Financial Overview

(in millions of JPY)

	FY ended Dec. 31, 2012*	FY ended Mar. 31, 2012	Remarks
Overall
Sales	291,110	320,569	-
Operating income	15,650	12,893	-
Ordinary income	13,645	10,754	-
Net income	13,218	6,704	-
Tire Business
Sales	228,729	241,693	1)
Operating income	13,014	10,325	-
DiverTech Business
Sales	62,321	78,795	2)
Operating income	2,228	2,073	-

*Due to changes made to the Company's accounting term, FY2012 covers a 9-month period from April 1, 2012 through December 31, 2012 in the Group's financial statements for the domestic business, while covering a 12-month period from January 1, 2012 through December 31, 2012 in those for the overseas business.

Remarks
1) Tire Business
-Production volume recovered from last year, when production significantly slowed in the aftermath of the Great East Japan Earthquake.
-Sales of vehicles equipped with the Company's products were strong.

2) DiverTech Business
-Sales of anti-vibration rubber and seat cushions recovered from last year, when sales were impacted by the Great East Japan Earthquake and a massive flooding in Thailand. Overall sales at the DiverTech Division, however, stood at the same level as the previous year due to the following reasons:

• Decreased vehicle production at Japanese automakers in China
• Falling demand for vehicles in Japan after the termination of the eco-car incentive program
  

Joint Venture

-The Company has announced that it has agreed to establish a joint venture company in Foshan, Guangdong province, China to manufacture and distribute urethane seat cushions for transportation machinery such as automobiles, with Guangdong TGPM Automotive Industry Group Co., Ltd. of China. The new company, Toyo TGPM Automotive Parts Foshan Co., Ltd., will be capitalized at 50 million RMB (approximately 600 million yen), 60% of which will be provided by Toyo Tire & Rubber and the remaining 40% provided by TGPM. Production is scheduled to begin in April 2013. The annual sales for 2017 are estimated to be 1.3 billion yen. (From a press release on January 27, 2012)

Recent Development Outside Japan

<China>
-The Company will manufacture passenger and light truck tires for the U.S. and Japanese markets at its new Chinese plant, which just began its full scale production in August 2012. The plant was opened initially as a manufacturing site dedicated to the Chinese market. However, tire dealers in China are recently hesitant to purchase the company's tires because of escalating territorial disputes between Japan and China. The Company is poised to maintain the operational level of the plant by producing tires for sales outside China. The plant, which has a full capacity of 160,000 tires per month, is currently producing only from 100,000 to 120,000 tires per month. By increasing production for overseas markets, the company aims to keep the plant's operating rate at 80-90 percent. The volume of export tires is expected to account for about half of the total production of the plant for the time being. (From an article in the Nikkan Jidosha Shimbun on Nov. 16, 2012)     

-The Company announced that it will release the Proxes C100 high-performance tires designed exclusively for sedans and coupes marketed in China. The tires will be produced at Toyo Tire (Zhangjiagang) Co., Ltd. in Zhangjiagang, Jiangsu Province and sold in China, starting August, 2012. While locally produced low-price tires now have a large share in the replacement tire market in China, an increasing number of consumers are beginning to opt for high quality tires as the economy progresses. The Company is poised to supply high-quality and advanced tires made at its Chinese facilities to meet new demand of these customers. The Proxes C100 tires offer a high level of noise reduction and riding comfort to medium- to luxury-class vehicles with their asymmetric tread patterns and optimized structural design. In addition, they help achieve better steering responses when changing lanes and also enhance driving safety by shortening the braking distance. (From an article in the Nikkan Jidosha Shimbun on Jun. 16, 2012)

<Thailand>
-The Company will start sales of anti-vibration rubber for automobiles in Thailand in November 2012. By establishing a stable supply structure in the country, the Company aims to expand its automotive components business in Asia where Japanese automakers are increasing their production volume. Toyo Tire's products will be sold through Toyo Rubber Chemical Products (Thailand) Limited, its existing local subsidiary that has been engaged in production and sales of office automation equipment parts. The Company is poised to increase its presence in the automotive industry by strengthening sales in the fast growing market. (From an article in the Nikkan Jidosha Shimbun on Jun. 29, 2012)

<Global introduction of its fuel efficient tires>
-The Company announced that it will release its Nanoenergy fuel efficient tires in the European market in October as a first step of its global introduction of the brand. The Nanoenergy tires were designed based on the company's Nano Balance Technology, a systematic collaboration of nano-level element technologies for material design. In Europe, a compulsory tire labeling system is due to be introduced on November 1, in which information on the tire's rolling resistance, wet grip performance and noise levels are required to be provided based on set criteria. Two Nanoenergy series to be sold in Europe are both ranked high in the European labeling system. (From an article in the Nikkan Jidosha Shimbun on Jun. 19, 2012)

Contracts

-In 2012, the Company launched supplying its tires for Toyota "Crown" and Nissan "Pathfinder".

