January 14, 2015

Summary of Consolidated Business Results for the First Half of Fiscal 2014
For the fiscal year ending May 31, 2015
Toyo Denki Seizo K.K.
Stock Code: 6505
Representative:
Inquiries:

Stock Exchange: 1st Section of the Tokyo Stock Exchange
URL http://www.toyodenki.co.jp
Kenzo Terashima, President
Yoshifumi Otsubo, Operating Officer and General Manager, Management Planning
Division
TEL +81-3-5202-8122
Scheduled date of submission of quarterly financial report:
January 14, 2015
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 Half of Fiscal 2014
(June 1, 2014 to November 30, 2014)(1) Consolidated Operating Results(In millions of yen, except where noted; percentage figures show year-on-year increase or decrease.)

Net Sales
Operating Income
Ordinary Income
First half, Fiscal 2014
19,065
20.5%
584
174.0
873
223.4
First half, Fiscal 201315,826
16.7%
213
－
270
－
(Note) Comprehensive income: 1H Fiscal 2014: 2,841 million yen [288.7%]
1H Fiscal 2013: 731 million yen [369.6%]

First half, Fiscal 2014
First half, Fiscal 2013

Net Income
per Share (Yen)
10.69
1.20

Net Income
515
790.7
57
－

Diluted Net Income
per Share (Yen)－－(2) Consolidated Financial Position(In millions of yen, except where noted)

Total Assets
As of November 30, 2014
As of May 31, 2014
(Reference) Shareholders’ equity:

Net Assets

50,67544,752

22,27019,350Shareholders’Equity Ratio (%)
43.9
43.2

As of November 30, 2014: 22,270 million yen
As of May 31, 2014: 19,350 million yen

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

1Q
Fiscal 2013－
Fiscal 2014－
Fiscal 2014－
(Forecast)(Note) Revisions to the most recently announced dividend forecasts: No

6.00

Total
6.00
6.00

3. Consolidated Performance Forecast for Fiscal 2014 (June 1, 2014 to May 31, 2015)(In millions of yen, except where noted; percentage figures show year-on-year increase or decrease.)

Net Sales

Operating Income

Ordinary Income

Full year
40,000 14.4%
1,800
67.3%
2,100 102.7%(Note) Revisions to the most recently announced performance forecast: Yes

Net Income
1,200

86.2%

Net Income
per Share
(Yen)
24.89

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):
November 30, 2014: 48,675,000 shares
May 31, 2014: 48,675,000 shares(b) Number of shares of treasury stock as of the end of the period:
November 30, 2014: 481,094 shares
May 31, 2014: 474,527 shares(c) Average number of shares for the period (fiscal year-to-date):
First half, Fiscal 2014: 48,197,225 shares First half, Fiscal 2013: 48,208,868 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, a quarterly review report on
the quarterly financial statements pursuant to the aforementioned Act has been received.
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.
Quarterly Consolidated Financial Statements ................................................................................................. 5(1) Quarterly Consolidated Balance Sheets .......................................................................................................... 5(2) Quarterly Consolidated Statements of Income and Comprehensive Income .................................................. 7(3) Quarterly Consolidated Statements of Cash Flows ......................................................................................... 9(4) Notes to Quarterly Consolidated Financial Statements................................................................................. 10(Notes on Going Concern Assumptions) ................................................................................................. 10(Notes on Significant Fluctuations in Shareholders’ Equity) .................................................................. 10(Segment Information) ............................................................................................................................ 10
4.
Supporting Materials for the Financial Results ............................................................................................. 12(1) The Status of Production, Orders, and Sales ................................................................................................. 12-1-

