Year ended March 31, 2008

Profile
In 1939, when the company was established as Shibaura Engineering Works Co., Ltd., our primary focus was on the motor business.
However, in 1998 we completed an ambitious business restructuring to be reborn as a manufacturer of manufacturing equipment for
LCDs, semiconductors and optical discs. It is a young company exactly 10 years old this year, and guided by our determination to be
the “Infrastructure Provider for the Digital Age” we manufacture essential electronic equipment that supports a changing social infrastructure.
The 21st century is the age of IT and of the environment. In working to fulfill the demands of the century, the Company is determined to
become "e-Shibaura", a truly IT-based enterprise, and "E-Shibaura", an enterprise that places priority on the Earth's environment, andthat pursues global business expansion by encouraging innovative attitudes and thinking among employees.

History
1932

Tokyo Electric Company

1939

1949

1991 1996

Oct.,1998

Tokyo Shibaura Electric Co., Ltd. (now, Toshiba Corporation)

Shibaura Engineering Works Co., Ltd.

(Industrial Mechatronics Business)

Toshiba Mechatronics Co., Ltd.
Semiconductor manufacturing

Toshiba Automation Co., Ltd. equipment and others
Manufacturing automation equipment

Shibaura Engineering Works Co., Ltd.
Electric motors

Tokuda Seisakusho Co., Ltd.

Shibaura Engineering Works Co., Ltd.
Motors, flat panel displays manufacturing
equipment and others

Vacuum equipment

Contents
Financial Highlights ・・・・・・・・・・・01
To Our Shareholders ・・・・・・・・・・・02
Topics ・・・・・・・・・・・・・・・・・・05
Financial Review ・・・・・・・・・・・・・06
Medium-Term Management Plan ・・・・・10
Business Overview ・・・・・・・・・・・・14
Corporate Governance ・・・・・・・・・・21

Forward-Looking Statements
This annual report contains forward-looking statements concerning
Shibaura Mechatronics' future plans, strategies and performance. These forward-looking statements are not historical facts, rather they represent

CSR Activities ・・・・・・・・・・・・・・25

assumptions and beliefs based on data currently available. Furthermore, they
are subject to a number of risks and uncertainties that, relate to economic
conditions, worldwide mega-competition in the electronics business, customer

Board of Directors ・・・・・・・・・・・・26

demand, foreign currency exchange rates, tax rules, regulations and other fac-

Investor Information ・・・・・・・・・・・27

fer materially from our expectations.

tors. Shibaura therefore wishes to caution readers that actual results may dif-

Financial Highlights

Year ended
March 31,2008

Year ended
March 31,2007

Year ended
March 31,
2008

(Millions of yen)(Thousands of
U.S. dollars)(Note 1)

Consolidated
Net sales
Operating income (loss)
Net income (loss)
Total assets
Net assets¥

61,441
1,647
426
64,99525,045

Net income per share (loss)

¥

8.62

¥

74,663(1,630)(1,047)73,19725,084$¥(20.60)$(Yen)(U.S. dollars)(Millions of yen)

Non-consolidated
Net sales
Operating income (loss)
Net income (loss)
Total assets
Net assets¥

47,077(480)
539
52,47021,157

¥

10.90

¥

58,144(3,407)(1,420)59,946
21,041$¥(27.93)$(¥Billions)

Net Income(¥Billions)

Net Assets(¥Billions)

24
72

75

75

68

66
59

56

3.2

(U.S. dollars)

0.11

Net Income Per Share

28

5.1

89

469,877(4,792)
5,378
523,709
211,167

Note 1 : The U.S. dollar amounts in this report represent translations of Japanese yen, for convenience only, at the rate of ¥100.19= U.S.$1.00, as of March 31, 2007.

Effective for the year ended March 31, 2007, net assets are presented based on the new accounting standard, "AccountingStandard for Presentation of Net Assets in the Balance Sheet" (Accounting Standards Board Statement No.5, 2005/12/9) andthe "Implementation Guidance for the Accounting Standard for Presentation of Net Assets in the Balance Sheet" (Financial
Standards Implementation Guidance No.8, 2005/12/9).

Net Sales

0.09(Thousands of
U.S. dollars)(Yen)

Net income per share (loss)

663,153
16,436
4,252
648,715
249,973

(¥)

101.9
25

25

23

3.4
3.4

21

21
64.1

20

67.6
66.5

18
17

58
47
1.0
0.9

18.9
16.6

0.5
0.4

10.9
8.6

-1.0
-1.4
'04

'05

'06

'07

'08

'04

'05

'06

'07

-20.6
-27.9
'08

'04

'05

'06

'07

'08

'04

'05

'06

'07

'08

Annual Report 2008
SHIBAURA MECHATRONICS CORPORATION01

To Our Shareholders

Shibaura Mechatronics, as the “Infrastructure Provider of theDigital Age”, offers manufacturing equipment for flat panel displays, semiconductors optical discs and other essential electronic components. As a provider of infrastructure supporting
digitization and a networked society, we are contributing to theachievement of an affluent society.
In promoting business, we have adopted “Innovation in All
Things”, “Pursuit of Rationality” and “Respect for Humananity”
as Corporate philosophy for our corporate activities. As westrive to become an energetic global corporate group, able andready to respond quickly to changing circumstance, we will
ensure that this philosophy permeates the group.

SHIBAURA MECHATRONICS CORPORATION
President and chief Execuvite Officer

Through our business we contribute to society. We havedefined “contribute to the achievement of an affluent life byoffering superior technology and services” as our management
philosophy, and we believe it is essential to fully understandand promptly respond to customers’ demands and rapidlychanging needs, and to thoroughly implement priority measures. We make sure that all employees share ownership of thismanagement vision, define objectives that must be achieved,
and assign and assure responsibility for results through thepractice of commitment management. As we promote efforts
to realize our business visions, we also make sure of compliance with rules and observance of fair corporate activities.

Kenji Minami
Results for FY ending March 2008
There was increasing uncertainty about the future of theJapanese economy in the fiscal year ending March 2008, driven by the impacts of rising prices for crude oil and raw materials, and by the worldwide financial turmoil triggered by the subprime loan issue. In these circumstances, the market for electronic devices was relatively buoyant, as demand remained
strong for digital home appliances, including personal computers, mobile phones, large-sized FPD TVs, portable music players, all of which expanded into emerging markets. In the LCD
panel business, our main customers, LCD panel manufacturers
in overseas markets postponed planned capital expendituresduring the first half of the fiscal year to March 2008. However,02

Annual Report 2008
SHIBAURA MECHATRONICS CORPORATIONTo Our Shareholders

we saw increased investment on equipment for large-sizedpanels in the latter half of the term, both in Japan and overseas. The semiconductor industry was less confident. Whilesome NAND flash memory manufacturers remained positive,
price declines in DRAM had a negative impact, especially on
manufacturers of logic devices, and the industry saw weaker
capital investment.
In this business environment, Shibaura Mechatronics Group
continued to maintain a basic policy of “realize high profitability
by reinforcing product appeal and overall productivity” and promoted business and production activities to secure profit.
As a result, for the fiscal year ending March 2008, we recorded
consolidated sales of 66,441 million yen, an 11% decrease
from the previous term, operating income of 1,646 million yen,and net profit of 426 million yen. We have decided to pay anannual dividend of eight yen per share, a one yen increase fromthe previous term.

