Translation

July 15, 2010

Consolidated Financial Results
for the Fiscal Year Ended May 31, 2010
Listed company name:
Stock exchange listing:Stock code:
Location of headquarters:
Website:Representative:
Contact:

Toyo Tanso Co., Ltd.
Tokyo Stock Exchange, 1st Section
5310
Osaka, Japan
http://www.toyotanso.co.jp
Naotaka Kondo, President & Chief Operating Officer
Toshimi Boki, Executive Officer, General Manager,
Finance and Accounting Department
81-6-6451-2114 (from overseas)

TEL:
Scheduled date for ordinary general
meeting of shareholders:
Scheduled date for dividend payment:
Scheduled date for submission of
securities report:

August 27, 2010
August 30, 2010
August 30, 2010

1. Consolidated financial results for the fiscal year ended May 31, 2010
(From June 1, 2009 to May 31, 2010)(1) Operating results(Millions of yen, rounded down)(Percentages indicate changes from the same period in the previous fiscal year.)Net sales

Operating profit

Recurring profit%
Fiscal year ended May 31,
2010
Fiscal year ended May 31,
2009

Net income

%

%

%

27,924

(9.8)

2,253

(52.5)

2,070(53.8)

1,442(43.8)

30,974(10.3)

4,741(41.0)

4,483(42.5)

2,566(50.1)Net income per share

Diluted net income
per share

Equity ratio

Recurringprofit/total assets

Operatingprofit/net sales

yen

yen

%

%

%

69.56

69.56

3.0

3.4

8.1

123.80

-

5.5

7.7

15.3

Fiscal year ended May 31,
2010
Fiscal year ended May 31,
2009
Reference: Equity in earnings of affiliates
May 31, 2010
May 31, 2009

- million yen- million yen(2) Financial position(Millions of yen, rounded down)
Total assets

EquityEquity ratio

Equity per share%yen

As of May 31, 2010

61,786

48,96077.4

2,306.55

As of May 31, 2009

58,821

48,60680.6

2,286.27

Reference:

Shareholders’ equity
May 31, 2010
May 31, 2009

47,825 million yen
47,404 million yen-1-(3) Cash flows
Cash flows fromoperating activities

Fiscal year ended May 31,
2010
Fiscal year ended May 31,
2009

Cash flows frominvesting activities(Millions of yen, rounded down)
Cash and cash
Cash flows fromequivalents at end of
financing activities
period3,377(4,103)

252

5,802

5,105

(8,420)

(568)

6,412

2. Dividends(Millions of yen, rounded down)Firstquarterend
yen

Dividends per share (yen)ThirdInterimYearquarter
-end
-end
end
yen
yen
yen

Total
(Full
year)
yen

Total
dividends(annual)Payout ratio(consolidated)

Ratio ofdividends tototal assets(consolidated)%%Year ended May 31, 2009

-

0.00

-

20.00

20.00

414

16.2

0.9

Year ended May 31, 2010
Fiscal year ending May
31, 2011 (Forecast)

-

0.00

-

20.00

20.00

414

28.8

0.9

-

0.00

-

22.00

22.00

30.4

3. Consolidated results forecast for the fiscal year ending May 31, 2011
(From June 1, 2010 to May 31, 2011)

Net sales

Operating profit%

Cumulative total for thesix months
Fiscal year ending May
31, 2011(Millions of yen, rounded down)(Percentages indicate year-on-year changes.)
Net income
Recurring profit
Net income
per share

%

%

%

yen

15,500

22.6

1,200

46.9

1,200

81.5

700

89.2

33.76

32,000

14.6

2,500

11.0

2,500

20.8

1,500

4.0

72.34

4. Others(1) Changes in significant subsidiaries during the period(changes in specified subsidiaries accompanying changes in scope of consolidation):

None(2) Changes in accounting policies, procedures, and methods of presentation for preparing theconsolidated financial statements(those to be described in “Changes in Significant Items That Form the Basis of Preparations for
Consolidated Financial Statements”)
i. Changes due to amendment of accounting standards: Yes
ii. Changes due to other reasons:None
Note: For more details, please refer to “Changes in Significant Items That Form the Basis of Preparations for
Consolidated Financial Statements” (in Japanese only) on page 23.

-2-(3) Number of shares outstanding (common stock)i. Number of shares outstanding at the end of period (including treasury stock)
As of May 31, 2010
20,750,688 shares
As of May 31, 2009
20,750,688 shares
ii. Number of treasury stock at the end of period
As of May 31, 2010
16,215 shares
As of May 31, 2009
16,115 shares
Note: For the number of shares as a basis of calculating net income per share (consolidated), please refer to“per-share information” (in Japanese only) on page 28.

Reference: SUMMARY OF NON-CONSOLIDATED FINANCIAL STATEMENTS

1. Non-consolidated financial results for the fiscal year ended May 31, 2010
(From June 1, 2009 to May 31, 2010)(1) Operating results
Net sales(Millions of yen, rounded down)(Percentages indicate year-on-year changes.)
Recurring
Net income
profitOperating profit%

Fiscal year ended May 31,
2010
Fiscal year ended May 31,
2009

%

%

20,848(8.0)

210(81.7)

419(76.1)

393(70.3)

22,658(13.6)

1,151(74.1)

1,756(59.2)

1,323(54.4)Net income per share

Diluted net income per
share

yen

yen

18.99

18.99

63.82

-

Fiscal year ended May 31,
2010
Fiscal year ended May 31,
2009%(2) Financial position(Millions of yen, rounded down)
Total assets

EquityEquity ratio%

Net assets per shareyen

As of May 31, 2010

50,66040,81680.6

1,968.21

As of May 31, 2009

49,457

40,83082.6

1,969.19

Reference:

Shareholders’ equity
May 31, 2010
May 31, 2009

40,809 million yen
40,830 million yen* Disclaimer regarding appropriate use of forecasts and related points of note
The above forecasts are based on information available at the time of the release of this report. Actual results
may differ from the projected figures due to a variety of factors. For any further information regarding theforecasts, please refer to “1. Business Results, (1) Analysis of Business Results” on page 4.