1. Qualitative Information regarding Quarterly Financial Results(1) Explanation of Business Results
During the first half (June 1, 2014 to November 30, 2014) of fiscal 2014, the fiscal year ending May 31, 2015,
significant effects to the economy in Japan were seen due to the decline in reaction to last-minute demand
accompanying the increase in the consumption tax rate, and subdued conditions persisted for capital expenditures.
However, a recovery trend continued and signs of a recovery in demand were seen due to improvement in corporate
and personal incomes, backed by the economic policies and monetary easing policy of the current administration.
Meanwhile, with regard to overseas, although economic trends in Europe were weak, the recovery trend of theeconomy in the United States continued, and China secured growth amid a decelerating growth rate, leading to ahigh level of investment in infrastructure. These overseas conditions are expected to continue for the foreseeable
future.
Under these circumstances, the Toyo Denki Group has been working in unison to thoroughly strengthen its
management foundation and drastically improve its corporate value by (1) strengthening its international
competitiveness, (2) building a stable business earnings structure, and (3) promoting development of technology, allaccording to “Next 100 : Beyond 100 years,” the medium-term management plan launched in July 2014.
The Toyo Denki Group’s performance in the first half of fiscal 2014, the first fiscal year of the plan, was asfollows.
Orders received increased 7.4% compared with the corresponding period of the previous fiscal year to 19,608
million yen. This overall result reflected a surge in orders received in the Transportation Systems segment both
inside and outside Japan, despite a decrease in the Industrial Systems segment and the Information Equipment
Systems segment.
Net sales increased 20.5% year on year to 19,065 million yen. Despite a decrease in the Information Equipment
Systems segment, this result reflected a significant surge centered on the Transportation Systems segment outside
Japan as well as an increase in the Industrial Systems segment.
From a profit perspective, operating income increased 174.0% compared with the corresponding period of theprevious fiscal year to 584 million yen, mainly due to higher revenues in the Transportation Systems segment andthe Industrial Systems segment. Ordinary income grew by 223.4% to 873 million yen as a result of recording
foreign exchange gains from a progressively weaker yen, and net income increased by 790.7% to 515 million yen.
Looking at the overall nature and structure of the Group’s business activities, sales are generally concentrated in
the fourth quarter of each fiscal year. As a result, quarterly consolidated operating results are impacted by seasonal
factors.
Information by business segment is presented as follows.
Transportation Systems
Orders received were up both in Japan and outside Japan, leading to an increase of 18.2% compared with thecorresponding period of the previous fiscal year to 12,557 million yen.
Although net sales in this segment were flat in Japan, there was a significant upturn outside Japan, totaling
13,031 million yen, a 32.2% increase from the corresponding period of the previous year.
Segment profit increased by 27.0% compared with the corresponding period of the previous fiscal year to 1,351
million yen, which was attributable to increased revenue.
Industrial Systems
While orders received for infrastructure related were robust, orders related to capital expenditure such as printing
equipment and processing equipment, along with testing equipment for automotive development, remained at low
levels, causing a 2.0% decline compared with the corresponding period of the previous fiscal year to 6,458 million
yen.
Net sales increased 6.3% year on year to 5,666 million yen primarily as sales of testing equipment for
automotive development increased.
Segment profit totaled 414 million yen, an increase of 140.4% compared with the corresponding period of theprevious fiscal year due to effect of increased revenue and improved profitability.

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Information Equipment Systems
Orders received in this segment decreased 43.0% to 589 million yen, primarily due to declines in orders for railway
station operating equipment and remote monitoring systems.
Net sales in this segment decreased 42.1% year on year to 364 million yen, owing to the same reasons as above.
Segment profit was 18 million yen, an increase of 7.1% compared with the corresponding period of the previous
fiscal year due to improved profitability.
Note: Net sales data by business segment represents sales to third parties and is exclusive of inter-segment sales andtransfers.
(2) Explanation of Financial Position
Total assets as of November 30, 2014 stood at 50,675 million yen, an increase of 5,922 million yen compared withthe end of the previous fiscal year. The increase in total assets was largely attributable to increases in cash and cash
equivalents of 512 million yen, trade notes and accounts receivable of 1,593 million yen, and investment securitiesof 3,514 million yen.
Total liabilities amounted to 28,404 million yen, an increase of 3,002 million yen compared with the previous
fiscal year end. Despite a 533 million yen decrease in net defined benefit liability, the increase in total liabilities
was largely attributable to increases in borrowings of 1,223 million yen, accrued expenses of 664 million yen, andadvances received of 186 million yen.
Net assets stood at 22,270 million yen, 2,920 million yen higher than the balance as of the previous fiscal year
end. Major movements were a 2,269 million yen increase in unrealized holding gain on available-for-sale securities
and a 596 million yen increase in retained earnings.
(3) Explanation of Consolidated Performance Forecast and Other Forward-looking Information
Consolidated performance during the first half of fiscal 2014 saw ordinary income and net income significantly
exceeded previous forecasts due to the recording of 250 million yen in foreign exchange gains as non-operating
income, despite net sales and operating income that were in line with previous forecasts.
However, concerning the consolidated performance forecast for the full year, it has become apparent thatconditions will differ from initial expectations due to factors such as continued prior recording of development
expenses and design expenses in the Transportation Systems segment to accommodate an increase in new projects,
delayed progress in recovery of profitability in the Industrial Systems segment, and difficult conditions in acquiring
orders in the Information Equipment Systems segment. As a result, the forecast for operating income has been
lowered by 300 million yen when compared to the previous forecast, to 1,800 million yen. Concerning ordinary
income and net income, foreign exchange gains on a par with those recorded during the first half of fiscal 2014 arealso expected during the second half, and full year forecasts therefore remain unchanged from previous forecasts, at
2,100 million yen and 1,200 million yen, respectively.

