TOKYO ELECTRON

April 28, 2011

Consolidated Financial Review
for the Year Ended March 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 year ended March 31, 2011
Year ended
March 31, 2010
March 31, 2011
Net sales (Millions of yen)
418,636
668,722
Operating income (Millions of yen)
(2,180)97,870Ordinary income (Millions of yen)
2,558
101,919
Net income (Millions of yen)
(9,033)71,924
Net income per share (Yen)(50.47)401.73
Fully diluted net income per share (Yen)
401.06Return on equity
(1.8)
13.3
Ordinary income to total assets
0.4
13.5
Operating income to net sales
(0.5)
14.6
Comprehensive income:Year ended 3/31/11: 69,598 million yen
Year ended 3/31/10: (4,750) million yen
Profit/loss on equity method:Year ended 3/31/11: - million yen
Year ended 3/31/10: - million yen(1) Operating results (Cumulative)(2) Financial position

Total assets (Millions of yen)
Net assets (Millions of yen)
Equity ratio (%)
Net assets per share (Yen)
Equity: 572,741 million yen (as of March 31, 2011)
511,818 million yen (as of March 31, 2010)

As ofMarch 31, 2010
696,351
523,36973.5
2,859.37

As ofMarch 31, 2011
809,205
584,801
70.8
3,198.66(Millions of yen)

(3) Cash flow

Year ended
March 31, 2010
March 31, 2011
48,284
83,2389,613(35,881)(287)(5,236)
123,939
165,050

Cash flow from operating activities
Cash flow from investing activities
Cash flow from financing activities
Cash and cash equivalents at end of period

1TOKYO ELECTRON
2. Dividends
Year ended
March 31, 2010

Year ended
March 31, 2011

4.00
8.00
12.00

38.00
76.00
114.00Year ended
March 31, 2010

Year ended
March 31, 2011

2,147
0.4

20,41228.4
3.8

1Q-end dividend per share (Yen)
2Q-end dividend per share (Yen)
3Q-end dividend per share (Yen)
Year-end dividend per share (Yen)Annual dividend per share (Yen)

Total dividend (Millions of yen)
Payout ratio (%)
Dividend on equity (%)

Year ending
March 31, 2012
(Forecast)Year ending
March 31, 2012
(Forecast)-

Note: Interim and year-end dividends for the fiscal year ending March 31, 2012 remain undecided as the result of theperformance forecast is currently under investigation. An official announcement of dividends together with theperformance forecast is planned for May 13, 2011.

3. Earnings forecasts for the year ending March 31, 2012
We are currently investigating the performance forecast for the fiscal year ending March 31, 2012 and have refrained
from publicizing it as the result of the direct and indirect influences of the Great East Japan Earthquake, which havecontinued to change by the hour since the earthquake struck on March 11, 2011. We plan to officially announce theforecast on May 13, 2011 after making assumptions on what is likely to happen in the future.

4. Others(1)

Important changes in subsidiaries. : None
(Changes on specific subsidiaries with changes in scope of consolidation)(2)

Changes in accounting principles, procedures and display of accounting method
concerning consolidated statement policies:
1. Changes in accounting policies: Yes
2. Other changes: None(3)

Number of shares outstanding (common stock)
1. Number of shares issued (including treasury stock)
2. Number of shares of treasury stock
3. Average number of shares outstanding

2

As of March 31, 2010
180,610,911

As of March 31, 2011
180,610,911

1,614,225

1,554,231

178,987,481

179,035,910

TOKYO ELECTRON(Reference) Non-consolidated financial review for the year ended March 31, 2011
1. Financial highlights for the year ended March 31, 2011
(1) Operating results
Note: Percentages indicate changes from the previous fiscal year.
Year ended
March 31, 2010
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)
Fully diluted net income per share (Yen)318,236(16,111)(13,985)(16,838)(94.08)-March 31, 2011%(18.3)-

569,298
30,62040,97831,928178.34178.04As ofMarch 31, 2010
533,081
334,495
62.5
1,859.91

As ofMarch 31, 2011
629,215359,13556.8
1,997.34(2) Financial position

Total assets (Millions of yen)
Net assets (Millions of yen)
Equity ratio (%)
Net assets per share (Yen)
Equity: 357,636 million yen (as of March 31, 2011)
332,917 million yen (as of March 31, 2010)* Notes on the status of auditing procedure execution
This earnings report is outside the jurisdiction of auditing procedures outlined in the Financial Instruments andExchange Act and remain incomplete at the time of announcing this report.
* Explanation of the appropriate use of earnings forecast:
The performance forecasts and estimates stated in this Financial Review are based on certain assumptions
judged to be reasonable at the present time in light of currently available information. Consequently, actual
operating results may differ substantially from the projections in this Financial Review.
The company plans to hold a financial meeting for analysts and investors on Friday, May 13, 2011. The
supplementary materials to these financial reports that will be handed out at this meeting will be posted
simultaneously on our company website.

