TOYO TANSOFirst Half Results for the Fiscal Year Ending May 31, 2010

January 2010
Toyo Tanso Co., Ltd.
Copyright © Toyo Tanso Co., Ltd. All Rights Reserved

Table of Contents

1-1. Remarks on First Half Results for the Fiscal Year Ending May 31,
2010
1-2. Business Results
1-3. Results for the First Half of the Fiscal Year Ending May 31, 2010
1-4. Factors Affecting Changes in Recurring Profits
1-5. Overview of Operations by Product and Segment
1-6. Overview of Net Sales by Region
2-1. Forecast for the Fiscal Year Ending May 31, 2010
2-2. Investments in the Future (Capital Investment, Depreciation Cost,
R&D Cost)
2-3. Return to Shareholders
2-4. Major Business Indexes
3-1. Topics
3-2. LED Applications, where Significant Steps forward Are Expected(Reference 1) Balance Sheet for the First Half of the Fiscal YearEnding May 31, 2010
(Reference 2) Statement of Cash Flows for the First Half of the Fiscal
Year Ending May 31, 2010

Copyright © Toyo Tanso Co., Ltd. All Rights Reserved

P. 3
P. 4
P. 5
P. 6
P. 7
P.10
P.11
P.12
P.13
P.14
P.15
P.16
P.20
P.21

2

1-1. Remarks on First Half Results for the Fiscal Year Ending
May 31, 2010
 Remark 1
Dragged down by the effects of the global recession, demand continues to stagnate,
and even though we focused all our energy on the unearthing and uptake ofdemand, we have seen significant reductions in income and profits.
 Remark 2
However, we have covered the situation partially with efforts to reduce costs,
ensuring a profit ratio of at least 5%. As a result, we have ended up clearing ourforecast figures.
 Remark 3
Taking the first quarter as the bottom, we are now recovering slowly, mainly in
products for solar cells and semiconductors. (Results for products for compound
semiconductors were particularly positive.) Remark 4
Even though the future continues to be uncertain, trends in both the sure-footed
return of demand and prices were as initially anticipated and we will make nochanges to forecasts for the full term.
Copyright © Toyo Tanso Co., Ltd. All Rights Reserved31-2. Business Results(Unit: Yen, millions)

Net sales

Recurring profit

40,00012,00034,53135,00031,38130,97430,00025,49225,00010,00028,000
7,795

23,003

8,000

7,123

20,000
4,961
15,0003,724

17,97917,372

6,000
4,483

14,866
4,100

12,227

10,000

3,369
2,280

(2Q cumulative)

3,754

12,646

4,000
2,500

(2Q cumulative)(2Q cumulative)(2Q cumulative)

5,000(2Q cumulative)

661

0

2,000

05/5

06/5

07/5

08/5

09/5

10/5

0

(Forecast)
Copyright © Toyo Tanso Co., Ltd. All Rights Reserved41-3. Results for the First Half of the Fiscal Year Ending May 31, 2010

(Unit: Yen, millions)%
Change09/5
First Half

10/5
First Half

ChangeNet sales

17,97912,646(5,333)(29.7%)

Operatingprofit4,154

817(3,337)(80.3%)(Ratio of operating profit
to net sales)

Recurringprofit(Ratio of recurring profit
to net sales)( 23.1%)
3,754(20.9%)(6.5%)
661(3,092)(82.4%)(5.2%)

Profit before
income taxes

3,747

782

(2,965)(79.1%)Net income

2,379

369

(2,009)(84.5%)Net income
per share

114.76 yen

17.84 yenExchangerate

104.6 yen/$
162.7 yen/€

92.9 yen/$133.2 yen/€

Copyright © Toyo Tanso Co., Ltd. All Rights Reserved

Points- In almost all applications and regions,income is being dragged down
significantly under the impact of
substantial production and inventory
adjustment.
- While prices are within the expected
range, they have fallen slightly centeredon Chinese solar cells.
- However, in comparison to the firstquarter, second quarter results are on theroad to recovery with an 11% increase inincome even though there were losses oncurrency options.

