[Translation: Please note that the following purports to be an excerpt translation from the Japanese original
Business Report and Financial Statements prepared for the convenience of shareholders outside Japan.
However, in the case of any discrepancy between the translation and the Japanese original, the latter shallprevail.]

BUSINESS REPORT(For the Period from April 1, 2013 through March 31, 2014)
1. Particulars Concerning the State of the Group(1) Business Developments[While overseas market prices fell for key metals the performance of Mitsubishi Materials
Corporation (the Company) and Mitsubishi Materials Group (the Group) improved, thanks to impact
from correction of yen appreciation and increased demand for cement as a result of full-scale demand
generated by reconstruction efforts in the wake of the Great East Japan Earthquake.]
During the fiscal year under review, the world economy on the whole headed toward recovery, as although
there was a continuing slowdown in the economies of China, India, and other emerging nations, there werealso signs of improvement such as a gradual change for the better in business conditions in the U.S.
Conditions of the Japanese economy have gradually improved driven by an increase in public
investment, and an increase in personal consumption driven by such factors as an improvement of theemployment/income environment and a rush of demand before the consumption tax rate was raised.
Regarding the operating environment for the Group, although overseas market prices fell for key
metals, including copper, operations were affected overall by a correction in the exchange rate of theJapanese yen. Furthermore, earthquake disaster recovery projects reached a strong tempo and housing
construction increased, leading firm demand for cement.
In this environment, we embarked on the medium-term management plan (FY2012-2014), entitled“Materials Premium 2013―Aiming for New Value Creation”. The plan embraces the basic concept of“Simultaneously implementing growth strategies and financial improvements,” with two initiatives states as
growth strategies: “Business advancement in overseas markets, especially emerging markets” and“Generation of distinctive synergies as an integrated business entity.” Based on this recognition, we havecontinued to implement various measures, expanded its network of production and sales sites, principally in
Asia ex-Japan, and promoted business selection and concentration.
As a result, consolidated net sales for the fiscal year amounted to ¥1,414,796 million, up 9.9% fromthe previous fiscal year. Operating profit increased 26.3% to ¥66,281 million, and ordinary income increased
3.3% to ¥76,902 million. Net income increased 42.4% to ¥52,551 million.

1

On a non-consolidated basis, net sales amounted to ¥735,558 million, up 9.2% from the previous
fiscal year. Operating profit increased 26.8% to ¥23,180 million, ordinary income decreased 22.5% to¥42,134 million, and net income decreased 5.3% to ¥42,377 million.
At its 81st Ordinary General Meeting of Shareholders held on June 29, 2006, the Company
changed its Articles of Incorporation to distribute the surplus following the resolution at the Board of
Directors Meeting. We regard the distribution of profits to all shareholders as one of our most importantpriorities. Accordingly, our policy is to make decisions on profit appropriation based on comprehensive
consideration of various factors related to overall management, such as income over the relevant period,
retained earnings, and financial position. Based on this policy, the Board of Directors, at its meeting on May
12, 2014, decided to distribute the year-end dividend of 4 yen. And with the interim dividend of 2 yen, theCompany made the full-year dividend for the fiscal year under review of 6 yen per share (with an increase of
2 yen from the last fiscal year).
On January 9, 2014, five employees from our company and a subcontractor lost their lives in an explosion
and fire at the Yokkaichi Plant that manufactures polycrystalline silicon and the like. Thirteen other
employees experienced injuries. Furthermore, this resulted in our having temporarily to suspend operationsof manufacturing equipment at that plant to ensure safety. The Group wishes to extend its deepest sorry andapologies for the enormous worry and trouble that everyone involved has suffered, including ourshareholders and our trading partners.
We solemnly accept this situation and will work harder to strength our safety management system
under the Group and will make every effort to ensure such an accident does not happen again, and to rebuild
society's confidence in our company.

2Below is a report of the Group’s performance by business segment.
● Cement[Operating profit of the Cement business rose year-on-year thanks to an increase in sales volumes, due
to an overall increase in Japanese, US and Chinese demand.]In the domestic Cement business, a stable, nation-wide increase in demand caused by the full-scalereconstruction efforts from the earthquake, as well as an increase in other disaster relief work, redevelopment
construction, and housing construction for condominiums and the like, increased sales volumes. Overseas,
sales volume increased due to strong United States demand for private-sector capital spending andhousing-related, as well as increased Chinese demand due to the high-speed rail construction and theconstruction of the new airport in Shandong.
As a result, in the entire Cement business, both net sales and operating profit rose year-on-year.
Ordinary income also rose due to an increase in operating profit.
Consolidated net sales in the Cement business amounted to ¥190,199 million, up 15.4% from theprevious fiscal year. Operating profit rose 34.3% to ¥19,105 million and ordinary income rose 34.2% to¥18,813 million.
● Metals[Operating profit of the copper business increased year-on-year thanks to increased production at the
Naoshima Smelter & Refinery, and the impact from correction of yen appreciation. Operating profit of
the gold and other metals business declined because of production cutbacks and the like. Operating
profit of the copper and copper alloy products business increased because of an increase in sales of
products for the automobile sector.]
In the copper business, the overseas copper market prices decreased, but there was also impact fromcorrection of yen appreciation. At PT Smelting in Indonesia, operational trouble at the mines from which thecompany sources its ore and operation shutdown associated with periodic furnace repairs affected results. At
the Naoshima Smelter & Refinery, however, there were no periodic furnace repairs during the period. This
resulted in increased production, which in turn led to an increase in net sales and operating profit.
In the gold and other metals business, despite the impact from correction of yen appreciation, both
net sales and operating profit decreased as a result of reduced production partly due to a decrease in theamount of metals contained in the raw material ore.
In the copper and copper alloy products business, sales of products for the automobile sector
increased, and there was an increase in net sales and operating profit.
As a result, in the entire Metals business, both net sales and operating profit increased year-on-year.
Ordinary income decreased due to a decrease in dividend income.
Consolidated net sales in the Metals business amounted to ¥696,311 million, up 11.8% from theprevious fiscal year. Operating profit rose 31.0% to ¥23,295 million and ordinary income decreased 6.6% to¥36,549 million.

3● Advanced Materials & Tools[Operating profit of the cemented carbide products business increased year-on-year due to sales
promotions at overseas subsidiaries and the correction for a stronger Yen. Operating profit of thehigh-performance alloy products business declined because the Group continued to select and focus its
operations.]
In cemented carbide products business, sales increased because of sales promotion measures implemented byour overseas subsidiaries and correction of yen appreciation. Furthermore, costs were reduced because of
improved productivity. As a result, there was an increase in net sales and operating profits.
In the high-performance alloy products business, although there was an increase in demand for theaircraft-related market and in sales of products for automobile sector, purchase costs increased as a result ofcorrection of yen appreciation. Also, as the Group continued to select and focus its operations, Tamadai
Corporation ceased to be subsidiary in December 2013, and Mitsubishi Materials C.M.I. Corporation ceased
to be subsidiary in January 2014, resulting in a decrease both in net sales and operating profit.
As a result, in the entire Advanced Materials & Tools business, both net sales and operating profit
increased year-on-year. Ordinary income also increased due to an increase in operating profit.
Consolidated net sales in the Advanced Materials & Tools business amounted to ¥145,898 million,
up 6.8% from the previous fiscal year. Operating profit rose 30.7% to ¥14,090 million and ordinary income
rose 31.8% to ¥13,999 million.
● Electronic Materials & Components[Operating profit of the advanced materials business decreased year-on-year because of weak demand
for advanced materials in semiconductor-related markets. Conversely, operating profit of theelectronic components business increased because of an increase in sales of products for household
appliances. Operating profit of the polycrystalline silicon and chemical products business decreased
because production at the Yokkaichi Plant was suspended.]
Although sales of products for smartphone displays were steady, as demand in the semiconductor-related
markets was low, the advanced materials business recorded a decrease in both net sales and operating profit.
The electronic components business posted an increase in both net sales and operating profit due toincreased sales of products for household appliances, results of cost reductions, and impact from correctionof yen appreciation.
The polycrystalline silicon and chemical products business posted a decrease in both net sales andoperating profit, as sales of polycrystalline silicon decreased as a result of suspension of operation at the
Yokkaichi Plant after an explosion and fire, which occurred there on January 9, 2014.
As a result, in the entire Electronic Materials & Components business, both net sales and operating
profit decreased year-on-year. Ordinary income also fell due to a decline in operating profit and a decrease inequity in earnings of affiliates.
Consolidated net sales in the Electronic Materials & Components business amounted to ¥67,724
million, down 1.3% from the previous fiscal year. Operating profit decreased 16.8% to ¥4,001 million andordinary income decreased 36.6% to ¥2,195 million.

4

● Aluminum[In the aluminum can business, demand for bottle cans decreased. In the rolled aluminum andprocessed aluminum products business, demand increased for aluminum can materials, products forsolar battery and automobiles. Operating profit of the entire Aluminum business declined because ofincreased costs associated with the stronger Japanese Yen.]In the aluminum cans business, demand increased for regular cans mainly for beer or beer-like beverages, but
demand for bottle cans decreased for black coffee and tea-based beverages.
In rolled aluminum and processed aluminum products, demand for aluminum can materials andproducts for solar battery sector lifted. After a decrease in demand in the first half of the period under review,prompted by the end of an Eco-car subsidy, product demand for automobile sector rose again, influenced by
the last-minute rush before the increase in the consumption tax.
Overall the aluminum segment saw an upturn in energy cost and material cost, due to the correctionof yen appreciation.
As a result, in the entire Aluminum business, net sales increased year-on-year but operating profit
decreased. Ordinary income decreased due to a decrease in operating profit.
Consolidated net sales in the Aluminum business amounted to ¥151,564 million, up 3.3% from theprevious fiscal year. Operating profit declined 9.9% to ¥5,559 million and ordinary income decreased 14.3%
to ¥4,739 million.
● Others[Operating profit of the energy-related business decreased year-on-year. Operating profit of the"e-waste" (used electronics and electrical products) recycling and precious metals businesses rose.]In the energy-related business, although coal sales were up, costs increased in the field of nuclear energy
which experienced an increase in sales for decontamination business. In addition to that, survey costs for
new geothermal power development projects increased. As a result, there was an increase in net sales but adecrease in operating profit.
In the "e-waste" (used electronics and electrical products) recycling business, both net sales andoperating profit increased due to an increase in the amount of throughput influenced by the last-minute rush
before the increase in the consumption tax, the increase in the amount of collection of valuable resources andthe effect of cost reductions.
In the precious metal business, although sales decreased for jewelry-related items, sales volumes ofgold bullion increased because of a major drop in the price of gold in overseas markets in the first quarter,
leading to increases in both net sales and operating profit.
As a result, in the entire Others business, both net sales and operating profit rose year-on-year.
Ordinary income dropped because equity in losses of affiliates was recorded.
Consolidated net sales in the Others business amounted to ¥380,110 million, up 8.9% from theprevious fiscal year. Operating profit rose 15.6% to ¥8,048 million and ordinary income decreased 12.0% to¥9,556 million.

