Tokyo Electron  Annual Report 2011

To Our Stakeholders

Tetsuro Higashi, Chairman of the Board

Hiroshi Takenaka, President & CEO

Following the Great East Japan Earthquake that struck on March 11, 2011, we received heartwarming
support and encouragement from many of our stakeholders. We thank you for expressing all your concerns to us. Tokyo Electron has three plants in the affected areas. As we have reported on our website,none of them suffered serious damage, and production capacity has almost returned to levels before thedisaster. At present, we are concentrating on working toward the future with our suppliers and preparing
for power restrictions anticipated for the summer.

2Annual Report 2011

Tokyo Electron

In 2010, the semiconductor market recovered quickly from the unprecedented global downturn andachieved strong growth driven by new consumer electronics such as smartphones, tablets, and demand
for servers along with advances in cloud computing. In this favorable business environment, Tokyo Electron
finished fiscal 2011, the year ended March 31, 2011, with net sales of ¥668.7 billion, operating income of¥97.9 billion, and net income of ¥71.9 billion, marking substantial year-on year growth across the board.
During the fiscal year, management changed its dividend policy by raising the payout ratio from 20% to
35% of consolidated net income. As a result, the total dividend applicable to fiscal 2011 was ¥114 pershare, ¥102 higher than in the previous fiscal year. In this way, we would like to express our heartfelt
gratitude for the understanding and support you have shown toward Tokyo Electron’s business activities
during fiscal 2011.
We believe that the broadening of the range of products that require semiconductors along with thegeographic expansion of the markets will continue over the long term, driven by the continuing evolution of semiconductors. This evolution is made possible by advancement in semiconductor production
process technology. Crucial to this is technological innovation at semiconductor production equipment(SPE) suppliers like us. Similarly, flat panel displays (FPD) are seeing applications expand from television,mobile phones and other products to digital signage and so forth. FPD technology is expected to shift
from liquid crystal displays (LCD) to organic light-emitting diode (OLED) displays. The photovoltaic cell(PV) market is also tipped to develop further given recent developments in favor of renewable sources ofenergy. In this business environment, in fiscal 2012 we aim to refine our distinctive technologies in ourmainstay SPE, and develop production equipment for OLED displays. We will also pour more energy intothin-film production technology for PV, where we can take full advantage of our extensive production
equipment technology. In this manner, we aim to boost Tokyo Electron’s superiority in the production
equipment market into the future.
As a production equipment supplier, Tokyo Electron aspires to be an enterprise that helps to upgradeand enhance social infrastructure and contribute to the betterment of people’s lives. We want to share thismission among management and employees, as we strive to make Tokyo Electron a company brimmingwith aspirations and vitality that we can all be more proud of. That is why our most important basic policy
is to consistently and continuously conduct technological development and human resource development
through the economic cycles. We will drive business expansion through technological innovation andmaintain a highly motivated workforce, with the aim of delivering solid value as a leading global production equipment supplier. At the same time, we will continue to work tirelessly to make Tokyo Electron aneven more attractive company for all of our stakeholders.
We look forward to your continued understanding and support as we endeavor to reach these goals.

Tetsuro Higashi, Chairman of the BoardHiroshi Takenaka, President & CEO3