Future Outlook
In the LCD panel business, we expect to see continuation of
the positive mood of the latter part of fiscal year 2008, andcontinued active capital investment in Japan, South Korea andTaiwan during the fiscal year ending March 2009. In the semiconductor business, we expect capital expenditure on NAND
Flash memory and logic to remain steady in the first half of theyear, and we anticipate a recovery in market conditions in2009. In the optical disc business, thanks the resolution of thenext generation DVD standard, investment in Blue-ray Discs is
expected to increase. In the battery industry, where we see
tremendous growth potential, we look forward to increasing
significant roles for solar batteries, secondary batteries and fuelcells.
In these market conditions, Shibaura Mechatronics Group will
promote business expansion by moving into new growth areas,such as batteries, alongside our businesses in flat panel displays, semiconductors and optical discs. We will also implement measures to strengthen cost competitiveness and manu-

facturing and to enhance procurement capabilities, in order tosecure profit.
Looking more closely at particulars, guided by our mid-termbusiness plan for the three years from the fiscal year ending
March 2009, we will steadily carry out the measures outlined
below, as means to improve profitability, asset efficiency andshareholder value. We will aim to achieve an ROA (return on
assets) of 10% and ROE (return on equity) of 15% in the fiscal
year ending March 2011.
1. Expand the semiconductor business
2. Improve profitability in the liquid crystal display business
3. Expand the vacuum and laser businesses
4. Expand the inkjet business5. Develop new businesses
6. Reinforce productivity and procurement
7. Reinforce price and cost competitiveness8. Reinforce product appeal and development capabilities
9. Develop and deploy capable human resources
10. Reinforce internal controls and CSR
Further to this, and toward strengthening our overall structure,
we initiated a business reorganization on April 1, 2008. We
established an Ink-jet Business Product Promotion Team toaccelerate the expanding application of use of inkjet technology
to LCDs and semiconductors. We also merged the Electronic &Vacuum Systems Division with the Laser Systems Division,
toward achieving a synergy between our vacuum applicationtransfer technology and laser process technology. Through thissynergy effect, we propose to strengthen the System
Equipment business in such areas as solar batteries and secondary batteries.

CSR Management
We promote CSR activities from the perspective of what weshould do for the future based on the guiding principles of ourcorporate behavior. We constantly consider the role that weought to play through our communication with our stakeholders, and strive to reflect such considerations in our management.

Annual Report 2008
SHIBAURA MECHATRONICS CORPORATION03

To our Shareholders

In order to address and help to mitigate global environmental
issues, we have established an “Environmental Charter.” Wepromote sound environmental activities in our business and in
our products, aiming to improve resource productivity and environmental efficiency, but more than this we believe it is essential to define a long-term plan that allows us to achieve effective
results that contribute to countering the acceleration of climatechange. In order to secure sustainable development which
implies meeting that meets the needs of the present generation
without compromising the ability of future generations to meettheir own needs, we have a responsibility for reaching a balance between comprehensive corporate activities and therequirements of the global environment. In order to fulfill our
responsibilities, we must proactively consider the nature of our
future corporate activities and, as a maker of manufacturing
equipment, utilize our technology, our know-how and our experience. Furthermore, we believe that CSR activities will be completely rooted in the company when our employees actively
engage themselves in the CSR that the Group aims for, andbring an awareness of CSR to the conduct of day-to-day business. We encourage our employees to think for themselves, totake action, and to achieve personal growth, an approach werefer to as “CSR that activates people”.

Toward Achieving New Growth
Shibaura Mechatronics operates in a business environment
where it is not easy to forecast the future with any confidence.
Business in the area of electronic devices, including semiconductors, flat panel displays and optical discs, all face fierce
competition in a market that can change very quickly. However,these are also the businesses that provide the basis for many
current industries and the IT society, and they are all expected
to see continued growth and expansion. Building on corecapabilities that we have built up over many years, we constantly seek to strengthen our technological capabilities in
products and manufacturing, and to produce excellent products in a short time at low prices. We also value positive relations with our business partners that allow us to promote business together, and to provide our customers with new value.
Through this approach, we aim to continue to grow our busi-

04

Annual Report 2008
SHIBAURA MECHATRONICS CORPORATION

nesses.
As we do so, I very much hope that we may continue to rely on
the support and encouragement that our shareholders andinvestors have extended to us for so long.
October 2008
Kenji Minami
President and CEO

Topics

New Products
New products that we have brought to market during the course of theyear include the following.

LCDs
LCD manufacturing equipment compatible with large glass substrates
New wet processing equipment that brings together Shibaura
Mechatronics’ long-cultivated know-how and expertise in wet process
technology to reduce our customers’ COO (cost of ownership).

High efficiency manufacturing
single wafer type wet processor
SC300GX III

Semiconductors
SC300GX III: High efficiency manufacturing single wafer type
wet processor
Highly efficienct manufacturing equipment that saves space and supports miniaturization of flash memory. This equipment offers the industry’s highest level of productivity, even as it achieves a smaller footprint.

High Precision Die Bonder
FTD-7000

FTD-7000: High Precision Die Bonder
The perfect die bonder for multi-level packages such as flash memories and System LSI
TFC-5500: Ultra High-Speed Flip Chip Bonder
The optimum equipment for RFID and other small chips, offering compatibility with the ultrasonic process and high level production efficiency.

Ultra High-Speed
Flip Chip Bonder
TFC-5500

High Precision
Flip Chip Bonder for COF
TFC-3200

TFC-3200: High Precision Flip Chip Bonder for COF
Optimization for FPD driver packages assures the achievement ofhigh-level precision combined with high productivity.

Media Devices
Dual layer transcription equipment for BD-ROM dual layer discs
This equipment’s utilization of a metal stamper during the Blu-Ray disc
manufacturing process achieves dramatic cost reductions.

Solar Battery FieldThin film solar battery manufacturing equipment
We have brought to market laser patterning equipment for the thin film
silicon solar battery panel manufacturing process.

Dual layer transcription equipmentfor BD-ROM dual layer discs

Thin film solar battery
manufacturing equipment

Annual Report 2008
SHIBAURA MECHATRONICS CORPORATION

05

Financial Review

Business at a Glance

Segment Information

In the fiscal year ended March 2008, the market for digital consumer products, including LCD TVs, PCs, mobile phones andportable audio players, continued to expand, while some LCD
and semiconductor manufacturers reviewed their capital investment plans in the face of price erosion and a deteriorating supply and demand balance in LCD displays and memory devices.

1. Fine Mechatronics Segment
Segment sales decreased by 19.6% from the previous fiscal
term to 47,559 million yen, while operating income
increased by 2,966 million yen to 587 million yen.

