Financial Overview

(in millions of JPY)

	FY ended Mar. 31, 2012	FY ended Mar. 31, 2011	Rate of Change (%)	Factors
Overall
Sales	733,192	710,431	3.2	1)
Operating income	44,417	43,524	2.1	2)
Ordinary income	42,004	38,572	8.9
Current net income	28,514	26,110	9.2
Automotive Business Division
Sales	444,585	424,157	4.8	3)
Operating income	22,637	26,898	(15.9)

Factors
1)
-During the first half of the fiscal year, in spite of the Great East Japan Earthquake, performance improved compared to the same period a year earlier, supported by the quick economic recovery that occurred after the Earthquake and the expanding economies in emerging markets, mainly China and the ASEAN Region. However, in the second half of the year, performance stagnated due to the horrendous impact that the flooding in Thailand had on business and due to the unstable financial situation in Europe.

2)
-The Company posted an extraordinary loss of 744 million yen from losses on securities purchased for investment purposes, deducting taxes and gains on minority interests in shares of stock that were sold.

3)
- The Company temporarily suffered a setback in business due to the Great East Japan Earthquake and flooding in Thailand. However, performance overall improved year-on-year due to greater sales of both automotive bearings and parts.
-Performance in Japan improved year-on-year due to the rapid recovery in auto-production that occurred after the Great East Japan Earthquake.
-In the U.S.A., the Company's business experienced a temporary setback due to the Great East Japan Earthquake. Nevertheless, performance as a whole improved year-on-year due to the continued, but slow, recovery in the economy; and also due to the greater volume of power-steering systems that the Company sold.
-Even though the economy in Europe clearly was in a slowdown, the Company was able to sell a greater volume of products, mainly hub-unit bearings.
-In Asia, performance still improved year-on-year, even though the pace of economic growth in China was slowing and the flooding in Thailand had disrupted operations. Sales of power-steering systems remained strong, increasing year-on-year.
-Productivity in both Japan and China increased year-on-year.

Business Plan

-The Company, Japan will raise the ratio of local production in Europe, as the Euro keeps weakening against the Japanese yen. It plans to improve efficiency in producing bearings for automobiles and industrial machineries at its local plants, reduce imports from Japan and other countries and promote replacement to local products. By thus raising the local supply ratio within Europe, NSK plans to enhance resistance to exchange rate fluctuation and increase its earning capacity. Currently 50% of is sales in Europe is from its products manufactured in Europe and the rest is from imports, mainly from Japan. (From an article in the Nikkan Jidosha Shimbun on November 25, 2011)

Acquisition

-The Company announced on February 3 that it will absorb "NSK Precision Co., Ltd," its wholly-owned subsidiary that manufactures and sells precision machinery and products, effective July 1, 2012.(From an article in the Nikkan Jidosha Shimbun on February 6, 2012)

-The Company announced that it increased its capital stake in Indian joint venture NSK-ABC Bearings Limited (NABI), which manufactures and sells automotive bearings, by 1,590 million Indian rupees (approximately 2.4 billion yen) on January 12, 2012. As a result, NABI's capital amounted to 3.8 billion rupees (about 7.1 billion yen), 96.7% of which is owned by NSK and the remaining 3.3% is owned by ABC Bearings Limited. After capital increase, NABI qualifies as a specified subsidiary of NSK. (From a press release on January 18, 2012)

>>>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	10,373	10,515	8,794
Automotive Business Division	6,455	6,497	4,860

R&D Structure

-In order to respond quickly and flexibly to the dynamically changing global business environment, the Company organized its R&D structure based on 14 technical centers worldwide, positioning its centers in Japan as the core centers for R&D activities. In all, the Company has six centers in Japan, two in The Americas, three in Europe, and three in Asia.

Major Achievements

Tough carrier the new series
-The Company announced on March 27, 2012 that it will add a new series with higher propulsion performance to its single-axis actuator "ToughcarrierTM" for applications in manufacturing equipment for automobiles and semiconductors. The new series, which is designed for longer life and higher speed revolutions, will be released in July. With a widened shaft diameter of ball screws, optimal designing of screws and bearings, as well as a change in the ball screw rolling pattern, the feeding portion of the new product has achieved longer life and high revolutions. NSK is aiming to generate one billion yen in sales from the Toughcarrier series in 2014. (From an article in the Nikkan Jidosha Shimbun on March 29, 2012)

