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Wa l k
Advanced technologies create...
toget h e r A nnual R eport
2012
April 1, 2011–March 31, 2012
New materials make...
Toray Profile: Overview and Philosophy
We are involved in global manufacturing, marketing and sales in three business categories covering six seg-
ments: Foundation Businesses (Fibers & Textiles, Plastics & Chemicals), Strategically Expanding Businesses
(IT-related Products, Carbon Fiber Composite Materials) and Intensively Developing and Expanding Busi-
nesses (Environment & Engineering, Life Science).
Our products are found in many everyday items, including apparel, interior products, home appliances
and electronic products, as well as in materials and parts for automobiles and aircraft, IT products and water
treatment facilities.
Today, we are active in 23 countries and regions. To successfully conduct our day-to-day operations, we
rely on the strong chemistry that we have created with our stakeholders, including Toray Group employees,
our customers and business partners, the people of the countries and regions in which we are active, our
stockholders and people working for financial institutions.
“Contributing to society through the creation of new value with innovative ideas, technologies and
products”—this is Toray Group’s corporate philosophy. We will continue to put this philosophy into practice
by creating new value in the spirit of respect for all of our stakeholders.
Corporate Philosophy
Contributing to society through the creation of new value with innovative ideas, technologies and products
Corporate Missions
For our customers To provide new value to our customers through high-quality products and superior services
For our employees To provide our employees with opportunities for self development in a challenging environment
For our stockholders To provide our stockholders with dependable and trustworthy management
For society To establish ties and develop mutual trust as a responsible corporate citizen
Imagine it...
CAUTIONARY STATEMENT WITH RESPECT TO FORWARD-LOOKING STATEMENTS
Descriptions of predicted business results, projections and business plans contained in this annual report
are based on forecasts and assumptions regarding the future business environment made at the present
time. This annual report is not a guarantee of the Company’s future business performance.
02
c a n h elp to
t h a t T oray
e b e l ieve fo r pe ople
W
u a li ty of life
the q in the
improve re ating va lu e
ere b y c
everywh d m at e rials.
o f a dvance
form ,
cie ty . F o r example
so
r to transform ally
h a v e th ep o w e
r h a v e dramatic
Materials fibe
o f carbon a
h a n d ligh t n e s s
s e n g e r jets. As
g t y pa s
the stren n s umed b ree-
t h e e n erg y c o
w e e n joy the f
reduced n era in w
hich
ized
e n o w live in a
ie n t m edium-s
result, w effic
on highly sed
t r a v e l the w o r ld
e t ic fi b ers are u
dom to ynth
c e d f u n ctional s
ur advan
aircraft. O r m innerwea
r.
easy
c e li g h t ye t w a
ia ls is n ever an
to produ ate r
r e a t io n of new m e r ia ls t h a t
t h e c m a t
Howeve
r, ded
h - v a lu e - a d
t h e v a r io u s h ig
u lt s o f a relent-
of res
t a s k . A ll o r ld are the
r o u g h t to t h e w
g y d e v e lopment.
sb nolo
Toray ha and tech
m e n t to re se a rch
s t a r t e d to trans-
mit ve
less com e d b y Toray ha
evelo p
e w m a terials d
N ty.
a s p e c t s of socie
ny
form ma
03
Wa l k
ANNUAL REPORT 2012
toget h e r
Contents
Advanced technologies create...
05
05
New materials make...
05 Message 1.........Reducing weight
07 Message 2.........Functional apparel
09 Message 3.........Expanding “New energy”
11 Message 4.........New advances in medical care
13 Message 5.........Securing water resources
To Toray Stockholders and
16
Investors
23 Toray’s Global Operations
28 Toray Group Segments
30
31
32
33
Fibers & Textiles
Plastics & Chemicals
IT-related Products
Carbon Fiber Composite Materials
16
34 Environment & Engineering
35 Life Science
36 R&D and Intellectual Property
42 Sustainable Management
52 Corporate Information
42
55 Financial Section
91 Investor Information and Corporate Data
28
Message
1
Reducing weight
Weight reduction has always been a priority for design-
ers of all kinds of vehicles. Whether in automobiles,
aircraft or space rockets, less weight means lower fuel
consumption and greater range. Our continual quest
for lighter materials has led from iron to alloys of alu-
minum, titanium and other metals, and to plastics and
other substances.
The most promising solution to our need for lighter
materials is carbon fiber. With only one-quarter the
weight of steel, carbon fiber is 10 times stronger. This
combination of strength and lightness has resulted in
the use of carbon fiber in a growing range of aircraft
parts. Carbon fiber composite materials make up 50%
by weight of the fuselage of the Boeing 787 passenger
jet, which went into service in 2011 and has started to
cross the world’s skies.
05
Carbon fiber—a light, strong body material
Although carbon fiber is attracting renewed interest today, its industrial development be-
gan around 50 years ago. Since then, many companies have started to develop commer-
cial applications to capture the many advantages of carbon fiber, including its lightness
and strength and the fact it never rusts. However, most of these companies have since
abandoned carbon fiber because of the many years required to recover investments, and
because of the difficulty of producing high-quality fibers reliably.
Toray believes in the future potential of carbon fiber and has worked relentlessly to cre-
ate markets and develop technology. We anticipated the emergence of major new markets
n
based on carbon fiber applications in such fields as aerospace, sports and general industry.
We have since worked to harness the growth of these markets by building global opera-
io
tions based on production facilities in Japan, North America and France. With a market
t
share in excess of 30%, Toray is today the world’s top* manufacturer of carbon fiber.
c
*By sales volume, based on Toray estimates
TEEWAVE ® AR1—Concept Electric
Vehicle
Can carbon fiber composite materials revo-
lutionize the automobile? Toray responded
to this question by unveiling the electric
TEEWAVE® AR1 concept vehicle at the 2011
.. .in A
Tokyo Motor Show. The TEEWAVE ® AR1
was designed by Gordon Murray, former
chief designer for the McLaren Formula 1
team. By using carbon fiber composite ma-
terials, the body weight was reduced to just
846 kg. Toray materials were also used in
the battery, motor and other parts to cre-
ate a concept vehicle that would embody
Toray’s total capabilities.
y
of ke
e ight
by w e re-
p 50% l ag e. Th
ake
u fus e car-
r ia ls m n g s and c tio ns in
mat e
its w
i redu only
8 7 p osite u ding s and n o t the .
