TOKYO ELECTRON

February 5, 2013

Consolidated Financial Review
for the Third Quarter Ended December 31, 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 nine months ended December 31, 2012
Nine months ended
December 31, 2011
December 31, 2012
Net sales (Millions of yen)
455,514358,511
Operating income (Millions of yen)
42,953
5,336
Ordinary income (Millions of yen)
46,7208,805
Net income (Millions of yen)
27,412(936)
Net income per share (Yen)
153.06(5.23)
Fully diluted net income per share (Yen)
152.82Comprehensive income:Year ended December 31, 2012: 3,099 million yen
Year ended December 31, 2011: 21,559 million yen(1) Operating results (Cumulative)(2) Financial position

Total assets (Millions of yen)
Net assets (Millions of yen)
Equity ratio (%)
Equity: 580,475 million yen (as of December 31, 2012)
586,789 million yen (as of March 31, 2012)

As ofMarch 31, 2012
783,610598,602
74.9

As of
December 31, 2012
753,598592,330
77.0

2. Dividends
Year ended
March 31, 2012
53.00
27.00
80.00

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

2Q-end dividend per share (Yen)
Year-end dividend per share (Yen)Annual dividend per share (Yen)
Note: Revision of dividends forecast : No
The interim dividend for the second quarter ended 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
Year ending
March 31, 2013
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

495,000
9,500
4,500
25.11

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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 December 31, 2012:

180,610,911 shares

As of March 31, 2012:

180,610,911 shares

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

1,427,121 shares

As of March 31, 2012:

1,446,079 shares

3. Average number of shares outstanding
Nine months ended December 31, 2012: 179,175,008 shares
Nine months ended December 31, 2011: 179,100,704 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 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 2012),
growth in the global economy including Japan remained generally sluggish due to concerns regarding
future developments such as slowing the ratio of economic growth in many emerging countries including
China, the European debt crisis, and lower government expenditure in the United States.
In the electronics industry, the field of business where the Tokyo Electron Group is engaged, the launch of anew operating system for PCs did not generate demand, and PC sales volume fell below the prior fiscal
year’s level. In addition, smartphones had been a driving force in the industry, but they have now become
widespread in developed countries, and their growth was lower than initially expected at the beginning of
the year. Therefore, the performance of the electronic components market remained low.
Given this background, consolidated net sales for the first three quarters of the current fiscal year were358,511 million yen (down 21.3% from the same period of the previous year). Consolidated operating
income was 5,336 million yen (down 87.6% from the same period of the previous year), and consolidated
ordinary income was 8,805 million yen (down 81.2% from the same period of the previous year). Net loss
for the first three quarters was 936 million yen (compared to net income of 27,412 million yen in the same
period of the previous year).

The overview of each business segment is as described below.

(i) Semiconductor Production Equipment
There was little sign of a recovery in PC sales and the slump in PC-use DRAM business continued. Growthin demand for DRAMs and flash memories for mobile devices including smartphones and tablet PCs was
also sluggish, and semiconductor manufacturers, particularly memory manufacturers, continued production
adjustments. As a result, there was little capital investment in expanding facilities. Capital investment inadvanced equipment to manufacture some logic-based semiconductor products continued, but thesemiconductor production equipment market as a whole continues to undergo a correction phase. Given
these circumstances, net sales from external customers in this segment during the first three quarters of thecurrent fiscal year were 282,723 million yen (down 16.8% compared to the same period of the previousyear).

(ii) FPD/PV (Flat Panel Display/Photovoltaic Panel) Production Equipment
Sales of some high-performance LCD panels, particularly small- and medium-sized panels, increased, but
LCD panel manufacturers continued to adjust production, and demand for LCD panel production equipment

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TOKYO ELECTRON

remained low. Given these circumstances, net sales from external customers in this segment during the first
three quarters of the current fiscal year were 13,912 million yen (down 73.9% compared to the same periodof the previous year).

