Consolidated Business Performancefor the First Two Quartersof the Fiscal Year Ending March 2013
(Fiscal 2013)

Nov 7,2012

Results Briefing - Content
1. Consolidated Business Performance for theFirst Two Quarters of FY2013
2. Management Policies and Priority Issues
3. Important Fields for Technology

Development
4. Consolidated Full-Year Forecasts for FY2013

Nov 7,2012

TAIYO NIPPON SANSO Corporation1

Consolidated Business Performancefor the First Two Quarters of FY2013

Nov 7,2012

Consolidated Business Performance for the First Two Quarters of FY 2013
Billions of yen
Previous firsttwo quarters
Ratio to sales

Sales

234.7

(Announced targets)

228.0

Reporting firsttwo quarters(Results)

YoY change% change

Change fromannounced targets% change

228.2

-6.5

0.2

-2.8%

Operating
Income

15.7

Recurring
Income16.0

Net Income

Reporting first twoquarters

6.7%

6.8%

8.4
3.6%

12.5
5.4%

12.0
5. 3%

-7.5
-3. 3%

12.5
5.5%

12.0
5.3%

-7.9

-3.2

0.1%

0-20.3%-3.90%

0-24.8%

-16.3

0%

-0.4

-3.5%

Nov 7,2012

TAIYO NIPPON SANSO Corporation2

Performance by Segment

Nov 7,2012

Performance by Segment in FY 2013
Billions of yen

First two quartersof FY 2012
Sales

OperatingIncome

144.6

11.1

Electronics

56.1

EnergyOther

Industrial gases

MarginSales

OperatingIncome

7.7%

148.3

11.2

7.6%

3.1

5.6%

46.1

- 0.6

-1.3%

17.7

0.6

3.7%

17.4

0.7

4.4%

16.2

1.5

9.3%

16.3

1.7

10.8%

- 0.6

Adjustments

Total

MarginFirst two quarters ofFY 2013

234.7

15.7

- 0.6
6.7%

228.2

12.5

5.5%
Nov 7,2012

TAIYO NIPPON SANSO Corporation

3Industrial Gas-Related Businesses
Billions of yen

Operating Income

Sales
200

144.6

148.3+3.6 (+2.6%)

46.5

52.6+6.1＋6.1(+13.0(＋13.0%)%)10011.1

11.2

FY2012 Apr-Sept

FY2013 Apr-Sept+0.1 (+0.7%)

1095.798.0020－23(－2.4-2.3(-2.4%) %)FY2012 Apr-Sept
Japan

FY2013 Apr-Sept

0Overseas* The graph contains figures for both Japan and overseas sales.

Nov 7,2012

Major Industrial Gas-Related Businesses (Sales)
Separated Gases

58.4 +1.9 (+3.5%)

56.5

60

60

13.9

13.230

Other Gases

42.1+0.6 (+5.1%)＋6 (＋5.1%)

44.5

43.23014.9

FY2012 Apr-Sept
JapanFY2013 Apr-Sept
Overseas≪Overseas≫
Brisk nitrogen sales in NorthAmerica≪Japan≫
Driven by strong auto production,nitrogen and oxygen sales increase
Prices raised in Kanto region

038.8-3.2 (-7.6%)
13.8-1.1(-7.3%)(-7.3%)-1.1+1.3 (+3.0%)

25.0

27.1
0

Billions of yen-2.1(-7.8%)(-7.8%)-2.1

FY2012 Apr-Sept
Japan≪Overseas≫

FY2013 Apr-Sept
Overseas

Sales of acetylene, for which there wasspecial demand due to last year’s
carbide plant accident, were down inNorth America in FY 2013
≪Japan≫In 1st half FY2012, some consolidated
subsidiaries changed their accountingperiod, causing sales to increase
Demand for carbon dioxide decreased

Nov 7,2012

TAIYO NIPPON SANSO Corporation4

Major Industrial Gas-Related Businesses (Sales)
Cutting and Welding Equipment
and Materials

Gas-related Equipment, etc.

