Business Report for Fiscal Year 2013
(From April 1, 2012 to March 31, 2013)
Stock code: 6995

To Our Shareholders
Review of Operations
Tokai Rika is grateful to its shareholders fortheir continued support.
In this business report, we present theCompany's business results for fiscal year
2013 (from April 1, 2012 to March 31, 2013)
and report on the challenges and opportunities
ahead.

Yuzo Ushiyama
President
1

In the fiscal year under review, the world economy
grew at a modest pace overall. The European economies
remained stagnant due to the sovereign debt crisis andgrowth of certain emerging economies such as China
and India slowed. On the other hand, the U.S. economy
was supported by buoyant personal consumption andresidential investment and in Japan, demand wasboosted by the subsidy program for purchasers ofenvironmentally friendly vehicles and construction
associated with recovery from the Great East Japan
Earthquake. In addition, weakening of the yen and an
upward trend in the stock market from the end of 2012
had a positive impact on the Japanese economy.
In the automotive industry, while demand in Europe
remained sluggish, demand for replacements in the U.S.
was robust, supported by the brisk economy and autos a l e s v o l u m e s i n J a p a n i n c re a s e d , a s s i s t e d b y
government policies such as the eco-car subsidy
program. Regarding emerging economies, sales volumes
continued to increase at a moderate rate in China, India,
and Brazil, and sales volumes in Thailand surged
following the introduction of a subsidy program by theThai government for purchases of new vehicles and also
as an aftermath of the flooding in the previous year. As aresult, worldwide auto sales volumes increased from theprevious year.
In order to address the changing businessenvironment—notably the ongoing expansion of
emerging economies, the diversification of needs, thecontinuing shift of car manufacturing overseas, andintensifying price competition globally—Tokai Rika Group
implemented a growth strategy focused on four key
themes: quality, new product development, prevailing in
Asia, and reinforcing the management constitution.
Specifically, we meticulously reflected the actual usageof vehicles in markets around the world into our productdesign and evaluation and created new products attuned
to user and market needs. We established a new seatbelt
manufacturing company in Indonesia where the market is
rapidly growing. In addition, we sought to establish a

simple business structure capable of flexibly responding
to change in the business environment and took action to
reduce fixed costs.
Regarding financial results for the year under review,
net sales increased 52,355 million yen or 16.4% year on
year to 371,932 million yen. Ordinary income increased
9,528 million yen or 63.6% to 24,505 million yen thanks togains from high utilization due to increased net sales andthe impact of initiatives to reduce costs. Net income,however, decreased 2,936 million yen or 36.1% to 5,187
million yen, because the Company recorded a provision
for product warranties as an extraordinary loss in linewith product recall on the customer side.
The Company paid out an interim dividend of 14 yen
per share in November 2012. The year-end dividend was
18 yen per share. As a result, total dividends for the year
under review, including the interim dividend, amounted to
32 yen per share, 2 yen higher than for the previous year.

Challenges and Opportunities
With regard to the world economy, domestic demand in
the U.S. is expected to remain firm and the Chinese
economy will likely continue to achieve modest growththanks to the government's economic stimulus measures.
Domestic demand is expected to be the principal driverof economic growth in Thailand and Indonesia. On theother hand, European economies are expected to remainstagnant owing to low personal consumption and tightfiscal policy. The shift of the Japanese economy onto a
recovery path is expected to become evident, assisted
by an improved export environment following theweakening of the yen, as well as by large government
expenditures and a spike in demand in the run-up to theincrease in the consumption tax. Overall, continued
growth of the world economy at a modest pace is inprospect. However, there may still be the need to be
cautious as the stagnation in the European economies
could undermine the exports of China, India and otheremerging economies.
In the automotive industry, auto sales volumes are
expected to be lower in Japan as an aftermath to the
spike in 2012 attributable to the eco-car subsidy
program, and will likely remain subdued in Europe where
personal consumption are low. In contrast, auto sales
volumes are expected to be robust in the U.S., China,
India, the ASEAN countries and other emerging-market
countries. Overall, although worldwide auto sales

volumes are expected to continue increasing, the rate of
growth is expected to slow.
Despite positive developments, such as the weakeningof the yen, the Group's business environment is expected
to remain challenging in view of intensifying competitionin the global automotive industry as well as the shrinkingof the Japanese automotive market and uncertainty of
the future posed to auto sales by the stagnation in theEuropean economies.
In these circumstances, we will accord priority tostrengthening product competitiveness and reinforcing
the earning power of each of our operations. Specifically,
we will strive to expand the scope of our initiatives toprevent major trouble occurring in our operations
overseas and also at our suppliers with the aim of further
improving quality, create new products to respond to therapid evolution of automobiles, and work to strengthen
cost competitiveness by reducing costs. By
s t re n g t h e n i n g t h e f u n d a m e n t a l s o f a l l b u s i n e s soperations in Japan and overseas, promoting local
procurement and local production, and by deploying asystem whereby our operations complement one another,
we will endeavor to rigorously control fixed costs andestablish a simple yet robust foundation for further
development of the business.
In these endeavors, we request our shareholders tofavor us with their continued support and guidance.
2Consolidated Financial Highlights
Net Sales(100 million yen)

