-FY2011 covers the period for nine months from April 1 through December 31, 2011, because the Company changed the month for ending the business year from March to December.

Financial Overview

(in millions of JPY)

	FY2010 (ended Dec. 2011)	FY2010 (ended Mar. 2011)	Rate of change (%)	Factor
Overall
Sales	465,133	519,742	-	-
Operating income	26,290	29,490	-	-
Ordinary income	20,717	23,356	-	-
Current net income	11,618	13,923	-	-
Tire Operations
Sales	379,220	413,372	-	-Sales of OEM tires were slow in Japan in the aftermath of the great earthquake. Sales of replacement tires, however, were strong in Japan. Overseas business was stable, especially in Europe, the Middle East, and Asia.
Operating income	23,365	24,952	-	-

Contracts

Toyota
- The Company announced that it has begun delivery of its S73 BluEarth tires developed based on its new eco tire BluEarth concept for installation as original equipment (OE) on Toyota's new compact hybrid car Aqua. (From a press release on December 27, 2011)
- The Company announced that its Advan dB tires (205/60R16) are installed as original equipment on the new Prius α hybrid released by Toyota Motor Corporation. (From an article in the Nikkan Jidosha Shimbun on June 11, 2011)

Daihatsu
- The Company announced announced that it has begun delivery of its BluEarth A34 tires as original equipment (OE) on Daihatsu's new light vehicle Mira e:S. (From a press release on November 1, 2011)

Mazda
- The Company announced that its fuel-efficient tire was chosen for installation on the partially remodeled Mazda Demio compact vehicle, which was released in June. (From an article in the Nikkan Jidosha Shimbun on August 25, 2011)

Daimler
- The Company announced that its ADVAN Sport V105 tires for high-powered cars have been selected as original equipment for Mercedes-Benz SLK-class two-seater roadster models produced by Daimler AG. (From a press release on May 30, 2011)
- The Company announced announced that its ADVAN Sport V105 tires for high-powered cars have been selected as original equipment for Mercedes-Benz CLS-class premium luxury 4-door coupe models produced by Daimler AG. (From a press release on May 30, 2011)
- The Company announced that its S. drive AS01 high-performance tire for overseas markets has been approved as original equipment for the Smart Fortwo produced by Daimler-Smart of Germany. (From an article in the Nikkan Jidosha Shimbun on July 25, 2011)

Business Plan

- In December 2011, the Company started to manufacture tires in Russia, becoming the first Japanese tire supplier to launch production in the country. The plant will initially have the capacity to manufacture 700,000 tires a year, which is expected to increase to 1.4 million tires eventually.  

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

Outlook for FY2011

(in millions of JPY)

	FY2012	FY2013	FY2014
Sales	5,750	5,950	6,300
Operating income	400	500	600

Tire Production Capacity (Number of tires)

(unit: ten thousand tires)

	FY2012	FY2013	FY2014
Japan
Mie （Truck&Bus, Light Truck）	590	590	590
Mishima （Passenger）	1,390	1,390	1,390
Shinshiro （Passenger）	1,410	1,410	1,410
Shinshiro Minami （Passenger）	280	280	280
Japan Total	3,670	3,670	3,670
Overseas
U.S.A （Passenger）	620	620	620
U.S.A （Truck&Bus）	58	60	60
Philippines （Passenger）	700	800	1,000
China （Passenger）	510	510	650
China （Truck&Bus）	34	34	34
Thailand （Passenger, Light Truck）	400	400	400
Thailand （Truck & Bus）	35	35	40
Russia	70	140	160
Overseas Total	2,427	2,599	2,964
Total	6,097	6,269	6,634

R&D Expenditure

(in millions of JPY)

	FY2011	FY2010	FY2009
Overall	9,307	12,747	13,280
Research Headquarters	948	1,316	1,517
Tire Operations	5,909	7,946	7,944

- The Company announced it will establish an R&D operation for tires in China as early as this summer.  This will be the company's first, full-scale R&D function outside Japan.  In addition to accelerating development of products targeting the China market, it aims to enhance the function to evaluate materials procurable in China so that it should raise the local content ratio.  The company plans to further increase its market shares in the fast-growing China market by pursuing localization of its development operation as well as its production and sales operations. (From an article in the Nikkan Jidosha Shimbun on April 25, 2011)

R&D Structure

facility	Location
RADIC (Research & Development Integrated Center)	Kanagawa, Japan
D-PARC (Daigo Proving-Ground and Research Center)	Ibaraki, Japan
T*MARY (Takasu Motoring and Researching Yard)	Hokkaido, Japan
Tire Test Center of Asia	Rayong, Thailand

Capital Investment

(in millions of JPY)

	FY2011	FY2010	FY2009
Overall	22,400	24,900	17,500
Tire business	19,500	22,200	14,800

-The Company invested 5.2 billion yen in upgrading its domestic production facilities, improving productivity, and raise its quality levels, as it releases new products, including large and high-performance tires.   

- Major investment activities outside Japan included a 4.3 billion yen project at L.L.C. Yokohama R.P.Z. in Russia to expand facilities to make tires for passenger vehicles and light-duty trucks.

Investments Outside Japan

- The Company will begin production of passenger car tires in the state of Lipetsk, Russia by the end of 2011, the first production of tires in Russia by Japanese tire makers. The company is investing about 14.8 billion yen, planning to build production capacity of one million tires in 2012. (From an article in the Nikkan Jidosha Shimbun on August 18, 2011)

- The Company announced that Yokohama Tire Philippines, Inc. (YTPI), a passenger tire manufacturing and sales subsidiary, held the groundbreaking ceremony for the construction of its new tire plant. In January this year, the company announced the plan to expand the annual production capacity of the YTPI by 2.4 times to 17 million tires from the current 7 million by 2017. The company will make an additional investment worthy of 50 billion yen by 2017 to expand the total plant area to 460,000 square meters and achieve a total employment of a 5,000 human workforce. (From a press release on May 30, 2011)

Planned Capital Investments (Tire business)

(As of Dec. 31, 2011)

Facility (Location)	Business	Expected Investment (millions of yen)	Start	Planned completion	Increased capacity after completion
The Company
Hiratsuka Plant (Kanagawa, Japan)	Manufacturing	3,641	Apr. 2011	Dec. 2012	-
Mie Plant (Mie, Japan)	Manufacturing	3,316	Apr. 2011	Dec. 2012	-
Mishima Plant (Shizuoka, Japan)	Manufacturing	2,740	Apr. 2011	Dec. 2012	-
Shinshiro Plant (Aichi, Japan)	Manufacturing	7,833	Apr. 2011	Dec. 2012	-
Onomichi Plant (Hiroshima, Japan)	Manufacturing	1,506	Apr. 2011	Dec. 2012	-
Yokohama Tire Manufacturing Thailand Headquarters and Plant (Rayong, Thailand)	Manufacturing and other business	4,604	Apr. 2011	Dec. 2012	-
L.L.C. Yokohama R.P.Z. Headquarters and Plant (Lipetsk, Russia)	Manufacturing and other business	13,650	Jul. 2009	Feb. 2012	1.4 million passenger car tires
Yokohama Tire Philippines, Inc. Clark Special Economic Zone, Philippines)	Manufacturing and other business	19,700	Feb. 2011	Dec. 2013	3.0 million passenger car tires