30

20

11.3

11.1 -0.2 (-1.3%)
2.1

2.5

10

15.1

11.1+4.0 (+35.8%)-0.4 (-17.3%)

10

9.0

8.7
0

24.6 +2.1 (+9.2%)

22.5

20

FY2012 Apr-Sept-1.9 (-16.8%)

0FY2013 Apr-Sept

9.5

11.4+0.3 (+3.4%)

Billions of yen

FY2012 Apr-Sept

Japan Overseas

JapanFY2013 Apr-Sept
Overseas≪Overseas≫≪Overseas≫

New consolidation effects
Sales of hard goods strong in NorthAmerica≪Japan≫In North America, sales of gas
supply equipment, etc. decreased≪Japan≫Sales of gas supply equipment andnumber of gas use equipment
reconstruction projects increased

In 1st half FY2012, some consolidated
subsidiaries changed their accounting
period, causing sales to increase
Welding material demand decreases

Nov 7,2012

Major Industrial Gas-Related Businesses (Sales)
Plants and Machinery

Billions of yen

10

5.6 +1.4 (+34.5%)

4.25

2.1

0.5+1.5 (+274.9%)

3.5

3.60

FY2012 Apr-Sept
Japan-0.1 (-2.3%)

FY2013 Apr-Sept
Overseas≪Japan・Overseas≫
Large construction projects proceeding smoothly
Decline in large projects in 1st half FY2013
Space simulation chamber projects increased

Nov 7,2012

TAIYO NIPPON SANSO Corporation5

Electronics-Related Businesses
Sales

56.1
504

3.1

46.1-10.0 (-17.8%)

15.5

12.5-3.0 (-19.3%)-0.6-3.7 (-119.2%)

33.6

40.60

Billions of yen

Operating Income-7.0 (-17.2%)

FY2012 Apr-Sept
Japan-1

FY2013 Apr-Sept

FY2012 Apr-Sept

FY2013 Apr-Sept

Overseas

Nov 7,2012

Major Electronics-Related Businesses (Sales)
2012.11040

11.3-0.7 (-6.3%)

0.6

0.4

11.4

10.9-0.2 （-34.1%)

FY2012 Apr-Sept
JapanFY2013 Apr-Sept
Overseas≪Overseas≫
Nitrogen and Argon sales decrease inNorth America≪Japan≫Argon sales decline on lower
production of silicon wafers

27.5

21.8-5.7 (-20.7%)

20

13.3

10.0-3.3 (-14.9%)

14.2-0.5 (-4.7%)0Billions of yen

Electronic Material Gases

Separated Gases

0FY2012 Apr-SeptJapan

11.8-2.3 (-16.8%)

FY2013 Apr-Sept
Overseas≪Overseas≫
Sales down after disposal of SDSbusiness≪Japan≫
Sales volume and value decline on
decreased production ofsemiconductors, LCD panels, and solarcells

Nov 7,2012

TAIYO NIPPON SANSO Corporation

6

Major Electronics-Related Businesses (Sales)
Electronics Related Equipment andInstallation

MOCVD Equipment

103

8.9

1.3
5

5.5-3.4 (-38.2%)
1.1

7.5

1.5-0.2 (-15.5%)

4.3
0Billions of yen-3.1 (-42.4%)
FY2012 Apr-Sept
Japan0FY2013 Apr-Sept

0.1
0.5

FY2012 Apr-Sept
JapanOverseas≪Overseas≫

0.9 +0.3 (+51.6%)

0.6

0.3
0.6+0.2 (+156.2%)+0.1 (+27.3%)

FY2013 Apr-Sept
Overseas≪Overseas≫

Equipment projects in North Americadecrease◆ Delivery to Taiwan LED manufacturer≪Japan≫≪Japan≫

Order from Japan LED manufacturer
Received UR26K order for power
semiconductors

Large equipment and installation
projects drop sharply

Nov 7,2012

Energy-Related Businesses
Sales
20

Operating Income

17.7

17.4-0.3 (-1.8%)

20.7

1

100.6

00
FY2012 Apr-Sept

FY2013 Apr-Sept

Billions of yen

FY2012 Apr-Sept+0.1 (+17.2%)

FY2013 Apr-Sept

Nov 7,2012

TAIYO NIPPON SANSO Corporation

7Major Energy-Related Businesses (Sales)
Equipment andInstallation, etc.