Business Performance by Geographic Region
Ordinary Income and Net Income

Ordinary Income

4,000

3,719
3,374 3,310

3,276

3,195

203

Composition of Net Sales

126

2,000
100

81
52

50

2009

2010

2011

2012

Net Income per Share

150

2013

(Yen)

0

2009

2010

2011

2012

Return on Equity (ROE)

2013

62.8%

North America

Net sales rose 14,053 million yen (26.3%) year

Composition of Net Sales

6
57.44

57.95
50

2

11.77
0

3

2009

5.1
3.3

4

2010

2011

2012

2013

2010

on year to 67,482 million yen, mainly due to an

50

2011

2012

2013

Asia

2012

2013

sales.

year on year to 71,769 million yen, mainly due toan increase in customers' production volumes.

17.1%

Europe andelsewhere

Net sales increased 413 million yen (2.5%) year

(10.1%) to 5,803 million yen.

of 42 million yen was recorded compared with

2013

2011

2012

2013

2011

2012

2013

2011

2012

2013

15

10
250
5

0

0

2011

2012

2013

800

100

600

75

400

50

200

25

0

2011

2012

2013

4

200

3

150

2
100
1

operating income of 52 million yen for the previous year.

2012

500

0

on year to 16,783 million yen. An operating loss

2011

20

750

(405.1%) to 1,368 million yen, reflecting higher

Operating income increased 533 million yen

4.0%

0

2011

increase in customers' production volumes.

Net sales increased 14,036 million yen (24.3%)

3.1

0.7
2009

1,000

0

16.1%

Composition of Net Sales

0100

vigorous rationalization.

Operating income soared 1,098 million yen

Composition of Net Sales

8
89.95

150
2,000

income surged 9,170 million yen (122.9%) to
16,632 million yen owing to increased sales and

8.2

100

year on year to 263,660 million yen. Operating

Operating Income (100 million yen)
200

3,000

(%)

10

139.54

Net sales increased 33,827 million yen (14.7%)

51

10 10
0

Net Sales (100 million yen)

Japan

200
149

150

1,000

Net Income

245

250
200

3,000

Results by Geographical Region(100 million yen)

50

0

0

-1

2011

2012

2013

*Net sales include intersegment sales.

4Topics

Transfer Technology for Decorative Panels Receives
Award from Toyota Motor Corporation
In January 2013, Tokai Rika's project for producing gold-thread-woven-style decorative panels by 3D dry transfer printing received an award in the technology category from Toyota Motor Corporation at the line-off ceremony of the new Crown.
This technology enables transfer with high-precision positioning. Applying sequential patterns to various components creates a sense of consistency of the decor that
contributes to the enhancement of the attractiveness of the product.

Tokai Rika’s Product Fields

New Plant of Indonesian Subsidiary TRIConstruction of a new plant of subsidiary PT. Tokai Rika Indonesia (TRI) in an industrial park in Bekasi, West Java, Indonesia, was completed in April 2013. In preparation for the start of full-scale operation this autumn, equipment and facilities arebeing installed. The production capacity of this new plant will be increased to serve
the expanding
Indonesian market.

Human Machine Interface Systems, notably switches to accurately relay human commands, security systems to prevent
unauthorized access to automobiles, and safety systems to protect human lives. Wherever people and automobiles intersect,
we deliver comfort, safety and security by fully utilizing the underlying electronics technologies.

Switch/Interface

Security

Switches/Human Machine Interface Systems

Security Systems

Precise operability accurately conveying the drivers' commands, simplicity, and functional elegance are the hallmarks of our products.

Sophisticated mechanical and electronic anti-theft
functions ensure both security and ease of use.

