Company Introduction

Strategies and Businesses

Promotion of ESG Initiatives

Corporate Information

Value Creation Process

Value Creation Process
Based on our basic philosophy, we aim to contribute to making the earth a better place to live, enrich lifestyles andpromote a compassionate society by directly facing the changes and challenges surrounding society and by engaging
in value creation through making the most of the core assets and strengths we have accumulated to date in promoting
our diverse businesses.

Social Issues and Changes
Electrification / Climate change / Issues on energy, resources and water / Labor shortages and rising labor costs /Digitalization and online systematization / Work style diversification

Primary Capital and Strengths

Aspiration in the Medium to Long Term and CSR Materiality

INPUT Human Capital Human resources comprised of more than 60,000
employees possessing diverse strengths in respective
business fields
 Human resources development underlying sustainablegrowth Vision 2030
Contribute to making the earth a better place to live, enrich lifestyles, andpromote a compassionate society by supporting industrial and social
infrastructure around the world through the continuous supply of
products/services that anticipate customers’ needs.

 Product Development Capability / Intellectual
Capital Global sales and service networks for materials handlingequipment and other products
 Close collaboration with Toyota Group companies as well
as automakers and other manufacturers around theworld Business reinforcement and expansion through M&A
and other measures Solid supply chain built on mutual cooperation withbusiness partners

 Natural Capital

OUTCOME Materials Handling Equipment

 Customers
Contributing to such needs as electrification, automation andenergy savings as well as safety and reliability throughhigh-quality products and services

Lift trucks and logistics
solutions that contribute to
greater logistics efficiency
for customers

Fuel-efficient and clean engines

 CSR Materiality
CSR Materiality

SDGs to Contribute

Car air-conditioning compressors thatrealize a comfortable vehicle interior Mitigation of Global Warming Contribution to Circular Economy
Resolving Social
Issues throughOur Business

Foundation
Supporting
Our Business
Operations

Electronics that contribute to theelectrification of automobiles, etc.

 Creation of Innovative Values Products and Services WhichContribute to Safety, Reliability andComfort Mutual Prosperity throughPartnerships with Local Communities Textile Machinery Safe and Healthy Work Environments
 Leveraging Diversity and Inclusion
 Sustainable Procurement Compliance and Risk Management

Weaving and spinning machinery to produce fabrics
and yarns of high quality and soft texture
Link to CSR
Materiality

 Air, water, energy, minerals, etc.

Toyoda Precepts
4

Toyota Industries Report 2021

 Business Partners
Co-existence and co-prosperity based on mutual trust
cultivated through open, fair and equitable business
relationships

 Shareholders and Investors
Returning profits to shareholders and investors by enhancing
corporate value through sustainable growth

Link to details on
Vision 2030

 Financial Capital Global Network / Social and Relationship Capital

OUTPUT

Comfortable and appealing
automobiles

 Manufacturing Capability / Manufacturing
Capital Sound financial foundation
 High rating bestowed by rating agencies (fundprocurement capability)

Values and Joys for Stakeholders

 Automobile Strengthening development capability andcompetitiveness through collaboration between the
Materials Handling Equipment and Automobile-related
businesses Accumulation of knowledge thanks to involvement in the
production of automobiles spanning from vehicle
assembly to the development of key components
 Wide-ranging responsiveness and sustainable growthpotential stemming from technologies in thedevelopment of both engines and electrification
 Research and development by drawing on external
expertise World-leading quality and productivity based on the
Toyota Production System Globally stable production and supply capabilities ofrespective businesses

Business Results

 Employees
Developing employees’ work values and motivating them todemonstrate their potential by creating safe and secure
workplaces for diverse human resources Local Communities
Contributing to the prosperity of each country and local
community through promoting social welfare, youth
development, environmental protection, community
contribution and other activities
 Global Environment
Contributing to reducing CO2 emissions, mitigating resource
depletion and curtailing environmental risks by promoting
environmental management

Basic Philosophy
5Company Introduction

 Mitigation of Global Warming Contribution to Circular Economy
SDGs to Contribute

Clean/zero emissions:
Mitigating global warming and achieving
a circular economy through suchinitiatives as reducing CO2 emissions
and waste in our business activities andexpanding the lineup of environmentallyfriendly products in our efforts tocontribute to maintaining and improving
the global environment over the long run