5

Sales, operating profit and ordinary income for each business segment of the Group were as follows:Business
Segment

CementMetalsAdvanced
Materials &Tools
Electronic
Materials &Components
Aluminum

OthersElimination
and Corporate
Assets or
Expenses Note)
Total

Item
Net Sales
Operating Profit
Ordinary Income
Net Sales
Operating Profit
Ordinary Income
Net Sales
Operating Profit
Ordinary Income
Net Sales
Operating Profit
Ordinary Income
Net Sales
Operating Profit
Ordinary Income
Net Sales
Operating Profit
Ordinary Income
Net Sales
Operating Profit
Ordinary Income
Net Sales
Operating Profit
Ordinary Income

88th Period(April 2012– March 2013)
Amount% of Total(¥ Millions)
164,764
12.8
14,23027.1
14,02318.8
622,74248.4
17,78933.939,13452.6
136,653
10.6
10,77920.5
10,622
14.3
68,602
5.3
4,811
9.2
3,465
4.7
146,675
11.4
6,168
11.8
5,530
7.4
348,947
27.1
6,964
13.3
10,86414.6(201,134)(15.6)(8,243)(15.8)(9,226)(12.4)
1,287,251
100.0
52,500100.074,414
100.0

89th Period(April 2013– March 2014)
Amount% of Total(¥ Millions)
190,199
13.4
19,10528.8
18,813
24.5
696,31149.2
23,29535.1
36,54947.5
145,898
10.3
14,09021.3
13,99918.2
67,724
4.8
4,001
6.0
2,195
2.9
151,564
10.7
5,559
8.4
4,739
6.2
380,110
26.9
8,048
12.1
9,556
12.4
(217,012)(15.3)(7,819)(11.7)(8,951)(11.7)
1,414,796
100.0
66,281
100.0
76,902100.0

YOY
Change (%)
15.4
34.3
34.2
11.8
31.0
(6.6)
6.8
30.7
31.8
(1.3)
(16.8)(36.6)
3.3(9.9)(14.3)
8.9
15.6(12.0)
7.9
(5.1)
(3.0)
9.9
26.3
3.3

Note: Net sales, operating profit and ordinary income resulting from transactions among the Business divisions have been deductedin the “Elimination and Corporate Assets or Expenses” items.

6(2) Status of Group Financing
In the fiscal year under review, the Company financed its business primarily through issuance of straight
corporate bonds (¥15 billion) and commercial paper and borrowings from banks. Debts (including corporate
bonds) as of the end of the fiscal year amounted to ¥649,843 million, down ¥43,137 million from a year
earlier.
(3) Status of Group Capital Expenditures
The Group determines its capital expenditures by carefully selecting investment cases in the fields where
future profit and growth are expected while working to reduce interest-bearing debt.
In the fiscal year under review, total capital expenditures amounted to ¥65,944 million, which
consisted mainly of maintenance and repairs of existing facilities in each business, as well as reinforcement
and streamlining of production facilities and modification of equipment.
Capital expenditures by business segment in the fiscal year under review were as follows:● Cement
The Group carried out development work related to limestone mine in Japan, as well as maintenance andrepairs on existing facilities mainly in Japan and the US.
Capital expenditures in this business amounted to ¥13,144 million.
● Metals
The Group carried out maintenance and repair work at copper smelting and processing facilities in Japan.
Capital expenditures in this business amounted to ¥19,435 million.
● Advanced Materials & Tools
The Group carried out reinforcement and streamlining work in order to meet the increasing demand in thisbusiness as a whole, as well as maintenance and repair work at existing facilities.
Capital expenditures in this business amounted to ¥16,775 million.
● Electronic Materials & Components
The Group carried out maintenance and repair work at existing facilities for products for electronic materials& components, especially for the semiconductor-related market.
Capital expenditures in this business amounted to ¥3,189 million.
● Aluminum
The Group carried out maintenance and repair work at existing facilities for aluminum beverage cans androlled aluminum products.
Capital expenditures in this business amounted to ¥7,374 million.
● Others
The Group carried out maintenance and repair work at existing facilities.
Capital expenditures in this business amounted to ¥6,025 million.

7(4) Trends of Assets and Profit and Loss Accounts
1. The Group’s Trends of Assets and Profit and Loss Accounts (Consolidated)(¥ millions, except per share data)

Net Sales
Operating Profit
Ordinary Income
Net Income
Net Income per Share
Net Assets
Net Assets per ShareTotal Assets

86th Period(April 2010 –March 2011)
1,333,992
57,29056,425
14,274
10.88
402,868
262.38
1,837,405

87th Period(April 2011 –March 2012)
1,440,847
52,29342,4959,565
7.29
409,074
267.62
1,751,870

88th Period(April 2012 –March 2013)
1,287,251
52,50074,41436,94828.19
466,231309.17
1,811,767

89th Period(April 2013 –March 2014)
1,414,796
66,281
76,90252,551
40.10
525,707348.54
1,778,505

2. The Company’s Trends of Assets and Profit and Loss Accounts (Non-consolidated)(¥ millions, except per share data)

Net Sales
Operating Profit
Ordinary Income
Net Income
Net Income per Share
Net Assets
Net Assets per ShareTotal Assets

86th Period(April 2010 –March 2011)
723,413
14,78233,991
19,79415.09
300,936229.37
1,229,417

87th Period(April 2011 –March 2012)
769,337
14,31926,822
18,19413.87
323,245
246.401,200,368

8

88th Period(April 2012 –March 2013)
673,632
18,281
54,332
44,73834.13
373,683285.101,256,038

89th Period(April 2013 –March 2014)
735,558
23,18042,13442,377
32.33
398,674304.22
1,177,558

(5) Priorities for the Group
1. Group Priorities[While sustained, gradual recovery of the economy is anticipated, the Group will continue to strive to
be “the No. 1 Corporate Group” and will set the growth strategies for the overall Group on
strengthening its basis for growth, its global competitive power, and its pursuit of a recycling-based
business model. ]As for the global economy, while the future is uncertain for the economies of China and other emerging
countries, a gradual recovery is expected mainly in developed countries.
With regard to the Japanese economy, although a rebound is forecasted because of the last-minuterush before the increase in consumption tax, a sustained, gradual recovery of the Japanese economy isanticipated because of firm trends in domestic demand thanks to improvements in corporate profits, andemployment and income environments.
As for the business environment in which the Group operates, while the domestic economy has
showed a trend toward recovery, demand for cement is anticipated to continue because of demand in the
full-scale reconstruction efforts. On the other hand, with the pace of prices in overseas markets for key
metals, including copper, there is some concern for a downward trend.
Furthermore, we recognize that further strengthening our safety control system for the entire Groupis the most important issue because of the major industrial accident that occurred January 9, 2014 at the
Yokkaichi Plant.
In this situation, the Group has formulated its “long-term management policy” that looks toward
the beginning of 2020s, and its medium-term management plan (FY2015-2017) “Materials Premium 2016 –Taking up the Challenge of Becoming the No. 1 Corporate Group.”(i) Long-Term Management Policy
In recent years, the business environment has dramatically changed because of a more complex worldwide
economy, diversified social needs, and an acceleration of the speed of technical innovations. In this situation,
the Group is striving “to become the No. 1 corporate group that creates the new materials on earth utilizing
unique technologies, and contributes to a recycling-oriented society” toward the beginning of the 2020s inorder to securely implement the corporate philosophy “For People, Society and the Earth.”
Based on this policy, each operation of the Group commits to create valuable products and services
with our unique technologies and to take an important position in the industry and market.
(ii) Management policy in the medium-term management plan (FY2015 – 2017)
Our medium-term management plan “Materials Premium 2016” is positioned as a first step to focus on
strengthening our infrastructure to become the No. 1 corporate group, which is defined in our long-term
management policy, and we have set the followings as the growth strategies for the overall Group.

9a. Strengthening the base for growth
Setting the motto “Safety and Health is the First” as our first priority, we will strengthen our safety
management system and cultivate corporate culture to value safety and will structure stable operationalframeworks that contribute to the growth of the Group business.
Also, while accelerating growth by implementing strategic investments of ¥100 billion over thethree-year period, focusing on M&A, and expanding production and sale facilities in the overseas countries,
we will continue to work to improve our financial standing by improving profitability by continued businessselection and concentration.
b. Strengthening global competitivenessBy focusing on strengthening our existing production and sale facilities in the overseas countries anddeveloping the new production and sales bases mainly in the emerging countries, we will acquire the new
growth markets on a global basis.
In particular, the Group will conduct strategic marketing in the automotive and electronics
industries, to boost its competitive position by gaining access to new customers and markets.
c. Pursuing a recycling-based business model
The Group operates business widely across the upstream (sources), midstream (materials) and downstream(processed products) markets. We will continue pursuing the business model to circulate waste materials andproducts to upper stream for reutilization.
We will also facilitate recycling of the wastes that have so far been hard to process through our“Materials Premium” (i.e., distinctive synergies as an integrated business entity) in order to contribute tosustainable growth of the society.

102. Priorities in Each Business● Cement
In the domestic cement business, demand in the public and private sectors was strong. This is evidenced bysome recovery signs represented by public investments for economic policies including the reconstruction
efforts in the wake of the earthquake, and private equipment investments with improved corporate profits.
Nevertheless, manpower constraints at construction sites, and the like, are forecasted to continue. For thatreason, domestic (Japanese) cement demand in FY2015 is forecasted to only be slightly above the previous
fiscal year at 48,000 thousand tons. Under such circumstances, we will organize our sales and supply system
to support the envisioned sales volumes or an increase in cement demand beyond what is forecasted.
In the US cement business, demand is anticipated to recover around the private sector, continuingfrom the gradual recovery in the US economy. For that reason, Mitsubishi Cement Corp will strive toincrease sales volumes and reform prices through sales centering on the Robertson’s Ready Mix, Ltd. thatprovides the ready-mix cement business. We will also strive to increase profitability by efficient work
management of the US cement and ready-mixed concrete businesses by maximizing the use of the businesses
and assets at Robertson’s Ready Mix, Ltd.
In the Chinese cement business, while firm public and private sector demands are forecasted tocontinue in Shandong Province, we will strive to implement stable supplies, and incorporate sales pricerevisions, and strength earning power.

