ANNUAL REPORTS2009ANNUAL REPORTS

資料編英文2009 09.9.4 1:34 PM ページ 2

　�

C O N T E N T S �

Consolidated Financial Highlights…………………1

A Message from the President………………………2

Topics……………………………………………………4

Consolidated Financial Statements………………7

　Consolidated Balance Sheets…………………………7�

　Consolidated Statements of Operations………………9

　Consolidated Statements of Changes in Equity……10

　Consolidated Statements of Cash Flows……………11

　Notes to Consolidated Financial Statements………13

　Independent Auditors' Report………………………19

Board of Directors and Auditors…………………20

Company Outline……………………………………21

資料編英文2009 09.9.4 1:34 PM ページ 3

1

Consolidated Financial Highlights

'09

Sumitomo Precision Products Co., Ltd.�For the years ended March 31, 2009 and 2008

'09

　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　 Thousands of�　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　Millions of Yen U.S. Dollars� 2009 2008 2009 �Net sales ¥48,805 ¥49,903 ＄496,844 �Income (Loss) before income taxes (1,673) (125) (17,031)�Net income (loss) (1,008) (356) (10,262)�Total assets 77,674 72,363 790,736 �Total shareholders' equity 26,573 28,780 270,518 ��　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　Yen U.S.dollars�Per share�　Net income (loss) (¥19.00) (¥6.72) (＄0.19)�　Cash dividends 6.00 7.00 0.06 ��Notes: 1. Yen amounts have been exchanged, for convenience only, at the rated of ¥98.23 to $1,� the approximate rate of exchange at march 31, 2008� 2. See notes to consolidated financial statements.

Net Sales�million ¥

Net Income (Loss)�million ¥

Shareholders' Equity�million ¥

'09'07 '08

49,90350,151

28,78026,573

29,806

'07 '08'07 '08

48,805

-356

-1,008

1,469

資料編英文2009 09.9.4 1:34 PM ページ 4

A Message from the President

Financial Report (April 1, 2008 to March 31, 2009)�Business Overview for the Corporate Group�(1) Status and Results�The Japanese economy deteriorated to a critical extent

in fiscal year 2008 amid a high level of uncertainty over

the future, due to the economic stagnation caused by

the global money market turmoil originating in the U.S.

and the rapid worsening of the demand structure.�

�

As a result of the weakened economy, our consolidated

sales for the current fiscal year decreased by 2.2% from

the previous year to ¥48.8 billion, despite the concerted

efforts of all our group members, in such a difficult

environment, to secure more orders and expand sales

in their respective fields, as well as to develop and

promote new products. �

�

The aerospace and hydraulic equipment business

segment recorded sales of ¥20.64 billion for the current

year, representing a 12.3% drop on the previous year

due to decreased sales of aircraft-related equipment

and hydraulic equipment for machine tools. On the

other hand, the heat exchanger and other industrial

equipment business segments enjoyed sales of ¥28.16

billion, a 6.8% increase in comparison with the previous

year, which was attributable to higher sales of heat

exchangers and liquid crystal display (LCD)

manufacturing equipment.�

�

In terms of profit and loss, all our group members tried

to improve productivity, streamline procurement and

achieve cost reductions in order to offset cost increases

that were caused by a fixed cost increase associated

with enhancement of production capacity and a rise in

raw material prices. However, the extremely strong

upward trend in the value of the Japanese yen and the

inventory valuation loss recorded reduced our

consolidated operating profit and loss by ¥1.76 billion

from the previous year, causing a consolidated

operating loss of ¥0.46 billion and a consolidated

ordinary loss of ¥1.67 billion. As a result, we recorded a

consolidated net loss of ¥1 billion for the current year. �

�

In comparison with the previous year, our non-

consolidated sales increased by ¥0.41 billion to ¥44.44

billion, representing an all-time high. On the other hand,

our non-consolidated operating profit and loss

decreased by ¥3.71 billion from the previous year,

resulting in a non-consolidated operating loss of ¥1.25

billion and a non-consolidated ordinary loss of ¥1.95

billion. An appraisal loss on affiliated company stock

was recorded for shares we held in our overseas

subsidiaries, based on our decision that we should value

these shares more cautiously, taking the subsidiaries’

business performance and the effect of the extremely

strong yen into account. Consequently, our non-

consolidated net loss worsened by ¥2.81 billion from

the previous year to ¥3.43 billion for the current year.�

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資料編英文2009 09.9.4 1:34 PM ページ 5

PresidentSusumu KAMINAGA

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(2) Capital Investment and Fund-raising Status�Capital investment amounted to ¥6.9 billion for the

