Translation

Member of the Financial Accounting Standards Foundation

October 13, 2011

Consolidated Financial Results for the Three Months Ended August 31, 2011
[Japanese GAAP]
Toyo Tanso Co., Ltd.
Tokyo Stock Exchange, 1st Section
5310
Osaka, Japan
http://www.toyotanso.co.jp
Naotaka Kondo, President
Toshimi Boki, Executive Officer, General Manager,
Finance and Accounting Department
81-6-6451-2114 (from overseas)

Listed company name:
Stock exchange listing:Stock code:
Location of headquarters:
Website:Representative:
Contact:
TEL:
Scheduled date for submissionof quarterly report:
Scheduled date for dividend payment:
Supplementary materials for quarterly
financial summaries:
Quarterly financial results briefing:

October 14, 2011
NoNo

1. Consolidated financial results for the three months ended August 31, 2011
(From June 1, 2011 to August 31, 2011)(1) Operating results (cumulative total)(Millions of yen, rounded down)(Percentages indicate changes from the same period in the previous fiscal year.)Net sales

Operating profit

Recurring profit%%

Three months ended
10,97621.2
August 31, 2011
Three months ended
9,054
51.3
August 31, 2010
Note:
Comprehensive income:Three months ended August 31, 2011
Three months ended August 31, 2010
Net income per share

Three months ended
August 31, 2011
Three months ended
August 31, 2010

Net income
%

%

2,583

56.0

2,493

74.8

1,712

59.5

1,656

244.0

1,426

231.8

1,073

611.2

1,573 million yen (up 160.4 %)604 million yen (-%)

Diluted net income
per share

yen

yen

82.60

-

51.78

-

(2) Financial position(Millions of yen, rounded down)
Total assets

EquityEquity ratio%

As of August 31, 2011

64,92452,86979.3

As of May 31, 2011

65,191

51,74877.5

Reference: Shareholders’ equity
August 31, 2011
May 31, 2011

51,506 million yen
50,510 million yen

2. Dividends
Dividends per share (yen)Second quarter
end

First quarter end-

Year-end

Third quarter end--(Actual)Year ending May 31, 2012
(Forecast)(Note) Revisions of projected dividends most recently announced: None-

Year ended May 31, 2011
Year ending May 31, 2012

Total (Full year)

22.00

22.00
-

-

25.00

25.00

3. Consolidated results forecast for the fiscal year ending May 31, 2012
(From June 1, 2011 to May 31, 2012)(Millions of yen, rounded down)(Percentages indicate changes from the same period in the previous fiscal year.)
Net income
Operating profit
Recurring profit
Net income
per share

Net sales
%

%

%

%

yen

Interim period(cumulative)

21,000

14.0

4,000

32.5

4,000

43.0

2,500

30.4

120.57Full year

40,000

6.5

6,300

7.4

6,300

12.2

4,000

8.1

192.92(Note) Revisions of consolidated forecasts most recently announced: Yes
The consolidated forecasts for the second quarter (cumulative) and for the full financial year have been revised on October 13, 2011.
For details, please refer to the “Notice Concerning the Revision of Consolidated Forecast,” issued on October 13, 2011.

4. Others(1) Changes in significant subsidiaries during the quarter under review: None
(Changes in specified subsidiaries accompanying changes in scope of consolidation)
New subsidiaries: ___ (name of company(ies))
Excluded subsidiaries: ___ (name of company(ies))(2) Adoption of specific accounting methods for the preparation of quarterly consolidated financial
statements: Yes(Note) For details, please refer to “Adoption of specific accounting methods for the preparation ofquarterly consolidated financial statements” on Page 3 (attached materials)(3) Changes in accounting policies and accounting estimates and restatements
1) Changes in accounting policies due to revisions of accounting standards, etc.: Yes
2) Changes in accounting policies other than 1): None
3) Changes in accounting estimates: None
4) Restatements: None
(Note) For details, please refer to “Adoption of specific accounting methods for the preparation ofquarterly consolidated financial statements” on Page 3 (attached materials)(4) Number of shares outstanding (common stock)i. Number of shares outstanding and issued at the end of period (including treasury stock)
As of August 31, 2011
20,750,688 shares
As of May 31, 2011
20,750,688 shares
ii. Number of treasury stock at the end of period
As of August 31, 201116,265 shares
As of May 31, 201116,265 sharesiii. Average number of shares during the period (quarterly cumulative total)
First quarter ended August 31, 2011
20,734,423 sharesFirst quarter ended August 31, 2010
20,734,473 shares* Implementation status of quarterly review proceduresThis quarterly financial results report is not subject to the quarterly review procedures stipulated by the
Financial Instruments and Exchange Act. The review of quarterly consolidated financial statements has
been completed at the time of release of this report.
* Disclaimer regarding appropriate use of forecasts and related points of note
The forecasts and forward-looking statements contained in this report are based on information currently
available and on certain assumptions deemed rational as of the date of release. Accordingly, actual results
may differ significantly from these forecasts due to various factors. For more information on thepreconditions of the forecasts and on precautionary notes concerning the usage of these forecasts, pleaserefer to “Qualitative Information Regarding Consolidated Results Forecast” on page 3 of the Attached
Documents.

