TOKYO ELECTRON

February 3, 2012

Consolidated Financial Review
for the Third Quarter Ended December 31, 2011
Company name:
URL:
Telephone number:
Stock exchange listing:Tokyo Electron Limited

http://www.tel.com(03) 5561-7000
Tokyo Stock Exchange 1st Section (Code 8035)

Notes: 1. The accompanying financial statements have been prepared in accordance with accounting
principles and practices generally accepted in Japan.
2. Amounts are rounded down to the nearest million yen.

1. Financial highlights for the nine months ended December 31, 2011
Nine months ended
December 31, 2010 December 31, 2011
Net sales (Millions of yen)
478,063455,514
Operating income (Millions of yen)
68,15742,953
Ordinary income (Millions of yen)
71,77446,720Net income (Millions of yen)
52,121
27,412
Net income per share (Yen)
291.13153.06
Fully diluted net income per share (Yen)
290.69152.82Comprehensive income:Year ended 12/31/11: 21,559 million yen
Year ended 12/31/10: 47,812 million yen(1) Operating results (Cumulative)(2) Financial position

Total assets (Millions of yen)
Net assets (Millions of yen)
Equity ratio (%)
Equity: 571,334 million yen (as of December 31, 2011)
572,741 million yen (as of March 31, 2011)

As ofMarch 31, 2011
809,205
584,801
70.8

As of
December 31, 2011769,213583,143
74.3

2. Dividends
Year ended
March 31, 2011
38.00
76.00
114.002Q-end dividend per share (Yen)
Year-end dividend per share (Yen)Annual dividend per share (Yen)
Note: Revision of dividends forecast : None

Year ending
March 31, 2012
53.00
27.00 (Forecast)
80.00 (Forecast)

3. Earnings forecasts for the year ending March 31, 2012
Year ending
March 31, 2012
Net sales (Millions of yen)
Operating income (Millions of yen)
Ordinary income (Millions of yen)
Net income (Millions of yen)
Net income per share (Yen)
Note: Revision of earnings forecast : None

630,000
57,00060,50040,000223.301

TOKYO ELECTRON
4. Others(1) Important changes in subsidiaries during the current period: None
(2) Adoption of special accounting method in preparing quarterly financial statement: Yes(3) Changes in accounting policies, accounting estimation, and restatement
1. Changes in accounting policies along with changes in accounting standards: Yes
2. Other changes of accounting policies besides number 1 above: None
3. Changes in accounting estimation: None
4. Restatement: None
(4) Number of shares issued and outstanding (common stock)
1. Number of shares issued and outstanding (including treasury stock)
As of December 31, 2011:

180,610,911 shares

As of March 31, 2011:

180,610,911 shares

2. Number of shares of treasury stock
As of December 31, 2011:

1,479,509 shares

As of March 31, 2011:

1,554,231 shares

3. Average number of shares outstanding
Nine months ended December 31, 2011: 179,100,704 shares
Nine months ended December 31, 2010: 179,029,939 shares

Notification of the status of quarterly financial review procedures:This quarterly financial report is outside the jurisdiction of auditing procedures outlined in the Financial Instruments and Exchange Act
and remain incomplete at the time of announcing this report.
Explanations on the appropriate use of earnings forecast:
The performance forecast and estimate stated in this Financial Review are based on certain assumptions judged to be reasonable
at the present time in light of information currently available. Consequently, actual operating results may differ substantially.

2

1. Qualitative Information on Financial Results for the Third Quarter(1) Qualitative Information on Consolidated Operating Results

During the first three quarters of the current fiscal year (the nine-month period from April to December 2011),
the uncertain situation about the future of the global economy continued with emerging economies, such as
China, experiencing a deceleration of growth coming on top of concerns about a slowdown in the US
economy, and financial instability in Europe. In Japan, even though the Japanese economy is on thegradual road to recovery from the impact of the Great East Japan Earthquake, a mood of caution about the
future is spreading there as well, given the global economic slowdown and the historically high level of theyen.
In the electronics industry, the field of business in which the Tokyo Electron Group is engaged, mobile
terminal devices, such as smartphones, performed strongly, but sales of personal computers and digitalappliances remained sluggish, resulting from factors such as the global economic slowdown and delays inparts supplies due to the floods in Thailand.

