Consolidated Financial Statements for the First Quarter of Fiscal Year Ending March 31, 2013
(Three Months Ended June 30, 2012) (Based on J-GAAP)
August 8, 2012
Company Name : Nippon Manufacturing Service Corporation.
Listing : JASDAQ (Osaka Securities Exchange)
Stock Code: 2162
URL : http://www.n-ms.co.jp/
Representative: Fumiaki Ono,
President and CEO
Contact: Norihiko Suehiro, Executive Director and CFO
Tel: +81-3-5333-1711
Scheduled Date of Filing Quarterly Securities Report: August 8, 2012
Scheduled Commencement Date of Dividend Payout: —First Quarter Financial Results Presentation Materials: Yes
Explanatory Meeting on First Quarter Financial Results : None
(All amounts are rounded down to the nearest million yen)

1. Consolidated Financial Results for the First Quarter of Fiscal Year Ending March 31, 2013 (April 1, 2012 – June 30, 2013)(1) Consolidated results of operations (three months)(Percentages represent year-over-year changes)
Net sales
Operating income
Ordinary income
Net income
Million yen%
Million yen%
Million yen%
Million yen
%
8,172
52.8
192
327.7
243
—
107
—
1Q FY 2013
5,346
—
45
—
21
—
(0)
—
1Q FY 2012
(Note) Comprehensive income (million yen): 1Q FY 2013: 436 (—%)
1Q FY 2012: (12) (—%)
Net income per share

Diluted net income per shareYen
Yen
1Q FY 2013
1,047.39
1,006.44
1Q FY 2012(7.46)—
Note 1: Quarterly consolidated financial statements were first prepared beginning with the second quarter of the fiscal year ended March 31, 2011.
Changes for the first quarter of the fiscal year ended March 31, 2012 compared with the same quarter a year earlier are therefore not stated.
Note 2: With regard to diluted net income per share data for the first quarter of the fiscal year ending March 31, 2012, although dilutive
instruments are in issue, diluted net income per share is not stated since a net loss was reported for the period.
(2) Consolidated financial position
Total assets
Net assets
Equity ratio
Million yen
Million yen
1Q FY 2013
19,3256,236
FY 201218,7095,839
Reference: Shareholders’ equity (million yen): 1Q FY 2013: 3,543
FY 2012: 3,343

%
18.3
17.9

2. Dividends
1Q-endInterimYen

FY 2012FY 2013
FY 2013(forecasts)

Yen
0.00

—
—

Annual dividends
3Q-endYen—

0.00

Yearend—AnnualYen
400.00Yen
400.00300.00300.00Note: Revision of the latest released dividend forecast: None

3. Consolidated Forecasts for the Fiscal Year Ending March 31, 2013 (April 1, 2012 – March 31, 2013)(Percentages represent year-over-year changes)

Net sales
1H (six months)
Full year

Million yen
19,00045,000

%
72.6
41.4

Operating income

Ordinary income

Million yen
360
1,000

Million yen
415
1,050

%
141.1
297.5

Note: Revision of the latest released business performance forecast: None

%
394.1
294.3

Net income
Million yen
190500

Net income per
share
%
Yen
(85.1)
1,758.36(63.1)
4,627.27

4. Others(1) Changes in significant subsidiaries during the consolidated quarter (three months) under review(changes in subsidiaries accompanying change in the scope of consolidation): None
New:
None (Company name:)
Excluded: None (Company name:)(2) Application of accounting procedures specific to creation of quarterly consolidated financial statements: Yes(Note)For details, refer to "2. Summary (Other) Information: (2) Application of accounting procedures specific to creation of quarterly
consolidated financial statements on page 4 of the Attachment.

(3) Change of accounting policies; change and/or restatement of accounting estimates
1) Change of accounting policies caused by revision of accounting standards:
2) Change of accounting policies other than stated in (1):3) Change of accounting estimates:
4) Retroactive restatement:

Yes
None
Yes
None

(Note)For details, refer to "2. Summary (Other) Information: (3) Change of accounting policies; change and/or restatement of accounting
estimates" on page 4 of the Attachment.