○Attached Documents
1. Qualitative Information Regarding Consolidated Results for the Quarter under Review··············· 2(1) Qualitative Information Regarding Consolidated Operating Results ··········································· 2(2) Qualitative Information Regarding Consolidated Financial Position············································ 2(3) Qualitative Information Regarding Consolidated Results Forecast ·············································· 3
2. Items regarding summary information (Others) ··················································································· 3(1) Changes in significant subsidiaries during the quarter period under review ······························· 3(2) Adoption of specific accounting methods for the preparation of quarterly
consolidated financial statements········································································································ 3(3) Changes in accounting policies and accounting estimates and restatements ································ 3
3. Key event regarding the premise of a going concern············································································· 3

4. Quarterly Consolidated Financial Statements········································································· 4(1) Quarterly consolidated balance sheets ······························································································· 4(2) Quarterly consolidated statement of income and quarterly consolidated
statement of comprehensive income ··································································································· 6
Quarterly consolidated statements of income ··················································································· 6
Quarterly consolidated statement of comprehensive income ·························································· 7(3) Notes regarding the premise of a going concern ··············································································· 8(4) Segment information ···························································································································· 8(5) Notes if the amount of shareholders’ equity has changed significantly·········································· 9
5. Supplementary Information···································································································· 10(1) Orders and sales by product category······························································································ 10(2) Overview ···············································································································································1111. Qualitative Information Regarding Consolidated Results for the Quarter under Review(1) Qualitative Information Regarding Consolidated Operating Results
During the first quarter under review, the global economy on the whole gradually continued on its road torecovery, buttressed by economic growth in Asia and other emerging countries. Despite concerns over the
direct and indirect impact of the Great East Japan Earthquake disaster, the Japanese economy also turned
upward, thanks to the gradual restoration of supply chains. However, concerns over an economic downturn
both in Japan and abroad are arising owing to such factors as anxiety over financial instability, thedeterioration in employment conditions in Europe and the United States, and, regarding Japan, a further
appreciation of the yen.
Amid these circumstances, the Toyo Tanso Group concentrated its efforts on improving and expanding its
earnings by trying to actively absorb sharply increasing demand mainly in the environment- andenergy-related sectors and increasing sales prices, such as through the shift to high value-added goods.
As a result, the Group’s business performance improved during the first quarter under review, despite theimpact of the rising yen or the heavy burden of depreciation expenses. Net sales totaled 10,976 million yen(up 21.2% from the same term in the previous year), operating profit 2,583 million yen (up 56.0%), andrecurring profit 2,493 million yen (up 74.8%). Net income for the quarter was 1,712 million yen (up 59.5%).
The overall performance of each business segment was as follows. (Please refer to “Supplementary
Information” for an overview of each product category.)Japan
Despite some impact from the earthquake disaster, our earnings in Japan on the whole expanded,
underpinned by the gradual progress of reconstruction efforts and our absorption of reconstruction-related
demand thanks to the economic upturn. As a result, net sales for the quarter in Japan were 5,301 million yen(up 6.1%) and operating profit was 1,268 million yen (up 48.1%).
United States
Business performance in the United States was sluggish due partly to the stronger yen, despite thecontinued recovery trend mainly of products for semiconductor and solar cell applications. As a result, sales
totaled 744 million yen (down 1.0%) while operating profit came to 31 million yen (compared with a loss of