- Echoing the fall in marginal profits
associated with the weakening of sales
and production, operating and recurring
profits declined significantly.
- Even though there were negative factors
such as the strong yen, these werecovered by efforts to reduce costs and thefall of raw material prices.
- As a result, while the situation is difficult,
we have secured profit rates of at least5%.
5

1-4. Factors Affecting Changes Recurring Profits
The main factor is the fall in marginal profits associatedwith the weakening of sales and production.

(Unit: Yen, millions)

Even though depreciation expenses
remained mostly flat due partly toinvestment contraction and the staggered
effects of previous investment, large
investments are scheduled for posting inthe second half

3,754

54

300

Change indepreciation Impact of
exchange
expenses
rates

09/5
First Half

Mostly due toefficiency reductions
associated withdecreases in operating
rates (mainly
processing work)

458
Product
structuredifferentials
and pricerevisions

About half of expenses are
due to sales price reductions(mainly products for Chinese
solar cells)

1,553

Change insales volumes

Streamlining
anddifference inoperating
rates

1,446

Change in Difference inrawother costs
materials
prices265
Reduced prices for bothmaterial coke and fuel(kerosene)

Copyright © Toyo Tanso Co., Ltd. All Rights Reserved

10/5First Half

661

453

Payroll and travel costs, etc,
reduced in fine detail61-5. Overview of Operations by Product and Segment(1) Net Sales(Unit: Yen, millions)(% change)

20,00018,00017,97917,372

17,15916,000
3,897

5,048

4,201

14,00012,000

9,451

8,902

9,066

4,219

0

3,220

3,793

819

2,666
399
1,233

448
1,041

1,704

1,915

3,096 2,544

2,761 2,349

551

411

1,453

1,537

609
1,502

2,487

2,110

2,377

4,000
2,000

3,666
6,733

950

6,000

12,6463,880

10,0008,000

12,994

3,780

3,086

4,145 3,369

4,198(-12.2%)

Special Graphite Products[General Industries
Applications](+5.1%)

Special Graphite Products[Others](+12.3%)

Carbon Products for
General Industries[Carbon Products for
Mechanical Applications](-15.5%)

Carbon Products for
General Industries[Carbon Products
for Electrical
Applications](+12.3%)Compound materials andOther Products[Three Major Products](-7.7%)

Compound materials andOther Products[Other Products](-25.3%)

6,472

2,803

3,395

694
584

776
463

450

226

08/5
First half

08/5
Second half

09/5
First half

09/5
Second half

Copyright © Toyo Tanso Co., Ltd. All Rights Reserved

Special Graphite Products[Electronics Applications]

803

456
10/5
First half

[Related goods](+101.6%)

7

1-5. Overview of Operations by Product and Segment(2) Remarks and Future Outlook (1/2)
Sales
image by application
用途別売上高イメージ用途
Application

Electronics
Electronics applications
applications

エレクトロニクス分野

Generalindustries
industriesapplications
applications
Generalandothersand others

一般産業分野・その他

特殊黒鉛製品Specialgraphite
graphiteproducts
products
Special09/
5 term 10/10/5月期
5 term 10/ 10/5月期
5 term09/5月期
SecondFirst
half
Second
3､4Q
1､2Q
3､4Q
half
half

ポイントおよび今後の見通し
Remarks and future outlook

Products for the
manufacture of solar cells- Still feeling the impact of the rapid decline and disruption of the market beginning in autumn 2008, demandis stagnating, centered on the core markets of China and Europe.
- In the first half of this term, the level of demand was slightly more than 60% of that at the peak (first half ofthe previous term). Demand slumped in the first quarter in particular, but turned around in the second quarterand is on the road to recovery.
- Towards the second half of the term, the macro environment is also improving, including measures in various
countries to support the spread of solar cell technology. Disruption is also coming gradually to an end anddemand continues to recover steadily centered on China.
- Along with concentrating on the incorporation of new demand in Japan and the countries of Asia, demand forthin film and compound systems (including C/C) is also covering the situation and we are currently planning
sales expansion and advancing plans for the second half (about 30% increase in comparison to the first half).