In the LCD panel business, Shibaura Group’s major customer,some foreign panel manufacturers postponed capital investments. Despite this, the second half of the fiscal year saw capital investments in large-sized panels and other areas enter amore aggressive phase, both at home and overseas. In thesemiconductor industry, capital investment for NAND flash
memory remained steady, supported by continued demand
growth for digital consumer products. However, investments inlogic and LCD driver ICs were sluggish.

Sales of LCD manufacturing equipment, including cleaning
equipment, decreased against the previous fiscal year in the
Taiwanese and Korean markets. However, a more active
investment environment emerged in the second half andorders increased. Among our core products, PI ink jetcoaters for larger LCD panels saw a better performance in
Taiwan and Korea. Demand for outer lead bonders for largesized LCD TVs and monitors turned in a solid performance,
and we were able to deliver those products to a broader
geographical area, including Eastern Europe and Latin
America.

As a result of the foregoing, sales against the previous fiscal
year decreased by 11.0% to 66,441 million yen, operating
income increased by 3,276 million yen to 1,646 million yen,ordinary profit saw increased by 3,209 million yen to 1,481 million yen, and net income increased by 1,473 million yen to 426
million yen.

In semiconductor manufacturing equipment, demand forsingle wafer wet cleaning equipment for 300mm wafers andfor wafer inspection equipment remained steady. However,sales of dry process equipment were stagnant, reflecting
restrained capital investment in logic ICs. Bonding equipment saw lower sales also under the impact of limited

Net Sales

Operating Income(¥Billions)

Sales by Segment(¥Billions)

Overseas Sales by Region(¥Billions)(¥Billions)

8.8

45.2

88.5

88.5

74.9
74.9

74.7

67.5

74.7

67.5
66.4

66.4

32.9

32.3
29.6

5.2

22.8
3.2
1.6

'04
-1.6
'04

06

'05

'06

'07

'08

Annual Report 2008
SHIBAURA MECHATRONICS CORPORATION

'04

'05

'06

'07

'08

'05

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'07

'08

Fine mechatronics
Electronic & vacuum equipment
Vending machines & systems
Real estate leasing

'04

'05

'06

'07

'08

※Major countries or regions includedin each geographical area :Northeastern Asia-Taiwan,
Korea, China
Ohi USA M i

Financial Review

steady, reflecting growing demand for ticket vending
machines compatible with contactless IC cards to meet thewidespread use of the electronic payment cards.

investment in the LCD driver IC market.
2. Electronic & Vacuum Systems Segment
Segment sales increased by 0.6% from the previous fiscal
term to 9,588 million yen. Operating income decreased by
172 million yen to 146 million yen.
In the media device manufacturing equipment field, demand
for sputtering equipment and dual layer transcription equipment for Blu-ray Discs (BD-ROM) for games and high-definition video increased, resulting in sales growth. Also in thevacuum equipment field, vacuum bonding equipment saw asignificant sales increase as a result of higher demand formobile displays. In the laser business, equipment for thin silicon soler battery panels saw a substantial increase indemand.
3. Vending Machines and Systems Segment
Segment sales increased by 78.2% from the previous year
to 7,470 million yen. Operating income increased by 782
million yen to 885 million yen.
Sales of cigarette vending machine increased as a result of
the 2008 introduction of an integrated adult verification function. Overall, the ticket vending machine business remained

ROA

(%)

ROE

(%)

4. Real Estate Leasing Segment
Sales totaled 1,823 million yen, remaining largely the sameas in the previous year. Operating income decreased by 113
million yen from the previous year to 608 million yen.

Research and Development Expenditure
Research and development expenditure by Shibaura Group asa whole in the fiscal year under review stood at 3,184 million
yen. This includes 581 million yen for the development of coretechnologies common to Group companies.
Proactive R&D activities range from basic technology to product development, and involve the Company’s corporate R&D
department, the development and design departments in operating divisions, and consolidated subsidiaries.
Research activities and results and R&D expenditure in eachsegment are described below:

DOE

(%)

D/ E Ratio

(%)

1.8
10.4

25.1
1.6
6.7

79.7

1.5

1.5
13.4

55.8

1.4

3.1
2.1

5.6

45.9

44.7

'07

'08

1.7
35.7
-4.0

-2.3

'04

'05

'06

'07

'08

'04

'05

'06

'07

'08

'04

'05

'06

'07

'08

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Annual Report 2008
SHIBAURA MECHATRONICS CORPORATION

07

Financial Review

1. Fine Mechatronics Segment
Development work for LCD manufacturing equipment covered the wet process equipment, cell assembly equipment
and PI ink jet coaters, in readiness for next generation larger
glass panels, and outer lead bonders for large-sized LCD
TVs. Development work for semiconductor manufacturing
equipment covered cleaning equipment, etching equipment,
ashing equipment, wafer inspecton equipment for next generation devices, and high-speed, high-precision flip chipbonders.
2. Electronic & Vacuum Systems Segment
Development work for media device and vacuum equipment
covered sputtering equipment and dual layer transcription
equipment for Blu-ray Discs, photocatalyst sputtering equipment, vacuum bonding equipment for mobile displays, andsputtering equipment for semiconductor backside contacts.
For laser equipment, development work covered high-output fiber lasers, laser welding equipment for batteries forvehicles and thin filmsolar energy panel manufacturing
equipment.
3. Vending Machines and Systems Segment
Development work for vending machines and ticket vending
machines covered advanced software for cigarette vending

R&D Expenditures

Facilities Expenditures(¥Billions)

machines with a built-in adult verification function, development of replacemet parts to for installed cigarette vending
machines, and new model introductions in the thin model
series of ticket vending machines (incorporating LCD displays, etc.).

Financial Condition
Total assets at the end of the fiscal year amounted to 64,994
million yen, a decrease of 8,202 million yen from the previous
fiscal year-end. Current assets decreased by 6,921 million yen
from the previous fiscal year-end to 45,845 million yen. Thiswas primarily due to a sharp drop in notes and accounts
receivable and inventories. Fixed assets decreased to 19,149
million yen, a decrease of 1,281 million yen from the end of theprevious fiscal year, primarily due to the depreciation of tangible
fixed assets.
Total liabilities at the end of the fiscal year were 39,949 million
yen, 8,162 million yen lower than at the end of the previous fiscal year. The primary reason for this was a decrease in notes
and accounts payable and accounts payable on infrastracture
in current liabilities.
Total net assets at the end of the fiscal year stood at 25,044

Number of Employees

Free Cash Flows(¥Billions)(¥Billions)

3.5
3.2

1,735 1,744

7.2

1,802

2.9
2.7

1,486
2.4

2.4

2.3

5.1
1,441

3.7

1.3
1.6
1.4

1.3

-5.7
'04

08

'05

'06

'07

'08

Annual Report 2008
SHIBAURA MECHATRONICS CORPORATION

'04

'05

'06

'07

'08

'04

'05

'06

'07

'08

'04

'05

'06

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Financial Review

million yen. The underlying reason for this was a decrease in
the divident surplus and valuation and translation adjustments.

Cash flow from investing activities decreased by 1,612 million
yen，a result of expenditure on the acquisition of tangible fixed
assets.

