INTERIM BUSINESS REPORT 2009
December 1, 2008 to May 31, 2009

NACHI-FUJIKOSHI CORP.
Securities Code: 6474

TO OUR SHAREHOLDERS
We are delighted to report to you about
NACHI-FUJIKOSHIʼs interim businessperformance for the interim period from
December 1, 2008 to May 31, 2009.
Business Environment
The operating environment for the
NACHI-FUJIKOSHI Group during the interim
period has been exceedingly dire, as
indicated by aspects like the abrupt andextensive shrinking of the market for arange of industries at home and abroad like
automobiles, industrial machinery, andelectrical appliances and electronics.
Business Progress and Results
In this environment, the NACHI-FUJIKOSHI
Group has worked to establish a new revenue
base predicated upon our unique engineeringbusiness. Nevertheless, the fall-oﬀ in demandhas continued unabated, and net sales during
the interim period decreased 47.2% from theprevious ﬁscal year to ¥55.4 billion. Sales to
the Japanese market amounted to ¥36.6 billion(down 49.2% from the same period last year)
and sales overseas amounted to ¥18.8 billion(down 42.5% from the same period last year).

The colorful triangle on the lower
right of the front cover symbolizes
the notion of “Sei-Han-Go,”or“Fusing
discrete and opposing ideas intoone,” the Group corporate philosophy implicit in the meaning of “Fuji”
in our name.

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Turning to earnings, the NACHI-FUJIKOSHI
Group is working to reduce various expenses
such as materials and contracting expenses
and personnel expenses in response to thesharp decline in sales and production.
However the decline in capacity utilization
has had a substantial impact: during theinterim period, operating losses amountedto ¥1.7 billion (a decline of ¥11.3 billion fromthe same period last year) and ordinary
losses amounted to ¥2.9 billion (a decline of¥11.5 billion from the same period last year).
Along with extraordinary losses of ¥300
million and corporate income taxes of ¥1.5billion, this resulted in net interim losses of¥4.7 billion (a decline of ¥9.6 billion from thesame period last year).

The NACHI-FUJIKOSHI Group promotes“NACHI Business”, which creates synergy
eﬀects among our multiple business ﬁelds
including machining, robots, components andmaterials and heat treatment technologies.
Currently, we focus on developing energy
and infrastructure markets and identifying
newly emerging markets, which are expected
to grow steadily for long term. In addition, by
making numerous improvements in all
aspects of business operations such as
procurement and logistics, R&D, andpersonnel and organizational management
as well as a thorough cost reduction inmanufacturing, we strive to establish astable revenue base and improve ourperformance.

Future Action
Looking ahead, inventory is being adjusted
in some industries, such as the automotive
industry, and signs of restored productionare also apparent, but production trends
throughout industrial machinery sectors
remain at low levels not seen previously.
On the whole, conditions will remain
unfavorable.

We thank all of our shareholders for yourcontinued support and understanding.
August 2009

Kensuke Imura Chairman and CEO, Representative Director (Left)
Hiroo Honma President and COO, Representative Director (Right)

RESULTS OF OPERATIONS (Interim Period)
Sales by Business Segments
Special Steels/
Industrial Furnaces
and Others

9％

HydraulicEquipment

Sales by MarketEnergy/
Infrastructure

Cutting Tools

16％

16％

15％Machine Tools/
Precision Machinery¥55.4
billion¥55.4
billion15％

Net Sales (¥ billions)■ Interim ■ Full-year

54％

America34％¥18.8
billionEurope12％

Operating Income (¥ billions)■ Interim ■ Full-year

204.8

193.6

186.7

46％

38％

7％

38％

Asia, Oceania,
andthe Middle East

Automotive

Machinery/
RetailRobotsBearings

Overseas Sales

16.7
15.5

15.5

104.8
93.1

9.5

92.6
7.5

7.9

55.4

（1.7）

2006

2007

2008

2009

2006

2007

2008

2009

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TOPICS
The NACHI-FUJIKOSHI Group is working to develop energy and infrastructure market andidentify newly emerging markets, which should lead to long-term growth. The Group is also
working to evolve its engineering business and expand its operations in the global market.