13 million yen in the same term last year).
EuropeSales of chiefly solar cell-, industrial furnace- and brush-related products fared better than expected,
boosted by the upturn in the European economy. As a result, net sales for the quarter in Europe were 804
million yen (up 16.7 %) and operating profit was 132 million yen (up 63.6%).
Asia
Earnings in Asia overall were extremely brisk, spurred by the upsurge in sales of products formetallurgical and other general industrial-related applications as well as solar cell-related products due to thevibrant economies in China and other emerging countries. As a result, net sales for the quarter in Asia were
4,125 million yen (up 57.7 %) and operating profit was 1,110 million yen (up 95.4 %).
(2) Qualitative Information Regarding Consolidated Financial Position
Total assets as of August 31, 2011 decreased by 267 million yen from the end of the previous consolidated
fiscal year. This decline is mainly attributable to the 1,492 million yen decline in cash on hand and in banks
resulting from the payment of income taxes, etc. and the 191 million yen decrease in tangible fixed assets
due mainly to the posting of depreciation expenses, etc. These declines eclipsed the 791 million yen increasein trade notes and accounts receivable primarily from higher sales and the 646 million yen rise in inventories
through the systematic accumulation of intermediate stock, etc.
Total liabilities decreased by 1,387 million yen from the end of the previous consolidated fiscal year. Thiswas mainly caused by a decrease of 691 million yen in income tax payable, etc. and 486 million yen ininterest-bearing debt, etc. This exceeded the increase of 391 million yen in trade notes and accounts payable
owing mainly to a rise in the procurement of raw materials, etc.
Total equity increased by 1,120 million yen from the end of the previous consolidated fiscal year. This net
2increase chiefly stemmed from such factors as an increase of 1,256 million yen in retained earnings.
(3) Qualitative Information Regarding Consolidated Results Forecast
Regarding domestic and overseas economic conditions going forward, we expect the global economy toremain on a mild recovery path. However, the future is unpredictable given burgeoning concerns over a
global economic downturn along with the emergence of risk factors such as issues regarding the exchange
rate, employment situation and apprehensions over fiscal conditions.
Although the current demand for our products remains firm primarily in the environment- andenergy-related fields in the Asian region, uncertainties regarding the future conditions surrounding ourbusiness group are increasing given such factors as the continued strength of the yen and concerns over the
downtrend in sales in the solar cell, LED and other markets. We will continue to try to expand sales whileassessing market trends and push forward our efforts to shift to high value-added and high-margin products.
Based on the abovementioned situation and the fact that our performance during the first quarter underreview has exceeded projections, we have revised the consolidated results forecast for the first half of the
fiscal year that were announced on July 15, 2011, to net sales of 21 billion yen, an operating profit of 4
billion yen, a recurring profit of 4 billion yen, and a net income of 2.5 billion yen. We have also revised our
results forecast for the full fiscal year. (Assumed exchange rate from the second quarter ending November 30,
2011: 75 yen/US$, 100 yen/EUR, 11.4 yen/CNY)
2. Items regarding summary information (Others)(1) Changes in significant subsidiaries during the quarter period under review
None(2) Adoption of specific accounting methods for the preparation of quarterly consolidated financial
statements
Tax expense calculation
Tax expenses are calculated by multiplying profit before income taxes by an effective tax rate,
which is reasonably estimated by applying tax effect accounting to estimated profit before income
taxes for the fiscal year including the first quarter under review.
The income taxes-deferred is included in income taxes.
(3)

Changes in accounting policies and accounting estimates and restatements
Changes in accounting policies
Adoption of the Accounting Standard for Earnings Per Share and others
From the first quarter of the fiscal year under review, the Company has applied the “AccountingStandard for Earnings Per Share” (Accounting Standards Board of Japan (ASBJ) Statement No.2,
June 30, 2010); and the “Guidance on Accounting Standard for Earnings Per Share” (ASBJ Guidance
No.4, June 30, 2010).
The Company has changed the method by which it calculates quarterly diluted earnings per share
as follows. For stock options that vest after a specified service period, the Company now includes the
portion of stock options’ fair value attributable to future services provided to our company whencalculating the cash proceeds assumed to be receivable upon exercise of the stock options.
However, this revision does not have any impact on quarterly diluted earnings per share.

