 2015 to February 29, 2016)
Millions of yen
Share (%)
19, 245
68.2
8,563
30.3

428

1.5

—
28,237—100.0(b) Status of Orders Received
Business segment

3Q FY2014(June 1, 2014 to February 28, 2015)
Orders Received
Balance(Millions of yen)
(Millions of yen)
19,26925,0399,162
5,994

Transportation Systems
Industrial Systems
Information Equipment
826
190
Systems
Other
4
—
Total
29,26331,224
Notes:
1. Amounts are based on sales prices.
2. Amounts are exclusive of consumption and other taxes.

3Q FY2015(June 1, 2015 to February 29, 2016)
Orders Received
Balance(Millions of yen)
(Millions of yen)
19,85324,997
7,632
5,557

769

215

4
28,260―30,770(c) Sales Status
Business segment

3Q FY2014(June 1, 2014 to February 28, 2015)
Millions of yen
Share (%)
19,878
68.9
8,096
28.1

Transportation Systems
Industrial Systems
Information Equipment876
3.0
Systems
Other
4
0.0
Total
28,856100.0
Notes:
1. Amounts are based on sales prices.
2. Amounts are exclusive of consumption and other taxes.

- 12 -

3Q FY2015(June 1, 2015 to February 29, 2016)
Millions of yen
Share (%)
19,282
67.3
8,709
30.4

651

2.3

4
28,6480.0
100.0