化合物半導体製造用
Products
for themanufacture of single
crystal silicon- The effects of customer inventory adjustments continue to drag out and demand is stagnating. Due in part also
to time lag, demand remains at slightly less than 60% of the level in the first half of the previous term.
- However, the operating rate for 300 mm wafers in particular has improved and with the progress inconsumption of graphite material inventories, demand is currently recovering mildly towards the second half.
- Because the macro environment surrounding semiconductors has brightened to this point, graphite is also
expected to improve further from the second half on.

Products for the
manufacture ofcompoundsemiconductors
放電加工電極用- Demand increased centered on products for white LEDs for use as LCD backlights, with products for South
Korea and Taiwan driving growth due mainly to new and expanded facilities.
- In addition, although small in scale, products for LEDs grew by a little less than 30% in comparison to the firsthalf of the previous term. Against the backdrop of good results for products such as notebook PCs, flat-screen
TVs and mobile phones, the outlook for the future is positive. (See the “LED Feature” below.)

Products for electricaldischarge machining
連続鋳造用・冶金用(EDM)
electrodes- Although demand both in Japan and overseas continued to be weak due mainly to the decline of the automobileand household appliance industries, the recovery has become clearer in China, where recovery has been quick.
In the second half, we managed to hold on to about 70 - 80% of demand during the peak period (first half of theprevious term).
- Competition is also intensifying under difficult business conditions in the die industry, but we are concentrating
on expanding market share armed with differentiated products (ultrafine particle structure graphite materials)

Products for continuous
casting and metallurgy,
etc- Against the backdrop of decreased capital investment associated with the economic recession, demand for
products for metallurgy, including continuous casting and industrial furnace-related products continued to moveon a weak note.
- However, the recovery following the bottoming out of the slowdown has been relatively quick.
Business turned to upswing in the second half of the first quarter and demand for the first half overall was at aslightly higher level than the second half of the previous term. China in particular made strenuous efforts andproducts for optical fiber, electronic materials and continuous casting drove growth.

Other special applications- Material shipments and the start of processing are scheduled from next term for high temperature gas reactors
in China (3 - 4 billion yen). (Sales postings are scheduled for the 12/5 term.)

太陽電池製造用

単結晶シリコン製造用

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81-5. Overview of Operations by Product and Segment(2) Remarks and Future Outlook (2/2)
Sales image by application

Carbon products formechanical applications

Carbon products forelectrical applications

Three major products

Compound materials and other products Carbon products for general industries

Application

Products for generalindustries

09/ 5 term
Secondhalf

10/ 5 termFirst half

Remarks and future outlook

10/ 5 term
Secondhalf- Demand for core products such as bearings and seals declined as a result of capital investment controls in
relation to petrochemical plants and pumps. We anticipate that more time will be required for recovery.
- We are concentrating on increases in overseas sales that was behind and getting a result.

Products for transportation-

Demand for pantograph sliders, which are affected only slightly by economic fluctuations, remained solid
although the market is small in scale. Increased sales to private railways also developed gradually.
Recovery in products for overseas markets is still a matter for the future.

Products for small motors- Although demand in China, the production base, was stagnating under the impact of the economic downturnin Europe and America, demand is recovering quickly centered on products for household appliances
following the bottoming out of the recession. In Japan, the situation continues to be relatively difficult.
- In the second quarter, demand recovered to a level of about 90% that of the peak period (first half of theprevious term). We will promote a global strategy centered on China and aim for further increases in sales.

Products for industry andautomobiles, etc- The uphill battle in the area of products for industrial use continues, but the decline in products forautomobiles (fuel pumps, etc) was small and with the excellent condition of hybrid vehicle products andproduct adoptions in motorbikes also providing support, recovery in this sector has become clear.