11

● Metals
The supply-demand situation of copper concentrates is expected to become easy due to the enhanced supply
capacity of mines. Copper market price is currently on a downward trend. However, we will watch this trend
closely in the future together with currency exchange rates and stock market trends.
In the copper and copper alloy products business, demand for products for automobiles andelectronic materials is forecasted temporarily to decrease because of the rise in consumption tax, but later, agradual recovery is expected.
The Group will respond actively to these conditions. In copper operations overall, we will continue
to raise the efficiency of energy use and squeeze fixed costs, to lower our break-even point, thereby building
a robust constitution that is not vulnerable to fluctuations in the price environment. In copper smelting, we
will work to deliver stable operations at smelters both in Japan and overseas while expanding recycling
operations by constructing a treatment framework that can manage difficult-to-handle waste. By boosting
revenues from waste treatment, the Group will bolster its profitability. In the copper and copper alloy
products business, we will continue to increase profitability by enhancing sales competitiveness throughaccelerated development of alloys, drawing on our technological and development capabilities.
Also, as of April 1, 2014, sales of precious metals bullion that had been classified in the precious
metals business were integrated into the Metals business. In the future, production and sales of the precious
metals bullion will be managed in an integrated fashion to make work more efficient and to strengthen
profitability.
● Advanced Materials & Tools
In the cemented carbide products business, in addition to an overall continuing sense of a slowdown ineconomic growth in emerging countries, the pace of the recovery of demand in the US and Europe wasuneven throughout the country. Nevertheless, there was a trend toward overall recovery for the ordering
environment. Demand is expected to expand particularly in the automobile-related and aircraft-related
markets, where our main customers are, in the medium- and long-term. Amid such circumstances, we willfurther strengthen high-performance, high-precision product development and scale up our engineering
service organization, to support the needs of our customers as a general tool manufacturer. On the sales side,
we will be working on reinforcing our sales activities through the expansion of our sales network, bybuilding out our array of sales bases mainly in emerging countries. In addition, we will continue to promote
the diversification of raw material procurement sources, such as by improving the recycling ratio in order tostably procure tungsten, which is a main raw material of cemented carbide products.
Turning to high-performance alloy products business, Tamadai Corporation and Mitsubishi
Materials C.M.I. Corporation ceased to be subsidiaries, while MMC Superalloy Corporation will change
from being a consolidated subsidiary to being an equity-method affiliate because of becoming a joint venturecompany, targeting July, 2014. While these moves are forecast to reduce revenues and earnings over the shortterm, demand for sintered products is forecast to expand due to growth in automobile-related industries.
Amid such circumstances, the Group will start smooth operations at new sintered-products plants overseas,launch fresh products at existing plants, and strengthen production technology in Japan. This latter initiative
will improve quality and pare costs by raising productivity. In this way the Group will strive to expand
earnings.

12

● Electronic Materials & Components
In the advanced materials business, sales of products for smartphone displays and for solar battery are
expected to be firm, but demand for semiconductor-related products is opaque. Also, in addition to a positive
trend in demand for products for hybrid automobiles, demand is expected to increase for products inindustries other than for automobiles. In the markets, we will continue to increase profitability by using coretechnological capabilities, and enhancing sales competitiveness and proposal capabilities to clients.
In the electronic devices business, although sales of products for household appliances have a firm
trend, there is some concern for decelerated growth in the future for the Chinese economy; demand is opaque.
In the future, we will strength our sales organizations in emerging countries, implement early introductionsof new products and further reduce costs in our efforts to strengthen the business structure.
In polycrystalline silicon and chemical products, the Group will draft measures to prevent
recurrence of the explosion and fire at Yokkaichi Plant, in consideration of the recommendations of thecommittee investigating the accident. The Group is also working to restart safe operations, soliciting
guidance from related governmental authorities.
● Aluminum
In the aluminum cans business, although we cannot expect a major increase in demand for the overall
domestic drink market, we are working more stably to take orders for regular cans, and actively making
efforts to expand sales of aluminum bottle cans, which is our strategic product, for black coffee andtea-based beverages. We will also actively promote advantageous procurement of raw materials, stableproduct quality and cost reductions.
In the rolled aluminum and processed aluminum products business, although no dramatic increasein domestic demand is expected, we will work toward securing orders for can materials, and products forautomobiles and electronic materials. We will also undertake efforts to expand sales for the automobile
market which is forecasted to have increased demand overseas.
We will also contribute to establish a resource-recycling society by actively promoting therecycling business of used aluminum cans, which the Group has long worked on.
We ask for the ongoing support and cooperation of shareholders as we implement these measures with theaim of consolidating the collective potential of the Group and creating value as an integrated business entity.

13(6) Major Business Activities of the Group (as of March 31, 2014)
The major business activities of the Group are production and sales of cement and ready-mixed concrete andother products; refining, production and sales of copper, gold, silver and other metals; production and salesof cemented carbide products and high-performance alloy products; production and sales of advanced
materials, electronic components, polycrystalline silicon and chemical products; and production and sales ofaluminum beverage cans , rolled aluminum and processed aluminum products ,etc. The major products andservices of each business are as follows:Business Division
Major Products
CementMetalsOrdinary Portland cement and various other types of cements, cement-based solidification materials,
aggregate, ready-mixed concrete, secondary cement products,.
Copper, gold, silver, lead, tin, zinc alloy, sulfuric acid, processed copper products (copper cakes,
billets, copper alloy products, wire rods, etc.)

Advanced
Materials& Tools

Cemented carbide products (cemented carbide tools, cement carbide alloy, etc.), high-performancealloy products (corrosion-resistant alloy, heat-resistant alloy, special copper alloy, precision forging
products, sintered products, etc.)

Electronic
Materials& Components

Advanced materials (fine materials for assembly, sputtering targets, precision silicon products,
insulating circuit substrates, etc.), electronic components (surge absorbers, thermistor sensors, etc.),polycrystalline silicon, columnar crystal silicon, chemical products (fluorine chemical products,
conductive coatings, etc.), silane gas, etc.
Bodies, ends and caps of aluminum beverage cans, rolled aluminum products, processed aluminumproducts, etc.
Energy related (coal, geothermal and hydro-power generation, nuclear fuel cycling business(consignment of surveys, research, design and operations, etc.)), precious metals (precious metals
products, jewelry, etc.), environmental and recycling related (recycling of home appliances, etc.), realestate (real estate development, leasing, management, trading, forestry), others (engineering,
geological surveys, resource exploration, and consulting, etc.)

Aluminum

Others14

(7) The Group’s Major Plants and Business Offices (as of March 31, 2014)
1. The Company
Head Office
1-3-2, Otemachi, Chiyoda-ku, Tokyo
CementMetalsPlants and others

Advanced Materials& Tools
Electronic Materials& Components

Aomori Plant, Iwate Plant, Yokoze Plant (Saitama),
Higashitani Mine (Fukuoka), Kyushu Plant (Fukuoka)
Akita Refinery, Naoshima Smelter & Refinery (Kagawa),
Ikuno Plant (Hyogo), Sakai Plant (Osaka)
Tsukuba Plant (Ibaraki), Gifu Plant, Akashi Plant (Hyogo),
Sanda Plant (Hyogo), Ceramics Plant (Saitama), Yokkaichi Plant (Mie)

Human Resources Development Center (Saitama),
Saitama Property Management Office,
OthersEnergy Project & Technology Center (Saitama)
Sapporo Branch, Tohoku Branch (Miyagi), Nagoya Branch,
Osaka Regional Head Office, Kyushu Branch (Fukuoka)
Central Research Institute (Ibaraki)
1)

Branch (office)
R&D Centers

Vancouver (Canada), Santiago (Chile), Bangkok (Thailand), London (U.K.), Sydney (Australia),
Suva (Fiji)
Note 1: Production Engineering Center (Saitama) has been setup as of April 1, 2014.
Note 2: Shanghai Office (China) was abolished as of August 31, 2013.

Offices 2)15

2. Major Subsidiaries
Business Division
CementMetalsAdvanced Materials& Tools 2)

Name of Subsidiaries 1)
MCC Development Corp. (U.S.), Robertson’s Ready Mix, Ltd. (U.S.),Tokyo Hoso Kogyo Co., Ltd. (Tokyo), Mitsubishi Cement Corp. (U.S.)PT Smelting (Indonesia), Mitsubishi Shindoh Co. Ltd., (Tokyo), Mitsubishi Cable Industries, Ltd.
(Tokyo), Onahama Smelting & Refining Co. Ltd. (Tokyo)
Diamet Corporation (Niigata), Mitsubishi Materials Tools Co., Ltd. (Tokyo),
MMC Superalloy Corporation (Saitama)

Mitsubishi Polycrystalline Silicon America Corp. (U.S.),
Mitsubishi Materials Electronic Chemicals Co., Ltd. (Akita),
MMC Electronics (HK) Ltd. (China)
Mitsubishi Aluminum Co., Ltd. (Tokyo), Universal Can Corporation (Tokyo),
Aluminum
MA Packaging Co, Ltd. (Tokyo)
Ryoko Sangyo Corporation (Tokyo), Mitsubishi Materials Techno Corp. (Tokyo),
Dia Consultants Co., Ltd. (Tokyo), Mitsubishi Materials Real Estate Corporation (Tokyo),
OthersMaterials’ Finance Co., Ltd. (Tokyo)
Note 1: Words within parentheses in the table denote the regions (for domestic subsidiaries) or countries (for overseas subsidiaries)
where each subsidiary's head office is located.

Electronic Materials& Components

Note 2: Mitsubishi Materials Tools Co., Ltd. was absorbed and merged with the Company as of April 1, 2014.

16

(8) The Status of Employees (as of March 31, 2014)
1. Status of Employees of the Group (Consolidated)
Business Division
CementMetals 2)
Advanced Materials & Tools
Electronic Materials & Components
Aluminum
OthersAll Companies (for the whole Group) 3)
Total

Number of Employees 1)
4,245 (increased by 83)
5,167 (increased by 646)
5,926 (increased by 188)
1,412 (decreased by 37)
2,770 (decreased by 64)
2,973 (increased by 104)619 (increased by 11)
23,112 (increased by 931)

Note 1: Employee numbers within parentheses denote the change from the previous fiscal year-end.
Note 2: There has been an increase in the number of employees in the Metals business because of the effects of handling theSanbo Shindo (Thailand) Co., Ltd. as a consolidated subsidiary.
Note 3: Employees stated for all Companies (for the whole Group) are attached to administrative divisions that cannot be demarcatedwithin a specific business division.

2. Status of Employees of the Company (Non-consolidated)
Number of Employees
YOY Change (persons)Average Age (years)(persons)
4,183
Increased by 15
41.7

17

Average Years of
Employment (years)
17.2

(9) The State of Major Subsidiaries and Affiliates (as of March 31, 2014)
1. The State of Major Subsidiaries
Percentage ofOwnership
Name of the Company
Paid-in CapitalLine of Business(including indirectownership) (%)

PT Smelting
MCC Development
Corp.
Onahama Smelting &Refining Co. Ltd.
Diamet Corporation
Mitsubishi Cement
Corp.
Mitsubishi
Polycrystalline
Silicon America Corp.
Materials’ FinanceCo., Ltd.
Mitsubishi AluminumCo., Ltd.
Mitsubishi ShindohCo., Ltd.

