TOYO TANSO
Results for the Fiscal Year Ended May 31, 2009

July2009
２００９年７月
Toyo Tanso Co., Ltd.
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Table of Contents

1-1. Business Results
1-2. Results for the Fiscal Year Ended May 31, 2009
1-3. Factors Affecting Changes in Recurring Profit
1-4. Overview of Operations by Product and Segment
1-5. Overview of Net Sales by Region
2-1. Earnings Forecast for the Fiscal Year Ending May 31, 2010
2-2. Future Investment (Capital Investment, Depreciation Cost, R&D Cost)
2-3. Return of Profits to Shareholders
2-4. Key Performance Indicator Trends
3-1. Topics - Participation in Exhibitions Worldwide (Reference 1) Balance Sheet for the Fiscal Year Ended May 31, 2009
(Reference 2) Statement of Cash Flows for the Fiscal Year Ended May 31, 2009

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P. 3
P. 4
P. 5
P. 6
P. 9
P.10
P.11
P.12
P.13
P.14
P.15
P.16

2

1-1. Business Results(Unit: Yen, millions)

Net sales
Recurring profit

40,00012,00034,53135,00031,38130,97430,00028,00025,49225,00010,000

7,795

23,003

8,000

7,123

20,0006,000
4,96115,000

3,724

4,483

14,866
4,100

12,227

10,000

3,369
2,280

5,000

17,97917,372

4,000
3,754

(2Q cumulative)

12,0002,500(2Q cumulative)(2Q cumulative)(2Q cumulative)

2,000(2Q cumulative)

300

0

05/5

06/5

07/5

08/5

09/5

10/5

0

(Forecast)
Copyright © Toyo Tanso Co., Ltd. All Rights Reserved31-2. Results for the Fiscal Year Ended May 31, 2009

(Unit: Yen, millions)

Change inyen%
increase

30,974(3,556)(10.3%)

4,741(3,290)(41.0%)(3,312)(42.5%)

08/5

09/5

Net sales34,531

Operatingprofit8,031

Ratio of operating
profit to net sales

RecurringprofitRatio of recurring
profit to net sales

23.3%
7,795
22.6%

Positive results continued until thefirst half of the year, but conditions
deteriorated suddenly from thesecond half of the year onwards.
The impact of rapid and large-scale
production and inventory
adjustments across almost all
purposes, industries and regions,
including the field ofsemiconductors and Chinese solar
cells which had previously led
growth, led to a fall in sales ofalmost 30% in the second half ofthe year compared to the first halfof the year.

In addition to a drop in marginal
profit as a result of falling sales andproduction caused by slumping
demand, profit margins also fell asa result of rising raw materials
prices, increased depreciation costs(+530 million yen) and the impactof a stronger yen. However,deposits from the first half of theyear helped to secure a double digit
profit ratio.

15.3%
4,483
14.5%

Profit before
income taxes

8,162

4,615

(3,546)(43.5%)Net income

5,143

2,566

(2,576)(50.1%)Net income
per share

247.33 yen

123.80 yen

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Points4

1-3. Factors Affecting Changes in Recurring Profit(Unit: Yen, millions)（単位：百万円）

8,000

7,795

417
Change inraw materials
prices

7,000
6,000
5,000
08/5

3,000

Recurringprofit

2,000
1,000

Change indepreciation
costs

340
Impact ofexchange
rates

258
Product
structuredifferences
and pricerevisions

1,037
Change insales volumes

824

99

Streamlining Difference inand difference other costs
in operating
rates

4,483
09/5

Recurringprofit

4,000

5350
Copyright © Toyo Tanso Co., Ltd. All Rights Reserved51-4. Overview of Operations by Product and Segment(1) Net Sales(Unit: Yen, millions)(09/5 results in comparison
with previous year)

34,53135,00031,381

8,098

30,00030,974

4,804

4,364

20,00013,807

15,00010,0005,000

12,837

1,837
1,978
3,248

438
05/5
05/5月期

15,916

1,776
2,086

8,100

7,783
1,871

2,682
4,257

16,184

6,460

1,769
2,991
4,598

1,008
2,735
4,081

5,524

5,261
525
06/5
06/5月期

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Special Graphite Products[Others](-43.0%)Carbon Products for GeneralIndustries[Carbon Productsfor Mechanical Applications](-8.5%)

Carbon Products for GeneralIndustries[Carbon Productsfor Electrical Applications](-11.2%)Compound Materials andOther Products[Three Major Products](-8.0%)

Compound Materials andOther Products[Other products](-7.8%)