-3-

1. Business Results(1) Analysis of Business Results(i) Business Results for the Fiscal Year ended May 31, 2010
During the consolidated fiscal year ended May 31, 2010, the global economy saw strengthening signs ofgradual recovery led by China and other emerging countries owing in part to the implementation of economic
stimulus measures in each country, but impacts of the worldwide recession have continued to dampen therecovery momentum. The Japanese economy has also started to pick up as a result of improved exports andproduction and the advancement of inventory adjustment, but it has yet to achieve self-sustaining recovery.
Without any improvement in capital investment and employment conditions, the economic situation continued tobe difficult, on the whole.
Amid these circumstances, the Toyo Tanso Group concentrated on acquiring demands mainly in theenvironment and energy sectors in Japan and abroad where growth is anticipated, as well as pursued independent
efforts to minimize costs, expenses and investments.
As a result, toward the end of the consolidated fiscal year under review, business performance rapidly
recovered from the large impact it received from the drastic drop in sales and production during the first half ofthe fiscal year, and registered net sales of 27,924 million yen (down 9.8% from the previous year), an operating
profit of 2,253 million yen (down 52.5%), and a recurring profit of 2,070 million yen (down 53.8%). Net
income for the year came to 1,442 million yen (down 43.8%).
The table below shows overall performance in each product category for the consolidated fiscal year underreview.
(Thousands of yen)
Products
Special graphite products
Carbon products for general industries(for mechanical applications)
Carbon products for general industries(for electrical applications)Compound materials and other products
Related goods
Total

Year ended May 31, 2009
16,184,952

Year ended May 31, 2010
14,184,631

Year-on-year change (%)(12.4)

2,735,542

2,269,822(17.0)

4,081,854

3,931,710(3.7)

7,295,542
676,41430,974,306

6,711,086
827,60227,924,853

(8.0)
22.4
(9.8)

Special Graphite Products
Special graphite products for electronics applications started out weak on the whole. This is because
products for the production of single crystal silicon needed to be adjusted to correct the poor performance causedby the impact of our customers’ inventory adjustment, and also because weakening demand in our mainstay
Chinese and European markets also affected demand for our products for the manufacture of solar cells.
However, orders for both picked up after the turn of the year, and demand began to recover. Recovery of thisproduct area became evident, with sales showing positive growth in the fourth quarter.
Special graphite products for general industries applications, including our core products for electricaldischarge machine (EDM) electrodes and metallurgical processes, also started out poorly, but demand turned
upward mainly in overseas markets after the worldwide recession bottomed out in the latter half of the year.
Carbon Products for General Industries
Carbon products for mechanical applications hovered at generally low levels, with cutbacks in general
capital expenditure and production adjustments in Japan adversely affecting the sales of bearings and sealingmaterials, our core products in this field. However, a gradual recovery is underway, owing in part to the steadycultivation of overseas markets. Meanwhile, pantograph sliders are enjoying continuous robust growth,
unaffected by economic conditions.

-4-Among carbon products for electrical applications, our core products for small motors intended for vacuum
cleaners and electric power tools achieved quick recovery mainly in China. Sales of carbon products forautomobiles, such as fuel pumps, also expanded, and boosted overall performance in this product area.
Compound Materials and Other Products
Compound materials as a whole further strengthened their upward momentum, given the rapid growth indemand for SiC (silicon-carbide)-coated graphite products, and particularly LEDs for LCD backlight purposes,
mainly in Asia, and the recovery of semiconductor-related products in the latter half of the year. C/C composite
products remained sluggish as an impact of the inventory adjustment of products for the manufacture of single
crystal silicon, but sales rapidly expanded in the fourth quarter, owing to a sharp increase in demand for products
for the manufacture of solar cells, including orders from new customers, since the turn of the year, and also to alarge-scale delivery of products for nuclear fusion reactors. Graphite sheet products enjoyed strong demand on
the whole, accompanying the recovery of the automobile and semiconductor markets.
(ii) Outlook for the Fiscal Year Ending on May 31, 2011
Domestic and foreign economic climates hereafter are expected to continue their gradual trend toward
recovery led by emerging countries. However, it is too early yet for optimism because, in addition to concernsthat economic stimulus measures might run out of steam, there also exist such unstable factors as Europe’s credit
insecurity, exchange rate fluctuations, employment conditions, and prices of raw materials and fuels.
The business environment surrounding the Toyo Tanso Group, including the foreign exchange situation,
remains uncertain and difficult to predict. However, we anticipate steady increase in demand particularly for
LEDs, solar cells, and other products in the environment and energy sector. Keeping our eye on such future
market trends, we will actively aim to increase sales by making full use of our Takuma Plant, which recently
commenced full-scale operations, and further accelerate our efforts to strengthen our overseas bases and expand
on a global scale.
As our outlook for the next fiscal year, we expect to achieve net sales of 32 billion yen (up 14.6% from theprevious year), an operating profit of 2.5 billion yen (up 11.0%), a recurring profit of 2.5 billion yen (up 20.8%),
and a net income of 1.5 billion yen (up 4.0%), taking into consideration the burden of depreciation costs that willreach their peak due to the high level of investments made during the previous year and the impact of yen
appreciation. (Assumed exchange rate: 90 yen/US$, 110 yen/EUR)(2) Analysis of Financial Position(i) Assets, Liabilities, and Equity
Total assets as of the end of the consolidated fiscal year under review increased by 2,965 million yen fromthe previous consolidated fiscal year. While cash on hand and in banks decreased by 6,113 million yen mainly
due to the expenditure of acquiring tangible and intangible fixed assets, there was an increase of 2,398 million yen
in trade notes and accounts receivable as a result of increased sales in the fourth quarter of the consolidated fiscal
year under review, an increase of 1,390 million yen in inventory owing to the planned accumulation ofsemi-finished goods stock, an increase of 5,082 million yen in tangible fixed assets from the expansion of
production facilities at the Takuma Plant, and an increase of 542 million yen in intangible fixed assets from theacquisition of new land (land lease right) in Shanghai, China.
Total liabilities increased by 2,611 million yen from the end of the previous consolidated fiscal year. This
increase was primarily due to an increase of 636 million yen in trade notes and accounts payable, an increase of
973 million yen in notes and account payable-equipment, and an increase of 718 million yen in interest-bearing
debt incurred from financing of equipment.
Total equity increased by 353 million yen from the end of the previous consolidated fiscal year. This net
increase was primarily driven by an increase of 1,027 million yen in retained earnings from the net income for theyear, and a decrease of 606 million yen in valuation and translation adjustments.

