To Our Shareholders

Consolidated Performance Highlights

Key
Features

In presenting this overview of the Toyo
Denki Group’s business results for fiscal
2008 (the fiscal year from June 1, 2008 to
May 31, 2009 and 148th business term), I
would like to thank all of our shareholders
for their unfailing loyalty over the pastyear.
It is also my honor to report that at theconclusion of the Company’s 148th
Ordinary General Meeting of
Shareholders and subsequent Board of
Directors’ meeting, I was appointed tothe position of president of Toyo Denki
Seizo K.K. Under a new management
structure, the Toyo Denki Group is united
in its efforts to secure sustainable growth.
As we work toward our established goals,
we ask for your continued support andunderstanding.
August 2009

Hiroshi Tsuchida
1

President

Consolidated Financial Highlights

U navoidable downturn inoperating conditions in theA mid this decrease in net
contributions fromN e t i n c o m e d e c l i n e dfollowing the drop in shareorders received and net sales owing largely to the rapid and dramatic deterioration in
Industrial Systems segment on the back of a slump in capital investment.
sales, operating as well as ordinary income increased slightly buoyed by positive
improvements in manufacturing efficiency.
substantially reflecting the impacts of a loss on devaluation of investment securities
prices and other factors.

Results of Operations in the Fiscal Year under Review

Net Sales: 33,226 million yen (Down 12.9% year on year)

In fiscal 2008, the fiscal year ended May 31, 2009, economic
conditions in Japan were extremely harsh. This was attributable to avariety of factors including the sub-prime loan problem in the UnitedStates, which triggered a worldwide financial crisis and subsequent
downturn in the global economy. This difficult operating
environment was exacerbated by the substantial contraction incorporate sector production activity, impacted by the sharp anddramatic appreciation in the value of the yen from October 2008,
and such other factors as the abrupt slump in capital investment.
In response to these economic conditions, the Toyo Denki Group
worked to expand its operations and increase its corporate value
through the execution of its medium-term management plan, theInnovation 90 Plan. Consolidated performance during the fiscal year
under review was as follows.

Net sales totaled 33,226 million yen, 12.9% lower than the level
recorded in the previous fiscal year. While sales in theTransportation Business segment were essentially unchanged year
on year, results in each of the Industrial Systems and Information
Systems segments declined year on year for the same reasonsthat brought about the decrease in orders received.

While there are increased signs that the financial crisis-induced
recession has bottomed out, difficult operating conditions are
anticipated to persist into the future. On a positive note, however,railway-related infrastructure investment around the world is
projected to increase markedly. Under these circumstances, theToyo Denki Group has formulated its new medium-term
management plan, the Challenge Up Plan, which commences in
the fiscal year ending May 31, 2010. Under this plan, the Groupwill work diligently to further strengthen its managementfoundation while at the same time enhancing its corporate value.
Consolidated forecasts by business segment for the fiscal year
ending May 31, 2010 are as follows.

Operating Income: 1,396 million yen (Up 0.4% year on year)
Ordinary Income: 1,267 million yen (Up 5.9% year on year)
Net Income: 103 million yen (Down 80.7% year on year)(Unit: Million yen)
Net sales

From a profit perspective, gross profit margins improved
throughout the fiscal year under review, despite the year-on-year
decline in net sales. As a result, operating income edged up 0.4%
compared with the previous fiscal year to 1,396 million yen while
ordinary income climbed 5.9% year on year to 1,267 million yen.
Accounting for such factors as the loss on devaluation of
investment securities, however, the Toyo Denki Group reported a
net income of 103 million yen, a drop of 80.7% compared with theprevious fiscal year.

Orders Received: 36,464 million yen (Down 6.2% year on year)
Orders received amounted to 36,464 million yen, a decrease of
6.2% compared with the previous fiscal year. Despite an upswing
in the Transportation Business segment both in Japan andoverseas, this downturn largely reflected the substantial decreasein Industrial Systems and Information Systems segment orders
owing to the slump in capital investment demand in Japan.