326 million U.S. dollars
1)

811 million U.S. dollars

60.5

1), 2), 3)

70.0

6,999 million yen

55.7

1,500 million yen

100.0

70 million U.S. dollars
1),2)

328 million U.S. dollars

67.0

Production and sales of electrolytic
copper in Indonesia
Investment in ready-mixed concretebusinesses in the U.S.
Production and sales of electrolytic
copperProduction and sales of sinteredproducts
Production and sales of cement in thesouth-west area of the U.S.
Production and sales of polycrystalline
silicon for semiconductors in the U.S.

1)

100.0

30 million yen

100.0

8,196 million yen

87.7

8,713 million yen

100.0

21,815 million yen

100.0

Mitsubishi Materials
Tools Co., Ltd.

100 million yen

100.0

Sales of cemented carbide tools

Mitsubishi Materials
Techno Corp.

1,042 million yen

100.0Technical construction and civilengineering; production and sales ofindustrial machinery

4,500 million yen

100.0

Sales and leasing of real estate

8,000 million yen

80.0

393 million yen

100.0

Mitsubishi Cable
Industries Ltd.

Mitsubishi Materials
Real Estate Corporation
Universal Can
Corporation
Ryoko Sangyo
Corporation
Robertson’s
Ready Mix, Ltd.

32 million U.S. dollars
1),2)

100.0

Financing the Company and its
affiliates
Production and sales of rolled andprocessed aluminum products
Processing and sales of copper andcopper alloy
Production and sales of optical andelectronic components, cables forelectricity and communication

Production and sales of aluminum
beverage cans
Sales of the Company’s products andother non-ferrous metal products
Production and sales of ready-mixed
concrete and aggregate in thesouth-west area of the U.S.

Note 1: Paid-in capital is shown.
Note 2: This company closes accounts in December. For that reason, paid-in capital as of December 31, 2013 is listed, but there is nochange in the paid-in capital as of March 31, 2014.
Note 3: MCC Development Corp. made a capital increase as of January 10, 2013 increasing its paid-in capital from 498 million U.S.
dollars to 811 million U.S. dollars.

18

2. The State of Major Affiliates
Name of the Company

Paid-in Capital(Million Yen)

Percentage ofOwnership(including indirectownership) (%)

Ube-Mitsubishi Cement
Corporation

8,000

50.0

NM Cement Co., Ltd

7,001

30.0

Kobelco & Materials
Copper Tube, Ltd.

6,000

45.0

SUMCO Corporation

136,607

27.8

P.S. Mitsubishi
Construction Co. Ltd

4,218

33.5

Mitsubishi Nuclear FuelCo., Ltd.

11,40030.0

19Line of Business

Sales of cement and cement
related products
Investment in Nghi Son Cement
Corporation (Vietnam)
Production and sales of copper
tubes and fabricated copper tubes
Production and sales of siliconwafers for semiconductors
Pre-stressed concrete works, civilengineering and sales of concrete
products
Production and sales of nuclear
fuels

(10) Succession of rights and obligations in businesses of other companies through absorption-typecompany mergers and splits
The Company absorbed and merged with our company subsidiary Mitsubishi Materials Tools Co., Ltd. as ofApril 1, 2014 by a decision made at the Board of Directors on September 25, 2013. All rights and obligations
relating to that company have been succeeded.
(11) Acquisition or disposal of shares, equity interests or share options in other companies
The Company passed a resolution at the Board of Directors convened on November 27, 2013 to transfer to
Dow Corning Corporation (U.S.) shares that the Company has in Hemlock Semiconductor Corporation(U.S.) as of November 28 of the same year.
(12) The Group’s Major Lenders (as of March 31, 2014)
Company Shares held by the Lender
Borrowed
AmountMajor Lenders
Number of Shares Held
Percentage of(Million Yen)

The Bank of Tokyo-Mitsubishi
UFJ, Ltd.
Mitsubishi UFJ Trust andBanking Corporation
Mizuho Bank, Ltd.
Development Bank of Japan Inc.
The Norinchukin Bank

(Thousand)Shareholding (％)

162,42124,651

1.9

82,83011,5940.9

38,82930,60016,353

1,570
−
5,001

0.1
−
0.4

Note: Percentages of shareholding were calculated after deducting treasury shares (4,425,844 shares).

20

2. Articles Concerning Stock (as of March 31, 2014)(1) Total number of authorized shares: 3,400,000,000 (no change from the previous fiscal year-end)(2) Total number of issued shares: 1,314,895,351 (no change from the previous fiscal year-end)(3) Number of shareholders: 126,732 (decreased by 11,839 from the previous fiscal year-end)
This includes 92,694 shareholders with voting rights (decreased by 10,223 from the previous fiscal
year-end).
(4) Major Shareholders
Name of Shareholders
Japan Trustee Services Bank, Ltd. (Trust account)
The Master Trust Bank of Japan, Ltd. (Trust account)
National Mutual Insurance Federation of Agricultural
Cooperatives
Meiji Yasuda Life Insurance Company
The Bank of Tokyo-Mitsubishi UFJ, Ltd.
Mitsubishi Heavy Industries, Ltd.
Nippon Life Insurance Company
Mitsubishi Estate Co., Ltd.
Japan Trustee Services Bank, Ltd. (Trust account 1)
Mitsubishi Electric Corporation

Number of Shares Held

Percentage of(Thousand)Shareholding (％)

82,72154,498

6.3
4.2

33,961

2.6

31,01824,651
19,20918,212
17,397
15,914
14,936

2.4
1.9
1.5
1.4
1.3
1.2
1.1

Note: Percentages of shareholding were calculated after deducting treasury shares (4,425,844 shares).

21

3. Articles Concerning the Company’s Executives(1) Directors and Corporate Auditors (as of March 31, 2014)
Title
Representative Director
Chairman
Representative Director
President

Name

Representative Director
Executive Vice President

Toshinori
Kato

Representative Director
Executive Vice President

Toshimichi
Fujii

Representative Director
Managing Director

Akira
TakeuchiRepresentative Director
Managing Director

Akio Hamaji

Representative Director
Managing Director

MasaruAramaki

Representative Director
Managing Director

Osamu Iida

Director

Director, Sakai Chemical Industry
Co., Ltd.

Akihiko Ide
Hiroshi Yao

General Operation of the Company
Assistant to the President
responsible for:
Mineral Resources; Precious Metals
Business; Aluminum Business
Assistant to the President
President, Cement Company
responsible for:Procurement & Logistics
Assistant to the President
responsible for:
General Affairs; Human Resources;
Safety & Health; AffiliatedCorporations Business
Assistant to the President
responsible for:
Corporate Communications & IR;
Internal Audit; Finance & Accounting
Assistant to the President
President, Electronic Materials &Components Company
Assistant to the President
President, Metals Company
responsible for:
Safety & Health; Corporate Production
Engineering

Corporate Auditor

Outside Director, P.S. Mitsubishi
Construction Co., Ltd.

President, Materials’ Finance Co.,
Ltd.

Representative Director, Okamoto
Associates, Inc.2);
Outside Director, Nippon Yusen
Kabushiki Kaisha (NYK Line)3);
Outside Corporate Auditor,
Mitsubishi Motors Corporation4)
OutsideCorporate
Auditor,
SUMCO Corporation

Yukio
Okamoto1) 12)

Corporate Auditor(Standing)Corporate Auditor(Standing)Corporate Auditor(Standing)

Important Positions of
Other Organizations

Position and Responsibilities

Keisuke
Yamanobe 5)
Akihiko
Minato6) 7) 12)
Toshikazu
Murai

8)

Senior Advisor, Mitsubishi UFJ
Trust and Banking Corporation10)
Outside Corporate Auditor,
Mitsubishi Estate Co., Ltd.11)

Akio Utsumi
6) 9) 12)22

Note 1: Director Mr. Yukio Okamoto is an Outside Director as defined in Article 2, Paragraph 15 of the Companies Act.
Note 2: There is no business relationship between the Company and Okamoto Associates, Inc.
Note 3: There is a business relationship for the transportation of coal between the Company and NYK Line.
Note 4: There is a business relationship for the sale and purchase of goods between the Company and Mitsubishi Motors
Corporation.
Note 5: Corporate Auditor Mr. Keisuke Yamanobe has experience as Director of the Company, responsible for accounting andfinance, and have extensive knowledge of finance and accounting.
Note 6: Corporate Auditors Mr. Akihiko Minato and Mr. Akio Utsumi are Outside Corporate Auditors as defined in Article 2,
Paragraph 16 of the Companies Act.
Note 7: Corporate Auditor Mr. Akihiko Minato has experience in think-tank management and has extensive knowledge of financeand accounting.
Note 8: Corporate Auditor Mr. Akihiko Minato resigned his post as auditor of The Nanto Bank, Ltd as of June 27,2013.
Note 9: Corporate Auditor Mr. Akio Utsumi has experience in bank management and has extensive knowledge of finance andaccounting.
Note 10: There is a business relationship between the Company and Mitsubishi UFJ Trust and Banking Corporation for borrowing
funds from it, providing debt guarantee to it, and entrusting the Company's pension funds to it.
Note 11: There is a business relationship for real estate rental and leasing between the Company and Mitsubishi Estate Co., Ltd.
Note 12: The Company has notified Tokyo Stock Exchange, Inc. that Director Mr. Yukio Okamoto and Corporate Auditors Mr.
Akihiko Minato and Mr. Akio Utsumi are Independent Executives (Outside Director or Outside Auditor with no conflict ofinterest with general shareholders) in accordance with their regulations, respectively.
Note 13: The following Corporate Auditor resigned during the fiscal year under review.
Corporate Auditor Mr. Hiroshi Kanemoto (As of June 27, 2013)

The following Directors have been given new title or posted to new positions shown below as of April 1,
2014.

Title

Name

Representative Director
Executive Vice President

Toshinori Kato

Representative Director
Executive Vice President

Toshimichi Fujii

Representative Director
Executive Vice President

Akira Takeuchi

Representative Director
Managing Director

Osamu Iida

Position and Responsibilities
Assistant to the President
responsible for:Procurement & Logistics; Mineral Resources;
Aluminum Business; Affiliated Corporations Business
responsible for:Special Assignments
Assistant to the President
responsible for:
General Affairs; Human Resources; Safety & Health; Crisis
Management
Assistant to the President
President, Metals Company
responsible for:
Safety & Health; Corporate Production Engineering

23

(Reference) The following Executive Officers had assumed office as of April 1, 2014:
Title
Name
Position and Responsibilities
Senior Executive
Officer

Kimball McCloud

President, Mitsubishi Cement Corp.
President, MCC Development Corp.
Chairman, Robertson’s Ready Mix, Ltd.
Vice President, Cement Company

Senior Executive
Officer

Teruhiko Masuda

President, Advanced Materials & Tools Company

Senior Executive
Officer

Hiroshi Kondo

General Manager, Mineral Resources & Recycling Business Unit

Senior Executive
Officer

Chitoshi Mori

General Manager, Corporate Strategy Div.

