Furukawa Electric Group Sustainability Report 2013

Group Overview and Business ReportCompany ProfileCompany Name

Furukawa Electric Co., Ltd.

President

Mitsuyoshi Shibata

Founded1884

Established1896

Paid-in Capital(As of March 31, 2013)¥69,395 million

Net sales¥924,717 million (Consolidated)(Years ended March 31, 2013) ¥396,154 million (Non-Consolidated)
Number of Employees(As of March 31, 2013)

50,342 (Consolidated)
3,971 (Non-Consolidated)

Head Office

Marunouchi Nakadori Bldg., 2-3, Marunouchi 2-chome, Chiyodaku, Tokyo 100-8322, JapanTEL+81-3-3286-3001

Major Products and Services
1.

2.

3.

4.

5.

6.

Telecommunications
Optical fiber cables / Metal communication cables / Semiconductor optical devices / Electronic appliance wires /Optical components / Network equipments / Optical fiber cable accessories and installations / CATV system /Radio products, etc.
Energy and Industrial Products
Copper wires and Aluminum wires / Power transmission cable / Insulated wires / Power transmission cable
accessories and installations / Cable conduits / Water-feeding pipe materials / Foam products / UV tapes forsemiconductor manufacturing / Electrical Insulation Tape / Electric material products, etc.
Electronics and Automotive Systems
Automotive components and wiring harness / Magnet wires / Electronic component materials / Heatsinks / Hard
disc drive (HDD) aluminum substrates / Battery products, etc.
Metals
Copper and copper alloy products (plates, strips, pipes, rods, foils, and wires) / Functional surface products (plating)/
Electrodeposited copper foil / Pocessed products for electronic parts / Superconducting products / Special metalmaterials (Shape-memory and super-elastic alloys), etc.
Light Metals
Aluminum plates / Extruded aluminum products / Casting products / Forged products / Processed light metalproducts, etc.
Services and Others
Logistics / Information processing service / Software development / Service business (real-estate leasing, hydraulicpower generation and so on), etc.

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Furukawa Electric Group Sustainability Report 2013

Global Network
As of July, 2013

(note) Main subsidiaries and equity-method affiliates

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R&D Laboratories, developer and producer

FETI: Furukawa Electric
Institute of Technology(Hungary)

OFS Labs. (USA)SuperPower (USA)

http://www.furukawa.co.jp/kenkai/e

http://www.furukawa.co.jp/kenkng/profile/ofs.htm

ai/eng/profile/superpower.htm

http://www.furukawa.co.jp/kenkai/eng- Fibers- Components- 2G HTS wire

/profile/feti.htm- Simulation development- Algorithm development- Process optimization

Metal ResearchLaboratories (Nikko)

Power & System
Laboratories (Chiba)

Polymer Materials R&D
Laboratories (Hiratsuka)

Yokohama R&D
Laboratories (Yokohama)

http://www.furukawa.co.jp/

http://www.furukawa.co.jp/k

http://www.furukawa.co.jp/kenkai/

http://www.furukawa.co.jp/kekenkai/eng/profile/metakenenkai/eng/profile/powerandeng/profile/kankyoelec.htmnkai/eng/profile/yokoken.htm.htm

sys.htm

FITEL Photonics
Laboratories (Chiba)
http://www.furukawa.co.jp/kPower & System Laboratories(Hiratsuka)
http://www.furukawa.co.jp/kenkai/eng/profile/powerandsys.htm

enkai/eng/profile/hikaken.htmAutomotive System & Device
Laboratories(Hiratsuka)
http://www.furukawa.co.jp/kenkai/eng/profile/densou.htm

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Business Field

Telecommunication
Optical communication is an advanced technology that meets the needs of the communication age,
Furukawa Electric provides diversified support for information-oriented society.
We are living in an age of global communication. Currently, the Internet Links the entire world, allowing information fromoverseas to be obtained in real time, not only in offices but also at home. In this advanced information-oriented society,optical communication systems are a key technology for enabling people to access important information easily.
Furukawa Electric is firmly supporting an ideal base for communication by providing various technologies and productsthat realize the "FTTH" project, in which optical fiber networks are provided to homes.
Electronics Products
http://www.furukawa.co.jp/english/seihin/it.htm

Electronics
Ever-evolving Semiconductors and their Peripheral Technologies Amplify
New Possibilities for the Electronics Industry.
Semiconductors are the basis on which electronic products are continually decreasing in size, and increasing infunctional capability at a rapid pace. In LSIs, several hundred thousand to tens of millions of electronic components areincorporated on a chip in an area of several square mm, to process large amounts of information. In the field ofsemiconductors, Furukawa Electric has developed many products ranging from compound semiconductors to complete
devices. It has also provided various other products that are densely mounted in the periphery of semiconductors; reflow
ovens for mounting these products; and heat pipes essential for cooling microprocessors. Each of these products isbacked by reliable, established technologies.
Electronics Products
http://www.furukawa.co.jp/english/seihin/electronics.htm

Automobile
Themes Are Safety, Comfort, and Harmony with Environments. Furukawa Is Challenging Transportation
Possibilities Using Total Technologies.
In the field of transportation including automobiles, trains, ships, airplanes, and H II rockets, Furukawa Electric combines
its proprietary material, electronics, and mechatronics technologies to develop various products forming comfortabletransportation environments. In particular, in the field of automobiles, we offer various electronic components andaluminum body materials including wire harnesses. Furthermore, we are challenging advanced technologies such as ITS
systems and has established a firm status as an indispensable supplier for the automobile industry.
Automobile Products
http://www.furukawa.co.jp/english/seihin/car.htm