3

%
78.9
-

Operating Results(1) Analysis of Operating Results(i) Business Environment during the Fiscal Year Ended March 31, 2011
During the fiscal year, the global economy as a whole took a turn toward recovery.

Some regions in Europe

and America continued to perform sluggishly, but the general trend was upwards starting in the second half.
Economic growth was strong in Asia, particularly in domestic demand in developing countries such as China
and India.

The Japanese economy showed signs of improvement, but little progress has been madebecause of the effects of the high value of the yen and an adverse employment environment as well as
concerns regarding the repercussions of the Great Eastern Japan Earthquake that occurred in March.

In the electronics industry, the primary area of the Tokyo Electron Group’s business activities, demand for
PCs and flat-panel televisions was strong through the first half but later there was some adjustment.
Demand for consumer electronics such as smartphones and tablet PCs increased rapidly, and the markets
for the semiconductors and flat-panel displays that are key components in these products was generally
favorable.

(ii) Overview of Profits and Losses during the Fiscal Year Ended March 31, 2011
Under these circumstances, the Group launched new high added value products and undertook active
measures to increase sales, and as a result, sales and profit recovered substantially from the previous fiscal
year.

Profits and losses for the fiscal year were as follows.

Consolidated net sales for the fiscal year increased by 59.7% compared to the previous fiscal year to668,722 million yen.

Domestic net sales increased by 12.0% to 182,165 million yen, and overseas net sales

increased 90.0% to 486,557 million yen with overseas net sales accounting for 72.8% of consolidated net
sales.

Consolidated orders for the fiscal year increased 53.6% to 734,893 million yen, and consolidated

order backlogs rose 27.3% to 308,809 million yen.

The Great Eastern Japan Earthquake caused minor damage to some of the Group’s plants buildings andequipment, resulting in temporary suspensions of production and shipments, but there was almost no impact
on consolidated sales and inventories during the fiscal year.

The cost of sales increased 39.8% to 433,963 million yen and gross profit was up 116.7% to 234,758 million
yen.

As a result, the gross profit margin rose 9.2 percentage points to 35.1%.

Selling, general, and administrative (SG&A) expenses increased 23.9% to 136,887 million yen, and the ratio
to consolidated net sales decreased by 5.9 percentage points to 20.5%.

4

As a result of these developments, operating income was 97,870 million yen compared to an operating lossof 2,180 million yen in the previous fiscal year.

Ordinary income, adjusted for non-operating income of

4,827 million yen and non-operating expenses of 778 million yen, was 101,919 million yen, compared toordinary income of 2,558 million yen in the previous fiscal year.

Unusual income was 2,134 million yen including reversal of allowance for doubtful accounts and unusual
losses amounted to 4,475 million yen for a net unusual loss of 2,340 million yen, compared to an unusual
loss of 10,326 million yen in the previous fiscal year.

Unusual or infrequent losses included 1,113 million

yen in earthquake-related expenses, 1,839 million yen in expenses related to transfer to the new Miyagi
Plant.

Income before income taxes for the fiscal year was 99,579 million yen (compared to 7,767 million yen inlosses before income taxes in the previous fiscal year), and net income was 71,924 million yen (compared to
9,033 million yen in net losses in the previous fiscal year).
As a result, net income per share was 401.73 yen (negative 50.47 yen in the previous fiscal year).

(iii) Overview of Operations during the Fiscal Year Ended March 31, 2011 by Business Segment

Semiconductor Production Equipment
The expansion of new semiconductor applications such as smartphones and tablet PCs resulted in a rapid
recovery of the semiconductor market, particularly flash memory and logic semiconductors.

The DRAM

market was somewhat weak as a result of a downturn in PC demand starting in the second half, butinvestment in wafer fab equipment was increased sharply from the previous fiscal year.

As a result ofproactively promoting sales expansion of the latest products such as coater/developer (CLEAN TRACK™
LITHIUS Pro™ V), plasma etch system (Tactras™ Vigus™), thermal processing system (TELINDY PLUS™),
net sales from external customers in this segment during the fiscal year under review were up 94.9% fromthe previous fiscal year to 511,331 million yen.