3. Key event regarding the premise of a going concern
None3

4. Quarterly Consolidated Financial Statements(1) Quarterly consolidated balance sheets
Previous consolidated fiscal
year
As of May 31, 2011
AmountAssetsCurrent assets
Cash on hand and in banks
Trade notes and accounts receivable
Merchandise and finished goods
Work in process
Raw materials and stores
Other
Allowance for doubtful accounts
Total current assets
Fixed assets.
Tangible fixed assets
Buildings and structures (Net)
Machinery, equipment, and vehicles (Net)Land
Construction in progress
Other (Net)
Total tangible fixed assets
Intangible fixed assets
Investments and other assets
Total fixed assets
Total assets

4(Thousands of yen, rounded down)First quarterly consolidated
fiscal year
As of August 31, 2011
Amount

9,283,891
13,047,069
4,761,418
6,182,218
1,511,288
1,591,422(111,741)
36,265,565

7,791,176
13,838,713
5,240,682
6,218,405
1,642,658
1,501,768(99,475)
36,133,930

7,373,417
12,096,129
5,296,473
655,395
740,800
26,162,216
785,261
1,978,597
28,926,075
65,191,641

7,186,664
11,619,800
5,290,396
1,109,357
764,073
25,970,293
789,7132,030,497
28,790,503
64,924,433

Previous consolidated
fiscal year
As of May 31, 2011
AmountLiabilities
Current liabilities
Trade notes and accounts payable
Short-term borrowings
Accrued amount payable
Income taxes payable
Reserve for employees’ bonuses
Reserve for directors’ and corporate auditors’
bonuses
Other
Total current liabilities
Long-term liabilities
Long-term borrowings
Reserve for employees’ retirement benefits
Asset retirement obligations
Other
Total long-term liabilities
Total liabilities
EquityShareholders’ equity
Common stock
Capital surplus
Retained earnings
Treasury stock - at cost
Total shareholders’ equity
Accumulated other comprehensive income
Unrealized gains (losses) on available-for-sale securities
Foreign currency translation adjustments
Total accumulated other comprehensive income
Share warrants
Minority interests
Total equity
Total liabilities and equity

5(Thousands of yen, rounded down)First quarterly consolidated
fiscal year
As of August 31, 2011
Amount2,950,193
1,406,013
2,538,873
1,495,600
825,271

3,341,391
1,070,769
2,544,472
803,865
480,718

78,480-1,788,486
11,082,920

1,614,644
9,855,862

665,014
658,878
278,121758,3422,360,356
13,443,276

513,885
648,490269,222
767,870
2,199,469
12,055,331

7,692,575
9,534,686
35,169,221(57,630)
52,338,853

7,692,575
9,534,686
36,425,777(57,630)
53,595,408

2,941(1,831,083)(1,828,141)
20,0881,217,565
51,748,364
65,191,641

10,672(2,100,010)(2,089,338)
23,436
1,339,595
52,869,101
64,924,433

(2) Quarterly consolidated statement of income and quarterly consolidated statement of comprehensive income(Quarterly consolidated statements of income)Three months ended August 31, 2011
(Thousands of yen, rounded down)
Three months ended
August 31, 2010
Amount
9,054,523
5,932,104
3,122,418
1,465,846
1,656,572

Three months ended
August 31, 2011
Amount10,976,093
6,888,301
4,087,792
1,503,935
2,583,856

6,336
5,184
47,361
12,986
71,8688,819
4,790
97,337
15,885
126,833

12,478259,490
27,4482,359
301,777
1,426,664

8,153
198,429
4,561
6,146
217,291
2,493,398-

67,05067,050

8,024

748
4,818

216,240-

224,265

5,566

Profit before income taxes

1,202,399

2,554,882

Income taxes
Income before minority interests
Minority interests
Net income

43,1591,159,239
85,621
1,073,617

703,582
1,851,300
138,588
1,712,712

Net sales
Cost of goods sold
Gross profit
Selling, general and administrative expenses
Operating profit
Non-operating income
Interest income
Dividends earned
Gain on foreign currency option
Other
Total non-operating income
Non-operating expenses
Interest expenses
Foreign exchange losses
Valuation loss on investment securities
Other
Total non-operating expenses
Recurring profit
Extraordinary profit
Gain on sale of fixed assets
Total extraordinary profit
Extraordinary losses
Loss on sale of fixed assets
Loss on disposal of fixed assets
Effect of application of the Accounting Standard for Asset
Retirement Obligations
Total extraordinary losses

