If a quality problem occurs, we will make a comprehensive judgment based on its hazard and diffusivity, and take appropriate measures. However, if a large-scale product collection that exceeds expectations occurs, the Group's business performance will be serious. It may have an impact. Therefore, we are working on promotion of work style reform, improvement of working environment, automation of work, labor saving and labor saving. (5) Information system Although the Group has established an appropriate system management system, there is a possibility that business operations may be hindered due to problems in system operation. (7) Fluctuations in crude oil prices In the processed food business, fluctuations in crude oil prices affect the procurement costs of commodities, raw materials, and fuels such as heavy oil. In addition, legal regulations, etc. in the relevant country are applied to the development of overseas business. If the cost burden for responding to environmental law revisions increases significantly in the future, it may have a significant impact on the Group's business performance. (13) Holding of fixed assets The Group owns a large number of distribution centers and production plants that require a large amount of capital investment. Regarding these strategically held stocks, we verify the medium- to long-term economic rationality for each individual stock, and sell the stocks that we judge to be of little significance.

(1) Outline of the status of business performance, etc. and the content of analysis / examination regarding the status of business performance, etc. from the perspective of the management ① Status of business performance, analysis, etc. In the Japanese economy during the current fiscal year, corporate performance and the employment income environment are improving. Although the gradual recovery trend continued, some weaknesses in exports and production were seen toward the end of the fiscal year. In the food logistics industry, equipment expansion has become prominent against the backdrop of expanding handling due to strong storage demand, while work costs, vehicle procurement costs, and electricity charges have risen. (Unit: million yen) Operating income (segment) Increase / decrease rate (%) YoY change rate (%) Processed food 226,5885,9012.714,596230.2 Fisheries 71,245 △ 266 △ 0.4182 △ 122 △ 40.3 Livestock 91,0766830.81,45215011.6 Low temperature distribution 201,0495,9553.111,3981421.3 Real estate 4,794 △ 74 △ 1.52,096 △ 55 △ 2.6 Other 5,7904458.3338 △ 473 △ 58.3 Adjustment amount △ 20,402 △ 535－ △ 553 △ 51－ Total 580, 14112,1092.129,511 △ 386 △ 1.3 (a) Processed food business << Industry topics >> In the processed food industry, demand for simple cooked foods and prepared foods such as prepared foods against the backdrop of an increase in single-person households and labor shortages Continued to be strong. << Points of business performance >> As a result of focusing on product development and sales activities centered on the main categories such as processed chicken products and cooked rice for both household and commercial use, sales of household cooked products expanded and sales increased. Focusing on product development and sales activities tailored to the needs of each business type, we are handling mainstay processed chicken products and the "Chef's Specialty" series supervised by famous chefs, in preparation for ready-to-eat meals where demand for commercial cooked products is strong. It has grown. 《Points of business performance》 Sales decreased due to careful purchases and sales in consideration of profitability. (C) Livestock business << Industry topics >> Domestic demand expanded, supported by strong meat consumption. In terms of profits, although cargo handling costs increased, profits increased due to continued promotion of measures such as business improvement and transportation efficiency. Overseas European regions saw a decrease in chicken imports and an increase in transportation and delivery costs due to the Brazilian meat fraud problem, but sales and profits increased due to steady capture of transportation demand such as transportation operations for retail stores and expansion of handling of imported fruit juice. I did. (E) Real estate business << Points of business performance >> In order to strengthen the competitiveness of rental office buildings, we carried out renewal work to maintain and improve the occupancy rate, but the end of residential land sales in Ushiku City, Ibaraki Prefecture and some rental offices Sales and profits declined due to the cost of acquiring earthquake-resistant marks in buildings. (F) Other businesses << Points of business performance >> Of the other businesses, the bioscience business established a new production / R & D base (although sales of biopharmacy raw materials and rapid diagnostics increased steadily, but sales increased. Profit declined due to temporary cost burdens due to the acquisition of a medical device company in Sayama City, Saitama Prefecture) and the United States. (2) Financial status and cash flow status and analysis, etc. (a) Financial status and analysis, etc. (Unit: million yen) Compared to the previous fiscal year (Assets) Current assets 153,564 160,5546,989 Fixed assets 213 , 703216,7032,999 (i) Total assets 367,268377,2579,988 [Debt / net assets] Current assets 110,48999,561 △ 10,927 Fixed assets 87,09893,8906,791 (ii) Total assets 197, 587193,451 △ 4,135 Of which interest-bearing debt (excluding lease obligations) 97,745 (79,844) 95,951 (78,923) △ 1,794 (△ 920) (iii) Total net assets 169,680 183,80514,124 (of which equity capital) (162,729) ( 176,820) (14,090) D / E ratio (double) (excluding lease obligations) 0.6 (0.5) 0.5 (0.4) △ 0.1 (△ 0.0) (Note) D / E ratio calculation method: Interest-bearing debt ÷ net assets (i) Points of total assets 377.2 billion yen (increase of 9.9 billion yen) Current assets increased by 6.9 billion yen due to strong sales and an increase in trade receivables, and tangible due to capital investment to expand the profit base of the main business. Fixed assets increased by 2.6 billion yen. (Iii) Points of cash flows from financing activities Due to dividend payments of 4.1 billion yen and repayment of interest-bearing debt, cash flows from financing activities were 9 billion yen. Estimates and judgments / evaluations are made based on factors that are considered to be rational depending on past performance and circumstances, but actual results may differ due to uncertainty peculiar to estimates. .. The Group has introduced a cash management system (CMS) that includes domestic consolidated subsidiaries, and the procurement of working capital and capital investment funds is mainly from the borrowing of the Company, the issuance of corporate bonds, and the business activities of each Group company. It is based on internal funds by concentrating the flow. For details, please refer to "1 Management Policy, Business Environment and Issues to be Addressed (2) Medium-Term Management Strategy, Target Management Indicators, Business Environment and Issues to be Addressed". 2 The above amount does not include consumption tax. (2) Purchase record (unit: million yen) Segment name Previous consolidated fiscal year (from April 1, 2017 to March 31, 2018) Current consolidated fiscal year (from April 1, 2018 to March 2019) 31st March) Increase / decrease rate (%) Processed foods 61,59264,0264.0 Fisheries 55,47353,843 △ 2.9 Livestock 76,99976,882 △ 0.2 Low temperature logistics 382212 △ 44.4 Real estate 151717.4 Others 985323 △ 67.2 Total 195,448 195,306 △ 0.1 (Note) 1-segment transactions are offset and eliminated. 3 The purchase record of "real estate" is the purchase price of the product. (3) Orders received The order results for the low temperature logistics segment (Nichirei Logistics Engineering Co., Ltd.) are as follows. Pre-destination consolidated fiscal year (from April 1, 2017 to March 31, 2018) Current consolidated fiscal year (from April 1, 2018 to March 31, 2019) Amount (million yen) Percentage (% ) Amount (million yen) Percentage (%) Mitsubishi Foods Co., Ltd. 73,09712.976,66613.23 The amounts in this table do not include consumption tax.