Compact tight sealed hub unit bearing
-The Company announced on January 17, 2012 that it has developed a compact tight sealed hub unit bearing that features high reliability and reduced friction loss. Use of a metallic cap on the inner seal, which is designed to prevent dirty water or dust from entering the hub unit bearing, has reduced friction by about one- fourth, while maintaining excellent tight sealing. The new bearing has also increased magnetic force of the magnetic encoder for a wheel speed sensor used by ABS and ESC devices. (From an article in the Nikkan Jidosha Shimbun on January 18, 2012)

EPS integrated with a steering angle sensor for ESCs
-The Company has developed a column-type electric power steering (EPS) integrated with a steering angle sensor for electronic stability control systems (ESCs), which will be made compulsory on vehicles sold in Japan. The company is aiming to commercialize the product as early as 2014 or 2015. Installation of an ESC system, an advanced safety system, will impose an additional cost burden on automakers. The company is intending to propose the new EPS technology to automakers by highlighting that sharing the wiring system and other components between the ESC and EPS systems will help them minimize cost. (From an article in the Nikkan Jidosha Shimbun on January 7, 2012)

Low-torque tappet roller bearing with a long service life
-The Company announced on December 19, 2011 that it has developed a low-torque tappet roller bearing with a long service life for automotive engines. Introduction of a special heat treatment process has extended the bearing life, which made downsizing and weight reduction of the product possible. A smaller bearing contributes to lowering the torque loss, leading to enhanced fuel efficiency. NSK has already begun mass-producing the new bearing for a new vehicle coming to the market next spring, aiming to generate 1.5 billion yen in sales from the product in 2016. The company says, "Although little attention had been given to components used around the engine for upgrading fuel economy, requirements for making improvements in the area have been increasing significantly over the years. We expect our new tappet roller bearing will not only be used in vehicles with smaller engines, but also in vehicles powered by variable valve timing engines requiring smaller bearings because of their complex structure." NSK is set to vigorously propose the bearing to automakers to push up its sales. (From an article in the Nikkan Jidosha Shimbun on December 20, 2011)

Toroidal variator-type, CVT for front-wheel-drive vehicles
-The Company announced on November 28, 2011 that it has developed the world's first toroidal variator-type, continuously variable transmission (CVT) for front-wheel-drive vehicles. The company made the existing toroidal CVT used in rear-wheel-drive vehicles smaller and lighter, which allowed for its installation in front-wheel-drive vehicles. The new product also offers improved transmission efficiency, as well as superior fuel economy exceeding that of multiple-speed automatic transmissions and belt-driven CVTs. (From an article in the Nikkan Jidosha Shimbun on November 29, 2011)

Long-life ball bearing
-The Company has developed a super long-life ball bearing (EBR) for transmissions, which, by using the strengthened ball as the rolling element, has achieved a service life of two to three times as long as its previous products and reduced torque loss. As a result of the long-life service, downsizing and weight reduction of the bearing has been made possible, which should contribute to fuel efficiency of vehicles. NSK plans to promote the new EBR aggressively, targeting automakers at home and abroad in order to achieve 3.5 billion yen sales in 2015. (From an article in the Nikkan Jidosha Shimbun on November 22, 2011)

New low-friction ball screw
-The Company announced that it has developed a new low-friction ball screw and that the new screw has been selected for the electric controlled brake system by Hitachi Automotive Systems. The electric controlled brake can optimize a ratio between an energy regenerative brake and a normal friction brake to assure control power and increase efficiency in energy regeneration. .NSK succeeded in hollowing and downsizing a ball screw for this brake. It aims to generate 2 billion yen in sales in 2015. (From a press release on November 2, 2011)

-The Company announced on October 25, 2011 development of a low-friction ball screw for use in a regenerative braking system on hybrid and electric vehicles (HVs and EVs). The ball screw has already been used in the electric control brake supplied by Hitachi Automotive Systems to Nissan for its "Fuga Hybrid" that was launched last November and the "Leaf" EV launched last December. NSK will make further efforts to develop ball screws to meet increasing needs for smaller, lighter and electrified brake systems. It is aiming to achieve 2 billion yen in sales from this sector in 2015. (From an article in the Nikkan Jidosha Shimbun on October 26, 2011)

Low friction high reliability hub unit bearing
-The Company has developed a "low friction high reliability hub unit bearing," which has reduced friction and increased stability by use of new grease for lubricant. NSK has developed grease that is low in viscosity at normal temperatures and high in viscosity at high temperatures. The new grease helps decrease friction of a hub unit bearing by 25-30 percent and prolong rolling contact fatigue life compared with conventional products. NSK is aiming to generate 4 billion yen in sales in 2015 by this new product contributing to cutting down on fuel consumption of automobiles. (From an article in the Nikkan Jidosha Shimbun on September 30, 2011)