-5-

(ii) Cash Flows
Cash and cash equivalents (hereinafter referred to as “funds”) in the consolidated fiscal year ended on May
31, 2010 decreased by 609 million yen from the end of the previous consolidated fiscal year, to 5,802 million yen
on a consolidated basis.
(Cash Flows from Operating Activities)
Funds provided by operating activities decreased 33.9% from the previous year to 3,377 million yen.
Among the main items, profit before income taxes totaled 2,225 million yen (down 51.8% from the previous year),and depreciation costs totaled 3,753 million yen (up 14.0%), while the increase in notes and accounts receivable trade came to 2,597 million yen as a result of increased sales in the fourth quarter (a decrease of 2,771 million yen
in the previous year).
(Cash Flows from Investing Activities)
Funds used in investment activities decreased 51.3% from the previous year to 4,103 million yen. Amongthe main items, while proceeds from time deposits totaled 11,822 million yen (up 232.2% from the previous year),
expenses for the acquisition of tangible fixed assets amounted to 9,223 million yen (up 110.6%), expenses for theacquisition of intangible fixed assets 533 million yen (up 884.2%), and payments for time deposits 6,325 million
yen (down 21.5%).
(Cash Flows from Financing Activities)
Funds provided by financing activities came to 252 million yen (568 million yen in funds were used in theprevious year). Among the main items, net increase in short-term borrowings totaled 382 million yen (up 26.5%
from the previous year), and proceeds from long-term borrowings totaled 553 million yen, while repayment oflong-term borrowings amounted to 177 million yen (down 66.6%) and payments of dividends amounted to 414
million yen (up 33.1%).
(3) Basic Policy for Profit Allocation and Dividends for the Fiscal Year Ended on May 31, 2010 and the
Fiscal Year Ending May 31, 2011(i) Basic Policy
Our basic policy for profit allocation is to make strategic investments in order to strengthen ourcompetitiveness and enhance our value over the long term and return profits to shareholders in a continuous andstable fashion with due consideration of both business results for the fiscal year, funding needs for the future
expansion of our business operations and consolidation of our business foundation. We intend to use internal
reserves for capital expenditures for production facilities, development of new products and investment inresearch and development.
(ii) Dividends for the Fiscal Year Ended on May 31, 2010
Based on the above-mentioned policy, we plan to distribute annual dividends of 20 yen per share for the
fiscal year ended on May 31, 2010 in line with our initial dividend forecast in consideration of the need to
improve shareholders’ returns, at the same time as taking into account the business results in this fiscal year andcapital expenditure plans aimed at future growth.
(iii) Dividends for the Fiscal Year Ending on May 31, 2011
We plan to pay a dividend of 22 yen per share for the fiscal year ending on May 31, 2011 in consideration of
improving shareholders’ returns amid a business environment that is expected to be difficult.

-6-(4) Business and other risks
Below are matters that are deemed to have the potential to become risk factors and to have a significant
effect on the judgment of investors among those relating to the business and accounting conditions of the Toyo
Tanso Group.
Although the Toyo Tanso Group is aware of the possibility that these risks could occur and takes steps to
avoid the occurrence of these risks and responds to them if they have occurred, we believe that a decision to invest
in the securities of Toyo Tanso needs to be made by carefully considering the description in this section and details
described in other sections of this report.
Forward-looking statements made on the following matters reflect the judgment of the Toyo Tanso Group asof the date of releasing this report and contain uncertainties. Therefore, forecasts and projections contained inthese statements may differ from actual results.
(i) Effect of market conditions on operating results
Special graphite products, core products of the Toyo Tanso Group, are used for a broad array of areas,
including electronics, dies, metallurgy, chemical and atomic reactors. Sales have been growing, particularly inelectronics applications accompanying the expansion of the markets for the manufacturing of silicon
semiconductors, solar cells and compound semiconductors (LED and laser diodes). A number of compoundmaterials and other products are also used for electronics applications.
The Toyo Tanso Group works to diversify business risks by securing a market share in carbon products formechanical applications and electrical applications other than special graphite products and by developing new
applications such as metallurgy applications. We also strive to make appropriate business judgments byanalyzing and projecting movements in the electronics industry. However, if the electronics industry weakens
contrary to our expectations, it could have an impact on the business performance of the Toyo Tanso Group.
(ii) Competition
Although the Toyo Tanso Group provides carbon products to a broad array of customers, companies in the
carbon product industry compete on technologies and prices. The Toyo Tanso Group aims to early develop highvalue-added products that meet diverse customer needs and products that could stimulate demand based oncooperation between its production and sales divisions. We also strive to reduce costs and expenses. However,developments at our competitors and price competition could have an impact on the operating results of the Toyo
Tanso Group.
(iii) Effect of prices of raw materials and fuels on operating results
Although the Toyo Tanso Group takes measures to control the effect of rising prices of raw materials andfuels in such a way as purchasing from two suppliers and passing costs onto prices, a rise in prices of raw
materials and fuels more than expected could have an impact on operating results of the Toyo Tanso Group.
(iv) Inventories
Although the Toyo Tanso Group manufactures processed products to order, it produces isotropic graphite
materials based on a make-to-stock production system, since it takes about five months to manufacture isotropic
graphite materials. The Toyo Tanso Group endeavors to avoid excess inventory by projecting demand for
isotropic graphite materials every month and preparing a production plan. However, if demand for isotropic
graphite materials declines more than expected, it could lead to excess inventories temporarily, even if they do notundergo a temporal change.
The Toyo Tanso Group obtains information directly from customers based on its direct marketing and works
to reflect this on joint research and development with customers and in-house product development andimprovements. As a result, the inventory turnover period was 4.7 months in the fiscal year under review.

-7-

(v) Concentration of production bases
Since the production facilities of the Toyo Tanso Group are concentrated in Kagawa Prefecture, it could havean effect on the financial conditions and operating results of the Group if a large-scale disaster, etc. occurs in theprefecture.
(vi) Effect of legal regulations
The carbon products of the Toyo Tanso Group are subject to export-related laws and regulations, such as theForeign Exchange and Foreign Trade Act and the Regulations pertaining to the Export of Nuclear Equipment by
the International Atomic Energy Agency (IAEA). In this environment, the Toyo Tanso Group seeks to comply
with laws and regulations but could receive guidance under these legal regulations. Also, if an unexpected
statutory regulation is set up in the future, it could have an impact on the business performance of the Toyo Tanso
Group.
(vii) Effect of overseas business activities on operating results
The Toyo Tanso Group is proactive in expanding its production and sales bases to increase its ability torespond to customer needs quickly and to supply its products in a timely manner. Although the ratio of overseas
sales to consolidated net sales was 56.0% in the fiscal year under review, it could further rise in the future
depending on progress in our global operations. Also, changes in exchange rates, political conditions and legal
regulations in overseas markets could have an impact on the operating results and financial position of the Toyo
Tanso Group. In particular, changes in the political and foreign exchange policies in China could have an effecton the business performance of the Toyo Tanso Group, since we make active investments in China throughmeasures such as establishing new plants in response to increasing demand in China.
(viii) Capital expenditures in the future
In the Toyo Tanso Group, materials production and other divisions make capital investments to increase theirproduction capacity. These investments could have an impact on the business performance of the Group if
market conditions change rapidly or if the payback period is prolonged.
(5) Key events related to the assumption of the business as an ongoing concern
None