ing 7 co m in c l
avin
g are craft
Boe n fiber in g 787, . Fuel s w e ight th is air
o e t d n ae
s
y car
b Bo eigh redu
ce er i incre
Tora ts of the io n in w o m r bo n fib e to r
n t gf r f ca ssib l neve
pone duc
com m a tic re s re sultin ive use o b e e n po n fi ber a
is dr
a ion tens lso rbo d at
sult e e miss th e ex it has a t t h at ca a in taine o
diox
id from ger, fac em ble t
bon r e sult is s tron tio n , the in c an b s be en a
o di ab
fits t usela
ge
In ad the c eing
ha
bene the f ws. el in r, Bo ced.
c au se
e w in d o
id ity le v
o n fib e
er p rodu
e arb t ev
B of th the h
um ng c rcraf
size that y usi er ai
the ns e l. B e n g
mea lev ass
rusts table ble p
co mfor o m forta
mor
e ost c
06 ate the m
cr e
Message
2
Functional apparel
Natural fibers such as cotton, wool, silk and flax have
been used in apparel since ancient times. Each of these
materials has been used for different purposes, based
not only on fashion perspectives but also on specific
advantages, such as warmth, moisture resistance, the
capacity to absorb perspiration and ease of drying.
With the emergence of synthetic fibers, it became
possible to use chemistry to create fibers with the
same functions as these natural materials. The abil-
ity to supply synthetic fibers cheaply and reliably has
made a major contribution to the world of apparel.
Synthetic fibers have continued to evolve, and today
they offer increasingly diverse and sophisticated func-
tions to enhance wearer comfort.
There are thin, light synthetic textiles that not only
conserve heat produced by the wearer’s body, but also
generate heat when worn and have excellent perspira-
tion absorption characteristics. Products such as these
are changing our perceptions of apparel and transform-
ing our lifestyles.
07
HEATTECH—amazing apparel
that creates its own warmth
Many people became aware of the potential
of functional apparel when they first encoun-
tered HEATTECH. Developed jointly by Toray
and UNIQLO, it offers a range of functions that
include not only heat retention, perspiration
absorption and rapid drying, but also the ability
to create heat from the wearer’s perspiration.
HEATTECH first appeared in 2003. Initially,
it was made by combining acrylic fibers, which
have excellent heat retention properties, with
rayon, which can generate warmth from water
vapor. In the following year, polyester fiber
was added to provide perspiration absorption
and rapid drying characteristics. In 2007, poly-
urethane fiber was added to give the material
stretchability. In that year, consumers bought
20 million items made from HEATTECH, a
combination of four different fibers. The
product has continued to evolve, and sales
volumes have risen to 50 million in 2009 and
100 million in 2011.
In 2006, Toray and UNIQLO formed a stra-
tegic partnership, under which they have since
created a total industry, including planning,
development, production and distribution at
all stages from raw materials to finished prod-
ucts. Under a subsequent strategic partnership
agreement, signed in 2011, the two compa-
nies aim to achieve cumulative transactions
amounting to ¥400 billion by 2015.
Under this strategic partnership, Toray and
UNIQLO have created many hit products, in-
cluding not only HEATTECH, but also Silky Dry
and Ultra Light Down.
08 ...in Betterment
Message
3
Expanding “New energy”
Electric power is an essential source of energy for soci-
ety, industry and individuals. To ensure the reliable and
sustainable supply of electric power in the future, we
will need to make increased use of renewable energy,
including solar power, wind power and fuel cells, which
have high energy efficiency and qualify as low-emission
devices. This will require the development of revolution-
ary devices and materials that can be used to create a
new generation of practical and efficient power genera-
tion systems under the heading of “New energy.”
There is also renewed awareness of the importance
of storage batteries in ensuring the efficient use of
valuable electric power. Traditionally batteries were
used mainly to power electronic devices and other
small items, or in auxiliary roles, such as power for mo-
tor vehicle starter motors. In the future they will be the
prime sources of power for electric vehicles. Storage
batteries are also expected to be used increasingly to
stabilize the supply of electric power from sources that
are affected by weather conditions by storing power
when demand is low and supplying it at peak times.
09
...in Progress
Advanced materials the key to a new future for batteries
The core technologies for Toray’s research and development efforts in the field of advanced
materials are organic synthetic chemistry, polymer chemistry, biotechnology and nanotechnol-
ogy. Toray has identified a number of product categories as offering opportunities for the appli-
cation of its technology development capabilities in the next-generation energy technology. We
are focusing in particular on battery materials, solar cells, lithium-ion batteries and fuel cells.
By 2020, the solar cell market is expected to reach ¥12 trillion. Toray supplies a range
of advanced functional materials, including polyester film for use as back sheets. The grow-
ing popularity of hybrid and electric vehicles is expected to boost the market for lithium-ion
batteries to over ¥5 trillion by 2020. Toray Tonen Specialty Separator Godo Kaisha, which
manufactures and sells battery separator film, was made a wholly owned subsidiary, and
Toray Battery Separator Film Co., Ltd. was established. Toray is also developing fuel cell ma-
terials. By offering a wide range of materials, Toray aims to become the world’s leading
integrated manufacturer of battery materials.
10Message
4
New advances in medical care
New advances in medical technology not only help to
open up new fields and provide cures for previously in-
curable diseases, but also contribute to improvements
in the safety and quality of medicine, including the re-
duction of the burden on patients. For example, the evo-
lution of dialyzers for use in hemodialysis is providing
improvements in the effectiveness of this treatment.
One of the new surgical techniques that have helped
to reduce the impact on patients in recent years is
catheter surgery. New treatment methods result both
from advances in medical technology and also from the
development and improvement of new products.
Medical science will continue to move forward in
directions that help to reduce the burden on patients.
11blood
urifies
b rane p
- fi b e r mem process
,
ollow ring this
nced h e rs . D u r.
ialyz s wate
Adva H T ™ NV f th e blood th
rough d
s te m atter an
d exces
used
T O R AYLIG c ir c ulation
o
m oving w
a
e n we have
r — a l y re e th
Dialyze e extern blood b . Sin c enced
olves th rify the in 1977 e comm
o d ia lysis inv re u s ed to pu a n e d ialyzers re . In 2011, w the
He m
branes
a memb r
edical c
a hesion to
o w -f ib er mem h o ll o w-fiber v e m e nt of m li ty . P la telet ad a rl ier
holl sell impro ctiona with e
fi r s t began to n tr ib u te to the v e m e n ts in fun 1 0 0 c o mpared
Tora y to c o impro r of
nology h offers y a facto nt.
ue tech NV, whic duced b treatme
our uniq H T ™ e e n re h ut the
o This new
th e T O R A Y L IG
b ra n e s h a s b
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g d a o , China. .