FPD/PV (Flat Panel Display/Photovoltaic Cell) Production Equipment
In the FPD production equipment business, the large LCD panel market entered an inventory adjustment
phase, but investment in the new equipment for small- and medium-sized LCD panels was brisk thanks tostrong demand for smartphones and tablet PCs, and the overall market was firm.

In the photovoltaic cell

production equipment business, the thin-film silicon PV cell market that TEL is entering is still in its earlystages, but substantial growth is expected over the medium to long term as energy policies are reviewed
worldwide.

As a result of these developments, net sales from external customers in this segment during the

fiscal year under review were down 6.5% from the previous fiscal year to 66,721 million yen.

5Electronic Components and Computer Networks
In the semiconductor and electronic devices business, demand for semiconductor products related to digital
home electronics such as flat-panel televisions and peripheral devices and other consumer electronics was
weak since the beginning of the year.

In contrast, demand for industrial equipment including medical

equipment, semiconductor production equipment (SPE), and factory automation equipment was strong, andsales of analog ICs and custom ICs increased.

In the computer systems related business, sales ofcomputer network products were sluggish, but sales of software for embedded devices were strong and themaintenance service business performed well.

As a result of these developments, net sales from externalcustomers in this segment during the fiscal year under review were up 6.8% from the previous fiscal year to90,216 million yen.

Other
Net sales from external customers for this segment during the fiscal year increased by 10.4% compared tothe previous fiscal year to 453 million yen.

Note: Beginning in the current consolidated fiscal year, business segment information is provided in conformity with the AccountingStandard for Disclosures about Segments of an Enterprise and Related Information (Corporate Accounting Standards, ASBJ
Statement No. 17, dated March 27, 2009), and Guidance on Accounting Standard for Disclosures about Segments of an Enterpriseand Related Information (Corporate Accounting Standards, ASBJ Guidance No. 20, dated March 21, 2008).

As a result,comparisons of net sales from external customers to results from the same period of the previous fiscal year for each businesssegment are made after arrangement of the financial results from the previous fiscal year into the reported segments following
application of the above standards.

(For reference）
Consolidated
Year ended March 31, 2011
1Q
2Q
Net Sales
144,889 173,510
Semiconductor Production Equipment
103,166 137,063
Japan
18,404 28,547
U.S.
17,552 22,474
Europe
2,942
7,028
Korea
21,445 30,126
Taiwan34,014 37,082
China
4,649
5,195
S.E.Asia
4,158
6,608
FPD/PV Production Equipment
20,306 12,553
Electronic Components & Computer Networks 21,321 23,754
Others95
138
Operating Income (Loss)
18,321 24,020
Ordinary Income (Loss)
19,063 26,043
Net Income (Loss)
14,727 18,726（Millions of yen）
Year ended
First
SecondFull Year
March 31, 2010
Half
3Q
4Q
Half
318,400 159,662 190,658 350,321 668,722
418,636240,229 115,373 155,728 271,101 511,331
262,391
46,952 16,927 24,060 40,988 87,940
44,17440,026 20,974 41,897 62,871 102,898
55,5559,970
5,609 12,902 18,511 28,482
10,93751,571 17,092 19,194 36,287 87,858
44,716
71,097 35,383 43,802 79,185 150,282
76,7959,844
7,960
7,787 15,748 25,593
7,616
10,766 11,424
6,084 17,509 28,275
22,59532,860 21,992 11,867 33,860 66,721
71,36145,075 22,222 22,917 45,140 90,216
84,473
234
73
145
218
453
410
42,342 25,815 29,713 55,528 97,870(2,180)45,107 26,667 30,145 56,812 101,919
2,558
33,454 18,667 19,802 38,470 71,924(9,033)

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

6

(iv) Projected Operating Results for the Next Fiscal Year Ending March 31, 2012

We are currently investigating the performance forecast for the fiscal year ending March 31, 2012 and haverefrained from publicizing it as the result of the direct and indirect influences of the Great East Japan
Earthquake, which have continued to change by the hour since the earthquake struck on March 11, 2011. We
plan to officially announce the forecast on May 13, 2011 after making assumptions on what is likely to happen
in the future.

(2) Analysis of Financial Conditions(i) Financial Conditions
Current assets at the end of the fiscal year rose 91,292 million yen from the end of the previous fiscal year to644,231 million yen.