6

(Quarterly consolidated statement of comprehensive income)Three months ended August 31, 2011
(Thousands of yen, rounded down)
Three months ended
August 31, 2010
AmountIncome before minority interests
Other comprehensive income
Unrealized gains (losses) on available-for-salesecurities
Foreign currency translation adjustments
Total other comprehensive income
Comprehensive income(Breakdown)Comprehensive income attributable to parent company
shareholders
Comprehensive income attributable to minority interests

7

Three months ended
August 31, 2011
Amount1,159,239

1,851,300

(421)

7,730

(554,458)(554,880)
604,359(285,485)(277,754)
1,573,546(576,996)(27,362)

1,451,515
122,030

(3) Notes regarding the premise of a going concern
Not applicable.

(4) Segment information
I. Three months ended August 31, 2010 (From June 1, 2010 to August 31, 2010)
1. Information on net sales and the amount of profits and losses per reportable segment(Thousands of yen, rounded down)Amountrecorded intheconsolidated
quarterly
incomestatement(Note) 2

Reportable segments

Japan

UnitedStatesEurope

Asia

Total

Adjusted
amount(Note) 1

Sales(1) Sales to unaffiliated customers

4,997,438

751,703689,585

2,615,796

9,054,523-

9,054,523(2) Intersegment sales or transfers

1,624,433

17,947

10,722

31,356

1,684,460(1,684,460)

-

Total

6,621,872

769,651

700,308

2,647,152

10,738,984(1,684,460)

9,054,523

Segment profit (loss)

856,570(13,050)

81,117568,473

1,493,110

163,461

1,656,572(Notes) 1. Adjusted segment profit (loss) mainly takes into account the elimination of inter-segment transactions and unrealized
income.
2. Segment profit (loss) has been adjusted to reflect the operating profit recorded in the consolidated quarterly statement ofincome.

2. Regional information(Thousands of yen, rounded down)
Asia
Japan

Sales
Composition (%)

North
America

Europe3,718,791

711,100

801,948

Asia(including
China)
3,768,757

41.1

7.8

8.9

41.6

Rest of
world

Total

China only
2,466,739

53,925

9,054,523

27.2

0.6

100.0

(Notes) 1. Sales are based on the locations of our customers, and are categorized into the relevant country or region segment
according to geographical proximity.
2. The major countries or regions included in each geographic segment (except Japan) are listed below.
(1) North America: United States(2) Europe: France, Germany, Italy(3) Asia: China, Taiwan, South Korea

8II. First quarter under review (from June 1, 2011 to August 31, 2011)
1. Information on net sales and the amount of profits and losses per reportable segment(Thousands of yen, rounded down)Amountrecorded intheconsolidated
quarterly
incomestatement(Note) 2

Reportable segments

Japan

UnitedStatesEurope

Asia

Total

Adjusted
amount(Note) 1

Sales(1) Sales to unaffiliated customers

5,301,076

744,218

804,949

4,125,849

10,976,093-

10,976,093(2) Intersegment sales or transfers

2,434,864

110,814489

19,6302,565,798(2,565,798)-

7,735,940

855,032

805,439

4,145,479

13,541,892(2,565,798)

10,976,093

1,268,915

31,966132,671

1,110,586

2,544,140

39,716

2,583,856

Total
Segment profit(Notes) 1. Adjusted segment profit mainly takes into account the elimination of inter-segment transactions and unrealized income.
2. Segment profit has been adjusted to reflect the operating profit recorded in the consolidated quarterly statement ofincome.