['Deliciousness Research',' ms nose®',' 19th Aroma Science Forum',' Research and Development','Low Temperature Logistics Business','Environment',' Artificial Intelligence','Manufacturing Processed Chicken ,'Processed chicken products','Production line',' x-ray inspection machine','Good products'〟〝 Hard bone mixed products','Disposal of processed chicken products',' Picking system','Bioscience business','Molecular diagnostic agents ',' Rapid diagnostics',' Automatic staining',' Influenza virus kit "Immunofine tmfluii',' ms nose®',' Food and health',' Deep psychology','Research institute',' Antifreeze sugar Proteins (Type ii',' Type ii',' 18th Standard Oil and Fat Analysis Seminar and Fragrance Journal',' ms nose®',' mental representation of domestic cooking operations among japanese consumers', 'international journal of gastronomy and food']

The breakdown by segment was 1,547 million yen for the processed food business, 296 million yen for the low-temperature logistics business, 364 million yen for other businesses, and 150 million yen for the entire company (common). In the current consolidated fiscal year, we jointly developed with an equipment manufacturer a technology to sort out "hard bones" that may remain in processed chicken products in the pre-packaging stage by artificial intelligence on our own processed chicken product production line. (2) Low-temperature logistics business As a countermeasure against labor shortages in the logistics business, we are working on technical verification and system development that contribute to labor saving and simplification of work. In the current consolidated fiscal year, we started selling several types of products such as the automatic staining device “Histtainer AT” for molecular diagnostics and the influenza virus kit “Immunofine ™ FLUⅡ” for rapid diagnostics.

3 [Analysis of financial position, operating results and cash flow by management] The Group's financial position, operating results and cash flows (hereinafter referred to as “operating results, etc.” in the current consolidated fiscal year. Preparation of consolidated financial statements) The important accounting policies adopted in the above are described in (Important matters that are the basis for preparing consolidated financial statements) in "Fifth Accounting Status 1 Consolidated Financial Statements, etc. (1) Notes on Consolidated Financial Statements". (Performance index) (Unit: 100 million yen) FY2017 results FY2018 results FY2019 outlook “Project AP-G2019” FY2019 target sales 22,049 23,888 25,300 27,000 Operating income 1,565 1,415 1,600 2,500 Operating income margin 7.1% 5.9% 6.3% 9% ROA 6.3% 5.3% Approx. 6% Approx. 9% ROE 9.1% 7.1% Approx. 8% Approx. 12% Sales for the current consolidated fiscal year increased in all segments except the life science business, and the previous consolidated accounting Sales increased by 184 billion yen (8.3%) from the previous fiscal year to a record high of 2,388.8 billion yen. Non-operating income decreased by 2.8 billion yen from the previous consolidated fiscal year due to an increase in expenses related to suspended facilities. Ordinary income decreased by 17.8 billion yen (11.7%) to 134.5 billion yen. (Textile business) In Japan, demand for industrial applications such as automobiles is generally strong, but clothing applications are affected by unseasonable weather. While cargo movements have been sluggish, in addition to expanding sales in various applications, we have promoted expansion of the cotton / textile / product integrated business and focused on strengthening our business structure. The production scale of major products is ahead of nylon yarn. Approximately 46.8 billion yen (based on selling price), a 1.3% decrease from the consolidated fiscal year, approximately 59.8 billion yen (based on selling price), a 0.6% increase in polyester yarn, and approximately 63 billion yen (sales), a 7.0% increase in polyester staples. (Price-based). (Functional chemicals business) In the resin business, sales were expanded for automobile applications and the price was passed on to the rise in raw material prices, but it was affected by the economic slowdown in China. As a result of the above, the environment・ In the engineering business as a whole, net sales increased 8.1% from the previous consolidated fiscal year to 257.7 billion yen, and operating income decreased 7.9% to 12.2 billion yen. (Status of production, orders and sales) Group (Company) And consolidated subsidiaries) produce and sell a wide variety of items, and even if they are of the same type, their forms, units, etc. are not always uniform. In addition, since many products do not take the form of build-to-order manufacturing, the production scale and order scale are not indicated by amount or quantity for each segment. The liabilities section increased by 167.7 billion yen from the end of the previous consolidated fiscal year to 1,574.4 billion yen, mainly due to the increase in interest-bearing debt. The equity ratio at the end of the current consolidated fiscal year decreased by 1.8 points from the end of the previous consolidated fiscal year to 40.6%, and the D / E ratio deteriorated by 0.11 points to 0.86 points. (Cash flow from financing activities) In the current consolidated fiscal year, the increase in funds from financing activities increased by 57.1 billion yen (92.5%) from the previous consolidated fiscal year to 118.9 billion yen. Of these, the outline of capital investment and plans for new construction of important equipment are described in "Status of Third Equipment". (3) Fiscal policy The Group raises funds by comprehensively considering the outlook for demand for funds and trends in financial markets, and then determining the optimal timing, scale, and means. In addition, under the basic policy of achieving both business expansion and strengthening of the financial structure, we are also working to improve asset efficiency, such as reducing working capital, improving the utilization rate of fixed assets, and effectively utilizing surplus funds within the group through a cash management system. .. In addition, in case of urgent need for funds or in case of financial market turmoil, we have concluded commitment line contracts, overdraft contracts, etc. with domestic and overseas financial institutions to ensure the liquidity of funds.

['ap-g 2019','Green Innovation','Life Innovation',' nanodesign®','Deep Colored tm Nylon','ultrasuede® bx','Ultrasuede Bx',' Americas', 'Treca® mx Series', '5','Research and Development','Organic Synthetic Chemistry','Polymer Chemistry','Biotechnology',' Threadmaking, Fiber Higher Processing','Organic Synthetic','Carbon Fiber Composite materials',' Medical equipment',' Water treatment',' Medium-term management issues',' New materials',' Intellectual property',' Finest fineness',' Suede-like artificial leather',' Polyphenylene sulfide resin', 'pps resin','transparency','offset printing machine','power saving led-uv',' Asia / emerging countries','tradeoff','elasticity','carbon fiber','autoclave' ,'Environmental / Engineering Business Functional Chemicals','Carbon Fiber Composite',' Reverse Penetration Membrane (ro Membrane) Element',' Flowing',' Polyphenylene sulfide) Ultrafiltration (uf) Membrane',' uf Membrane Creation','Life Science Business Focus',' trk-250',' USA',' trk-950','Composite Fiber',' Chemical Structure',' Bio',' For Blood Purification',' Chip', 'Markers for detecting dementia',' Obtaining approval for in vitro diagnostics','Phase i clinical trials','Orphan drugs',' Drugs for rare diseases',' Existing anticancer drugs','Therapeutic drugs' ,'Regenerative medicine','Environment','Life science']

(2) Functional chemical products business As a core business, we are working on research and technological development with the aim of strengthening our stable earnings base and expanding our strategic expansion business in the medium to long term with the aim of developing new products and adding value. In addition, the original nano-lamination technology has been further deepened, and the innovative layer arrangement design has the world's highest level of heat insulation against infrared rays from the sun, which causes temperature rise, while maintaining the transparency of glass. We have developed an innovative heat shield film. In addition, we have developed the world's first waterless offset printing machine for printing on flexible packaging materials for familiar products such as food and daily necessities. In addition, for PVDF (polyvinylidene fluoride) ultrafiltration (UF) membranes, which are being developed for water treatment applications in various fields, we will deepen the pore size control technology, effectively separate minute substances, and have high water permeability. We have succeeded in creating a UF membrane that has both properties. Furthermore, Phase I clinical trials of the nucleic acid drug "TRK-250", which has been jointly developed with Bonak Co., Ltd., have started in the United States. We will continue to accelerate development in collaboration with related organizations and aim to obtain early approval as a cancer treatment drug. As basic research and basic technology development that does not belong to the above segment, we make full use of our original functional polymer design technology to restore skin-like flexibility even if it is stretched 10 times the initial length without breaking. Created a new bioabsorbable polymer with. The total R & D expenses of the Group for the current consolidated fiscal year were 66.4 billion yen (of which Toray Industries, Inc.'s total R & D expenses were 48.8 billion yen).