Identifying, among various social issues, the ones
relevant to our business activities based on the United
Nations’ 17 Sustainable Development Goals (SDGs)
and 169 targets as well as guidelines
Link todetails[Items we refer to]1) 17 SDGs and 169 targets
2) Important ESG items

Action Policies

 Reducing CO2 emissions from production activities Reducing CO2 emissions from production-related
logistics
 Reducing CO2 emissions through product andtechnology development

Validation of Adequacy

Assessment of Importance
Assessing the importance of the identified issues from both internal andexternal viewpoints to select those having higher degrees of importance[Assessment method]1) Conducting questionnaires anddiscussions with relevant internal
departments
2) Plotting onto a 2 x 2 materiality matrix
to select issues having higher degrees
of importanceImportance whenviewed from outside

Identification of Issues Relevant to
Toyota Industries

Conducting reviews by both
our top management andoutside experts to receive
feedback and confirm theadequacy of the selectedissuesAction Targets and Activities Creation of Innovative Values
SDGs to Contribute Products and Services WhichContribute to Safety, Reliability
and Comfort
 Mutual Prosperity throughPartnerships with Local
Communities

Creation of innovative value, smart:
Contributing to achieving a “smart”
society and more enriched lifestyles
by resolving social issues throughtechnological advancement andinnovation that create new values

Safe/reliable, comfortable:
Contributing to creating a compassionate
society by offering products and services
that anticipate the needs of customers
and various stakeholders and that aresafe, reliable and comfortable to use
while fulfilling our responsibilities as amember of society to thrive together

SDGs to Contribute Promoting development of new technologies thatcreate new values
 Improving core technologies and utilizing the
new knowledge of business partners to enter
into peripheral fields of existing businesses whiledeveloping and offering technologies and products innew business fields
 Enhancing electrification-related products andservices that are highly functional, ecologically soundand adaptable as social infrastructure Offering high-quality and safe products and services
and maintaining and improving the structure to realize
this goal Continuously promoting grassroots activities in local
communities and thrive together as a member ofsociety Reduce production-derived CO2 emissions
Total emissions(FY toachieve)

Results for
FY2021Page
numberTargets for
FY2022–25%*(2026)–28%

P. 66–67—

15％(2026)

6%

P. 66–67—–11%(2026)–8%

P. 66–67——

P. 66–67—–22%

P. 67–68

—

—

P. 68

—

—

P. 67–68

—

57.6%
—
—

—
—
—

(vs FY14 level) Adopt renewable energy sources
Introduction rate Reduce logistics-derived CO2 emissions
Emission volume per unit of production (non-consolidated)(vs FY14 level) Develop technologies that contribute to an even greater level of energy efficiency
Emission volume per unit of production (non-consolidated)［参考にした項目］① SDGs（17ゴール、169ターゲット） Promote water conservation activities corresponding to the water situations in each
② ESGの重要項目–12%(vs FY14 level)(2026)

 Reduce use of resources and promote reuse and recycling of resources Ratio of R&D expenses for electrification and automation
 Expand peripheral fields and new business fields Net sales

70%¥1trillion

Over
Over

(2031)(2031)Develop new technologies and products that contribute to resolving environmental and social issues

—

—

70%

(2031)

43%

—

45%

Offer highly efficient and energy-saving electric compressors that are excellent in terms of quiet
operation and comfort (Automobile Business)—

P. 35–36—

Offer clean and high-quality fuel cell units and on-board batteries (Automobile and Materials Handling
Equipment businesses)

—

—

—

—

P. 37

—

 Expand sales of electrification-related products (all businesses)
Ratio of electrification-related products to net sales

Over

Offer power source-related products, on-board or otherwise, that can also be used as social infrastructure during
disasters and other occasions (Automobile Business)(2031)
100%
 Conduct product risk assessment (target products) Implementation rate (non-consolidated)

100%(2031)

Contribute to biodiversity conservation of local communities
Promote other community contribution activities