Under these circumstances, consolidated net sales for the first three quarters of the current fiscal year were455,514 million yen (down 4.7% compared to the same period of the previous year). Consolidated
operating income and ordinary income were 42,953 million yen (down 37.0% compared to the same periodof the previous year) and 46,720 million yen (down 34.9% compared to the same period of the previousyear), respectively. Net income for the first three quarters of the current fiscal year was 27,412 million yen(down 47.4% compared to the same period of the previous year).

An overview of each business segment is as described below.

(i) Semiconductor Production Equipment
Significant falls in DRAM prices meant that production adjustment continued, and excess supply even of
flash memory, for which there is tremendous demand, meant that investment in increasing production did
not materialize. However, in terms of recently received orders for production equipment, investment inminiaturization related to flash memory and logic semiconductors for mobile terminal devices is beginning toshow signs of recovery. Under these circumstances, net sales from external customers in this segment
during the first three quarters of the current fiscal year were 339,990 million yen (down 4.4% compared tothe same period of the previous year).

3

(ii) FPD/PV (Flat Panel Display/Photovoltaic Cell) Production Equipment
Investment in large-sized LCD panels continued to be weak due to sluggish global demand and significant
price falls for televisions. While, in contrast, demand for small and mid-sized LCD panels for use in mobile
terminal devices was healthy, demand for production equipment did not grow, because panel
manufacturers’ supply capacity has also increased. Under these circumstances, net sales from externalcustomers in this segment during the first three quarters of the current fiscal year were 53,311 million yen(down 2.8% compared to the same period of the previous year).

(iii) Electronic Components and Computer Networks
Sales of electronic components continued to be weak amidst a backdrop of sluggish demand for digitalappliances and companies taking a cautious approach to capital investment. In the computer networks
business, sales were strong as companies invested in IT, investments that included preparations to move tocloud computing and disaster contingency planning. Under these circumstances, net sales from externalcustomers in this segment during the first three quarters of the current fiscal year were 61,902 million yen(down 8.0% compared to the same period of the previous year).

(iv) Others
Net sales from external customers in this segment during the first three quarters of the current fiscal year
were 309 million yen (up 0.6% compared to the same period of the previous year).

(For reference）

Consolidated Operating Results（Millions of yen）
FY2012Net Sales
Semiconductor Production Equipment
Japan
U.S.
EuropeKorea
TaiwanChina
S.E.Asia and others
FPD/PV Production Equipment
Electronic Components & Computer Networks
OthersOperating Income
Ordinary Income
Net Income

1Q

2Q

3Q

Total

153,117
120,836
20,94329,75613,99916,926
24,7059,115
5,390
12,536
19,64896
23,08823,751
16,636173,232
127,557
29,421
23,823
16,988
20,957
19,458
6,685
10,222
24,141
21,388145
13,77015,97010,021

129,164
91,596
16,641
28,641
9,545
20,647
9,687
3,931
2,501
16,633
20,865
68
6,094
6,998
755

455,514339,990
67,00682,22040,53358,53053,851
19,732
18,11553,311
61,902309
42,953
46,72027,412

Note: Offset elimination has been carried out on the dealing between segments.

4

Production and Order Performance（ Millions of yen）

1. Production

FY2012

Semiconductor Production Equipment
FPD/PV Production Equipment
Total
Note:

1Q

2Q

3Q

Total

127,147
14,115
141,262

105,286
15,841
121,127

97,09816,035
113,134

329,532
45,992375,524

1. Amounts are based on sales prices.
2. The above amounts do not include consumption taxes.

（ Millions of yen）

2. Orders Received

FY2012

Semiconductor Production Equipment
FPD/PV Production Equipment
Electronic Components & Computer Networks
Others
Total
Note:

1Q

2Q

3Q

Total

112,6928,920
22,50896
144,21773,531
1,713
19,584
145
94,974

144,971
5,078
20,441
68
170,560

331,195
15,71262,534309
409,752

1. Offset elimination has been carried out on the dealing between segments.
2. The above amounts do not include consumption taxes.