(3) Issues to be addressed by the Group based on the business environment The Group has been implementing the three-year medium-term management plan “Cs for Tomorrow 2018” (hereinafter, “CT 2018”) since FY2016. In building a business foundation for sustainable growth, strengthening manufacturing equipment through earthquake resistance and renewal, strengthening human resource development by revising the advanced professional system, risk management, thorough compliance, strengthening quality assurance system, digital We have responded to transformations. In terms of figures, we achieved results that exceeded our profit targets (operating income of 180 billion yen, net income attributable to owners of the parent of 110 billion yen). By creating added value for businesses and products and improving productivity, we aim to sustainably improve corporate value and contribute to the realization of a sustainable society by returning the results to the world. .. We aim to be a company that is always trusted by society by thoroughly implementing the Sangen principle of acting with an emphasis on "on-site," "in-kind," and "reality." The Group will take these issues seriously, act "in good faith", boldly "challenge", and "create" new value. On top of that, we will aim to achieve sustainability, further improve corporate value, and achieve sustainable growth. (4) Basic Policy on Control of the Company The decision on whether or not to accept the act of mass acquisition of the Company's shares for the purpose of acquiring the control of the Company is ultimately the intention of all of the shareholders of the Company. We believe that this should be done on the basis of this, and we do not deny the acquisition of a large amount of our shares as long as it contributes to our corporate value and the common interests of our shareholders.

Regarding the performance of Sweden Senseair AB and its consolidated subsidiaries, which were completed on April 4, 2018, and the performance of Sage Automotive Interiors, Inc., which was completed on September 27, 2018 (Eastern Time). It is disclosed by including it in the "Materials" segment. Sales in the “Materials” segment were 1,176.2 billion yen, an increase of 88.5 billion yen from the previous fiscal year, and operating income was 129.6 billion yen, an increase of 7.6 billion yen from the previous fiscal year. In the high-performance materials business and consumer goods business, sales of ion exchange membranes and “Saran Wrap ™” were firm, but sales and profits decreased year on year due to a decrease in sales volume of electronic material products. It was. In the chemical business, in September 2018, we decided to replace the Nobeoka No. 3 coal-fired power plant in Nobeoka City, Miyazaki Prefecture with a natural gas-fired power plant. In the building materials business, sales and profits increased year on year due to an increase in the sales volume of each product. Sales in the “Healthcare” segment were 316.2 billion yen, an increase of 19.9 billion yen from the previous fiscal year, and operating income was 41.8 billion yen, an increase of 2.4 billion yen from the previous fiscal year. In the pharmaceutical business, in October 2018, we applied for manufacturing and marketing approval in Japan for the osteoporosis treatment “Teriparatide ™ Subcutaneous Injection 28.2 μg Autoinjector”. (Status of production, orders and sales) (1) Production performance The production items of the Group (the Company and its consolidated subsidiaries, the same shall apply hereinafter) are wide-ranging and diverse, and even if they are of the same type, their capacity, structure and format. Etc. are not always uniform, so the production scale is not shown by amount or quantity for each segment. (1) Important accounting policies and estimates The Group's consolidated financial statements are prepared based on accounting standards generally accepted in Japan. (Fixed assets) Fixed assets increased by 155.6 billion yen from the previous fiscal year to 1,523.8 billion yen due to an increase of 115.4 billion yen in intangible fixed assets. The cost of sales ratio for the current fiscal year was 68.3%, a deterioration of 0.1 points from the previous fiscal year. (Net income attributable to owners of the parent) As a result of deducting extraordinary gains / losses of 9.6 billion yen from ordinary income of 220 billion yen, income before income taxes and minority interests was 210.4 billion yen. (4) Cash flow analysis Free cash flow (total amount of cash flow from operating activities and cash flow from investing activities) for the current period is income from income before tax adjustment, etc. Revenue of 13.1 billion yen exceeded expenditures for the acquisition of fixed assets and the acquisition of shares of subsidiaries due to changes in the scope of consolidation. As a result of the above, the balance of cash and cash equivalents at the end of the period increased by 31.9 billion yen from the end of the previous fiscal year to 180.5 billion yen. (Cash flow from financing activities) Cash flow from financing activities for the current fiscal year included expenditures of 53.8 billion yen for repayment of long-term debt and dividend payments of 51.7 billion yen, but income from long-term debt was 85.5 billion yen. Revenue of 17.4 billion yen (an increase of 151.8 billion yen from the previous fiscal year) was due to an increase of 57 billion yen in commercial paper. In the next medium-term management plan, these funds will be used as strategic investment funds for the realization of a sustainable society and continuous improvement of corporate value, and as a source of dividends to shareholders, while continuing to strengthen the business foundation. I will continue to do it.

['Roika tm','Bemberg tm',' Leona tm',' computer aided engineering',' Resource saving / energy saving',' Visible outside light','Realization of long-life housing',' qol', '5' ,'R & D','Achievements and R & D expenses',' Polyurethane','Nylon 66 fiber','Comfortable life','High-performance textile','New basic non-woven fabric','In Mizushima factory',' Diphenyl Carbonate','Easy formability','Fluorine ion',' Electronic device','Reducing environmental load',' Lithium ion secondary battery',' Separator',' Separator for storage battery',' Electronic parts',' High frequency',' End user',' R & D expenses related to this segment',' Seismic resistance',' Heat / air','Environmental technology','Environmental responsiveness','Carbonization technology','Lightweight bubble concrete' ,'High-performance basic system','Steel construction',' R & D expenses related to the segment',' Healthcare'segment','Orthopedic surgery',' Utilization of market channels','Europe','Germany design award special mention category 2019','artificial kidney','blood purification technology','critical care business','clinician','pursuit of high added value','new business development','professional','ai' ,'Digital technology','Intellectual property area','World','Infrared small light receiving / emitting element',' Air quality',' Alcohol','Environmental energy',' akxytm',' akxytm' ,'Company-wide R & D expenses']

"Materials" segment (textile business) In the textile business, we are working to enhance and enhance our R & D functions and speed up the realization of results through collaboration with both inside and outside the group. In the high-performance materials business and consumer goods business, we will strengthen the development of fluorine-based ion exchange membranes for environmentally friendly salt electrolysis processes, and in the field of electronic materials, photosensitive resin materials that can meet the demands of next-generation electronic devices. Is accelerating the development of. The amount of R & D expenses related to this segment is 33,919 million yen. In addition to reducing the amount of living energy consumed in homes, we are researching comfort from the perspective of human physiology and psychology, and are focusing on developing technology that realizes an environment-friendly home that balances health and comfort with energy conservation. The amount of R & D expenses related to this segment is 37,183 million yen. In the current fiscal year, the system will be expanded to the unique areas of each business division that bears the business foundation and clerical occupations, and the human resources who will lead those areas will be newly appointed to highly specialized positions to strengthen new businesses and businesses. We are trying to participate and contribute. Specific examples of "pursuit of high added value" include "development of a new membrane system capable of highly concentrating liquids" and "development of the world's smallest high-precision, low-power consumption CO2 sensor". Regarding "utilization of market channels", through the concept car "AKXY ™", we are proposing to our customers various key items that contribute to improving the safety and comfort of automobiles and contributing to the environment. I will.