New thrust needle bearing for automatic transmissions
-The Company developed a new thrust needle bearing for automatic transmissions and started making proposals to transmission manufacturers. The needle bearing has a function to control the fluid flow in the bearing, making it possible to increase the volume of oil flow by up to 50 percent from the current level. This technology contributes to enhancing transmission efficiency and product reliability. In addition, integrating the bearing unit such as a needle roller, race, and cage makes for its easier mounting to the automatic transmission system, which leads to improved productivity. The company will step up marketing to automatic transmission manufacturers at home and abroad, aiming to achieve 1 billion yen in yearly sales of the new bearing by 2016. (From an article in the Nikkan Jidosha Shimbun on September 22, 2011)

Silent long-life roller bearing
-The Company developed a silent long-life roller bearing, which contributes to increasing quietness in the vehicle cabin, and will begin to present the product for electric motors in automobiles. Optimal interior designing has improved lubrication performance and serenity. Newly developed grease maintains quietness for a long time even under high temperatures. Heat and corrosion resistance performance has also improved, and noise caused by inadequate lubrication also has been cut by half compared with previous products. NSK, in anticipation of growing needs for securing quietness in the cabin, as the number of electric motors increases, expects to generate 2 billion yen in sales from the new bearing in 2015. (From an article in the Nikkan Jidosha Shimbun on August 30, 2011)

Rotational positioning device called Megapositioner
-The Company announced that it has developed a rotational positioning device called Megapositioner. The technology, which uses a mega torque motor and a backlash-free precision decelerator, allows high-speed, accurate positioning of products, which have an inertia moment of up to 700kg/m2. It achieves a high accuracy level of plus/minus 5 seconds in continuous operation, reducing the margin of errors to less than one tenth of existing positioning devices. NSK intends to propose the new technology to automakers to help them optimize the positioning of vehicle body frames on their welding lines. The company looks to generate 1 billion yen a year from the business by fiscal year 2014. (From an article in the Nikkan Jidosha Shimbun on July 8, 2011)

Large-bore ball bearing for the hybrid vehicle motor application
-The Company announced on July 5, 2011 that it has developed a large-bore ball bearing with improved durability for the hybrid vehicle motor application. The new bearing with an outer diameter of 190 millimeters can withstand a high rotational frequency of more than 10,000 per minute. Bearings with a larger bore rotate in high speed, imposing increased centrifugal force on the bearing retainer. Ensuring enough durability for the retainer to tolerate such high rotational frequency was regarded difficult to realize. NSK's engineers, however, have overcome the challenge by developing a plastic retainer made from carbon fiber reinforced composite using the PEEK resin, a high performance material employed in the aerospace industry. Introduction of the new material has raised the intensity of the retainer by 2.5 times compared with conventional technology. The new bearing product was chosen by General Motors for the Chevrolet Volt, an electric-powered model with an engine to provide an extended cruising range. Use of the large-bore bearing allowed the U.S. automaker to optimize the position of the planetary gear and the clutch unit, which contributed to reducing the overall width of the drive unit. NSK will explore new business opportunities by underlining such advantages to hybrid vehicle manufacturers. It is expecting its sales in the sector to increase by 3.5 billion yen from the current level by 2015. (From an article in the Nikkan Jidosha Shimbun on July 6, 2011)

Ball bearing for the belt-type Continuously Variable Transmission
-The Company announced on June 29, 2011 that it has developed a ball bearing for the belt-type Continuously Variable Transmission (CVT), which features 2.5 times higher durability than the conventional product and improved fuel efficiency with lubricant agitation resistance reduced by up to 30 percent. NSK plans to increase sales of bearings for the variable speed pulley by more than 2 billion yen from the current level in 2015 by making proposals of the new product aggressively to automakers and transmission suppliers. The product has been installed first for the CVT on the Toyota Vitz subcompact that was completely redesigned at the end of last year. (From an article in the Nikkan Jidosha Shimbun on June 30, 2011)

Needle roller bearing that reduces noises
-The Company announced on June 22, 2011 development of the needle roller bearing that reduces noises to one third of the previous products for automotive electric components. It has been put into practical application in order to improve the noise level of EV and HV, whose accessories' noises tend to be more noticeable as there is no engine sound. By revising the method to process needle rollers, circularity of the part frequently subjected to a load has been improved to decrease noises. In addition to EV and HV, NSK plans to promote this new needle roller bearing for luxury cars, for which quietness is a significant feature, and aims to achieve 200 million yen sales in 2015. (From an article in the Nikkan Jidosha Shimbun on June 23, 2011)