2. Regional information(Thousands of yen, rounded down)
Asia
Japan

Sales
Composition (%)

North
America

Europe4,009,861

729,865922,739

Asia(including
China)
5,269,856

36.5

6.7

8.4

48.0

Rest of
world

Total

China only
3,984,786

43,77010,976,093

36.3

0.4

100.0

(Notes) 1. Sales are based on the locations of our customers, and are categorized into the relevant country or region segment
according to geographical proximity.
2. The major countries or regions included in each geographic segment (except Japan) are listed below.
(1) North America: United States(2) Europe: France, Germany, Italy(3) Asia: China, Taiwan, South Korea(5) Notes if the amount of shareholders’ equity has changed significantly
Not applicable.

95. Supplementary Information(1) Orders and sales by product categoryi.

Orders

Products
Special graphite products
Carbon products for general industries(for mechanical applications)
Carbon products for general industries(for electrical applications)Compound materials and other products
Total

1Q
4,900

(Unit: millions of yen)
Year ending
Year ended May 31, 2011
May 31, 2012
Fiscal year
2Q
3Q
4Q
1Q
total
4,413
5,285
6,158
20,758
6,154

628

686

699

841

2,856

860

1,190

1,003

1,217

967

4,379

1,085

2,462
9,182

2,093
8,197

2,144
9,347

2,549
10,516

9,249
37,243

2,121
10,221

ii. Outstanding orders
Year ended May 31, 2011
Products
Special graphite products
Carbon products for general industries(for mechanical applications)
Carbon products for general industries(for electrical applications)Compound materials and other products
Total(Unit: millions of yen)
Year ending
May 31, 2012
4Q
1Q
4,787
4,956

1Q
3,336

2Q
3,328

3Q
3,834

418

464

512

648

748

679

648

947

1,030

1,128

4,406
8,840

3,865
8,307

3,799
9,094

3,930
10,397

3,508
10,342iii. Sales performance by product category

4,551(Unit: millions of yen)
Year ending
Year ended May 31, 2011
May 31, 2012
Fiscal year
2Q
3Q
4Q
1Q
total
4,681
5,031
5,598
19,863
5,972[Electronics applications]

2,611

2,630

2,983

3,506

11,731

3,649[General industries applications]

1,737

1,844

1,810

1,846

7,238

2,035

[Others]
Carbon products for general industries(for mechanical applications)
Carbon products for general industries(for electrical applications)Compound materials and other products[3 major products][Other products]
Related goods
Total

203

206

237

245

893

287

625

678

684

741

2,728

793

1,128

1,063

955

935

4,082

1,012

2,423
2,124
298
325
9,054

2,648
2,257
391
287
9,358

2,234
1,838
395
270
9,175

2,427
2,070
357
265
9,968

9,734
8,290
1,443
1,149
37,557

2,961
2,600
361
235
10,976

Products
Special graphite products

1Q

10(2) Overview
Special graphite products
As a whole, demand for electronics applications remained firm, thanks to sharply increased sales of
special graphite products for the manufacture of solar cells primarily in China and Korea propelled by thegrowing trend toward environmentally friendly and energy-saving products. Demand was also boosted bysuch factors as the upturn in orders for products for the manufacture of single crystal silicon stemmingfrom the waning impact of the Great East Japan Earthquake disaster.
Demand for special graphite products for general industries applications remained strong on the whole,primarily due to the increase in domestic and overseas demand for industrial furnaces and metallurgicalapplications, in line with the domestic economic recovery and economic expansion of emerging countries.
Carbon products for general industries
Sales of carbon products for mechanical applications expanded, thanks largely to increased demand forsuch products as bearings and seals partly bolstered by the economic upturn as well as our progress inmeeting reconstruction-related demand.
Among carbon products for electrical applications, sales of products for small motors intended for
vacuum cleaners and electric power tools leveled off owing to intensified competition mainly in China,
our core market, and the effect of the stronger yen.
Compound materials and other products
Orders for SiC (silicon carbide)-coated graphite products leveled off as a whole, mainly because they
are still undergoing an adjustment phase despite an upturn in demand for LED-related products, whichwere forced to undergo a correction in reaction to the steep growth in such demand. Orders for C/Ccomposite products remained strong on the whole as a result of the steady increase in demand for products
for the manufacture of single crystal silicon as well as the rise in demand for products for the manufactureof solar cells and industrial furnaces particularly in overseas markets. Orders for graphite sheet products
remained brisk, bolstered by firm demand for products for the manufacture of semiconductors and solar
cells in addition to the recovery in demand for products for automotive applications.

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