3 [Analysis of Financial Status, Business Performance and Cash Flow Status by Management](1) Overview of Business Performance Status Overview of the Group's Financial Status, Business Performance and Cash Flow Status in the Current Consolidated Fiscal Year Is as follows. Current liabilities were 497.7 billion yen (up 76 billion yen). The core-based results exclude non-recurring items specified by the Company from the full-based results as adjustment items. Core operating income / core net income and gross profit were 1,014.3 billion yen (up 0.8% year on year). Revenue, operating income, income before income taxes, and net income all increased. Full-based performance includes “other income” and “other expenses” (impairment loss, foreign exchange loss, etc.) that are excluded from core-based performance. Sales increased in all regions of Japan, the Americas, EMEA and Asia / Oceania. ◇ Prograf ・ Sales were 195.7 billion yen (down 1.4% year-on-year). ◇ Status of other new products and major products ・ In Japan, in addition to the increase in sales together with the Sujanu combination tablet released by Sugra, a treatment for type 2 diabetes, in May 2018, Repatha, a treatment for hypercholesterolemia, Sales of Lindes, a therapeutic agent for chronic constipation, continued to grow. (2) Cash flow status [Cash flow from operating activities] Cash flow from operating activities for the current consolidated fiscal year was 258.6 billion yen (down 54 billion yen from the previous consolidated fiscal year).・ The amount of dividends paid was 72.1 billion yen (up 400 million yen). c. Sales performance The sales performance for the current consolidated fiscal year is shown below for each segment. (1) Important accounting policies and estimates The Group prepares consolidated financial statements in accordance with IFRS. (2) Awareness, analysis, and examination of the status of business results, etc. for the current consolidated fiscal year Regarding the recognition, analysis, and examination of the status of business results, etc., see "2. Business Status 3 Financial Status, Business Performance, and Cash by Management"・ Analysis of flow status (1) Outline of status such as business performance ① Financial status and status of business performance ”. [Fiscal Policy] Against the background of these financial bases, the Group strives to sustainably improve its corporate value and actively strive to return profits to shareholders. As a result, under IFRS, R & D expenses related to lump-sum contract payments and milestone payments have decreased by ¥ 2,256 million in the previous consolidated fiscal year and ¥ 9,128 million in the current consolidated fiscal year compared to Japanese GAAP.

['Management Plan 2018','Further Pursuit of Operational Excellence','Challenge to rx + tm Program','Japan','Phase iii Prosper Examination','US','Europe','Phase iii arches study',' late phase ii study','phase ii study','phase iii study','ipragliflozin','l-proline','eborocumab','large cyclic antibacterial agent duff clear', 'Brinatumomab','Research and development',' focus','area','Focus late development','Therapeutic agent xtandi',' Generic name','Xtanji tablets',' Diagnostic imaging',' Survival ',' flt3',' Zospata',' flt3 gene mutation positive',' Oral administration',' Hypoxia-inducing factor proline hydroxylase inhibitor',' asp1517 / fg-4592','Receptor antagonist', 'esn364','Antibody-drug complex enholtumabbedotin',' asg-22me','Platinum preparation',' Chemotherapy and immune checkpoint inhibitor',' Anti-claudin 18.2 monoclonal antibody',' imab362',' Approved',' dpp-4 inhibitor','Janubia','citagliptin phosphate hydrate','Sugra',' Type 2 diabetes treatment','hypercholesterolemia treatment repatha','Genet set Replacement',' statin',' antineoplastic agent',' bispecific antibody preparation berinsite','certrizumab pegol',' simdia','subcutaneous injection 200 mg autoclicks','romosozumab','peficitinib ',' gt0001x',' China',' jvs-100',' Additional indications and dosages',' Degalerix acetate',' Dosage',' Gonax',' Subcutaneous injection',' Additional indications and additions' Agents','Bisonotape 2 mg',' Oral jak (Yanus kinase) inhibitor','Smiraf','Hydrogen bromide','Genetherapy','Capital investment','Early clinical investigational drug','Regeneration Medical',' (UK','Spontaneous myotrophic lateral sclerosis','Gene treatment program','Issens contract',' Exclusive joint research and development contract',' Exclusive option right',' Immunotherapy program','Sales revenue R & D expenses']

As part of our efforts to maximize product value, we prioritized management resources to the six priority late-stage development products that will support growth from fiscal 2020 onward, and steadily proceeded with development. In addition, we achieved the primary endpoint in all six Phase III trials for filing in Europe.・ Januvia (generic name: sitagliptin phosphate hydrate), a selective DPP-4 inhibitor manufactured and sold by MSD Co., Ltd., and Sugra (generic name: ipragliflozin L-proline), a selective SGLT2 inhibitor manufactured and sold by our company. In May 2018, we launched Sujanu Combination Tablets, a combination drug for the treatment of type 2 diabetes.・ A joint development company for the indication of "relapsed or refractory B-cell acute lymphoblastic leukemia" for antineoplastic agents / bispecific antibody preparations berinsite (generic name: blinatumomab (genetical recombination)) Astellas Amgen Biopharmaceutical Co., Ltd. received approval in September 2018, and it was launched in November of the same year. -Regarding the prostate cancer therapeutic agent Gonax (generic name: degarelix acetate), approval of partial change of dosage form and additional dose of maintenance dose at 12-week intervals and approval of 240 mg of Gonax subcutaneous injection used in the dosage form (approval of subcutaneous injection) (Additional dosage form) was acquired in January 2019. In the United States, we are making capital investments to accelerate research and development in the fields of regenerative medicine and cell medicine and to expand manufacturing facilities. The main initiatives in the current consolidated fiscal year are as follows.・ In December 2018, Potenza (USA), a cancer immunity-related biotechnology company, was acquired by exercising its exclusive option right to acquire the company based on the exclusive joint research and development agreement concluded in 2015. Made a wholly owned subsidiary of.

For sales by segment, sales to external customers are shown. b. China / Asia Housing Equipment Business In the current consolidated fiscal year, sales were 63,539 million yen (down 11.7% from the previous year) and operating income was 12,395 million yen (down 11.7% from the previous year). It decreased by 31.7% from the previous term). The Group is promoting business activities by utilizing its strengths as a luxury brand while paying close attention to changes in the market environment and consumer purchasing behavior, mainly in urban areas of the first to second and third lines. .. In addition, we are working to spread the word by strengthening the promotion of "Washlet". The latest home appliances exhibition "CES2019 (Consumer Electronics Show 2019)" held in Las Vegas in January 2019, and the largest water-related equipment exhibition "KBIS2019 (Kitchen & Bath Industry)" in the United States held in February 2019. We exhibited at "Show 2019)". In the current consolidated fiscal year, sales were 3,778 million yen (up 5.3% from the previous fiscal year) and operating loss was 1,140 million yen (operating loss was 10 in the previous consolidated fiscal year). It was 332 million yen). We are strengthening our value appeal to our customers through exhibitions, seminars, and showroom exhibitions by launching new products with high design that meet the tastes of European customers. Positioning the new factory as a mass production factory for "Washlet," construction will begin in May 2018, with the aim of full-scale operation from April 2020. -Selected as a constituent of the ESG investment index "Dow Jones Sustainability World Index" It was selected as a constituent of the "World Index" of the world's leading ESG investment index "Dow Jones Sustainability Indices". This is the 7th selection for the same brand.・ Received the internationally prestigious design award At the internationally prestigious design award "iF Design Award 2019", the washlet integrated toilet "Neorest AH / RH" "wall-mounted RP toilet + washlet RX" "table" "Single mixed faucet GM series with attached" was awarded. (Cash flow from investing activities) Investment activities resulted in an expenditure of 26,928 million yen. This is due to income from the issuance of commercial paper, such as 62.1 billion yen, expenditure from redemption of commercial paper, 33.5 billion yen, and dividend payments of 13,712 million yen. Production, Orders and Sales Results (1) Production Results The production results for the current consolidated fiscal year are shown below for each segment. Segment name Amount (million yen) YoY (%) Japan 362,7560.8 China 90,654 △ 4.3 Asia / Oceania 55,4554.7 Americas 29,2762.9 Europe 2,819 △ 5.6 Global housing equipment business Total 540,9630.3 Ceramic business 20,21231.9 Environment Building Materials Business 7,015 △ 2.4 New Area Business Total 27,22820.9 Reported Segments Total 568,1921.2 Others --- Total 568,1921.2 (Note) 1. The amount is displayed as a selling price conversion value. 2. The above amounts do not include consumption tax.