(iii) Electronic Components and Computer Networks
In the electronic components segment, demand for digital home appliance related products and industrial
equipment related products was stagnant, and IT investment in Japan was held off due to uncertainty
concerning the economy. Sales of computer networks related products were also low. Given thesecircumstances, net sales from external customers in this segment during the first three quarters of thecurrent fiscal year were 61,570 million yen (down 0.5% 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 305 million yen (down 1.6% compared to the same period of the previous year).

(For reference)

Consolidated Operating Results（ Millions of yen）
FY2013

Net Sales
Semiconductor Production Equipment
Japan
U.S.
EuropeKorea
TaiwanChina
S.E.Asia
FPD/PV Production Equipment
Electronic Components & Computer Networks
OthersOperating Income(loss)
Ordinary Income(loss)
Net Income(loss)
Note:

1Q

2Q

3Q

Total

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

132,421
105,963
10,18629,152
12,944
14,46329,456
6,196
3,563
4,460
21,859
137
2,918
4,211
370

91,91068,056
6,349
28,8797,673
5,759
15,238
2,153
2,003
4,682
19,10566(6,865)(6,654)(7,026)

358,511282,723
26,56884,661
31,07544,43674,03314,016
7,930
13,912
61,570
305
5,336
8,805
(936)

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

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TOKYO ELECTRON

Production and Order Performance
1. Production（ Millions of yen）
FY2013
1Q
96,681
2,121
98,803

Semiconductor Production Equipment
FPD/PV Production Equipment
Total
Note:

2Q
88,2944,511
92,806

3Q
68,894
3,030
71,924

Total
253,870
9,663
263,534

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

2. Orders Received（ Millions of yen）
FY2013
1Q
76,0292,829
22,631
101
101,590

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

2Q
66,928
8,085
20,658137
95,8103Q
91,324
3,673
18,54866
113,612

Total
234,282
14,58861,838305
311,014

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）
FY2013
1Q
157,737
12,26015,809185,807

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

2Q
118,702
15,885
14,608149,1963Q
142,654
23,29814,051
180,004

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 consolidated fiscal year were 508,700 million
yen, down 98,350 million yen compared to the end of the previous fiscal year. The major factors influencing

5TOKYO ELECTRON

this result were a 69,818 million yen decrease in trade notes and accounts receivable and a 26,790 million
yen decrease in short-term investments included in securities.
Tangible fixed assets increased by 7,883 million yen from the end of the previous fiscal year, to 134,768
million yen.
Intangible fixed assets increased by 55,691 million yen from the end of the previous fiscal year, to 60,395
million yen as a result of a 54,169 million yen increase in goodwill and other factors.
Investments and other assets increased by 4,763 million yen from the end of the previous fiscal year, to49,735 million yen.
As a result, total assets decreased by 30,011 million yen compared to the end of the previous fiscal year, to753,598 million yen.
Current liabilities were down 26,297 million yen compared to the end of the previous fiscal year, to 98,496
million yen. The major factors causing the decline were a 15,931 million yen decrease in trade notes andaccounts payable and a 9,135 million yen decrease in customer advances.
Long-term liabilities were up 2,558 million yen compared to the end of the previous fiscal year, to 62,772
million yen.
Net assets were 592,330 million yen, down 6,272 million yen from the end of the previous fiscal year. The
main factors were a net loss of 936 million yen reported for the first three quarters, payment of 4,837 million
yen in year-end dividends for the previous fiscal year and 4,479 million yen in interim dividends for thecurrent fiscal year, and an increase of 4,501 million yen from translation adjustments due to effects from thedepreciation of the yen. The equity ratio was 77.0%.