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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(Application of Accounting Standard for Retirement Benefits)
Provisions stated in Section 35 of the “Accounting Standard for Retirement Benefits” (ASBJ Statement No. 26 of
May 17, 2012; hereinafter referred to as the “Retirement Benefits Accounting Standard”) and Section 67 of the“Guidance on the Accounting Standard for Retirement Benefits” (ASBJ Guidance No. 25 of May 17, 2012;
hereinafter referred to as the “Guidance on Retirement Benefits”) have been applied from the first quarter of fiscal
2014. Along with this application, calculation methods for retirement benefit obligations and service cost have beenrevised. Furthermore, the method for determining the portion of projected benefit obligation attributed to periods
was changed from the straight-line method to the benefit formula basis. In addition, the method of determining thediscount rates applied in the calculation of projected benefit obligation was changed from the method using thenumber of years approximate to the average remaining service period of employees to the method using the single
weighted average discount rate that reflects the estimated period and amount of benefit payment in each period.
In accordance with the transitional treatment prescribed in Section 37 of the Retirement Benefits AccountingStandard, the Company applied the Accounting Standard for Retirement Benefits at the beginning of the first halfof fiscal 2014, and the effect of the accounting change in retirement benefit obligations and service cost wasreflected in retained earnings.
As a result, net defined benefit liability decreased by 576 million yen, and retained earnings increased by 370
million yen at the beginning of the first half of fiscal 2014. The impact on operating income, ordinary income andincome before income taxes and minority interests recorded for the first half of fiscal 2014 is immaterial.

-4-3. Quarterly Consolidated Financial Statements(1) Quarterly Consolidated Balance Sheets(Millions of yen)
As of May 31, 2014

End of the First Half of Fiscal 2014
(November 30, 2014)

AssetsCurrent assets
Cash and cash equivalents

2,997

3,510

Trade notes and accounts receivable

12,805

14,398

Products and finished goods

1,483

1,806

Work in process

3,459

3,368

Raw materials and stored goods

2,158

2,196

684

942

Other
Allowance for doubtful accounts
Total current assets

(34)

(40)

23,55526,182

Fixed assets
Property, plant and equipment

7,075

7,086

Accumulated depreciation(4,228)(4,340)

Buildings and structures, net

2,847

2,745

Buildings and structures

Machinery and equipment
Accumulated depreciation
Machinery and equipment, net
LandConstruction in progress
Other
Accumulated depreciation
Other, net
Total property, plant and equipment

6,679

6,684

(5,770)(5,807)

908

877

289

289

63

74

3,171

3,219

(2,624)(2,684)

547

534

4,656

4,521

230

206

Intangible assets
Software
Other

37

52

Total intangible assets

268

258

Investment securities

14,262

17,777

Other

2,022

1,946

Investments and other assets

Allowance for doubtful accounts

(12)

(12)

Total investments and other assets

16,273

19,711

21,197

24,49244,75250,675

Total fixed assets
Total assets-5-

(Millions of yen)
As of May 31, 2014

End of the First Half of Fiscal 2014
(November 30, 2014)

Trade notes and accounts payable

5,285

5,191

Short-term debt

1,987

2,110

374

542

Liabilities
Current liabilities

Income taxes payable

180

84

Accrued expenses

3,792

4,456

Advances received

292

479

Deposits received

228

231

Consumption and other taxes payable

Reserve for directors’ bonuses

28

14

Reserve for employees’ bonuses

915

799

Reserve for order losses

129

309

Other

281

279

13,496

14,498

6,934

8,035

145

143

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

43

43

4,044

3,511

737

2,172

11,906

13,90625,402

28,404

Capital stock

4,998

4,998

Capital surplus

3,177

3,177

Retained earnings

7,510

8,107

Treasury stock

(167)