current fiscal year, which was invested mainly in the

introduction of equipment designed to enhance the

production capacity of aircraft heat exchangers and

plasma processing systems.�

�

These capital investments were financed by loans. As

of the end of the current fiscal year, the balance of

corporate bonds and loans outstanding amounted to

¥33.7 billion.�

�(3) Management Challenges�The Japanese economic environment is likely to remain

extremely harsh in future, which suggests that the

overall business climate surrounding our group does

not allow for undue optimism. �

�

Even under these conditions, our group is determined

to accelerate its plans to secure more orders and

successfully develop new products and business. We

will also strive to rationalize production and reduce

fixed costs, and enhance earning capacity and

competitiveness as ways of improving our overall

performance.�

�

Specifically, in the aerospace and hydraulic equipment

business segment, we will boost our efforts to develop

landing gear for domestically produced jet-engine

passenger aircraft. At the same time, we will take part

in a new emerging project aimed at developing a heat

management system to be incorporated into the Rolls-

Royce engine for the Airbus A350XWB, and will also

expand our repair business.�

�

In the heat exchanger and other industrial equipment

business segments, we will continue to seek out every

opportunity to promote sales of existing products,

including LNG vaporizers and other equipment, mainly

in fields related to energy, the environment and

information technology. We will continue our R&D on

small distribution energy systems with the objective of

introducing mass production of related products in the

near future. In addition, we will continue our efforts to

develop a new gyro sensor and new products and

devices related to the Micro Electro Mechanical

Systems (MEMS) field.�

�

As detailed above, we are committed to strengthening

our performance through existing businesses in concert

with expansion into new business fields with high

growth potential. We are also committed to reducing

collective assets, including inventories, in order to

further improve our capital efficiency. All the members

of our group will continue working together to create a

stronger management foundation and ensure the

uninterrupted growth of our businesses in the future.

3

資料編英文2009 09.9.4 1:34 PM ページ 6

4

Topics

New vacuum brazing furnaceNo.8 Plant

Photograph provided by UTC Power (U.S.)

Aerospace Products

In January 2009, the No.8 Plant newly opened in the Head Office & Main Plant premises in Amagasaki. It has a total floor area of 9,674㎡ (where the aerospace heat exchanger segment occupies 6,151㎡).��Sales of aerospace heat exchangers are expected to increase substantially from now on. The newly completed plant not only provides increased floor space, but incorporates reinforced production facilities such as an additional vacuum brazing furnace. We now have an established production system which can accommodate increased production demands. At the same time, we will pursue further quality and productivity improvements through the implementation of an integrated production system and innovative production methods. We will endeavor to make this plant a production base for world-class aerospace heat exchangers.

■New Plant for Aerospace HEAT Management System Production

March 2008 saw the commencement of the MRJ (Mitsubishi Regional Jet) program, a project aimed at resurrecting the domestic production of commercial aircraft following an interval of about 40 years. �　�Having been selected as a partner company to design, develop and manufacture landing gear systems, one of the major systems for the MRJ, we received an order from Mitsubishi Aircraft Corporation (MJET) to design and develop various systems for the MRJ-90/70, such as landing gear (including tires, wheels and brakes), a brake control system for safety landing of aircraft, a steering control system for controlling the direction of taxiing aircraft, and a gear retraction system for retracting and extending landing gear during takeoff and landing.��We have already started a full-scale design and development program and are actively working on it with a view to the first flight in 2011 and the commencement of entry in service in 2013. We have design and development experience for each of the systems for which we received orders on this occasion. However, this is the first opportunity we have had to work on these systems collectively for a particular aircraft model. We will apply ourselves to this project through the concerted efforts of the Aerospace Business Unit.

■Participation in the Mitsubishi Regional Jet (MRJ) Program

Industrial Use Heat Exchangers��We have successfully delivered an ambient air LNG vaporizer (ABV with a vaporizing capacity of 4 tons/hour) designed for use in small-scale LNG terminals in the Rokku Satellite LNG terminal of Tokyo Gas Co., Ltd. jointly developed with Tokyo Gas Engineering Co., Ltd., integrating the technologies for open-rack vaporizers (ORVs) and aluminum plate-fin heat exchangers. The ABV has an energy-saving and environmentally friendly vaporization process, as it uses ambient air as a heat source for vaporizing LNG. The system is also highly reliable and serviceable, as it is based on the ORV technology.

■Ambient air LNG vaporizer (ABV)

UTC Power, U.S. has brought a new type of stationary fuel cell cogeneration system to the fuel cell market, where commercial development of a high-efficiency, low-pollution generating system using fuel cells is being actively pursued. Our stainless steel plate fin heat exchanger has contributed to a reduction in the size of the generator system, making the most of its compact and lightweight features.��To date, our heat exchangers have been used in phosphoric-acid and molten carbonate fuel cells. In addition, we will participate in fuel cell development projects with a central focus on high-temperature fuel cells such as solid oxide fuel cells, where we will contribute to improving fuel cell efficiency in order to meet the demand for larger heat exchangers.

■Supply of Stainless Steel Heat Exchangers for Phosphoric Acid Fuel Cells Commenced

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5

Environmental Systems■Technologies for the treatment of waste water containing persistent organic �　substance － Ozone + Biological Treatment System

Micro-Technology■Etching Systems for the High Volume Production of MEMS and SemiconductorsIn 1992, we started the Japanese distribution of silicon deep reactive ion etching (DRIE) systems manufactured by UK-based Surface Technology Systems (STS) in Japan for the Micro Electro-Mechanical Systems (MEMS) market. STS became our subsidiary in 1995 and in 2001 we started manufacturing these DRIE systems in Japan. Today these DRIE systems of the Sumitomo Precision Products (SPP) Group are the de facto standard and have a global market share of approximately 80%.��In order to further tap the growth potential of the MEMS, power device and optical communication device markets, we started to manufacture and sell sacrificial SiO2 layer dry etch release systems and plasma etching systems for SiC and SiO2.��In 2007, we launched VPX/CPX-PEGASUS DRIE multi-chamber cluster systems in order to meet the need for full-scale mass production in the MEMS market.��In 2008, we introduced PEGASUS 300, a DRIE system compatible with 300 mm wafers, for applications such as MEMS, semiconductor TSVs and power devices.��In the future, we are committed to further expand our business in the both the MEMS and semiconductor industries, with the technologies we have developed and accumulated to date, utilizing the highly reliable designs and manufacturing processes for our products and providing exceptional technical support to facilitate the application of our systems to mass production.