New technology to manufacture hub unit bearings
-The Company developed a new technology to manufacture hub unit bearings, which contributes to reducing the product weight and cutting down on energy required in the production process. The company's engineers achieved the breakthrough by manufacturing hub shafts, the major components of hub bearings, through a cold-forging method for the first time in the industry instead of the conventionally used hot-forging technique. Switching to cold forging achieves a 5 percent reduction in product weight, while using 27 percent less energy for heating in the manufacturing process. Although the cold-forging technology can produce high-intensity products, shifting from hot forging was considered unfeasible, given a high cost required to install an 8,000-ton stamping machine usually needed to manufacture high-strength products at normal temperatures. NSK, however, developed a new die, which enabled use of a 2,000-ton stamping machine originally designed for hot forging in the cold-forging line. This made it possible to hold down the cost of the new production process equal to or less than the current level. The new hub unit bearings, which are suitable for compact vehicles, are initially featured on the new Daihatsu Move. NSK will propose the technology, targeting low-priced vehicles that are expected to win growing demand in emerging markets. The company is looking to expand sales of hub bearings to 3 billion yen by 2015. (From an article in the Nikkan Jidosha Shimbun on April 15, 2011)

Capital Expenditure

(in millions of JPY)

	FY ended Mar. 31, 2012	FY ended Mar. 31, 2011	FY ended Mar. 31, 2010
Overall	54,619	41,294	21,818
Automotive Business Division	29,892	21,099	11,218

Automotive Business Division

Facility Location	Targets of Investments
	Small-sized Tapered Roller Bearings	Needle Bearings	Hub-unit Bearings	Power -Steering Systems
Japan	○	○	-	○
China	-	○	○	○
USA	○	-	-	○
India	-	-	○	-
Brazil	-	-	○	-

-The Company held on October 21, 2011 a groundbreaking ceremony of its new plant in Hefei, Anhui Province, in China. The new plant is slated to go into operation in August 2012 for manufacture and sales of automotive and industrial machinery bearings. It will be the company's 12th facility in China. (From an article in the Nikkan Jidosha Shimbun on October 24, 2011)

-The Company announced on June 7, 2011 that it will construct a new plant for production of automobile and industrial machinery bearings in Hefei, Anhui Province with the aim of increasing supply capacity in response to growing demand in the Chinese market. The new plant, in which NSK will invest about $150 million (approx. 12 billion yen), will get into operation in August next year. Since NSK set up a local subsidiary near Shanghai in 1995 to produce bearings, the company has expanded production of automobile and industrial machinery bearings to 11 plants. Demand for bearings, particularly for the automobile and industrial machinery industries, is expanding rapidly in line with a continuing growth of the Chinese economy. Against this backdrop, NSK will set up a new production facility in the inland area to enhance its supply capability. (From an article in the Nikkan Jidosha Shimbun on June 8, 2011)

-The Company will invest approx. 40 billion yen in facilities in the fiscal year ending March 31, 2012, either equaling or surpassing the previous fiscal year's amount, the company revealed at the financial results briefing held on March 18 at its headquarters in Shinagawa-ku, Tokyo. In the previous fiscal year, it spent 38.7 billion yen in facilities. NSK said that it has not yet forecasted sales and earnings for this fiscal year, as recovery of automobile production from the Great East Japan Earthquake remains unclear. The company, however, will continue the normal level of capital spending since it has decided that construction of production operations for larger output should be necessary for EPS, expected of growth in Southeast Asia and emerging nation, as well as for bearings, whose demand should certainly increase for industrial machineries. (From an article in the Nikkan Jidosha Shimbun on May 21, 2011)

-The Company, in order to raise the ratio of production that it performs outside Japan, continued to invest in facilities and equipment mainly in developing countries, particularly in China. By line of business, the Company is planning to invest slightly less than it did the year before in the industrial-machinery business; and about the same amount as it did the year before in the automotive parts business. In total, the Company has earmarked 48.6 billion yen for capital investments, which will be used to install new, major items of equipment.