sales o f iber m e m V to fu n City, Q in ountries
f th e hollow-f R A Y L IGHT™ N c to ry in Jimo n e m erging c
surface
o the T O lyzer fa rs in A s ia TORA - Y
d u c ts , allowing u c ti o n of a dia n d fo r dialyze a p a c it y for the
ro ons tr g dem a c
Toray p enced c xpandin producti
on
e comm e with e Group’s
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us to ke double
ill allow ich will
facility w n e w p lant, wh
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seri e y of pla te proteins
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Ap ify w ith in d a s b lo lm o n a ry b y blood
rl y a nd solid c o m e activate rc ti o ns or pu o m e clogged es
pro pe
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b e
brain in fa they b e c er 20-tim
b lo o d can ad th e y c a n cause ri s k . H owever, ft in p la ce for ov lo g y.
in th e lungs, vent this be le chno
r th e brain or u s e d to pre filt e rs that can m e r design te -
and e n te filters a re
y releas e d
ginal p o ly other pa
b o li c p rotection a rc h 2 0 12, Tora ll y u s in g its ori a n d w ill explore
Em . In M ccessfu filters
tively sh
ort time ed by su rotection
in a rela d u c ts , develop v e lo p e mbolic p v a scular fie
ld.
a n e a rlier pro c h n o lo gy to de a s o f th e cardio
longer th g to use
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To ing med
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...in S
12Message
5
Securing water resources
The Earth is sometimes described as a “water planet.”
However, 97.5% of the Earth’s water is seawater, and
freshwater resources make up only 2.5% of the total.
The amount of freshwater available for use by human
beings for daily life and industrial activities is even
smaller, at just 0.01% of the total. Freshwater is a pre-
cious resource, and yet the amount available continues
to shrink due to climate change and environmental
damage. At the same time, demand for water contin-
ues to expand because of world population growth and
economic development in emerging countries. Water
shortages have become a serious social problem in
many parts of the world. Efforts are now being made
to mitigate water shortages through water conserva-
tion, environmental preservation and other measures.
However, seawater desalination is increasingly seen as
a more effective solution in the many regions that are
naturally short of water resources. The key product in a
desalination plant is the reverse osmosis membrane.
13...in Conception
Reverse osmosis membranes—turning seawater into drinking water
Desalination plants traditionally used evaporation to turn seawater into drinking water. Today, however, sys-
tems based on water treatment membranes are being used increasingly because of advantages that include
lower energy consumption and costs. Toray developed reverse osmosis (RO) membranes that are ideal for de-
salination by improving related technologies, including nanotechnology-based polymer separation membrane
technology. As a result, Toray has gained a 30%*1 share of the world market.
In addition to RO membranes, there are three other types of membranes that differ according to their wa-
ter permeability and the substances that they can remove. Toray enjoys an important advantage because it de-
velops and manufactures all types of these membranes. Because it can offer the most suitable membranes for
any application, Toray has established a substantial track record, not only in the area of seawater desalination,
but also in other fields, such as wastewater reuse.
Toray has gained an excellent reputation for water treatment membrane technology. In recent years we
have achieved considerable success in the control of microscopic structures, as evidenced by our ability to
create holes with sub-nanometer precision. We have used this technology to produce RO membranes with
the world best boron-removal performance*2 and the capability to produce large amounts of drinking water.
Toray membranes have been used in major projects, including the largest desalination plants in Africa (Algeria)
and Asia (Singapore). They are also being used increasingly in the rapidly expanding Chinese market. RO mem-
branes already shipped by Toray produce sufficient drinking water for 98 million people around the world.
*1 Estimated by Toray on the basis of shipment volumes
*2 Boron levels in drinking water are regulated because of its harmful effects when ingested, including toxic effects on the repro-
ductive system.
1415
Design it... 16
To Toray Stockholders and Investors
Akihiro Nikkaku
President
17To Toray Stockholders and Investors
I would like to begin this report by expressing our sincere appre- Project AP-G 2013 not only pursues an energetic growth
ciation for the ongoing support and understanding of our stock- strategy based on expansion in growing business fields and re-
holders and investors. We are committed to grow sustainably gions, but also strengthens our overall cost competitiveness.
based on the realization of our corporate philosophy of contrib- The goal is a business structure capable of supporting sus-
uting to society through the creation of new value with innova- tainable growth. Within that structure, the Fibers & Textiles and
tive ideas, technologies and products. This report contains our Plastics & Chemicals segments are positioned as “Foundation
consolidated financial results for fiscal 2011 (ended March 31, Businesses,” driving steady business expansion with increases in
2012), together with strategies outlining Toray Group’s priorities revenues and profits. The IT-related Products and Carbon Fiber
and future direction. Composite Materials segments are positioned as “Strategically
Expanding Businesses,” to drive revenues and profit growth over
the medium and long term. And, the Environment & Engineering
Launch of the medium-term management
and Life Science segments are positioned as “Intensively Devel-
program—Project AP-G 2013
oping and Expanding Businesses,” the next drivers of revenue
Fiscal 2011 was affected by negative events, not least of which
and profit growth.
was the Great East Japan Earthquake, but also including mas-
In fiscal 2011, trends in the IT-related Products segment
sive floods in Thailand, the historically high yen appreciation
were affected by production cutbacks in the flat-panel display
and credit uncertainty in Europe. Toray Group was successful in
industry resulting from a downturn in the flat-panel television
minimizing the impact of these situations with the cooperation
market. However, our financial performance was steady, thanks
of our business partners and the hard work of our employees. In
to generally strong sales of products for apparel and industrial
April 2011, Toray Group initiated a new three-year medium-term
applications in the Fibers & Textiles segment, and efforts to in-
management program, Project AP-G 2013, under which we will
crease sales of products for aircraft, environment and energy-
build on our achievements in previous medium-term manage-
related applications, especially in the Carbon Fiber Composite
ment programs. Toray Group is moving to a new growth track
Materials segment.
by adopting more proactive management while maintaining our
Net sales increased by 3.2% year on year to ¥1,588.6 billion,
commitment to relentless reform.
operating income by 7.6% to ¥107.7 billion and net income by
10.9% to ¥64.2 billion. We set new records for both operating
Record income despite challenging business income and net income.
conditions The operating income ratio for the year under review was
Despite continuing uncertainty in the business environment, we 6.8%, 0.3 points over the previous year’s figure. ROA reached
have no intention of changing the direction of our growth strategy. 6.8% and ROE was 10.5%.
“ Toray Group achieved record earnings in fiscal 2011,
despite the negative impact of economic crises,
”
natural disasters and other events.