The major factors resulting in the increase were a 45,057 million yen increase incertificates of deposit included in securities and a 30,475 million yen increase in inventories.
Tangible fixed assets increased by 20,424 million yen from the end of the previous fiscal year to 112,551
million yen.
Intangible fixed assets decreased by 1,373 million yen from the end of the previous fiscal year to 4,212
million yen.
Investments and other assets increased by 2,510 million yen compared to the end of the previous fiscal year
to 48,209 million yen.
As a result, total assets increased by 112,853 million yen from the end of the previous fiscal year to 809,205
million yen.
Current liabilities increased by 48,876 million yen from the end of the previous fiscal year to 168,038 million
yen.

The major factors in the increase were a 20,972 million yen increase in income taxes payable and a

9,847 million yen increase in customer advances.
Long-term liabilities were up 2,545 million yen compared to the end of the previous fiscal year to 56,365
million yen.
Net assets increased by 61,432 million yen from the end of the previous fiscal year to 584,801 million yen asa result of net income of 71,924 million yen reported in the current fiscal year and payment of year-end
dividends of 1,431 million yen for the previous fiscal year and interim dividends of 6,804 million yen for thecurrent fiscal year.

The equity ratio was 70.8%.

(ii) Cash Flow
The balance of cash and cash equivalents at the end of the fiscal year increased from 123,939 million yen at
the end of the previous fiscal year by 41,110 million yen to 165,050 million yen. The combined balance of7cash and cash equivalents plus 120,000 million yen in time deposits and certificates of deposit with deposit
terms of over three months (which are not included in cash and cash equivalents) was 285,050 million yen.
Cash flows during the fiscal year under review were as follows.

Cash flow from operating activities increased by 34,953 million yen compared to the same period of theprevious fiscal year to 83,238 million yen. Major positive factors included net income before income taxes of
99,579 million yen, depreciation and amortization of 17,707 million yen, and an increase in customer
advances of 9,575 million yen.

The major negative factors were an increase in inventories of 36,532 million

yen, an increase in trade notes and accounts receivable of 13,319 million yen, and the payment of 7,583
million yen in income taxes.

Cash flow from investing activities was a negative 35,881 million yen compared to the positive 9,613 million
yen in the same period of the previous fiscal year, primarily as a result of payment of 33,541 million yen forthe purchase of tangible fixed assets.

Cash flow from financing activities was 5,236 million yen, primarily as a result of the payment of 8,236 million
yen in dividends.

Cash flow from financing activities in the previous fiscal year was 287 million yen.

Equity ratio (%)
Equity ratio at market value (%)
Interest-bearing debt to cash flow ratio (times)
Interest coverage ratio (times)

Fiscal year ended
March 31, 2010
73.5
159.4
0.1
1047.59

Fiscal year ended
March 31, 2011
70.8
101.5
0.1
1824.28

Equity ratio: (Equity / Total assets) x 100
Equity ratio at market value: (Market capitalization / Total assets) x 100
Interest-bearing debt to cash flow ratio: Interest-bearing debt / Cash flow from operating activities
Interest coverage ratio: Cash flow from operating activities / Interest expenses* All indicators are calculated using financial figures on a consolidated basis.
* Market capitalization is calculated based on the following formula: Closing stock price at fiscal year-end × Number of shares
outstanding at fiscal year-end after deduction of treasury stock.
* Cash flow from operating activities corresponds to the cash flow from operating activities in the consolidated statement of cash
flow. Interest-bearing debt includes all liabilities for which the Company is paying interest among the liabilities reported on the
consolidated balance sheet. Interest expenses correspond to the interest paid in the consolidated statement of cash flow.

8(3) Basic Policy for Profit Allocation and Payment of Dividends for the Current and Next Fiscal Years

TEL’s basic policy for returning profits to shareholders by maintaining a payout ratio of around 20% based on
consolidated net income was revised on November 2, 2010 by the Board of Directors, in order to increase thetarget payout ratio to 35% based on consolidated net income starting with the year-end dividend for the fiscal
year ended March 2011.

TEL effectively uses internal capital reserves to raise corporate value through earnings growth and provides
returns directly to shareholders by concentrating investment in high-growth areas and linking dividend
payments to business performance and earnings on a continual basis. We will maintain our policy ofactively investing in research and development, facilities, and human resources to establish the foundations
for future growth.

The Board’s decision to raise the consolidated payout ratio as a means of providing

greater returns to shareholders was based on the results of a review of medium-term projections of businessand financial conditions.