(170)

15,51916,113

3,989

6,259

Allowance for environmental development
Net defined benefit liability
Other
Total long-term liabilities
Total liabilities
Net assets
Shareholders’ equity

Total shareholders’ equity
Accumulated other comprehensive income
Unrealized holding gain on available-for-sale securities
Deferred gains or losses on hedges

(26)

-

Foreign currency translation adjustments

165

112

Remeasurements of defined benefit plans

(298)

(214)

Total accumulated other comprehensive income

3,830

6,157

19,35022,27044,75250,675

Total net assets
Total liabilities and net assets-6-

(2) Quarterly Consolidated Statements of Income and Comprehensive Income(Quarterly Consolidated Statements of Income for the First Half of Fiscal 2014)(Millions of yen)
1H FY2013
1H FY2014(June 1, 2013 to November 30, 2013) (June 1, 2014 to November 30, 2014)
Net sales

15,826

19,065

Cost of sales

12,161

14,692Gross profit

3,664

4,373

Selling, general and administrative expenses

3,451

3,788

213

584

Interest income

01

Dividend income

Operating income
Non-operating income

115

141

Life insurance dividend income

36Foreign exchange gains

36

250

Miscellaneous income

1012

Total non-operating income

167

413

Interest expense
Equity in loss of unconsolidated subsidiaries andaffiliates
Loss on disposal of fixed assets

87

71

13

29

5

1

Miscellaneous loss

3

21

110

124

270

873

Gain on sales of fixed assets-

12

Total extraordinary income

-

12

270

886

Non-operating expenses

Total non-operating expenses
Ordinary income
Extraordinary income

Income before income taxes and minority interests
Income taxes:
Current

273

511

Deferred

(61)

(140)

Total income taxes

212

371

Income before minority interests

57

515

Net income

57

515

-7-

(Quarterly Consolidated Statements of Comprehensive Income for the First Half of Fiscal 2014)(Millions of yen)
1H FY2013
1H FY2014(June 1, 2013 to November 30, 2013) (June 1, 2014 to November 30, 2014)
Income before minority interests

57

515

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

563

2,269

Foreign currency translation adjustments

-

26

6

(12)

-

84

102

(41)

673

2,326

731

2,841

Owners of the parent

731

2,841

Minority interests--

Remeasurements of defined benefit plans
Share of other comprehensive income of affiliates towhich the equity method is applied
Total other comprehensive income
Comprehensive income
Comprehensive income attributable to:-8-(3) Quarterly Consolidated Statements of Cash Flows(Millions of yen)
1H FY2013
1H FY2014(June 1, 2013 to November 30, 2013) (June 1, 2014 to November 30, 2014)
Cash flows from operating activities
Income before income taxes and minority interests

270

886

Depreciation and amortization(Reversal of) provision for allowance for doubtful
accounts
Provision for (reversal of) accrued employees’
bonuses
Provision for accrued retirement benefits

478

417

(124)

6

8

(116)

165

-

-

173

(52)

179

(115)

(143)

87

71

Trade notes and accounts receivable(707)(1,577)

Inventories

(868)

(258)

Trade notes and accounts payable

473

(111)

Advances received

30

186

Accrued expenses

377

661

Other

158

(52)

Subtotal

180324Interest and dividends income received

115

159

Increase in net defined benefit liability(Reversal of) reserve for losses on orderacknowledgements
Interest and dividends income
Interest expenses

Interest expenses paid

(92)

(68)

Payments for corporate and other taxes

(343)

(419)

Net cash used in operating activities

(139)

(4)

(419)

(252)

Cash flows from investing activities
Purchases of property, plant and equipment
Purchases of investment securities

(6)

(6)

Other

(65)

(35)

Net cash used in investing activities

(492)

(294)

Cash flows from financing activities
Increase (decrease) in short-term loans payable

2,075

122

Increase in long-term debt

700

1,500

Repayment of long-term debt

(558)

(544)

Redemption of bonds payable

(60)

-

(1)

(2)

(286)

(286)

(0)

(0)