['Hydrotect','R & D',' R & D expenses for the segment']

5 [R & D activities] In the R & D department, in order to integrate design and function and realize a clean and comfortable space, we will evolve the "only one technology" that only we can do, and provide customers with the value unique to TOTO. doing. "Seeing people" technology that quantifies human movements and sensations, such as ergonomics and kansei engineering, and logically realizes ease of use and comfort. R & D expenses for this segment are 14,627 million yen. b. China / Asia Housing Equipment Business, Americas / Europe Housing Equipment Business China / Asia Housing Equipment Business, Americas / Europe Housing Equipment Business, based on the core technology developed in Japan, while maintaining high functionality and high quality We are developing environmentally friendly products that meet the regulations and standards of each country, and are advancing design designs that suit each region. "Hydrotect" is not limited to application to our own products, but we are aiming for further spread through various building materials together with partner companies, and contribute to environmental conservation widely in Japan and overseas. The total R & D expenses for the new area business are 2,856 million yen, and the R & D expenses for each segment are 2,271 million yen for the ceramic business and 585 million yen for the environmental building materials business, respectively.

3 [Analysis of financial status, operating results and cash flow status by management](Summary of status of operating results, etc.) "Partial revision of" Accounting Standards for Tax Effect Accounting "" (Corporate Accounting Standard No. 28) (February 16, 2018), etc. have been applied from the beginning of the current consolidated fiscal year, and the financial status is compared and analyzed with the figures after applying the relevant accounting standards retroactively. We are doing. In Japan's economy, although personal consumption and capital investment remained strong, exports slowed and the pace of growth was slow. In terms of profits, operating income was 276,254 million yen (up 8.9% year on year) and ordinary income was 277,074 million yen (up 8.6% year on year). Industry demand for domestic commercial air conditioners remained firm due to increased capital investment. Sales of residential air-conditioning equipment in India increased due to the expansion of the dealer network and sales expansion in local cities, and sales of commercial air-conditioning equipment also increased steadily, resulting in higher sales than the previous fiscal year. Operating income increased 27.5% year on year to 32,533 million yen. Sales of fluororubber also exceeded the previous year's level due to strong demand in the automobile-related and semiconductor-related fields in the domestic and US markets. As a result, overall sales of chemical products exceeded the previous year's level. Sales of hydraulic equipment for construction machinery and vehicles increased year on year due to strong sales to major domestic and US customers. Liability increased by 122,654 million yen from the end of the previous consolidated fiscal year to 1,254,040 million yen due to an increase in short-term borrowings. (Status of production, orders and sales) (1) Production results The production results for the current consolidated fiscal year are shown below for each segment. 2 The above amount does not include consumption tax. Net assets increased by 122,528 million yen from the end of the previous consolidated fiscal year to 1,446,894 million yen due to an increase due to the recording of net income attributable to owners of the parent company. Regarding the operating income of the segment, in the air conditioner / refrigerator business, operating income increased 6.3% from the previous consolidated fiscal year to 237,645 million yen, and in the chemical business, it increased by 27.5% from the previous consolidated fiscal year to 325. Operating income was 333 million yen, and other businesses recorded operating income of 6,065 million yen, up 27.5% from the previous consolidated fiscal year. In investment activities, expenditures increased by 38,314 million yen from the previous consolidated fiscal year to 165,773 million yen due to an increase in expenditures due to the acquisition of consolidated subsidiaries. In principle, funds are procured by accumulating retained earnings and focusing on own funds, but if necessary, we procure funds by borrowing from financial institutions or corporate bonds. Fiscal year ending March 31, 2016 Fiscal year ending March 31, 2017 Fiscal year ending March 2018 Fiscal year ending March 2019 Equity ratio (%) 45.346.347.252.452.4 Equity ratio based on market value (%) 103.7112.1138.8138.6140.5 Cash flow to interest-bearing debt ratio (year) 4.12.72.32.52.3 Interest coverage ratio (times) 16.825.926.820.921.2 (Note) Equity ratio: Equity ratio: Equity ratio based on market value of total assets: Total market value of shares / Total assets Cash flow to interest-bearing debt ratio: Interest-bearing debt / Operating cash flow Interest coverage ratio: Operating cash flow / Interest payment * Each index is calculated based on consolidated financial figures. * Market capitalization is calculated by multiplying the closing price of the stock price at the end of the period by the number of shares issued at the end of the period (after deducting treasury stock). * Operating cash flows are based on operating activities on the consolidated statement of cash flows. * Interest-bearing debt covers all debts that are paying interest among the debts recorded on the consolidated balance sheet.

['Industry-Academia Collaborative Creation Agreement','China','cresnect',' Wall-mounted Air Conditioner'Urusara 7','Caraier','Urusara 7','Sky Air','five star zeas' Series',' eco-zeas','Streamer internal clean',' vrv x',' vrv a',' Microchannel heat exchanger',' green multi',' hfc-32',' r- 410a',' North America',' rebel',' R & D',' Global warming',' Energy problems',' Global environmental problems','Future office space','Co-creative platform',' Air conditioning equipment ',' Air conditioner',' No water supply and humidification',' Streamer',' led',' Nighttime monitoring',' Outdoor unit',' Aluminum',' Aluminum',' Heat exchanger',' Large capacity compressor ',' Heat Exchange',' Low Warming Refrigerant hfc-32',' Global Warming Potential',' Energy Efficiency',' Warming',' Kigari Revision',' Air Han',' With Total Heat Exchange Function Small size',' Europe',' Heat pump module chiller',' tic',' Super unit',' Asia',' f gas regulation',' Low gwp refrigerant',' Refrigerant r32',' Freakling',' gb Standards','Fluorine Resin',' Textile Treatment Agent',' Carpet Treatment Agent',' Artificial Intelligence','Composite Material',' Fluorochemical Global',' Power Semiconductor',' Polypropylene','Dielectricity', 'New Material',' Inverter',' Hybrid Hydraulic System',' Different Voltage Power Supply',' Hydraulic Hybrid System',' Bullet']

By promoting and co-creating industry-academia collaborations and various industry-academia collaborations with Kyoto University, Seika University in China, Beijing University, etc., which are already affiliated, we will create innovation, solve complex social issues, and create new businesses. Will be created. Applying the "non-water supply humidification" technology installed in our room air conditioner "Urusara 7", the moisture contained in the indoor air is absorbed by the adsorption material (desiccant element), and it remains a gas as high humidity air. By discharging it outdoors, it is possible to dehumidify without the need for water disposal work. As a new model of the store / office air conditioner "SkyAir" in commercial air conditioners, "FIVE STAR ZEAS" is the only one in the industry that realizes more comfort than ever by setting the temperature and dehumidification level at the same time. The "Zias" series and the "Eco-ZEAS" series were released in April 2018. Compared to the conventional R-410A, HFC-32 has a lower global warming potential (GWP), is more energy efficient, and can reduce the amount of refrigerant charged. Therefore, the effect of the refrigerant of this product on warming is greater than that of the conventional model. Achieve a 76% reduction. In Europe, while the demand for low GWP refrigerant is increasing due to F gas regulation and energy saving regulation, the non-inverter scroll chiller using refrigerant R32 was released in July 2018 ahead of the industry, and freaking specification machine is also available. It was released in November 2018. For fluororesins and rubbers, we are conducting research on differentiated new products in automobiles, semiconductors, wires & cables (IT field), etc. by taking advantage of the heat resistance, chemical resistance, dielectric properties, etc. that fluorine materials are good at. (3) Other businesses In the oil machinery industry, we have realized energy saving and high functionality that cannot be achieved by conventional hydraulic systems by taking advantage of the features of the hybrid hydraulic system, which is a product that combines hydraulic technology and inverter technology. R & D expenses related to other businesses are 1,898 million yen.