Developing Energy and Infrastructure Markets
Bearings for bullet trains

Seeking to provide lighterweight, smaller, and more
durable bearings to allowbullet trains to run faster

Large module hobs

Highly eﬃcient machining of large
gears for wind power generators

Spherical roller bearings

Christmas-tree-type broaches

Providing dependability with theworldʼs highest load capacity andservice life

An essential precision cutting tool for high-precisionand highly eﬃcient machining of turbines for generators
and aircraft engines

Expanding Operations in Newly Emerging Markets
We are turning our attention to newly emerging markets,
which should lead to growth, in places like China, ASEAN
countries, India, the Middle East, and Latin America.
We have established a new business oﬃce in Turkey.
(July 2009)
SHANGHAI NACHI BEARINGS CO., LTD.
NACHI (SHANGHAI) PRECISION TOOLS CO., LTD.
(China)NACHI MEXICANAENGINEERING CENTER(Mexico)NACHI TECHNOLOGY(THAILAND) CO., LTD.
(Southeast Asia, Thailand)
ASEAN Business Center

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NACHI BRASIL LTDA.
(South America, Brazil)

Overseas Offices

Evolving the Engineering Business
Established NACHI Tool Engineering Co., Ltd.

We established NACHI Tool Engineering Co., Ltd. aspart of our engineering business and we haveenhanced our operations related to regrinding andrecoating of cutting tools.
NACHI Tool Engineering is positioned as a global
production center to handle increased demand
from overseas markets in places like China, India,
and ASEAN countries.
(May 2009)＜Engineering Business＞

Regrinding and Recoating of cutting tools/
Tool engineering serviceMaintenance, Overhaul of robots
and machine tools

Energy-efficient hydraulic unit/
Recycling system for working fluid and debris

Heat treatment andCoating services

NACHI Tool Engineering Co., Ltd.
GPA Engineering Co., Ltd.

NACHI Robot Engineering Co., Ltd.
NACHI Machinery Engineering Co., Ltd.

Toyama Technical Center (Inside the Toyama Plant)

Eastern Japan Service Center (Kanagawa)

NACHI Industrial Service Co., Ltd.

NACHI Thermotech Co., Ltd.

Revamping the Logistics Network

Centralized management ofcutting tools and parts inventories

Established “NACHI Logistics Center ”

We established NACHI Logistics Center at our Higashi-Toyama Plant andconsolidated our nationwide logistics operations there.
We have made logistics more eﬃcient and enhanced customer service throughimprovements like the use of palletizing robots in product receipt and shipping work.
(June 2009)

Palletizing robots in the automated packaging line

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FINANCIAL STATEMENTS
Consolidated Balance Sheets
Item(¥ millions)Interim 2009(as of May 31,2009)

Interim 2008(as of May 31,2008)

79,662

100,490ASSETS:

Item

Interim 2009(as of May 31,2009)

Interim 2008(as of May 31,2008)

LIABILITIES:Current assets
Cash and cash equivalents22,567

19,659Notes and accounts receivable

22,882

43,950Inventories

30,03730,816

68,124

105,681

Notes and accounts payable

18,17543,782

Short-term bank loans

41,47333,395

Other

8,474

28,503Current liabilities

56,002

39,27843,46529,066

Allowance for retirement beneﬁts

5,091

6,699

Other

7,445

3,511

124,126

144,959

Long-term liabilities
Bonds and long-term debt

Other

4,175

6,063

Fixed assets

99,574

106,357

Property, plant and equipment

84,622

87,116

Total liabilities

Buildings and structures

31,91932,232NET ASSETS:

Machinery and equipment

38,66744,572

Land

7,334

7,571

Other
Intangible fixed assets

6,701

2,739

423

411

Investments and advances

14,52918,830Total assets

179,237

206,848

Consolidated Statements of Income
Item

Net salesInterim 2009
(December 1, 2008
‒May 31, 2009)