In the current fiscal year (the fiscal year ended March 2011), an interim dividend of 38 yen per share was
declared, and a year-end dividend of 76 yen per share is planned pursuant to application of the new policy toconsolidated financial results for the second half.

As a result, the dividend for the entire fiscal year including the interim dividend will be 114 yen per share.

The dividend for the next fiscal year (ending March 2012) is undetermined at this time as we are currently
examining projections of financial performance, however we plan to make an announcement on May 13,
2011 at the time of releasing these financial projections.

Management Policies(1) Basic Management Policy
The basic management policy of the TEL Group is to raise its corporate value through profit-oriented
operations by placing the highest priority on customers, enhancing product and technology development
capabilities, and invigorating its workforce.

Under

this

basic

policy,

the

TEL

Group

engagesinthedevelopmentofdynamic

andinternationally-competitive companies with high growth potential and profitability to make its shares attractive
to investors.

9(2) Management Tasks
The Group engages in dynamic business activities in the electronics industry, a field characterized by rapid
technological innovation, and is one of the world’s leading suppliers of semiconductor and flat panel display(FPD) production equipment.

In accordance with this status, its fundamental principles are as outlined

below.
-

Provide high-value products and services in the world in order to realize healthy and high quality life-

Show much leadership as a world-wide leading company for constructing society of dreams andprogressing environmental problems-

Share a sense of mission with all TEL employees, and a company of radiant existence, dreams, andvitality

To implement these fundamental principles, we have adopted the following concrete management policies.
1.

Be an innovative company that creates groundbreaking technologies

2.

Strive to be a highly-competitive global leader

3.

Offer solutions that best meet customer needs

4.

Make global responses and contributions to environmental issues

Based on these management policies, the TEL Group implements the following priority measures.

1. Reinforce Research and Development Capabilities
Maintaining and extending research and development capabilities are essential for making the technologicalinnovations necessary for establishing a more prosperous world and marketing competitive new products ina timely manner.

The TEL Group has prioritized the development of next-generation and differentiating

technologies with a focus on semiconductor and FPD production equipment, a field that is expected toundergo rapid growth in the future. We also use technologies accumulated over many years to cultivate anddevelop new businesses such as organic EL display and photovoltaic cell production equipment and provide
high added value products.

2. Reinforce Manufacturing Capabilities
The TEL Group has established integrated development and mass production functions and is enhancing its
manufacturing capabilities to reduce manufacturing costs, shorten manufacturing times, and raise quality
while shortening the development times of high added value products. We are currently constructing a newplant in Taiwa, Miyagi Prefecture, which will conduct integrated operations from development to mass
production of etch systems for semiconductors, a market that is expected to grow.
to raise its market share.

As a result, TEL expects

The new plant will also work toward raising productivity and reducing production

times through the adoption of production method innovations, and will mass-produce equipment using a

10radial line slot antenna, a new plasma technology.

In addition, we are constructing a new FPD production equipment manufacturing site in Kunshan City in
China’s Jiangsu Province to provide timely products and services in response to demand for FPD production
equipment in China and other parts of Asia, and to raise cost competitiveness.

3. Strengthen the Provision of Optimal Solutions
The Group is strengthening partnerships with customers not only in sales and services, but in development
as well. We are establishing overseas development sites in New York State in the United States and in
Hsinchu City, Taiwan, as well as strengthening collaboration with research organizations in Europe and theUnited States. We also plan to establish a new development site in South Korea.

In addition, we areintegrating group equipment and incorporating field engineering into the organizational structures of eachproduction site, in order to enhance our ability to make rapid and appropriate proposals in response to thebroad-ranging technology needs of customers. We are reinforcing the field solution business so we can not
only market and sell state-of-the-art equipment, but also relocate, modify, and enhance the performance ofequipment we have already sold.

4. Measures to Address Environmental Issues
The TEL Group is implementing measures to reduce the environmental impact of its business and logistics
activities. We are also implementing industry-wide environmental countermeasures intended to halve thetotal environmental impact of customer plants by 2015 compared to 2007 by reducing greenhouse gases
emissions, electricity usage and water consumption.

In addition to these measures, we will continue optimal placement of human resources and enhancement ofskills development programs to support the development of human resources that can respond to changes inthe business environment and serve as a source of growth.

We will also create fair evaluation andcompensation systems based on the degree of employee contribution and link them to create a company
filled with dreams, and vitality.

While the Great Eastern Japan Earthquake that occurred in March had only minimal impact on the TELGroup’s production facilities, the Group is making concerted efforts to address concerns regarding supply
chains and electric power shortages, primarily in the territories of Tokyo Electric Power.