Smart Key Portable Device
and Emergency Key

Electro Shiftmatic

Tokai Rika Create Corporation Became a Subsidiary

Tokai Rika Joins Tree-planting Event Commemorating
Local Community's 50th Anniversary

In November 2012, Tokai Rika Create Corporation (Create), which had been an affiliate, became a consolidated subsidiary. In a challenging business environment subject to fluctuating foreign currency exchange rates and raw material prices, we areestablishing a delivery structure capable of flexibly responding to needs, such as forhigh-mix low-volume production, by capitalizing on Create's trading company functions in our material procurement. Through consolidated management, we aim tostrengthen the relationship with Create to enhance corporate value.

Major merchandise
In March 2013, Oguchi-cho, Niwa-gun, Aichi Prefecture, where Tokai Rika's head
office is located, celebrated the 50th anniversary of the municipality with a treeplanting event. Our
employees volunteered
to help prepare for thisevent and take part inplanting trees. Nearly
200 people, including
our employees, plantedsome 450 oak saplings.

Multi-Function Switch

Push Start Switch

Electronics & Others

Safety Systems

Electronics & Others
Housing Facilities and Equipment

Our safety devices include seatbelts to protect drivers and passengers in the event ofcollision, stylish steering wheels optimized
for excellent handling, and mirrors thatenhance visibility.

Seatbelt for Pre-Crash
Safety System

Various industrial materials

Door Mirror with Side-Turn Lamp and Foot Illumination

Real Wood Steering Wheel**The steering wheel business is co-operated with Toyoda Gosei Co., Ltd.

Automotive Electronics
Products

Applying technologies originallyemployed in automotive
applications, we offer convenient
products meeting today's
housing-security needs.

Automotive Accessories

Housing Equipment

Immobilizer

SafetyLa Lock Hallway Immobilizer Key System

Components for agricultural and construction equipment
5

Remote Key and Receiver

We are a source of vehicle
décor with design flair.
These products allow
owners to enhance theappeal of their vehicles
through customization.

Power Supply ECU

We o f f e r p r o d u c t s f o r
function control and status
detection as well as various
types of connectors in
response to the ongoing
computerization of
automobile controls.
6

Consolidated Financial Statements

Stock Information/Dividends

Consolidated Balance Sheets (Millions of yen)

Stock Information (as of March 31, 2013)

As of March
31, 2013

As of March
31, 2012

178,585

156,598

Cash and deposits

27,143

21,749ASSETS
Current assets

Notes and accounts receivable

50,65854,954

Electronically recorded monetary claims-operating

10,6744,627

Marketable securities

47,08940,243Inventories

26,84423,004

Other current assets

16,17412,018129,454

116,619

Tangible fixed assets

82,27972,870Intangible fixed assets

1,617

1,601

Inventories and other assets

45,55742,147

Investment securities

30,877

26,705

Other

14,67915,441

Fixed assets

Total assets

273,217

As of March
31, 2012

99,67452,575
5,867
41,231
24,4895,755
18,733
124,164

84,34050,2407,234
26,86523,678
5,956
17,722
108,018

174,43122,85625,135
133,479(7,039)(381)
1,865(2,246)642
9,182
183,875
308,039

171,375
22,85625,134130,434(7,049)(10,293)(278)(10,015)777
3,339
165,198
273,217

Consolidated Statements of Income (Millions of yen)

Consolidated Cash Flow Statements (Millions of yen)

Year ended
Year ended
March 31, 2013 March 31, 2012

Year ended
Year ended
March 31, 2013 March 31, 2012

Net sales
Cost of sales
Gross profit
Selling, general and administrative expenses
Operating income
Non-operating income
Non-operating expenses
Ordinary income
Extraordinary gains
Extraordinary losses
Income before income taxes and minority interests
Income taxes-current
Income taxes-deferred
Income before minority interests
Minority interests in income
Net income
7308,039

LIABILITIESCurrent liabilities
Notes and accounts payable
Short-term borrowings
Other current liabilities
Long-term liabilities
Long-term borrowings
Other long-term liabilities
Total liabilities
NET ASSETS
Shareholders’ equity
Common stock
Capital surplus
Retained earnings
Less: Treasury stock, at cost
Accumulated other comprehensive income
Net unrealized loss on available-for-sale securities
Foreign currency translation adjustments
Stock acquisition rights
Minority interests
Total net assets
Total liabilities and net assets

As of March
31, 2013

371,932
320,269
51,66328,42423,2381,704
438
24,505818
15,7009,622
6,729(2,822)
5,715
527
5,187

319,577
280,552
39,02525,86813,1562,364
543
14,977103524
14,556
2,734
3,587
8,234
110
8,123

Cash flows from operating activities

32,767

13,833

Cash flows from investing activities(18,487)(22,341)

Cash flows from financing activities(5,005)(1,827)

2,366

(545)

