PAGETOKYO ELECTRON ANNUAL REPORT 201622CONTENTS

To Our Stakeholders

Business Overview

Financial Review

Medium-term Management PlanInterview with the CEO

Consolidated Eleven-Year Summary

Consolidated Statements of Changes in Net Assets

Review of Operations
and Business Outlook

Consolidated Balance Sheets

Consolidated Statements of Cash Flows

Sustainability

Consolidated Statements of Income

Corporate Data

Financial Section

Consolidated Statements of Comprehensive Income

Notes to Consolidated Financial Statements

Independent Auditor’s Report

Consolidated Balance Sheets
Tokyo Electron Limited and Subsidiaries
As of March 31, 2016 and 2015
Thousands ofU.S. dollars

Millions of yen

ASSETS

2016

2015

2016

Current assets:

Thousands ofU.S. dollars

Millions of yen

LIABILITIES AND NET ASSETS

2016

2015

2016

¥ 55,050¥ 56,479$ 488,552

Current liabilities:

Cash and cash equivalents¥ 95,638¥317,632$ 848,757

Trade notes and accounts payable

Short-term investments

141,035283

1,251,642

Income taxes payable

22,461

6,197

199,334

Trade notes and accounts receivable

116,503110,845

1,033,928

Accrued employees’ bonuses

11,624

12,111

103,159

(48)

(379)

(426)

Accrued warranty expenses

8,687

10,442

77,095Inventories

195,080

175,588

1,731,274

Other accrued expenses and other current liabilities

68,23987,583605,600

Deferred income taxes

31,204

27,672276,926

166,061

172,8121,473,740

Prepaid expenses and other current assets

38,004

39,242337,274

617,416

670,883

5,479,375

Net liablitiy for deﬁned beneﬁts

55,67751,480494,116

Other liabilities

7,391

10,69965,59363,06862,179559,709229,129

234,991

2,033,449

Common stock
Authorized: 300,000,000 shares
Issued: 165,210,911 and 180,610,911 shares
as of March 31, 2016 and 2015, respectively

54,961

54,961

487,762

Capital surplus

78,02378,023

692,430

Retained earnings

427,618

488,816

3,794,977(8,051)(9,064)(71,450)

Allowance for doubtful accounts

Total current assets

Total current liabilities

Non-current liablities:

Total non-current liabilities
Property, plant and equipment:

Total liabilities

Land

23,86825,022211,821

Buildings

147,653

152,979

1,310,375

Machinery and equipment

129,169

132,411

1,146,335

Construction in progress

3,774

2,424

33,493

304,464

312,836

2,702,024

208,147

205,940

1,847,240

96,317

106,896854,784

Total property, plant and equipment
Less: Accumulated depreciation
Net property, plant and equipment

Net assets:
Shareholders’ equity

Treasury stock, at cost
1,176,800 and 1,344,892 shares
as of March 31, 2016 and 2015, respectively
Accumulated other comprehensive income

Investments and other assets:
Investment securities

19,91423,935

176,730

Net unrealized gains on investment securities

7,903

9,463

70,137

Deferred income taxes

20,782

18,348

184,434

Net deferred gains on hedging instruments

50

122

444

Net asset for deﬁned beneﬁts

1,623

8,817

14,404Foreign currency translation adjustments

6,743

12,481

59,842Intangible assets

17,60327,567156,221

Accumulated remeasurements of deﬁned beneﬁt plans(4,878)4,682(43,291)

Other assets

21,53821,592

191,143

Share subscription rights

1,641

1,421

14,563

Allowance for doubtful accounts(1,825)(1,884)(16,196)

Non-controlling interests

229

258

2,032

79,63598,375

706,736564,239641,163

5,007,446¥793,368¥876,154$7,040,895¥793,368¥876,154$7,040,895

Total investments and other assets
Total assets
See accompanying Notes to Consolidated Financial Statements.

Total net assets
Total liabilities and net assets

PAGE

TOKYO ELECTRON ANNUAL REPORT 201623

CONTENTS

To Our Stakeholders

Business Overview

Financial Review

Medium-term Management PlanInterview with the CEO

Consolidated Eleven-Year Summary

Consolidated Statements of Changes in Net Assets

Review of Operations
and Business Outlook

Consolidated Balance Sheets

Consolidated Statements of Cash Flows

Sustainability

Consolidated Statements of Income

Consolidated Statements of Comprehensive Income

Notes to Consolidated Financial Statements

Independent Auditor’s Report

Consolidated Statements of Income

Consolidated Statements of Comprehensive Income

Tokyo Electron Limited and Subsidiaries
Years ended March 31, 2016 and 2015

Tokyo Electron Limited and Subsidiaries
Years ended March 31, 2016 and 2015
Thousands ofU.S. dollars