(4) Number of shares issued and outstanding (shares of common stock)1) Number of shares outstanding (including
treasury stock) at end of period
2) Number of treasury stock at end of period
3) Average number of shares outstanding
during the period

1Q FY 2013

108,055 shares

FY 2012

108,055 shares

1Q FY 2013

5,815 shares

FY 20125,815 shares

1Q FY 2013

102,240 shares

1Q FY 2012

99,540 shares* Implementation of quarterly review proceduresThis summary of quarterly financial statements is not subject to quarterly review procedures pursuant to the Financial
Instruments and Exchange Act. At the time of disclosure of this summary of quarterly financial statements, the review
procedures of quarterly financial statements pursuant to the FIEA were completed.
* Cautionary statement with respect to forward-looking statements
The forward-looking statements such as the forecasts for the business performance described in this document are basedon the judgments made by the Company in accordance with information currently available that is rational. For this reason,
actual results may differ from these forecasts due to a number of factors, including but not limited to the operating
environment. For the underlying assumptions and usage of earnings projections refer to the disclaimer in “(3) Qualitative
information concerning business performance forecast” under “1. Qualitative Information Concerning Financial Results of
the Quarter under Review” on page 4 of the Attachment.
(How to obtain Quarterly Financial Results Presentation Materials)
Quarterly financial results presentation materials are published on the same day on TDnet.

Nippon Manufacturing Service Corporation. (2162) /Consolidated Financial Results for First Quarter of Fiscal Year Ending March 31, 2013
(Three Months Ended June 30, 2012) (Based on J-GAAP)

1. Qualitative Information Concerning Financial Results of the Quarter under Review

Forward-looking information included in the text reflects the judgment of the nms Group (the Company and consolidated
subsidiaries) as of the end of the consolidated quarter under review.

(1) Qualitative information concerning consolidated operating results
In the period under review, the world economy is yet to eliminate sovereign risks in Europe where economic crisis of Spain isfeared following Greece, and slower economic growth of China and developing nations adds to concerns in forecast. European
debt crisis, after more than two and half years, is yet to conclude and extent of damage to world economy is unforeseeable if
situation becomes more severe.
Meanwhile, future of Japanese economy remains unclear; it has been unable to find a way to depart from the deflationary
economy, and aging society combined with falling population adds to the burden of social security cost on national finances. In
today’s trend toward service economy, manufacturing industry, which is Japan’s key industry, struggles from strong yen, highcorporate tax rates, delay in trade liberalization, and electricity supply restriction, all in addition to the uncertainties toward
European economic crisis, and it significantly lacks global competitiveness.
Under these conditions, many manufactures in our industry are shifting their manufacture bases to overseas, making it moredifficult to maintain and expand business as in the past. Natural disasters last year urged manufactures to review theirprocurement, production and supply structures from BCP point of view, and manufacturers began restructuring their manufacturebases at a speed far beyond the industry expectation. In addition, more manufactures are requesting to reduce their cost in orderto maintain cost competitiveness in domestic production, forcing our industry to control cost per hire, affecting considerably inrecruiting activities. Even industry leaders with competitive advantages have difficulty securing appropriate number of workers
with proper cost, and in some cases mid-size regional companies without competitive edge are beginning to have difficulty
continuing their business.
Occasioned by these developments, nms Group (the Company and its consolidated subsidiaries) has formulated a businessstrategy concept (“neo EMS”) under which the Group will promote business initiatives that address key issues of the Group’s
individual operations. The Group has been successful to a certain degree in regard to these efforts. Specific measures include thefollowing:- Inline Solutions (IS) operations: Raise the domestic competitive strength of the Group’s core business, and develop overseas
market- Customer Service (CS) operations: Pursue high-margined business models, expand domestic operations, and make preparations
to enter overseas market- Global Engineering (GE) operations: Pursue synergies between operations, recognizing that such operations are indispensablefor “neo EMS”
- Electronics Manufacturing Service (EMS) operations: Aim for greater group manufacturing prowess and re-establish a businessplatform for domestic and overseas operations
In the period under review, business environment was severe for nms Group who operates manufacturing outsourcing services
under “neo EMS” business strategy concept described above. Nevertheless, the Group was able to record strong results by
pursuing operational synergy between business segments.
As a result, consolidated sales for the first quarter increased 52.8% to 8,172 million yen, with operating income of 192 million
yen (+327.7% on the year), ordinary income of 243 million yen (+1,010.2% on the year), and net income of 107 million yen(near break-even the prior year).
Segment results developed as follows.
Note that from the period under review, changes have been made in calculation of profit or loss of reportable segments. As
regards the comparisons made with the same quarter of the previous year that appear in the following financial result summaries
for each segment, the figures for the previous year have been reclassified to take account of the new segment decisions so as toenable direct comparison.
[1] Inline Solutions (IS) operations
Japanese manufacturers are restructuring their base strategies according to manufacturing functions from global perspective,
taking into account lessons learned from massive natural disasters last year. All manufacturing processes including material
procurement activity, production activity (substrate mounting and product assembly), and supply activity are being reviewed
strategically. The Group’s manufacturing clients are looking ahead to what each place of procurement, production, andconsumption should be, and are advocating establishment of internationally diversified manufacturing bases in a mid-and-longterm standpoint in light of severe business environment with so-called six-fold difficulties including strong yen which issignificantly weakening international competitiveness of domestic production.
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(Three Months Ended June 30, 2012) (Based on J-GAAP)