-8-

2. Composition of Corporate GroupThe Toyo Tanso Group consists of Toyo Tanso Co., Ltd., ten consolidated subsidiaries, including two
domestic and eight foreign companies, two foreign non-consolidated subsidiaries, and one overseas affiliatedcompany not accounted for by the equity method. The main businesses of the Toyo Tanso Group are the
manufacture, processing and sale of carbon products for high function applications using isotropic graphite
materials (Note). Carbon products of the Toyo Tanso Group are used in a broad array of areas, and we need to
manufacture a range of products in small quantities since the specifications our customers require range over abroad spectrum.
The Toyo Tanso Group succeeded in pioneering the high-volume production of isotropic graphite materials
in 1974 ahead of competitors in Japan and overseas. This was followed by achievements in growth in size.
The Group has been expanding the applications of these products. We efficiently manufacture carbon materials
centering on these isotropic graphite materials by concentrating production on bases in Japan, and we haveconstructed a system to directly sell these products to local customers by supplying them to processing and sales
bases located in Japan and other countries in North America, Europe and Asia. We have established a stableproduct supply system with a short delivery time through this integrated production and sales system, whichranges from materials to products, and we develop products by promptly absorbing customer needs in acooperative relationship with customers based on our direct sales system.
The Toyo Tanso Group also conducts basic and applied studies based on customer needs and the analysis
data of carbon products, which we have been accumulating for many years as a carbon-specialized producer. As
a result, the applications of our products have been expanding into a wide spectrum of areas from industrial andcommercial applications such as industrial machinery, automobiles, and consumer electronics to cutting-edge
areas such as atomic power, aerospace, medical and energy.
Note:

Isotropic graphite materials
Carbon materials are categorized into graphite materials that are manufactured by high temperatureprocessing and other carbon materials. Of graphite materials, isotropic graphite materials arecharacterized by the fact that their nature is the same in all three dimensional directions.
To manufacture isotropic graphite materials, it is necessary to apply equal pressure from all directions in
the molding process, and we have established a production method using a hydrostatic molding method(a molding method that put pressure under water), ahead of competitors in Japan and overseas.
The main characteristics of graphite materials are as follows:(i) High thermal conductivity (*) and electronic conductivity(ii) High resistance to heat and chemicals(iii) Light and workable(iv) Resistant to friction and attrition
In addition to the above, isotropic graphite materials have the following characteristics:(i) Traits such as thermal expansion (*) are the same in all directions.
(ii) High strength with an ultra-fine particle structure and very small material dispersion.
Materials, applications, items, examples and characteristics of each product are as follows.

-9-Special graphite
products

Materials/applications/items
For the manufacture of single
crystal silicon
Electronics
For the manufacture ofapplications
compound semiconductors
For the manufacture of solar
cells
General industries applications
For the manufacture ofadvanced process equipment
OthersCarbon products
for generalindustries

For atomic power, aerospaceand medical

Carbon products formechanicalapplications

General industries
applications
For transportation

Carbon products forelectricalapplications

For small motors

Product examples
Crucibles and heaters for single crystal growing furnace
Susceptors for MOCVD systems, boats for LPE
systems
Crucibles and heaters for single crystal and polycrystal
silicon manufacturing furnace
Continuous casting dies, EDM electrode, heaters forvarious industrial furnaces
Electrodes for ion implantation equipment, glass sealing
jigs
Cores for high-temperature gas reactors, wall materials
for nuclear fusion reactors, rocket parts, parts for CT
scans
Bearings and seals for pumps and compressors
Pantograph sliders, automotive parts
Carbon brushes for vacuum cleaners and wind-power
generators
Large brushes, carbon brushes for wind-power
generators
Susceptors for semiconductor production, wallmaterials for nuclear fusion reactors, automotive
gaskets, susceptors for MOCVD systems

For large motors

Compound materials and other products(1) Special graphite products
For special graphite products, isotropic graphite materials are mainly used.
(i) Electronics applications(a) For the manufacture of single crystal silicon
Silicon wafers that are manufactured by slicing single crystal silicon are basic materials that help drive thedevelopment of the electronics industry, as a semiconductor substrate such as a high integrated memory device.
Major consumable parts inside a furnace such as crucibles (*) and heaters that are used in a single crystal silicon
growing furnace rely on isotropic graphite products, since these parts require high purity and high thermal
resistance.
With the diameter of single crystal silicon increasing, the shift to a manufacturing process using 300 mm
wafers has been progressing. The Company has the capacity to produce the world’s largest isotropic graphite
materials and to meet demand from customers in Japan and overseas by using its processing and high purity
production facilities.
(b) For the manufacture of compound semiconductors
Compound semiconductors (*), which are used as light emitting devices, telecommunications devices, powerdevices, etc. are also employed as high efficiency light emitting devices for digital consumer electronics such as
mobile phones, DVDs and LCDs, automotive head lumps and fluorescent tubes, taking advantage of their features,such as a long life and electric power saving.
In Japan and overseas, major consumable parts such as heating elements and susceptors for MOCVD
systems (*), which are used in the manufacturing process of these compound semiconductors, rely on the isotropic
graphite products of the Company, as these parts require high purity and high processing accuracy.
(c)

For the manufacture of solar cells
Solar cells are representative of the clean energy technology. Their applications are expected to expand on a
global scale, given the legislations of subsidies for the purchase and installation of residential power generation
systems in countries around the world, and other such national policies.

- 10 -

Major consumable parts inside furnaces, such as heaters and crucibles used in the manufacturing process of
single crystal and polycrystal silicon, the major materials of a solar cell element, use our isotropic graphite
products, as these parts require high thermal resistance and high durability.
(ii) General industries applications
Isotropic graphite materials have high thermal and chemical resistance and electrical conductivity evenamong graphite materials. Taking advantage of these features, they are used for applications such as metal
melting crucibles, continuous casting dies (*), EDM electrode (*) for manufacturing dies, the sinter of ceramics
and powder metallurgical materials, the annealing of automotive parts and other high temperature heating
elements for industrial furnaces, and construction materials inside a furnace.
The Toyo Tanso Group supplies products for these diverse industries applications in Japan and in othercountries such as China, which is enjoying high economic growth.
(iii) Others(a) For advanced process equipment
A range of isotropic graphite materials are applied for the manufacture of electrodes for ion implantationequipment, used for microfabrication in the manufacturing process of semiconductors and liquid crystal, diodes,
crystal oscillators, and sealing jigs for terminals of liquid crystal panel back lights and other advanced processequipment. Since the above equipment requires features such as high thermal resistance, thermal conductivity,
purity and strength and processing accuracy, the Company’s products are widely used by large equipment makers
and other customers.
(b) For atomic power, aerospace and medical
The atomic power applications such as cores for high-temperature gas reactors and wall materials for nuclear
fusion reactors require high credibility and quality. The Company’s products are used for these atomic power
applications, as high resistance to radiation and plasma is required, in addition to high thermal resistance and otherfeatures of graphite. Our products are also used for the aerospace applications such as rocket parts and the
medical applications including CT scans.
(2) Carbon products for general industries applications
Carbon materials that are manufactured by a conventional molding method are primarily used for carbon
products for general industries applications. Isotropic graphite materials are also used for some applications.
(i) Carbon products for mechanical applications(a) For general industries
Taking advantage of such features as abrasion resistance, thermal and chemical resistance and theirself-lubricating nature, we sell a variety of products including sliding parts such as bearings for pumps andcompressors as well as seals for gaseous and liquid bodies such as piston rings (*) and mechanical seals (*) tomachinery manufacturers in Japan and overseas. The Company operates overseas with strong costcompetitiveness by improving the homogeneity of materials and optimizing the material size through theintroduction of a new molding method.
(b) For transportation
We sell pantograph sliders (*) with high self-lubricating nature, electrical conductivity and abrasion
resistance to railroad companies by impregnating copper into carbon with high pressure. Pantograph sliders of
the Company have reduced the abrasion of overhead wires and achieved lower noise compared with conventional
metal sliders.
We also manufacture and sell compressor parts of brakes for the automotive industry.