Cash Flow
Total cash and cash equivalants at the end of the fiscal year
sttod at 9,059 million yen, an increase of 849 million yen fromthe end of the previous year. This growth includes 188 million
yen from the increase in the number of consolidated subsidiaries.

Cash flow from financing activities decreased by 637 million
yen. The primary reason for this was repayment of short-termbank loans and payment of dividends.

Cash flow from operating activities increased by 2,917 million
yen. The primary reasons for this increase were lower debt payments, net income before income taxes, fewer accounts
receivable and inventory reduction.

Five-year SummaryYear ended March 31,

2008

2007

2006

2005

2004

(Thousands of
U.S. dollars)(Millions of yen)

Consolidated
Net sales
Cost of sales
Operating income (loss)
Income (loss) before income taxes
Net income (loss)

Year ended
March 31,2008

¥ 66,441
52,070
1,647
1,482
426

¥ 74,663
65,322(1,630)(1,727)(1,047)¥ 74,913
58,015
5,180
5,752
3,393

¥ 88,513
67,492
8,824
8,260
5,134

¥ 67,521
54,308
3,168
1,958
979

$ 663,153
519,714
16,436
14,7884,252

Depreciation and amortization
R&D expenses

1,245
3,184

1,165
2,713

1,133
2,851

1,255
2,337

1,756
1,415

12,427
31,780Total assets

64,99573,19775,15170,411

69,245648,715

Net assets

25,04525,084

27,67022,791

18,091

249,973

8.62¥ (20.60)

1,802

1,744

(Yen)

Net income (loss) per share
Number of employees¥¥(U.S. dollars)

66.52¥ 101.92

1,735

1,441

¥

18.88
1,486

$

0.09
1,802

Annual Report 2008
SHIBAURA MECHATRONICS CORPORATION

09

Mid-term Business Plan

With full consideration for changes in domestic and overseas
economic trends and in the business environment, Shibaura
Mechatonics Group has drawn up a mid-term business plan
covering the years beyond the March 2009, with the intent onachieving an ROA (return on assets) of 10% and an ROE (returnon equity) of 15% by the end of March 2011.
Under this mid-term business plan, we aim to improve earning
capacity, asset utilization efficiency, and shareholder value
based on the policy “realize high profitability by reinforcing
product appeal and overall productivity.”

actively promote collaborations with major customers inorder to expand our market share in dry process equipment,
wet process equipment, and die attachment equipment.
2. Improving Profitability in the Liquid Crystal Display BusinessDespite active capital investment in large LCD TV, demandfor cost reductions continues to grow, driven by falling
prices of LCD panels. In this business environment, and toensure profitability, we will establish profitable operations byshifting from a growth-oriented strategy to focus on a profitoriented structure, make continuous efforts to reduce costs
and lead-times, and to reinforce our competitive edge
through a clear focus on strategic products.

In order to ensure profits while quickly responding to volatilebusiness environments and market trends in semiconductors,
liquid crystal displays, media devices and our other productareas, the Group intends to define clear business strategies,
see the issues from the perspective of our customers, andsteadily implement the measures described below as a means
to improve business processes.

3. Expansion of Vacuum and Laser BusinessWe merged the electronic and vacuum systems division andthe laser systems division on April 1st, 2008, with the objective of reinforcing our system equipment business in suchproducts as solar batteries and secondary batteries.

1. Expansion of the Semiconductor Business
Capital investment in semiconductors for digital home appliances continues. In these business circumstances, and with
the intent of expanding the semiconductor business, we will
introduce strategic new products into the market andWith the standardization issue now settled in the next generation DVD market, the Blu-ray disk is now expected to fully
prevail. Besides this, concerns for the impact of global
warming have spurred progress in solar power generation
have progressed, and we look forward to rapid expansion in

Net Sales
74.7

58.1

(¥Billions)

83.0

97.0

105.0 (Consolidated)Year ended March, 2007 → 2010

(CAGR)

345

40

66.4

47.1

Business Port Folio

67.0

80.0

87.0
(Non-consolidated)

Ordinary Income(¥Billions)30

Media Device
187&
Vacuum Business(%)

Semiconductor
Business
CAGR=35.1

CAGR=28.6

20
365

8.4

LCD Business

6.9

10

CAGR=13.7

4.1
-1.7

1.5

-2.8

0.7

'07

'08

0
3.7

5.5

6.6

'09

'10

'11

-10
0.0

+5

+10

+15

Operating income ratio (Increasing point)

10

Annual Report 2008
SHIBAURA MECHATRONICS CORPORATION+20

Mid-term Business Plan

the solar battery market. In this business environment, we
will make every effort to expand the scale of operations byincreasing our share in sputtering equipment for Blu-ray
discs through reinforced collaborations with major customers, introducing unique vacuum bonding equipment tomarket, and delivering processing equipment for thin-film silicon solar cells.

and to expand business further, we enhanced our production space to support large liquid crystal display substrates
and expansion of the semiconductor business in FY ending
March 2007. Thanks to the significant increase in production power, we will work on active capital investment in production equipment for large LCD panels and semiconductor, both at home and overseas.

4. Expansion of Ink-jet BusinessWe established the Ink jet Equipment Project Team on April
1, 2008, aiming to cultivate the market in the area of LCDs
and semiconductors, and to expand operations by reinforcing the product appeal of our ink-jet equipment.

In parallel with this, we are strongly promoting offshore procurement of parts and components by launching an overseas procurement department. We aim to win further cost
reductions by collaborating in a company-wide procurement
innovation promotion with our suppliers.

5. Launching New BusinessIn order to strengthen our business foundations for the midand long-term, we will cultivate new businesses in which we
can utilize our technology, in areas that are expected toenjoy future growth and expansion, and seek to foster andgrow businesses that have the potential to become next
generation core operations.

7. Enhancement of Cost Competitive Edge
Falling prices for digital home appliances are spurring
demand for price reductions in the selling prices of our manufacturing equipment. In order to achieve significant cost
reductions in equipment prices, we have taken measures toreduce initial manufacturing costs. Specific measures
include using 3D CAD to improve design productivity,
design AV, standardization, platform development, cost
reductions by offshore procurement of parts and units, andreduction in lead-times by improving business operation
processes. With these measures, we will advance delivery

6. Enhancement of Production and Procurement power
In order to win against intense competition from domestic
and overseas manufacturing and equipment manufacturers,

Percentage Sales (Non-consolidated)(%)

Sales by Segment(¥Billions)

Other

11

18
13

18

20

Semiconductor
manufacturing
equipment

19
21

22

31

Real estate leasing
Vending machines &5.5 systems
Electric & vacuum
17.3 systems
2.2

Media device
manufacturing
equipment・
Vacuum equipment

1.7
5.1
1.9
4.2
9.5

1.5
4.5

16.1

1.7
7.5

15.2

9.6

33

Fine mechatronics
FPD manufacturing
equipment

49
'07

37
'08

37
'09

36
'10

35
'11

59.1
'07

47.6
'08

61.8
'09

74.1
'10

80.0
'11

Annual Report 2008
SHIBAURA MECHATRONICS CORPORATION

11

Mid-term Business Plan

10. Internal Control, Enhancement of CSR
As a whole group, based on the management top policy, we
will implement internal control related to the financial reportsthat correspond to the Financial Instruments and Exchange
Law (Japanese version SOX law) that will come into effectfrom the fiscal year ending March 2009.

dates, and strive to improve product price competitivenessand profitability.
8. Strengthening Capabilities in Products and Development
We will deliver equipment that offers product competitiveness in each of our business segments, such as wet
processor, PI inkjet coater, and Outer lead bonder for large
LCD TVs in the liquid crystal display segment, high performance ashing devices, backside etching equipment, and highprecision die-bonders in the semiconductor segment, Bluray disc sputtering equipment in the media device segment,
and processing devices for thin-film silicon solar cells in thelaser segment.

