Financial Overview

(in millions of JPY)

	FY ended Mar. 31, 2012	FY ended Mar. 31, 2011	Rate of change (%)	Factors
Overall
Sales	70,327	63,451	10.8	1)
Operating income	9,524	7,714	23.5	2)
Ordinary income	8,948	6,715	33.3
Current net income	5,436	8,123	(33.1)	3)
Automotive Bearings
Sales	41,084	37,567	9.4	4)
Operating income	6,192	5,242	18.1
Non-bearing automotive business
Sales	15,226	13,638	11.6	5)
Operation income	4,245	3,907	8.7

Factor
1)
-Although negative factors impacted the Company's business, such as the significant slowdown in demand in China, the decline in demand in Europe, and the huge drop in production volume in Thailand, the Company's overall performance on a worldwide basis improved year-on-year. This was possible due to the market recovery in the U.S.A. and the huge increase in demand seen in developing countries.
-In Japan, performance during the first half of the year was much lower compared to the same period a year earlier because of the impact that the Great East Japan Earthquake had on business. During the second half of the year, however, the Company quickly recovered due the revival in production by OEMs, the launch of new products, and higher consumer demand created after the eco-car sales incentive program was re-introduced.

2)
-Performance improved year-on-year due to the success of the Company's improved profit-structure and the increase in revenue generated by the Company's affiliates both in and outside Japan.

3)
-This was the result of posting adjusted corporate taxes, which resulted with the liquidation of the Company's U.S. subsidiary, in the previous fiscal year's ordinary net profit.

4)
-Outside Japan, sales particularly to non-Japanese OEMs such as those based in Europe increased year-on-year.
-In Japan, sales increased during the latter half of the year due to the recovery in auto production at OEMs, with the volume of new program business for trucks in particular increasing year-on-year.

5)
-In addition to greater sales volume of products destined for outside Japan, the Company experienced a recovery in business to Japanese auto-suppliers during the second half of the fiscal year.

Mid-term business plan

-The Company announced its new mid-term business plan called "Together to the Top" for the 5-year period through March 2018 (FY2017). Based on this plan, the company aims to obtain the world's largest share of the sliding bearing market in all categories. Its sales target for FY2017 is set at 111 billion yen, more than a 60 percent increase from this year's forecast of 69 billion yen, while its operating margin is expected to go over 15 percent. The company will work on establishing a stable production, sales and development structure worldwide, while highlighting its commitment to develop and sell environmentally friendly products. (From an article in the Nikkan Jidosha Shimbun on February 16, 2012)

New Company

-The Company announced on October 26, 2011 that Dyna Metal Co., Ltd. (Thailand), its consolidated subsidiary located in the Wellgrow Industrial Estate, Chachoengsao Province, will suspend operations from October 26 through 28 due to an expanding damage from the flooding. At present, there is neither flooding at the plant site, nor human casualties. (From an article in the Nikkan Jidosha Shimbun on October 27, 2011)

-The Company said on September 27,  2011 it will set up a subsidiary in Mexico to produce bearings for automobile engines in a bid to comply with customer needs and respond to growing demand in the North American region. A new company tentatively called Daido Metal Mexico S.A. de C.V. will be established in Acatlan de Juarez, Jalisco in January 2012. It will be capitalized at 100 million pesos, which will be entirely funded by the Daido group.(From an article in the Nikkan Jidosha Shimbun on September 28, 2011)

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

R&D Expenditure

(in millions of JPY)

	FY ended Mar. 31, 2012	FY ended Mar. 31, 2011	FY ended Mar. 31, 2010
Overall	1,214	1,128	1,069

R&D Structure

-R&D activities are conducted by three functions, namely the Central R&D Center, the Production Technology Department, and the Tribo Group's Main R&D Department.

-As of March 31, 2012, the Company had 76 researchers.

R&D Results

Copper-alloy bearing with a new, lead-free overlay
 The Company is aiming to develop a bismuth overlay and copper-alloy that achieves even greater performance in terms of complying with clean diesel-engines and European regulations on lead.

Successfully developed a bearing for racing cars
-The Company developed and is now delivering a superior level of bearing with enhanced durability and seize resistance that can handle ultra-high-speed revolutions used in F1 racing.

Developed a new PEEK material
-In conducting R&D activities on auto-parts and general industrial-use parts, the Company developed a bearing designed with PEEK materials, for which there is a great need mainly in Europe, further enhancing the performance.