LP Gas30

Billions of yen

520

15.4 -0.4(-2.3%)

15.8

2.5
100

FY2012 Apr-Sept

0FY2013 Apr-Sept

1.2

FY2012 Apr-Sept

1.3 +0.1(+6.7%)

FY2013 Apr-Sept≪Japan≫≪Japan≫◆ Slight drop in order volume due toindustrial demand decrease◆ Slight drop in import costs◆ Inquires for GHP and "EneFarm“ fuel cell co-generation systems
increase due to concerns about
electric power supply

Nov 7,2012

Other Businesses
Sales
20

Operating Income

16.2
0.8

0.7

15.3

15.6
15.6+0.3 (+1.6%)

10016.3

10+0.1 (+0.7%)-0.1 (-15.6%)

51.5+0.3 (+1.6%)

FY2012 Apr-Sept

Japan

Billions of yen

FY2013 Apr-Sept

1.7+0.2 (+17.8%)

0FY2012 Apr-Sept

FY2013 Apr-Sept

Overseas

Nov 7,2012

TAIYO NIPPON SANSO Corporation8

Major Other Businesses (Sales)
Medical Business

8.2

104.3

50

8.4+0.2(+1.8%)
4.6+0.2(+5.5%)

3.8
FY2012 Apr-Sept
Medical-use gases

Billions of yen

Thermos Business
1056.70.6

0.5-0.1 (-15.2%)

6.06.0

3.7-0.1 (-2.5%)

FY2013 Apr-Sept
Equipment, services, etc.

≪Japan≫Slight decrease in medical-use oxygen
sales
Medical-related equipment sales arestrong
Equipment for hospital sales are brisk

6.6-0.1 (-1.4%)+0 (+0.1%)

0FY2012 Apr-Sept
JapanFY2013 Apr-Sept
Overseas≪Overseas≫
Sales company established in South
Korea last year is not included in thescope of consolidation≪Japan≫Demand flat for mainstay sport-use
stainless steel vacuum insulatedbottles

Nov 7,2012

Management Policies & Priority Issues

Nov 7,2012

TAIYO NIPPON SANSO Corporation9Management Policies
Further strengthen Japanbusiness base

Further expand
overseas businessRevitalization ofTaiyo Nippon Sanso Group

Aiming to become major Asian-born player inthe global industrial gases industry
Nov 7,2012

Priority Issues
Organizational restructuring centered on industrial
gases and electronics-related businesses
Expansion of overseas business including boosting theearning capacity of North American business
Strengthen response capabilities of plant engineering
New business creation to become new earnings pillar
Raise earnings by ¥5.0 billion
over the short term
Nov 7,2012

TAIYO NIPPON SANSO Corporation

10

Important Fields forTechnology Development

Nov 7,2012

Important Fields forTechnology Development
1.

Plant Engineering• Technology introduction

2.

Advanced Medical Treatment• Oxygen stable isotopes• Cryopreservation systems

3.

Environment and Energy• Hydrogen filling stations

4.

Electronics• Advanced ＭＯＣＶＤ equipment - ＵＲ２６Ｋ

5.

Space Development• Space-simulation chambers
Nov 7,2012

TAIYO NIPPON SANSO Corporation

11

1. Plant Engineering＜Large air separation plants＞(Overview)• Cryogenic air separation plants have continued to be improved andupgraded over their 100-year history• A recent major technological advancement is the reduction of the electricpower consumption rate using large air separation plants and packedcolumns• Boasts largest oxygen production volume in Japan at 65000Nm3/h

Filling

Structure of Packet
columnNov 7,2012

1. Plant Engineering＜LNG cold energy technology＞(Overview)• Air separation plants, which produce liquefied oxygen and liquefied nitrogen,consume large amounts of electrical power in the liquefying process• Air separation plant, which use LNG cold energy, can reduce electrical power
consumption by about 50%• Can handle a variety of LNG, from low pressure to high pressure• World’s number one delivery record of LNG cold energy air separation plants(Track record in LNG cold energy airseparation plants)• Delivered Japan’s first air separation
plant to Yokohama in 1971
• Delivered 9 plants in Japan and1 plant overseas
Air separation plant (Chiba）

24

TAIYO NIPPON SANSO Corporation

Air separation plant (Aichi)

Nov 7,201212

2. Advance Medical Treatment(oxygen stable isotopes)＜Status＞

Demand for oxygen stable isotope Water-18O, the raw material for medical PET diagnostic
agents, is increasing
1. Approved for use in PET diagnostics for Alzheimer’s diseasein April 2012 in U.S.
2. Existing use for diagnosing cancer is growing at an annual rateof 5-10%↓The global market for 1. and 2. combined is expected to doublein five years＜TNSC’s production capacity＞
Construction of plant with production capacity of 200kg/year is now
underway within the Chiba Sanso Center’s Sodegaura plant and isscheduled for completion in early 2013
Combined with existing facilities (Goi plant of Chiba SC), we havean annual capacity of 300kg/year
Additional plant expansion is now being studied