（ Millions of yen）

3. Orders Backlog

FY2012

Semiconductor Production Equipment
FPD/PV Production Equipment
Electronic Components & Computer Networks
Others
Total
Note:

1Q

2Q

3Q

220,798
61,875
17,235299,909

166,773
39,447
15,430221,651

220,148
27,892
15,006
263,048

1. Offset elimination has been carried out on the dealing between segments.
2. The above amounts do not include consumption taxes.

(2) Qualitative Information on Consolidated Financial Conditions(i) Financial Conditions
Current assets at the end of the third quarter of the current fiscal year were 596,726 million yen, down
47,505 million yen compared to the end of the previous fiscal year. The major factors influencing this result

5were a 42,062 million yen decrease in short-term investments included in securities, an 8,236 million yen
decrease in trade notes and accounts receivable, and a 6,426 million yen increase in cash and deposits.
Tangible fixed assets were 124,554 million yen, an increase of 12,002 million yen from the end of theprevious fiscal year.
Intangible fixed assets were 4,593 million yen, an increase of 381 million yen from the end of the previous
fiscal year.
Investments and other assets were 43,338 million yen, a decrease of 4,870 million yen compared to the endof the previous fiscal year.
As a result, total assets were 769,213 million yen, a decrease of 39,991 million yen compared to the end of
the previous fiscal year.
Current liabilities were 127,404 million yen, down 40,633 million yen compared to the end of the previous
fiscal year. Major factors in the decrease were a decline in income taxes payable of 22,667 million yen, anda decrease in trade notes and accounts payable of 9,959 million yen.
Long-term liabilities were 58,664 million yen, up 2,299 million yen compared to the end of the previous fiscal
year.
Net assets were 583,143 million yen, as a result of a net income of 27,412 million yen reported for the third
quarter of the current fiscal year combined with a decrease due to year-end dividends for the previous fiscal
year of 13,608 million yen and interim dividends for the current fiscal year of 9,493 million yen. The equity
ratio was 74.3%.

(ii) Cash Flow
Cash and cash equivalents at the end of the third quarter of the current fiscal year were 141,423 million yen,a decrease of 23,626 million yen compared to the end of the previous fiscal year. The combined balance of
cash and cash equivalents, plus 107,991 million yen in time deposits with deposit terms of over threemonths (which are not included in cash and cash equivalents) and short-term investments, decreased by
35,635 million yen from the end of the previous fiscal year, to 249,414 million yen. The overall situation
regarding cash flow during the first three quarters of the current fiscal year is as described below.
Cash flow from operating activities were positive 21,744 million yen, an increase of 1,972 million yen
compared to the same period of the previous year. Major positive factors included 45,979 million yen inincome before income taxes, 17,014 million yen in depreciation and amortization, a 6,348 million yen
decrease in prepaid consumption tax, and a 5,649 million yen decrease in trade notes and accounts
receivable. The major negative factors included the payment of income taxes of 46,134 million yen and adecrease in trade notes and accounts payable of 8,457 million yen.
Cash flow from investing activities was negative 19,176 million yen compared to the negative 26,918 million
yen in the same period of the previous year, primarily due to a 12,000 million yen decrease in time deposits
and short-term investments, as well as 28,133 million yen spent on the acquisition of tangible fixed assets.

6

Cash flow from financing activities was negative 24,464 million yen, primarily as a result of the payment of
23,101 million yen in dividends. Cash flow from financing activities in the previous fiscal year was negative
2,194 million yen.