Millions of yen

Net sales
Cost of sales
Gross proﬁt
Selling, general and administrative expenses
Operating income

2016

2015

2016

¥663,949
396,739
267,210
150,421116,789¥613,125
370,351
242,774
154,661
88,113$5,892,3413,520,935
2,371,406
1,334,940
1,036,466

Other income (expenses):
Interest and dividend income
Foreign exchange gain, net
Revenue from grants
Gain on sales of property, plant and equipment
Gain on sales of investment securities
Commission for purchases of treasury stocks
Maintenance cost for domestic closed facilities
Loss on impairment of property, plant and equipment,
goodwill and other assets
Loss on business restructuring
Loss on liquidation for subsidiaries
Restructuring expenses on facilities
Additional payment of customs tax
Other, net
Income before income taxes

856
886
400
1,025
446
(662)
(147)

1,281
1,575
629
1,840
55
—
(48)

7,597
7,863
3,550
9,097
3,958
(5,875)(1,305)(9,727)(2,235)———(1,164)
106,467(2,506)—(1,070)(1,046)(1,003)(992)
86,828(86,324)(19,835)———(10,330)
944,862

Income taxes:
Current
Deferred
Net income

32,560(4,029)77,936

14,726
173
71,929288,960(35,756)
691,65844¥ 77,892

41¥ 71,888

391$ 691,267

Net income attributable to non-controlling interests
Net income attributable to owners of parent

Yen

Per share of common stock:
Net income — basic
Net income — diluted
Net assets
Cash dividends
See accompanying Notes to Consolidated Financial Statements.

¥ 461.10
460.003,428.37
237.00U.S. dollars¥ 401.08
400.153,567.23
143.00$ 4.09
4.08
30.43
2.10

Corporate Data

Financial Section

Thousands ofU.S. dollars

Millions of yen

Net income
Other comprehensive income (loss):
Net unrealized gains (losses) on investment securities
Net deferred gains (losses) on hedging instruments
Foreign currency translation adjustments
Remeasurements of deﬁned beneﬁt plans
Share of other comprehensive income of associates accounted
for using equity method
Total other comprehensive income (loss)
Comprehensive income
Total comprehensive income attributable to:
Owners of parent
Non-controlling interests
See accompanying Notes to Consolidated Financial Statements.

2016

2015

2016

¥77,936¥71,929$691,658(1,556)(112)(5,706)(9,233)

3,868
69
6,643
(2,270)(13,809)(994)(50,639)(81,940)(345)(16,952)
60,98456
8,366
80,295(3,062)(150,444)
541,21460,9622280,224
71

541,019195

PAGETOKYO ELECTRON ANNUAL REPORT 201624

CONTENTS

To Our Stakeholders

Medium-term Management PlanInterview with the CEO

Business Overview

Financial Review

Consolidated Eleven-Year Summary

Consolidated Statements of Changes in Net Assets

Review of Operations
and Business Outlook

Consolidated Balance Sheets

Consolidated Statements of Cash Flows

Sustainability

Consolidated Statements of Income

Corporate Data

Financial Section

Consolidated Statements of Comprehensive Income

Notes to Consolidated Financial Statements

Independent Auditor’s Report

Consolidated Statements of Changes in Net AssetsConsolidated Statements of Cash Flows

Tokyo Electron Limited and Subsidiaries
Years ended March 31, 2016 and 2015

Tokyo Electron Limited and Subsidiaries
Years ended March 31, 2016 and 2015
Millions of yen

Shareholders’ equity

Balance as of March 31, 2014
Cumulative effect of changes
in accounting policies

Commonstock

Capitalsurplus¥54,961¥78,023

Retainedearnings

Treasurystock¥436,174 ¥ (9,479)

Net unrealized Net deferred
Foreign
Accumulated
gains ongains oncurrency
remeasurements
Shareinvestment
hedgingtranslation of deﬁned beneﬁt subscription
securities
instruments adjustments
plansrights¥5,593¥ 60¥ 5,777¥ 6,982¥1,644

Noncontrollinginterests

Total
net assets¥10,879¥590,614——(1,102)

—

—

—

—

—

—

(211)

(1,313)54,961

78,023435,072(9,479)

5,593

60

5,777

6,982

1,644

10,668589,301

Cash dividends——(17,923)

—

—

—

—

—

—

—

(17,923)

Net income attributable toowners of parent——

71,888

—

—

—

—

—

—

—

71,888

Repurchase of treasury
stocks

—

—

—

(183)

—

—

—

—

—

—

(183)

Disposal of treasury stocks

—

—

(221)

598

—

—

———

—

377

Other, net

—

—

—

—

3,870

62

6,704

(2,300)(223)(10,410)(2,297)

Restated balance

Balance as of March 31, 2015

¥54,961¥78,023¥488,816¥(9,064)¥9,463¥122¥12,481¥ 4,682¥1,421258¥641,163

Cash dividends——(33,013)