11,640(10,881)

Cash and cash equivalents at beginning of year

56,581

67,462

Increase (decrease) in cash and cash
equivalents resulting from changes in fiscal
year-ends of consolidated subsidiaries

(112)

—

Cash and cash equivalents at end of year

68,110Effect of foreign currency translation
adjustments on cash and cash equivalents
Net increase (decrease) in cash andcash equivalents

Composition of Shareholders by Shareholder Type

Total number of shares
Total number of shares authorized to be issued:
Number of shares issued and outstanding:

200,000,000
94,234,171
8,983

Number of shareholders:

Treasury stock

4.2%

Major shareholders (Top 10)

Toyota Motor Corporation
Denso Corporation
Japan Trustee Services Bank, Ltd. (Trust Account)
The Master Trust Bank of Japan, Ltd. (Trust Account)
The Dai-ichi Life Insurance Company, Limited
Northern Trust Company AVFC Re Northern
Trust Guernsey Irish ClientsJapan Trustee Services Bank, Ltd. (Trust Account 9)
Tokai Rika Employee Stock Ownership Plan
The Chase Manhattan Bank, N.A. London
Secs Lending Omnibus Account
Tokai Rika Kyoeikai

29,367
8,839
4,036
3,978
2,275

31.16
9.38
4.28
4.22
2.41

1,435

1.52

1,289
1,172

1.36
1.24

1,029

1.09

842

0.89

0.6%

Individuals

EquityNumber of shares(thousands of shares) participation (%)

Shareholder

Securities firms

12.2%
Total number of shares

Foreign entities

16.7%

94,234,171

Corporations in
Japan

45.2%

Financial institutions

21.1%

Note: The Company holds 3,915 thousand shares of treasury stock but is excluded
from the major shareholders stated above.

Cash Dividends(Yen)

Full year

InterimAt the 66th annual general meeting of

40

32

32

30

30

30

shareholders held on June 12, 2013, the32

Company's proposal to pay the year-end
dividend to shareholders on the record

24date of March 31, 2013, was approved.

20

16

14

8

10

0

14

2009

2010

2011

2012

2013

1

Year-end cash dividend

18 yen per share

2

Effective date for year-end dividend(payment commencement date)June 13, 2013

56,581
8

Company Information (as of March 31, 2013)
Global Network

Corporate overview

Tokai Rika is establishing globally standardized business processes in a manufacturing system consistentfrom development through to production and quality assurance.

Company name:TOKAI RIKA CO., LTD.
Establishment:
August 30, 1948

Gifu Pref.
ENA TOKAI RIKA Co., Ltd.

Paid-in capital:
22.8 billion yen

NSK Co., Ltd.

Tohoku Technical Center

Head Office &Plant

RIKASEIKI CO., LTD.
Tokai Rika Create Corporation

Osaka Office

Toyota Plant
TRMAC ENGINEERING Co., Ltd.

Tokyo Office

Hiroshima Office

TOKAI RIKASERVICE Co., Ltd.

5,971 (non-consolidated)

Aichi Pref.
Hagi Plant

Otowa Plant

TOKAI RIKA
ELETEC CO., LTD.

MIROKU TECHNO WOOD Co., Ltd.

Number of employees:
16,192 (consolidated)

Head office:3-260 Toyota, Oguchi-cho, Niwa-gun, Aichi 480-0195, Japan

TRCZ s.r.o.

Wuxi Risho Technology Co., Ltd.

Sales of automotive parts

Production of automotive switches,seat belts, and push start systems

Production of seat belts and molds*President

Yuzo Ushiyama

Consolidated subsidiaries:
34
Affiliates accounted for by the equity method:
7*Executive Vice President Kenji Miura

Senior Managing Director Masaharu Tanino*Executive Vice President Yoshihiro Obayashi

Senior Managing Director Kouji Buma

Senior Managing Director Shoji Ishida

Managing Director Mikihiro Mori

Senior Managing Director Mineo Hattori

Managing Director Koki Sato

Senior Managing Director Tadanao Hamamoto

Managing Director Yoshihiro Tanaka

Senior Managing Director Kenji Kawaguchi

Director

Shinji Shirasaki

Senior Managing Director Tadashi Wakiya
Audit & Supervisory
Board Member

Hiroshi Nishio

Audit & Supervisory
Board Member

Kyoji Sasazu

Audit & Supervisory
Board Member

Yuji Nishimura

Audit & Supervisory
Board Member

Kiyotaka Ise

Audit & Supervisory
Board Member

Masaki Horie

Corporate Officer (withMikio KatoManaging Director status)

Corporate Officer

Shigeru Hayashi

Corporate Officer

Kazuhiko Noguchi

Corporate Officer

Isaki Sugiura

Corporate Officer

Masakazu Goto

Corporate Officer

Kazuhiro Ikai

Corporate Officer

Toshimasa Yamamoto

Corporate Officer

Toshiki Nogami

Corporate Officer

Toshiki Akita

Tianjin Tokairika Automotive Parts Co., Ltd.
Production of automotive switches
Foshan Tokairika Automotive Parts Co., Ltd.
Production of keys, locks, shift levers,
and automotive switches

TRQSS,Inc.
DAEDONG CO., LTD.