18Consolidated Financial Highlights
Toray Industries, Inc. and Consolidated Subsidiaries
Years ended March 31
Thousands of
Millions of yen U.S. dollars
2012 2011 2010 2009 2008 2012
For the year:
Net sales ¥1,588,604 ¥1,539,693 ¥1,359,631 ¥1,471,561 ¥1,649,670 $19,373,220
Operating income 107,721 100,087 40,107 36,006 103,429 1,313,671
Net (loss) income 64,218 57,925 (14,158) (16,326) 48,069 783,146
Cash flows from operating activities 104,410 129,214 166,215 38,447 110,367 1,273,294
Cash flows used in investing activities (104,002) (50,734) (121,723) (113,373) (164,151) (1,268,317)
Free cash flows 408 78,480 44,492 (74,926) (53,784) 4,976
At year-end:
Total assets ¥ 1,581,501 ¥1,567,470 ¥1,556,796 ¥1,523,603 ¥1,698,226 $19,286,598
Net assets 674,149 640,970 518,216 512,610 642,159 8,221,330
Per share of common stock (in yen and U.S. dollars):
Net (loss) income:
Basic ¥ 39.41 ¥ 36.41 ¥ (10.12) ¥ (11.66) ¥ 34.34 $ 0.48
Diluted 37.46 34.43 — — — 0.46
Cash dividends 10.00 7.50 5.00 7.50 10.00 0.12
Net assets 384.90 363.90 336.65 335.04 423.78 4.69
Ratios:
Operating income to net sales 6.8% 6.5% 2.9% 2.4% 6.3%
Equity ratio 39.7% 37.8% 30.3% 30.8% 34.9%
ROA 6.8% 6.4% 2.6% 2.2% 6.1%
ROE 10.5% 10.9% (3.0)% (3.1)% 8.1%
Debt/equity ratio (times) 0.77 0.83 1.34 1.42 1.00
Note: U.S. dollar amounts have been converted from yen at the exchange rate of ¥82 = US$1, the approximate exchange rate prevailing on March 31, 2012.
Net Sales Operating Income and Net (Loss) Income Cash Flows
Operating Income to Net Sales
(Billions of yen) (Billions of yen) (%) (Billions of yen) (Billions of yen)
2,000 140 7 70 200
60 150
120 6
50
1,500 100
100 5
40
50
80 4 30
1,000 0
60 3 20
-50
10
40 2
500 -100
0
20 1 -150
-10
0 0 0 -20 -200
Mar/ ‘08 ‘09 ‘10 ‘11 ‘12 ‘13 Mar/ ‘08 ‘09 ‘10 ‘11 ‘12 ‘13 Mar/ ‘08 ‘09 ‘10 ‘11 ‘12 ‘13 Mar/ ‘08 ‘09 ‘10 ‘11 ‘12
(Forecast) (Forecast) (Forecast)
n Operating income (left) n Cash flows from operating activities
l Operating income to net sales (right) n Cash flows used in investing activities
l Free cash flows
Note: Forecast for year ended March 31, 2013, announced on August 6, 2012.
19To Toray Stockholders and Investors
Total assets as of March 31, 2012 were ¥1,581.5 billion, source and energy problems, and contribute to the creation of a
similar to the position at the end of the previous fiscal year. The sustainable, low-carbon society. Toray is already the world’s No.
stockholders’ equity ratio rose by 1.9 points to 39.7%. We in- 1 manufacturer of carbon fiber composite materials, and we are
creased the annual dividend by ¥2.5 to ¥10 per share. also expanding our water treatment membrane business with
the aim of consolidating our leadership in that area as well. In
addition, we are determined to establish Toray as No. 1 in the
Pleasing progress under Project AP-G 2013
world in other priority areas, such as battery materials and bio-
The key principles of Project AP-G 2013 are to expand business-
mass materials.
es in growth business fields and growth regions, and to estab-
Sales from Green Innovation Businesses amounted to ¥428.2
lish a robust business footing by cost reductions. Activities that
billion in fiscal 2011. We are now progressing steadily toward
would yield major benefits on a group basis will be implement-
our goal of ¥500 billion in fiscal 2013 (ending March 2014). We
ed as group-wide projects. These are Green Innovation Business
aim to increase sales to ¥1,000 billion in the period up to 2020.
Expansion, Asia and Emerging Country Business Expansion and
Achievements in priority fields in fiscal 2011 are outlined below.
Total Cost Reduction.
We plan to invest a cumulative total of ¥350 billion in plant • Carbon fiber composite materials: We decided to increase carbon
and facilities over a three-year period that began in fiscal 2011. fiber production capacity in four key locations—Japan, the United
Two-thirds of that amount will be targeted toward investment States, France and the Republic of Korea.
in growth, with Green Innovation Businesses receiving a 60% • Water treatment membranes: We won an order to supply reverse
share. We also plan to allocate 50% of our investment to Asia. osmosis (RO) membranes in Singapore for Asia’s biggest seawater
We will invest a cumulative total of ¥160 billion in research and desalination plant.
development during the three-year period, with 50% of that • Battery materials: Toray Tonen Specialty Separator Godo Kaisha,
amount devoted to R&D relating to Green Innovation. originally a joint venture company, became a wholly owned subsid-
iary. Toray Battery Separator Film Co., Ltd. was established.
Green Innovation Business Expansion Project • Biomass materials: We succeeded in creating a prototype for the
Toray Group believes that the Green Innovation Business Ex- world’s first polyester fiber derived entirely from biomass materials
pansion (GR) Project will increasingly support its efforts to find and signed a joint research agreement with Ajinomoto Co., Inc. for
solutions for problems in the global environment, including re- bio-based nylon.
Net Assets and Equity Ratio Cash Dividend Per Share “Project AP-G 2013” Financial Targets
(Billions of yen) (%) (Yen)
800 40 10 Fiscal 2010 (Actual)
Net sales 1,539.7
8 Foundation businesses 966.4 (63%)
600 30
Strategically expanding businesses and
573.3 (37%)
Intensively developing and expanding businesses
6
Growth countries and regions 540.3 (35%)
400 20
Green innovation businesses 378.0 (25%)
4
Operating income 100.1
200 10 Operating income to net sales ratio 6.5%
2
ROA 6.4%
ROE 10.9%
0 0 0
Mar/ ‘08 ‘09 ‘10 ‘11 ‘12 Mar/ ‘08 ‘09 ‘10 ‘11 ‘12 ‘13 Remarks (Fiscal 2013)
(Forecast)
Estimated exchange rate 80 yen / US$ ROA=Operating income / Total assets
n Net assets (left)
l Equity ratio (right) Estimated oil price 95 US$ / B(DUBAI FOB) ROE=Net income / Stockholders’ equity
20Asia and Emerging Country Business Expansion Project build a high-level production system domestically. We believe
Under the Asia and Emerging Country Business Expansion (AE) that the key to drive this project is strong links between our
Project, we are working actively to expand our businesses in domestic production sites and production sites overseas. This
Asia and emerging countries of other regions that promise sub- will further business expansion and strengthen our cost com-
stantial economic growth in the future. petitiveness as a group.
