TOKYO ELECTRON

July 30, 2012

Consolidated Financial Review
for the First Quarter Ended June 30, 2012
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 three months ended June 30, 2012
Three months ended
June 30, 2011
June 30, 2012
Net sales (Millions of yen)
153,117
134,179
Operating income (Millions of yen)
23,0889,283
Ordinary income (Millions of yen)
23,751
11,248Net income (Millions of yen)
16,636
5,720
Net income per share (Yen)
92.91
31.93
Fully diluted net income per share (Yen)
92.76
31.88
Comprehensive income: Three months ended June 30,2012: 2,649 million yen
Three months ended June 30,2011:16,772 million yen(1) Operating results (Cumulative)(2) Financial position

Total assets (Millions of yen)
Net assets (Millions of yen)
Equity ratio (%)
Equity: 584,567 million yen (as of June 30, 2012)
586,789 million yen (as of March 31, 2012)

As ofMarch 31, 2012
783,610598,602
74.9

As of
June 30, 2012
767,049596,323
76.2

Year ended
March 31, 2012
53.00
27.00
80.00

Year ending
March 31, 2013
25.00 (Forecast)
26.00 (Forecast)
51.00 (Forecast)

2. Dividends
2Q-end dividend per share (Yen)
Year-end dividend per share (Yen)Annual dividend per share (Yen)
Note: Revision of dividends forecast : Yes
The interim dividend for the second quarter ending September 2012 is made up of ordinary dividend 15
yen and commemorative dividend 10 yen.
The year-end dividend for the year ending March 2013 is made up of ordinary dividend 16 yen andcommemorative dividend 10 yen.

3. Earnings forecasts for the year ending March 31, 2013
Six months ending
September 30, 2012
Net sales (Millions of yen)
Operating income (Millions of yen)
Net income (Millions of yen)
Net income per share (Yen)
Note: Revision of earnings forecast : Yes

268,000
9,500
6,000
33.49

1

Year ending
March 31, 2013
530,000
20,00014,00078.14

TOKYO ELECTRON

4. Others(1) Important changes in subsidiaries during the current period: None
(2) Adoption of special accounting method in preparing quartely 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 estimates: Yes
4. Restatement: None
(4) Number of shares outstanding (common stock)
1. Number of shares issued and outstanding (including treasury stock)
As of March 31, 2012:

180,610,911 shares

As of June 30, 2012:

180,610,911 shares

2. Number of shares of treasury stock
As of March 31, 2012:

1,446,079 shares

As of June 30, 2012:

1,437,590 shares

3. Average number of shares outstanding
As of June 30, 2011:

179,065,796 shares

As of June 30, 2012:

179,169,890 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

TOKYO ELECTRON

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

During the first quarter of the current fiscal year, financial instability in Europe remained unresolved, feelingsof uncertainty concerning China’s economic growth rate appeared, and other signs of an overall slowing
trend in the world economy were experienced. The pace of recovery of the Japanese economy wasmoderate as a result of the stagnation of the global economy.
In the electronics industry where the Tokyo Electron group conducts its business, smartphones continued toperform solidly, but sales of PCs and televisions remained sluggish, and there was limited recovery in thesemiconductor and LCD panel market overall.
Under these circumstances, consolidated net sales in the first quarter of the current fiscal year were134,179 million yen (down 12.4% from the same period of the previous year). Consolidated operating
income was 9,283 million yen (down 59.8% from the same period of the previous year), and consolidated
ordinary income was 11,248 million yen (down 52.6% from the same period of the previous year). Net
income for the first quarter was 5,720 million yen (down 65.6% from the same period of the previous year).

The overview of each business segment is as described below.

(i) Semiconductor Production Equipment
Smartphones failed to drive the semiconductor market as a whole, and semiconductor prices were soft. In
response, semiconductor manufacturers invested in equipment in some cutting-edge development fields,
but investment in equipment for memory was limited and overall there was no large-scale investment.
Under these circumstances, net sales from external customers in this segment during the first quarter of thecurrent fiscal year were 108,703 million yen (down 10.0% from the same period of the previous year).

(ii) FPD/PV (Flat Panel Display/Photovoltaic Panel) Production Equipment
Demand for televisions and PCs did not recover and demand for LCD panel production equipment was
sluggish. Under these circumstances, net sales from external customers in this segment during the firstquarter of the current fiscal year were 4,769 million yen (down 62.0% from the same period of the previousyear).