- 11 -

(ii) Carbon products for electrical applications(a) For small motors
We sell carbon brushes for small motors for commercial uses, such as vacuum cleaners and power tools, toconsumer electronics, tool makers, and other customers. The Company’s products are characterized by long life,
high durability and a rectifying property against high-speed rotation. We are also responding to the needs ofsmall motor manufacturers who have shifted their production to China, by establishing production subsidiaries in
China.
(b) For large motors
Our products are used by steel and paper manufacturing companies as carbon brushes for large motors forindustrial applications, taking advantage of high self-lubricating nature, electrical conductivity and workability.
A carbon brush is a device that enables a stable and sustained supply of electricity while sliding on rotating bodies
and has come to be used for the environment and energy, such as the power collection facilities of wind-power
generation.
(3) Compound materials and other products
In compound materials and other products, we manufacture and sell compound materials coated by othermaterials with isotropic graphite as the base material (SiC coated graphite (*), etc.), materials compounded withcarbon and carbon fiber (C/C composite products (*)), and natural graphite materials (graphite sheets (*)).
(i) SiC coated graphite products
SiC coated graphite products have high thermal and etching resistance (*) and high purity that reduces thegeneration of organic pollutants. Taking advantage of these features, we sell these products to the semiconductor
industry in Japan and overseas as susceptor materials for the thin film manufacturing process in the production
process of silicon and compound semiconductors.
(ii) C/C composite products
C/C composite products are advanced materials that are light and strong and retain a high carbon thermal
quality, and that are used for a wide spectrum of applications in Japan and overseas, such as the manufacturing
process of solar cells and silicon single crystal, materials for vacuum furnaces as well as special applications
including the wall materials of nuclear fusion reactors.
(iii) Graphite sheet products
Graphite sheet products are light sheeted products and are used for automotive parts such as gaskets andmufflers, given their characteristics of being insensitive to other substances even under high temperatures.
Demand for graphite sheet products is also rising for the protection of carbon members in the manufacturing
process of quartz and silicon single crystal. Going forward, applications in areas that require dealing with heatsuch as a heat sink are also expected, leveraging their high thermal conductivity in the face direction. Graphite
sheet products are also seen as a promising alternative product for asbestos in petroleum and chemical plants.
For words with an asterisk (*), please refer to the glossary below.
This glossary is prepared by the Company based on its understanding and judgment as a reference to enable
investors to have a better understanding of the description in this report.

- 12 -

[Glossary][Thermal conductivity]
Conductivity of heat that a substance has.
[Thermal expansion]
The expansion of a substance associated with a rise in temperature.
[Crucible]
A pot-like container for holding heat-temperature liquid.
[Compound semiconductor]
A semiconductor that consists of substances composed of multiple elements. Examples of a compound
semiconductor include gallium arsenide, gallium nitride and silicon carbide. Features which silicon
semiconductors do not have are used.
[Susceptor]
A platform used to develop a thin film on the surface of wafers.
[Continuous casting dies]
A mold to cool and solidify molten metal by touching it in a continuous casting process that casts dissolving metal
by continuously cooling it. Metal products that have the cross-section of this mold will be made continuously.
[EDM electrode]An electrode that will make a pair with a processed material. It generates an electrical discharge between theelectrode and the processed material and transcribes the shape of the electrode on the processed material.
[Self-lubricating nature]
Property in which adhesion barely occurs because of a layered crystal structure and a low friction coefficient.
[Piston ring]
A sealing ring that prevents leakages from a space between a piston and the inner wall of a cylinder in areciprocating compressor.
[Mechanical seal]
A machine part to control leaks from a rotating shaft of fluid or gas equipment, a sidewall due to a reciprocating
motion, or a pressure container, etc. and prevent the intrusion of a different liquid from outside.
[Pantograph slider]
A power collection body that collects electricity by touching an overhead wire and sliding on it to supply power toa train.
[SiC coated graphite]
A product that generates a precise thin film of silicon carbide on the surface of isotropic graphite. This can curb
the generation and reaction of a small amount of gases from graphite.
[C/C composite product]
Graphite reinforced by carbon fibers with features of light weight and high strength.

- 13 -

[Graphite sheet]
Graphite that is formed into a sheet-like shape by a special production method.
other products because of its bendy nature.

This is used for gaskets and[Etching resistance]
Degree of lack of attrition by gaseous and liquid bodies with high reactive property.

- 14 -

[Business Flow Chart]
The business flow chart of the Toyo Tanso Group is as follows.
this chart.

Only major business relations are indicated in

Customers
Processing and sales companies

TTT(Taiwan)

TTE(Italy)TTF(France)

GTD(Germany)

STT(China)JTT(China)TTU(U.S.A.)

Toyo Tanso Co., Ltd.

TTTh(Thailand)

KTT(South Korea)
Sales companies

Consolidated
subsidiary

Totan Kako Co.,Ltd.
(Japan)Ohwada Carbon
Industrial Co., Ltd(Japan)YTT(China)Manufacturing
companies

STI(China)Manufacturing
and sales
companies
Non-consolidated
subsidiary

Affiliated company

The formal names of the companies represented by the acronyms used in the chart above are as follows:
Company name
(TTU) … Toyo Tanso USA, Inc.
(TTE) … Toyo Tanso Europe S.p.A.
(TTF) … Toyo Tanso France S.A.
(GTD) … GTD Graphit Technologie GmbH
(STT) … Shanghai Toyo Tanso Co., Ltd.
(STI) … Shanghai Toyo Tanso Industrial Co., Ltd.
(TTT) … Toyo Tanso Taiwan Co., Ltd.
(JTT) … Jiaxiang Toyo Tanso Co., Ltd.
(YTT) … Shanghai Yongxin Toyo Tanso Co., Ltd.
(KTT) … Toyo Tanso Korea Co., Ltd.
(TTTh) … Toyo Tanso (Thailand) Co., Ltd.
3. Management Policy(1) Basic Policies for the Management of the Company
The fundamental management philosophy of Toyo Tanso Company Group is “Contribute to the world
through the pursuit of the possibilities inherent in carbon (C),” and based on the pioneering spirit of “Creating
things that cannot be found elsewhere” that we have embodied since our founding, our basic policy has been toprovide the world with unique, revolutionary, high functionality and specialty products, with carbon as the axis.