TRMI,Inc.

Production of automotive
switches, keys and locks

Production of
automotive switches

Production of seat belts

TGR Technical Center,LLC
Testing and evaluation

TRB Limited
Production of
automotive switches

Senior Managing Director Hiroyuki Nakamura

Tel: +81-587-95-5211

SANDENZAISHA CO., LTD.

Tokai Rika Belgium N.V.

Executive Management (as of June 12, 2013)

TOKAI RIKA (THAILAND) CO., LTD.
Production of automotive switches,
keys and locks

TRAM,Inc.

MINDARIKA PRIVATE LIMITED
Production of automotive switches

TAC Manufacturing,Inc.

Holding company in North America,
sales, technology development

Production of steering wheels,keys and locks, and shift levers
TOKAI RIKA MINDA INDIA Private Limited.

TRIN,Inc.

Production of seat belts, keys and locks

Rica Auto Parts Co., Ltd.
PT.TOKAI RIKA INDONESIA

Production of automotive switches

Production of automotive switches,
keys, locks and shift levers

Note: Persons marked with an asterisk (*) are representative directors.

Production of automotive switches, keys and locks
Thai Seat Belt Co., Ltd.
Production of seat belts

9

TOKAI RIKA ASIA CO.,LTD.

PT.TOKAI RIKA SAFETY INDONESIATRP,Inc.

TRBR INDUSTRIA E COMERCIO LTDA.

Holding company in ASEAN

Production of seat belts

Production of
automotive switches

Production of automotive switches
and shift levers

Major consolidated subsidiaries
Major affiliates
Other offices

10Shareholder Information
Business year
Annual general meetingof shareholders
Record date for
distribution of surplus
Number of sharesconstituting one unit of stock
Stock code
Transfer agent
Agency administration
officeFor inquiry/postal
address

Listing stock
exchanges
Method of public
noticeFrom April 1 to March 31 of the following year
June

Visit Our Website

Year-end dividend: March 31
Interim dividend: September 30
100 shares

The Tokai Rika Website provides a range of

6995
Sumitomo Mitsui Trust Bank, Ltd.
1-4-1 Marunouchi, Chiyoda-ku, Tokyo
Stock Transfer Agent Department, Sumitomo Mitsui Trust Bank, Ltd.
3-15-33 Sakae, Naka-ku, Nagoya
Stock Transfer Agent Department, Sumitomo Mitsui Trust Bank, Ltd.
2-8-4 Izumi, Suginami-ku, Tokyo 168-0063
Tel: 0120-782-031 (toll free in Japan)
Website:http://www.smtb.jp/personal/agency/index.html
Tokyo Stock Exchange, Nagoya Stock Exchange

to visit us online.

information on the Company. Public notices arealso posted on the website. We encourage you

http://www.tokai-rika.co.jp/

Electronic public notice at http://www.tokai-rika.co.jp/
If electronic public notice is unavailable, the Company
shall post a public notice in the Nihon Keizai Shimbun.

Notice1. Receipt of uncollected dividends
Please contact the transfer agent Sumitomo Mitsui Trust Bank, Ltd.
Please note that under the Articles of Incorporation of the Company,
the Company is not obliged to pay dividends that are unclaimed forthree full years from the date on which they first became payable. You
are requested to collect your dividends at your earliest convenience.
2.	Address change, purchase and sale of shares constituting lessthan one trading unit, and specification of the method of receiving
dividends
Please contact the securities firm with which you have your securities
account. If you have a special account, please contact Sumitomo
Mitsui Trust Bank, Ltd., which is the agent for managing special
accounts.
3. Dividend Statement
A dividend statement sent by the Company to shareholders upon payment of dividends also serves as the payment advice pursuant to the
Act on Special Measures concerning Taxation. It may be used as evidence when filing a final tax return.
*Please retain the dividend statement for your final tax return.
Vegetable oil ink and FSC-certified paper are used for the
purpose of protecting the environment.