Consolidated
Performance

Outlook for the Next Fiscal Year

Transportation Business Division

22,5001,650

Industry Business Division

10,000-300

IT Business Division

2,200

50

New Business

300

-100

35,0001,300

Consolidated Total

 Orders
 OrdersOrders
Received
Orders
Received
Received
Received
 Net Sales
 Net
Net
Net
Sales
Sales
Sales

 Operating Operating
Operating
Operating
IncomeIncome
IncomeIncome Ordinary OrdinaryOrdinary
IncomeOrdinary
IncomeIncomeIncome Net Income
 Net
Net
Net
IncomeIncomeIncome Net Income
 Net
Net
Net
Incomeper
IncomeIncome
Share
per
per
per
Share
Share
Share

(Unit: Million(Unit:
yen)(Unit:(Unit:
MillionMillionMillionyen)yen)yen)(Unit: Million(Unit:
yen)(Unit:(Unit:
MillionMillionMillionyen)yen)yen)(Unit: Million(Unit:
yen)(Unit:(Unit:
MillionMillionMillionyen)yen)yen)

45,00030,00015,000038,873 38,873
38,87338,87337,64937,64937,64937,64945,00045,00045,0003,000
36,46436,46436,464
38,130 36,464
38,13038,13038,13036,571 36,571
36,571
36,57133,226 33,226
33,22633,22630,00030,00030,0002,000

15,00015,00015,0000 00
2007/5 2007/5
2007/5
2007/5
2008/51,000

2008/5
2008/5
2008/5
2009/5

2009/5
2009/5
2009/5

0

3,000
3,000
3,000

600
300

1,391
1,391
1,391
1,396 1,267
1,396
1,396
1,396
1,267
1,267
1,267
1,197
1,197
1,197
1,197
0

1,000
1,000
1,000
0 00
2007/5 2007/5
2007/5
2007/5
2008/5532

 ROE: Net
 Income
ROE:
ROE:
ROE:
Net
toNet
Shareholders’
IncomeNetIncome
Incometo Shareholders’
totoShareholders’EquityShareholders’
RatioEquity
EquityEquity
Ratio
Ratio
Ratio
 ROA: Ordinary
 ROA:ROA:ROA:
IncomeOrdinary
Ordinary
Ordinary
toIncome
Total
IncomeIncomeAssetsto Total
totoRatio
Total
Total
AssetsAssetsAssets
Ratio
Ratio
Ratio

(Unit: Yen) (Unit:(Unit:(Unit:Yen)Yen)Yen)(%)

53253253240

1040 4040(%)(%)(%)
10 10105.7

1,967 1,928
1,967
1,967
1,967
1,928
1,928
2,000
2,000
2,0001,928
1,391

600600600

2008/5
2008/5
2008/5
2009/5-300
2009/5
2009/5
2009/5300300
300

11.84

3.33
3.33
3.33
3.33
0 00
151

151
151
151

11.84
11.84
11.84
103
2.32

Operating income20

20 20205

103103
103
0

2.32
2.32
2.32

0 00 0

-300
-300
-300
-20
-20-20-20-52007/5 2007/5
2007/5
2008/5
2007/5 2008/5
2008/5
2009/5
2008/5 2009/5
2009/5
2009/55 55

5.75.7
5.7
3.7

3.4
1.0
1.0
1.0
0 0 0 1.0

3.73.73.7
3.7

3.73.73.7

0.8
3.43.43.4

0.80.80.8-5 -5-5
2007/5 2007/5
2007/5
2008/5
2007/5 2008/5
2008/5
2009/5
2008/5 2009/5
2009/5
2009/52

An Interview with
~Issues and Results to Date and an Introduction tot h e P r e s i d e n t the Toyo Denki Group’s New Medium-Term Management Plan~
Building a Robust Business Platform Amidst
a Harsh External Operating Environment

In Taking Up the Challenge to
Secure Further Growth,
the Toyo Denki Group Will
Continue to Deliver New Value.
Buffeted by the impacts of the global economic crisis, the Toyo Denki Group was confronted by theharsh realization that it had failed to achieve its established goals at the end of both its 148th businessterm and the Innovation 90 Plan, its recently concluded three-year medium-term management plan.
Against this backdrop, Hiroshi Tsuchida, Toyo Denki’s newly appointed president, outlined the issues
confronted and results achieved to date as well as the Group’s growth strategies leading into the future.
August 2009

Hiroshi Tsuchida President

Q

As Toyo Denki’s newly appointed president,
could you please provide us with an insight
into your ambitions and aspirations?