In the past, we have offered not only ozone generators, but also all-round waste water treatment technologies including ozone treatment technologies. Our latest achievements include the successful development of a combined treatment system for persistent organic substance, combining the technologies for ozone treatment with those for biological treatment.��Ozone is an extremely powerful oxidant which effectively degrades persistent organic substance. However, if waste water contains a high concentration of persistent organic substance, a huge amount of ozone is required for degradation, meaning the cost of such treatment systems will inevitably be too high. We thus developed a combined treatment system combining the technologies for ozone treatment with those for low-cost biological treatment. The system we developed degrades organic substance in a more efficient and time-saving manner than generally available biological treatment systems, and in a less costly way than treatment systems that use ozone alone. Commercial delivery of this new system has already started.��The new system can be applied to waste water treatment situations where an ozone treatment system is too costly to install, despite its effectiveness. If the system is applied to, for instance, treating waste water disposed of as industrial waste due to the lack of a treatment solution, it will prevent environmental pollution. New markets can be developed in areas such as South East Asia, where environmental rehabilitation is an important issue. Through applying our high-level water treatment technologies to various aquatic environments, we intend to further develop our solution business that contributes to the preservation of the global environment.

PEGASUS300 CPX-PEGASUS

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6

Sensors■MEMS Gyro-sensor-technology-applied Products－Attitude Measurement Units (AMUs)

We have been mass-producing MEMS gyro sensors since 1999, when Silicon Sensing Systems Ltd. was established. Our MEMS gyro sensors have received good ratings in the automobile market. From 2009 onward, we will expand the markets for our gyro-sensor-technology-applied system products, taking advantage of our gyro sensor’s distinctive features such as its compactness, high level of precision, and environmental resistance. Specifically, we will produce and market an attitude measurement unit (AMU).�　�This AMU contains components such as a gyro sensor, an acceleration sensor and an arithmetic circuit. It is an inertial measurement instrument which measures dynamic behavior by performing internal arithmetic using sensor readings for gravitational acceleration and movement. Anticipated AMU applications include not only automobiles, but also a variety of other mobile objects such as robots.��We initially introduced the AMU 1802A and commenced test sales of this product late last year. In the future, we will incorporate and reflect in our products various market requirements such as a data logging function, an extended measurement range, and more diverse input/output signal interfaces. With our expanded lineup of unit models, we will seek to exploit new markets for gyro-sensor-technology-applied products.

New Business & ResearchSuccessful Development of High Thermal Conductivity Composite Material

Since March 2004, we have been developing “Heat Exchanger Composite Material using Carbon Nanotubes” through the development program funded by Japan Science & Technology Agency. In March 2008, we successfully developed a composite material with thermal conductivity more than three times higher than that of aluminum alloy.��Given its high thermal conductivity and lightweight features, the developed composite material is expected to contribute to enhancing the cooling capacity of heat-spreading components of power semiconductors and cooling components of semiconductor manufacturing equipment, as well as to reducing the size and weight of thermal components used for automobiles and aircraft, where lightness is a desirable feature for every component.��We are currently supplying sample materials primarily used for cooling power semiconductors to customers such as automobile manufacturers and general electrical equipment manufacturers. We will establish technologies for the volume production of this material with a view to its commercialization. ��In addition, we have received a Division General Award (Category: Excellent Presented Paper) from the Materials and Processing Division (M&P Division) of the Japan Society of Mechanical Engineers.

�

The newly developed material spreads heat more quickly than conventional aluminum. It can suppress the temperature increase of the heat source.

Typical sample made of the composite material

MET■Etching and Cleaning Systems for the World’s Largest 10th Generation LCD PanelIn the last several years, TVs have become considerably “thinner, larger, and better in terms of image quality.” One of the driving forces in this trend has been liquid crystal TVs (LCTVs). LCTVs will evolve further, and it is anticipated that in 2011, 150 million of the 290 million TVs manufactured will be LCTVs.��An LCD panel is the “face” of an LCTV. In 2008, we delivered etching systems and cleaning systems to Sharp Corporation’s Sakai Plant, where the world’s largest 10th generation LCD panel (glass substrate size: approximately 2.9m × 3.1m) is to be manufactured. The Plant is scheduled to start operations in fall 2009. �　�Not only are they capable of handling the largest glass substrates in the world, but these systems also incorporate a number of the latest technologies. They are greatly admired for their outstanding processing performance, reliable substrate carrying ability, lower environmental load, and various safety features.