As we enhance our capabilities, Shibaura Mechatronics
Group will also continue to enhance and promote Corporate
Social Responsibility (CSR) activities, as we firmly believethat CSR is the foundation on which a company sustains
and develops itself.

Future outlook

9. Use and Cultivation of Human Resources
Based on our recognition that employees are invaluable
resources, we develop the foundations whereby humanmaterials are transformed into human resources, focusing
on training personnel by enhancing our personnel and training systems and providing the education necessary for the
next generation leaders. Furthermore, as a company
involved in “monotsukuri,” the making of goods, we are
active in promoting in-house education designed tostrengthen manufacturing power.

Strengthen Financial Status

(%)

20

Sales to the LCD panel industry in the fiscal year ending March2009 are expected to increase, thanks to an upturn in orders
from the second half of the fiscal year ending March 2008, theresult of active investment in production equipment for large
panels in Japan, South Korea and Taiwan. In the semiconductor industry, NAND flash memory manufacturers and logic
manufacturer have held back on capital investment in the fiscal
year ending March 2009, market conditions are expected torecover in the fiscal year ending March 2010. In the optical discindustry, settlement of the next generation DVD standardization

Building Resources(¥Billions)

5.0
14.3

10
ROE

4.3

15.0

10.0

9.5

4,000

Facilities
4.0 Expenditures
3.5

4.5

3,000

3.5
3.2

8.4
3.0

5.6
ROA

2.7
R&D
Expenditures

2.1

2.4

3.1

2.4
2.1

2,000

2.0
1.7
0
-2.3

1,000
1.0

1,744

1,729

1,799

1,850

Employee
Headcount
1,888

'07

'08

'09

'10

'11

-4.0

-10

12

0.0
'07

'08

'09

Annual Report 2008
SHIBAURA MECHATRONICS CORPORATION

'10

'11

0

Mid-term Business Plan

issue has activated investment in manufacturing equipment. In
the solar battery industry, positive capital investment will continue and sales are expected to increase. In the automatic vending machine business, the full introduction of vending machineswith built-in age verifiers will reduce demand for cigarettes
vending machines, but demand for ticket vending machines
offering support for contactless cards is expected to increase.
Shibaura Mechatronics Group will ensure implementation of its
mid-term business plan grounded in the basic policy of “realize
high profitability by reinforcing product appeal and overall productivity,” make every try to expand business in such growthareas as FPD, semiconductors, and solar cells, and work tostrengthen cost competitiveness, production and procurement
power in order to secure profit.

Annual Report 2008
SHIBAURA MECHATRONICS CORPORATION

13

Busines Overview

Fine Mechatronics Segment

Flat Panel Display
Manufacturing Equipment
Main Products- Cleaning Equipment- Stripping Equipment- Developing Equipment- PI Ink Jet Coater- Seal Dispenser- LC Drop Fill Equipment- Vacuum Bonder- Outer Lead Bonder

PI ink jet coater(¥Billions)

28.3

30.6

31.6

'10

'11

21.8

'08

'09

FPD manufacturing equipment
Net sales（Non-consolidated）

Seal dispenser

Outer lead bonder

14

Annual Report 2008
SHIBAURA MECHATRONICS CORPORATION

Busines Overview
Fine Mechatoronics Segment
Flat Panel display Manufacturing Equipment

Building a Profitable Business Structure
In the LCD business, investment in large-sized LCD panels is
active in Japan, Taiwan and Korea. However, demands forprice cuts in LCD panel manufacturing equipment continue tobe strong, under the impact of falling prices of LCD panels. We

In liquid crystal drop fill/bonding equipment, we will apply
our high precision filling technology of minute liquid drops
for producing small to medium sized panels for portable andin-vehicle applications.

make every effort to ensure positive results profit through concentrated efforts to restore profitability, including cutting costs
through standardization and reducing lead times, and reinforcing product appeal.

3. Module Process Equipment
By bringing to market a new product offering the high speed
and high precision necessary to meet increasing demand for
LCD TVs, we will seek to retain our No.1 share. Measures
will include the launch of strong line-up of outer lead bonder
for small panels (COG).

In addition, in an effort to enhance efficiency and to achieve therequired levels of product functionality and performance during
development of equipment for large-sized LCD panels, we perform event analysis and optimization by fully utilizing 3D-CAD in
design and simulations.

In America and in Europe, we will proactively strengthen ourservice capabilities in response to the opening of module
production facilities.

1. TFT/Color Filter Process Equipment
In the cleaning equipment business we face sharpening
competition, and higher cost competitiveness is our goal.
We promote unit standardization of development of equipment with selected functions, with the objective of achieving
cost reductions that will sustain a profit-based structure. In
addition, by applying the cutting-edge technology developed for eighth generation large-sized glass panels, we continue to develop manufacturing equipment for future, larger
generations.
We also aim to expand our market share in spin cleaning
equipment for technologically advanced low-temperaturepolysilicon LCDs and to apply that technology to OLEDs.
2. Cell Process Equipment
Panel manufacturers have already introduced our technologically advanced PI ink jet coater into their mass production lines. Building on this base, we will promote further
business expansion as our customers make capital investment in large-sized LCD panels. Going forward, we aim to
broaden the range of applications of the high precision coating technology based on the ink jet technology we developed for PI coating.