As the newly appointed president of a company that has consistently contributed to society through the development and application of innovative electrical technology over a period that spans nine
decades, I am both honored and humbled at the task that lies
ahead, fully recognizing my responsibilities in this most difficult ofages.
I am very much a believer in the adage that a company begins andends with its people. Naturally, as the newly appointed president, it
is imperative that I personally drive the Group forward, working diligently to further enhance corporate value. It is through the collective energy and power of all employees, however, that we willachieve business expansion and profit growth. It is my role therefore to ensure a corporate environment that is conducive to achieving these stated goals. As president, I am committed to making
every effort to fulfill the expectations and garner the trust of shareholders.
3

Q

In the context of the Group’s performance in its
148th business term, please tell us about the issues
confronted by and results of each business segment?

In the Transportation Business segment, we took steps to increase
our market share in Japan and to further development our overseas
business focusing mainly on China and North America. In the fiscal
year under review, railway companies in Japan continued to placeconsiderable weight on transportation services that take into
increasing consideration concerns for safety, security, comfort andthe environment. As a result, orders received were firm reflecting
positive demand for new and updated railway stock.
Fiscal 2008 was also a year in which we strengthened our footholdin overseas markets, particularly in China. In October 2008, Toyo
Denki was invited to an award ceremony to recognize contributions
to the Beijing Olympic Games by the Beijing Mass Transit Railway
Operation Corp., Ltd., and was honored for the features and reliability of its products, extensive delivery record and outstanding
maintenance systems and service that contributed to a successful
Beijing Olympic Games. Leveraging this performance and the trust

Transportation
Business Segment

57.6%(Percentage of
total net sales)

Net Sales: 19,122 million yen (Down 3.3% year on year)
Operating Income: 1,501 million yen (Up 175.9% year on year)
Net Sales

Operating Income(Unit: Million yen)

20,000(Unit: Million yen)

19,781

19,122 1,501 1,600

37.3%

57.65%.1%(Percentage(Percentage
ofofIndustrial Systems
sales)net sales)
Segment total net total(Percentage of
total net sales)

37.3%(Percentage of
total net sales)

Net Sales: 12,399 million yen (Down 22.0% year on year)
Operating Income: 10 million yen (Down 98.7% year on year)
Net Sales

Operating Income(Unit: Million yen)

(Unit: Million yen)

20,0001,200

15,901

15,0001,200

15,00010,000800

10,000

600

400

5,000

300

544

5,000
0

2008/5

2009/500900

798 12,399

10
2008/5that it garners, Toyo Denki will continue to expand its business evenfurther.
In the Industrial Systems segment we confronted an extremely
harsh operating environment. Suffering from the effects of the global economic recession, corporate sector capital investment saw anabrupt downturn. As a result, orders received and sales in this segment declined dramatically.
Demand for IC card-compatible equipment settled leading to a
decline in orders received and sales in the Information Systems
segment. From the fiscal year ending May 31, 2010, Toyo Denki is
projecting the launch of a host of new businesses and the releaseof new products that embody the Group’s2007/5
continued emphasis on
research and development that draws on the Group’s core technologies.

Q

57.65%.1%

The recently completed 148th business term was the last fiscal
year of the Innovation 90 Plan. Please provide us with an
overview of the Group’s progress and results under the plan.

The fiscal year ended May 31, 2009 marked both the Company’s
90th anniversary since foundation and the completion of its threeyear medium-term management plan. Under this plan, we implemented a wide spectrum of initiatives aimed at cultivating new customers and enhancing Group corporate value. From the outset of
the Innovation 90 Plan, we confronted harsh operating conditions.
After a prolonged period of intensifying competition, sharp hikes in
the prices of raw materials and other factors, difficult conditions
were exacerbated from the second half of the Plan by the global
financial crisis which triggered a worldwide recession and abrupt
appreciation in the value of the yen. Buckling under the mountingpressure of these adverse conditions, we failed to achieve theobjectives set at the beginning of the three-year period.