—

—

—

—

—

—

—

(33,013)

Net income attributable toowners of parent——

77,892

—

—

—

—

—

—

—

77,892

Repurchase of treasury
stocks——

Disposal of treasury stocks——

Cancellation of treasury
stocks——Other, net——¥54,961¥78,023

Balance as of March 31, 2016

— (105,810)
(726)

1,472

(105,351) 105,351

¥

————

——

(105,810)——————746

—

—

—

—

—

—

—

—

(1,560)(72)(5,738)(9,560)220(29)(16,739)¥427,618 ¥ (8,051)¥7,903¥ 50¥ 6,743¥(4,878)¥1,641229¥564,239—¥

Thousands of U.S. dollars
Shareholders’ equity

Commonstock

Balance as of March 31, 2015

Capitalsurplus

Accumulated other comprehensive income

Retainedearnings

Treasurystock

Net unrealized Net deferred
Foreign
Accumulatedgains on
gains oncurrency
remeasurements
Shareinvestment
hedgingtranslation of deﬁned beneﬁt subscription
securities
instruments adjustments
plansrights

Noncontrollinginterests

Total
net assets$1,083$110,765$ 41,551$12,611$2,290$5,690,123

Cash dividends——(292,980)

—

—

—

—

—

—

—

(292,980)

Net income attributable toowners of parent——

691,267

—

—

—

—

—

—

—

691,267

Repurchase of treasury
stocks——— (939,031)

—

—

—

—

—

—

(939,031)

Disposal of treasury stocks

—

—

—

—

———

—

6,621

Cancellation of treasury
stocks——Other, net——

Balance as of March 31, 2016

$487,762 $692,430 $4,338,090 $ (80,440) $ 83,981(6,443)13,064

—

—

—

—

—

—

—

(13,844)(639)(50,923)(84,842)

1,952

(258)

(148,554)$487,762 $692,430 $3,794,977 $ (71,450) $70,137$ 444$ 59,842$(43,291)$14,563$2,032$5,007,446

See accompanying Notes to Consolidated Financial Statements.

(934,957) 934,957——

Thousands ofU.S. dollars

Millions of yenAccumulated other comprehensive income

Cash ﬂows from operating activities:
Income before income taxes
Depreciation and amortization
Loss on impairment of property, plant and equipment,
goodwill and other assets
Amortization of goodwill
Increase (decrease) in accrued warranty expenses
Interest and dividend income
Gain on sales of property, plant and equipment
Loss on sales of affiliates’ shares
Increase in trade notes and accounts receivable
Increase in inventories
Increase in trade notes and accounts payable
Increase in prepaid consumption tax
Increase (decrease) in accrued consumption tax
Increase (decrease) in customer advances
Other, net
Subtotal
Receipts from interest and dividends
Income taxes paid
Net cash provided by operating activities
Cash ﬂows from investing activities:
Payment for purchases of short-term investments
Proceeds from maturities of short-term investments
Payment for purchases of property, plant and equipment
Proceeds from sales of property, plant and equipment
Payment for acquisition of intangible assets
Proceeds from sales of investment securities
Proceeds from sales of affiliates’ shares
Other, net
Net cash provided by (used in) investing activities
Cash ﬂows from ﬁnancing activities:
Payment for purchases of treasury stock
Dividends paid
Other, netNet cash used in ﬁnancing activities
Effect of exchange rate changes on cash and cash equivalents
Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of year
Cash and cash equivalents at end of year
See accompanying Notes to Consolidated Financial Statements.

2016

2015

2016

¥106,467
19,257¥ 86,828
20,878$ 944,862
170,900

9,727
970(1,686)
(856)
(899)
1,111
(8,650)(23,535)
31(1,910)(1,022)(15,004)(203)
83,798957(15,357)
69,398

2,506
1,150
259
(1,281)(1,820)1,609(1,318)(26,850)
9,432(11,384)
2,707
12,912(1,203)
94,425
1,621(24,240)
71,80686,324
8,608(14,963)(7,597)(7,978)
9,860(76,766)(208,866)275(16,951)(9,070)(133,156)(1,801)
743,681
8,493(136,288)
615,886(209,491)
68,505(11,294)
2,151
(708)
1,330
—
(507)
(150,014)(24,997)
188,302(11,899)
2,549(422)1,093
1,726
(614)
155,738(1,859,168)
607,961(100,231)
19,089(6,283)
11,803—(4,499)(1,331,328)(105,532)(33,013)(56)(138,601)(2,777)(221,994)
317,632¥ 95,638(183)(17,923)(108)(18,214)3,505
212,835
104,797¥317,632(936,564)(292,980)(497)(1,230,041)(24,645)(1,970,128)
2,818,885$ 848,757