Foundation
Supporting
Our
Business
Operations

 Creating the environment for everyone to get a fairshare of opportunity to develop and demonstrate theirpotential

 Leveraging Diversity andInclusion Sustainable Procurement Compliance and Risk
Management

 Establishing the foundation to remain a company thatis trusted and needed by society——(2031)(vs FY2021)

 Promote social contribution activities
Expenditure/number of participants Safe and Healthy Work
Environments

60%
—

Over

Twofold(100%)Develop new technologies and products for logistics automation and expand sales(Materials Handling Equipment)
Sales of automation products (growth rate) Promote quality education Training participation rate (non-consolidated) Fostering safe and healthy workplaces for everyone

Gaining approval of the CSR
Committee chaired by thepresident and comprising our top
management based on thevalidation results

Targets

country and region

 Implementing initiatives to promote 3R (reduce, reuse
and recycle) design for effective resource utilization

Approval by
Top Management

Importance for Toyota Industries

 Reduce waste generation volume
 Effective resource utilization in production activities

ResolvingSocialIssuesthrough Our
Business

Corporate Information

Process to Determine CSR Materiality

Under the Toyoda Precepts (corporate creed), Toyota Industries has been undertaking abroad range of businesses by upholding the philosophy of contributing to society since its
founding. In keeping with recent changes in the business environment, we have clarified
which social issues we should tackle as our CSR material issues, and will work for the
resolution of these issues.
Contribution to Vision 2030
(Aspiration)

Promotion of ESG Initiatives

Contributing to SDGs throughBusiness Activities

Contributing to SDGs throughBusiness Activities

CSR Materiality

Strategies and Businesses Eliminate serious accidents Number of serious accidents
Frequency rate of lost workday injuries (non-consolidated) Utilize diverse human resources
Ratio of female managers (non-consolidated)
Ratio of employees with disabilities (non-consolidated)

00.00(2031)

3.6%(2031)

1.6%

P. 53–54

2.30%(2031)

2.40%

P. 54

Over

(2031)

 Maintain sound transactions and strengthen structure throughout the supply chain
Implementation rate of CSR checks on target suppliers (non-consolidated) Eliminate serious compliance violations Number of violations

100%(2031)

0(2031)

100%(955 companies)00(2031)—
0 Promote risk management activities taking a risk-based approach
Improve BCP effectivenessRespond to cybersecurity risks Number of serious incidents

P. 48–49
100%
P. 49
100%
¥840 million/
P. 59
18,224 persons
P. 69
—
P.
58–59
—
P. 56
2
P. 56
0.09

P. 50
P. 43
P. 45–46
P. 45

Up

10%

100%
100%
—
—
—
0
0.00
—
Over

2.30%

100%
(950 companies)
0—0* As a more ambitious target, we are aiming for a 50% reduction by fiscal 2031 from the fiscal 2014 level.

6

Toyota Industries Report 2021

7

Company Introduction

Strategies and Businesses

Promotion of ESG Initiatives

Corporate Information

Business Overview

Business Overview
Using our resources and strengths as the foundation, we strive for growth in the Materials
Handling Equipment, Automobile and Textile Machinery businesses. At the same time,
we aim to enhance our competitiveness by leveraging synergies among these businesses.

Link toproduct
details

Materials Handling Equipment
Lift Truck

Logistics Solutions

Toyota Industries plans, develops,
produces, sells and provides
after-sales services for industrial
vehicles centered around lift trucks,
which capture the top global market
share*. Together with sales
financing and proposals for logistics
efficiencies, we strive to meet avariety of customer needs.

Toyota Industries works closely with subsidiaries Bastian Solutions LLC
and Vanderlande Industries Holding B.V. by leveraging each company’s
strengths to contribute to resolving customers’ logistics issues througha combination of various logistics equipment and systems.

Net Sales(¥ Billion)

Net Sales
High-speed storage
and picking system

Electric lift truck

2,500

2,118.3 billion¥

Airport baggage handlingsystem2,214.9

2,171.3

2,118.3

2019

2020

2021

Operating
Profit(¥ Billion)

2,000
1,500

FY20211,000

Automobile

500

VehicleEngineWith its strengths as a leader in safety, the environment, quality,
cost and delivery among Toyota Group companies, the Vehicle
Business plans, develops and produces the RAV4 for markets inand outside Japan.

