YASKAWA Report YASKAWA ELECTRIC CORPORATION

Introduction Since its founding in 1915, and based on its management principle of contributing to the evolution of society and the welfare of humankind through the performance of its business, Yaskawa Electric has provided continuing support for the key industries of the times from motors and factory automation to the mechatronics* of today. At present we are working toward the first centenary of Yaskawa Electric's founding in 2015 by taking on the challenges of high - efficiency utilization of natural energy and the realization of a society in which people and robots coexist. Our mechatronic...

3 Consolidated Financial Highlights 21 Message from the Director in Charge of CSR 5 Interview with the President 22 Management Principles and Corporate Activity Standards 23 Corporate Governance 25 Board of Directors and Corporate Auditors 26 Relations with Customers 28 Relations with Suppliers 29 Relations with Employees 31 Relations with Shareholders and Investors 32 Relations with Local Communities and Society 9 Special Feature: Launching New Business! - Aiming Towards Realization of 2015 Vision - 34 Environmental Management 36 Contribution to the Environment through Products and Services...

Consolidated Financial Highlights Yaskawa Electric Corporation and Consolidated Subsidiaries Years ended March 20 or as of March 20 (Millions of yen) Operating Income Ratio Ordinary Income Ordinary Income Ratio Sales and Profit by Business Segment*1 Operating Income Operating Income Ratio Net Sales Motion Control Operating Income Operating Income Ratio Operating Income Operating Income Ratio Operating Income Operating Income Ratio Net Sales System Engineering Net Sales Information Technologies Sales by Destination Japan The Americas* Earning - basic Earning - diluted Shareholders' Equity Shareholders'...

Yaskawa Electric Corporation and Consolidated Subsidiaries Years ended March 20 or as of March 20 Net Sales: Breakdown by Business Segment Motion Control Robotics System Engineering Information Technologies Other Operating Income (Loss) and Operating Income (Loss) Ratio Operating Income (Loss) Operating Income (Loss) Ratio Overseas Sales Ratio The Americas Europe Asia Other Overseas Sales and Overseas Sales Ratio Shareholders' Equity, Interest-bearing Debt and Debt-to-equity Ratio Shareholders Equity Interest-bearing Debt Debt-to-equity Ratio Total Assets and Shareholders' Equity Ratio Total...

Interview with the President The new mid-term plan "Realize 100" began this year. 2015 will mark our 100th anniversary. Our goal for this momentous occasion is to achieve record-high performance by further expanding our core businesses around the world and growing our new businesses. Junji Tsuda Representative Director Chairman of the Board President Yaskawa Electric's new mid-term business plan "Realize 100" started in FY2013 (year ending March 2014). The plan aims to realize a high profitability structure by harvesting and continuously evolving the results produced in our previous mid-term...

Q1 FY2012 was the final year of the mid-term business plan "Challenge 100 ". Looking back, what sort of a year was it? from 20% in the end of FY2010 to 30% by the end FY2012. This has gradually reduced the impact of the exchange rate on our performance. A1 FY2009, the first year of "Challenge 100", posed significant challenges to the Yaskawa Group foremost of those the global financial crises. The extremely adverse conditions continued for the next few years. Our company saw an increasingly strong yen, steep rise in magnet prices, and a reduction in orders due to a stagnant semiconductor market....

we plan to increase our ratio of production outside Japan from 30% at the end of FY2012 to 50% by FY2015. Within Japan we plan to maintain production output by expanding sales into new businesses and markets. Furthermore, we aim to increase the operating profit ratio to at least 10% by FY2015 through improving efficiency of production via expanding automation in Japanese plants, launching new core products, and rolling out cost-cutting initiatives on a company-wide level. The second is "realization of a glocal management structure." This refers to building a management structure that can optimally...

Q6 What do you prioritize in the development of new robotics markets? A6 Up to now, the use of industrial robotics has been limited mostly to automobile production. The automobile industry began implementing robotics on their production lines early on. Thus they already possess a high level of know-how regarding the use of robotics. There are not nearly enough system integrators with the knowhow for using industrial robotics in other industries, so few companies outside the automotive industry have implemented robotics into their operations. Aiming to cultivate system integrators with a high...

Special Feature : Launching New Business! Aiming Towards Realization of 2015 Vision Yaskawa Electric has established the vision of using the group s core technologies to solve emerging global problems for the years leading up to its 100th anniversary in 2015. In the Environment & Energy business domain, we contribute to resolving environmental and energy issues through both energy creation and energy conservation. In the Robotics Human Assist business domain, we strive to provide solutions to combat problems associated with declining birthrate and aging population in advanced countries. This...

When we eventually began commercial production of power conditioners, there were a few manufacturers that had entered the market 5-10 years before us. As newcomers to the market, we focused on raising name recognition and brand awareness. At the time none of our competitors offered both home and industrial products, so leveraging our product line-up as a vehicle to promote ourselves as power conditioner specialists, we took top share in the 10 kW industrial power conditioner market in Japan as of the end of fiscal 2012. High reliability is essential in solar power system equipment, which must...