Net cash provided by financing activities
Effect of exchange rate change on cash and cash
equivalents
Increase (decrease) in cash and cash equivalents

1,867

788

13

23

1,249

512

Cash and cash equivalents at the beginning of the period

1,302

2,997

Cash and cash equivalents at the end of the period

2,551

3,510

Purchase of treasury stock
Cash dividends paid
Other

-9-

(4) Notes to Quarterly Consolidated Financial Statements(Notes on Going Concern Assumptions)Not applicable.
(Notes on Significant Fluctuations in Shareholders’ Equity)
Not applicable.
(Segment Information)(a) The First Half of Fiscal 2013 (June 1, 2013 to November 30, 2013)
Information regarding Net Sales and Income (Loss) by Reporting Segment
Reporting Segment(Millions of yen)AmountRecorded on
Adjustment
Quarterly
Amount2
Consolidated
Statement of
Income3

Transportation
Systems

Industrial
Systems

Information
Equipment
Systems

Other1

Total

Sales to third parties

9,860

5,332

630

2

15,826—

15,826

Inter-segment sales
and transfers

7

0

—

248

256

(256)

—

Net sales

Total
9,868
5,333
630
250 16,082(256)
15,826
Segment profit
1,064
172
17
23
1,277
(1,064)
213
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 1,064 million yen. This is comprised of an elimination ofinter-segment sales and transfer amount of 2 million yen and corporate expenditure (a loss of 1,067 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 -

(b) The First Half of Fiscal 2014 (June 1, 2014 to November 30, 2014)
Information regarding Net Sales and Income (Loss) by Reporting Segment
Reporting Segment(Millions of yen)AmountRecorded on
Adjustment
Quarterly
Amount2
Consolidated
Statement of
Income3

Transportation
Systems

Industrial
Systems

Information
Equipment
Systems

Other1

Total

Sales to third parties

13,031

5,666

364

2

19,065—

19,065Inter-segment sales
and transfers

4

0

—

289

294

(294)

—

Net sales

Total
13,0355,666
364
292 19,359(294)
19,065
Segment profit
1,351
414
18
30
1,815
(1,231)
584
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 1,231 million yen. This is comprised of an elimination ofinter-segment sales and transfer amount of 1 million yen and corporate expenditure (a loss of 1,229 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.

- 11 -

4. Supporting Materials for the Financial Results(1) The Status of Production, Orders, and Sales(a) Production Status
1H FY2013(June 1, 2013 to November 30, 2013)
Business segment
Millions of yen
Share (%)
Transportation Systems
10,27765.5
Industrial Systems
4,958
31.6
Information Equipment
455
2.9
Systems
Other
—
—
Total
15,691100.0
Notes:
1. Amounts are based on sales prices.
2. Amounts are exclusive of consumption and other taxes.

1H FY2014(June 1, 2014 to November 30, 2014)
Millions of yen
Share (%)
13,368
70.8
5,250
27.8
261

1.4

—
18,880—100.0(b) Status of Orders Received
Business segment

1H FY2013(June 1, 2013 to November 30, 2013)
Orders Received
Balance(Millions of yen)
(Millions of yen)
10,622
18,8176,592
6,015

Transportation Systems
Industrial Systems
Information Equipment
1,034
799
Systems
Other
2
—
Total
18,251
25,632
Notes:
1. Amounts are based on sales prices.
2. Amounts are exclusive of consumption and other taxes.

1H FY2014(June 1, 2014 to November 30, 2014)
Orders Received
Balance(Millions of yen)
(Millions of yen)
12,55725,174
6,458
5,720
589

465

2
19,608—31,360(c) Sales Status
Business segment

1H FY2013(June 1, 2013 to November 30, 2013)
Millions of yen
Share (%)
9,860
62.3
5,332
33.7

1H FY2014(June 1, 2014 to November 30, 2014)
Millions of yen
Share (%)
13,031
68.4
5,666
29.7

Transportation Systems
Industrial Systems
Information Equipment
630
4.0
364
1.9
Systems
Other
2
0.0
2
0.0
Total
15,826100.0
19,065100.0
Notes:
1. Amounts are exclusive of consumption and other taxes.
2. Looking at the overall nature and structure of the Group business activities, sales are generally concentrated in
the fourth quarter of each fiscal year. As a result, quarterly consolidated operating results are impacted byseasonal factors.

- 12 -