Planned Capital Investments for the Automotive Parts Related Business

(As of Mar. 31, 2012)

Company Office (Location)	Equipment to be installed	Planned investment (million in JPY)	Start	Complete	Purpose
NSK Ltd. Ohtsu Plant (Shiga Pref., Japan)	Manufacturing facilities for automotive bearings and ball bearings for general use	1,167	Apr. 2011	Mar. 2013	Upgrading production infrastructure and streamlining operations
NSK Ltd. Ishibe Plant (Shiga Pref., Japan)	Manufacturing facilities for automotive bearings	2,111	Apr. 2011	Mar. 2013	Upgrading production infrastructure and streamlining operations
NSK Ltd. Saitama Plant (Saitama Pref., Japan)	Manufacturing facilities for automotive bearings	3,187	Apr. 2011	Mar. 2013	Upgrading production infrastructure and streamlining operations
NSK Steering Systems (Gunma Pref., Japan)	Manufacturing facilities for steering systems	5,451	Apr. 2011	Mar. 2013	Upgrading production infrastructure and streamlining operations
NSK Needle Bearing Co., Ltd. (Gunma Pref., Japan)	Manufacturing facilities for needle bearings	2,746	Apr. 2011	Mar. 2013	Upgrading production infrastructure and streamlining operations
NSK Corporation (Iowa, USA)	Manufacturing facilities for automotive bearings	2,413	Apr. 2011	Mar. 2013	Reorganizing production and streamlining operations
NSK Steeling Systems America. Inc. (Vermont, USA)	Manufacturing facilities for steering systems	2,136	Apr. 2011	Mar. 2013	Increasing production capacity
NSK Brazil Ltda. (Suzano, Brazil)	Manufacturing facilities for automotive bearings and ball bearings for general use	942	Apr. 2011	Mar. 2013	Upgrading production infrastructure and streamlining operations
NSK Bearings Europe Ltd. (Durham, UK)	Manufacturing facilities for automotive bearings and ball bearings for general use	2,708	Apr. 2011	Mar. 2013	Upgrading production infrastructure and streamlining operations
NSK Steering Systems Europe (Polska) Sp.Zo.o (Walbrzych, Poland)	Manufacturing facilities for steering systems	1,312	Apr. 2011	Mar. 2013	Increasing production capacity
NSK Bearings Manufacturing (Thailand) Co., Ltd. (Chonburi, Thailand)	Manufacturing facilities for automotive bearings	1,339	Apr. 2011	Mar. 2013	Increasing production capacity and streamlining operations
Siam NSK Steering Systems Co., Ltd. (Chachoengsao, Thailand)	Manufacturing facilities for steering systems	783	Apr. 2011	Mar. 2013	Increasing production capacity
Kunshan NSK Co., Ltd. (Kunshan, China)	Manufacturing facilities for automotive bearings and ball bearings for general use	5,284	Apr. 2011	Mar. 2013	Increasing production capacity and streamlining operations
Changshu NSK Needle Bearing Co., Ltd. (Changshu, China)	Manufacturing facilities for needle bearings	2,427	Apr. 2011	Mar. 2013	Increasing production capacity and streamlining operations
Zhangjiagang NSK Precision Machinery Co., Ltd. (Zhangjiagang, China)	Manufacturing facilities for automotive bearings and ball bearings for general use	2,436	Apr. 2011	Mar. 2013	Increasing production capacity and streamlining operations
Suzhou NSK Bearings Co., Ltd. (Suzhou, China)	Manufacturing facilities for automotive bearings	942	Apr. 2011	Mar. 2013	Increasing production capacity and streamlining operations
NSK Steering Systems Dongguan Co., Ltd. (Dongguan China)	Manufacturing facilities for steering systems	2,150	Apr. 2011	Mar. 2013	Increasing production capacity
NSK-Wanda Electric Power Assisted Steering Systems Co.,Ltd. (Hangzhou, China)	Manufacturing facilities for steering systems	3,172	Apr. 2011	Mar. 2013	Increasing production capacity
NSK Hefei Co., Ltd. (Hefei, China)	Manufacturing facilities for automotive bearings	3,755	Apr. 2011	Mar. 2013	Increasing production capacity
NSK Korea Co., Ltd. (Changwon, Korea)	Manufacturing facilities for automotive bearings	3,491	Apr. 2011	Mar. 2013	Reorganizing production and streamlining operations
NSK-ABC Bearings Ltd. (TamilNadu, India)	Manufacturing facilities for automotive bearings	2,488	Apr. 2011	Mar. 2013	Increasing capacity
Rane NSK Steering Systems Ltd. (TamilNadu, India)	Manufacturing facilities for steering systems	1,009	Apr. 2011	Mar. 2013	Increasing capacity