Related goods(-35.4%)

15,288

6,099
1,002
2,414
3,774

3,811
6,454

5,939

7,924

7,555

Special Graphite Products[General IndustriesApplications]

8,187

17,968

7,227

6,636

4,499

0

8,715

25,492
23,003(+7.6%)

28,0006,261

25,000Special Graphite Products[Electronics Applications]

7,295
2,031

1,469

969
07/5
07/5月期

1,047
08/5
08/5月期

1,355

676
09/5
09/5月期

6,130 4,927
1,202391
10/5
10/5月期(Forecast)(予想）6

1-4. Overview of Operations by Product and Segment(2) Summary and Market Conditions (1/2)
Special Graphite Products[Electronics Applications]

Products used in the manufacture of solar cells: although rapid annual growth of above 50% was seen until the first halfof the year, there was a sudden decline in the second half of the year largely caused by a rapid downturn in mainstay
Chinese demand. However, for the year as a whole, deposits from the first half of the year led to expansion of just under
20% in comparison with the previous year. It is expected that a real recovery will not occur at this time and that
adjustments will continue for the immediate future. However, it is expected that growing worldwide awareness of theenvironment and commitment to energy efficiency, as well as support through government policies in countries aroundthe world and an increase in the production of raw material polysilicon will lead to a gentle recovery in the autumn, withgrowth returning once again in 2010. We also plan to expand sales not only of silicon crystals but also covering
membranes and compounds (including C/C composites).
Products used in the manufacture of single crystal silicon: the semiconductor market worsened considerably in thesecond half of the year, with a major decrease in trade with leading customers, particularly in mainstay 300mm wafers.
This led to approximately 30% decrease for the year as a whole against the previous year. While operation rates atcustomers are gradually beginning to recover, it is expected that more time is required for a real recovery to take place,including graphite stock adjustments.
Products used in manufacture of compound semiconductors: there has been a decline in the market, particularly inmainstay LED products, as a result of the downturn in mobile phones and digital cameras. However, South Korea andTaiwan appear to be leading a real recovery, backed up by a recovery in liquid crystal and mobile phones.

Crucible

Heater[General Industries Applications]

Products used in the manufacture of EDM electrode: there was a rapid decline in the market both in Japan andoverseas in the second half of the year, particularly as a result of the global decline in the automotive and consumer
electronics industries. Difficult conditions are expected for the foreseeable future, but there are hopes of a recovery in
Chinese demand as a result of governmental economic stimulus measures.
With declining capital investment as a result of deteriorating economic conditions,
there was a major decline in metallurgy-related demand for continuous casting andindustrial furnace-related products. However, there are signs that the continuous casting
market in particular has begun to bottom out, and a gradual recovery can be seen.

Continuouscasting dies

EDM electrode
Copyright © Toyo Tanso Co., Ltd. All Rights Reserved71-4. Overview of Operations by Product and Segment(2) Summary and Market Conditions (2/2)
Carbon Products for General Industries[Carbon Products for Mechanical Applications]There was a robust performance in the products for air-conditioners and pantograph sliders, which are affected
little by economic fluctuations. However, there was a decline in demand for mainstay bearings and seals
as a result of capital investment controls in relation to petrochemical plants and pumps. Adjustments will
Pantograph sliders
continue for the immediate future, but there are hopes for a recovery in the latter half of the year.

Bearings[Carbon Products for Electrical Applications]

There has been a drop in demand from China, where production is based, in response to worsening economic conditions
in Europe and the United States. Within Japan, declining conditions in consumer electronics and automobiles has led toa slump in brushes and the products for fuel pumps. We are currently strengthening global management.

Small brushes

Compound Materials and Other Products

SiC coated graphite: While there was underlying support from compound semiconductors, such as
susceptors set in the production of LED and optical pickup devices, there was a decline in themarket for mainstay semiconductors (Si-Epi process). A decline of more than 10% was seen for theyear as a whole against the previous year. Adjustments are expected to continue for the immediate
future, but a gentle recovery is expected in the second half of the year in optical devices andsemiconductors.
C/C composite products: In the second half of the year, there was a rapid decline in large crucibles
for the production of 300mm wafers as a result of reduced operation rates and stock adjustments at
leading customers. However, this was covered by solar cell related products, which led to growth
overall of more than 10% for the year as a whole against the previous year. Although it will taketime for a recovery in crucibles, including for stock adjustments at customers, there is significant
potential for an expansion in solar cell related products, including membrane-related products andnew customers. Growth is expected to recover in the second half of the year, including the deliveryof products ordered last year for nuclear fusion reactors.
Graphite sheets: There was a major decline in the second half of the year, with the downturn
worsening for mainstay automotive and semiconductor products. Difficult conditions will continue
for the immediate future, but there are signs of an underlying recovery. We are currently seeking
to expand sales in new applications, such as heat sinks.