SiC coated graphite
products- Although demand for mainstay products for semiconductors (Si-Epi, etc) continues to be weak, there are signs
that the market is gradually bottoming out.
- As noted above, demand for products for compound semiconductors is steady. We are planning on further
increases in sales armed with consistent competitiveness all the way through from materials to processing tocoating.
- Total sales for the first half remained equivalent to the second half of the previous term, but we expect better
results in the second half against the backdrop of the expansion of products for compound semiconductors andthe recovery of semiconductor-related demand.

C/C composite products- In the area of large crucibles for the manufacture of 300 mm wafers we faced very difficult going due to theprolongation of operating reductions and inventory adjustment at our main customers. Products for solar cells
also slumped, dragged down by the disorder of market conditions.
- A little more time will be needed for recovery in demand for crucibles, including customer inventory
adjustment, but we do anticipate a gradual recovery in solar cell related products, including products for thinfilm type solar cells and new projects.
- Deliveries of the products for nuclear fusion reactors that were ordered last year have also started and fromthe fourth quarter onwards in particular, this sector will once again be on a growth track.

Graphite sheets- Mainstay products for automobiles and semiconductors took the lead in turning towards recovery and havereturned to a level slightly less than 90% of that at the peak (first half of the previous term). Demand forgraphite sheets appears likely to continue performing steadily in the future.

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91-6. Overview of Net Sales by Region
Although the scale of sales has contracted overall, our presencein the Asia region in particular has improved
and our overseas sales ratio continues at a high level (56.9%)(Unit: Yen, millions)

17,372Composition ratio
17,979Japan

17,159(43.1%)

Sales continue to stagnate under the impact of
production and inventory adjustment, mainlyin the semiconductor industry

12,994

12,646Asia(35.9%)

Although core products for solar cells are
performing weakly, brushes and compound
semiconductors are performing solidly and the ratioof sales for the region is expanding

Europe(11.1%)

Sales are stagnating in almost all
applications, centered on solar cells

North America(9.3%)In addition to the stagnation of products for the
manufacture of semiconductors and polysilicon,
products for solar cells are also stalling and theimmediate future looks difficult

Other regions

Copyright © Toyo Tanso Co., Ltd. All Rights Reserved(0.6%)

10

2-1. Forecast for the Fiscal Year Ending May 31, 2010
Remarks(Unit: Yen, millions)

09/5

10/5
(Forecast)

Change%Change- Underlying demand is heading for recovery
centered on core products related to solar
cells and semiconductors.
- In addition, although small in scale, sales of
products for compound semiconductors
centered on products for LEDs are growing
and becoming more noticeable.

Net
Net salessales

30,97428,000(2,974)(9.6%)

OperatingOperatingprofitprofit

4,741

2,500

(2,241)(47.3%)(Ratio of operating
profit to net sales)(15.3%)(8.9%)- Although prices are tending to fall, they are
forecast to trend largely within the initiallyanticipated range.

Recurring
Recurringprofitprofit

4,483

2,500

(1,983)(44.2%)(Ratio of recurring
profit to net sales)(14.5%)(8.9%)- Marginal profits are increasing inassociation with the return of sales andproduction (structurally high marginal
profit rates).

Net
Net income
income

2,566

1,500

(1,066)(41.6%)Net
Net income
incomeperper shareshare

123.80 yen

72.34 yenExchange
Exchangerate
rate

99.6 yen/$
143.5 yen/€(2nd half) 90 yen/$(2nd half) 130 yen/€

Copyright © Toyo Tanso Co., Ltd. All Rights Reserved- Despite the impact of the strong yen, thesituation is being covered with ongoing
efforts towards cost reductions, etc.
- The US$ is expected to fall against the yen(93 yen to 90 yen) (the Euro will not change).