Senior Executive
Officer

Yoshihiko Kimura

Responsible for System Strategy; Corporate Research & Development

Senior Executive
Officer

Naoki Ono

President, Cement Company

Executive Officer

Yasuhiko Noguchi

Assistant to the General Manager, Mineral Resources & Recycling
Business Unit;
Assistant to the President, Electric Material & Component Company

Executive Officer

Nobuo Shibano

Vice President, Electric Material & Component Company

Executive Officer

Yasunobu Suzuki

Vice President, Metals Company

Executive Officer

Hiroaki Anzai

General Manager, Safety & Health Dept.

Executive Officer

Koso Saeki

Vice President, Cement Company

Executive Officer

Hikaru Kimura

General Manager, Human Resource Dept.

Executive Officer

Kenichiro Ishizuka

General Manager, Finance & Accounting Dept.

Executive Officer

Fumio Tsurumaki

Vice President, Advanced Materials & Tools Company

Executive Officer

Kenichi Watase

General Manager, Corporate Marketing & Overseas Business
Development Dep., Corporate Strategy Div.

Executive Officer

Yoshikazu Okada

President, Japan New Metals Co., Ltd.

Executive Officer

Naoyuki Shimoda

President & CEO, Yantai Mitsubishi Cement Co., Ltd.

Executive Officer

Tairiku Matsumoto

General Manager, Tsukuba Plant

Executive Officer

Soichi Fukui

Vice President, Electronic Materials & Components Company

Executive Officer

Masato Koide

General Manager, Naoshima Smelter & Refinery24

Executive Officer

Kenji Shimamura

General Manager, General Affairs Dept.

Executive Officer

Koji Sakamoto

Vice President, Metals Company

Executive Officer

Tatsuro Maeda

Vice President, Mitsubishi Cement Corp.
Vice President, MCC Development Corp.

Executive Officer

Kazuhiro Kishi

General Manager, Kyushu Plant

25

(2) Directors and Corporate Auditors’ Remuneration
Position
Directors (of which

Total Amount of
Remuneration(Millions of yen)465

2)

Remuneration by Type (Millions of yen)
Basic

Bonus

Number of Executives(persons) 1)

5)

364

Outside Directors)

(23)

(23)

Corporate Auditors(of which Outside
Corporate Auditors)

125 3)

125

(50)

4)

11 Directors
101

(50)

-

(1 Outside Director)
5 Corporate Auditors (2Outside Corporate
Auditors)

Note 1: The number of Directors/Corporate Auditors includes two Directors and one Corporate Auditor whose terms ended or who
resigned its office during the fiscal year under review. There are nine Directors and four Corporate Auditors as of the end of
the fiscal year under review.
Note 2: It was resolved at the 82nd Ordinary General Meeting of Shareholders held on June 28, 2007 that the amount of
remuneration to Directors should not exceed ¥49 million per month (excluding salaries as employees for Directors who also
serve as employees), including remuneration not exceeding ¥4 million for Outside Directors.
Note 3: It was resolved at the 82nd Ordinary General Meeting of Shareholders held on June 28, 2007 that the amount of
remuneration to Corporate Auditors should not exceed ¥17 million per month.
Note 4: Of the basic remuneration for Directors, stock-based remuneration is ¥39 million.
Note 5: It was resolved at the 81st Ordinary General Meeting of Shareholders held on June 29, 2006 that the amount of bonuses for
Directors other than Outside Directors should not exceed ¥170 million per annum.

(3) Policy regarding the determination of remuneration
1. Directors
We make it a basic policy to appropriately link the remuneration for Directors to corporate performance andperformance of individual Directors. The remuneration for Directors is comprised of basic remuneration andbonuses (not paid to part-time Directors).
Firstly, the amount of basic remuneration is determined in accordance with the title andperformance of each Director.
The portion of basic remuneration is paid as stock-based remuneration (not paid to Outside
Directors) and used for purchasing the Company's shares through the Company's director shareholding
association. The Company's shares acquired based on the remuneration cannot be sold at least during each
Director's term of office. This aims to link the remuneration to medium- and long-term corporate
performance.
Secondly, the amount of bonuses, as remuneration linked to short-term corporate performance, isdetermined at the end of the fiscal year by making as indicators consolidated net income and ordinary
income during the fiscal year and taking into consideration performance of individual Directors. The bonuses
can be reduced or removed entirely depending on business conditions and the amount of dividends for the
fiscal year when bonuses are paid.

2. Corporate Auditors
The remuneration for Corporate Auditors is set at an appropriate level based on discussions among them andis not linked to corporate performance in light of the fact that they assume the responsibility for auditing theexecution of duties by Directors as an independent body entrusted by shareholders.

26

(4) Major Activities of Outside Directors and Auditors
StatusClassification

Name

Outside Director

Yukio Okamoto

OutsideCorporate
AuditorAkihiko Minato

OutsideCorporate
AuditorAkio Utsumi

Major Activities
Mr. Yukio Okamoto participated in 15 out of 16 meetings of the Board of
Directors held during the fiscal year under review. Mr. Okamoto provides
well-informed opinions concerning general management as a Director andwell-informed opinions on international affairs as an informed specialist on
such fields, when necessary.
Mr. Akihiko Minato participated in all 16 meetings of the Board of Directors
and all 14 meetings of the Board of Corporate Auditors held during the fiscal
year under review. Mr. Minato provides well-informed opinions as a
Corporate Auditor, based on abundant experience as a manager andcorporate auditor in a think-tank, etc. and extensive knowledge concerningbusiness management, when necessary.
Mr. Akio Utsumi participated in all 16 meetings of the Board of Directors
and all 14 meetings of the Board of Corporate Auditors held during the fiscal
year under review. Mr. Utsumi provides well-informed opinions as a
Corporate Auditor, based on abundant experience as a manager in a financial
institution and extensive knowledge concerning business management, whennecessary.

(5) Outline of the Content of Limited Liability Agreement
For the purpose of facilitating the appointment of valuable human resources, provisions of the Articles ofIncorporation allow the Company to execute with Outside Directors and Outside Corporate Auditors
agreements limiting liability for damages in accordance with Article 427, Paragraph 1 of the Companies Act.
In accordance with the provisions, the Company has concluded Limited Liability Agreements with one
Outside Director and two Outside Corporate Auditors. The outline of the Agreements is as follows:
1. Limited Liability Agreement with the Outside Director
With respect to liability as described in Article 423, Paragraph 1 of the Companies Act, if the Outside
Director performs his duty in good faith and without gross negligence, the Outside Director shall be liable to
the Company for damages only to the extent of minimum liability as set out in Article 425, Paragraph 1 of
the Companies Act. The Company shall indemnify the Outside Director for damages in excess of the amountof the liability.
2. Limited Liability Agreement with the Outside Corporate Auditors
With respect to liability as described in Article 423, Paragraph 1 of the Companies Act, if the Outside
Corporate Auditors perform their duty in good faith and without gross negligence, the Outside Corporate
Auditors shall be liable to the Company for damages only to the extent of minimum liability as set out in
Article 425, Paragraph 1 of the Companies Act. The Company shall indemnify the Outside Corporate
Auditors for damages in excess of the amount of the liability.

27

4. Articles Concerning Accounting Auditor(1) Name of the Accounting Auditor: KPMG AZSA LLC(2) Remuneration of Accounting Auditor for the Year Ended March 31, 2014
Content of the Remuneration(a) Remuneration paid by the Company to Accounting Auditors(b) Total amount of monetary and other property benefits paid by theCompany and its subsidiaries (including the above-mentioned)

Amount
143 million yen 1)
402 million yen

Note 1: The Company has not subdivided the amount of remuneration for auditing based on the Financial Instruments and Exchange
Act and the amount of remuneration for auditing based on the Companies Act. In the Auditing Agreement entered with the
Accounting Auditor it is not possible to substantially subdivide the two. The amount in (a) thus includes auditing
remuneration based on the Financial Instruments and Exchange Law.
Note 2: Among the major subsidiaries of the Company, PT Smelting, MCC Development Corp., Mitsubishi Cement Corp.,
Mitsubishi Polycrystalline Silicon America Corp., and Robertson’s Ready Mix, Ltd. use the services of auditing corporations(including auditors who have the appropriate auditing qualifications abroad) other than the services of KPMG AZSA LLC.,
to audit accounting related documents (in accordance with the Companies Act and the Financial Instruments and Exchange
Act and the applicable laws of the concerned foreign countries’ own legislations).

(3) Content of Non-Auditing Duties
The Company subcontracts “Financial Due Diligence Survey Work” and other duties (non-auditing duties) to
the Accounting Auditor that are other than the duties of Article 2, Paragraph 1 of Certified Public
Accountants Act.
(4) Policy on Dismissal or Non-reappointment of the Accounting Auditor
The Company, as a general rule, other than dismissals of Accounting Auditor by with the Board of Corporate
Auditors as stipulated in Article 340 of the Companies Act, shall place on the agenda an item concerning thedecision not to reappoint or to dismiss the Accounting Auditor to the General Meeting of Shareholders basedon the agreement or the request of the Board of Corporate Auditors in the event it is recognized that it isdifficult for the Accounting Auditor to execute its duties suitably.

28

5. Systems to ensure Compliance with Laws and the Articles of Incorporation in the
Execution of Duties by Directors, and Other Systems to Secure Appropriate Business
Operations(1) Systems to Ensure Execution of Duties by Directors and Employees in Conformity with Laws andArticles of Incorporation
1. The Company shall determine the Code of Conduct and internal regulations that should be observed by the
directors and employees and establish corporate ethics and a compliance system.
2. The Company shall determine execution of duties through the Board of Directors, Corporate Strategy
Committee and other committees in accordance with laws, Articles of Incorporation, and internal
regulations and others. In addition, the legal department and the relative department shall carry out the
preliminary review of specific significant matters.
3. The Company shall determine the general policies and plans, etc., concerning compliance at the Meetingsof the Board of Directors. In addition, the Company shall appoint a Director in charge of compliance andestablish a committee related to CSR (corporate social responsibility) and a division responsible forcompliance. The Company shall also enforce cross-divisional compliance promotion activities (includinginternal education) for the whole Company.
4. The Company shall establish a reporting desk to deal with particulars related to problems that may arise
over compliance.
5. The Company shall enforce periodical auditing concerning the state of compliance in each division by thedivision in charge of internal audits.
6. In accordance with its Code of Conduct, the Company shall establish internal structures to ensure
appropriate actions under its policy of resolutely rejecting any involvement whatsoever with anti-social
forces.
(2) Systems for Preservation and Management of Information Related to the Execution of Duties of
Directors
The Company shall properly preserve and manage the minutes of the Meetings of Board of Directors,
meetings of Corporate Strategy Committee and other significant information, based on legislation, Articles
of Incorporation and internal regulations and policies.
(3) Regulations and Other Systems Concerning Risk Management
1. The Company shall deliberate carefully on significant matters through the Board of Directors, Corporate
Strategy Committee, and other decision-making bodies based on legislations, Articles of Incorporation,internal regulations and others. In addition, the Company shall carry out preliminary review of significant
matters by legal and other related departments based on the internal regulations and others in order to
identify risks and prevent risk elicitation and manifestation.
2. The Company shall determine the general regulations, policies, and plans related to risk management at
the Meetings of the Board of Directors. In addition, the Company shall appoint the Director in charge ofrisk management and establish a committee related to CSR and a division responsible for risk
management, and shall enforce cross-divisional risk management promotion activities for the whole
Company.
3. The Company shall determine the various internal regulations and others and enforce suitable management
concerning individual risks, including financial transaction risk, credit transaction risk and information
leakage risk.
4. The Company shall enforce suitable management based on the legislation and ordinances concerning
work-related accidents.
5. The Company shall build a communication system with the aim of preventing damage from accidents on a
massive scale, natural disasters or terrorism, and establish an organization to respond to such events.
29