(iii) Electronic Components and Computer Networks
Sales of general-purpose ICs increased as a result of business acquired by a TEL consolidated subsidiaryfrom AMSC Co., Ltd., but demand declined because of the poor business confidence and the sales of otherelectronic components and information communications equipment were sluggish. Under these3

TOKYO ELECTRON

circumstances, net sales from external customers in this segment during the first quarter of the current
fiscal year were 20,605 million yen (up 4.9% from the same period of the previous year).

(iv) Others
Net sales from external customers in this segment during the first quarter of the current fiscal year were 101
million yen (up 5.2% compared to the same period of the previous year).

(For reference）
Consolidated Operating Results（ Millions of yen）
FY 2012Full YearNet Sales
Semiconductor Production Equipment
Japan
U.S.
EuropeKorea
TaiwanChina
S.E.Asia
FPD/PV Production Equipment
Electronic Components & Computer Networks
OthersOperating Income
Ordinary Income
Net Income

633,091
477,873
82,887
114,82149,325
108,740
75,01825,395
21,68369,88884,867461
60,44364,04636,725

1Q

2Q

3Q

4Q

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

177,576
137,882
15,881
32,601
8,792
50,20921,166
5,663
3,568
16,57722,964151
17,48917,3269,312

FY 20131Q
134,179
108,703
10,032
26,62910,457
24,21429,338
5,666
2,363
4,769
20,605
101
9,283
11,2485,720

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

Production and Order Performance
1. Production（ Millions of yen）
FY 2012Full Year

Semiconductor Production Equipment
FPD/PV Production Equipment
Total

Note:

452,364
55,855508,220

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

4

1Q

2Q

3Q

4Q

127,147
14,115
141,262

105,286
15,841
121,127

97,09816,035
113,134

122,832
9,863
132,695

FY 2013
1Q
96,681
2,121
98,803

TOKYO ELECTRON

2. Orders Received（ Millions of yen）
FY 2012Full Year

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

Note:

437,615
18,59884,276461
540,950

FY 2013
1Q

1Q

2Q

3Q

4Q

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

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

106,419
2,885
21,741
151
131,197

76,0292,829
22,631
101
101,590

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

3. Orders Backlog（Millions of yen）
FY 2012

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

1Q

2Q

3Q

4Q

220,798
61,875
17,235299,909

166,773
39,447
15,430221,651

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

188,684
14,20013,783
216,669

FY 2013
1Q
157,737
12,26015,809185,807

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 first quarter of the current fiscal year were 569,563 million yen, down
37,486 million yen compared to the end of the previous fiscal year. Major contributing factors included a
26,710 million yen decrease in trade notes and accounts receivable, a 13,606 million yen decrease inprepaid consumption tax, a 13,153 million yen decrease in short-term investments included in securities,
and an 18,220 million yen increase in cash and deposits.
Tangible fixed assets increased by 2,445 million yen from the end of the previous fiscal year, to 129,330
million yen.
Intangible fixed assets increased by 15,466 million yen from the end of the previous fiscal year, to 20,169
million yen as a result of a 15,543 million yen increase in goodwill and other factors.
Investments and other assets increased by 3,013 million yen from the end of the previous fiscal year, to47,984 million yen.
As a result, total assets decreased by 16,561 million yen compared to the end of the previous fiscal year, to
767,049 million yen.
Current liabilities were down 14,327 million yen compared to the end of the previous fiscal year, to 110,467

5

TOKYO ELECTRON

million yen. A major factor in the decrease was a decrease in trade notes and accounts payable of 11,361
million yen.
Long-term liabilities were up 45 million yen compared to the end of the previous fiscal year, to 60,258 million
yen.
Net assets were down 2,279 million yen compared to the end of the previous fiscal year, to 596,323 million
yen. The major factors were an increase from reporting a net income of 5,720 million yen for the current firstquarter, a decrease from payment of 4,837 million yen in year-end dividends in the previous fiscal year, anda 2,180 million yen decrease in translation adjustments owing to the yen’s appreciation. The equity ratio
was 76.2%.