Annual Report 2008
SHIBAURA MECHATRONICS CORPORATION

15

Busines Overview
Fine Mechatronics Segment
Semiconductor Manufacturing Equipment

Fine Mechatronics Segment

Semiconductor Manufacturing
Equipment
Main Products- Etching Equipment- Ashing Equipment- Wafer Cleaning Equipment- Wafer Inspection Equipment- Die Bonder- Flip Chip Bonder

Ashing equipment(¥Billions)

34.5
30.5
22.3
14.0

'08

'09

'10

Semiconductor manufacturing equipment
Net sales（Non-consolidated）'11

Wet process equipment

Die bonder

16

Annual Report 2008
SHIBAURA MECHATRONICS CORPORATION

Busines Overview
Fine Mechatronics Segment
Semiconductor Manufacturing Equipment

Expanding Business Scale
In the semiconductor business environment, the main focus ison a steady expansion of investment in equipment for NAND
flash memory. At the same time, there is a continuing trend to
restrict investments in equipment for other types of semiconductors.
Shibaura Group intends to expand its semiconductor businessby winning increased share in NAND flash memory, where we
can expect to see continued investment in equipment. We willraise market share by strengthening our product line, introducing to the market such new products as high efficiency ashingequipment, high efficiency wet processing equipment and highspeed flip chip bonders.
We will also promote further expansion overseas, particularly in
Asian region, by strengthening the service capabilities of ouroverseas subsidiaries.
1. Dry Processing Equipment
In our high efficiency ashing equipment, we will first install an
evaluation equipment at customers’ site to get their interestin our products and get into the market and then achieveadvances in mass production. Cooperation with major
memory manufacturers allow us to establish the process

has a throughput of 420 sheets an hour, and besides wet
cleaning also covers the back side etching processes
included. We are also developing process applications fornext-generation devices.
Management of wafer edges has become an important concern in increase yields from wafer inspection equipment. We
are reinforcing our sales to major device manufacturers by
incorporating evaluation mechanisms into edge inspection
equipment for major device manufactures.
3. Assembly process Equipment
This in an area where we will secure a top share by introducing new flip chip bonders for LCD drivers that support
high speed mounting and manufacturing at finer pitches.
With memory-use die bonders, we will expand our shareamong major memory manufacturers by introducing to market new, high speed, high precision machinery supporting
the transition multi-layer and thin wafers. In addition, we will
enhance the versatility of flip chip bonders for microchips, ICtags and other new packages by incorporating high-speed,
highly efficient manufacturing evaluation equipment.

and we are now expanding business though highly efficientmanufacturing, high level reliability and low COC.
We are building our installation records of the insulation layer
etching equipment by putting them for the CMOS sensor
process. In developing miniaturization technologies essential
for next generation devices, we are introducing evaluationequipment for chemical etching equipment and working withour customers to assess the process and drive forward
progress.
2. Wet Processing Equipment, Inspection Equipment
Our strategy for the high-efficiency wet processing equipment is ,first to get orders from a major memory manufacturer and then increase sales. Our single wafer equipment

Annual Report 2008
SHIBAURA MECHATRONICS CORPORATION

17

Busines Overview
Electronic & Vacuum Systems Segment
Media Device and Vacuum Equipment

Vacuum Technology Creating New Value

Electronic & Vacuum Systems Segment

Media Device and Vacuum
Equipment

Restrictions on equipment had continued by the delay of standardization of the next generation DVD (whether it would be
HD-DVD or Blu-Ray), but now that the optical disc industry has
decided on Blu-Ray as the disc format, demand is expected toincrease and with the forthcoming transition to digital broadcasting.

Main Products- DVD Sputtering Equipment- Vacuum Bonding Equipment

Also, advances in enhancing the capacity of Blu-Ray Discs
have fueled increasing demand for manufacturing equipment
for 50GB dual layer discs. Production of such dual layer discs
requires the ability to form a highly uniform reflective film, a middle layer, and transcription pattern structuring technology. We
provide high quality manufacturing equipment for this process.

(¥Billions)

12.0

13.1

10.0
6.3

'08

'09

'10

Media device & Vacuum equipment
Net sales（Non-consolidated）

Replication line for Blu-Ray disc18

Annual Report 2008
SHIBAURA MECHATRONICS CORPORATION'11

In the vacuum bonding field, demand for excellent, high visibility
displays used in touch panel of PDA has grown, and with it
demand for the manufacturing equipment used in their production. Our high level bubbleless vacuum bonding technology
makes it possible to manufacture high quality displays.
Beyond this, we are also introducing to the market high quality,
highly efficient photocatalyst sputtering equipment for automobile components, and sputtering equipment for backside electrode discrete semiconductor wafers.

Vacuum bonding equipment

Busines Overview
Electronic & Vacuum Systems Segment
Laser Equipment

Entering the Clean Energy Field

Electronic & Vacuum Systems Segment

Laser Equipment

Recent years have seen the recognition of global warming as
an issue and rising awareness of environmental concerns, stimulating demand for solar batteries. Shibaura Group provides
lasers for thin film silicon solar battery systems, an area where
we anticipate future demand growth. We have also seen
increased demand for new types of batteries for use by theautomobile industry in hybrid cars, and demand for high-quality
laser welding equipment is expected to increase along with
this.

Main Products- Laser Markers- Laser Welding Equipment- Solar Energy Panel Manufacturing Equipment(¥Billions)

5.2

5.5

5.6

'10

'11

2.5

'08

'09

In addition to the Group’s businesses in manufacturing equipment for flat panel displays, semiconductors, and electronic
components for parts of mobile phones, we are focusing ourattention on the clean energy business and thin film solar batteries and new types of car batteries. Utilization and development of the Group’s strengths assures that we can differentiate
ourselves from our competitors in such areas as large-scale
substrate transportation technology, precision positioning technology, integration of factory line automation technology andthe system equipment business.

Laser equipment Net sales (Non-consolidated)

Solar energy panel manufacturing equipment

Annual Report 2008
SHIBAURA MECHATRONICS CORPORATION

19

Busines Overview
Vending Machines and Systems Segment
Cigarette Vending Machines
Ticket Vending Machines

Advancements in response to Contactless IC Cards

Vending Machines and Systems Segment

Cigarette Vending Machines
Ticket Vending Machines

Recent years have seen the recognition of global warming as
an issue and rising awareness of environmental concerns, stimulating demand for solar batteries. Shibaura Group provides
lasers for thin film silicon solar battery systems, an area where
we anticipate future demand growth. We have also seen
increased demand for new types of batteries for use by theautomobile industry in hybrid cars, and demand for high-quality
laser welding equipment is expected to increase along with
this.

Main Products- Cigarette Vending Machines- Ticket Vending Machines（Food Tickets, Admission Tickets）(¥Billions)

7.5

4.5

'08

'09

5.1

'10

5.5

In addition to the Group’s businesses in manufacturing equipment for flat panel displays, semiconductors, and electronic
components for parts of mobile phones, we are focusing ourattention on the clean energy business and thin film solar batteries and new types of car batteries. Utilization and development of the Group’s strengths assures that we can differentiate
ourselves from our competitors in such areas as large-scale
substrate transportation technology, precision positioning technology, integration of factory line automation technology andthe system equipment business.

'11

Cigarette & Ticket vending machines
Net sales

Cigarette vending machinewith an age verification function

20

Annual Report 2008
SHIBAURA MECHATRONICS CORPORATION

Ticket vending machine
for a non-contact IC cards

Corporate GovernanceFundamental Approach to Corporate GovernanceShibaura Group defines corporate governance as a key management function for developing corporate value with shareholders, customers, employees and society and for a medium to long - term perspective. We are all of us - the company's
executives and offices, all employees - responsible for implementing measure that will build corporate value, and we must
all ask and clarify, "What is required of us ?" and "What should
we do ?" in respect of the law, social norms, ethics, and thelike, and as the basis for compliance and risk management andfor drawing up and applying the "Shibaura Group Code of
Conduct".