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SiC coated graphite C/C compositeproducts

Graphite sheets

81-5. Overview of Net Sales by Region
Overseas Sales Growth Ratios, Particularly in Asia, with Progress in Globalization(FY 05/5 : 43.9% ⇒ FY 09/5 : 56.7%)(Unit: Yen, millions)

Percentage Distribution

40,000Japan

34,53135,00031,38130,97443.3%

Decline in demand across almost all segments,
particularly semiconductors

30,000Asia
25,49225,00023,00320,00015,0002,874
259
05/5月期
05/5

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11.5%

In addition to slumping demand for brushes,demand for solar cells also declined in second
half of year

7,146

3,219

Slacking off in growth caused by sudden fallin Chinese demand for solar cells in second
half of year

Europe12,9143,734

016,313

13,426

13,94010,0005,000

16,927

33.6%

9,867

10,392

4,970
3,337
2,928
315
06/5月期
06/5

3,826

4,158

3,561

3,864
229
07/5月期
07/5

3,324
254
08/5月期
08/5

3,295
298
09/5月期
09/5

NorthAmerica

10.6%

Downturn in semiconductors, but robust demand
from solar cells and polysilicon production

Otherregions

1.0%

92-1. Earnings Forecast for the Fiscal Year Ending May 31, 2010
Points(Unit: Yen, millions)

09/5

10/5
(Forecast)

Change inyen%
increase

NetNet sales
sales

30,97428,000(2,974)(9.6%)

OperatingOperatingprofitprofit4,741

2,500(2,241)(47.3%)(1,983)(44.2%)(1,066)(41.6%)

Ratio of operating
profit to net sales

15.3%

Although a movement towards recovery canbe seen, partially as a result of the economic
stimulus measures being implemented invarious countries, taking time lag into
account it is expected that an adjustment
phase will continue in the mainstay solar celland semiconductor segments at the very
least into the first half of the fiscal year.
However, in the medium to long-term, theenduring commitment to environmentallyfriendly and energy efficient products is
expected to help restore growth to solar cells,
and there are expectations that growth in
the nuclear and LED segments will leaddemand for high functional carbon to begin
expanding once again. It is expected that
this trend will be seen gradually from thesecond half of the fiscal year. When theimpact of a stronger yen is also taken into
account, we forecast net sales of 28,000
million yen (a year-on-year decrease of9.6%).

Profit margins are expected to fall as aresult of the tough economic environment,
higher depreciation costs (1,150 million yenincrease) brought about by the high level ofcapital investment, higher retirement
benefit expenses (210 million yen increase)and the impact of the stronger yen.
Firstly, we will work to reduce underlyingexpenses and costs and make carefulselections and reductions of capital
investment. At the same time, we will makesound strategic moves with a view to future
growth. We plan to complete constructionof a new 4,000t per year isotropic graphite
plant as scheduled, with materials supply
scheduled to begin in spring 2010.

8.9%

Recurring
Recurringprofitprofit4,483

Ratio of recurring
profit to net sales

14.5%

NetNet income
income

2,566

1,500

Net
Net income
incomeperper shareshare

123.80 yen

72.34 yen

2,500
8.9%

Exchange rate assumed for FY10/5
93 yen/US$, 130 yen/EUR
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102-2. Future Investment(Capital Investment, Depreciation Cost, R&D Cost)
Careful selection and reduction of underlying investment at the same time as
implementing strategic large-scale investment with a view to the future(Unit: Yen, millions)
1,300

8,000

6,000

1,130941

2,000

1,098

1,100
1,000

R&D cost (right axis)

900
800

731

4,255
4,000

1,200

10,2561,014

700
Depreciation cost(left axis)

10,000Capital investment (left axis)(Unit: Yen, millions)
12,0001,392

5,484

5,437

600
4,444

4,300
3,291

500
400

2,755

300

1,709

200
100

00
06/5月期
06/5

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07/5月期
07/5

08/5月期
08/5

09/5月期
09/5

10/5
10/5月期(Forecast)（予想）
112-3. Return of Profits to Shareholders

Dividend Trend

Dividends

Payout ratio(Unit: Yen)

35円
3530%
Dividends per share

30円
30(30)