(ii) Cash Flow
Cash and cash equivalents at the end of the first quarter of the current fiscal year decreased by 15,926
million yen compared to the end of the previous fiscal year, to 142,849 million yen. The combined balanceof cash and cash equivalents, plus 109,842 million yen in time deposits and short-term investments withdeposit terms of over three months (which are not included in cash and cash equivalents), increased by
5,067 million yen from the end of the previous fiscal year, to 252,692 million yen. The overall situation
regarding cash flow during the first quarter of the current fiscal year is as described below.
Cash flow from operating activities increased by 17,826 million yen compared to the same period of theprevious fiscal year to 35,864 million yen. Major factors contributing to the increase included cash flow
income from 11,231 million yen in income before income taxes, a 26,010 million yen decrease in tradenotes and accounts receivable, and a 13,541 million yen decrease in prepaid consumption tax. Major
adverse factors included an 11,425 million yen decrease in accounts payable.
Cash flow from investing activities was 46,065 million yen, compared to 58,748 million yen in the same
period of the previous fiscal year. This was primarily the result of 15,830 million yen in expenditures for theacquisition of subsidiary company shares in conjunction with changes in the scope of consolidation, 7,326
million yen in expenditures for the acquisition of tangible fixed assets, and a 21,000 million yen increase intime deposits and short-term investments.
Cash flow from financing activities was 4,889 million yen, mainly as a result of the payment of 4,837 million
yen in dividends. Cash flow from financing activities in the same period of the previous fiscal year was
14,209 million yen.

6

TOKYO ELECTRON

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)
Purchase of investments in subsidiaries resulting in change in scope of consolidation
Others (purchase of fixed assets)
Cash flow from financing activities
Effect of exchange rate changes on cash and cash equivalents

Three month ended
June 30, 2011

（ Millions of yen）
Three month ended
June 30, 2012

18,03823,423
4,744
11,412(15,650)686(6,578)(58,748)(54,000)(4,748)(14,209)53

35,864
11,231
5,585
26,0105,112(11,425)(650)(46,065)(21,000)(15,830)(9,234)(4,889)(835)

Net increase in cash and cash equivalents (decrease)(54,865)(15,926)

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

165,050
110,184

158,776
142,849

Cash and cash equivalents and time deposits and short-term investmentswith deposit terms of over three months (which are not included in cash andcash equivalents) at end of period

284,184

252,692

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TOKYO ELECTRON

3. Qualitative Information on Forecasts for Consolidated Financial Results

With the slowing global economy resulting in slowing semiconductor demand in turn, semiconductor device
makers are limiting capital investment. As a result, sales in the semiconductor production equipment
segment, our main business, are expected to fall short of the initial prediction, and we have revised our priorconsolidated forecasts for the first half and full fiscal year that we released on April 27, 2012.

Consolidated Forecast(Billions of yen, Y/Y change)
FY2013(E)Net Sales

1st Half
268.0-17.9%

Full Year
530.0-16.3%

Semiconductor Production Equipment
FPD/PV Production Equipment
Electronic Components & Computer Networks
Operating Income
Net Income

216.0
9.0
43.0
9.5
6.0

416.0
18.0
96.0
20.0
14.0

-13.0%-75.5%
4.8%-74.2%-77.5%-12.9%-74.2%
13.1%-66.9%-61.9%

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

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.

8

TOKYO ELECTRON

Consolidated Balance Sheet
As ofMarch 31, 2012ASSETS
Current assets
Cash and deposit

35,834(Millions of yen)
As ofJune 30, 2012

54,055Trade notes and accounts receivable

150,305

123,595

Securities

211,790

198,636

Merchandise and finished goods

101,789

100,287

Work in process

35,10431,329Raw materials and supplies

12,575

12,506

Others61,02650,272

Allowance for doubtful accounts(1,376)(1,119)607,050

569,563

126,885

129,330

4,703
4,703

15,543
4,626
20,16948,819(3,848)44,971
176,560
783,610

51,678(3,693)47,984
197,485
767,049

Total current assets
Long-term assets
Tangible fixed assets
Intangible fixed assets
Goodwill
OthersTotal intangible fixed assets
Investments and other assets
OthersAllowance for doubtful accounts
Total investments and other assets
Total long-term assets
Total assets

9

TOKYO ELECTRON

Consolidated Balance Sheet
As ofMarch 31, 2012
LIABILITIESCurrent liabilities
Trade notes and accounts payable(Millions of yen)
As ofJune 30, 2012

46,98635,625

Income taxes payable

4,288

8,468

Accrued warranty expenses

8,903

8,594

Other allowance

9,077

3,260

Others55,53754,518

Total current liabilities

124,794

110,467

54,64654,862

619

568

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

4,947

4,827

Total long-term liabilities

60,21360,258185,007

170,725

54,961
78,023471,186(9,747)594,42254,961
78,023472,063(9,689)595,358

3,575(51)(11,157)(7,633)
1,156
10,656598,6022,575(27)(13,338)(10,790)
1,167
10,588596,323