(ii) Cash Flow
Cash and cash equivalents at the end of the third quarter of the current consolidated fiscal year decreased
by 93,433 million yen compared to the end of the previous fiscal year, to 65,342 million yen. The combined
balance including the 168,848 million yen in time deposits and short-term investments with periods tomaturity or redemption of at least three months that are not included in cash and cash equivalents, was234,191 million yen, down 13,433 million yen from the end of the previous fiscal year. 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 increased by 49,888 million yen compared to the same period of theprevious year to 71,632 million yen. The main positive factors included 9,349 million yen in income before
income taxes, a 75,982 million yen decrease in trade notes and accounts receivable, and an 18,426 million
yen in depreciation and amortization. The main negative factors were a 20,271 million yen decrease inaccounts payable and a 13,835 million yen decrease in customer advances.
Cash flow from investing activities was negative 150,415 million yen, compared to the negative 19,176
million yen in the same period of the previous year. This was primarily the result of 80,000 million yen
increase in time deposits and short-term investments, 55,068 million yen in purchase of investments in

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TOKYO ELECTRON

subsidiaries resulting in changes in scope of consolidation, and 15,581 million yen in payment for purchaseof tangible fixed assets.
Cash flow from financing activities was negative 11,382 million yen, primarily as a result of the payment of
9,316 million yen in dividends. Cash flow from financing activities in the previous fiscal year was negative
24,464 million yen.

Consolidated Cash Flow (Summary)Nine months ended
December 31, 2011

（ Millions of yen）
Nine months ended
December 31, 2012

21,74445,97917,014
5,649
1,539(8,457)(39,981)(19,176)
12,000(31,176)(24,464)(1,730)71,632
9,349
18,42675,982
6,857(20,271)(18,713)(150,415)(80,000)(55,068)(15,346)(11,382)(3,268)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
Net increase in cash and cash equivalents (decrease)(23,626)(93,433)

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

165,050
141,423

158,776
65,342

Cash and cash equivalents and time deposits and short-term investments with periods tomaturity or redemption of at least three months that are not included in cash and cash
equivalents

249,414

234,191

3. Qualitative Information on Forecasts for Consolidated Financial Results

With regard to net sales, the prior forecast for the core semiconductor production equipment businessremains unchanged, but the forecast for the electronic components and computer networks business(handled by Tokyo Electron Device Ltd., a consolidated subsidiary) has been revised downward, making foran overall net sales forecast lower than the previous one. With respect to income, we have implemented
thorough cost-cutting efforts in response to the severe business environment, but due to a lower production
forecast in the manufacturing subsidiaries of the semiconductor production equipment business than theprevious forecast, a relative fixed-cost-burden rise against production cost is anticipated. As a result of that
effect and the lower net sales as described above, we expect both operating income and net income figures
to fall below the levels seen in the previous announcement. The current business forecasts also reflect theeffects of a higher tax burden stemming from changes in the performance of consolidated subsidiaries.
Consequently we have revised the consolidated financial forecast for the year ending March 31, 2013
announced on October 31, 2012.

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TOKYO ELECTRON

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

495.0-21.8%

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

393.0
19.0
82.5
0.5
9.5
4.5

-17.8%-72.8%-2.8%
8.4%-84.3%-87.7%

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 by the TEL Group 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. The company does notpromise that the forecasts or estimates will be accurate.
They are therefore susceptible to the impact of many uncertainties, including market conditions, competition, the launching of
new products (and their success or failure), and global conditions in the semiconductor related industry. Consequently, actual
sales and profits may differ substantially from the projections stated in this financial review.

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TOKYO ELECTRON

Consolidated Balance Sheet(Millions of yen)
As ofDecember 31, 2012

As ofMarch 31, 2012ASSETS
Current assets
Cash and deposit

35,83449,191

150,305

80,487

Securities

211,790

185,000

Merchandise and finished goods

101,789

97,391Work in process

35,10435,252

Raw materials and supplies

12,575

14,650

Others61,02647,503

Trade notes and accounts receivable

Allowance for doubtful accounts
Total current assets(1,376)(775)