Under these circumstances, for the period under review, domestic IS operations gained a high reputation from clients because incomparison to other companies, the Group possesses: overwhelmingly broad range of solution menus available in “neo EMS”
business development; an advantage in contract manufacturing thanks to its consistent commitment to manufacturing; an ability
to make global proposals including overseas production, by having multiple overseas bases for EMS operations and overseas
staff dispatch. As a result of foregoing combined with aggressive marketing, enrollment has reached its highest since theLehman Brothers’ fall.
Especially for manufacturing clients considering production transfer to overseas, the Group’s ability to offer services such as
overseas manufacturing outsourcing and contract manufacturing, not to mention the ability to meet the domestic outsourcing
needs, has enabled the Group to achieve perfect discrimination, and aggressive sales and marketing activities were promoted in
China and Vietnam respectively in full cooperation with Beijing Zhongji Zhonghe International Technical Services Ltd.
(“Zhongji Zhonghe”) and nms International Vietnam Company Limited. (“nms Vietnam”). This has led Zhongji Zhonghe tosteadily increase enrollment at its two branch offices (in Wuxi and Shenzhen), enabling a smooth launch of business.
Based on the foregoing, the Group reported revenues of 2,432 million yen (+21.1% on the year) with operating loss of 27
million yen (corresponding period in the previous year had operation income of 11 million yen).
[2] Customer Service (CS) operations
Note that since April 1, 2012, former “Manufacturing Solutions (MS) operations” has been renamed as “Customer Service (CS)
operations”.
CS operations, despite of its small business size, is a unique and highly profitable business model not present with othercompanies, creating a differentiator in the industry. Especially in the Group’s “neo EMS” business development, in-housefactories serve multiple purposes as bases for CS operations, bases for adjusting supply and demand of human resources,
educational facilities to improve add-on values of human resources, and mother factories to the client bases that are scattered assatellites. With such an important mission, though, there has been no major development of new business for the past few years,
and even the main repair business for home-use video game equipment and mobile phones has been unable to record significant
growth in today’s severe business environment. Nonetheless, with regard to field services business which provides visit repair
services, its launch has been smoothly underway since last period, and during period under review, a new organization for field
service business was added to an existing organization for contracting business, resulting in a system restructuring for promoting
CS operations.
Also in the period under review, continuing from the previous period, CS operations further strengthened the cooperation with
Zhongji Zhonghe who offers overseas human resource business, along with nms Vietnam, TKR Group who offers EMS
operations, and SHIMA Group. In order to seek business opportunity potentials overseas, a feasibility study which includes
marketing review as well as business model review has been under way.
Based on the foregoing, the Group reported revenues of 606 million yen (-11.5% on the year) with operating income of 15
million yen (-16.4% on the year).
[3] Global Engineering (GE) operations
In the period under review, continuing from the previous period, GE operations mainly focused on domestic engineer dispatch
services as a key operation. While experiencing a difficulty in securing Japanese engineers in the engineer dispatch market, nms
viewed it as a business opportunity; working more closely with Beijing Rihua Caichuang International Technical Services Ltd.
and Zhongji Zhonghe, two local affiliates in China, nms made further improvements to the Group’s unique business model ofdispatching Chinese engineers to Japanese manufacturers in China and met the needs of its clients.
In addition, GE operations has been practicing its business development as “neo EMS”, meaning that it has been focusing on thecreation of new contract-base design business by cooperating with TKR Group and SHIMA Group, which had been turned into
subsidiaries and offer EMS operations, while at the same time dispatching engineers from TKR Group and SHIMA Group to
meet the demand within the nms Group as production fluctuated.
As a result, the Group reported revenues of 156 million yen (+0.7 % on the year) with operating income of 3 million yen(+15.0 % on the year).
[4] Electronics Manufacturing Service (EMS) operations
EMS operations develops its business with SHIMA Electronic Industry Co., Ltd, which joined the Group in July 2010, and its
two subsidiaries, along with TKR Corporation, who entered into management integration with the Group also in July 2010, andits eight subsidiaries.
In the period under review, the goal of EMS operations was to display business synergy with the Group’s IS, CS and GE
operations and to more powerfully promote “neo EMS”. In particular, a cross-sectional sales strategy organization named EMS
sales group was set up in April 2012, in order to vigorously promote sales toward key accounts by head office. Following these-3 -Nippon Manufacturing Service Corporation. (2162) /Consolidated Financial Results for First Quarter of Fiscal Year Ending March 31, 2013
(Three Months Ended June 30, 2012) (Based on J-GAAP)