Material for bearings used in shock-absorbers to further improve riding comfort
-The Company developed a bearing material that will be used to make lead-free, plastic bearings for shock absorbers that improve riding comfort in terms of steering stability and shock/vibration absorption.

Analysis to improve the frictional wear of slide bearings under dynamic loads
-In conducting analysis on the performance of slide bearings based on elastic fluid lubrication theory, the Company developed a program that simulates the behavior of abrasion advancement of slide-bearings under dynamic loads by adding an analytical program that creates models (scenarios) in which friction wear is generated from contact pressure.

Antifriction engine-bearings designed for idling-stop and hybrid mechanisms
-The Company developed surface layer and aluminum-alloy automotive engine-bearings that demonstrate superior performance. Compared to conventional bearings, the new bearings are highly durable, reducing frictional wear by one-third.

Capital Expenditure

(in millions of JPY)

	FY ended Mar. 31, 2012	FY ended Mar. 31, 2011	FY ended Mar. 31, 2010
Automotive Bearings	5,596	2,763	2,943
-Facilities specialized in processing	2,768	1,832	1,076
-Production facilities producing bimetal	1,861	589	1,190

Investments

Facility	Outlines
Automotive Bearings
-Facilities specialized in processing	-The Company made capital investments to reorganize its production structure in Japan, mainly investing in Daido Plain Bearings Co., Ltd. and NDC Co., Ltd. -At its consolidated subsidiaries outside Japan, the Company made capital investments to enhance their production capacity, focusing on its Asian facilities.
-Production facilities producing bimetal	-The Company supplies most of the bimetal used at its production facilities in Japan and overseas. To meet the growing needs for bimetal, the Company invested in facilities of its own to expand its production capacity as quickly as possible.

Planned Capital Investments (Bearing metal for automobiles business)

Name (Location)	Purpose of Equipment Installation	Estimated amount (in million JPY)	From	To	Capacity increase on completion
Maehara Plant (Aichi Pref., Japan)	Facility to produce middle-size half-bearings	250	Feb. 2011	Jun. 2012	About 70% increase in middle-size half-bearings production capacity
Bi-metal production plant (Aichi Pref., Japan)	Facility to produce bi-metals (materials used for bearings)	1,500	Jan. 2008	Oct. 2012	About 5% increase in bi-metal (bearing material) production capacity
		2,300	Oct. 2008	Jun. 2012	About 8% increase in bi-metal (bearing material) production capacity
		295	Oct. 2008	Apr. 2012	About 5% increase in bi-metal (bearing material) production capacity
		269	Jul. 2010	Jul. 2012	About 8% increase in bi-metal (bearing material) production capacity
DYNA METAL CO., LTD. (Chachoengsao, Thailand)	Facility to produce half-bearings	270	May. 2011	Apr. 2012	About 17% increase in half-bearings production capacity
	Plant facility	365	Jan. 2011	Apr. 2012	Build 6,955m2 more of additional production space
Daido Precision Metal (Suzhou) Co., Ltd. (Jiangsu, China)	Plant facility	283	Aug. 2011	Jul. 2012	Build 6,600m2 more of additional production space
Maehara Plant (Aichi Pref., Japan)	Facility to produce middle-size half-bearings	425	Oct. 2011	Sep. 2012	About 260% increase in middle-size half-bearings production capacity
	Plant facility	381	Dec. 2011	Aug. 2012	-
	Facility to produce middle-size half-bearings	300	Jan. 2012	Oct. 2012	About 41% increase in middle-size half-bearings production capacity
	Facility to produce middle-size half-bearings	200	Jan. 2012	Oct. 2012	About 77% increase in middle-size half-bearings production capacity
Dong Sung Metal Co. Ltd. (Chungcheongbuk-do, Korea)	Facility to produce half-bearings	143	Sep. 2011	Aug. 2012	About 12% increase in half-bearings production capacity
Inuyama Plant (Aichi Pref., Japan)	Facility to produce half-bearings	291	Apr. 2012	Dec. 2012	About 147% increase in half-bearings production capacity
	Facility to produce half-bearings	143	May. 2012	Nov. 2012	About 30% increase in half-bearings production capacity
Maehara Plant (Aichi Pref., Japan)	Plant facility	250	Jun. 2012	Oct. 2012	Build 1,500m2 more of additional production space