In addition to automotive diesel engines produced under astructure ranging from planning and development to production,
we also produce gasoline engines and industrial engines.

RAV4

Car Air-Conditioning Compressor

Electronics

Toyota Industries’ car air-conditioning
compressors are highly acclaimed interms of their reliability at high operating
speeds and quiet operation in addition tosuch excellent environmental
performance features as compactness,light weight and fuel efficiency. The Car
Air-Conditioning Compressor Business
captures the world-leading market sharein unit sales*.

The Electronics Business plans, develops and produces a wide
variety of electronics products for electrified vehicles such as hybrid
vehicles.
Electric compressor

DC-DC converter

68% Materials Handling Equipment ¥1,431.4 billion¥591.6 billion
28% Automobile¥40.8 billion
2% Textile Machinery

Gasoline engine
for hybrid vehicles

Diesel engine

Oxygen-supplying
air compressor forfuel cell vehicles

0(FY)

Materials
Handling
Equipment

On-board charger

Textile Machinery

Automobile

Textile MachineryWe undertake fully integrated operations
from planning, development andproduction to sales and after-sales
services for spinning machines that spin
twisted fiber bundles into yarn andweaving machines that weave spun yarn
into fabrics. Our air-jet looms havecaptured the world-leading market sharein terms of unit sales*.

Textile Machinery
Air-jet loom

Ring spinning frame

The lift truck market grew in China but
shrank in other countries and regions, andToyota Industries’ unit sales decreased
from the previous fiscal year. Meanwhile,
sales of the Logistics Solutions Businessincreased in step with an expansion of the
e-commerce market. As a result, net sales
were on par with the previous fiscal year at¥1,431.4 billion.

The automobile market as a wholecontracted despite a recovery trend in
China. Amid this climate, although sales of
the RAV4 were on par with the previous
fiscal year, sales of engines and car
air-conditioning compressors decreased.
As a result, net sales totaled ¥591.6 billion,
down ¥22.2 billion, or 4%.

Amid difficult market conditions overall,
net sales amounted to ¥40.8 billion, down
¥20.9 billion, or 34%, as a result of
decreases in sales of weaving machinesand quality measurement instruments forfiber, yarn and fabric.

Net Sales(¥ Billion)

1,500
1,200
900

40
20

300
(FY) 19

Net Sales

20

0

21

(FY) 19

Operating
Profit(¥ Billion)

600

200

10

20

80
60

20

21

20

21

(¥ Billion)

8
6
4

40

2

20
(FY) 19(FY) 19

Operating
Profit(Loss)(¥ Billion)

0

0

21

21

30
20

(FY) 1920(¥ Billion)

400

0

Net Sales

100
80
60

600
0

120

0

20

21

-2

(FY) 19* Survey by Toyota Industries Corporation

8

Toyota Industries Report 2021

9

Company Introduction

Strategies and Businesses

Promotion of ESG Initiatives

Corporate Information

Consolidated Eleven-Year Summary

Consolidated Eleven-Year Summary
Link todetails

Toyota Industries Corporation
Years ended March 31

Millions of yen
International Financial Reporting
2021

2020

Standards (IFRS)Generally Accepted Accounting Principles in Japan (JGAAP)