In fiscal 2011, sales from growth countries and regions were
¥560.1 billion, equivalent to 35% of total net sales. The goal Total Cost Reduction Project
is ¥720 billion, or 40% of total net sales in fiscal 2013 (ending Since the Lehman shock, Toray Group has targeted cost reduc-
March 2014) and a contribution to total net sales of 50% by tions in all areas of activity without exception. These efforts
around 2020. Achievements in fiscal 2011 are outlined below. have reduced fixed costs and variable costs by a total of over
¥100.0 billion.
• China: The establishment of a production facility for dialysis ma-
We believe sustainable growth and development requires not
chines was followed by a decision to build a new production facility
only the implementation of growth strategies, such as the GR
for dialyzers. We also strengthened our research and development
Project and the AE Project, but also the maintenance of a robust
facilities in Shanghai for segments other than Fibers & Textiles.
business footing. As part of AP-G 2013, we are also implement-
• The Republic of Korea: We decided to expand our production ca-
ing the Total Cost Reduction (TC-II) Project, the aim of which is
pacity for lithium-ion battery separators. Work also continued on the
to strengthen our total cost competitiveness. The entire Toray
construction of a new carbon fiber plant.
Group is involved in this initiative, which we see as vital to our
• Indonesia: We decided to commence a high-performance polypropyl-
achievement of sustainable growth in the future.
ene spunbond business for infant disposable diapers and commenced
construction of a production facility.
• Other emerging countries: We established an office in India and
also decided to establish an operational base in Brazil.
Besides the above, Toray Group is continuing to develop
advanced materials and maintain its strength in production of
high-value added products in Japan. To expand overseas busi-
ness, it is important to promote technology development and
(Billions of yen)
Fiscal 2011 (Actual) Fiscal 2013 (Targets)
1,588.6 1,800.0
1,036.2 (65%) 1,000.0 (56%)
552.4 (35%) 800.0 (44%)
560.1 (35%) 720.0 (40%)
428.2 (27%) 500.0 (28%)
107.7 150.0
6.8% 8.3%
6.8% 8%
10.5% 11%
( ) Net sales ratio
21To Toray Stockholders and Investors
One of our goals under AP-G 2013 is to reduce variable launching the AP-G 2013 program.
costs by more than 3% per year, a total saving of 10%, or ap- We believe that the most important priority for Toray Group,
proximately ¥70 billion, over the three-year period. In fiscal as a manufacturer of raw materials, is the accumulation of tech-
2011, we achieved a year-on-year reduction of 3.6%, or ¥24.1 nology. The reverse osmosis (RO) membranes manufactured by
billion. Controlling fixed costs during a business expansion Toray Group today are the result of efforts spanning more than
phase requires appropriate scale management. Our goal is to four decades. The expansion of our carbon fiber business is the
keep the rate of increase in fixed costs within the rate of in- result of 50 years of research. The development of revolutionary
crease in marginal profit. In fiscal 2011, we reduced fixed costs new materials is not something that can be achieved overnight.
by ¥14.3 billion compared with the budgeted level. Toray Group is determined to maintain its position as one of
the world’s leading raw material manufacturers by basing its
management on perspectives that extend 10 or 20 years into
AP-Growth Toray 2020—Management based
the future.
on long-term perspectives
Fiscal 2011 brought a variety of environmental changes that had
significant implications for the management of our business ac- Enriching society through the creation of
tivities. However, an analysis of the long-term future outlook in- innovative materials
dicates that world population will continue to increase, and that Toray Group aims to provide high value to all of its stakeholders
there will be continued growth in emerging countries in Asia and through the sustainable expansion of its earnings, while also
other regions. We are also certain that there will be an increasing working actively to contribute to social progress and prosperity
need for action to deal with global environmental problems and and environmental preservation and harmony.
meet needs in other key areas, such as food, water and energy. The world is seeking fundamental changes and innovation
In February 2011, we formulated AP-Growth Toray 2020, in our approaches to environmental problems and problems
our long-term corporate vision for the next 10 years. We aim relating to resources and energy. As one of the world’s leading
to achieve net sales of ¥3,000 billion and operating income raw material manufacturers, Toray Group is determined to con-
of ¥300 billion by around 2020 through global growth based tribute to the creation of an enriched society and improvement
driven by innovation in the field of advanced materials and in the quality of life through the continuing development of
Green Innovation Businesses. In fiscal 2011, we took the new technology and materials. We look forward to the continu-
first step toward the realization of this long-term vision by ing support of our stockholders and investors.
July 2012
President
Image of Financial Indicators
(Billions of yen)
Around 2015 Around 2020
(Vision) (Vision)
Net sales 2,000 3,000
Growth countries and regions 900 (45%) 1,500 (50%)
Green innovation businesses 600 (30%) 1,000 (33%)
Operating income 180 300
( ) Net sales ratio
22Toray’s Global Operations
Share it...
23With strategic presence
and advanced technology,
growing with communities
Toray Group’s global production began to expand in 1963
with the commencement of fiber and textile production
in Thailand. In a half-century, our overseas activities have
evolved into a network spanning 23 countries and regions.
Today, our overseas production ratios are 59% for fibers
and textiles and 77% for films. In total, overseas business
activities account for 45% of Toray Group net sales.
22,948 overseas
employees
Toray Group has 40,227 employees, of whom 22,948, or 57%, work overseas. Skilled people recruited
in various countries and regions make an important contribution to Toray’s business activities.
2450 years of global involvement and evolution
Toray Group has expanded overseas in three phases. In 1956, we invested
in a Hong Kong trading company, and in 1963 commenced fiber and textile
production in Thailand. Our main goal was to capture demand for fibers and
textiles in developing countries, and to establish bases for exporting to Europe
and North America. The next phase, in the 1980s set up additional businesses
overseas, especially in Europe and North America, through acquisitions and
45％
other methods. We shifted to local production of products including carbon
fibers in France and film products in the United States and France.