- Although the future remains uncertain,
there will be no changes to the results
forecast for the full term in view of thesituation described above.
11

2-2. Investments in the Future(Capital Investment, Depreciation Cost, R&D Cost)
Investment will be largely as initially planned. The new factory for
isotropic graphite at Takuma is currently progressing as planned.
Large scale investment has come full circle and the value of(Unit: Yen, millions)(Unit: Yen, millions)investment in the next term will be at normal levels.
12,000

1,300
1,130

10,000

1,098

1,014
941

1,200

10,256

R&D cost (right axis)

1,000
900

8,000

800

731

700

6,000

5,484

5,437

5,113

4,000

600
4,444

4,300

4,255

3,291

3,255
2,166

2,091

1,392

1,709

649

746

(2Q cumulative)(2Q cumulative)

1,892
1,276

300
1,561

200
1,615

(2Q cumulative)

500
400

2,755
2,000

1,100

(2Q cumulative)(2Q cumulative)

0

100
0

06/5
Copyright © Toyo Tanso Co., Ltd. All Rights Reserved

07/5

08/5

09/5

10/5
(Forecast)122-3. Return to Shareholders Changes in Dividend
Dividend

Dividend payout ratio
30%

35 yenDividend per share(30)

Dividend per share

30 yen

27.6% (30)25%

(Figures take stock split
into consideration.)

25 yenDividend payout ratio(consolidated)(22.5)
20

20 yen15

15 yen
10 yen

20%

20
15%

16.2%

12
10%

10

5%

6.1%

5 yen

4.1%

3.6%

0 yen

0%
06/5

07/5

08/5

09/5

10/5
(Forecast)* The Company conducted a 1.5-for-one stock split on June 1, 2007
Copyright © Toyo Tanso Co., Ltd. All Rights Reserved

132-4. Major Business Indexes

Recurring profit ratio
ROE
ROA

25%

22.7%

20%

22.6%

19.5%

14.5%

15%
11.3%
10%

12.4%

11.9%

8.9%

9.1%

8.9%

7.1%
5.5%
5%
4.4%
0%
06/5
Copyright © Toyo Tanso Co., Ltd. All Rights Reserved

07/5

08/5

09/5

10/5
(Forecast)14

3-1. Topics
New factory construction progressing at overseas subsidiaries
New factory construction is progressing at various overseas subsidiaries in order to respond to the businessexpansion associated with the broadening of the areas of use of graphite products.
In China, Shanghai Toyo Tanso is currently constructing a new factory aiming to start operations in spring
this year. This will reinforce the company’s ability to process high performance materials, for which demandis expected to increase, such as materials for solar cells and high temperature gas reactors.
In Germany, starting with the new factory completed and relocated to last year, GTD GRAPHITTECHNOLOGIE GmbH is currently progressing development towards a wide range of industries including
solar cells, semiconductors and automobiles.
The company will continue to promote responses to increasingly sophisticated and diversifying user needs
after determining the economic situation and industry trends, etc.

The new factory at Toyo Tanso’s
German subsidiary

Drawing attention to the technological prowess and track recordof the company group through participation at exhibitions
Toyo Tanso is participating proactively in exhibitions in various countries in order to draw the attention of theoutside world to the technological prowess and track record of the company group
At the 2nd International Business Forum for Fusion/ Fission Energy held in Sapporo, Hokkaido in September
last year, we introduced visitors to our efforts over many years in the nuclear power field as well as our hightechnological capabilities in the area.
At the Taiwan International Photovoltaic Forum and Exhibition (PV Taiwan 2009) held in Taiwan in October,
Toyo Tanso Taiwan, the company’s Taiwanese subsidiary, exhibited various solar cell-related products.
Toyo Tanso plans to participate positively in exhibitions held in various countries in the future too, aimed at
the further global development of the group.

The Taiwan International
Photovoltaic Forum and Exhibition

Toyo Tanso will also participate this year in the 3rd International Photovoltaic Power Generation Expo PV EXPO 2010
PV EXPO is the largest exhibition in the solar cell industry in Asia, and provides a venue for the powerful companies of the world to come together
under the same roof.
Toyo Tanso will also participate this year in 3rd International Photovoltaic Power Generation Expo PV EXPO 2010 (March 3 - March 5, 2010;
Tokyo Big Site).
We plan to appeal to our results and experience as well as the superiority of our technology through an exhibition of actual solar cell-related graphite
products and panels.
Copyright © Toyo Tanso Co., Ltd. All Rights Reserved15

3-2. LED Applications, where Significant Steps forward Are Expected(1) LED Overview
About LEDs
The term “LED” is an abbreviation of “Light Emitting Diode.” Known also as luminescent diodes, an LED
releases energy when a voltage is applied = an LED is a type of light-emitting compound semiconductor.