- 15 -

As a global industry leader with a high growth rate and robust earnings, we will continue to improve on ourworld-class quality, technology and cost competitiveness, and act to fulfill our responsibilities and make acontribution, as a company that can meet the expectations and justify the trust of its customers, stockholders,
employees and society.
(2) Medium to Long-Term Management Strategies and Issues to Address
In the medium to long-term, as a leader in high-functionality carbons, the Toyo Tanso Group will strive tomaximize corporate value, especially in areas related to the environment and energy, by promoting investment andbusiness strategies with a view to the future. We will focus specifically on the following issues.
(i) Actively expanding the core business and achieving overwhelming superiority
Within an increasingly sophisticated industry, applications and domains that require high quality carbon withhigh functionality are expanding on a global basis, and we expect increasingly challenging requirements to bemade of the Group’s high-functionality carbon products. The Toyo Tanso Group will actively enhance its
production structure and sophistication, both domestic and international, and will take comprehensive action toincrease production efficiency in order to strengthen the Group’s competitiveness.
Specifically for our main product, isotropic graphite, the Company intends to maintain its unchallenged
superiority in both quality and quantity in the industry, armed with overwhelming deployment capabilities andcost competitiveness based on our new cutting-edge Takuma plant which was built in spring 2010, as well as
products with high value addition and differentiation.
(ii) Accelerating global deployment
The increased demand and expansion of high functional carbon is becoming noticeable, not only in Japan,
but even more so in overseas markets. In addition to the European, U.S. and Asian markets, where the Company
already operates, demand is growing rapidly in emerging economies such as India, Russia and Eastern Europe.
In order to respond to these changes, since 2006 we have established sales subsidiaries in Korea, Shandong
Province in China, and Thailand, at the same time as aggressively pursuing a global strategy by strengthening ourexisting bases.
Our plans are to accelerate global expansion, with a focus on China, which continues to be a huge andattractive market, and on emerging economies, while bolstering coordination among each local entity in terms of
production and sales, to achieve our policy of promoting group management that responds to the global market.
(iii) Promoting new products and new business development
Much still has to be learned about the possibilities of carbon, and potential applications appear to beunlimited. Carbon is likely to find new uses, especially in the environment, energy and other cutting-edge areas,such as nuclear power, medical care, and next-generation devices.
In addition to developing new products by utilizing our strong partnerships with customers, the Group will
combine products with new materials and new technologies through its far-reaching government and academic
partnerships based on the Group’s advanced and abundant knowledge of elemental technology built up as pioneers
in the industry. In this way, the Group will promote unique new products and business for the future, as it seeks
further growth.
(3) Other important items related to the management of the Company
Not applicable.

- 16 -

4. Consolidated financial statements(Consolidated balance sheets)(Thousands of yen, rounded down)
As of May 31, 2009

As of May 31, 2010

AssetsCurrent assets
Cash on hand and in banks

14,035,952

7,921,993

Trade notes and accounts receivable

8,257,709

10,656,152

Merchandise and finished goods inventory

4,747,244

4,218,778

Work in process

3,476,873

5,603,781

Raw materials and stores

1,296,308

1,088,051

819,840

643,614

Deferred tax assets
Other

1,160,496

973,993

Allowance for doubtful accounts(185,780)(106,033)

Total current assets

33,608,646

31,000,331

Fixed assets
Tangible fixed assets
Buildings and structures

12,482,046

14,085,077

Accumulated depreciation(6,355,316)(6,826,376)

Buildings and structures (net)

6,126,730

7,258,700

Machinery, equipment, and vehicles

28,572,017

36,008,017(19,982,877)(22,379,940)

8,589,139

13,628,077

Land

5,353,520

5,308,552

Construction in progress

2,699,487

1,526,421

Other2,725,704

3,070,731(2,286,240)(2,501,707)

439,463

569,023

23,208,341

28,290,775

379,167

921,714

Investments in securities

280,901

219,511Long-term loans receivable

8,640

-

Deferred tax assets

33,93336,947

Accumulated depreciation
Machinery, equipment, and vehicles (net)

Accumulated depreciation
Other (net)Total tangible fixed assets
Intangible fixed assets
Investments and other assets

Other

1,334,071

1,316,954

Allowance for doubtful accounts(32,640)(5)

Total investments and other assets

1,624,906

1,573,408

Total fixed assets
Total assets- 17 -

25,212,415

30,785,898

58,821,061

61,786,229

(Thousands of yen, rounded down)
As of May 31, 2009

As of May 31, 2010

Liabilities
Current liabilities
Trade notes and accounts payable

1,725,878

2,362,097

Short-term borrowings

1,323,950

1,682,140

Other account payable

3,420,334

3,348,215

Accrued income taxes

290,192

180,746

Reserve for employees’ bonuses

756,470

713,946

Reserve for directors’ and corporate auditors’
bonuses

35,840-Other

1,595,887

2,633,638

Total current liabilities

9,148,554

10,920,785

Long-term liabilities
Long-term borrowings

70,740431,074

Deferred tax liabilities

351,606

384,597

Reserve for employees’ retirement benefits

329,736592,593

Other
Total long-term liabilities
Total liabilities

313,578496,923

1,065,661

1,905,188

10,214,216

12,825,974

7,692,575

7,692,575

EquityShareholder’s equity
Common stock
Capital surplus

9,534,686

9,534,686

Retained earnings

30,856,790

31,884,339(56,997)(57,408)

984

1,842

Foreign currency translation adjustments(623,226)(1,231,034)

Total shareholder's equity

47,404,814

47,825,002

-

6,696

Treasury stock - at cost
Unrealized gains (losses) on available-for-salesecurities

Share warrants
Minority interests

1,202,030

1,128,557

Total equity

48,606,845

48,960,255

58,821,061

61,786,229

Total liabilities and equity- 18 -

(Consolidated statements of income)(Thousands of yen, rounded down)
From June 1, 2008 to May 31, 2009

From June 1, 2009 to May 31, 2010

Net sales

30,974,306

27,924,853

Cost of goods sold20,057,671

19,931,546

Gross profit

10,916,634

7,993,307

Selling, general and administrative expenses

6,175,405

5,740,166

Operating profit

4,741,228

2,253,140

Interest income

99,75545,682

Dividends income

7,852

53,737

Gain on foreign currency option

99,695

95,100Sundry income

60,381

77,839Total non-operating income

267,684

272,359

Interest expenses

33,19338,137

Loss on sale of notes

1,876

3,262

Non-operating income

Non-operating expenses

Valuation loss on investment securities

129,62163,612Foreign exchange loss

347,811294,533

Sundry losses

13,01355,661

Total non-operating expenses
Recurring profit

525,515455,206

4,483,397

2,070,293

1,051

34,061-64,160Extraordinary profit
Gain on sale of fixed assets
Reversal of allowance for doubtful accounts
Insurance benefits received