Then, in the 1990s, we began a significant expansion into China. We es-
tablished integrated production facilities in Nantong for the polymerization,
spinning, weaving and dyeing of polyester fibers. In the Republic of Korea,
we acquired the fiber and film operations of the Saehan Group and added
electronic materials and other products to their line-up. Gradually, we moved
into production of water treatment membranes and medical equipment in
China and will move into carbon fibers in the Republic of Korea. We are also
considering production operations in India and Brazil. Toray Group’s global 14%
expansion has now entered a new phase, in which powerful economic n Japan
growth in Asian countries and emerging economies is a major component of
the Group’s expansion.
n China
n Other Asia 18% 55%
n Europe,
North America,
Broad management resources bring key advantages etc.
We have the ability to supply products of high quality made to Toray stan- 13%
dards from any plant, all over the world. This network also brings flexibility
to cope with currency fluctuations, supply-demand trends and effects from
natural disasters. Products are manufactured in the most competitive loca- Regional Contributions to
tions and moved between locations to ensure that no sales opportunity is Net Sales in Fiscal 2011
missed. By minimizing the impact of economic flux, Toray Group maximizes In fiscal 2011, overseas sales were
the unique advantages it has gained through global business expansion. ¥712.4 billion, or 45% of total sales.
As a manufacturer in the raw materials industry, Toray Group accumulates its We use all of the Group’s resources
expertise and technology in its plants. For this reason, our basic policy on global and capabilities, such as extensive
expansion is that once established, a plant should operate over the medium- to management resources and our
long-term, working together with its local community to achieve mutual growth overseas infrastructure, to drive the
and success. Over 50 years, Toray Group has built a network of plants, facilities expansion of our overseas business.
and human talent around the world, together with invisible resources in the
form of management know-how specific to each region. These assets give us
important advantages in future business expansion. Broad expertise backed by
experience is also the key to rapid production start up at overseas locations with
different legal systems and cultural environments.
Our current focus is the expansion of business activities in Asia and
emerging economies. The efficient use of management resources will drive
this process and enable rapid progress.
Expanding global production in every business segment
Toray Group is globalizing production at optimal sites for each product. Today,
we are active in 23 countries and regions. We have established manufacturing
sites for staple fibers, filament yarns, and spun yarn, woven fabrics, dyed prod-
ucts and garments, especially in China and ASEAN countries. We also manu-
facture fibers and textiles for airbags in Thailand, the Czech Republic and
China. Other examples of growing global activities include the manufacture
of suede-texture artificial leather for use in car interiors in Italy and polypro-
pylene spunbond for disposable diapers in the Republic of Korea and China.
In the area of plastics and chemicals, we manufacture plastic resins and
films at overseas sites, especially in China, the Republic of Korea, ASEAN
countries and other Asian locations. In addition, we have established plants
25for PET film and other products in France and the United States as part of our
global supply network.
We anticipate demand growth for carbon fiber, and in addition to our
existing plants in Japan, the United States and France, we also plan to com-
mence production at a new facility in the Republic of Korea in January 2013.
By creating this production structure based in four countries, we aim to
achieve further expansion in this business area.
Toray is also expanding overseas in the environment and engineering seg-
ment. In addition to our existing production site for water treatment membranes
in the United States, we commenced production at a facility in China in 2011.
Major global expansion initiatives in fiscal 2011
Trends in Net Sales in Growth Countries and Regions Rapid economic growth in the ASEAN region has been paralleled by dramatic
growth in sales of disposable diapers. Determined to capture this demand, in
(Billions of yen)
3,000 3,000.0 2011 Toray established P.T. Toray Polytech Jakarta (TPJ) in Indonesia to manu-
facture high-performance polypropylene non-woven fabric (PP spunbond), for
disposable diapers. TPJ aims to start annual production of around 20,000 tons
in June 2013, boosting our total PP spunbond supply capacity, with our existing
2,000.0
facilities in China and the Republic of Korea, to around 121,000 tons per year.
2,000
1,800.0 We are also expanding carbon fiber production in Japan, the United
1,539.7 1,588.6 States, France and the Republic of Korea. The annual capacity of Toray Group
1,500.0 is currently 17,900 tons. By March 2015, we will expand our total capacity,
1,075.4 including facilities now being built in Japan and the Republic of Korea, to
1,000
27,100 tons. This will enhance our ability to supply high-quality, high-grade
900.0
carbon fiber reliably to customers worldwide.
720.0
540.3 560.1 Improvements to healthcare systems and other changes are raising de-
mand for dialysis machines and dialyzers in China. In June 2011, Toray and
251.5
0
Qingdao Jifa Group Co., Ltd. established Toray Medical (Qingdao) Co., Ltd.
FY FY FY FY Around Around (TMQ), which plans to start manufacturing dialysis machines in the first half
‘00 ‘10 ‘11 ‘13 ‘15 ‘20
(Actual) (Actual) (Actual) (Target) (Vision) (Vision) of 2012 and dialyzers in the second half of 2014.
■■ Total net sales ■ Growth countries and regions
(Asia and other regions)
Sales from growth markets—rising to 40% by fiscal 2013
Toray Group has switched to a more aggressive management stance under its
medium-term management program, Project AP-G 2013. In line with our basic
strategy under this program, we are making cross-organizational efforts to de-
velop our business activities in countries and regions with high growth poten-
tial through the Asia and Emerging Country Business Expansion (AE) Project.
The following four priority measures have been adopted for this project.
●W
e will develop and supply products and materials for specific
needs of Asian markets and emerging countries, building up our
marketing to ensure market penetration.
● We will reinforce production infrastructure at existing sites and new
sites. We will also enhance regional technical service.
●W
e will make optimal use of existing management resources, includ-
ing production and sales facilities. We will also use various methods,
including alliances with leading local companies, to expand our
business activities over a short timeframe.
● We will dynamically expand business activities, especially in the area
of advanced materials, to meet strengthening demand from growing
wealthy and middle-class populations.
Toray Group aims to increase sales from growth business fields and re-
gions, including emerging countries in Asia and other regions, from approxi-
mately ¥560 billion, or 35% of total net sales, in the fiscal 2011 to ¥720 billion,
equivalent to 40% of total net sales, in fiscal 2013.
26Built-in Immunity
to Exchange Rates
Toray Group worldwide group-level business structure strategically minimizes
exposure to the effects of exchange rate fluctuations.
Toray’s products anywhere in the world are backed by Toray technology and Toray quality.
During Thailand’s flooding in October 2011, we continued to supply customers by sourcing
products from other Toray Group plants.
Made in TORAY
27Toray Group Segments
Business Categories Segments
Foundation Businesses Fibers & Textiles
Net Sales
Ratio
65.3%
Plastics & Chemicals
Operating
Income Ratio 57.2%
Strategically Expanding IT-related Products
Businesses
Realize it...