The newly�developed material

Aluminum alloy

資料編英文2009 09.9.4 1:35 PM ページ 9

7

Consolidated Financial Statements

Sumitomo Precision Products Co., Ltd. and Consolidated Subsidiaries�Consolidated Balance Sheets�

March 31, 2009 and 2008

　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　 Thousands of�　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　 U.S. Dollars�　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　 Millions of Yen　　　 (Note 1)�ASSETS�CURRENT ASSETS:�　Cash and cash equivalents�　Notes and accounts receivable:�　　Trade�　　Unconsolidated subsidiaries and associated companies�　　Allowance for doubtful accounts�　Inventories (Note 4)�　Deferred tax assets (Note 10)�　Other current assets�

　　　　　　 Total current assets��PROPERTY, PLANT AND EQUIPMENT:�　Land (Note 6)�　Buildings and structures (Note 6)�　Machinery and equipment�　Lease assets�　Construction in progress�

　　　　　　 Total�　Accumulated depreciation�

　　　　Net property, plant and equipment��INVESTMENTS AND OTHER ASSETS:�　Investment securities (Note 3)�　Investments in unconsolidated subsidiaries and associated companies�　Goodwill�　Deferred tax assets (Note 10)�　Other assets (Note 5)�　Allowance for doubtful accounts�

　　　　　　 Total investments and other assets��TOTAL��See notes to consolidated financial statements.

2008 ��

¥　 6,873 ��

20,544 �1,257 �(3)�

19,661 �1,200 �816 �

50,348 ���

3,156 �14,190 �28,557 �

�27 �

45,930 �(29,246)�

16,684 ���

1,252 �2,882 �356 �141 � 706 �(6)�

5,331 ��

¥　 72,363

2009 ��

¥　 7,889 ��

22,971 �554 �(2)�

19,024�1,073�945�

52,454���

3,665 �16,150 �29,537 �168 �471 �

49,991 �(30,194)�

19,797 ���

865 �2,157 �319 �

1,114 �969 �(1)�

5,423 ��

¥　 77,674 ��

2009 ��

$　 80,311 ��

233,849 �5,640 �(20)�

193,668 �10,923 �9,621 �

533,992 ���

37,310 �164,410 �300,692 � 1,711 �4,795 �

508,918 �(307,381)�

201,537 ���

8,806 �21,959 �3,247 �11,341 �9,864 � (10)�

55,207 ��

$　 790,736

資料編英文2009 09.9.4 1:35 PM ページ 10

8

　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　 Thousands of�　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　 U.S. Dollars�　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　 Millions of Yen　　　 (Note 1)�LIABILITIES AND EQUITY��CURRENT LIABILITIES:�　Short-term bank loans (Note 6)�　Current portion of long-term debt (Note 6)�　Payables:�　　Trade notes�　　Trade accounts�　　Unconsolidated subsidiaries and associated companies�　　Construction�　　Other�　Income taxes payable�　Accrued expenses�　Other current liabilities�

　　　　　　　Total current liabilities��LONG-TERM LIABILITIES:�　Long-term debt (Note 6)�　Liabilities for retirement benefits (Note 7)�　Other�

　　　　　　　Total long-term liabilities�

�

�COMMITMENTS AND CONTINGENT LIABILITIES �(Notes 12, 13 and 14)��EQUITY (Notes 8 and 16):�　Common stock, authorized, 200,000,000 shares; issued, �　　53,167,798 shares in 2009 and 2008�　Capital surplus�　Retained earnings�　Net unrealized gain on available-for-sale securities�　Foreign currency translation adjustments�　Treasury stock-at cost�　　157,158 shares in 2009 and 143,701 shares in 2008�

　　　　　　　Total�　　　　　　　　Total equity��

TOTAL

2008 ���

¥　14,071 �828 ��

3,428 �6,376 �78 �

1,689 �2,614 �81 �

1,306 �1,804 �

32,275 ���

10,692 �435 �181 �

11,308 �

�������

10,312 �11,332 �6,187 �346 �668 ��

(65)�

28,780 �28,780 �

�

¥ 　72,363

2009 ���

¥　 14,965 �1,337 �

�4,511 �5,680 �74 �

3,094 �1,738 �144 �1,178 �647 �

33,368 � ��

17,555 �42 �136 �

17,733 �

� � � � � � �

10,312 �11,332 �4,770 �126 �102 ��

(69)�

26,573 � 26,573 �

�

¥　 77,674

2009 ���

$ 　152,347 � 13,611 �

� 45,923 �57,823 �753 �

31,498 �17,693 �1,466 �11,992 �6,587 �

339,693 ���

178,713 � 428 � 1,384 �

180,525 �

　� ������

104,978 � 115,362 � 48,560 � 1,283 � 1,038 �

� (703)�

270,518 � 270,518 �

�

$　 790,736

Sumitomo Precision Products Co., Ltd. and Consolidated Subsidiaries�Consolidated Balance Sheets�

March 31, 2009 and 2008

資料編英文2009 09.9.4 1:35 PM ページ 11

9

Consolidated Financial Statements

Sumitomo Precision Products Co., Ltd. and Consolidated Subsidiaries�Consolidated Statements of Operations�Years Ended March 31, 2009 and 2008

　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　 Thousands of�　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　 U.S. Dollars�　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　 Millions of Yen　　　 (Note 1)��

NET SALES ��COST OF SALES (Note 12)�

　　　　　　　　　Gross profit��SELLING, GENERAL AND ADMINISTRATIVE EXPENSES (Notes 9 and 12)�

　　Operating income (loss)��OTHER INCOME (EXPENSES):�　Interest and dividend income�　Interest expense�　Loss on disposal of property, plant and equipment�　Loss on foreign currency exchange�　Equity in earnings of associated companies�　Extraordinary warranty loss�　Other-net�

　　　　　　　Other expenses-net�

LOSS BEFORE INCOME TAXES�

INCOME TAXES (Note 10):�　Current�　Refund�　Deferred�

　　　　　　　Total income taxes �

NET LOSS�

　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　Yen 　　　　　U.S. Dollars ��

PER SHARE OF COMMON STOCK (Notes 2.o): �　Basic net loss�　Cash dividends applicable to the year�

See notes to consolidated financial statements.