55,422

Shareholders’ equity

55,64959,078

Common stock

16,074

16,074Retained earnings

28,18431,604

Additional paid-in capital
Treasury stock

11,562(172)

11,572(172)

Revaluations and translation adjustments(3,019)227

Minority interests

2,480

2,582

Total net assets

55,11061,889Total liabilities and net assets

179,237

206,848(¥ millions)

Consolidated Statements of Cash Flows(¥ millions)Interim 2008
(December 1, 2007
‒May 31, 2008)

Item

Interim 2009
(December 1, 2008
‒May 31, 2009)

Interim 2008
(December 1, 2007
‒May 31, 2008)

104,874

Cash flows from operating activities(9,319)8,588(4,991)(8,844)

Operating income(1,789)9,553

Cash flows from investing activities

Ordinary income(2,924)

8,619

Cash flows from financing activities

24,397(924)

Net increase (decrease) in cash
and cash equivalents

9,601(1,590)

Cash and cash equivalents
at beginning of the period

12,833

20,965

Cash and cash equivalents
at end of the period

22,435

19,375Extraordinary income

137Extraordinary losses

372

146

(3,283)(4,760)

8,481
4,843

Income before income taxes
and minority interests
Net income

5SHAREHOLDER INFORMATION (As of May 31, 2009)
249,193,436
35,409Number of Shares Issued:
Number of Shareholders:Major Shareholders:Shareholders

NACHI WANEI Stockholding
Toyota Motor CorporationEmployeesʼ Stock Ownership Plan
The Bank of Tokyo-Mitsubishi UFJ, Ltd.
Japan Trustee Services Bank, Ltd.（4G）

Number of shares Shareholding ratio
held (thousand)(%)

13,89013,182
12,353
11,888
9,563

5.57
5.29
4.96
4.77
3.84

DIRECTORS AND AUDITORS(As of August, 2009)
Chairman and CEO,
Representative Director

Kensuke Imura

Breakdown of Shareholders
ForeignInvestors
9,553,000
shares
(3.8%)
FinancialInstitutions
82,807,000shares(33.2%)

Individuals
80,023,000
shares(32.2%)

Stock Ownership
Associations
30,967,000
shares(12.4%)

OtherJapaneseCorporations
43,538,000
shares(17.5%)

Securities Companies
2,302,000 shares (0.9%)

CORPORATE OFFICERS(As of August, 2009)Managing Director

Director

Corporate Oﬃcer

Corporate Oﬃcer

Managing Director

Standing Corporate Auditor

Corporate Oﬃcer

Corporate Oﬃcer

Kiyoshi Nakagawa

Keiichi Ogino

Sachio Tanaka

President and COO,
Representative Director

Noriyasu Shiba
DirectorStanding Corporate Auditor

Corporate Oﬃcer

Corporate Oﬃcer

Executive Vice President

Director

Corporate Auditor

Corporate Oﬃcer

Corporate Oﬃcer

Director

Corporate Auditor

Director*Outside director or outside
corporate auditor

Hiroo Honma

Atsushi Seki*

Kenji Ishiguro

Zenshiro Kaneko

Yukihiko Tanaka

Naoshi Katayama

Makoto Sasaki

Hideo Terakoshi

Managing Director
Managing Director

Naoto Nakano

Kiyoshi Meguro

Atsushi Saguchi*

Teruo Akashi

Masayuki Kobayashi

Nishiki Seto

Nobuo Segawa

Toshio Sugiura
Tadashi Yamazaki
Shigeki Miwa

Eiichi Fukushima*

CORPORATE INFORMATION (As of May 31, 2009)
Foundation:
Capital:Number of Employees:
Major Products:
Machining
RobotsComponents
Materials & Heat Treatment
Major Domestic Offices and Plants:
Toyama Head Oﬃce
Tokyo Head Oﬃce
Eastern Japan Main BranchCentral Japan Main BranchWestern Japan Main Branch
Toyama Plant