783,610

767,049

Total liabilities
NET ASSETS
Shareholders' equity
Common stock
Capital surplus
Retained earnings
Treasury stock
Total shareholders' equity
Accumulated other comprehensive income
Valuation difference on available-for-sale securities
Deferred gains or losses on hedges
Translation adjustments
Total accumulated other comprehensive income
Subscription rights to shares
Minority interests
Total net assets
Total liabilities and net assets

10

TOKYO ELECTRON

Consolidated Statement of Income(Millions of yen)Three months ended Three months ended
June 30, 2011
June 30, 2012
Net sales
Cost of sales

153,117
94,646

134,179
90,067Gross profit

58,47044,111

18,176

17,928Selling, general & administrative expenses
Research and development expenses
Others

17,204

16,899Total selling, general & administrative expenses

35,381

34,82723,088

9,283

-

513

Others842

1,516

Total non-operating income

842

2,029

44
63
71
179
23,75117
14
32
64
11,248

3
1,437
38
1,478

1
1

4
980
800
22
1,806
23,423
6,592
16,831
195
16,63617
17
11,231
3,255
2,194
5,782
62
5,720

Operating income
Non-operating income
Foreign currency translation gain

Non-operating expenses
Maintenance and operation cost of closed business bases
Compensation expenses
Foreign currency translation loss
OthersTotal non-operating expenses
Ordinary income
Unusual or infrequent profit
Gain on sale of fixed assets
Gain on collection written-off claims
OthersTotal unusual or infrequent profit
Unusual or infrequent loss
Loss on disposal of property, plant and equipment
Loss from earthquake damage
Loss on revaluation of investment securities
OthersTotal unusual or infrequent loss
Income before income taxes
Income taxes
Prior year’s corporate tax
Income before minority interests
Minority interests
Net income

11Consolidated Statement of Comprehensive Income

Income before minority interests

TOKYO ELECTRON

Three months ended
June 30, 2011

(Millions of yen)Three months ended
June 30, 2012

16,831

5,782

334(1,000)

Other comprehensive income
Valuation difference on available-for-sale securities
Deferred gains or losses on hedges
Translation adjustments
Total other comprehensive income
Comprehensive income

44

70

(437)

(2,202)(58)(3,132)

16,772

2,649

16,566

2,563

205

86

(Breakdown)Comprehensive income attributable to owners
Comprehensive income attributable to minority interests

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TOKYO ELECTRON

Segment Information(i) Overview of reportable segments

The reportable segments by the company provide separate financial information pertaining to the various
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 thereportable segments are as follows: Semiconductor Production Equipment, FPD/PV (Flat Panel Display andPhotovoltaic Panel) Production Equipment, and Electronic Components and Computer Networks.
The Semiconductor Production Equipment segment consists of coaters/developers, plasma etch systems,
thermal processing systems, single wafer deposition systems, cleaning systems used in wafer processing,wafer probers used in the wafer testing process and other semiconductor production equipment, and we areengaged in the development, manufacturing, sales and provision of maintenance services, etc. for suchproducts.
The FPD/PV Production Equipment segment consists of coaters/developers, plasma etch/ash systems usedin the manufacturing of flat panel displays, and plasma CVD systems used in the manufacturing of thin film
silicon PV panels, and we are engaged in the development, manufacturing, sales and provision ofmaintenance 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 areengaged in the design, development, procurement, and sales, etc. for such products.
(ii) Net sales and profit/loss in reportable segments
Three months ended June 30, 2012

(Millions of yen)
Reportable Segment

Semiconductor
Production
Equipment

FPD/PV Production
Equipment

Electronic
Components &Computer Networks

Others

Net sales

108,703

4,769

20,8283,077

Segment income
or loss

16,798(1,685)201

496

Total Segment

Eliminations

Consolidated Total

Net sales

137,378(3,198)134,179

Segment income
or loss

15,811(4,579)11,231

Notes:
1. The "Others" segment includes all other businesses which are not included in the reported businesssegments, 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 4,579 million yen includes corporate expenses
pertaining to the corporate account which are not allocated to any specific reportable segments. The
corporate account expenses are mainly R&D expenses of 4,683 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 net income before taxes in consolidated income statement.

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TOKYO ELECTRON

Segment Information(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:
During the first quarter, TEL acquired all the shares of U.S.-based NEXX Systems, Inc. whichbecame a consolidated subsidiary. As a result of this transaction, 15,310 million yen in goodwill
arose in the semiconductor production equipment segment. As the allocation of the goodwill
amount to the acquisition value is not complete, this is a provisional calculation of the amount.
Significant income related to negative goodwill: None14