Based on its profit-oriented management, the Group will continue, to enhance its corporate value byimplementing a customer-first policy, improving product and technology development capabilities,
strengthening international competitiveness, and motivating employees.

11

TOKYO ELECTRON

Consolidated Balance Sheet(Millions of yen)
As ofMarch 31, 2010

As ofMarch 31, 2011ASSETS
Current assets
Cash and deposit

56,93952,992

Trade notes and accounts receivable

124,462

136,385

Securities

187,000

232,057

Merchandise and finished goods

87,201111,918

Work in process

37,79343,246

Raw materials and supplies

13,455

13,760

Deferred income taxes

26,62527,609Others

19,63827,414(176)(1,153)552,939644,231

120,429

121,597

Accumulated depreciation(75,001)(75,363)

Buildings and structures, net

45,42846,23470,03675,735

Accumulated depreciation(56,854)(58,755)

Machinery and carriers, net

13,182

16,980Land

26,35525,772

Construction in progress

3,739

19,509Allowance for doubtful accounts
Total current assets
Long-term assets
Tangible fixed assets
Buildings and structures

Machinery and carriers

Others28,90628,963(25,484)(24,909)

3,421

4,054

92,127

112,551

Others

5,586

4,212

Total intangible fixed assets

5,586

4,212

Investment securities

14,72015,725

Deferred income taxes

20,505

20,727

Others17,924

13,786

Allowance for doubtful accounts(7,452)(2,031)

Accumulated depreciation
Others, net
Total tangible fixed assets
Intangible fixed assets

Investments and other assets

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

1245,69848,209143,412

164,973

696,351809,205

TOKYO ELECTRON(Millions of yen)
As ofMarch 31, 2010

As ofMarch 31, 2011

LIABILITIESCurrent liabilities
Trade notes and accounts payable
Income taxes payable

52,35953,612-

25,328

Accrued employees' bonuses

6,043

11,130Accrued warranty expenses

5,267

7,594

Others55,49070,372

Total current liabilities

119,161

168,038

Accrued pension and severance costs

49,90652,230

Others

3,913

4,134

Total long-term liabilities

53,82056,365

172,982

224,403

Common stock

54,961

54,961

Capital surplus

78,03478,045Retained earnings

393,970

457,658

Treasury stock(10,900)(10,484)

Total shareholders' equity

516,065

580,180

2,504

2,807

(67)

(12)

Translation adjustments(6,683)(10,234)

Total accumulated other comprehensive income(4,247)(7,439)Subscription rights to shares

1,578

1,499

Minority interests

9,973

10,560Total net assets

523,369

584,801

696,351809,205

Long-term liabilities

Total liabilities
NET ASSETS
Shareholders' equity

Accumulated other comprehensive income
Valuation difference on available-for-sale securities
Deferred gains or losses on hedges

Total liabilities and net assets

13

TOKYO ELECTRON

Consolidated Statement of Income(Millions of yen)
Year ended
March 31, 2010

Year ended
March 31, 2011

Net sales

418,636

668,722

Cost of sales

310,320433,963

Gross profit

108,316

234,758

Salaries and allowances

18,084

19,938Provision for accrued bonuses

1,765

3,243

Provision for retirement allowances

2,358

2,222

Other personal expenses

6,400

8,872

Depreciation and amortization

5,605

4,386

Research and development expenses

54,07470,568Selling, general & administrative expenses

Others

22,20827,655

Total selling, general & administrative expenses

110,496

136,887(2,180)97,870Operating income (loss)
Non-operating income
Interest income

993

612

Revenue from development grants

1,842

3,026

Others

2,494

1,188

Total non-operating income

5,331

4,827

Non-operating expenses
Building demolition cost
Maintenance and operation cost of closed business bases
Loss on revaluation of investment securities

185

Lease expenses of fixed assets

103

Foreign currency translation loss

-

226

-

185
-

-

143

Others302

Total non-operating expenses

591

778

2,558

101,919

Ordinary income

222

Unusual or infrequent profit
Reversal of allowance for doubtful accounts

-

1,891

Gain on sale of fixed assets

282

Others17242-

Total unusual or infrequent profit

299

2,134

977

624

Unusual or infrequent loss
Loss on sale or disposal of fixed assets
Loss on impairment

7,553

Loss from earthquake damage
Plant relocation expenses
Expenses for integration and closure of business bases
Others

810
-

1,113

-

1,839

1,908

-

186

86

Total unusual or infrequent loss

10,626

4,475

Income (loss) before income taxes(7,767)