The outline of the situation of) is as follows. (1) Financial status and operating results The Japanese economy in the current consolidated fiscal year showed a gradual recovery due to steady personal consumption and corporate profits in the first half of the fiscal year, but the US-China trade friction started in the latter half of the fiscal year. Uncertainty about the future has increased due to the deterioration of business sentiment and the decrease in exports due to the slowdown of the world economy. As a result, sales for the current consolidated fiscal year were 188,324 million yen, an increase of 11,897 million yen (6.7%) from the previous consolidated fiscal year, and operating income was 47,750 million yen, 6,743 million yen compared to the previous consolidated fiscal year. Profit increased by 10,000 yen (16.4%). Electronic equipment business The electronic equipment business includes electronic devices (electronic devices such as backlights for liquid crystal, sensing devices (measuring equipment), etc.), spindle motors for HDDs, stepping motors, DC motors, air movers (fan motors), precision motors, and The main products are special equipment. Net cash used in financing activities was 13,334 million yen (27,026 million yen in the previous consolidated fiscal year). 2. The above amount is the amount after offsetting elimination of inter-segment transactions. (Iii) Sales results The sales results for the current consolidated fiscal year are shown below for each segment. Segment name Current consolidated fiscal year (April 1, 2018 to March 31, 2019) Year-on-year comparison (%) Machined products (million yen) 188,324106.7 Electronic equipment (million yen) 387,29385.7 Mitsumi Business (Million Yen) 308,423122.2 Others (Million Yen) 68398.7 Total (Million Yen) 884,723100.4 (Note) 1. The above amount does not include consumption tax. Important accounting policies for preparing consolidated financial statements are described in "5. Accounting Status 1 Consolidated Financial Statements, etc. Notes to Consolidated Financial Statements 3. Important Accounting Policies 4. Important Accounting Judgments, Estimates and Assumptions" Doing. Liability at the end of the current consolidated fiscal year was 334,867 million yen, a decrease of 5,470 million yen from the end of the previous consolidated fiscal year. Regarding sales and operating income by segment, see "2. Business Status 3 Analysis of Financial Status, Business Performance and Cash Flow Status by Management (1) Overview of Business Performance, etc. (1) Financial Status and Business Performance It is described in "Status of". The main demand for working capital of the Group is operating expenses such as manufacturing costs, selling, general and administrative expenses. The balance of cash and cash equivalents at the end of the current consolidated fiscal year was 122,432 million yen. March 2019 (actual) March 2020 (plan) March 2021 (plan) March 2022 (plan) Sales (100 million yen) 8,84710,300 11,00012,000 Operating income ( (100 million yen) 7207701,0001,100 In the machined products business, we aim for sales of 215 billion yen and operating income of 60 billion yen in the fiscal year ending March 2022. For motors such as stepping motors, we will continue to improve quality and reduce costs, and promote sales of high-value-added products for automobiles, information and communication equipment, home appliances, etc. to further improve business performance. (3) Information on differences in major items related to an overview of the status of operating results, etc. Major items in the consolidated financial statements prepared by IFRS and the rules for consolidated financial statements (excluding Chapters 7 and 8 (excluding goodwill amortization). ) Goodwill was amortized over a certain period of time under Japanese GAAP, but IFRS does not amortize goodwill and conducts an impairment test every period. (Capital financial products) Under Japanese GAAP, for capital financial products Although goodwill and impairment loss were regarded as profit and loss, IFRS recognizes fluctuations in fair value as other comprehensive income for equity financial products that have been selected to be measured at fair value through other comprehensive income. However, if the recognition is stopped, it will be transferred to retained earnings.

['Switzerland','Cambodia','saliot','minegetm','Mitsumi Business Mitsumi','Miniaturization',' Quietness','Reliability','Magnetic Application Technology','R & D',' hdd','fluid bearing','for mobile ultra-thin LCD','backlight light guide plate',' injection molding','ultra-thin light guide plate for smartphone','backlight automatic assembly machine',' led Lighting',' Thin lens',' led',' paradox engineering sa','Wireless','Smart building',' Smart city','Greenhouse effect','Bilateral credit system',' High efficiency wireless control With LED street','Light distribution angle','Measuring equipment','High sensitivity','Minege tm)','Resistance',' Mobile',' Robotics','Actuator','Camera correction mechanism', 'Thinning',' Micro Electromechanical System',' Resonant Device']

The Group's R & D expenses for the current consolidated fiscal year were 25,453 million yen, including basic research expenses of 1,997 million yen that could not be allocated to each segment, such as analysis of various materials conducted at the Material Science Lab. We Included. We have obtained the certification of AS81934, which is an aerospace standard). In addition, reliability design and application design such as low dust generation, high heat resistance, long life and conductivity, in order to meet the demands of applications in new fields such as IT industry, home appliance industry, automobile industry, aircraft industry and medical equipment industry. We are developing with an emphasis on. Electronic Equipment Business Motors that are one of the mainstays of the electronic equipment business include HDD spindle motors, stepping motors, DC motors, air movers (fan motors), and precision motors. Regarding magnetic application technology, we are conducting research and development on material technology and manufacturing technology, and as a result, high-performance products such as rare earth bond magnets for various high-performance motors and high-heat-resistant magnets have been created. In addition, we are developing LED lighting products that combine thin lenses for LED lighting and LED lighting circuits by applying the optical technology cultivated in backlights. Using this kind of business as a foothold, we are promoting the development of technologies that can contribute to the realization of smart cities. R & D expenses in this project are 9,624 million yen.