Consolidated Cash Flow (Summary)

Cash flow from operating activities
Income before income taxes
Depreciation and amortization
Decrease in trade notes and accounts receivable (increase)
Decrease in inventories (increase)
Increase in accounts payable (decrease)
OthersCash flow from investing activities
Decrease in time deposits (increase)
Others (purchase of fixed assets)
Cash flow from financing activities
Effect of exchange rate changes on cash and cash equivalents

Nine months ended
December 31, 2010

（Millions of yen）
Nine months ended
December 31, 2011

19,772
71,672
12,442(18,267)(47,327)
1,533
(281)
(26,918)80(26,999)(2,194)(1,352)

21,74445,97917,014
5,649
1,539(8,457)(39,981)(19,176)
12,000(31,176)(24,464)(1,730)Net increase in cash and cash equivalents (decrease)(10,693)(23,626)

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

123,939
113,246

165,050
141,423

Cash and cash equivalents and time deposits with deposit terms of overthree months (which are not included in cash and cash equivalents) andshort-term investments at end of period

233,246

294,414

3. Qualitative Information on Forecasts for Consolidated Financial Results

There are no changes in the forecast of consolidated financial results for the entire fiscal year from the
projections released at the time of the previous announcement on October 28, 2011.

Note: The financial forecasts and estimates stated in this financial review are based on certain assumptions judged to bereasonable at the present time in light of information currently available concerning economic conditions in Japan and overseas,fluctuations in foreign exchange rates, and other factors that may have an impact on performance.
They are therefore susceptible to the impact of many uncertainties, including market conditions, competition, the launching of
new products (and their success or failure), and global conditions in the semiconductor production equipment business.
Consequently, actual sales and profits may differ substantially from the projections stated in this financial review.

7

TOKYO ELECTRON

Consolidated Balance Sheet(Millions of yen)
As ofMarch 31, 2011

As of
December 31, 2011ASSETS
Current assets
Cash and deposit

52,99259,419Trade notes and accounts receivable

136,385

128,149

Securities

232,057

189,995

Merchandise and finished goods

111,918

112,443

Work in process

43,24638,278Raw materials and supplies

13,76012,866

Others55,02456,752

Allowance for doubtful accounts(1,153)(1,178)644,231596,726

112,551

124,554

Total current assets
Long-term assets
Tangible fixed assets
Intangible fixed assets
Others

4,212

4,593

Total intangible fixed assets

4,212

4,593

Others50,24045,306

Allowance for doubtful accounts(2,031)(1,968)Investments and other assets

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

8

48,20943,338

164,973

172,486

809,205

769,213

TOKYO ELECTRON(Millions of yen)
As ofMarch 31, 2011

As of
December 31, 2011

LIABILITIESCurrent liabilities
Trade notes and accounts payable

53,61243,653

Accrued warranty expenses

7,594

7,994

Other allowance

11,806

5,129

Others95,02470,627

Total current liabilities

168,038

127,404

52,23053,969595

615

Long-term liabilities
Accrued pension and severance costs
Other allowance
Others

3,538

4,080

Total long-term liabilities

56,36558,664

224,403

186,069

54,961

54,961

Total liabilities
NET ASSETS
Shareholders' equity
Common stock
Capital surplus

78,04578,023Retained earnings

457,658

461,901

Treasury stock(10,484)(9,975)

Total shareholders' equity

580,180

584,910

2,807

1,557

(12)

(11)

Accumulated other comprehensive income
Valuation difference on available-for-sale securities
Deferred gains or losses on hedges
Translation adjustments(10,234)(15,122)

Total accumulated other comprehensive income(7,439)(13,576)

Share subscription rights

1,499

1,291

Minority interests

10,56010,518

Total net assets

584,801

583,143

809,205

769,213

Total liabilities and net assets

9

TOKYO ELECTRON

Consolidated Statement of Income(Millions of yen)
Nine months ended
December 31, 2010

Nine months ended
December 31, 2011

Net sales

478,063455,514

Cost of sales

310,611

300,532

Gross profit

167,452

154,981

Research and development expenses

51,01459,872Others48,28052,155

Total selling, general & administrative expenses

99,294

112,027

68,15742,953Foreign currency translation gain

132

1,089

Revenue from development grants

2,609

829

Others

1,396

2,132

Total non-operating income

4,138

4,052

Selling, general & administrative expenses

Operating income
Non-operating income

Non-operating expenses
Maintenance and operation cost of closed business bases

150

89

Others370

196

Total non-operating expenses

521

285

71,77446,720Ordinary income
Unusual or infrequent profit
Gain on collection written-off claims