Goi Plant

Nov 7,2012

2. Advanced Medical Treatment(Cryopreservation）
ｾﾙﾊﾞﾝｸｼｽﾃﾑ

Cell bank

小型容器
Started withlivestock
breeding /Compact
containers of 2L
– 36L

１９７２～

Large
container
Large
preservation
containers of
100L – 1000L forbasic researchCentralized cell
management withlarge-scale bioresource
preservation

１９９０～

CryoLibrary®
In regenerative
medicine, cell
management
prevents the wrong
cells (iPS cells,human cells, etc.)from being taken
２００８～
Nov 7,2012

TAIYO NIPPON SANSO Corporation13

2. Advanced Medical Treatment (Cryopreservation)
Share of Japan market for liquid nitrogen cryopreservation

From Aug. 15, 2008
issue of Gas Review

Large cell bank system
A made-to-order medical project of BioBank
Japan in The Institute of Medical Science, The
University of Tokyo –Serum refrigeration management system[Facility size]
DR1000AT-type containers: 47 (1,000L containers)
Nov 7,2012

2. Advanced Medical Treatment (Cryopreservation)
A totally automated cryopreservation system for human
iPS cells is now under development
Project control: Center for iPS Cell Research and Application (CiRA),
Kyoto University
Project name:
ＮＥＤＯ Evaluation-based Technology Development
for Commercialization of Human Stem Cells* Affiliated with Stem Cell Evaluation Technology
Research Association (SCETRA)

Automatic freezing, storage, anddefrosting equipmentTNSC

TAIYO NIPPON SANSO Corporation

Auto-culture equipment

Cell observationequipment

Nov 7,2012

14

３．Environment and Energy (Hydrogen filling stations)＜Japan＞
In preparation for the spread of hydrogen fuel cell-powered vehicles (FCVs)
beginning in 2015, we are proceeding with our plan to set up hydrogen filling
stations at 100 locations nationwide over a three-year period beginning fromfiscal 2013.
The equipment costs of actual filling stations is expensive, so it is essential that
we sharply lower costs to enable their wide dissemination.
＜TNSC’s R&D＞
・ Develop packaged hydrogen stations
Total of 100 filling stations
based on our own compact design
・ Cut costs in half
Located along highways
・ Begin sales from fiscal 2013 (planned)
・ As a Japanese producer, gain a leading
position in hydrogen filling station businessCentered in 4 metropolitan areas

Nov 7,2012

３．Environment and Energy (Hydrogen filling stations)＜Features of TNSC’s packaged hydrogen stations＞• User-friendly design in terms of performance, safety, operation, andmaintenance• Space-saving: Length: 7000mm Width: 2000mm Height: 2590mm（equivalent to 20 sq. ft. container)• Fill pressure:

Both 35MPa and 70MPa• Fill speed:

Hydrogen 5kg/3 min.

• Pre-cool:-40ºC• Gas storage capacity: Largest in Japan(pressure reservoir: 93MPa, 255L x 4 tanks)

Nov 7,2012

TAIYO NIPPON SANSO Corporation

15

4. Electronics (Advanced ＭＯＣＶＤ)
UR26K large-diameter mass-production type MOCVD
equipment【 Features 】
6 inches x 10 wafersor
8 inches x 6 wafers↓
Largest treatable wafer surface
in the world
Efficiency: Highly efficient deposition
process based on gascontrol technology

Nov 7,2012

4. Electronics (Advanced ＭＯＣＶＤ)
UR26K large-diameter mass-production type MOCVDequipment(Orders)• From Japanese semiconductor manufacturers (for power devices)⇒ Delivered in 2012
• From Nagoya Institute of Technology’s Nitride Semiconductor MultiBusiness Creation Center (Tentative name)⇒ Delivery scheduled for 2013
(Outlook)
Full scale demand for MOCVD equipment forpower devices will start in 2014

Nov 7,2012

TAIYO NIPPON SANSO Corporation

16

5. Space Development (Space-simulation chambers)Satellite-related business
When satellites are developed, earth-based testing in space simulation chambers isessential
TNSC space simulation chambers were used in Japan’s Hayabusa Space Project

Image
provided by:Large-scale space
simulation chambers

Small-scale space simulationchamber

Used to test satellites

Used to test satellite components,engine endurance, etc.