3 [Analysis of Financial Status, Business Performance and Cash Flow Status by Management](1) Overview of Business Performance Status Overview of the Group's Financial Status, Business Performance and Cash Flow Status in the Current Consolidated Fiscal Year Is as follows. In the ICT (Information and Communication Technology) market, production volume fell slightly below the level of the previous consolidated fiscal year due to factors such as the prolonged replacement cycle of smartphones. The Group's business segments are classified into four reporting segments, "passive components," "sensor application products," "magnetic application products," and "energy application products," and "others," which do not belong to them. The consolidated results of the magnetic application products segment were net sales of 272,807 million yen (277,548 million yen, down 1.7% year on year) and segment profit of 17,022 million yen (16,128 million yen, up 5.5% year on year). It was. (2) Cash flow status (cash flow from operating activities) Cash flow obtained from operating activities was 140,274 million yen, an increase of 48,964 million yen from the previous consolidated fiscal year. This was mainly due to a decrease in acquisitions of subsidiaries. Name of segment by business type Production performance (million yen) Increase / decrease compared to the previous consolidated fiscal year (%) Passive parts 430,631 △ 4.4 Sensor application products 81,1501.8 Magnetic application products 268,227 △ 20.7 Energy application products 558,91646.3 Others 60,89711.4 Total 1,399,8217.2 (Note) 1. The amount is calculated based on the selling price. b. Orders received The table below shows the order results for the current consolidated fiscal year by business segment. The Group is reviewing its book value based on past demand and future forecasts, taking into consideration the possibility of excess inventories and obsolescence. Accounting for business combinations The Group uses the acquisition method to account for business combinations. Goodwill and other intangible assets Goodwill and other intangible assets with unspecified useful lives are not amortized and are subject to impairment testing annually or whenever there are signs or changes in fair value below book value. It will be carried out. Management has determined that future cash flow and fair value estimates are reasonable, but future cash flows and fair value estimates are below initial estimates due to unpredictable changes in business performance. In this case, the valuation of the asset may be adversely affected. The Group sets long-term expected rates of return based on long-term expected operating income forecasts for various asset categories to be invested. Decreasing the discount rate can increase pension benefit obligations and increase pension costs by amortizing actuarial gains and losses. Considering the past level of taxable income and the outlook for future taxable income during the period in which deferred tax assets can be deducted, the Group considers that deferred tax assets after deduction of valuation allowances are not expected to be realized. I think it's big. (2) Awareness, analysis, and examination of the status of operating results, etc. in the current consolidated fiscal year Factors that have had a significant impact on operating results and operating results. It increased by 1,381,806 million yen and operating income increased by 20.2% to 107,823 million yen. The Group's basic policy is to secure a stable source of liquidity and funds necessary for business operations, and liquidity funds including cash and deposits, short-term investments, securities, etc. are the monthly consolidated sales. We strive to maintain more than 2.0 months. ROE for the current consolidated fiscal year was 9.7%. Recognizing, analyzing, and examining the financial position and operating results of each segment (passive parts segment) The passive parts segment consists of (1) capacitors, (2) inductive devices, and (3) other passive parts. 433,406 million yen (417,757 million yen in the previous consolidated fiscal year, 3.7% increase from the previous consolidated fiscal year), segment profit 58,438 million yen (50,246 million yen, 16.3% increase from the previous consolidated fiscal year), segment assets 651,154 million yen It was JPY (643,605 million yen, up 1.2% YoY). Sales to the automobile market and ICT market increased, but sales to the industrial equipment market decreased. Sales of HDD heads and HDD suspensions for the ICT market decreased. Sales of magnets to the industrial equipment market decreased. (Energy application product segment) The energy application product segment consists of energy devices (secondary batteries) and power supplies. The consolidated results of this segment are net sales of 537,502 million yen (442,822 million yen, up 21.4% year on year). ), Segment profit was 91,036 million yen (72,351 million yen, up 25.8% year on year), and segment assets were 661,595 million yen (571,066 million yen, up 15.9% year on year). Sales of energy devices increased significantly for the ICT market.

['Sensors / Actuators','mems','sesub','Japan','North America','Europe','China','R & D','Manufacturing','Electronic Devices','Miniaturization' ,'Energy saving','Technology strategy','Electronic components','Motor','ic built-in board','Engineer','Chip','Actuator product','Sensor application product business','Sensor element ',' Magnetic Applied Products Business','Electric Vehicle Devices',' Energy Applied Products Business','Next Generation Lithium','Research and Development','Industry-Government-Academia','Organizational Collaboration Agreement']

5 [R & D activities] The Group's R & D activities are continuously strengthening and expanding new product development in order to respond to the diversifying electronics fields. Based on the technology strategy that captures the market changes in these three areas of focus, we have positioned sensors / actuators, energy units, and next-generation electronic components, which are expected to grow in the future, as growth strategy products, and are doing business in the IoT market. We are focusing on strengthening with the aim of capturing opportunities. We aim to provide a wide range of sensor solutions to our customers by connecting MEMS and software technologies to sensors and actuators. For energy units, we are developing products that combine batteries, power supplies, contactless power supply, etc. We are also focusing on the development of magnets, which are expanding for motors. In the passive parts business field, we are working to reduce the size and improve the performance of next-generation multilayer ceramic chip capacitors, inductor products, and EMC countermeasure parts that utilize core technology.

The Company, Renault and Mitsubishi Motors announced their intention to establish a new Alliance Operating Board (hereinafter referred to as the Alliance Board) in March 2019. The Group has fulfilled its mission by working on "Nissan MOVE to 2022" in anticipation of major technological innovations that will come in earnest in the next 10 to 15 years and the accompanying changes in the market and customers. I will go. In response to this, we reported to the Ministry of Land, Infrastructure, Transport and Tourism on May 17, 1945 regarding the status of our business improvement. A former representative director of the Company was indicted for violating the Financial Instruments and Exchange Act (a crime of submitting a false securities report), and a former chairman of the company was also charged with a violation of the Companies Act (a crime of special impersonation). This is the best estimate based on the information available to us and the amount not processed in the financial information of previous years, specifically (a) the payment has been deferred and has not been paid. Recording of Mr. Gone's compensation expenses that were recorded, (b) Reversal of recording expenses for Mr. Gone's executive retirement benefits that were increased without legal grounds, (c) Legal of stock price-linked incentive compensation This is a batch process of reversal of recording costs for invalid programs. The investigation is still underway, and the final amount may differ from the estimated amount in the future. Amount for each fiscal year (million yen) Fiscal year ending March 2006 59 Fiscal year ending March 2007 134 Fiscal year ending March 2008 397 Fiscal year ending March 2009-FY03 / 2010 228 Fiscal year ending March 2011 795 Fiscal year ending March 2012 907 Fiscal year ending March 2013 1,038 Fiscal year ending March 2014 △ 1,660 Fiscal year ending March 2015 △ 106 Fiscal year ending March 2016 1,127 Fiscal year ending March 2017 498 March 2018 Period 994 Total 4,411 As a result of our investigation, it was found that there is a transaction between our consolidated subsidiary and DEXTAR WORLD TRADE LIMITED, LLC, a company in which a close relative of our former director Carlos Gone is involved in management. did. Details of the transactions found are as follows.