P Power saving

 Consumed electricity is 1-tenth that of incandescent bulbs

L Lighter, reduced

 LEDs are smaller and lighter in comparison to conventional lightsources, and contain none of the mercury found in fluorescent lights

environmental burden

L Long-life LEDs have operating lives 40-times longer than incandescent bulbs

LEDs are available in all 3 primary colors (red, green, blue) since the development of the blue LED in 1993
Use of graphite in the LED manufacturing process
To enable the realization of white LED light<<White LED color rendition method>>White LED light cannot be realizedusing an LED element alone

1) Blue LED + yellow fluorescent light2) Red LED + green LED + blue LED
3) Ultraviolet LED + red/ green/ blue
fluorescent light

Copyright © Toyo Tanso Co., Ltd. All Rights Reserved

The color of LED light is different depending on thecompound used, but graphite materials are used in the LED
manufacturing process whether the color is red, green or
blue, and Toyo Tanso products are also used in the LED
manufacturing process of each color.
LED color

CompoundMain graphite material used

Blue

GaN

With coating

Green

GaP

Without coating

Red

GaAs

With coating16

3-2. LED Applications, where Significant Steps forward Are Expected(2) The Roles of Toyo Tanso Products
GaN LED manufacturing process<Manufacturing process for the blue LED, the key to manufacture of the white LED>

(Image: LCD backlight)

Substrate (sapphire, etc)
Sapphire substrates are
generally used if manufacturing
a blue LED element.

GaN semiconductor crystal
film formation by MOCVD(Incorporation into
final product)

Electrode formation, chipprocessing after cutting

Process using Toyo
Tanso products

Modularization(Image: Example lighting application)

Toyo Tanso products are also used forinternal furnace parts used in the manufactureof the single crystals (sapphire, GaAs single
crystals, etc) that provide the substrate.

Packaging of LED chip, sealing material,reflector, etc

Susceptors
MOCVD (metal organic chemical vapor deposition)
MOCVD is a crystal film growth(epitaxial growth) method thatuses metalorganics and gas for
raw materials.

Epitaxial growth layer

The raw materials are vaporized Metalorganic, gas
Substrate
under high temperature andpressure, and semiconductor
crystals are formed on a substrateby initiating a chemical reaction
upon it. It is said that if thetemperature of a sapphire
substrate differs by 1℃, thewavelength of the LED (its color)
Heaterwill differ by 1 nm, so this is aprocess that exerts a significant<Diagram of MOCVD
impact on the quality of the LED.

equipment>

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The material used as the substrate pedestal whenforming a crystal film by MOCVDHigh purity, heat stability and conductivity are called for.
Adoption of graphite materials
Graphite degrades easily in the high temperature ammonia atmospherepresent when forming GaN semiconductor crystal films.

SiC coated graphite materials are used
Technology is required that is strong in areas such as durability against
ammonia, dimensional accuracy and the realization of smooth SiC films.

17

3-2. LED Applications, where Significant Steps forward Are Expected(3) Market Trends
Market trends(Unit: Yen, billions)* Estimations made by Toyo Tanso
based on various data.