2009/5

0

37.3%

5.1%

(Percentage
ofInformation
Systems
Segment total net sales)(Percentage(Percentage
ofof
total net total
sales)net sales)

Net Sales: 1,704 million yen
Operating Loss: 115 million yen
Net Sales(Unit: Million yen)60

2,447 49
1,704

1,500

115

0
-1,500(Down 30.3% year on year)(–)

Operating Income(Unit: Million yen)

3,000

(Percentage of
total net sales)

2008/5

2009/530
0-120

Despite this harsh operating environment, we continued to proactively develop our Transportation Business overseas and took steps
to develop new technologies in the Information Systems segmentthat would lead the way in remote monitoring systems. On thisbasis, I am confident that we have laid a platform that will help to
expand business activities and pave a path toward future growth.
Taking into consideration the results of the Innovation 90 Plan andthe issues that remain pending, we have formulated the Challenge
Up Plan, our new three-year medium-term plan that takes us
through to the fiscal year ending May 31, 2012. Guided by thisplan, we have adopted an increasingly unified approach as weembark upon a journey filled with exciting new challenges.

Q

What then do you plan to achieve
under the Challenge Up Plan andwhat are its key points?

As we take up this fresh challenge to realize our long-term vision,
the Toyo Denki Group has identified six key policies as its strives toachieve the established targets of net sales of 42 billion yen andoperating income of 3 billion yen (Please refer to page 6).
(1) In its efforts to increase Group corporate value, Toyo Denki willplace every emphasis on promoting a consolidated operating division system while thoroughly implementing cash flow management.
Through these means, the Group will solidify its management andbusiness platforms. At the same time, Toyo Denki will take fulladvantage of business alliances and promote collaboration with theaim of developing business in an efficient and timely manner.
In this latter regard, Toyo Denki concluded a business allianceagreement with Fuji Electric System Co., Ltd. for the manufactureand sale overseas of electrical equipment used in rail vehicles.

4

An Interview with
the President(2) Cultivating overseas markets where increased demand is anticipated is considered an important key to the Group’s businessgrowth. On this basis, Toyo Denki has identified a target ratio ofoverseas sales to total sales of 30% in its Challenge Up Plan.
Positioned as an integral component in the nation’s ongoing development, efforts to further enhance rail infrastructure in China areseen as providing a lucrative opportunity for the Toyo Denki Group.
Coupled with the Obama Administration’s focus on high-speed railtransportation throughout North America, we will place considerable weight on markets where we boast an established trackrecord. Leveraging our accumulated expertise, we will also pursue
business in such markets as India and Russia, countries that continue to enjoy rapid growth. Based on the aforementioned, theToyo Denki Group will actively pursue cooperative ties and allianceswith appropriate business partners in an effort to reinforce our overseas market development capabilities.
(3) Working to create new businesses, Toyo Denki is taking fulladvantage of its proprietary in-wheel motor and other technologies
to develop innovative direct drive system applications for electricvehicles. Representing another milestone in the Group’s ongoingdevelopment, Toyo Denki newly established the Business
Development Department in June 2009 and is accelerating initiatives to develop new businesses.
(4) As a part of its existing business activities, Toyo Denki will continue to develop and provide new products that anticipate theneeds of customers. In addition to the development of such products as fully enclosed induction motors in its rail operations andhighly efficient, intelligent inverters in its Industrial Systems businessthat collectively contribute to the creation and maintenance of alow-carbon society, Toyo Denki is expanding sales of its remotemonitoring systems that utilize information technologies.
(5) In an area of significant importance that calls into question Toyo
Denki’s raison d’être as a responsible corporate citizen and member of the community, the Group will substantially bolster its CSR
activities.
The Japan Fair Trade Commission examined the participants in thebidding for designated electrical equipment construction orderedby the City of Sapporo in Hokkaido in accordance with provisionsof the Anti-Monopoly Act and issued cease and desist as well assurcharge payment orders in October 2008. Following determination of the aforementioned orders, Toyo Denki received a businesssuspension order, based on the Construction Industry Act, fromJapan’s Ministry of Land, Infrastructure, Transport and Tourism in
April 2009. The Toyo Denki Group accepts this reprimand with theutmost seriousness. I would like to express my sincere apologies toall stakeholders for the considerable inconvenience caused.
Looking ahead, the Group is committed to reviewing its compliancesystems and raising employee awareness toward strict adherence
to all laws. Through these means, the Toyo Denki Group will
endeavor to restore its credibility and engender the trust of all
stakeholders.
As a part of our environmental protection activities, we formulated aGroup-wide Environmental Philosophy in June 2009. With this as
our platform, we plan to implement concrete measures aimed at
protecting the global environment.