99,579Provision for income taxes and enterprise taxes

5,747

29,482

Deferred income taxes(5,020)(2,711)726

26,771

Total income taxes
Income before minority interests-

72,807

Minority interests

539

883

Net income (loss)(9,033)71,924

14

TOKYO ELECTRON

Consolidated Statement of Comprehensive Income(Millions of yen)
Year ended
March 31, 2010

Income before minority interests

Year ended
March 31, 2011-

72,807

Valuation difference on available-for-sale securities-

303

Deferred gains or losses on hedges-

71

Translation adjustments-(3,584)

Total other comprehensive income-(3,209)-69,598Comprehensive income of attributable to owners-

68,732Comprehensive income attributable to minority interests-

866

Other comprehensive income

Comprehensive income(Breakdown)

Reference:
Consolidated comprehensive income for the year ended March 31, 2010
(Millions of yen)
Other comprehensive income
Valuation difference on available-for-sale securities
Deferred gains or losses on hedges
Translation adjustments
Total other comprehensive income

3,349
(151)
545
3,743

Comprehensive income
Comprehensive income of attributable to owners
Comprehensive income attributable to minority interests
Total comprehensive income(5,269)518(4,750)15

TOKYO ELECTRON

Consolidated Statements of Changes in Net Assets(Millions of yen)
Year ended
March 31, 2010

Year ended
March 31, 2011

54,961
54,961

54,961
54,961

78,114(79)
78,03478,034
11
78,045404,435(1,431)(9,033)393,970

393,970(8,236)71,924
457,658(11,111)(58)
270(10,900)(10,900)(37)
453(10,484)

526,398(1,431)(9,033)(58)
190
516,065

516,065(8,236)71,924(37)
464
580,180

Shareholders' equity
Common stock
Balance at beginning of period
Balance at end of period

Capital surplus
Balance at beginning of period
Disposal of treasury stock
Balance at end of period

Retained earnings
Balance at beginning of period
Cash dividends
Net income (loss)
Balance at end of period

Treasury stock
Balance at beginning of period
Purchase of treasury stock
Disposal of treasury stock
Balance at end of period

Total shareholders' equity
Balance at beginning of period
Cash dividends
Net income (loss)
Purchase of treasury stock
Disposal of treasury stock
Balance at end of period

16

TOKYO ELECTRON

Consolidated Statements of Changes in Net Assets(Millions of yen)
Year ended
March 31, 2010

Year ended
March 31, 2011

Accumulated other comprehensive income
Valuation difference on available-for-sale securities
Balance at beginning of period
Net change except shareholders' equity
Balance at end of period

(842)
3,346
2,504

2,504
303
2,807

Deferred gains or losses on hedges
Balance at beginning of period
Net change except shareholders' equity
Balance at end of period

66
(134)
(67)

(67)
55
(12)

Translation adjustments
Balance at beginning of period
Net change except shareholders' equity
Balance at end of period(7,235)551(6,683)(6,683)(3,550)(10,234)

Total accumulated other comprehensive income
Balance at beginning of period
Net change except shareholders' equity
Balance at end of period(8,011)
3,764(4,247)(4,247)(3,192)(7,439)

1,148
429
1,578

1,578
(78)
1,499

9,729
244
9,973

9,973
587
10,560529,265(1,431)(9,033)
(58)
190
4,438
523,369

523,369(8,236)71,924(37)
464(2,683)584,801

Subscription rights to shares
Balance at beginning of period
Net change except shareholders' equity
Balance at end of period

Minority interests
Balance at beginning of period
Net change except shareholders' equity
Balance at end of period

Total net assets
Balance at beginning of period
Cash dividends
Net income (loss)
Purchase of treasury stock
Disposal of treasury stock
Net change except shareholders' equity
Balance at end of period

17

TOKYO ELECTRON

Consolidated Cash Flow

(Millions of yen)
Year ended
March 31, 2010

Year ended
March 31, 2011

Cash flow from operating activities
Income (loss) before income taxes
Depreciation and amortization
Loss on impairment
Increase in accrued pension and severance costs (decrease)
Increase in allowance for doubtful accounts (decrease)
Increase in accrued employees' bonuses (decrease)
Increase in accrued warranty expenses (decrease)
Interest and dividend revenue
Loss on disposal of fixed assets
Decrease in trade notes and accounts receivable (increase)
Decrease in inventories (increase)
Increase in accounts payable (decrease)
Decrease in prepaid consumption tax (increase)
Increase in accrued consumption tax (decrease)
Increase in customer advances (decrease)
Decrease in specific doubtful receivables (increase)
OthersSubtotal
Receipts from interest and dividends
Interest paid
Income taxes paid or refund (paid)
Net cash generated by operating activities(7,767)20,001
7,553
2,828
120
1,078
(836)
(1,055)916(4,890)(4,868)27,975568(6,380)(139)
6,377
41,480
1,171
(46)
5,679
48,284