Matters concerning the future in the text are based on the judgment of the Group as of the date of submission of the securities report (June 27, 1st year of Reiwa). 1. 1. Rapid fluctuations in the world economy and economy (1) Economic conditions The demand for products and services of the Group is strongly influenced by the economic conditions of the countries or regions that provide them. If there are sudden fluctuations that exceed expectations, it may affect the Group's business performance and financial condition, such as deterioration of business performance and opportunity loss. In addition, it is expected that the center of added value will shift from the performance of the car as hardware to the software, such as what kind of experience can be provided to customers, including services related to the car. In addition, the Group may conduct derivative transactions for the purpose of avoiding the risk of exchange rate fluctuations of foreign currency-denominated debts and credits, avoiding the risk of interest rate fluctuations of interest-bearing debt procured at floating interest rates, and avoiding the risk of commodity price fluctuations. However, if an unexpected large-scale change occurs in the market environment, it may hinder the financing as originally planned and may have a negative impact on the Group's business performance and financial condition. .. (5) Risk of sales finance business The sales finance business is one of the important businesses of the Group. If the actual results differ from the assumptions, or if the assumptions are changed, the effects will be cumulative and will be recognized regularly in the future and will generally affect the costs and liabilities recognized in the future period. May be given. However, due to unexpected changes in the environment, changes in world needs, and a decline in relative development competitiveness, there is a possibility that the new technology will not be accepted by customers in the end, and as a result, the Group's business performance will be affected. It can have a big impact. However, the adoption of new technology to offer higher added value, even if it is thoroughly scrutinized, can later raise unexpected quality issues such as product liability and product recalls. is there. In particular, the amount of CO2 emitted when using a car is significantly higher than the amount emitted by corporate activities, accounting for more than 80% of the total, so there is a possibility that there will be risks such as regulations due to climate change (value). Of the 216,351 kton-CO2 CO2 emissions of the entire chain, the emissions of the sold cars when used are 190,261 kton-CO2, both of which were actual results in FY2017). Through such efforts, the "Nissan Green Program 2022" aims to reduce CO2 emissions per new vehicle by 40% in the 4th year of Reiwa. (8) Limitations of intellectual asset protection The Group possesses technologies and know-how that can be differentiated from other companies' products. (9) Securing excellent human resources We consider human resources to be the most important asset, and we hire excellent human resources globally, and at the same time, enhance human resource development and have high fairness and transparency so that we can fully demonstrate our abilities. We are also focusing on the realization of an evaluation system. On the other hand, from 2018 to 2019, the former representative director of the Company was indicted for violating the Financial Instruments and Exchange Act (crime of submitting a false securities report), and the former chairman of the board was indicted for violating the Companies Act (special offense of impersonation). ) But was also charged. It is assumed that it is the second and third or later suppliers and sellers who have performed inappropriate acts in light of corporate social responsibility, or those related to products distributed through sales channels other than those envisioned by the Group. Even so, if the Group itself is pursued social responsibility and the content and speed of response are insufficient, it will adversely affect the Group's social credibility and reputation, resulting in a decrease in sales, etc. May affect the performance of. However, if a large-scale earthquake that exceeds expectations causes great damage and the operation must be interrupted, it may have a significant impact on the Group's business performance and financial condition. In the wake of disasters such as the Great East Japan Earthquake and the Kumamoto Earthquake, the following various risks that were not previously assumed have become apparent. (3) Dependence on a specific supplier In order to procure higher quality and technology at a more competitive price, orders may have to be concentrated on a specific supplier. (4) Risks related to information systems Almost all operations of the Group depend on information systems, and the systems and networks are becoming more complex and sophisticated year by year.

(1) Financial status and operating results Global overall demand for the current consolidated fiscal year decreased by 1.5% from the previous year to 92.09 million units. Operating income was 318.2 billion yen, a decrease of 256.6 billion yen (44.6%) from the previous consolidated fiscal year. In addition, as a result of a decrease of 38.3 billion yen due to the conversion difference related to cash and cash equivalents and an increase of 1.1 billion yen due to the change in the scope of consolidation, the balance of cash and cash equivalents at the end of the current consolidated fiscal year was the end of the previous consolidated fiscal year. It increased by 153.1 billion yen (12.7%) to 1,359.1 billion yen. b. Order status Since the Group's build-to-order manufacturing is very small, the description of the order status is omitted. (2) Contents of analysis / examination regarding the status of business performance from the perspective of management The content of analysis / examination regarding the status of business performance of the Group from the perspective of management is as follows, and is based on the consolidated financial statements in principle. It is an analysis. The important accounting policies adopted in the Group's consolidated financial statements are described in "Basic matters for preparing consolidated financial statements" in the fifth [Accounting Status] consolidated financial statements. We believe that important accounting policies will have a significant impact on the judgment of important estimates in the consolidated financial statements. In the future, if a customer's financial condition deteriorates and their solvency declines, additional provisions may be recorded or bad debt losses may occur. It decreased by 256.6 billion yen (44.6%) from the operating income of the previous consolidated fiscal year. In the automobile business, sales (including internal sales between segments) were 10,584.1 billion yen, a decrease of 443.8 billion yen (4.0%) from the previous consolidated fiscal year. The main factors behind the decline in profits were a decrease in unit sales and an increase in development costs, although there was an increase in profits due to a reduction in purchasing costs. Operating income was 72.1 billion yen, a decrease of 128 billion yen (64.0%) from the previous consolidated fiscal year. c. Europe European market overall demand increased 0.3% year-on-year to 20.03 million units, but the Group's sales volume in the European market excluding Russia decreased 17.8% year-on-year to 530,000 units due to the impact of environmental regulations. The number of vehicles was 6,000, and the market share decreased by 0.6 points from the previous year to 3.0%. Sales in the Latin American market were strong, rising 8.1% year-on-year to 225,000 units, and sales in African markets such as South Africa increased 6.1% year-on-year to 101,000 units. Investing activities Expenditures from investing activities were 1,133.5 billion yen, a decrease of 14.2 billion yen from 1,147.7 billion yen in the previous consolidated fiscal year. This was mainly due to a decrease in income from the issuance of corporate bonds. The Group's financial policy is to secure appropriate funds, maintain optimal liquidity and maintain a sound balance sheet in order to invest in R & D activities, capital investment and financial business.

['vc turbo',' qx50','US','Altima',' q50','Japan','Murano',' q60','Nissan Days','ev Ecosystem','Nissan Energy', 'Namie Town, Fukushima Prefecture','Nissan Leaf',' Europe',' UK',' jncap',' us-ncap',' Pathfinder',' qx60','Kix',' tsp','Euro ncap' ',' Serena','Compression ratio engine',' Infinity new model',' vc turbo'engine',' 10 best engines','wards 10 best engines)',' Variable compression ratio',' Multi-link',' Compression ratio','Moldable ultra-high-tensile material','Skyline','Ultra-high-tensile material','Power system','Charging','World's first mass production type',' (UK)','Top safety pick' ,'led headlights','European new car assessment program','automatic driving','professional pilot','extrail','Rogue','Yokohama, Kanagawa','Serena e-power','Kashkai' ,'easy ride','Minato Mirai district','nissan move','Research for advanced technology']

The Group's R & D system and activity results are as follows. In the United States and Europe, Nissan North America in the United States, Nissan Mexico in Mexico, Nissan Motor Manufacturing UK in the United Kingdom, and Nissan Motor Iberica in Spain are engaged in the design and design development of some models. Renault, Mitsubishi Motors Corporation and the Company will share the development of next-generation technologies, platforms and powertrains with the aim of further streamlining management resources through the medium-term plan Alliance 2022 announced in September 2017. I'm accelerating. As of March 2019, the cumulative global sales of the "Nissan Leaf" exceeded 400,000 units, and the entire electric vehicle including the "e-NV200", "Sylphy Zero Emission", Venusia "e30", and Dongfeng brand Global cumulative sales exceeded 510,000 units. In 2013, the world's first 1.2GPa class high formability ultra-high ten material that can achieve both high strength and high formability was adopted for Infiniti "Q50" ("Skyline" in Japan), "Murano", Infiniti "Q60", etc. Expanded adoption to.・ Nissan Energy Supply: Providing various charging solutions for a safe and convenient EV life ・ Nissan Energy Share: Providing new value by "sharing" the power stored in the battery of an electric vehicle with a house. In terms of safety, we aimed to halve the number of fatalities related to Nissan vehicles compared to 1995 by 2015, and achieved this in Japan, the United States, and Europe (UK). In the United States, the "Pathfinder" and Infiniti "QX60" received the highest five-star rating in the US New Car Assessment Program (US-NCAP). In addition, we have announced plans to install "ProPilot" in 20 models and launch it in 20 markets by Reiwa 4th year, and the number of vehicles equipped with "ProPilot" will be sold by Reiwa 4th year. It is expected to reach 1 million units a year. At the same time, we are also working on mobility services for the future. * 1: At the time of release. The "Serena e-POWER" is 26.2km / L (Japanese standard) * 2: Production vehicles after August 2018.