Higashi-Toyama Plant
Namerikawa Plant

December 21, 1928
¥16 billion
5,586 (Consolidated) 2,614 (Non-consolidated)
Cutting Tools, Forming Tools, Cutting Saws, Machine Tools, Precision Machinery, Machining Systems
Robot Systems, Electronic Equipment
Bearings, Hydraulic Equipment, Automotive Parts, Seismic Isolation Systems, Filtration Systems
Special Steels, Coating, Industrial Furnaces
1-1-1, Fujikoshi-Honmachi, Toyama 930-8511, Japan
Shiodome Sumitomo Bldg. 17F, 1-9-2, Higashi-Shinbashi, Minato-ku, Tokyo 105-0021, Japan
Shiodome Sumitomo Bldg. 17F, 1-9-2, Higashi-Shinbashi, Minato-ku, Tokyo 105-0021, Japan
Nachi Nagoya Bldg., 2-120-3, Takayashiro, Meitou-ku, Nagoya 465-0095, Japan
Nachi Osaka Bldg., 2-3-7, Honjo-nishi, Higashi-Osaka 578-8522, Japan

1-1-1, Fujikoshi-Honmachi, Toyama 930-8511, Japan[Cutting Tools / Machine Tools / Robots / Bearings]
3-1-1, Yoneda-machi, Toyama 931-8511, Japan [Special Steels]
3-2-1, Nakada, Toyama 931-8453, Japan [Hydraulic Equipment]
176, Ogake, Namerikawa 936-0802, Japan [Precision Machinery / Hydraulic Equipment /Automotive Hydraulics / Coating / Industrial Furnaces / Precision Forming]

Tel:+81-76-423-5111+81-3-5568-5111+81-3-5568-5280+81-52-769-6811+81-6-6748-2510+81-76-423-5111+81-76-438-4411+81-76-438-8970+81-76-471-2101

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INVESTOR INFORMATION
Securities Code:6474

Fiscal year:

From Dec. 1 of each year to Nov. 30 of
the following year

Ordinary General Meeting ofShareholders:Record Date:

Notification of Change of Address And Requests For
Purchase of Additional Shares or Buyback of Holdings
Less Than the Minimum Trading Unit

Unit:

1,000 shares

Please notify the securities company with which
you have your account.
For those shareholders who do not have an
account with a securities company and who have
set up a special account instead, please notify
Chuo Mitsui Trust and Banking Co., Ltd., which isthe account administrator for special accounts.

Shareholders’ Register
Custodian:

3-33-1, Shiba, Minato-ku, Tokyo, JapanThe Chuo Mitsui Trust and Banking Company, Ltd.

Payment of Accrued Dividends

Mailing address:

2-8-4, Izumi, Suginami-ku, Tokyo 168-0063, Japan(Contact via phone):

Toll-free: 0120-78-2031 (Toll-free in Japan)
Transactions are handled by Chuo Mitsui Trust andBanking Co., Ltd. and its branches nationwide andthe head office of Japan Securities Agents, Ltd.
and its branches nationwide.

URL:

http://www.nachi-fujikoshi.co.jp/February
Voting rights at General
Meeting of Shareholders
Year-end dividendInterim dividend

November 30
November 30
May 31The Chuo Mitsui Trust and Banking Company, Ltd.
Stock Transfer Agency Department

Please contact Chuo Mitsui Trust and Banking Co., Ltd.,
which administers the shareholders registry.

Wonders from NACHI, Art in NACHI
Exciting Technology—that’s Art.

The UFO-looking object on the cover is a bearing used in N700 series bullet trains.
Early bullet trains started with the 0 series. As these trains have become faster,
the bearings used have provided exceptional durability and evolved in terms offeatures and shape into lighter, smaller bearings.
This beautiful and unique form is evidence of our technology allowing safe
operations on tracks that would circle the globe 125 times over.
NACHI-FUJIKOSHI endeavors to create art in the world of manufacturing.