-

1,437

Others523

184

Total unusual or infrequent profit

523

1,622

-

938

-

779

625

645

Unusual or infrequent loss
Loss from earthquake damage
Loss on revaluation of investment securities
Others625

2,363

Income before income taxes

Total unusual or infrequent loss

71,67245,979Provision for income taxes and enterprise taxes

18,927

18,252

Income before minority interests

52,74427,726623

313

52,121

27,412

Minority interests
Net income*Due to altering tax rates, there were a 3,215 million yen increase on provision for income taxes andenterprise taxes for the first three quarters of the current fiscal year.

10

TOKYO ELECTRON

Consolidated Statement of Comprehensive Income(Millions of yen)
Nine months ended
December 31, 2010

Nine months ended
December 31, 2011

52,74427,726

Valuation difference on available-for-sale securities

33(1,249)Deferred gains or losses on hedges

161

6Translation adjustments(5,127)(4,923)

Total other comprehensive income (loss)(4,932)(6,167)

47,812

21,55947,18821,275624

283

Income before minority interests
Other comprehensive income (loss)

Comprehensive income(Breakdown)Comprehensive income attributable to owners
Comprehensive income attributable to minority interests11Segment Information

TOKYO ELECTRON(i) Overview of reportable segments
The reportable segments by the company provide separate financial information pertaining to thevarious segments of the company, which is reviewed periodically by the management to evaluate
corporate performance as well as make decisions about the allocation of management resources.
The corporate structure consists of product and service segments based on business units (BUs), andthe reportable segments are as follows: Semiconductor Production Equipment, FPD/PV (Flat Panel
Display and Photovoltaic Cell) Production Equipment, and Electronic Components and Computer
Networks.
The Semiconductor Production Equipment segment consists of coaters/developers, plasma etchsystems, thermal processing systems, single wafer deposition systems, cleaning systems used inwafer processing, wafer probers used in the wafer testing process and other semiconductor
production equipment, and we are engaged in the development, manufacturing, sales and provision ofmaintenance services, etc. for such products.
The FPD/PV (Flat Panel Display and Photovoltaic Cell) Production Equipment segment consists ofcoaters/developers, plasma etch/ash system used in the manufacturing of flat panel displays, andplasma CVD systems used in the manufacturing of thin film silicon PV cells, and we are engaged in
the development, manufacturing, sales and provision of maintenance services, etc. for such products.
The Electronic Components and Computer Networks segment consists of semiconductor products
centering on integrated circuits (IC), other electronic components, computer networks and software,etc., and we are engaged in the design, development, procurement, and sales, etc. for such products.
(ii) Net sales and profit/loss in reportable segments
Nine months ended December 31, 2011

( Millions of yen)

Reportable Segment
Semiconductor
Production
Equipment

FPD/PV
Production
Equipment

Electronic
Components &Computer
Networks

Net sales

339,990

53,31162,888

11,289Segment income

63,885

3,555

1,640

1,365

Total Segments

Eliminations*2

Consolidated
Total*3

Net sales

467,478(11,964)455,514Segment income

70,446(24,467)

45,979Others*1

Notes:
1. The "Others" segment includes all other businesses which are not included in the reported
business segments, such as the transportation of products, etc. of the Tokyo Electron Group
companies, equipment leasing and insurance, etc.
2. The eliminations of segment income amounting to 24,467 million yen includes corporate
expenses pertaining to the corporate account which are not allocated to any specific reportablesegments. The corporate account expenses are mainly R&D expenses of 18,834 million yen,pertaining to fundamental research and element research conducted by the company not related
to any of the reportable segments.
3. Segment income is adjusted against income before income taxes in the consolidated statementof 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 income related to negative goodwill: None12