Net Sales
Ratio
19.7%
Carbon Fiber Composite Materials
Operating
Income Ratio 33.2%
Intensively Developing and Environment & Engineering
Expanding Businesses
Net Sales
Ratio
14.2%
Life Science
Operating
Income Ratio 8.5%
Note: Excludes other businesses, equivalent to ¥13.3 billion (0.8%) in net sales and ¥1.3 billion
28 (1.1%) in operating income, and adjustment of operating income of –¥19.4 billion.Main Products Application Examples
Filament yarns, staple fibers, and woven and knit- • Women’s and men’s clothes (coats: man-made suede, dress shirts: polyester-cotton blended fabric, stock-
ted fabrics of nylon, polyester and acrylic fibers, ings: nylon fiber, apparel products, swimwear)
etc.; non-woven fabrics, man-made suede and • Automobiles (car seats: polyester fiber, airbags: nylon fiber, seatbelts: polyester fiber)
apparel products • Sportswear
• Furniture & interior (sofas: man-made suede, carpets: BCF nylon, curtains: halogen-free, flame retardant materials)
• Disposable diapers: polypropylene filament yarn non-woven fabric
• Tents: polyester fiber
Nylon, ABS, PBT, PPS and other resins and molded • Automobiles (radiator tanks: nylon resin, intake manifold: nylon resin, connectors: PBT resin, capacitor
products, polyolefin foam; polyester, polypropylene, for hybrid cars: polypropylene film)
PPS and other films and processed film products; raw • Home appliances (housing for washing machines, vacuum cleaners, air conditioners: ABS resin)
materials for synthetic fibers and other plastics; zeo- • Power tools (circular tools housing: nylon resin)
lite catalysts; fine chemicals for pharmaceuticals and • Helmets (nylon resin)
agrochemicals; veterinary medicine (excludes film • Solar battery panels (PET film) • Veterinary medicine (for dogs and cats)
and resin covered in IT-related Products segment) • Potato chip bags (polypropylene film) • Flat panel display televisions (PET film, PDP)
Films and plastic products for information and • Flat panel display televisions (PET film, PDP rear panel pastes, LCD color filter manufacturing equipment)
telecommunications related products; materials • PCs (circuit materials, PET film, polyimide coatings)
for electronic circuits and semiconductors; color • Cellular phones (color filters, LCP resin, circuit materials, PET film)
filters for LCDs and related materials and equip- • Printing (waterless printing plates, relief printing on resins, printing equipment)
ment; materials for plasma display panels; magnetic • Digital video camera recording film (PET film)
recording materials; graphic materials and related • In-vehicle multimedia LANs (optical fiber)
equipment • Semiconductors (semiconductor coating materials)
Carbon fibers, carbon fiber composite materials and • Aircraft structure (carbon fiber composite materials)
their molded products • Bridge pier reinforcement (carbon fiber woven fabrics)
• PC chassis (carbon fiber molded products)
• Wind-power generator blades (carbon fibers)
• Marine vessels (carbon fibers)
• Industrial equipment materials (carbon fiber, carbon fiber composite materials)
Comprehensive engineering; condominiums; in- • Seawater desalination facilities (water treatment membranes and equipment)
dustrial equipment and machinery; environment- • Sewage and waste-water treatment facilities (water treatment membranes and equipment)
related equipment; water treatment membranes • Condominiums
and related equipment; materials for housing, • Housing (wall siding for houses, interior materials for buildings)
building and civil engineering • Plants and manufacturing facilities (comprehensive engineering services)
Pharmaceuticals and medical products; analysis, • Pharmaceuticals (natural interferon-beta preparation, prostacyclin, antipruritus drug)
physical evaluation and research services • Medical treatment devices (hemodialyzers, artificial dialyzer and equipment)
• Physical analytical services
29Toray Group Segments
Foundation Business
Fibers & Textiles
(Billions of yen)
Fiscal 2010 2011 Changes 2012 Forecast
Net sales 584.1 638.4 +9.3% 680.0
Operating income 32.4 45.3 +39.7% 49.0
Fiscal 2012 forecasts announced on Aug. 6, 2012.
ROA: 10.9% 584.1
638.4
45.3
Operating income to net sales: 7.1%
32.4
Capital expenditures: ¥21.3 billion
■ Net sales ■ Operating income FY FY FY FY
2010 2011 2010 2011
TOPICS
Summary of consolidated financial results for fiscal 2011 Expanding Green Innovation
(Ended March 31, 2012) Businesses in the field of
Domestic sales of products for apparel applications benefited from strong demand
Fibers & Textiles
for materials used in functional innerwear. In the area of industrial applications, sales
of materials for automotive applications rallied in the second half in response to the One of the priority themes identified in our cur-
post-earthquake recovery of automobile manufacturers’ production operations. rent medium-term management program, AP-G
Overseas, the floods in Thailand affected both production and sales. How- 2013, is the expansion of our Green Innovation
ever, trends in sales of products for both apparel and industrial applications Businesses. In June 2011 we took an important
were generally firm, thanks to efforts to expand sales and shift to high value- step toward the expansion of Green Innovation
added products in a number of areas. They included polyester filament yarn, Businesses in the Fibers & Textiles segment by
staple fibers and textiles for apparel applications in China and ASEAN countries, establishing the Fibers & Textiles Green Innova-
polypropylene (PP) spunbond for disposable diapers in the Republic of Korea tion Business Planning Department to formu-
and China, textiles for airbag applications in Thailand and the Czech Republic late growth strategies and business plans, facili-
and suede-texture artificial leather in Italy. tate commercialization and provide support for
Net sales for the Fibers & Textiles segment in fiscal 2011 increased by 9.3% the Green Innovation Businesses that we are
year on year to ¥638.4 billion. Operating income was 39.7% higher at ¥45.3 billion. currently developing in each business division.
Toray is working to expand business that
Outlook for fiscal 2012 contributes to energy conservation, such as
materials designed for warmth or coolness, and
Within Japan, we expect demand for materials used in industrial applications to
biomass-derived fibers. We have also acceler-
remain generally strong, reflecting the recovery of automobile production and
ated the development and commercialization
demand from reconstruction in the wake of the Great East Japan Earthquake.
of new products. Green Innovation Businesses
However, overall market conditions for apparel applications are likely to be in-
in the Fibers & Textiles segment contributed net
creasingly challenging because of weak consumer spending, the persistent yen
sales of ¥67.9 billion in fiscal 2010 and ¥82.5
appreciation, and major fluctuations in raw material and fuel prices.
billion in fiscal 2011. Our target for fiscal 2013
Overseas, demand can be expected to remain on an expansionary trend in
(the year ending March 2014), the final year of
emerging countries. In addition to the stagnation of European markets, howev-
AP-G 2013, is ¥93.0 billion.
er, there is also concern that customers will delay purchasing decisions because
of sharp fluctuations in raw material and fuel prices, and we therefore expect
business conditions to remain generally difficult.