6. The Company shall enforce periodical auditing concerning the state of risk management in each divisionby the division in charge of internal audits.
(4) Systems to Ensure Efficient Execution of Duties by Directors
1. The Company shall determine rationally the areas of responsibility of each of the Directors and let the
Executive Officers assist the Directors in their execution of duties in accordance with the executive
officers system. In addition, the Company shall determine the areas of responsibility and authority of each
body and division in accordance with the internal regulations and others.
2. The Company shall determine the management plan, allocate suitable management resources and authority
among the various divisions to achieve the plan, and require those divisions to formulate their own
specific plans. In addition, the Directors shall suitably verify the progress state of the plan of each divisionand take appropriate measures when necessary.
3. The Company shall enforce periodic inspection concerning the efficiency of the execution of duties ofeach division by the division in charge of internal audit.
(5) Systems to Ensure Appropriate Operations of the Group consisting of the Company and its Parent
Company and Subsidiaries
1. The Company shall aim to establish corporate ethics and build a compliance system and risk management
system of the Group (including an internal education system) by letting each subsidiary formulate a Codeof Conduct and internal regulations identical to those of the Company.
2. Concerning each subsidiary, the Company shall aim to improve the soundness and efficiency ofmanagement of the subsidiary, and by extension the whole Group, by determining a response liaison
division within the Company. The concerned division shall consult and exchange information with thesubsidiary concerning specific significant matters.
3. Concerning subsidiaries listed on the Stock Exchange, the Company shall exchange the necessary
information with such subsidiaries in order to ensure the efficiency of consolidated management of theGroup. The Company shall also establish an internal control system while respecting the autonomy andindependence of the subsidiaries.
4. The Company shall establish various regulations related to internal controls concerning financial reporting.
The Company shall also establish assessment mechanisms for those internal controls and build a system toensure the accuracy of the Group’s financial reports.
5. In addition to the above-mentioned 1, 2, 3 and 4, the Company shall enforce periodic inspection
concerning compliance, risk management and the efficiency of management of subsidiaries by thedivision in charge of internal audit of the Company.
(6) Particulars Concerning Employees assigned to assist Corporate Auditors and such Employees’
Independence from Directors
The Company shall establish a division and assign full-time employees to support the operations of the
Corporate Auditors. In addition, the Company shall obtain the consent of the Board of Auditors concerningtransfer of such employees and consult with the Board of Auditors concerning assessment and evaluation of
them.

30

(7) Systems for Directors’ and Employees’ Reporting to Corporate Auditors
The Directors and employees shall swiftly report appropriate information to the Corporate Auditors or to theBoard of Corporate Auditors in accordance with the method stipulated in legislations and the internal
regulations of the Company, in the case where there is considerable damage to the Company’s operations inareas for which they are responsible or the possibility of significant impact on the Company. In addition, thesame shall apply in the event that Corporate Auditors request a report about business operations.
(8) Other Systems to Ensure Effective Auditing by Corporate Auditors
1. Corporate Auditors and Representative Directors shall exchange their opinions periodically and when
deemed necessary.
2. Corporate Auditors shall be provided with the opportunity to attend Board of Directors Meetings and othersignificant meetings of the Company.
(Reference) Status of Corporate Governance<Fundamental Policy>
The Company seeks to maintain sustainable development and maximize corporate value through fairbusiness activities. With the aim of complying with relevant laws and regulations and conducting soundbusiness activities sensibly, the Company established corporate behavioral guidelines as the supreme norm
which all employees should comply with and implement in 1997, and positioned this as the supreme norm
for the Group as a whole in 2003. For this purpose, the Group recognizes the importance of efficient andtransparent management and is steadily undertaking measures that fully realize its corporate governance. The
figure below shows the corporate governance structure regarding management decision-making andoversight, and operational execution and audit in the Company.

General Meeting of Shareholders
Appointment/
Dismissal

Appointment/
Dismissal

Board of Directors
Management decision-making
and oversightAppointment/
Dismissal
Oversight

Corporate Strategy
Committee
Deliberation on
important matters

Appointment/
Dismissal

Board of Corporate Auditors
Operational and financial audits

Corporate Auditors
Assistance
Department
Independent Accountants
Accounting audit
CSR Committee
Deliberation on CSR activities

Representative Directors
and Executive Officers
Operational execution

Internal Audit
Department
Internal audit

Headquarters and
In-House Companies

31

CSR Department

6. Fundamental Policy Concerning the Control of the Company(1) Fundamental Policy on Parties in Control of Decisions Concerning the Company’s Financial andOperating Policies
The Company believes that, as a general rule, the control of the Company should be determined through freemarket transactions in the Company’s shares on the Stock Exchanges, and also the decision to accept or
decline a proposal for a Large-Scale Acquisition (Defined in (3) 2. (i) below. The same applies below.)should be ultimately left to the individual shareholders of the Company.
However, there are some Large-Scale Acquisitions that do not contribute to the corporate medium
and long-term shareholder value of the Company (hereinafter referred to as “medium and long-term
shareholder value”), such as those that obviously harm the medium and long-term shareholder value, andthose that essentially force shareholders to sell their shares, etc.
In addition, unless the party carrying out a Large-Scale Acquisition is properly aware of theCompany’s management environment, understands the sources of its corporate value, and aims to ensure andimprove these factors in the medium and long terms, the medium and long-term shareholder value may
possibly be harmed.
Furthermore, while it can go without saying that the freedom of all shareholders’ investment
behavior should be respected to the degree that is possible, the Company believes that, in today’s domestic
takeover regulation, there is not always adequate time or procedures to obtain and to study the informationnecessary for its shareholders to assess whether a fixed Large-Scale Acquisition is appropriate, so that there
is a possibility of that conflicting with the medium and long-term corporate value.
Therefore, the Company believes that it is not appropriate for a party conducting a Large-Scale
Acquisition that could possibly harm the medium and long-term shareholder value as described above, to be
one that dominates the Company’s financial and operating policies decisions.
Therefore, the Company believes that it is necessary to maintain a framework to secure thenecessary time and information for its shareholders to assess whether the acquisition is appropriate andnegotiate with Acquirers on behalf of the shareholders, in order to deter acquisitions that conflict with themedium and long-term shareholder value.
(2) Overview of Special Measures to Ensure the Implementation of the Fundamental Policy
The Company has been developing its various businesses by utilizing technologies accumulated through its
origin, metal and coal mining operations, to form an integrated business entity involved in Cement, Metals,
Advanced Materials & Tools, Electronic Materials & Components, the Mineral Resources & Recycling,
Aluminum and Precious Metals businesses. The Company has a fundamental corporate philosophy ofcontribution to society through its various business activities, and has supplied basic materials indispensable
to people’s lives as a comprehensive basic materials manufacturer.
Moreover, the Company has made consistent efforts to create an affluent society toward helping
reduce environmental impact and establishing a resource-recycling social system. The Company willcontinue striving to ensure and enhance the medium and long-term shareholder value not only by advancing
its business activities, but also by earning the further trust of all stakeholders—including shareholders,
employees, customers, local communities, suppliers and many other related parties—while maintaining aharmonious coexistence with society.

32

In this environment, the Group has been implementing various measures based on "Simultaneously
implementing growth strategies and financial improvements," which is a basic concept of the medium-term
management plan (FY 2012-2014), entitled "Materials Premium 2013 – Aiming for New Value Creation," aswell as two initiatives stated as growth strategies: "Advancement into overseas markets, especially emerging
markets" and "Generation of distinctive synergies as an integrated business entity."
Also, the Group is striving “to become the No. 1 corporate group that creates the new earth-friendly
materials with the unique technologies and contributes to a recycling-oriented society” in our long-term
management policy toward the beginning of 2020s. In the future, we will implement various measures using“strengthening the base for growth,” “strengthening global competitiveness,” and “pursuing a
recycling-based business model” in our medium-term management plan (FY2015 – 2017) “Materials
Premium 2016 – Taking up the Challenge of Becoming the No. 1 Corporate Group” in order to realize
becoming “the No. 1 Corporate Group” as the growth strategies for the overall Group.
(3) Overview of Efforts to Prevent Inappropriate Parties from Assuming Control of Decisions Relating
to the Company’s Financial and Operating Policies
The Company, in conformity with its corporate philosophy and various policies outlined in (2) above, shallcontinue pursuing maximization of the medium and long-term shareholder value in the future. At the sametime, however, it may not be possible to ignore the potential of Large-Scale Acquisitions by third parties that
may harm the medium and long-term shareholder value, as described in (1) above. Therefore, at its meeting
held on May 10, 2013, the Board of Directors passed a resolution entitled “Renewal of the Countermeasures
to Large-Scale Acquisition of the Company’s Shares (Takeover Defense Measures),” (hereinafter called the“New Countermeasures”), which is a modified version of a plan previously in place. The New
Countermeasures received approval at the 88th Ordinary General Meeting of Shareholders held on June 27,
2013.
An outline of the New Countermeasures is given below. For more details, please refer to the May
10, 2013 press release entitled “Renewal of the Countermeasures to Large-Scale Acquisition of theCompany’s Shares (Takeover Defense Measures)” posted on the Company’s website (Japanese language
only): http://www.mmc.co.jp/corporate/ja/01/01/13-0510.pdf
1. Fundamental Policy of the New Countermeasures
For the purpose of ensuring and enhancing the medium and long-term shareholder value, the Company has
set out Countermeasures to Large-Scale Acquisition of the Company’s Shares (Takeover Defense Measures)
incorporating procedures to be observed by a party carrying out or who plans to carry out a Large-Scale
Acquisition of the Company’s shares. The Company shall warn such parties in advance that there areprocedures with which they will be required to comply, that the Company may, in certain circumstances,take protective measures against the acquisition, and the Company shall, in certain circumstances, actuallytake protective measures against the acquisition.