Dividends per share(Figure taking the share
split into account)

2525円

Consolidated
payout ratio

25%(22.5)

20%

2020円
201515円
1510円
105円527.6% (30)

20
15%

16.2%

1210%

105%

6.1%
4.1%

3.6%

0円
00%
06/5
06/5月期

07/5
07/5月期

08/5
08/5月期

09/5
09/5月期

10/5
10/5月期(Forecast)(予定）* A 3-for-2 stock split was conducted on June 1, 2007
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122-4. Key Performance Indicator Trends

25%

20%

Recurring profit ratio
ROE
ROA
22.7%

22.6%

19.5%

14.5%

15%
11.3%
10%

12.4%

11.9%

8.9%

9.1%

8.9%

7.1%
5.5%
5%
4.4%
0%

06/5
06/5月期
Copyright © Toyo Tanso Co., Ltd. All Rights Reserved

07/5
07/5月期

08/5
08/5月期

09/5
09/5月期

10/5
10/5月期(Forecast)(予想）13

3-1. Topics- Participation in Exhibitions Worldwide With solar power generation and solar cells attracting increased attention in response to greater environmental awarenessthroughout the world, large exhibitions are being held worldwide. Since this is also a priority area for Toyo Tanso, we havetaken part in exhibitions in Japan, China and Korea with the aim of developing new customers and promoting the superiority ofour products and technologies.
International Photovoltaic Power Generation Expo PVEXPO2009

SEMICON/SOLARCON Korea 2009

The Company took part in the 2nd International Photovoltaic
Power Generation Expo PVEXPO2009, the world’s largest
exhibition in the solar cell industry, which was held at Tokyo Big
Site from February 25 – 27, 2009. We presented graphite heaters
and susceptors and crucibles and plates made from C/Ccomposites. Representatives of approximately 800 companies
visited our booth.

The Company took part in SEMICON/SOLARCON Korea
2009, which was held in South Korea (Seoul) from January 20 –22, 2009. We presented a wide range of graphite products forheat treatment, EDM treatment and continuous casting, as well
as solar cells and semiconductors, and C/C composite products.
Representatives of approximately 700 companies visited ourbooth.

SEMICON/SOLARCON China 2009
The Company took part in SEMICON/SOLARCON China 2009, which was held in
China (Shanghai) from March 17 - 19, 2009. We presented graphiteand C/C composite products for use in furnaces, with a focus on themanufacture of solar cells. Representatives of approximately 150
companies visited our booth.
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14

(Reference 1)
Balance Sheet for the Fiscal Year Ended May 31, 2009

Points(Unit: Yen, millions)

08/5

09/5

Total
Total assets
assets

57,70658,821

Trade
Trade notes
notes andandaccounts
accounts receivable
receivable

10,992

8,257

Inventory
Inventory

7,224

9,520

Tangible
Tangible fixed
fixed assets
assets21,26923,208

Total
Total liabilities
liabilities andandnet
net assets
assets

57,70658,821

Interest-bearing
Interest-bearing debt
debt

1,701

1,394

CapitalCapital

7,692

7,692

NetNet assets
assets46,52348,606EquityEquity ratio
ratio

79.0%

80.6%

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Increase of 2,295 million yen
against 08/5 as a result of build
up in intermediate stock,which had become excessivelylow.



Increase of 1,938 million yen
against 08/5 as a result ofstrengthened capacity inisotropic graphite and added
value processes.



Increase achieved as a result ofnet income of 2,566 millionyen.

15

(Reference 2)
Statement of Cash Flows for the Fiscal Year Ended May 31, 2009

(Unit: Yen, millions)

08/5

09/5

Cash and cash equivalents at
the end of the period

10,491

6,412

Changes in cash and cash
equivalents(1,143)(4,079)Cash and cash equivalents atthe beginning of the period

11,558

10,491

CF from operating
activities

6,635

5,105

CF from investing
activities(5,924)(8,420)

CF from financing
activities(1,753)(568)

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Increase in net income before
taxes and other adjustments,
and depreciation costs.

Expenditure on acquisition oftangible fixed assets.

16

Note: This presentation contains “forward-looking statements” and forecasts of business results. Thesestatements are not historical facts but instead represent the Company’s beliefs regarding future
events, many of which, by their nature, are inherently uncertain and out of the Company’scontrol. It is possible that the Company’s actual results may differ, possibly materially, from theanticipated results and financial condition indicated in these forward-looking statements.
IR Contact
E-mail: ir@toyotanso.co.jp

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