5(6) Toyo Denki recognizes that the driving force
behind each of the aforementioned policies is its
people. In this regard, we
will establish and promote a dynamic corporate culture and upgrade
human resource education and training toachieve our establishedgoals.
Leveraging the flexibility
and creativity inherent ineach and every Toyo
Denki employee, together with the Group’s
sophisticated technologies nurtured since its
foundation, we will continue to development
innovative products andsystems that are bothsought and revered by
the community at large.
Moving forward, theToyo Denki Group isdedicated to delivering
new value to society.

Q

Do you have any comments you
would like to make to shareholders?

Both management and Group employees are united in theircommitment to develop businesses that will further enhance therelationship of trust nurtured with shareholders, the fruits of theseendeavors being the uninterrupted upswing in corporate value andthe stable return of profits.
In the fiscal year ended May 31, 2009, we confronted an
unprecedented economic recession of global proportions. Despite
this harsh operating environment, the Toyo Denki Group posted
fiscal year-end profits and declared a cash dividend of 6 yen per
share, unchanged from the previous fiscal year. Looking ahead, ourgoal is to deliver to our shareholders a constant cash dividend pershare of 6 yen or more in this current fiscal year and beyond.
As we work toward our established goals, I humbly request thecontinued support and understanding of all shareholders.

●

Challenge Up Plan, the New Medium-Term Management Plan ●Essential Features of thePlan’s Key Policies(1) Further increase Group corporate value- Take full advantage of business alliances- Place every emphasis on promoting a consolidated operating
division system- Thoroughly implement cash flow management(2) Fortify the Group’s efforts toward overseas expansion- Focus on the Chinese and North American markets- S trengthen operating platforms in the Indian and Russian
markets(3) Generate new businesses- Enter the electrical product and equipment markets targeting
environmentally friendly electric vehicles(4) Develop new products- Develop specific products that contribute to the creation andmaintenance of a low-carbon society- Develop services that utilize information technology

Consolidated Management Targets to be Achieved by the
Final Fiscal Year of the Plan, the Fiscal Year Ending May 31, 2012
(1) Net sales: 42 billion yen(2) Operating income (margin): 3 billion yen (7.2%)(3) Ratio of overseas sales to total sales: 30%(4) Return on equity (ROE): 10%(5) Experimental and research expenses: 1.2 billion yen(6) Capital investment (IT investment): 1.2 billion yen (0.3 billion yen)(7) Number of employees: 1,100● Consolidated Results for the Fiscal Year Ended May 31, 2009
and Management Targets in the Final Fiscal Year of the Plan

(5) Bolster CSR activities(Unit: Million yen)

- F ormulate a Group-wide Environmental Philosophy as aplatform for increased activity and effort aimed at protecting the
global environment(6) Establish and promote a dynamic corporate culture- Continue to implement 5S activities—Sort (seiri); Set in order(seiton); Shine (seiso); Standardize (seiketsu); Sustain / Selfdiscipline (shitsuke)—and improve the environment of each
workplace- Reform and upgrade human resource education and training
systems