In this business environment, we will implement measures to secure ex-
pected income from the Fibers & Textiles segment as a Foundation Business and
to expand business globally. We will work dynamically to capture demand in
China and other growth regions, also in growth business fields, such as automo-
tive applications, disposable diapers and environment-related fields. We will also
aim to strengthen and expand our garment business, which is structured around
a planning and proposal model based on the development of new materials.
30Foundation Business
Plastics & Chemicals
(Billions of yen)
Fiscal 2010 2011 Changes 2012 Forecast
Net sales 382.3 397.8 +4.1% 430.0
Operating income 27.1 27.4 +1.0% 27.0
Fiscal 2012 forecasts announced on Aug. 6, 2012.
ROA: 6.6% 382.3 397.8
Operating income to net sales: 6.9% 27.1 27.4
Capital expenditures: ¥23.1 billion
■ Net sales ■ Operating income FY FY FY FY
2010 2011 2010 2011
TOPICS
Summary of consolidated financial results for fiscal 2011 Expansion of domestic
(Ended March 31, 2012) Production capacity for PPS
Trends in the domestic market were affected by the Great East Japan Earth-
resin Torelina®
quake, which caused a volume decline in sales of plastic resins for automotive
applications. However, a recovery emerged from the second quarter. In overseas Toray has decided to increase its production
markets, the global economic slowdown was reflected in sluggish demand, es- capacity for the polyphenylene sulfide (PPS)
pecially for general-purpose ABS resins. resin Torelina ®. Capacity for an additional
In the films business, domestic demand for both industrial and packaging 5,000 tons per year will be added at the
applications remained generally firm during the first two quarters. Overseas, Tokai Plant in Japan. When the new facilities
sales were higher in the United States, Europe and Asia. However, domestic and become operational in January 2013, total
overseas demand waned, intensifying price competition from the third quarter PPS resin production capacity will increase to
onwards under the impact of a global economic slowdown. 19,000 tons per annum.
Net sales for the Plastics & Chemicals segment, a Foundation Business, PPS resin is a super engineering plastic
amounted to ¥397.8 billion, a year-on-year increase of 4.1%. Operating income with a range of excellent characteristics, in-
increased by 1.0% to ¥27.4 billion. cluding resistance to heat and chemicals, me-
chanical strength and fire resistance. It is used
Outlook for fiscal 2012 in an expanding assortment of products, such
as automotive electrical components, electri-
Raw material and fuel prices are expected to fluctuate wildly, and the shift
cal and electronic devices, office automation
to overseas production by domestic customers of our products will continue.
equipment and housing parts. World demand
However, we anticipate that market conditions will improve thanks to the post-
for PPS resin compounds is estimated at
earthquake recovery of automotive production, combined with demand growth
around 80,000 tons per year and is expected
in China, the ASEAN region and emerging countries.
to grow by 8% per annum.
In this business environment, in the plastic resins business, we anticipate in-
Toray’s comprehensive involvement in PPS
creased sales of products for automotive applications and further growth in sales
manufacturing encompasses not only PPS
in China, the ASEAN region and emerging countries. We aim to maintain and
resin compounds, but also films and fibers. In
expand the spreads between selling prices and fuel and raw material prices by
terms of business scale, we are number one in
quickly passing on increased fuel and raw material costs quickly to selling prices.
the world. We will continue to consider further
In the films business, there is strong pressure from customers to reduce prices.
increases in production capacity to keep pace
We are determined to expand sales of high value-added products for industrial
with expanding demand for PPS resins.
and packaging applications.
31Toray Group Segments
Strategically Expanding Business
IT-related Products
(Billions of yen)
Fiscal 2010 2011 Changes 2012 Forecast
Net sales 262.0 243.4 -7.1% 270.0
Operating income 42.2 34.5 -18.3% 31.0
Fiscal 2012 forecasts announced on Aug. 6, 2012.
ROA: 10.4% 262.0 243.4
Operating income to net sales: 14.2% 42.2
34.5
Capital expenditures: ¥27.2 billion
■ Net sales ■ Operating income FY FY FY FY
2010 2011 2010 2011
TOPICS
Summary of consolidated financial results for fiscal 2011 New production facility for
(Ended March 31, 2012) surface protection film
Demand for materials for use in small and medium-size flat panel displays
established in Taiwan
(FPDs) for smartphones and other devices remained firm throughout the pe-
riod under review. However, a slump in the market for flat-screen televisions In May 2011, Toray Advanced Film Co., Ltd.
resulted in panel production cutbacks. This was reflected in slower demand for decided to establish Toray Advanced Film Ka-
products used in LCD and plasma televisions, including films and processed ohsiung Co., Ltd. in Kaohsiung City, Taiwan, and
film products. to build a new production facility for Toretec®
Net sales for the IT-related Products segment in fiscal 2011 were 7.1% low- self-adhesive surface protection film. Produc-
er year on year at ¥243.4 billion, while operating income declined by 18.3% to tion at the new facility will commence in Janu-
¥34.5 billion. ary 2013. The company plans to expand capac-
ity progressively until it reaches 17,000 tons by
Sub-segment (Billions of yen) the summer of 2013.
Fiscal 2010 2011 Changes Toretec® is widely used as a process film
Display Materials 105.6 90.3 -14% in the manufacture of LCD optical films and as
Electronic components, semiconductors, a surface protection film for plastic boards. The
92.7 86.2 -7%
electric circuit materials decision to establish a new production facility
Data storage materials 32.8 34.1 +4% in Taiwan was taken in response to requests
Equipment, others 30.9 32.8 +6% from major manufacturers in Taiwan, which
has the biggest share of the world market for
Outlook for fiscal 2012 light guide plates. It was also prompted by the
improvement of export competitiveness fol-
Production cutbacks by panel manufacturers are expected to give way to a recovery
lowing the signing of an economic cooperation
that should bring a gradual improvement in demand for materials for large FPDs in
framework agreement (ECFA) between Taiwan
the first half of the year. A return to demand growth is expected to emerge in the
and China.
second half, but customers will exert increasing downward pressure on prices. We
anticipate continued growth in demand for smartphone-
related materials.
Our priorities in this environment will be the ex-
pansion of sales of films and processed film products
for FDP applications and electronic components, the
development of high value-added products and the im-
provement of cost competitiveness. We will also target
increased sales of other products, including semiconduc-
tor materials and printing materials.
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