Nov 7,2012

5. Space Development (Space-simulation chambers)◇Satellite business competition is intensifying in Japan and overseas⇒ Space-simulation chamber competition is increasing
Overseas projects/for Southeast Asia

(Public/Private-sector institutions)
1. Large thermal vacuum space chambers
2. Large special space chambers
3. Mid-size thermal vacuum space chambers
4. Small thermal vacuum space chambers

2113(University-related)
1. Small- to mid-size space chambers

2

1. Large thermal vacuum space chambers
2. Small thermal vacuum space chambers
Estimated value (overseas): about ¥0.6 billion

Estimated value (Japan): about ¥4.2 billion≪Delivery Record≫
Total: 71 chambers (all in Japan）
Total value of orders: about ¥12 billion

Image provided by: JAXA

Nov 7,2012

TAIYO NIPPON SANSO Corporation

17

Consolidated Full-Term Forecasts for FY2013

Nov 7,2012

Consolidated Full-Term Forecasts for FY2013
Billions of yen

FY2012FY2013(Results)(Forecast)

Change(YoY)

477.4

474.0-3.4

Operating
Income31.0

26.3-4.7

Recurring
Income

29.7

Sales

Net Income

6.5%

6.2%

21.2
4.4%

5.5%

24.3

-5.4

5.1%

0-21.20%% change(YoY)-0.7%-15.3%-18.3%-100.0%

Nov 7,2012

TAIYO NIPPON SANSO Corporation

18

Industrial Gases Business Segment Forecasts for FY2013
Sales
400

Operating Income
301.7

291.0

+10.6 (+3.7%)

300

109.0

91.9

+17.0 (+18.6%)

200

199.1

100

192.7
-6.4 (-3.2%)

0FY2012FY2013 (Forecast)Japan

Billions of yen

50403021.7

23.4+１.6 (+7.8%)

20100Overseas

FY2012FY2013 (Forecast)*The above sales graph is divided into Japan and Overseas sales

Nov 7,2012

Electronics Business Segment Forecasts for FY2013
Sales
150

Operating Income
20115.2
97.8-17.4 (-15.2%)

31.1

10050

84.1

27.3

1510FY2012

70.5

FY2013 (Forecast)Japan

5.9-3.8 (-12.5%)

5-0.6-6.5 (-110.1%)-13.6 (-16.2%)

0Billions of yen

0-5

FY2012FY2013 (Forecast)

Overseas

Nov 7,2012

TAIYO NIPPON SANSO Corporation

19Energy Business Segment Forecasts for FY2013
Sales

Operating Income

Billions of yen

45041.0 +2.1 (+5.4%)

38.8

31.9+0.3(+13.9%)

1.6225

10FY2012

FY2013 (Forecast)

0FY2012FY2013 (Forecast)

Nov 7,2012

Other Businesses Segment Forecasts for FY2013
Sales
4030

Operating Income

32.2
1.620

30.6

33.5+1.2 (+4.0%)

Billions of yen

101.4-0.2 (-12.5%)

32.15

2.7+1.4 (+4.8%)

2.9+0.2 (+6.5%)

100

FY2012
JapanFY2013 (Forecast)

0FY2012FY2013 (Forecast)

Overseas

Nov 7,2012

TAIYO NIPPON SANSO Corporation

20

Disclaimer
This material is not intended for purposes of disclosure forsecurities transactions, and it is impossible to guarantee thatthe information contained in this presentation is accurate andcomplete.
This presentation and report contain forward-looking
statements (estimates and forecasts) regarding the future plans,
strategies, activities and performance of Taiyo Nippon Sanso
Corporation. Forward-looking statements reflect management’s
assumptions and beliefs based on information available as of
the time of writing. Risks and uncertainties include, but are notlimited to, changes in general economic and specific market
conditions, currency exchange rate fluctuations, tax systems,and regulations.
Actual results may thus differ substantially from the said
forward-looking statements, and investment decisions should
not be made solely on the basis of the information provided
herein.
Nov 7,2012

TAIYO NIPPON SANSO Corporation

21