(2) The corporate auditing system currently comprises four
corporate auditors, all from outside the company, who arecharged with further reinforcing corporate governance. Twoof the corporate auditors are full-time, able to conductproactive audits and to work in close cooperation with thepart-time auditors. The auditors receive advance briefings
on matters concerning the board of directors, and are able
to play a positive role in bringing matter to the board's
attention.
The corporate auditors and financial auditors cooperate
closely to develop and plan audit-related policy and objectives, through such means as information exchanges andprior consultation.
The corporate governance system is shown in the illustration below.

Enforcement and Oversight of Corporate Decision
Making and the Business Management Structure
and Other Aspects of Corporate Governance(1) The board of directors currently has 12 members. Outside
directors are not elected. The company recognizes theneed for outside directors who are not captive to the company's internal logic, who are able to draw on their experience to offer an independent, objective perspective. Goingforward, we propose to identify suitable candidates tobecome outside directors and to propose them to the general meeting of the shareholders.

(3) Management Audit Division is organized under the directcontrol of the CEO and is responsible for auditing management. Its mission centers on monitoring management
appropriateness. The audit function also includes anotheraspect : auditing for compliance with laws and regulations
by a certified public accountant (independent auditor).
Beyond this, each individual section also carries out its own
audit of operations, under the guidance of Management
Audit Division.

We also intend to examine measures for further strengthening corporate governance, in order to implement optimized
policy on management administration (including the size of

The corporate auditors and Management Audit Division,
responsible for internal auditing work in close cooperation
to define audit objectives, plans, et cetera, and the head ofManagement Audit Division ensures that audits are

the board and introducing the executive officer system).

Shareholders' Meeting
Appoint / Dismiss

Board of Directors
Directors

Appoint / Dismiss
Statutory
Audit

Board of Auditors
Auditors

Accounting Auditor

CEO

Each Operating DivisionInternal Audit

Internal
Auditing

Management
Audit DivisionCorporate governance system
Annual Report 2008
SHIBAURA MECHATRONICS CORPORATION

21

Corporate Governanceremuneration.

enforced and that the results are reported to the corporate
auditors. In addition, the head of Management Audit
Division is to be appointed with prior consultations between
the corporate auditors and the company.

Basic Approach to and Maintenance of the Internal
Control System
Shibaura Mechatronics deploys an internal control system thatis centered on legal compliance and risk management, plus
management efficiency. We continue to introduce policy measures to strengthen the internal control system (establishing official rules, comprehensive education, strengthening audit systems, information management and the like), and to make it the
bedrock for further improvement.

(4) At present, policy on providing incentives to directors of thecompany is being considered what kind of incentive is tocontribute not restricted to short term performance, but tobe continuously contributions to improve performance inthe medium to long term.
(5) Remuneration paid to directors is periodically disclosed in
the business reports and the Financial Statement, as a sum
total.

In addition, the following has been decided in respect of thesystem to ensure that directors carry out their duties in conformity with laws and regulations and the company's articles ofincorporation, and the system to assure the efficient performance of directors in carrying out their duties.

(6) General Affairs Division provides the outside directors witha support organization. In addition, the division provides thefull-time auditors with briefings prior to meetings, as necessary, and is dedicated to assuring a structure where there
is no deficiency in the provision of information.

(1) System in order to ensure that directors carry out theirduties in conformity with laws and regulations and the company's articles of incorporation.

(7) The management strategy meeting, in addition to the meeting of the board of directors, is held once a week in principle, with a membership comprising the CEO and executive
directors, as well as the directors responsible for management corporate planning, marketing & sales, technology,
production & procurement, finance & accounting and general affairs, and shall discuss and make decisions on mat-(a) The board of directors, as specified in the regulations
for meetings of the board of directors, meets every month,
as a general rule.
(b) The head of Management Audit Division develops andplans audit-related policy and objectives, in close cooperation with the corporate auditors, and also enforces internal
audits by ensuring that all departments carry out audits ofters related to such functions as management of business,
auditing and supervision, nomination, and decisions on

CEOSignificant Crisis Risk
Response Organization
Risk Management
Committee

Report / Direct

CRO

DirectCrisis Risk Information

General Crisis Risk
Response Organization

Risk Compliance
Committee

Supervising Division :General Affairs Division
Report / Direct

Management Audit Division

Board of Auditors

Direct"Risk Consultation Hotline"

DirectRisk Owner

Risk Information

Risk Information
Risk Information

Employee

Corporate management system

22

Annual Report 2008
SHIBAURA MECHATRONICS CORPORATION

Audit

Corporate Governancetheir operations in the same way.
(2) System for preserving and managing information used bydirectors in carrying out their duties.
Important documents used by directors in carrying out theirduties (minutes of major meetings, documents granting
approval, contract documents, confidential documents andall applicable electronic media), must be preserved andmanaged pursuant to company regulations (Documents
preserving regulation, Confidential information managing
basic regulations, etc.) in an appropriate manner.
(3) The regulations in respect of managing the danger of a loss
and other systems.
Observing the risk management regulation, risk management systems for normal times (identify and analyze (business) risk, develop and deploy countermeasures, train
employees, make internal reports) and times of emergency(establish Risk Management Committee, centralize information to the Chief Risk Officer, etc.) must be made for preventing or minimizing any damage, and for the reasonabledisclosure of information.
(4) System to guarantee the efficient performance of directors
in carrying out their duties.
(a) Meetings of the board of directors shall be held at aregular time every month, and also be held in recognition of
the need for timeliness.
(b) In order to achieve rapid decision-making and optimized business operations, and to observe rules on final
decision-making authority, CEO and executive directors, aswell as the directors responsible for management corporate
planning, marketing & sales, technology, production & procurement, finance & accounting and general affairs, will, asa general rule, hold a weekly meeting of management strategy meeting, to deliberate on and make decisions.
(c) Specialized meetings related to deliberating and reporting on the following management matters, the budget,business, manufacturing, development and design, andothers, will be held every month, as a general rule.
(d) The decisions made by the final decision-making
authority including the meetings of the board of directors
shall be undertaken pursuant to organization regulations,
regulation of division of duties and managerial responsibilities, and assuring observance of regulations in undertaking
all professional duties and the appropriate performance ofbusiness management.
(5) System to guarantee conformity with laws and regulations
and the articles of incorporation by employees carrying out
their responsibilities.
(a) The CSR Committee is responsible for taking concrete
action to promote thorough penetration of and systematic
compliance with management ethics and laws and regulations. Further to this, the Shibaura Group Code of Conduct
has been established to provide group companies with ethical standards in their business activities, and the content
should be made familiar to all employees through training.
(b) In addition to distributing information through theorganization, early detection of problems and an appropriate response making use of an internal report procedure(include a risk consultation hotline for any necessary consultation with a lawyer) should be achieved.
(6) System to ensure business operations appropriate for a
public company by the business group comprising the parent company and its affiliated companies.
(a) The Shibaura Group Code of Conduct shall apply to all
the the affiliated companies and should be made familiar to
all the employees.
(b) Shibaura's Management Audit Division also oversees
management audits at the affiliated companies.
(c) In order to supervise the management performance of
the affiliated companies, managers from the Company may
be appointed to serve as part-time directors.
(d) Both domestic and overseas affiliated companies must
implement and abide by regulations regarding business
management (matters requiring prior approval by or that

