TOKYO ELECTRON

Summary of Consolidated Financial Results for the Third Quarter Ended
December 31, 2017 (Japanese GAAP)

January 30, 2018

Name of Listed Company:
Security Code:
URL:
Representative:
Contact:

Tokyo Electron Limited
Stock Exchange Listing: Tokyo8035
http://www.tel.com
Toshiki Kawai, Representative Director, President & CEO
Tetsuro Hori, Representative Director, CFO, Executive Vice President
Telephone: +81-3-5561-7000
Scheduled start date of dividends payment: Preparation of supplementary materials for the quarterly financial results: Yes
Quarterly earnings release conference: Yes (for investors and analysts)
Note: Amounts are rounded down to the nearest million yen.
1. Consolidated Financial Results for the Nine Months Ended December 31, 2017 (April 1, 2017 to December 31, 2017)(1) Consolidated Operating Results (Cumulative)
Note: Percentages indicate changes from the same period of the previous fiscal year.
Nine months ended
December 31, 2016

December 31, 2017%%

Net sales (Millions of yen)

539,087

7.9

774,750

43.7

Operating income (Millions of yen)

94,1608.5

181,411

92.7

Ordinary income (Millions of yen)

95,692

8.7

180,426

88.5

Net income attributable to owners of parent (Millions of yen)

67,91814.7

131,384

93.4

Net income per share of common stock (Yen):
Basic
DilutedComprehensive income:

414.01800.71

412.90797.98Nine months ended December 31, 2017:

144,220 million yen, 110.3%

Nine months ended December 31, 2016:

68,563 million yen, 25.9%(2) Consolidated Financial Position
As ofMarch 31, 2017

December 31, 2017

Total assets (Millions of yen)

957,447

1,091,505

Total net assets (Millions of yen)

645,999

709,582

67.2

64.6

Equity ratio (%)
Equity:705,185 million yen (as of December 31, 2017)
643,094 million yen (as of March 31, 2017)

2. Dividends
Year ended

Year ending

March 31, 2017

March 31, 2018

1Q-end dividends per share (Yen)--

2Q-end dividends per share (Yen)

128.00277.00--Year-end dividends per share (Yen)

224.00328.00 (Forecast)

Annual dividends per share (Yen)352.00605.00 (Forecast)

3Q-end dividends per share (Yen)

Note: Revision to the dividends forecast most recently announced: None

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TOKYO ELECTRON

3. Financial Forecasts for the Year Ending March 31, 2018 (April 1, 2017 to March 31, 2018)
Note: Percentages for year ending March 31, 2018 indicate changes from the previous fiscal year.
Year ending
March 31, 2018%
Net sales (Millions of yen)

1,130,000

41.3

Operating income (Millions of yen)

271,000

74.1

Ordinary income (Millions of yen)

271,000

72.0

Net income attributable to owners of parent (Millions of yen)

198,000

71.9

Net income per share (Yen)

1,206.66

Note: Revision to the financial forecasts most recently announced: None

Notes
(1) Changes in significant subsidiaries during the period(Changes in specified subsidiaries associated with changes in scope of consolidation): Yes
New: 0 company (-) Excluded: 1 company (Tokyo Electron Tohoku Ltd.)
Please refer to "Notes" on page 11 for further information.
(2) Adoption of special accounting methods for preparation of quarterly financial statements: Yes
Please refer to "Notes" on page 11 for further information.
(3) Changes in accounting policies, changes in accounting estimates and restatements
1. Changes in accounting policies along with changes in accounting standards: None
2. Other changes of accounting policies besides the number 1 above: None
3. Changes in accounting estimates: None
4. Restatements: None
(4) Number of shares issued and outstanding (common stock)
1. Number of shares issued and outstanding (including treasury stock)
As of December 31, 2017 :

165,210,911 shares

As of March 31, 2017 :

165,210,911 shares

2. Number of shares of treasury stock
As of December 31, 2017:

1,106,038 shares

As of March 31, 2017:

1,135,104 shares

3. Average number of shares outstanding (Cumulative quarterly period)
Nine months ended December 31, 2017:

164,083,989 shares

Nine months ended December 31, 2016:

164,049,252 shares* Status of implementation of quarterly review proceduresThis Summary of Consolidated Financial Results is outside the scope of the quarterly review procedures under the Financial
Instruments and Exchange Act.
* Explanation of the appropriate use of financial forecast:
The financial forecasts and estimates in this Summary of Consolidated Financial Results are based on information available to
the Company at the time of report issuance and certain assumptions judged to be reasonable by the Company, and therefore
are not guarantees of future performance. Consequently, actual results may differ substantially from those described in thisSummary of Consolidated Financial Results. Please refer to "1. Qualitative Information on Financial Results for the Current
Quarter (3) Description of Financial Estimates Information such as Consolidated Financial Forecasts" on page 6.
The Company plans to hold an earnings release conference for investors and analysts on January 30, 2018.
Supplementary materials to be handed out at the conference will be posted simultaneously on the Company's website.

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TOKYO ELECTRON

1. Qualitative Information on Financial Results for the Current Quarter(1) Description of Operating Results
For the first three quarters of the current fiscal year, both the U.S. and EU economic recovery has been steady andthe Chinese economy remained stable, reflecting the gradual recovery in the global economy overall.
In the electronics industry, where the Tokyo Electron (TEL) Group operates, there was robust demand for memory
used in data centers and smartphones resulting from the increased volume in data transmission between electronic
devices, and as a result, market conditions for semiconductors and electronic components remain favorable.
Under these circumstances, the consolidated financial results (cumulative) for the first three quarters of the current
fiscal year were net sales of 774,750 million yen (year-on-year growth of 43.7%), operating income of 181,411 million
yen (year-on-year growth of 92.7%), ordinary income of 180,426 million yen (year-on-year growth of 88.5%) and net
income attributable to owners of parent of 131,384 million yen (year-on-year growth of 93.4%).

The overview of each business segment is as described below.

(i) Semiconductor Production Equipment
The supply of DRAM and NAND flash memory continued to be constrained against the backdrop of strong demand
for semiconductors used in data centers, which has driven increased capital investment to support growth in memory
devices. Furthermore, in terms of logic semiconductors, there has also been capital investment to support increased
server demand. As a result, the semiconductor production equipment market conditions were favorable. Under thesecircumstances, net sales to external customers in this segment for the first three quarters of the current fiscal year
were 729,154 million yen (year-on-year growth of 44.0%).

(ii) Flat Panel Display (FPD) Production Equipment
The market including China for production equipment used for large-sized LCD panels for televisions continues toexpand. In addition, capital investment in small to medium-sized flat panel displays for mobile devices has continued,
which leads to favorable market conditions for FPD production equipment. Consequently, net sales to externalcustomers in this segment for the first three quarters of the current fiscal year were 45,289 million yen (year-on-year
growth of 39.9%).

(iii) Other
Net sales to external customers in this segment for the first three quarters of the current fiscal year were 306 million
yen (year-on-year decrease of 9.3%).

3

TOKYO ELECTRON(For reference)

Consolidated Operating Results（Millions of yen）
FY2018Net Sales
Semiconductor Production Equipment
Japan
North America
EuropeSouth Korea
TaiwanChina
Southeast Asia
FPD Production Equipment
Other
Operating Income
Ordinary Income
Net Income Attributable to Owners of Parent
Note:

1Q

2Q

3Q

Total

236,396
221,969
26,77624,09725,382
68,37545,89726,757
4,683
14,323104
54,79055,14941,252

280,580
265,773
38,46832,077
26,931
101,790
36,646
23,073
6,786
14,701
104
68,527
67,91749,415

257,773
241,41135,112
29,121
19,621
79,47942,15522,64813,271
16,26497
58,09257,36040,715

774,750
729,154
100,357
85,296
71,935
249,645
124,699
72,47924,74145,289306
181,411
180,426
131,384

Intersegment sales or transfers are eliminated.

