Financial Overview

(in millions of JPY)

	FY2010 (ended Mar. 2011)	FY2009	Rate of Change (%)	Factors
Overall
Sales	55,276	43,990	25.7	-
Operating income	7,012	1,974	255.2	-
Ordinary income	7,943	2,842	179.5	-
Current net income	4,646	1,682	176.2	-

Recent Developments Outside Japan

China
In May 2010, the Company announced its plan to establish a joint venture in Shandong Province, China, for manufacturing cylinder liners of automotive engines. A TPR affiliate in Korea, Y&T Power Tech., Inc., will form a company tentatively named as YTAL, jointly with ARN (Anhui province, China) in July. The joint venture is expected to achieve annual sales of one billion yen in 2012. Located at Rizhao, Shandong, YTAL will supply cylinder liners to Korean automakers in China. Its capital of USD 8 million will be held 80% by Y&T and 20% by ARN. (From an article in the Nikkan Jidosha Shimbun on May 17, 2010)

In August 2010, the Company announced that it has frozen its project to establish a new joint venture company in China. The company was planning to build a cylinder liner plant in Shandong Province through a joint investment with a Chinese auto parts supplier. Following the sharp depreciation of the Korean won, however, TPR has decided that it would be more advantageous to increase cylinder liner production at and export the products to China from Y&T Power Tech, its affiliate in Korea, than forming a new company. Y&T will set up an additional production line by October next year, aiming to raise its production capacity to 1.6 million units per month, an increase of 33 percent from the current volume. (From an article in the Nikkan Jidosha Shimbun on Aug. 5， 2010)

India
The Company said it has decided to include its subsidiary in India, TPR Autoparts Mfg. India Pvt. Ltd., in its consolidated financial statements starting with the first quarter of this financial year, because the subsidiary engaged in manufacture and sales of cylinder liners in India has enhanced its presence in the group. Established in March 2008, it is owned 99.27 percent by TPR and 0.73 percent by TPR's subsidiary, Teipi Industry Co., Ltd. (From an article in the Nikkan Jidosha Shimbun on August. 6, 2010)

>>>Financial Forecast for the Next Fiscal Year (Sales, Operating Income etc.)

R&D Expenditure

(in millions of JPY)

	FY2010	FY2009	FY2008
Overall	1,869	1,841	1,871

R&D Alliance

The Company announced its business alliance with Okaya Electric Industries Co., Ltd., a capacitor manufacturer, on the technology of electric double layer capacitors.  As part of its diversification, it will establish TOC Capacitor, a fifty-fifty joint venture company in Okaya, Nagano Pref. to develop technologies and products using electric double layer capacitors.  It will be capitalized at 100 million yen. The new company will aim to develop products utilizing technologies related to electricity storage and fast charging in about two years. (From an article in the Nikkan Jidosha Shimbun on March 29, 2011)

R&D Activities

Automotive product business
<Powertrain components>
Piston rings
-Development of super low friction rings, which are designed to improve power output and fuel economy.
-Development of thin, highly-functional oil rings, which are designed to improve durability.
-Creation of a production line that is designed to radically reduce the production costs of piston rings.
 
Cylinder liners
-Commercialization of liners for small engines. These liners are smaller in diameter, have super thin walls, are lightweight, and have superior heat-conducting properties, enabling them to respond to the needs for greater output and improved fuel consumption.
-Commercialization of low friction bore liners, which are designed to improve fuel efficiency.

Valve seats
-Commercialization of valve seat materials which are capable of responding to the need for alternative fuels. These materials are highly resistant to abrasion.

<Other than powertrain components>
Aluminum-based products
-Commercialization of a motor frame for EV motors by creating a new casting method and installing equipment.

Sintered mechanical parts
-Development of processing method that improves the accuracy and enhance the strength of shock absorber, and coupling components
 
Improvement in R&D infrastructure
-Improvement and expansion of facilities for evaluating the function of each part as well as the performance of each part when mounted on engines
-Building a simulation system
-Develop a support system to assist in developing designs (Piston rings)

Capital Investment

(in millions of JPY)

	FY2010	FY2009	FY2008
Overall	3,136	2,003	5,429
-Japan	1,482	-	-
-Asia	1,501	-	-
-North America	139	-	-
-Others	13	-	-
-Automotive related product business	-	1,973	5,191

-For the automotive product business, the Company made a capital investment focusing on increasing its production capacity for piston rings and cylinder liners in overseas emerging markets, and rationalizing operations to achieve cost reductions.

Planned Capital Investments (automotive components)

(As of Mar. 31, 2011)

Name/ Name of the business	Location	Type of facility and purpose	Planned investment (millions of JPY)	Planned construction start date	Planned completion	Increased capacity upon completion
Nagano factory	Okaya City, Nagano Pref.	Facilities for producing piston rings, conducting R&D activities, etc.	1,390	Apr. 2011	Mar. 2012	No impact on production capacity
Teipi Industries Co., Ltd.	Sagae City, Yamagata Pref.	Facilities for producing cylinder liners	590	Apr. 2011	Mar. 2012	No impact on production capacity
Anqing TP Goetze Liner Co.,Ltd.	Anhui Province, China	Facilities for producing cylinder liners	930	Jan. 2011	Dec. 2011	30%