33

2. New Countermeasures Details(i) Targeted Large-Scale Acquisitions
The New Countermeasures shall apply in cases where there is an acquisition of the Company’s sharecertificates that falls under a. or b. below or any similar action (hereinafter referred to as a “Large-Scale
Acquisition”). Any party carrying out or proposing a Large-Scale Acquisition (the “Acquirer”) must comply
with procedures predetermined in the New Countermeasures.
a. An acquisition that would result in the holding ratio of share certificates, etc., of a holder amounting to
20% of more of the share certificates, etc., issued by the Company
b. A tender offer that would result in the ownership ratio of share certificates, etc., of the share certificate
relating to the tender offer, and the owning ratio of share certificates, etc., of a person having a special
relationship totaling at least 20% of the share certificates, etc., issued by the Company.
(ii) Prior Submission of Letter of Intent to the Company
The Acquirer will submit a statement in Japanese (hereinafter referred to as a “Letter of Intent”) to the Boardof Directors such as a promise to observe the procedures prescribed in the New Countermeasures, before
executing the Large-Scale Acquisition.
(iii) Provision of Information
When the Acquirer submits the Letter of Intent, the Company will send to the Acquirer an Information List
that details all the information necessary to be initially submitted. The Acquirer will submit to the Company
adequate information pursuant to the Information List.
The Board of Directors shall require the Acquirer to submit the information within the period set by
the Board (the “Information Provision Requirement Period”), which is 60 days following the sending of theabove-mentioned Information List, and the Board of Directors’ Evaluation Period (Defined in (v) below.
This also applies below.) shall commence immediately upon the expiration of the Information Provision
Requirement Period. However, if a request for an extension based on a plausible reason is made by the
Acquirer, the Information Provision Requirement Period may be extended as needed up to a maximum of 30days. Alternatively, if the Board of Directors determines that the information submitted by the Acquirer issufficient, then the Information Provision Requirement Period will be ended forthwith and the Board of
Directors’ Evaluation Period will commence, even if it is before the expiration of the Information Provision
Requirement Period.
(iv) Disclosure of Information
The Company will disclose the fact that there has been a proposal for a Large-Scale Acquisition by an
Acquirer, and describe the background of the fact. Furthermore, if there is information deemed to be requiredby judgment of the shareholders, that information will be disclosed at a time that is deemed to beappropriate.
Also, in the event that the Board of Directors judges that the information provided by the Acquirer
is adequate, the Acquirer will be notified (hereinafter referred to as “Notice of Completion of Providing
Information”) of that quickly and that will be disclosed.

34

(v) Establishment of Board of Directors’ Evaluation Period
The Board of Directors will begin evaluating and considering the Large-Scale Acquisition after Notice ofCompletion of Providing Information or when the Information Provision Requirement Period has ended. The
period for the Board of Directors to evaluate, consider, negotiate, form opinions or to offer an alternative
proposal (hereinafter referred to as “Board of Directors’ Evaluation Period”) will be a maximum of 60 days
or a maximum of 90 days depending on the status of the Large-Scale Acquisition.
However, the Board of Directors’ Evaluation Period may be extended by a maximum of 30 days
when deemed necessary by the Board of Directors, or when recommended by the Independent Committee.
(vi) Consulting with the Independent Committee
In the New Countermeasures, in order to eliminate arbitrary decisions by the Board of Directors whencountermeasures are invoked, there is the Independent Committee composed of only people who are
independent of executive personnel that conduct business operations for the Company.
In the event that the Acquirer has not observed the procedures defined in the New Countermeasures,or when it is found that the Large-Scale Acquisition by the Acquirer will cause notable damage to themedium and long term shareholder value, the Board of Directors can consult with the Independent
Committee about whether to invoke countermeasures when it is judged appropriate to invokecountermeasures.
(vii) Recommendation by the Independent Committee Concerning the Invocation of Countermeasures
When there has been consultation by the Board of Directors regarding whether to invoke countermeasures,the Independent Committee will make recommendations for the Board of Directors regarding whether to
invoke countermeasures.
(viii) Resolution by the Board of Directors
The Board of Directors will comply to the degree possible with the recommendation of the Independent
Committee outlined in (vii) above, and will implement a resolution to invoke countermeasures.
(ix) Holding a Shareholders Meeting to Confirm Their Intent
Excluding instances when it is notably difficult to convene a general meeting of shareholders, for thefollowing reasons, the Board of Directors can debate bills for invoking countermeasures by convening ageneral meeting of shareholders (hereinafter the shareholders’ meeting is referred to as the “Shareholders
Meeting to Confirm Their Intent”).
a. When the Independent Committee makes a recommendation concerning the invocation ofcountermeasures that is conditional upon receiving prior approval at a general meeting of shareholders;andb. The Board of Directors deems that it is appropriate to confirm the intent of all shareholders.
The Board of Directors shall pass a resolution to invoke countermeasures in compliance with the resolution
passed at the Shareholders Meeting to Confirm Their Intent.

35

(x) Period to Start Large-Scale Acquisition
When it has been determined by the Board of Directors to convene the Shareholders Meeting to Confirm
Their Intent, the Acquirer may not start Large-Scale Acquisition until the Board of Directors has
implemented a resolution to invoke the countermeasures based on the resolution of the Shareholders Meeting
to Confirm Their Intent. Also, when the Shareholders Meeting to Confirm Their Intent has not been
convened, it is possible to start the Large-Scale Acquisition only after the Board of Directors’ Evaluation
Period has passed.
(xi) Termination or Withdrawal of Countermeasures
In the event that invoking the countermeasures is decided, the Board of Directors can consult with the
Independent Committee regarding whether to terminate or withdraw the countermeasures for the following
reasons.
a. When the Acquirer has terminated or withdrawn the Large-Scale Acquisition; andb. Changes occurred in the facts that presumed judgment of whether to invoke the countermeasures, and thecircumstances are considered not to be appropriate for maintaining the invoked countermeasures in view of
ensuring and enhancing the medium and long-term shareholder value.
The Board of Directors will resolve to terminate or withdraw the countermeasures when it is judged
inappropriate to maintain the countermeasures, complying to the degree possible with the recommendation of the
Independent Committee.
(xii) Specific Content of the Countermeasures in the New Countermeasures
As a countermeasure invoked in accordance with the New Countermeasures, the Company shall, in principle,
exercise the gratis allotment of stock acquisition rights.
Such stock acquisition rights shall be allotted to shareholders as of the allotment date. One right will beallotted per common stock of the Company. Under the New Countermeasures, the Company intends to attach
conditions that the Acquirer or other ineligible parties that meet criteria specified separately may not exercise thestock acquisition rights. Further, the Company plans to attach conditions that enable the Company to acquire thestock acquisition rights allotted to persons other than ineligible parties and, in exchange, issue one common stockof the Company per such stock acquisition right.
(xiii) Effective Period, Abolition, or Amendment of the New Countermeasures
The New Countermeasures shall be effective until the closing of the 91st Ordinary General Meeting of
Shareholders of the Company, to be held in June 2016.
Also, even before expiration of the effective period, the New Countermeasures will be abolished
immediately, for the following reasons.
a. When a general meeting of shareholders of the Company passes a resolution to abolish the New
Countermeasures; andb. When the Board of Directors passes a resolution to abolish the New Countermeasures.
Also, the Company can change the New Countermeasures within a scope that does not violate the basic policy forformalities in line with revisions to laws and ordinances and the like.

36

(4) Determination by the Board of Directors, and the Reasons thereof, that the Measures in (2) above
are in Accordance with the Basic Policy in (1) above and as such do not Harm the Common Interestsof Shareholders or Aim to Maintain the Status of the Company’s Officers
The Board of Directors has determined that the measures in (2) above are in accordance with the basic policyin (1) above. Such reason is that, by ensuring and enhancing the medium- and long-term shareholder value
through the measures in (2) above, and appropriately reflecting it in the value of the Company’s shares, itwill become difficult to conduct a Large-Scale Acquisition that adversely affects the medium- and long-term
shareholder value.
Accordingly, the Board of Directors has determined that the measures in (2) above do not harm thecommon interests of the Company’s shareholders and are not aimed to maintain the status of the Company’s
officers.
(5) Determination by the Board of Directors, and the Reasons thereof, that the Measures in (3) above
are in Accordance with the Basic Policy in (1) above and as such do not Harm the Common Interestsof Shareholders or Aim to Maintain the Status of the Company’s Officers
The measures in (3) above is to prevent inappropriate parties, in the context of the basic policy in (1) above,from conducting Large-Scaled Acquisitions and controlling decisions on the Company’s financial andoperating policies by enabling the Company to invoke countermeasures against Acquirers who do notprovide sufficient information or accede to a request for securing a sufficient period for their examination
and who intend to conduct a Large-Scale Acquisition which may harm the medium and long termshareholder value etc.
Additionally, the measures in (3) above are implemented with the objective of ensuring andenhancing the medium and long-term shareholder value, and in line with such objective, to have the Acquirer
provide the necessary information beforehand concerning the Large-Scale Acquisition that said Acquirer
intends to make so that the required period of time is secured for evaluating and examining, etc., the details
thereof.
Furthermore, a variety of systems and procedures are in place to ensure the reasonableness andfairness of the measures in (3) above for the reason that these measures contain a procedure for confirming
the intent of all shareholders, establish the Independent Committee comprising highly independent members,
give utmost respect to the Committee’s recommendation, establish reasonable and objective criteria for the
invocation of countermeasures, and eliminate arbitrary judgments by the Board of Directors by basing the
invocation of countermeasures on a resolution passed at a Shareholders Meeting to Confirm Their Intent.
Accordingly, the Board of Directors determines that the measures in (3) above are in accordancewith the basic policy in (1) above, and do not harm the common interests of the Company’s shareholders andare not aimed at maintaining the status of the Company’s officers.
In this Business Report, the figures for financial amounts and number of shares are rounded down to thenearest stated unit. Figures for ratios have been rounded up or down to the nearest stated decimal place.

37

FINANCIAL STATEMENTS
Consolidated Balance Sheets[As of March 31, 2014](Millions of yen)
Item

Amount[ASSETS]

Item

Amount[LIABILITIES]Current Assets:

774,465

Current Liabilities:

738,518

Cash and deposits

63,486

Notes and accounts payable-trade106,656

Notes and accounts receivable-trade219,016

Short-term loans payable

256,098

Merchandise and finished goods

81,516

Current portion of bonds payable

40,000Work in process

100,280

Income taxes payable

9,576

Raw materials and supplies

103,155

Deferred tax liabilities

648

Deferred tax assets

10,924

Accrued bonuses

11,975Gold bullion loaned

93,635Gold payable

212,760

Other

104,293

Allowance for loss on disposal of inventories

Allowance for doubtful accounts(1,843)

Other

Noncurrent Assets:

923
99,878

Noncurrent Liabilities:

514,279

Bonds payable

85,140Long-term loans payable

268,605

1,004,039

Property, Plant and Equipment:

650,571

Reserve for directors’ retirement benefits

1,740

Building and structures, net

153,369

Reserve for loss on subsidiaries and affiliates

1,698

Machinery, equipment and vehicles, net

187,634

Reserve for environmental measures

4,117

Land, net

273,048

Deferred tax liabilities

31,650Construction in progress

22,510

Deferred tax liabilities for revaluation

32,532Other, net

14,009Net defined benefit liability

52,787

Intangible Assets:

48,226

Other

36,007

Goodwill

38,816

Other

9,410

Total Liabilities

1,252,797

Investments and Other Assets:

305,241[NET ASSETS]

Investment securities

250,576

Shareholders’ Equity:

Deferred tax assets

31,255

Capital stock

119,457

Other

30,375

Capital surplus

92,272

Allowance for investment loss

(1,168)Retained earnings

207,354

Allowance for doubtful accounts(5,797)

Treasury stock(1,782)

Accumulated Other Comprehensive Income:
Valuation difference on available for salesecurities
Deferred gains or losses on hedges

39,447
31,972
218

Revaluation reserve for land

32,907

Foreign currency translation adjustment(12,348)

Remeasurements of defined benefit plans(13,302)

Minority Interests
Total Net Assets
Total Assets

417,302

Total Liabilities and Net Assets

1,778,505

Note: All amounts less than one million yen are rounded down.