138,641-

Subsidies received

42,98130,787

Gain on reversal of special retirement benefit
expenses for prior year-

21,016

Gain on business transfer-

41,000

Other
Total extraordinary profit

100-

182,773

191,027

Extraordinary losses
Loss on sale of fixed assets

1,851

273

Loss on disposal of fixed assets

48,57935,956

Total extraordinary losses

50,43036,230

Profit before income taxes

4,615,740

2,225,091

Income taxes - current

1,137,750

554,891-(28,543)

Prior year income tax, etc.
Income taxes - deferred
Income taxes
Minority interests
Net income- 19 -

556,882

206,087

1,694,632

732,436354,22150,4142,566,886

1,442,240

(Consolidated statements of changes in equity)(Thousands of yen, rounded down)
From June 1, 2008 to May 31, 2009

From June 1, 2009 to May 31, 2010

Balance at end of previous fiscal year

7,692,575

7,692,575

Balance at end of the fiscal year

7,692,575

7,692,575

Balance at end of previous fiscal year

9,534,686

9,534,686

Balance at end of the fiscal year

9,534,686

9,534,686

28,558,305

30,856,790

42,627-

EquityCommon stock

Capital surplus

Retained earnings
Balance at end of previous fiscal year
Change resulting from changes in accounting
methods at foreign subsidiaries
Change in the fiscal year
Dividends from retained earnings(311,028)(414,691)

Net income

2,566,886

1,442,240

Total change in the fiscal year

2,255,858

1,027,549

Balance at end of the fiscal year

30,856,790

31,884,339(53,599)(56,997)(3,397)(410)

Treasury stock
Balance at end of previous fiscal year
Balance at end of the fiscal year
Acquisition of treasury stock
Total change in the fiscal year

(3,397)(410)

Balance at end of the fiscal year

(56,997)(57,408)

45,731,968

48,027,055

42,627-

Dividends from retained earnings(311,028)(414,691)

Net income

Total equity
Balance at end of previous fiscal year
Change resulting from changes in accounting
methods at foreign subsidiaries
Change in the fiscal year
2,566,886

1,442,240

Acquisition of treasury stock(3,397)(410)

Total change in the fiscal year

2,252,459

1,027,138

Balance at end of the fiscal year

48,027,055

49,054,194- 20 -

(Thousands of yen, rounded down)
From June 1, 2008 to May 31, 2009

From June 1, 2009 to May 31, 2010

29,684

984

Change in the fiscal year in items other thanshareholders’ equity (net)(28,699)

857

Total change in the fiscal year

(28,699)

857

Balance at end of the fiscal year

984

1,842

(155,283)(623,226)

Change in the fiscal year in items other thanshareholders’ equity (net)(467,943)(607,808)

Total change in the fiscal year

(467,943)(607,808)

Balance at end of the fiscal year

(623,226)(1,231,034)(125,598)(622,241)

Change in the fiscal year in items other thanshareholders’ equity (net)(496,643)(606,950)

Total change in the fiscal year

(496,643)(606,950)

Balance at end of the fiscal year

(622,241)(1,229,192)--

Change in the fiscal year in items other thanshareholders’ equity (net)

-

6,696

Total change in the fiscal year

-

6,696

Balance at end of the fiscal year

-

6,696

917,228

1,202,030

284,802(73,473)

Revaluation and translation gains (losses)
Unrealized gains (losses) on available-for-salesecurities
Balance at end of previous fiscal year
Change in the fiscal year

Foreign currency translation adjustments
Balance at end of previous fiscal year
Change in the fiscal year

Total revaluation and translation gains (losses)
Balance at end of previous fiscal year
Change in the fiscal year

Share warrants
Balance at end of previous fiscal year
Change in the fiscal year

Minority interests
Balance at end of previous fiscal year
Change in the fiscal year
Change in the fiscal year in items other thanshareholders’ equity (net)Total change in the fiscal year

284,802(73,473)

Balance at end of the fiscal year

1,202,030

1,128,557

46,523,598

48,606,845

42,627-

Dividends from retained earnings(311,028)(414,691)

Net income

2,566,886

1,442,240(3,397)(410)

Change in the fiscal year in items other thanshareholders’ equity (net)(211,840)(673,728)

Total change in the fiscal year

2,040,618

353,40948,606,845

48,960,255

Total equity
Balance at end of previous fiscal year
Change resulting from changes in accounting
methods at foreign subsidiaries
Change in the fiscal year

Acquisition of treasury stock

Balance at end of the fiscal year

- 21 -

(Consolidated statements of cash flows)(Thousands of yen, rounded down)
From June 1, 2008 to May 31, 2009

From June 1, 2009 to May 31, 2010

4,615,740
3,291,319
10,9062,225,091
3,753,073
10,906

178,414265,921

Cash flows from operating activities
Profit before income taxes
Depreciation
Amortization of goodwill
Increase (decrease) in reserve for employees’ retirement
benefits
Insurance benefits received
Gain on reversal of retirement benefit expenses for prioryear
Decrease in long-term accrued amount payable (directors’
retirement benefits)
Increase (decrease) in reserve for employees’ bonuses
Increase (decrease) in reserve for directors’ bonuses
Increase (decrease) in allowance for doubtful accounts
Interest and dividend income
Interest expenses
Foreign exchange loss (gain)
Valuation loss (gain) on investment securities
Gain on sale of tangible fixed assets
Loss on disposal and sale of tangible fixed assets
Loss (gain) on sale of investment securities
Decrease (increase) in notes and accounts receivable trade
Decrease (increase) in inventories
Increase (decrease) in notes and accounts payable - trade
Other
Sub-totalInterest and dividend received
Interest paid
Insurance benefits received
Income taxes paid
Net cash provided by operating activities
Cash flows from investing activities
Payments for time deposits
Proceeds from time deposits
Payments for acquisition of tangible fixed assets
Proceeds from sale of tangible fixed assets
Payments for acquisition of intangible fixed assets
Payments for acquisition of investment securities
Proceeds on redemption of investment securities
Other
Net cash used in investing activities
Cash flows from financing activities
Net increase (decrease) in short-term borrowings
Proceeds from long-term borrowings
Repayment of long-term borrowings
Repayment of finance lease payables
Payments for acquisition of treasury stock
Payments for dividends
Payments for dividends to minority interests
Net cash provided by (used in) financing activities
Effect of exchange rate changes on cash and cash equivalents
Increase (decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of period
Cash and cash equivalents at end of period- 22 -(138,641)--(21,016)(699,000)(2,700)(70,296)(16,002)69,714(107,607)
33,193
347,811
129,621(1,051)50,430(100)(41,658)(35,840)(103,232)(99,419)
38,137
294,533
63,612(34,061)
36,230-2,771,573(2,597,843)(2,680,205)(381,308)(572,414)
6,832,097
94,682(31,590)
608,509(2,398,245)
5,105,453(1,643,423)
826,525
472,8123,407,647
112,887(36,689)(106,602)
3,377,242(8,054,331)
3,558,326(4,379,292)
5,285(54,186)(99)
500,000
4,281(8,420,016)(6,325,902)
11,822,295(9,223,112)
147,857(533,324)(1,199)9,694(4,103,690)