Annual Report 2008
SHIBAURA MECHATRONICS CORPORATION

23

Corporate Governancehave to be notified to the parent) pursuant to Domestic affiliated companies and Overseas affiliated companies
respectively.
(7) System by which auditors carrying out their duties and who
seek assistance can assure the assistance of an appropriate assistant.
(a) Management Audit Division and General Affairs Division
support the auditors carrying out their duties.
(b) When auditors seek assistance carrying out their duties,
an assistant shall be selected from an appropriate department, in consultation with the auditors.
(8) The independence of the assistant referred to above fromdirectors of the company.
The assistant referred to in (7)(b) above shall be treated as
full-time staff, subject to oversight by the auditors, and shallnot carry out other assignments concurrently.
(9) The system for reports to the auditors by directors andemployees and the system for reports to the other auditors.
(a) In the event that directors, the CRO and the head ofManagement Audit Division discover, in connection with aninternal audit, any material items that will impact on performance or any actions that represent serious breaches oflaws and regulations, they shall, without delay, inform thecorporate auditors.
(b) The auditors shall be allowed to attend management
strategy meetings and other important meetings, and committee meetings.
(10)System to further ensure the practical effectiveness ofaudits by the auditors.
(a) The president shall, at certain intervals, exchange information with the auditors.
(b) The corporate auditors shall, at certain intervals,
exchange information with the independent auditors.

24

Annual Report 2008
SHIBAURA MECHATRONICS CORPORATION(c) The head of Finance and Accounting Division shall, at
certain intervals, exchange information with the auditors.
(d) The head of Management Audit Division shall submit areport to the corporate auditors in respect of the results ofinternal audits.
(e) The head of Management Audit Division shall be
appointed with prior consultations between the corporate
auditors and the company.

CSR Activities

CSR Management
We established the CSR Committee in April 2005. This movebrought a systematic approach to dealing with issues andactivities previously handled by individual departments andindependent committees. The CSR Committee drafts Groupwide plans related to promoting CSR, and assures promotionof CSR activities by providing direction and impetus for theactivities of Global Environment Committee, the Social & ES
(Employee Satisfaction) Activities Committee and the Risk
Compliance Committee.

Environmental Initiatives
The beginning of the Group's "Environmental Charter" states
that, "Shibaura Mechatronics Group, The Provider ofInfrastructure for the Digital Age, promotes business activities
with consideration for the environment, and offers environmentally conscious products on the global level". Furthermore, as amaker of manufacturing equipment, we exert every effort in thetwin aspects of our manufacturing systems and business systems, seeking to raise overall efficiency and to reach a higher
level in our environmental activities.

ronmental impacts from our business activities and to channel
the strengths of the Group into our Products, where we areworking to create environmentally conscious products. In thisrespect, it is essential to consider and reduce environmentalload throughout the product lifecycle, so works in product planning and designing phases are most influential. Guided by thisunderstanding, we have developed a "Product Assessment
Manual" that is applied to every step of the product planning,development and design process, in order to cut energy consumption, minimize use of resources, promote recycling rates,and otherwise reduce environmental loads.
One example of an environmentally conscious product is a die
bonder, which bonds an IC chip to the substrate in semiconductor manufacturing lines. This equipment has improved environmental efficiency (Factor) to 3.5 times compared with conventional models.

Across our operations, we promote measures to reduce envi-

Management
Audit Division

A new model (2007)

Report /DirectFactor 3.45

CEO
ReportValue improvement

Board of Directors
CSR Committee

High speed

Tact time is shortened by 50%(Max)compared with a conventional model.

High accuracy Accuracy is improved by 1.7times.

Board of Auditors
ReportEnvironmental improvement
Global warming prevention
Consumed electricity is cut by 56%
Effective use of resources
Compact designing reduced Equipment’s
footprint is reduced by 27%.

Global Environment
Committee

Social & ES Activities
Committee
CSR promotion system

Risk Compliance
Committee
Comventional model（2002）

Annual Report 2008
SHIBAURA MECHATRONICS CORPORATION

25

Board of Directors

Back row ;Front row ;Yukimasa Yoshida, Satoru Hara, Sennosuke Yoshida, Junichi Kanda, Masahiro Abe, Shunichi Kishimoto, Kazuo Takahashi, Masaaki Nomi,
Shuichi Shimada, Yoshiaki Sato , Shigeki Fujita
Hiroshi Hiraoka, Nobuyuki Yamaura, Kenji Minami, Mikio Haga, Ryoso Kawabe

Directors
President and Chief Executive Officer
Kenji Minami

Vice President
Kazuo Takahashi
Masahiro Abe

Executive Vice President
Mikio Haga
Nobuyuki Yamaura

Shuichi Shimada
Satoru Hara
Shigeki Fujita

Senior Vice President
Ryoso Kawabe
Hiroshi Hiraoka

26

AuditorAnnual Report 2008
SHIBAURA MECHATRONICS CORPORATION

Yukimasa Yoshida
Shunichi Kishimoto

Junichi Kanda
Masaaki Nomi
Yoshiaki Sato (Outside)
Sennosuke Yoshida (Outside)

Executive Adviser
Shigeki Morita

Investor Information
As of March 31, 2008

Date Established

October 12, 1939

Capital6,761Million-Yen

Number of Employees

Consolidated: 1,802

Non-consolidated: 985

Authorized: 100,000,000 shares

Issued and outstanding: 51,926,194 shares

Common Stock

Number of Shareholders

7,956

Stock Listings

The Tokyo Stock Exchange (Code : 6590)

Transfer Agent for
Common Stock

33-1, Shiba 3-chome, Minato-ku, Tokyo 105-8574, Japan

Independent Auditor

ERNST ＆ YOUNG SHINNIHON LLC

Headquarters

5-1, Kasama 2-chome, Sakae-ku, Yokohama, Kanagawa Pref. 247-8610, JapanThe Chuo Mitsui Trust and Banking Company, Limited

TEL : +81-45-897-2421

FAX : +81-45-897-2470

http://www.shibaura.co.jp/

Common Stock Price Range (The Tokyo Stock Exchange)
Year ended March 31,
High

(yen)

Low

(yen)

2008
824
388

2007
1,374
525

2006
1,759
864

2005
1,081
590

2004
985
409

Principal Shareholders
Number of shares holdToshiba Corporation
Japan Trustee Services Bank, Limited (trust accounts)
The Banc of New York GCM Client Account E L RG
The Banc of New York GCM Client Account JPRD ISG FE AC

Percentage of total shares
outstanding(thousand shares)(%)

18,977
1,456
1,024
863

36.5
2.8
2.0
1.7
Annual Report 2008
SHIBAURA MECHATRONICS CORPORATION

27

5-1, Kasama 2-chome, Sakae-ku, Yokohama,
Kanagawa Pref. 247-8610, Japan
TEL：+81-45-897-2421
FAX：+81-45-897-2470
http://www.shibaura.co.jp/

SEA0309A 00 0811
08023