38

68,957525,707
1,778,505

Consolidated Statements of Operations[For the year ended March 31, 2014](Millions of yen)
Item

AmountNet Sales

1,414,796

Cost of Sales

1,199,192

Gross Profit

215,604

Selling, general and administrative expenses

149,322

Operating Profit

66,281

Non-Operating Profit:

32,038Interest income

916

Dividends income

18,964Equity in earnings of affiliates

4,377

Rent income on noncurrent assets

4,559

Other

3,221

Non-Operating Expenses:

21,418Interest expenses

9,686

Rent expenses on noncurrent assets

3,399

Loss on disposal of property, plant and equipment

2,755

Mine liquidation expense

2,704

Other

2,873

Ordinary Income

76,902Extraordinary Income:

51,158Gain on sales of marketable securities and investments in securities

32,078Gain on contribution of securities to retirement benefit trust

10,949Gain on sales of noncurrent assets

4,334

Other

3,796

Extraordinary Losses:

42,714

Impairment loss

32,308Loss on valuation of investment securities

850

Other

9,555

Income before Income Taxes

85,346

Corporate income taxes, resident taxes and business tax

16,509

Income taxes adjustments

9,956

Income before minority interests

58,880Minority interests in income

6,328

Net Income

52,551

Note: All amounts less than one million yen are rounded down.

39

Statement of Changes in Consolidated Shareholders’ Equity[Year ended March 31, 2014 (From April 1, 2013 to March 31, 2014)](Millions of yen)
Shareholders’ Equity

Balance as of April 1, 2013
Change during the fiscal year
Dividends from retained earnings
Net income
Decrease from write-downs of land
revaluation excess
Increase from change of fiscal year
end of consolidated subsidiaries
Increase in number of consolidated
subsidiaries
Purchase of treasury stock
Disposal of treasury stock
Net change in items other thanshareholders’ equity
Total change during the fiscal year
Balance as of March 31, 2014

Capital stock

Capital surplus

Retained earnings

119,457

92,272

158,456

119,457

Treasury stock

Total
shareholders’equity(1,692)

368,495(7,864)52,551(7,864)52,551

1,923

1,923

281

281

2,005

2,005

(0)

(0)

(92)
2

(92)
1

(0)
92,272

48,897
207,354(90)(1,782)48,806417,302

Accumulated Other Comprehensive Income

Balance as of April 1, 2013
Change during the fiscal year
Dividends from retained earnings
Net income
Decrease from write-downs ofland revaluation excess
Increase from change of fiscal
year end of subsidiaries
Increase in number of consolidated
subsidiaries
Purchase of treasury stock
Disposal of treasury stock
Net change in items other thanshareholders’ equity
Total change during the fiscal year
Balance as of March 31, 2014

Valuationdifferenceonavailable
for salesecurities

Deferred
gains orlosses on
hedge

Revaluation
reserve forland

Foreigncurrencytranslation
adjustments

40,516(1,189)34,830(37,422)

Remeasur
Total
ements ofotherdefinedcomprehenbenefitsiveplansincome-36,735

Minority
Interests

Total Net
Assets61,001

466,231(7,864)52,551
1,923
281
2,005
(92)
1

(8,543)

1,407(1,923)25,073(13,302)

2,711

7,956

10,668(8,543)
31,972

1,407
218(1,923)32,90725,073(12,348)(13,302)(13,302)

2,711
39,447

7,956
68,95759,475525,707

Note: All amounts less than one million yen are rounded down.

40Balance Sheets[As of March 31, 2014]
Item

Amount[ASSETS]

Item(Millions of yen)Amount[LIABILITIES]Current Assets:
Cash and deposits
Notes receivable
Accounts receivable
Merchandise and finished goods
Work in process
Raw materials and supplies
Advanced payment
Prepaid expenses
Short-term loans receivables
Other receivables
Gold bullion loaned
Gold bullion in custody
Deferred tax assets
Other
Allowance for doubtful accounts

381,108
6,280
2,297
75,33937,94733,95438,86630,536
951
873
9,927
93,635
41,697
3,217
6,486
(902)

Noncurrent Assets:
Property, Plant and Equipment:
Buildings
Structures
Machinery and equipment
Vessels
Vehicles and delivery equipment

796,450
290,128
53,17926,35254,015073

Tools, furniture and fixtures

1,650

Land
Lease assets
Construction in progress
TimberIntangible Assets:
Mining rights
SoftwareLease assets
Other
Investments and Other Assets:
Investment securities
Securities of affiliates
Bonds of affiliates
Investments

139,899658
13,204
1,092
1,788
488
938
44
317
504,532
109,075
382,095
4
87

Investments in affiliates

6,798

Long-term loans receivable
Long-term loans to affiliates
Other
Allowance for investment loss

34
4,130
7,658
(638)

Allowance for doubtful accounts(4,714)

Total Assets

1,177,558

Current Liabilities:
Notes payable
Accounts payable
Short-term loans payable
Current portion of bonds payable
Lease obligation
Other payables
Accrued expenses
Income taxes payable
Advance received
Progress payment received
Unearned revenue
Accrued bonuses
Employee deposits
Facilities related notes payable
Other facilities related payables
Assets removal liabilities
Gold payable
Other
Noncurrent Liabilities:
Bonds payable
Long-term loans payable
Lease obligation
Deferred tax liabilities
Deferred tax liabilities for revaluation
Provision for retirement benefits
Reserve for loss on subsidiaries andaffiliates
Reserve for environmental measures
Assets removal liabilities
Guarantee deposits received
Other
Total Liabilities

465,237
532
33,391
113,952
40,000376
3,963
16,837
1, 733
12,778
5
74
4,953
8,607
367
10,377
47
212,760
4,479
313,646
85,000155,472
898
19,42428,069
8,018
1,809
4,117
350
4,234
6,251
778,884[NET ASSETS]
Shareholders’ Equity:
Capital stock
Capital surplus
Capital reserve
Other capital surplus
Retained earnings
Other retained earnings
Reserve for advanced depreciation of
noncurrent assets
Deposit for mining search
Earned surplus carried forward
Treasury stock
Valuation and Translation Adjustments:
Valuation difference on available for salesecurities
Deferred gains or losses on hedges
Revaluation reserve for land
Total Net Assets
Total Liabilities and Net Assets

Note: All amounts less than one million yen are rounded down.

41

341,092
119,457
113,165
85,65427,511
110,244
110,2442,695
515
107,033(1,775)57,582
30,114142
27,325
398,674
1,177,558

Statements of Operations[For the year ended March 31, 2014](Millions of yen)
Item

AmountNet Sales

735,558

Cost of Sales

667,176

Gross Profit

68,381

Selling, general and administrative expenses

45,200Operating Profit

23,180Non-Operating Profit:

33,972

Interest income

300

Dividends income

21,946

Gain on bad debts recovered

4,360

Rent income on noncurrent assets

4,589

Miscellaneous revenue

2,775

Non-Operating Expenses:

15,019Interest expenses

5,002

Rent expenses on noncurrent assets

3,222

Mine liquidation expense

2,674

Loss on disposal of property, plant and equipment

1,511

Miscellaneous losses

2,608

Ordinary Income

42,134Extraordinary Income:48,496

Gain on sales of marketable securities and investments in securities

27,468Gain on contribution of securities to retirement benefit trust

10,949Gain on sales of subsidiaries and affiliates' stocks

4,657

Gain on sales of noncurrent assets

4,092

Other

1,328

Extraordinary Losses:

37,292

Impairment loss

27,574

Loss on valuation of stocks of subsidiaries and affiliates

6,565

Other

3,153

Income before Income Taxes

53,337

Corporate income taxes, resident taxes and business tax

2,955

Income taxes adjustments

8,004

Net Income

42,377

Note: All amounts less than one million yen are rounded down.

42

Statement of Changes in Shareholders’ Equity[Year ended March 31, 2014 (From April 1, 2013 to March 31, 2014)](Millions of yen)
Shareholders’ Equity
Capital surplus

Retained earnings
Other retained earnings

Capitalstock

Balance as of April 1, 2013
Change during the fiscal
year
Provision of voluntary
retained earnings
Reversal of voluntary
retained earnings
Dividends fromretained earnings

Capitalreserve

119,457

85,654

Other
capitalsurplusTotal
capitalsurplus27,511

113,165

Reserveforadvanceddepreciati
on ofnoncurrent
assets

DepositforminingsearchRetainedearnings
brought
forward-410

73,79074,2002,801

515(3,316)

-

-

(105)

(410)

516

-

-

(7,864)(7,864)(7,864)42,37742,37742,377

1,530

1,530

1,530

Net income
Decrease fromwrite-downs of land
revaluation excess
Purchase of treasury
stock
Disposal of treasurystock
Net change in items
other than shareholders’equityTotal change during the
fiscal year
Balance as of March 31,
2014

(0)

(0)

Total
retained

Treasury
stock

Total
shareholders’ equity(1,685)305,139

earnings

(92)

(92)

2

1

-

-

(0)

(0)

2,695

105

33,242

36,043(90)

35,952

119,457

85,65427,511

113,165

2,695

515

107,033

110,244(1,775)341,092(Millions of yen)
Valuation and Translation Adjustments

Balance as of April 1, 2013

Valuationdifference on
available for salesecurities

Deferred gains orlosses on hedges

Revaluation
reserve for land

Total valuation andtranslation
adjustments

Total Net Assets

39,774(86)

28,85568,543

373,683

Change during the fiscal year
Provision of voluntary retained
earnings
Reversal of voluntary retained
earnings
Dividends from retained earnings(7,864)

Net income
Decrease from write-downs ofland revaluation excess
Purchase of treasury stock

42,377

Disposal of treasury stock
Net change in items other thanshareholders’ equity
Total change during the fiscal year1
(9,660)229(1,530)(10,961)(9,660)229(1,530)(10,961)

24,991

Balance as of March 31, 2014

30,114142

27,32557,582398,674

1,530
(92)

Note: All amounts less than one million yen are rounded down.

43(10,961)