Mid-term Management Plan

-The Company announced its management plan, called Vision 20, setting 2020 as the final year to achieve the objectives set forth under the plan. At the same time, the Company is also operating under a five-year management plan called "Mid-term Plan 11", which set 2015 as the final year. Also, 2015 is the midway point under its newest management plan, Vision 2020, which has set a target of 600 billion yen for operating revenue and a 10% profit margin for operating profit.

- Mid-term Plan 11 has the following four main strategies in place in order to achieve its objectives by March 2016. The objective are as follows: 400 billion yen in operating revenue, 30 billion yen in operating profit, and a 7.5% operating profit margin.

• Concentrate management resources in strategic businesses in growing markets.
• Build a business model that improve revenue and profits
• Develop new customer demand based on proprietary technologies
• Continuously create corporate innovation

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

R&D Expenditure

(in millions of JPY)

	FY ended Dec. 31, 2012	FY ended Mar. 31, 2012	FY ended Mar. 31, 2011
Tire Business	3,956	4,999	5,459
DiverTech Business	1,605	2,457	2,249
In common	648	856	847
Overall	6,211	8,312	8,556

R&D Facilities

R&D Center	Osaka, Japan
Tire Technical Center	Hyogo Pref., Japan
Automotive Parts Technical Center	Aichi Pref., Japan
Miyazaki Tire Proving Ground	Miyazaki Pref., Japan
Saroma Tire Proving Ground	Hokkaido, Japan

-The Company announced that it will relocate its research and development center in Ibaraki, Osaka Prefecture, Japan to Kawanishi, Hyogo Prefecture to establish its new research and development site. The current R&D center conducts basic research on products and materials. The Company will also move and integrate part of the tire production and technology division of Tire Technology Center (Itami, Hyogo Prefecture) to the new site. The land area of the new site will be approximately 33,000 square meters, and the total floor space will amount to around 22,000 square meters. The site opening is expected in November 2013. (From a press release on August 10, 2012)

R&D Activities

DiverTech Business
<Transportation equipment>
-The Company has won a considerable number of orders from OEMs for highly functional parts such as engine mounts for high-end, luxury vehicle models.

-In the area of advanced technology, the Company is working to develop new products designed for eco-friendly vehicles, aiming to expand its business in this market sector.

-Environment: The Company had been focusing on developing hexahydric-chrome-free products. But its recent focus is on reducing VOC (volatile organic compound) emissions in its production lines as well as in its products by increasing the use of alternative materials.

-Fuel Economy: The Company is trying to develop parts that are not only lighter but also have higher performance, by making use of aluminum and resin materials; and by also developing new methods and new materials.

Capital Expenditure

(in millions of JPY)

	FY ended Dec. 31, 2012	FY ended Mar. 31, 2012	FY ended Mar. 31, 2011
Tire Business	18,553	26,564	26,299
DiverTech Business	2,502	2,800	1,814
Others	1,902	402
Overall	22,958	29,767	28,324

Tire Business
-The Company made a capital investment mainly to streamline production, improve product quality, enhance production facilities at tire plants in China and Malaysia.

DiverTech Business
-The Company made a capital investment mainly to streamline production and improve product quality.

Investment Outside Japan

<Malaysia>
-Toyo Tyre Malaysia Sdn. Bhd., Toyo Tire's new subsidiary, broke ground at its plant site in May 2012. The facility will commence production in the spring of 2013, serving as an important supply hub, as the Company aims to increase its presence in the growing market.

Planned Capital Investments

(As of Mar. 31, 2012)

Business division	Planned amount of investment (in million JPY)	Objective of the investment
Tire Business	19,982	Streamlining production and improving product quality; enabling operations to respond to the Company's global supply structure
DiverTech Business	4,491	Streamlining production and improving product quality; enabling operations to respond to the Company's global supply structure
In common	1,547	Strengthening research on fundamental technology
Total	26,020	-