(2) Description of Financial Conditions(i) Financial Conditions
Current assets at the end of the third quarter of the current fiscal year were 882,052 million yen, an increase of
106,113 million yen compared to the end of the previous fiscal year. This was mainly due to an increase of 96,607
million yen in inventories, an increase of 42,375 million yen in cash and deposit, an increase of 18,454 million yen in
trade notes and accounts receivable, and a decrease of 56,500 million yen in short-term investments included insecurities.
Tangible fixed assets increased by 20,425 million yen from the end of the previous fiscal year, to 120,866 million yen.
Intangible fixed assets increased by 1,137 million yen from the end of the previous fiscal year, to 16,538 million yen.
Investments and other assets increased by 6,381 million yen from the end of the previous fiscal year, to 72,047
million yen.
As a result, total assets increased by 134,058 million yen from the end of the previous fiscal year, to 1,091,505 million
yen.
Current liabilities increased by 67,317 million yen from the end of the previous fiscal year, to 315,087 million yen. This
was largely due to an increase of 44,307 million yen in customer advances and an increase of 16,347 million yen in
trade notes and accounts payable.
Long-term liabilities increased by 3,158 million yen from the end of the previous fiscal year, to 66,836 million yen.
Net assets increased by 63,582 million yen from the end of the previous fiscal year, to 709,582 million yen. This waslargely due to an increase of 131,384 million yen in net income attributable to owners of parent and a decrease
resulting from the payment of 82,203 million yen in year-end dividends for the previous fiscal year and interim
dividends for the current fiscal year. As a result, the equity ratio was 64.6%

4

TOKYO ELECTRON(ii) Cash Flows
Cash and cash equivalents at the end of the third quarter of the current fiscal year increased by 60,875 million yen
compared to the end of the previous fiscal year, to 225,241 million yen. The combined balance including 76,000
million yen in time deposits and short-term investments with maturities of at least three months that are not included
in cash and cash equivalents was 301,241 million yen, a decrease of 14,124 million yen from the end of the previous
fiscal year. The overall situation regarding cash flows during the first three quarters of the current fiscal year was as
described below.
Cash flows from operating activities were positive 98,409 million yen, an increase of 5,099 million yen compared tothe same period of the previous fiscal year. The major positive factors were 179,627 million yen in net income before
income taxes, a 42,925 million yen increase in customer advances, 14,531 million yen in depreciation andamortization, and a 13,505 million yen increase in trade notes and accounts payable. The major negative factors
were a 94,407 million yen increase in inventories, 49,347 million yen in income taxes paid, and a 16,642 million yen
increase in trade notes and accounts receivable.
Cash flows from investing activities were positive 40,986 million yen compared to the positive 43 million yen in thesame period of the previous fiscal year. These were largely due to an inflow of 75,000 million yen from a decrease intime deposits and short-term investments, and the payment of 31,126 million yen for the purchase of fixed assets.
Cash flows from financing activities were negative 82,544 million yen compared to the negative 39,378 million yen in
the same period of the previous fiscal year. This was largely due to the payment of 82,203 million yen in dividends.

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TOKYO ELECTRON

Consolidated Statements of Cash Flows (Summary)Nine months ended
December 31, 2016

（Millions of yen）
Nine months ended
December 31, 2017

Cash flows from operating activities
Income before income taxes
Depreciation and amortization
Decrease (increase) in trade notes and accounts receivable
Decrease (increase) in inventories
Increase (decrease) in trade notes and accounts payable
Other, net
Cash flows from investing activities
Decrease (increase) in time deposits and short-term investments
Other (Acquisition of fixed assets)
Cash flows from financing activities
Effect of exchange rate changes on cash and cash equivalents

93,31087,632
12,779(9,723)(35,458)
5,428
32,65043
14,032(13,989)(39,378)679

98,409179,627
14,531(16,642)(94,407)13,505
1,794
40,98675,000(34,013)(82,544)
4,023

Net increase (decrease) in cash and cash equivalents

54,65460,875

Cash and cash equivalents at beginning of period
Cash and cash equivalents at end of period

95,638150,293

164,366
225,241

Cash and cash equivalents, time deposits and short-term investments with maturities of atleast three months

277,293

301,241(3) Description of Financial Estimates Information such as Consolidated Financial Forecasts
There are no changes in the forecast of consolidated financial results for the entire fiscal year ending March 31, 2018from the forecasts released at the time of the previous announcement on October 31, 2017.