302,011(530,825)(2,870)(3,397)(311,028)(22,196)(568,307)(196,656)(4,079,525)
10,491,890
6,412,364

382,089
553,594(177,305)(7,516)(410)(414,091)(83,468)
252,891(136,395)(609,951)
6,412,364
5,802,412

(Segment Information)
a. Business Segment Information
Previous consolidated fiscal year (from June 1, 2008 to May 31, 2009) and the consolidated fiscal year underreview (from June 1, 2009 to May 31, 2010)
Business segment information has been omitted because the entire business of the Company and its
subsidiaries falls under the single business category of carbon product related business.
b.

Geographic Segment Information(From June 1, 2008, to May 31, 2009)(Thousands of yen, rounded down)

Japan

North
America

Europe

Asia

Total

Corporateand Elim.

Consolidated(1) Sales to unaffiliatedcustomers

16,528,392

3,457,257

2,977,092

8,011,563

30,974,306-

30,974,306(2) Intersegment sales ortransfers

6,162,566

106,146

5,088

101,968

6,375,769(6,375,769)

-

Total

22,690,959

3,563,403

2,982,181

8,113,531

37,350,075(6,375,769)

30,974,306

21,004,357

2,936,539

2,652,005

6,032,702

32,625,605(6,392,527)

26,233,077

I. Sales and operating profit

Operating Expenses
Operating Profit
II. Assets

Notes:

1.
2.

3.
4.
5.

6.

1,686,601

626,864

330,176

2,080,828

4,724,470

16,757

4,741,228

53,418,565

2,634,384

3,066,646

8,641,737

67,761,334(8,940,272)

58,821,061

Countries or regions are grouped together based on geographic proximity.
The major countries or regions included in each geographic segment (except Japan) are listed
below.
(1) North America:·······United States(2) Europe:···················France, Germany, Italy(3) Asia:·······················China, Taiwan
Unallocated amounts for operating expenses for the above period are not included in Corporate andEliminations.
There are no assets that are included in Corporate and Eliminations in the above period.
Changes in the methods of converting the revenues and expenditure of foreign subsidiaries:
The revenue and expenditure of foreign subsidiaries were previously converted into yen based on
the spot exchange rate on the closing date. However, commencing the first quarter of this fiscal
year, they are converted into yen based on the average exchange rate for the period. In accordancewith this change, sales in the regions of “North America”, “Europe” and “Asia” increased in thisconsolidated fiscal year by 111,289 thousand yen, 146,086 thousand yen and 171,035 thousand yen,respectively, and operating profit increased by 19,173 thousand yen, 10,771 thousand yen and
45,686 thousand yen, respectively, in comparison with the previous method.
Changes in durable years of tangible fixed assets:
The Company and its domestic consolidated subsidiaries reviewed and shortened the durable yearsof tangible fixed assets for this consolidated fiscal year, in the wake of the revision of the legal
durable years of machinery and equipment in the tax system revision for fiscal 2008. As a resultof this change, the operating profit in the “Japan” region decreased by 379,635 thousand yen in thisconsolidated fiscal year.

- 23 -

(From June 1, 2009 to May 31, 2010)(Thousands of yen, rounded down)

Japan

North
America

Europe

Asia

Total

Corporateand Elim.

Consolidated(1) Sales to unaffiliatedcustomers

15,546,466

2,487,339

2,637,299

7,253,748

27,924,853-

27,924,853(2) Intersegment sales ortransfers

5,304,695

24,936

2,232

102,492

5,434,356(5,434,356)

-

Total

20,851,162

2,512,275

2,639,531

7,356,240

33,359,210(5,434,356)

27,924,853

20,318,244

2,520,261

2,514,971

6,220,756

31,574,234(5,902,521)

25,671,713

I. Sales and operating profit

Operating Expenses
Operating profit (loss)
II. Assets

Notes:

1.
2.

3.
4.
c.

532,917(7,985)124,560

1,135,483

1,784,975

468,164

2,253,140

54,700,185

2,378,375

2,598,410

10,591,361

70,268,333(8,482,103)

61,786,229

Countries or regions are grouped together based on geographic proximity.
The major countries or regions included in each geographic segment (except Japan) are listed
below.
(1) North America:·······United States(2) Europe:···················France, Germany, Italy(3) Asia:·······················China, Taiwan
Unallocated amounts for operating expenses for the above period are not included in Corporate andEliminations.
There are no assets that are included in Corporate and Eliminations in the above period.

Overseas Sales(From June 1, 2008 to May 31, 2009)(Thousands of yen, rounded down)

North America
I Overseas Sales
II Consolidated Sales
III Overseas sales as a proportion of
consolidated sales (%)

Notes:

EuropeAsia

3,295,845

3,561,262

10,392,514

Rest of World
298,532

17,548,154

Total

-

-

-

-

30,974,306

10.6

11.5

33.6

1.0

56.7

1.
2.

Countries or regions are grouped together based on geographic proximity.
The major countries or regions included in each geographic segment (except Japan) are listed
below.
(1) North America:·······United States(2) Europe:···················France, Germany, Italy(3) Asia:·······················China, Taiwan
3. The overseas sales are the sales of the Company and its consolidated subsidiaries in countries orregions excluding Japan.
(Thousands of yen, rounded down)(From June 1, 2009 to May 31, 2010)
North America

I Overseas Sales
II Consolidated Sales
III Overseas sales as a proportion of
consolidated sales (%)

Notes:

1.
2.

3.

EuropeAsia

Rest of World

Total

2,376,858

3,058,813

10,017,593

180,003

15,633,269

-

-

-

-

27,924,853

8.5

11.0

35.9

0.6

56.0

Countries or regions are grouped together based on geographic proximity.
The major countries or regions included in each geographic segment (except Japan) are listed
below.
(1) North America:·······United States(2) Europe:···················France, Germany, Italy(3) Asia:·······················China, Taiwan
The overseas sales are the sales of the Company and its consolidated subsidiaries in countries orregions excluding Japan.
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