moves, the Group is beginning to steadily receive orders that extends to multiple operations, and EMS operations, which
originally did not own any management resources, is gathering momentum to play a certain role as a mother factory for “neoEMS” within the Group, along with in-house factories, bases of CS operations.
As a result, the Group reported revenues of 4,977 million yen (+99.3 % on the year) with operating income of 200 million yen(+1,527.0% on the year).
Note that SHIMA Electronic Industry Co., Ltd and SHIMA Electronic Industry (H.K) Co., Ltd. have changed account closing
date from March 31 to December 31, and their results for the first quarter are reported in the beginning balance of retained
earnings. Results for the two companies, therefore, are not included in the consolidated results of operations for the first quarter.
(2) Qualitative information concerning financial position
Consolidated assets at the end of the period under review increased 616 million yen compared with the end of the prior fiscal
year to 19,325 million yen.
Current assets increased 379 million yen compared with the end of the prior fiscal year to 13,416 million yen. This was due totrade notes and accounts receivable, which increased 367 million yen.
Fixed assets increased 236 million yen compared with the end of the prior fiscal year to 5,909 million yen. This was due tointangible assets, and investments and other assets, which increased 150 million yen and 111 million yen, respectively.
Consolidated liabilities increased 219 million yen compared with the end of the prior fiscal year to 13,089 million yen.
Current liabilities increased 480 million yen compared with the end of the prior fiscal year to 10,709 million yen. This was due
to accrued liabilities and short-term loans payable, which increased 98 million yen and 336 million yen, respectively.
Long-term liabilities decreased 261 million yen compared with the end of the prior fiscal year to 2,379 million yen. This wasdue to long-term loans, which decreased 230 million yen.
Consolidated net assets increased 396 million yen compared with the end of the prior fiscal year to 6,236 million yen. This wasdue to retained earnings, translation adjustments and minority shareholder's interest, which increased 66 million yen, 108 million
yen and 197 million yen, respectively.
(3) Qualitative information concerning business performance forecast
The earning estimates for the consolidated first half of fiscal year ending March 31, 2013 (six months ending September 30,2012) listed in “Consolidated Financial Statements for the Fiscal Year Ended March 31, 2012 (Based on J-GAAP)” released on
May 15, 2012, remain unchanged.
It should be noted that earnings estimates are based on the information available at the time of release and are subject to revisionin case earnings trends change due to events.

2. Summary (Other) Information(1) Changes in significant subsidiaries during the consolidated quarter (three months) under review
None.
Note that since the consolidated first quarter under review, SHIMA Electronic Industry Co., Ltd and SHIMA Electronic Industry(H.K) Co., Ltd. have changed account closing date from March 31 to December 31 in order to promote efficiency in operations.
Their results for the first quarter (January 1, 2012 to March 31, 2012) are reported in the beginning balance of retained earnings.
(2) Application of accounting procedures specific to creation of quarterly consolidated financial statements(Application of accounting procedures specific to creation of quarterly consolidated financial statements)
For some of its consolidated subsidiaries, the effective tax rate expected to be imposed on pretax net income (after tax effectaccounting) applicable to the tax year in which this first quarter is included was estimated based on reasonable assumptions.
Then, tax expenses for the first quarter were calculated by multiplying the pretax net income for the quarter by the estimatedeffective tax rate.
(3) Change of accounting policies; change and/or restatement of accounting estimates
Change of accounting policies(Change of depreciation method)
In accordance with the amendment of the Corporation Tax Law, effective from the consolidated first quarter of fiscal year
ending March 31, 2013, nms and its domestic consolidated subsidiaries have changed their depreciation method for those
property and equipment acquired on or after April 1, 2012.
The impact of this change on operating income, ordinary income and net income before income taxes and minority interests is
not significant compared to the former method.

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