500■ Small and medium sized LCDs (mobile phones, etc)

400

■ For automobiles■ For lighting

300■ Others (large LCDs)

200

100

0

06

07

08

09
(Forecast)

10(Forecast)

11(Forecast)

12(Forecast)

Overview of the market(Expectations for 2009)- While the difficult economic environment will continue, the LED market is scheduled to achieve positive growth in2009 in comparison to the previous year.
- The growth driver has switched from mobile phones to backlights for LC TVs.
( Expectations for the future)- LED adoption as backlights for LC TVs and lighting equipment will start in earnest with an annual rate of increaseof about 20%.
- Market size for 2012 is estimated to be about double that for 2008.
Copyright © Toyo Tanso Co., Ltd. All Rights Reserved18

3-2. LED Applications, where Significant Steps forward Are Expected(4) The Toyo Tanso Development Situation and Strategy
TOYOLED向け売上地域別シェア
Sales trend by region
for products for LED applications

The Toyo Tanso development situation(Overview)- Sales to South Korea and Taiwan inparticular centered on products forbacklights for LCDs have increased
rapidly since the first quarter inassociation with the new and expanding
construction of MOCVD facilities.

200

Relative values indexed against May 2007 (100)

150
100

- Sales for the last fiscal year were a few

percent of overall sales (of those, about
half were overseas sales)

50- The proportion of coated products isincreasing rapidly.

007/5- Market share in the area of compound

semiconductors is top at an estimated40 - 50% (excluding pure products)

08/5

09/5

09/5

10/5

10/5

First half

Second halfFirst halfFirst half

Total

Japan

South Korea
TaiwanEurope,USA, etc

Development strategy and issues- Further reinforcement of competitiveness in consistency from materials to processing to coating (costs, quality,
technological services)- Expansion and upgrading of production capabilities (coating)- Promotion of multifaceted development (including investigation of collaboration with equipment manufacturers)
and promotion of customer retention- Promotion of globally-responsive proposals and sales activities by global specialist units that transverse theorganization, regions and company- Concentrated input of management resources in Japan and Asia, where further growth is expected
Copyright © Toyo Tanso Co., Ltd. All Rights Reserved

19

(Reference 1) Balance Sheet for the First Half of the Fiscal YearEnding May 31, 2010

(Unit: Yen, millions)

08/11

09/5

09/11

Total
Total assets
assets60,097

58,821

59,624Trade
Trade notes
notes and
andaccounts
receivableaccounts receivable

10,731

8,257

8,519

Inventory
Inventory

8,496

9,520

10,289Tangible
Tangible fixed
fixed assets
assets21,547

23,20825,807

Total
Total liabilities
liabilities andandnet
net assets
assets60,097

58,821

59,624

Interest-bearing
Interest-bearing debt
debt

1,604

1,394

1,911

Paid-in
Paid-in capital
capital

7,692

7,692

7,692

Net
Net assets
assets

48,641

48,60647,726EquityEquity ratio
ratio

79.0%

80.6%

78.2%

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Remarks- Increased 769 million yen
compared to the end of 09/
5 due to factors including
the planned accumulationof intermediate inventories.

- Increased 2,599 million yen
compared to the end of 09/
5 due to factors including
the reinforcement ofisotropic graphite andvalue added processing.

20

(Reference 2) Statement of Cash Flows for the First Half of the Fiscal
Year Ending May 31, 2010

(Unit: Yen, millions)

09/5
First Half

10/5
First Half

Cash and cash equivalents at
the end of the period

7,770

4,678

Changes in cash and cash
equivalents(2,721)(1,734)

Cash and cash equivalents atthe beginning of the period

10,491

6,412

CF from operating
activities

4,384

1,703

CF from investing
activities(6,687)(3,349)CF from financing
activities

(369)

48

Copyright © Toyo Tanso Co., Ltd. All Rights Reserved

Remarks

Increase due to refunds ofdepreciation expenses,
corporation taxes, etc.

Expenditures due to theacquisition of tangible fixed
assets21

Note: This presentation contains “forward-looking statements” and forecasts of business results. Thesestatements are not historical facts but instead represent the Company’s beliefs regarding future
events, many of which, by their nature, are inherently uncertain and out of the Company’scontrol. It is possible that the Company’s actual results may differ, possibly materially, from theanticipated results and financial condition indicated in these forward-looking statements.
IR Contact
E-mail: ir@toyotanso.co.jp

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22