99,57917,707810
2,342(4,341)
5,086
2,352
(696)
(13,319)(36,532)
1,667(8,025)
2,304
9,575
5,302
6,308
90,121745(45)(7,583)
83,238(449,000)
473,347(14,194)
488
(786)
(241)
9,613

(360,000)
360,000(33,541)509(925)(1,923)(35,881)1,299
131(1,431)
(286)
(287)

2,890
427
(8,236)(318)(5,236)445
58,05665,883
123,939(1,009)41,110123,939
165,050

Cash flow from investing activities
Payment into time deposits
Proceeds from time deposits
Payment for purchase of tangible fixed assets
Proceeds from sale of tangible fixed assets
Payment for purchase of intangible fixed assets
OthersNet cash used in investing activities

Cash flow from financing activities
Net increase in short-term borrowings (decrease)
Net decrease in treasury stock (increase)
Dividends paid
OthersNet cash generated by financing activities

Effect of exchange rate changes on cash and cash equivalents
Net increase in cash and cash equivalents (decrease)
Cash and cash equivalents at beginning of period
Cash and cash equivalents at end of period

18

TOKYO ELECTRON

Segment Information(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),
and the reportable segments are as follows: Semiconductor Production Equipment, FPD/PV (Flat
Panel Display and Photovoltaic Cell) Production Equipment, and Electronic Components andComputer 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) Ways of estimating net sales and profits, or losses, assets, and other amounts by reportable segment.
Accounting method used in each reportable segment is almost the same as the method used toprepare consolidated financial statements. Inter-segment revenues or transfers are based onprevailing market prices. Moreover, shared assets have not been allotted to each reportablesegments, but associated costs have been distributed among them according to rational standards.

19

TOKYO ELECTRON

Segment Information(iii) Net sales and profits, or losses, assets, and other amounts by reportable segment
Year ended March 31, 2011

( Millions of yen)
Reportable Segment
Semiconductor
Production
Equipment

Electronic
Components &Computer
Networks

FPD/PV
Production
Equipment

Others*1

511,331

66,721

90,216

453

0

-

1,099

14,907

Net sales

511,331

66,721

91,315

15,361

Segment income

120,845

6,640

2,907

1,916

Segment assets

239,70742,81250,254

2,093

Depreciation and amortization

7,369

543

455

353

Increase in the amount of tangible fixed
assets and intangible fixed assets

13,181

553

774

27

Sales to external customers
Inter-segment sales or transfers

Total Segment

Consolidated
Total
*3

Eliminations*2

Sales to external customers

668,722-668,722

Inter-segment sales or transfers

16,007(16,007)

Net sales

684,729(16,007)

668,722

Segment income

132,309(32,730)

99,579Segment assets

334,868

474,336809,205

Depreciation

8,721

8,985

17,707

Increase in the amount of tangible fixed
assets and intangible fixed assets

14,536

26,723

41,260-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 a) The eliminations of segment income amounting to 32,730 million yen includes corporate expenses pertaining to thecorporate account which are not allocated to any specific reportable segments. The corporate account expenses aremainly R&D expenses of 22,718 million yen, pertaining to fundamental research and element research conducted by thecompany not related to any of the reportable segments.
b) The main constituents of the eliminations of segment assets worth 474,336 million yen are cash, savings, securities,buildings and structures, etc. unallocated to each reportable segment.
c) The main constituent of the eliminations of tangible fixed assets and intangible fixed assets worth 26,723 million yen iscapital investments in buildings and structures unallocated to each reportable segment.
*3

Segment income is adjusted against net income before taxes in consolidated income statement.

(Additional Information)
From this consolidated fiscal year, the business segment information is provided in conformity with the "Accounting Standard forDisclosures about Segments of an Enterprise and Related Information" (Corporate Accounting Standards, ASBJ Statement
No.17, dated March 27, 2009), and "Guidance on Accounting Standard for Disclosures about Segments of an Enterprise andRelated Information" (Corporate Accounting Standards, ASBJ Guidance No.20, dated March 21, 2008).

20