Note: The financial forecasts and estimates stated in this announcement are based on certain assumptions judged to be reasonable by the Company inlight of information currently available concerning economic conditions in Japan and overseas, fluctuations in foreign exchange rates, and other factorsthat may have an impact on performance. The company does not promise that the forecasts or estimates will be accurate.
They are therefore susceptible to the impact of many uncertainties, including market conditions, competition, the launching of new products (and theirsuccess or failure), and global conditions in the semiconductor related industry. Consequently, actual sales and profits may differ substantially from the
projections stated in this announcement.

6

TOKYO ELECTRON

Consolidated Balance Sheets(Millions of yen)
As of

As of

March 31, 2017

December 31, 2017

ASSETS
Current assets
Cash and deposit

70,866113,241

Trade notes and accounts receivable

133,858

152,312Securities

244,500

188,000

Merchandise and finished goods

152,629

220,434

Work in process

51,112

71,887

Raw materials and supplies

32,51440,542Others90,52095,714(63)(81)

775,938

882,052

100,441

120,866

Others15,401

16,538

Total intangible fixed assets

15,401

16,538Others

67,48273,498

Allowance for doubtful accounts(1,816)(1,450)Allowance for doubtful accounts
Total current assets
Long-term assets
Tangible fixed assets
Intangible fixed assets

Investments and other assets

Total investments and other assets
Total long-term assets
Total assets

765,666

72,047

181,508

209,453

957,447

1,091,505

TOKYO ELECTRON

Consolidated Balance Sheets(Millions of yen)
As of

As of

March 31, 2017

December 31, 2017

LIABILITIESCurrent liabilities
Trade notes and accounts payable

79,217

95,564

Income taxes payable

31,06931,663

Accrued employees’ bonuses

21,85318,754

Other allowances

10,47013,927

Customer advances

67,976112,283

Others37,18342,894

Total current liabilities

247,770

315,087

Long-term liabilities
Other allowances

374

374

Net liability for defined benefits

55,82556,882Others

7,476

9,578

Total long-term liabilities

63,677

66,836

311,447

381,923

Common stock

54,961

54,961

Capital surplus

78,02378,011Retained earnings

Total liabilities
NET ASSETS
Shareholders' equity

503,325

552,431

Treasury stock, at cost

(7,766)(7,575)

Total shareholders' equity

628,543

677,827

10,78817,752

59

(139)

5,789

12,517

Accumulated other comprehensive income
Net unrealized gains (losses) on investment securities
Net deferred gains (losses) on hedging instruments
Foreign currency translation adjustments
Accumulated remeasurements of defined benefit plans(2,086)(2,772)

Total accumulated other comprehensive income (loss)

14,551

27,357

2,620

4,396

Share subscription rights
Non-controlling interests
Total net assets
Total liabilities and net assets

8

284

-

645,999

709,582

957,447

1,091,505

TOKYO ELECTRON

Consolidated Statements of Income(Millions of yen)
Nine months ended

Nine months ended

December 31, 2016

December 31, 2017

Net sales

539,087774,750

Cost of sales

327,468

453,261

Gross profit

211,619

321,488

Research and development expenses

58,97770,018Others58,48170,058

Total selling, general and administrative expenses

117,458

140,077

94,160181,411125

456

Selling, general & administrative expenses

Operating income
Non-operating income
Share of profit of associates accounted for using the equity method
Others

1,957

1,780

Total non-operating income

2,083

2,237

Foreign exchange loss

351

2,986

Others200

235

Total non-operating expenses

551

3,222

95,692

180,42650

72

Non-operating expenses

Ordinary income
Unusual or infrequent profit
Gain on sales of fixed assets
Others6-

Total unusual or infrequent profit

57

72

160

335

Unusual or infrequent loss
Loss on disposal and sales of fixed assets
Loss on disaster

