Financial Overview

(in million of JPY)

	FY ended Mar. 31, 2013	FY ended Mar. 31, 2012	Rate of Change (%)	Factors
Overall
Sales	415,521	382,737	8.6	1)
Operating income	14,493	13,618	6.4	-
Ordinary income	17,050	13,499	26.3
Net income	(21,122)	11,937	-	-The Company recorded an extraordinary loss to set up product-warranty reserves in line with a product recalls at its customers.

Factors
1)
- Sales in Japan increased slightly year-on-year. Sales in the first half recovered from the decrease in production that was caused by the Great East Japan Earthquake during the previous fiscal year; however, vehicle demand fell in the second half after eco-car sales incentives ended.
- Sales increased in the U.S.A. Year-on-year increases in new-vehicle production levels grew by two-digit figures, as in the last fiscal year.
-Sales in Europe fell by a small margin. Even though new-vehicles production levels decreased within Europe, the Company's sales were supported by a greater volume of products sold in Russia after its plant in the country launched commercial production.

Acquisitions

- The Company has acquired Germany-based SDI Molan GmbH & Co. KG, effective November 30, 2012. SDI Molan manufactures pyro-electric initiators and micro gas generators for passive safety systems, such as airbags and seat belt pretensioners and others. (From a press release on November 30, 2012)

Develoment of Manufacturing in Emerging Countries

Region or Country	Event	Date	Development in manufacturing
South America	Uruguay plant: Fully operational	2013	Production of airbags cushions
Asia	Indonesia plant: Fully operational	2012	Production of seat belts, airbags and steering wheels
Russia	Russia plant: Fully operational	2012	Production of seat belts, airbags and steering wheels
Germany	Acquisition of SDI Molan	Jan. 2013	Production of initiators for airbags, pretensioners for seat belts
Europe and USA	Acquisition of BAE subsidiaries	Mar. 2012	Production of seat belts for racing cars, and passenger safety equipment for military vehicles
Korea	Tie-up with Hyundai Mobis	Nov. 2011	Motorized seat belts technology alliance. Preparing to install on South Korean automobiles.

Awards

- The Company announced that Takata Automotive Electronics in Shanghai, China, was given Ford Motor Company's "Gold" World of Excellence Award for its restraints electronics. The Company has also being named General Motors Global Supplier of the Year for 2011. This is the second year in a row the Company received the GM award. (From a press release on June 21, 2012)

Outlook for FY ending Mar., 2014

(in millions of JPY)

	FY ending Mar. 31, 2014 (Forecast)	FY ending Mar. 31, 2013 (Actual Results)	Rate of Change (%)
Sales	460,000	415,521	10.7
Operating income	20,000	14,493	38.0
Ordinary income	19,000	17,050	11.4
Net income	13,000	(21,122)	-

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

R&D Expenditure

(in million of JPY)

	FY ended Mar. 31, 2013	FY ended Mar. 31, 2012	FY ended Mar. 31, 2011
Japan	3,140	5,032	3,924
Americas	6,991	6,576	5,567
Europe	7,461	5,721	6,121
Asia	1,916	1,297	859
Corporate	42	(366)	(414)
Overall	19,552	18,261	16,058
Ratio in Sales (%)	4.8	4.7	4.2

-R&D expenses for FY ending Mar. 31, 2014 are forecast to be 220 million yen, a 12.8% year-on-year increase, which would be the equivalent of 4.8% of total sales.

R&D Structure

-R&D centers are located in Japan (Shiga Pref.), North America (Detroit) and Europe (Berlin).

- The Company announced that it has established a new Global Engineering Service Center (GESC) at the L&T Technology Services, based in Chennai, India. The new center will enhance engineering research and development capabilities for next-generation occupant safety and protection systems for automobiles. The Company will work on the expansion and optimization projects for the GESC facility over the next five years. (From a press release on January 25, 2013)

-Product realization activity is being performed by each segment including Asia.

 

Introduction of a new servo sled track with pitch and pulse capabilities

-The Company announced that it held a ceremony for the completion of construction of the new No.3 Evaluation Building at its Echigawa Plant in Shiga Prefecture, Japan. The total floor area of the new facility is approximately 6,500 square meters. The facility is due to start operations in early May 2013 and will introduce a new servo sled track with pitch and pulse capabilities. The Company currently operates twelve crash simulation sleds worldwide (four in Japan, four in Germany, two in the U.S., and one each in China and South Korea), which are able to produce results mimicking an actual vehicle collision. This latest testing apparatus is capable of reproducing the lift of a vehicle's rear in the event of a frontal collision ("pitching"), and has already been introduced in Germany and the U.S., making it the third of its kind at the Company. (From a press release on February 4, 2013)

Product Development

Flexible Venting Technology (FVT) Airbags
-The Company announced that it has commercialized a new airbag system incorporating the Company's flexible venting technology (FVT). The new driver seat airbag has a vent hole cover on the exhaust vent located on the back side of the airbag. When the airbag is inflated and hits the occupant's body, the cover on the vent hole opens to discharge some gas, releasing excessive pressure in the airbag. The flexible venting technology can optimally absorb the impact according to the driver's physical frame. The world's first FVT airbag system, which meets the safety standards in the U.S., is already supplied to two U.S. automakers. The Company is poised to accelerate sales activities for the new product, underlining its simple design structure and cost-saving attribute. (From an article in the Nikkan Jidosha Shimbun on Mar. 7, 2013)

The World's first Front Center Airbags
- The Company, together with GM, an OEM based in the U.S.A., jointly developed and commercialized the world's first front center airbags. GM launched this new product on several 2013 model vehicles. From the passenger's perspective, there are two possible types of side collisions. One occurs close to the occupant (the near side). The other happens on the opposite side from the occupant (the far side). Current available devices consider only near side scenarios. However, to better protect passengers from collisions from both sides, the Company's front center airbags inflate between the left and right seats. The Company was awarded the 2013 Best New Technology Award by the Automotive Journalists Association of Canada (AJAC) for this new product.

Capital Expenditure

(in million of JPY)

	FY ended Mar. 31, 2013	FY ended Mar. 31, 2012	FY ended Mar. 31, 2011
Japan	3,447	3,406	1,529
Americas	7,572	6,329	6,132
Europe	6,448	6,069	4,465
Asia	3,116	3,618	3,584
Overall	20,584	19,422	15,712

-The Company invested in building a new plant in Thailand, which is increasingly becoming the automotive production center of the developing countries in Asia. It also invested to install new production lines and increase facilities in each region, creating a production structure capable of responding to growing demand in every region.

-The breakdown of capital-investment spending by some product sectors in FY ending Mar. 31, 2014 are planned as follows:

• Airbags: 25%
• Steering wheels: 23%
• Seat belts: 21%

Planned capital investments

(As of Mar. 31, 2013)

Plant Name (Location)	Equipment to be installed	Estimated amount of investment (in million JPY)	From	To
Takata India Private Limited (Chennai and Neemrana, India)	Equipment to produce and evaluate seat belts, airbags and steering systems	4,222	Jan. 2008	Mar. 2014
Takata-TOA Co., Ltd. (Bangkok, Thailand)	Equipment to produce steering systems	1,453	Jun. 2011	Apr. 2013