2019

2018

2017

2016

2015

2014

2013

2012

2011

For the YearNet sales

2,118,302

2,171,355

2,214,946

2,003,973

1,675,148

2,243,220

2,166,661

2,007,856

1,615,244

1,543,352

1,479,839

Operating profit

118,159

128,233

134,684

147,445

127,345

134,712

117,574

107,691

77,09870,092

68,798

Profit before income taxes*1

184,011

196,288202,225

209,827

181,986

185,398

170,827

138,133

86,83680,86673,911

Profit*2

136,700

145,881

152,748

168,180

131,398

183,036

115,263

91,705

53,11958,59447,205Investments in tangible assets*3

113,361

106,058

113,748

115,458

77,39375,438126,395

109,479

89,45958,404

38,254

Depreciation*3

91,09790,48885,63977,73873,25377,36670,78264,153

57,954

59,83062,372

Research and development expenses

88,90090,56088,807

77,647

69,52465,44047,78546,32639,05732,07027,788Basic

440.28469.85491.97541.67420.78582.58367.06292.76170.36188.02151.51

Diluted

—

—

—

—

—

582.57366.99292.57170.35——

10,422.64

7,854.87

7,986.59

8,223.82

7,125.37

6,481.97

7,500.16

5,640.08

4,719.66

3,662.26

3,300.17

150.00160.00155.00150.00125.00120.00110.00

85.00

55.00

50.00

50.00

Total assets

6,503,986

5,279,653

5,261,174

5,258,500

4,558,212

4,199,196

4,650,896

3,799,010

3,243,779

2,656,984

2,481,452

Share of equity attributable to owners of the parent

3,236,038

2,438,807

2,479,718

2,553,391

2,240,293

2,113,948

2,425,929

1,829,326

1,524,933

1,197,841

1,075,939

Per share of common stock (yen):
Earnings per share*2, *4

Share of equity attributable to owners of the parent
Cash dividends per share
At year-end

Capital stock

80,46280,46280,46280,46280,46280,46280,46280,46280,46280,46280,462

Number of shares outstanding (excluding treasury stock) (thousands)

310,481

310,483

310,485

310,487

310,489314,226

314,155

313,730

312,207311,687

311,564

Net cash provided by operating activities

382,386

313,199

270,306

268,567

239,094

240,169

182,191

155,059

151,299

101,718

153,661

Net cash used in investing activities(404,164)(182,598)(395,000)(340,324)(86,925)(531,561)(160,769)(118,483)(274,210)(9,403)(187,574)

Net cash provided by (used in) financing activities(105,477)(7,094)

40,467

153,303789

130,923(8,918)

6,183

7,050

10,279(85,728)

Cash and cash equivalents at end of year

238,248

358,144

239,140

323,830

243,685

92,399248,706

226,406

179,359

296,811

195,566

Cash flows

Indices
Operating profit ratio (%)

5.6

5.9

6.1

7.4

7.6

6.0

5.4

5.4

4.8

4.5

4.6

EBITDA (millions of yen)*5

326,851

336,415

323,998

313,055

276,193369,857

248,854

216,175

155,234

161,876

150,481Return on equity (ROE) (%)*6

4.8

5.9

6.1

7.0

6.1

8.3

5.6

5.7

4.1

5.4

4.5

Return on assets (ROA) (%)*7

2.3

2.8

2.9

3.4

3.0

4.1

2.7

2.6

1.8

2.3

1.9

D/E ratio (%)*8

41.6

54.9

52.3

45.7

43.6

43.7

32.0

39.9

45.4

53.8

56.8

Ratio of share of equity attributable to owners of the parent*9

49.8

46.2

47.1

48.6

49.1

48.5

50.7

46.6

45.4

43.0

41.4

66,947

66,47864,641

61,152

52,62351,45852,52349,33347,41243,51640,825

Number of employees (persons)*1: The figures prior to fiscal 2017 are ordinary income under JGAAP.
*2: Profit attributable to owners of the parent*3: Investments in tangible assets and depreciation apply to property, plant and equipment. They do not include materials handling equipment leased
under operating leases.
*4: Earnings per share is computed on the average number of shares for each year.
*5: Profit before income taxes + Interest expenses – Interest and dividends income + Depreciation and amortization (including assets other than property,
plant and equipment)*6: Profit attributable to owners of the parent / Average share of equity attributable to owners of the parent at the beginning and the end of the
fiscal year
*7: Profit attributable to owners of the parent / Average total assets at the beginning and the end of the fiscal year
*8: Interest-bearing debt / (Share of equity attributable to owners of the parent – Subscription rights to shares)*9: (Share of equity attributable to owners of the parent – Subscription rights to shares) / Total assets
Notes: 1. Toyota Industries has adopted IFRS beginning from the end of fiscal 2017.
2. Operating profit in fiscal 2018 includes a one-time effect of ¥14.3 billion arising from changes in retirement benefit plans.

10

Toyota Industries Report 202111