7,828

-

Loss on valuation of investment securities

53

536

Others

74

-

8,116

871

Income before income taxes

Total unusual or infrequent loss

87,632

179,627

Income taxes

19,67848,214

Net income

67,953

131,41235

28

67,918131,384

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

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TOKYO ELECTRON

Consolidated Statements of Comprehensive Income(Millions of yen)

Net income

Nine months ended

Nine months ended

December 31, 2016

December 31, 2017

67,953

131,412

643

6,960

Other comprehensive income (loss)
Net unrealized gains (losses) on investment securities
Net deferred gains (losses) on hedging instruments

(57)

(177)

Foreign currency translation adjustments

(128)

6,717

Remeasurements of defined benefit plans

189

(693)

Share of other comprehensive income of associates
accounted for using the equity method

(36)

0

Total other comprehensive income (loss)

609

12,807

68,563

144,220

68,516

144,191

47

29

Comprehensive income(Breakdown)Comprehensive income attributable to owners of parent
Comprehensive income attributable to non-controlling interests

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TOKYO ELECTRON

Notes
Going concern: None
Significant changes in Shareholders' Equity: None
Changes in significant subsidiaries during the period: Yes
The absorption-type merger of Tokyo Electron Yamanashi Ltd. and Tokyo Electron Tohoku Ltd. was performed, effective July 1, 2017 with
Tokyo Electron Yamanashi Ltd. as the surviving company and Tokyo Electron Tohoku Ltd. as the absorbed company, and the name of thesurviving company following the merger was changed to Tokyo Electron Technology Solutions Ltd.
Adoption of special accounting methods for preparation of quarterly financial statements: Yes
The company and a part of its consolidated subsidiaries calculate tax expenses by reasonably estimating the annual effective tax rate on
income before income taxes after the application of tax effect accounting for the fiscal year, and applying this rate to income before income
taxes for the current quarter under review.
Changes in accounting policies, changes in accounting estimates and restatements: None

11

TOKYO ELECTRON

Segment information(i) General information about reportable segments
A reportable segment is a component or an aggregated component of TEL Group. For each of the components, discrete financial
information is available and the operating result is regularly reviewed by management to make decisions about resources to beallocated to the segment and assess its performance.
The operation of TEL Group consists of segments by products and services based on business units (BUs), and TEL Groupidentifies as a reportable segment, "semiconductor production equipment (SPE)" and "flat panel display (FPD) production equipment".
Products of the SPE segment consist of coater/developers, etch systems, thermal processing systems, single wafer deposition systems,
cleaning systems, wafer probers used in the wafer testing process and other semiconductor production equipment. The SPE segmentprincipally develops, manufactures, sells such products and provide services on them.
Products of the FPD production equipment segment consist of coater/developers, etch/ash systems used in the manufacture offlat panel displays. The FPD production equipment segment principally develops, manufactures, sells such products and provide serviceson them.
(ii) Net sales and profit or loss in reportable segments
Nine months ended December 31, 2017 (April 1, 2017 to December 31, 2017)(Millions of yen)

Reportable Segments
Semiconductor
Production
Equipment

FPD Production
Equipment

Others *1

Total

Net sales

729,154

45,28914,036788,480

Segment profit (loss)

213,863

5,812

(53)

219,622

Eliminations andCorporate *2

Consolidated *3

Net sales(13,730)

774,750

Segment profit (loss)(39,995)

179,627

Notes:*1. "Others" includes all other operating segments which are not included in the reportable segments, including group-wide logistic
services, facility maintenance and insurance.
*2. "Eliminations and Corporate" segment loss totaling 39,995 million yen includes corporate expenses not allocated to any
reportable segments. The corporate expenses consist of research and development costs of 16,303 million yen, pertaining to
the fundamental research and element research of TEL.
*3. Segment profit or loss is adjusted against income before income taxes in Consolidated Statements of Income.

(iii) Impairment losses on fixed assets and goodwill, etc. in reportable segments
Significant impairment losses related to fixed assets: None
Significant changes in goodwill amount: None
Significant gains on negative goodwill: None12