607,050

508,700

126,885

134,768

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

4,703
4,703

54,1696,225
60,395

48,819(3,848)44,971
176,560
783,61053,472(3,737)49,735244,898
753,598

TOKYO ELECTRON

Consolidated Balance Sheet
As ofMarch 31, 2012

(Millions of yen)
As ofDecember 31, 2012

LIABILITIESCurrent liabilities
Trade notes and accounts payable

46,986

31,055

Accrued warranty expenses

8,903

8,482

Other allowance

9,077

3,532

Others59,82655,426

Total current liabilities

124,794

98,49654,64656,032

619

567

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

4,947

6,171

Total long-term liabilities

60,21362,772

185,007161,268

54,961
78,023471,186(9,747)594,42254,961
78,023
460,911(9,611)
584,283

3,575(51)(11,157)(7,633)
1,156
10,656598,602

2,927(79)(6,656)(3,808)
1,298
10,556592,330

783,610753,598

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

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TOKYO ELECTRON

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

Nine months ended
December 31, 2012

Net sales

455,514358,511

Cost of sales

300,532

244,622

Gross profit

154,981

113,889

59,87254,859Selling, general & administrative expenses
Research and development expenses
Others52,15553,692

Total selling, general & administrative expenses

112,027

108,552

42,953

5,336

535

1,022

Operating income
Non-operating income
Revenue from development grants
Foreign currency translation gain

1,089

-

Others

2,426

2,924

Total non-operating income

4,052

3,947

Non-operating expenses
Foreign currency translation loss-

227

Others285

251

Total non-operating expenses

285

478

46,720

8,805

13

930

1,437

-

Ordinary income
Unusual or infrequent profit
Gain on sale of fixed assets
Gain on collection written-off claims
Others

171

-

1,622

930

Loss on sale or disposal of fixed assets

225

91

Loss from earthquake damage

938-

Loss on liquidation of subsidiaries and affiliates-

133

Reorganization costs-

132

Total unusual or infrequent profit
Unusual or infrequent loss

Others

1,199

29

Total unusual or infrequent loss

2,363

386

Income before income taxes

45,979

9,349

Provision for income taxes and enterprise taxes

18,252

7,916

-

2,194

Prior year’s corporate tax
Income (loss) before minority interests

27,726(760)

Minority interests

313

175

Net income (loss)

27,412(936)

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Consolidated Statement of Comprehensive Income

TOKYO ELECTRON

Nine months ended
December 31, 2011

(Millions of yen)
Nine months ended
December 31, 2012

27,726(760)(1,249)

(643)

6

(34)

Translation adjustments(4,923)

4,539

Total other comprehensive income(6,167)

3,860

21,5593,099

21,275

2,888

283

211

Income (loss) before minority interests
Other comprehensive income
Valuation difference on available-for-sale securities
Deferred gains or losses on hedges

Comprehensive income(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
Nine months ended December 31, 2012

(Millions of yen)
Reportable Segment

Semiconductor
Production
Equipment

FPD/PV Production
Equipment

Electronic
Components &Computer Networks

Others

Net sales

282,751

13,912

62,145

8,399

Segment income(loss)

33,626(5,389)

861

1,007

Total Segment

Eliminations

Consolidated Total

Net sales

367,209(8,698)358,511

Segment income(loss)

30,105(20,755)

9,349

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 or loss amounting to 20,755 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 15,156 million yen, pertaining to fundamental
research and element research conducted by the company not related to any of the reportable segments.
3. Segment income or loss 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 third quarter, TEL acquired all the shares of U.S.-based FSI International, Inc., Irelandbased Magnetic Solutions Inc. and Switzerland-based Oerlikon Solar Holding AG that became
consolidated subsidiaries. As a result of these transactions, 13,761 million yen in goodwill arose in
the semiconductor production equipment segment, and 21,786 million yen in goodwill arose in the
FPD/PV Production Equipment segment. As the allocation of the goodwill amount to theacquisition value is not complete, this is a provisional calculation of the amount.
Significant income related to negative goodwill: None14