8Furukawa Electric Group Sustainability Report 2013

EnergyUsing Total Technologies to Construct Advanced Power Networks While Meeting the Needs for Energy
Saving and Environmental Preservation
Few things are as essential for our daily lives and industries as electric power. Furukawa Electric has been meeting theincreasing electric power demand through "power transmission systems" and "power distribution cables". We are also
actively responding to the demands of the times for resource saving and environmental preservation. Furukawa is
contributing to society by providing various leading-edge technologies such as superconductors and solar generation
systems, which are the focus of wide spread attention as energy sources for the next generation.
Energy Products
http://www.furukawa.co.jp/english/seihin/energy.htm

Construction
Unifying Advanced Material and Processing Technologies Together While Creating Amenity
Environments for Cities, Buildings, and Housings
What is a comfortable space? Whether it is required in a city or a building, constructing such a space requires
correct perspective and advanced technologies for achieving ideals. While applying the accumulated technologies,
Furukawa Electric has been developing various products supporting comfortable lives. Our objective for pursuing
harmony between the functions of peoples' lives and environments is found in each of our products ranging fromconstruction materials through wire materials and fire prevention products to housing facilities.
Construction Products
http://www.furukawa.co.jp/english/seihin/construction.htm

Material
Constant Challenges to Material Renovation and Development of New Materials Are Facilitating
Unlimited Extension of Applications in Every Industry.
Over 120 years since its establishment, Furukawa Electric has been constantly offering advanced materials ranging fromcopper and aluminum materials to wires and cables, as well as various related materials. Constant challenges to material
innovation are facilitating creation of materials with new potentiality and unlimited extension of applications from familiar
products to the high technology field. These materials dramatically change our lives and the foundation of the industries.
Material Products
http://www.furukawa.co.jp/english/seihin/material.htm

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Key Indicators
Net sales

Operating income (loss)

Operating income (loss)

Net income (loss)(Ratio to net sales)

Net income per common share

Return on equity(note) Shareholders' equity excludes minority interest and gain andloss on deferred hedge.

Cash flows

10Furukawa Electric Group Sustainability Report 2013

AT A GLANCE
Net sales by Main Business Segment

Telecommunications
Optical Fiber and Cable

Streamline global sites and expanding sales routes ingrowth markets
Brazil: Reinforce optical cable production capacity
Japan: Consolidate optical cable operations at the Mie
Plant.

Brazil investing
aggressively ininfrastructure inpreparation for theSoccer World Cup
and the Olympics

Optical Parts and Networking Equipment

Introduce new products for next-generation high-speedtransmission (digital coherent communication)
Develop narrow linewidth micro ITLA (opticaltransmission modules)
Overview for the Year Ended March 31, 2013
http://www.furukawa.co.jp/english/ir/achiev
ements/seg_jyotsu.htm(To “For Investors” content)

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Conventionally sized
ITLA (top) and micro
ITLA (bottom)

Furukawa Electric Group Sustainability Report 2013

Energy and Industrial products
Ultrahigh-Voltage Transmission Cables

Double the capacity of submarine transmission cables
Complete large-scale vertical lay-up machine by end of fiscalyear

Laying a submarinetransmission cable

Commence full-scale operation in FY2015 (VISCAS, anaffiliated company)

Power Supply and Distribution CablesRespond to demand for new energies (wind power, solarpower, etc.)

Overview for the Year Ended
March 31, 2013
http://www.furukawa.co.jp/english/ir/achievements/seg_energy.htm(To “For Investors” content)

Double production of flexible plastic pipe to meet increased
megasolar demandConceptual image of theoffshore wind farmproject in Fukushima
Prefecture

Proceed with offshore wind farm project in Fukushima
Prefecture

Electronics and Automotive systems
Automotive Parts

Establish regional headquarters to be in charge of sales, designand procurement
China: Establish regional headquarters in Shanghai in July 2013
Cultivate demand from local automakers

Wire harness factory inChina

Expand production bases, focused on Southeast Asia andCentral and South America
Mexico: Establish new company, scheduled to commence
operations in January 2014
Philippines: Expand new factory, scheduled to go on line inJanuary 2014

Overview for the Year Ended
March 31, 2013hhttp://www.furukawa.co.jp/englis
h/ir/achievements/seg_electronics.htm(To “For Investors” content)

Maintain or increase share for SRC (automotive airbag parts)

Brazil, India: Prepare for local production in anticipation thatairbags will become mandatory (operational in FY2015)
12SCR connector

Furukawa Electric Group Sustainability Report 2013

MetalsElectrodeposited Copper Foil

Develop the hybrid automobile market
Shift production to Taiwan, where electricity costs are low

New factory in Taiwan

Overview for the Year Ended March
31, 2013
http://www.furukawa.co.jp/english/ir/achievements/seg_material.htm(To “For Investors” content)

Light metals
Rolled Aluminum Products

Become a major globally competitive aluminum company
Through the business integration of Furukawa-Sky and Sumitomo Light MetalIndustries, become No. 3 in the world in terms of production capacity (includingoverseas plants that are under construction)

Logo of the merged company

Overview for the Year Ended March31, 2013
http://www.furukawa.co.jp/english/ir/
achievements/seg_lightmetals.htm(To “For Investors” content)(note) In line with a management integration on October 1, 2013, the integrated company(UACJ) will become an equity-method affiliate. Consequently, net sales and operating income areexcluded from October 1, 2013.

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