Long-Term Vision

Fiscal 2008
ActualNet sales

Fiscal 2011
Targets

33,22642,000Operating income
%

1,396
4.2%

3,000
7.2%

Ordinary income

1,267

2,800

Net income

103

1,500

● Drawing on the core electric motor drive technology that the Group
has amassed since its foundation, the Toyo Denki Group iscommitted to realizing next-generation high-speed railroads and arecycling-based society, by fusing highly sophisticated informationoriented machines and electronics.
● Net sales: 100 billion yen

6Special
FeatureMap of the Beijing Subway Network (Plan for 2015)

Toyo Denki’s Activities in China’s
Railway Market
2010

N

Harbin2020

Total operating
90,000 km or morerail line length

120,000 km or more

Electrification ratio 45% or more

60% or more

45% or more

50% or more

Double track ratio

The Chinese government announced details of an economic stimulus package totaling 4 trillion yuan in November 2008, placing particular emphasis
on efforts to further develop the nation’s transportation infrastructure. Working to enhance China’s high-speed rail network, the Ministry of Railways of
the People’s Republic of China plans to have more than 120,000 kilometers of rail lines in service with electrified lines and double tracks accounting
for over 60% and 50%, respectively, by 2020.

From the Collaborated with a rail vehicle factory of China’s national railway to develop variablesecond half of voltage, variable frequency (VVVF) rail vehicle for use in urban areas both inside andthe 1980s outside China
1997
2003

Established Hunan Xiangyang Electric Co., Ltd. in China

2005(the company is engaged in the manufacture of electrical equipment for urban transportation use)

Received an order for electrical equipment for trains servicing the Beijing Subway Line 10
Opened an office in Beijing
Established Changzhou Taiping Zhanyun Automatic Door Co., Ltd., in China(the company is engaged in the manufacture and sale of door closing equipment for use in buses and trains)

7

Zhengzhou

Received an order for electrical equipment for trains servicing the Beijing Subway Line 1
Established Changzhou Ruiyang Transmission Technology Co., Ltd. in China

2007

Received an order for electrical equipment for trains servicing the Chengdu Metro Line 1

2008

Received an order for gear units for use in high-speed trains that service the line
connecting Wuhan and Guangzhou

Beijing — Shanghai
Beijing — Wuhan — Guangzhou — Shenzhen

2009

Received simultaneous orders for an aggregate total of 528 rail vehicles that are
projected to service three new lines within the Beijing Subway network (plan for 2015)— Please refer to the upper-right lines 1 to 3S hanghai — Hangzhou — Ningbo —Fuzhou — Shenzhen■ F our vertical commuter lines
running roughly from south to northBeijing — Shenyang — Harbin

XuzhouShanghaiHangzhou
Wuhan

Chongqing

Kunming

NingboLine 10
Line 14
Airport Line
Line 2

Line 5
Line 7
Line 9Line 13

Line 15

FuzhouToyo Denki’s Initiatives in China
Guangzhou
ShenzhenReceived an order for gear units for trains
servicing the Wuhan and Guangzhou line.

As indicated in the map of the Beijing Subway Network shown above, significant development isanticipated through to 2015. Looking ahead, Toyo Denki will actively tender for this new business andwork diligently to secure new orders and an increase in its share of the overall project.
Leveraging the know-how gained through its participation in the development of the Beijing Subway
Network, Toyo Denki will also take concrete steps to secure new orders in other urban transportation
projects focusing on regional areas such as the Chengdu Metro in Sichuan Province.

■ F our horizontal commuter lines
running roughly from west to east
Xuzhou — Zhengzhou — Lanzhou
Hangzhou — Nanchang — Changsha —Guiyang — Kunming
Qingdao — Shijiazhuang — Taiyuan
Nanjing — Wuhan — Chongqing — Chengdu

Line 1
No. 4 Line 4
Line 6
Line 8Nanchang

Guiyang
Toyo Denki commenced the progressive
delivery of electrical equipment (running
control units, traction motors, drive gear units,
low voltage power units, transmission units)
and brake units for rail vehicles from 2008.

Toyo Denki’s Beijing OfficeNanjingChangsha2006(the company is engaged in the manufacture of gear units for urban transportation use)

Tiananmen Square

Qingdao

Jinan

ChengduChengdu Metro Line 1 tocommence operations in 2010

TianjinLanzhou

XianLines for which Toyo Denki
has received firm orders

Shenyang

Shijiazhuang

Subway and monorail lines are also attracting interest. Such government-designated cities as Shanghai and various ministries are in particular
promoting a succession of projects as a part of the nation’s overall municipal transportation development plans.

Received an order for VVVF electrical equipment for trains servicing the Beijing Subway
Fuba Line (the launch of AC-motor drive trains in China)

The Olympic Stadium

Taiyuan

For its part, Japan currently boasts approximately 27,000 kilometers of rail lines in service with electrified lines and double tracks accounting for 57%
and 35%, respectively. On this basis, China’s rail market is expected to experience substantial growth moving forward into the future.

S

Lines for which deliveries
have been completed

Beijing

Current Status of China’s Railway Market

A History of Toyo Denki’s Activities in China

The Beijing Subway
Line 10

Toyo Denki received an order for gear units foruse in 30 high-speed (350 kilometer per hour)trains (eight vehicles per train) that service theline connecting Wuhan and Guangzhou.

Taking full advantage of its foothold in China’s high-speed rail market, built on an established strength,
namely the supply of gear units, Toyo Denki will endeavor to secure orders for other electricalequipment for use in rail vehicles and reinforce its relationships with Chinese railcar manufacturers.
In each case, the Group will look to optimize cooperative ties between manufacturing bases in Japanand joint ventures established in China with local companies. Through these means, every effort will bemade to further enhance the overall awareness and acceptance of the Toyo Denki brand in China.

8

To y o D e n k i ’s C S R A c t i v i t i e s

CSR

An Environmental Philosophy Formulated
Taking into consideration the growing importance ofcontributions by the corporate sector to promote global
environmental protection, Toyo Denki formulated its
Environmental Philosophy in June 2009 as a policy platform
for its ongoing environmental activities.
Toyo Denki supplies a wide spectrum of environmentallyfriendly products in each of its Transportation Business,
Industrial Systems and Information Systems segments.
Underpinned by the following Environmental Philosophy and
Code of Conduct, Toyo Denki will step up its environmental
protection activities working tirelessly to contribute to thedevelopment of a sustainable society.

● Environmental Philosophy ●The Toyo Denki Group has positioned global environmental protection
as a key management issues. In this context, the Group will makeevery effort to contribute to the development of a sustainable society.
● Code of Conduct ●Through future technologies that harmoniously blend the needs of the
global environment and humankind, the Toyo Denki Group willconsistently deliver products and services that work to reduce adverse
impacts on the environment. To this end, the Group is committed toengaging in the following conduct.

1. Strictly comply with all environment-related laws and regulations
2. Engage in activities that reduce environmental load including efforts
to cutback energy consumption at each stage of its products’
lifecycles from planning through development to design,
manufacture, sale, use and disposal
3. Establish and implement systems that facilitate the ongoingpromotion of global environmental protection activities
4. Raise environmental awareness in each and every employee
through education and training throughout the Group
June 2009

The new research, development and design center
under construction.

An image of the completed
wind-power generator.

Installing Wind- and Solar-Power Generation Facilities
at Its Research, Development and Design Center
Toyo Denki continues to make steady progress in the construction of a
research, development and design center within its Yokohama Works. The
new complex is scheduled for completion in October 2010. Taking into
consideration environmental concerns, current plans call for the installation ofwind- and solar-power generation facilities on the roof of the center.
Utilizing the world’s first control circuit- or converter circuit-less method, atechnique developed at Toyo Denki’s research center, the wind turbine
generator scheduled for installation is a highly efficient wind-power generation
system. Consisting of a permanent magnet multi-pole synchronous generator
optimized to a wind turbine, reactor and rectifier, the system does not use
either a control unit or pulse width modulation converter.
In addition, the solar power system is estimated to produce annual electricity
output of 11,000 kWh. Accordingly, the installation of this system is projected
to reduce CO2 emissions by approximately 7,700 kg each year.
Placing every possible emphasis on the environment, designs for the newcenter incorporate a host of features including energy-saving lighting as wellas water-saving hygienic equipment.

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