2008 �

¥　 49,903 ��

39,218 �

10,685 ��

9,383 �

1,302 � � �

69 �(511)�(22)�(810)�282 �(385)�(50)�

(1,427)�

125 �

�570 ��

(339)�

231 �

¥ 　 356 �

��

　�¥ 　6.72 �

7.00 ��

2009 �

¥　 48,805 ��

40,061 �

8,744 ��

9,208 �

(464)� � �

68 �(423)�(93)�(842)�150 ��

(69)�

(1,209)�

1,673 �

�108 �(77)�(696)�

(665)�

¥　1,008 �

��

　�¥ 　19.00 �

6.00 ��

2009 �

$　 496,844 ��

407,828 �

89,016 ��

93,740 �(4,724)�

��

692 �(4,306)�(947)�(8,571)�1,527 �

�(702)�

(12,307)�

17,031 �

�1,100 �(784)�(7,085)�

(6,769)�

$　 10,262�

��

　�$　　 0.19 �

0.06

資料編英文2009 09.9.4 1:35 PM ページ 12

10

Sumitomo Precision Products Co., Ltd. and Consolidated Subsidiaries�Consolidated Statements of Changes in Equity�

Years Ended March 31, 2009 and 2008

Thousands of shares / Millions of Yen

Shares AmountCapital�Surplus

Retained�Earnings

Minority�Interests

Total�Equity

Net unrealized�Gain on�

Available-for-�sale Securities

Foreign�Currency�Translation�Adjustments

Common Stock

Shares Amount Total

Treasury Stock

Thousands of U.S. Dollars (Note 1)

Capital�Surplus

Retained�Earnings

Minority�Interests

Total�Equity

Net unrealized�Gain on�

Available-for-�sale Securities

Foreign�Currency�Translation�AdjustmentsCommon Stock TotalTreasury Stock

$ 104,978 � ��������

$ 104,978

$　 (662)�����

(71)�30 ���

(703)

　�　�　�　�　�BALANCE, APRIL 1, 2007 53,168 ¥10,312 ¥11,332 ¥ 6,958 ¥ 727 ¥ 406 135 ¥ (59) ¥29,676 ¥ 130 ¥29,806 �　Net loss (356) (356) (356)�　Adjustment of retained earnings for a newly consolidated subsidiary 9 9 9 �　Cash dividends, ¥8 per share (424) (424) (424)�　Purchase of treasury stock 15 (9) (9) (9)�　Disposal of treasury stock (6) 3 3 3 �　Net change in the year (381) 262 (119) ¥ (130) (249)��BALANCE, MARCH 31, 2008 53,168 10,312 11,332 6,187 346 668 144 (65) 28,780 28,780 �　Net loss (1,008) (1,008) (1,008)�　Adjustment of retained earnings due to an adoption of PITF No.18 �　　(Note 2.b) (37) (37) (37)�　Cash dividends, ¥7 per share (371) (371) (371)�　Purchase of treasury stock 21 (7) (7) (7)�　Disposal of treasury stock (1) (8) 3 2 2 �　Net change in the year (220) (566) (786) (786)��BALANCE, MARCH 31, 2009 53,168 ¥ 10,312 ¥ 11,332 ¥ 4,770 ¥ 126 ¥ 102 157 ¥ (69) ¥ 26,573 ¥ 26,573 �　�　�　�　�　�　��BALANCE, MARCH 31, 2008 $ 115,362 $ 62,985 $ 3,522 $ 6,800 $ 292,985 $ 292,975 �　Net loss (10,262) (10,262) (10,262)�　Adjustment of retained earnings due to an adoption of PITF No.18 �　　(Note 2.b) (376) (376) (376)�　Cash dividends, $0.07 per share (3,777) (3,777) (3,777)�　Purchase of treasury stock (71) (71)�　Disposal of treasury stock (10) 20 20 �　Net change in the year (2,239) (5,762) (8,001) (8,001)��BALANCE, MARCH 31, 2009 $ 115,362 $ 48,560 $ 1,283 $ 1,038 $ $ 270,518 $ 270,518 ���See notes to consolidated financial statements.

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Consolidated Financial Statements

Sumitomo Precision Products Co., Ltd. and Consolidated Subsidiaries�Consolidated Statements of Cash Flows�Years Ended March 31, 2009 and 2008

　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　 Thousands of�　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　 U.S. Dollars�　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　 Millions of Yen　　　 (Note 1)��

OPERATING ACTIVITIES:�　Loss before income taxes �　Adjustments for:�　　Income taxes paid�　　Income taxes refunded�　　Depreciation and amortization�　　Amortization of goodwill�　　Loss on disposal of property, plant and equipment�　　Decrease in liability for retirement benefits�　　Loss on foreign currency exchange�　　Equity in earnings of associated companies�　　Changes in assets and liabilities:�　　　Decrease (increase) in receivables�　　　Increase in inventories�　　　Increase in other current assets�　　　Increase (decrease) in payables�　　　Increase (decrease) in other current liabilities�　　Other-net��

　　　　　　　　Total adjustments�

　　　　　　　　Net cash used in operating activities��INVESTING ACTIVITIES:�　Purchases of property, plant and equipment�　Proceeds from sales of property, plant and equipment�　Purchases of investment securities�　Proceeds from sales of investment securities�　Acquisition of additional shares of a consolidated subsidiary�　Other-net��　　　　　　　Net cash used in investing activities��FINANCING ACTIVITIES:�　Increase in short-term bank loans－net�　Repayments of long-term debt�　Proceeds from long-term debt�　Dividends paid�　Purchase of treasury stock－net��　　　　　　　Net cash provided by financing activities�　FORWARD�

2008 �

�¥　 (125) �

�(1,114)�

�2,006 �19 �22 �(307)�32 �(282)�

�357 �(1,334)�(307)�(1,541)�707 � 57 ��

(1,685)�

(1,810)���

(3,070)�54 �(197)�

�(375)�(17)��

(3,605)���

2,549 �(2,082)�6,100 �(424)�(6)��

6,137 �¥　 722

2009 �

�¥　 (1,673)�

� (270)� 89 �2,421 �38 �93 �(394)�766 �(150)�

�(2,993)�(38)�(295)�691 �(967)�(103)�

�

(1,112)�

(2,785)���

(5,221)��

(76)�14 ��

(340)��

(5,623)���

3,336 �(875)�8,079�(371)�(5)��

10,164 �¥　 1,756

2009 �

�$　 (17,031)�

�(2,749)� 906 �

24,646 �387 � 947 �(4,011)�7,798 �(1,527)�

�(30,469)�(387)�(3,003)�7,035 �(9,845)�(1,049)�

�

(11,321)�

(28,352)���

(53,151)��

(774)�143 ��

(3,461)��

(57,243)���

33,961 �(8,908)�82,246�(3,777)�(51)��

103,471 �$　 17,876

資料編英文2009 09.9.4 1:35 PM ページ 14

12

　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　 Thousands of�　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　 U.S. Dollars�　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　 Millions of Yen　　　 (Note 1)��

FORWARD�

FOREIGN CURRENCY TRANSLATION ADJUSTMENTS �　ON CASH AND CASH EQUIVALENTS�

NET INCREASE IN CASH AND CASH EQUIVALENTS�

CASH AND CASH EQUIVALENTS OF A NEWLY CONSOLIDATED�　SUBSIDIARY, BEGINNING OF YEAR�

CASH AND CASH EQUIVALENTS, �　BEGINNING OF YEAR�

CASH AND CASH EQUIVALENTS, END OF YEAR���See notes to consolidated financial statements.

Sumitomo Precision Products Co., Ltd. and Consolidated Subsidiaries�Consolidated Statements of Cash FlowsYears Ended March 31, 2009 and 2008

2008 �

¥　 722 ��

(16)�

706 �

�

111 �

�

　 6,056 �

¥　 6,873

2009 �

¥　 1,756 �

�

(740)�

1,016 �

�

�

�

6,873 �

¥　 7,889

2009 �

$　 17,876 �

�

(7,533)�

10,343 �

�

�

�

　69,968 �

$　80,311

資料編英文2009 09.9.4 1:35 PM ページ 15

13

Consolidated Financial Statements

Sumitomo Precision Products Co., Ltd. and Consolidated Subsidiaries�Notes to Consolidated Financial Statements�

Years Ended March 31, 2009 and 2008

1. BASIS OF PRESENTING CONSOLIDATED FINANCIAL STATEMENTS��The accompanying consolidated financial statements of Sumitomo Precision Products Co., Ltd. (the “Company”) have been prepared in accordance with the provisions set forth in the Japanese Financial Instruments and Exchange Act and its related accounting regulations, and in conformity with accounting principles generally accepted in Japan (“Japanese GAAP”), which are different in certain respects as to application and disclosure requirements of International Financial Reporting Standards.��In preparing these consolidated financial statements, certain reclassifications and rearrangements have been made to the Company’s consolidated financial statements issued domestically in order to present them in a form which is more familiar to readers outside Japan. In addition, certain reclassifications have been made in the 2008 financial statements to conform to the classifications used in 2009.��The consolidated financial statements are stated in Japanese yen, the currency of the country in which the Company is incorporated and operates. The translations of Japanese yen amounts into U.S. dollar amounts are included solely for the convenience of readers outside Japan and have been made at the rate of ¥98.23 to $1, the approximate rate of exchange at March 31, 2009. Such translations should not be construed as representations that the Japanese yen amounts could be converted into U.S. dollars at that or any other rate.���2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES��a. Consolidation - The consolidated financial statements as of March 31, 2009 include the accounts of the Company and its ten (eleven in 2008) significant subsidiaries (together, the “Group”).�

�　Under the control or influence concept, those companies in which the Company, directly or indirectly, is able to exercise control over operations are fully consolidated, and those companies over which the Group has the ability to exercise significant influence are accounted for by the equity method.�

�　Investments in four (four in 2008) associated companies are accounted for by the equity method.�

�　Investments in the remaining unconsolidated subsidiaries and associated companies are stated at cost. If the equity method of accounting had been applied to the investments in these companies, the effect on the accompanying consolidated financial statements would not be material. �

�　The excess of the cost of an acquisition over the fair value of the net assets of the acquired subsidiary at the date of acquisition is being amortized on a straight-line method over a period of 10 years.�

�　All significant intercompany balances and transactions have been eliminated in consolidation. All material unrealized profit included in assets resulting from transactions within the Group is eliminated.�

�b. Unification of Accounting Policies Applied to Foreign Subsidiaries for the

Consolidated Financial Statements - In May 2006, the Accounting Standards Board of Japan (the “ASBJ”) issued ASBJ Practical Issues Task Force (PITF) No.18, “Practical Solution on Unification of Accounting Policies Applied to Foreign Subsidiaries for the Consolidated Financial Statements”. PITF No.18 prescribes: (1) the accounting policies and procedures applied to a parent company and its subsidiaries for similar transactions and events under similar circumstances should in principle be unified for the preparation of the consolidated financial statements, (2) financial statements prepared by foreign subsidiaries in accordance with either International Financial Reporting Standards or the generally accepted accounting principles in the United States of America tentatively may be used for the consolidation process, (3) however, the following items should be adjusted in the consolidation process so that net income is accounted for in accordance with Japanese GAAP unless they are not material: 1) amortization of goodwill; 2) scheduled amortization of actuarial gain or loss of pensions that has been directly recorded in the equity; 3) expensing capitalized development costs of R&D; 4) cancellation of the fair value model accounting for property, plant, and equipment and investment properties and incorporation of the cost model accounting; 5) recording the prior years’ effects of changes in accounting policies in the income statement where retrospective adjustments to financial statements have been incorporated; and 6) exclusion of minority interests from net income, if contained. PITF No.18 was effective for fiscal years beginning on or after April 1, 2008.�

�　The Company applied this accounting standard effective April 1, 2008. The effect of this change on operating loss and loss before income taxes is not material. In addition, the Company adjusted the beginning balance of retained earnings at April 1, 2008 as if this accounting standard had been retrospectively applied.�

�c. Cash Equivalents - Cash equivalents are short-term investments that are readily convertible into cash and that are exposed to insignificant risk of changes in value. Cash equivalents include time deposits which mature or

become due within three months of the date of acquisition.��d. Inventories - Prior to April 1 2008, inventories were stated at cost substantially determined by the average cost method for all finished goods, semi-finised goods and work in process, the specific identification method for certain work in process, and the moving average method for all raw materials. In July 2006, the ASBJ issued ASBJ Statement No.9, “Accounting Standard for Measurement of Inventories”. This standard requires that inventories held for sale in the ordinary course of business be measured at the lower of cost or net selling value, which is defined as the selling price less additional estimated manufacturing costs and estimated direct selling expenses. The replacement cost may be used in place of the net selling value, if appropriate. The standard was effective for fiscal years beginning on or after April 1, 2008.�

�　The Company applied this new accounting standard for measurement of inventories effective April 1, 2008. The effect of this change was to increase operating loss, and loss before income taxes by ¥1,117 million ($11,371 thousand). �

�e. Investment Securities - The standard requires all applicable securities to be classified and accounted for, depending on management’s intent, as trading securities, held-to-maturity debt securities and available-for-sale securities. The group does not have securities in the former two categories.�

�　Available-for-sale securities, which are not classified as either trading securities or held-to-maturity debt securities, are reported at fair value, with unrealized gains and losses, net of applicable taxes, reported in a separate component of equity. �

�　Non-marketable available-for-sale securities are stated at cost determined by the moving-average method. �

�　For other than temporary declines in fair value, investment securities are reduced to net realizable value by a charge to income.�

�f. Property, Plant and Equipment - Property, plant and equipment are stated at cost. Depreciation of property, plant and equipment of the Company and its consolidated domestic subsidiaries is computed substantially by the declining-balance method, while the straight-line method is applied to buildings and lease assets of the Company, and all property, plant and equipment of consolidated foreign subsidiaries. The range of useful lives is principally from 3 to 50 years for buildings and structures and from 4 to 9 years for machinery and equipment. The useful lives for lease assets are the terms of respective leases.�

�g. Long-lived assets - The Group reviews its long-lived assets for impairment whenever events or changes in circumstance indicate the carrying amount of an asset or asset group may not be recoverable. An impairment loss would be recognized if the carrying amount of an asset or asset group exceeds the sum of the undiscounted future cash flows expected to result from the continued use and eventual disposition of the asset or asset group. The impairment loss would be measured as the amount by which the carrying amount of the asset exceeds its recoverable amount, which is the higher of the discounted cash flows from the continued use and eventual disposition of the asset or the net selling price at disposition.�

�h. Derivatives and Hedging Activities - The Group uses derivative financial instruments to manage its exposures to fluctuations in foreign exchange. Foreign exchange forward contracts are utilized by the Group to reduce foreign currency exchange risks. The Group does not enter into derivatives for trading or speculative purposes.�

�　Derivative financial instruments and foreign currency transactions are classified and accounted for as follows: a) all derivatives are recognized as either assets or liabilities and measured at fair value, and gains or losses on derivative transactions are recognized in the consolidated statements of operations and b) for derivatives used for hedging purposes, if derivatives qualify for hedge accounting because of high correlation and effectiveness between the hedging instruments and the hedged items, gains or losses on derivatives are deferred until maturity of the hedged transactions.�

�　The foreign currency forward contracts are utilized to hedge foreign currency exposures for export sales. Trade receivables denominated in foreign currencies are translated at the contracted rates if the forward contracts qualify for hedge accounting. Forward contracts applied for forcasted or committed transactions are measured at fair value but the unrealized gains/losses are deferred until the underlying transactions are completed.�

i. Retirement Benefits - The Company and its consolidated domestic subsidiaries have a funded non-contributory defined benefit retirement plan covering substantially all of its employees. Overseas subsidiaries have defined contribution retirement plans. The Group accounts for the liability for retirement benefits based on projected obligations and plan assets at the balance sheet date. At the end of the current consolidated fiscal year, prepaid pension cost of the Company is included in other assets.�

j. Research and Development Costs - Research and development costs are charged to income as incurred.�

�

資料編英文2009 09.9.4 1:35 PM ページ 16

k. Leases - In March 2007, the ASBJ issued ASBJ Statement No.13, “Accounting Standard for Lease Transactions”, which revised the previous accounting standard for lease transactions issued in June 1993. The revised accounting standard for lease transactions is effective for fiscal years beginning on or after April 1, 2008.�

�　Under the previous accounting standard, finance leases that deem to transfer ownership of the leased property to the lessee were to be capitalized. However, other finance leases were permitted to be accounted for as operating lease transactions if certain “as if capitalized” information is disclosed in the note to the lessee’s financial statements. The revised accounting standard requires that all finance lease transactions should be capitalized to recognize lease assets and lease obligations in the balance sheet. In addition, the accounting standard permits leases which existed at the transition date and do not transfer ownership of the leased property to the lessee to be accounted for as operating lease transactions.�

�　The Company applied the revised accounting standard effective April 1, 2008. In addition, the Company accounted for leases which existed at the transition date and do not transfer ownership of the leased property to the lessee as operating lease transactions. This change has no impact on operating loss and loss before income taxes. �

�l. Income Taxes - The provision for income taxes is computed based on the pretax income included in the consolidated statements of operations. The asset and liability approach is used to recognize deferred tax assets and liabilities for the expected future tax consequences of temporary differences between the carrying amounts and the tax bases of assets and liabilities. Deferred taxes are measured by applying currently enacted tax laws to the temporary differences.�

�m. Foreign Currency Transactions - All short-term and long-term monetary receivables and payables denominated in foreign currencies are translated into Japanese yen at the current exchange rates as of the balance sheet date. The foreign exchange gains and losses from translation are recognized in the consolidated statements of operations to the extent that they are not hedged by forward exchange contracts.�

�n. Foreign Currency Financial Statements - The balance sheet accounts of the consolidated foreign subsidiaries are translated into Japanese yen at the current exchange rate as of the balance sheet date except for equity, which is translated at the historical rate.�

　Differences arising from such translation are shown as “Foreign currency translation adjustments” in a separate component of equity.�

�　Revenue and expense accounts of consolidated foreign subsidiaries are translated into Japanese yen at the current exchange rates as of the balance sheet date.�

�o. Per Share Information - Basic net income per share is computed by dividing net income available to common shareholders by the weighted-average number of common shares outstanding for the period, retroactively adjusted for stock splits. The number of common shares used in computing basic net income per share was 53,018 thousand shares for 2009 and 53,027 thousand shares for 2008.�

�　Diluted net income per share reflects the potential dilution that could occur if securities were exercised or converted into common stock. Diluted net income per share of common stock assumes full conversion of the outstanding convertible notes and bonds at the beginning of the year (or at the time of issuance) with an applicable adjustment for related interest expense, net of tax, and full exercise of outstanding warrants (if any).�

�　Diluted net income per share is not disclosed because of the Company’s net loss position for the years ended March 31, 2009 and 2008, respectively.�

�　Cash dividends per share presented in the accompanying consolidated statements of operations are dividends applicable to the respective years including dividends to be paid after the end of the year.�

�p. New Accounting Pronouncements��　Business Combinations - On December 26, 2008, the ASBJ issued a revised accounting standard for business combinations, ASBJ Statement No.21, �“Accounting Standard for Business Combinations”. Major accounting changes under the revised accounting standard are as follows:�

　(1) The current accounting standard for business combinations allows companies to apply the pooling of interests method of accounting when certain specific criteria are met such that the business combination is essentially regarded as a uniting-of-interests. The revised standard requires to account for such business combination by the purchase method and the pooling of interests method of accounting is no longer allowed.�

�　(2) The current accounting standard accounts for the research and

development costs to be charged to income as incurred. Under the revised standard, an in-process research and development (IPR&D) acquired by the business combination is capitalized as an intangible asset.�

�

　(3) The current accounting standard accounts for a bargain purchase gain (negative goodwill) to be systematically amortized within 20 years. Under the revised standard, the acquirer recognizes a bargain purchase gain in profit or loss on the acquisition date after reassessing whether it has correctly identified all of the assets acquired and all of the liabilities assumed with a review of such procedures used.�

�　This standard is applicable to business combinations undertaken on or after April 1, 2010 with early adoption permitted for fiscal years beginning on or after April 1, 2009.�

�　Unification of Accounting Policies Applied to Foreign Associated Companies for the

Equity Method - The current accounting standard requires unification of accounting policies within the consolidation group. However, the current guidance allows application of the equity method for the financial statements of its foreign associated company which have been prepared in accordance with generally accepted accounting principles in their respective jurisdictions without unification of accounting policies.�

�　On December 26, 2008, the ASBJ issued ASBJ Statement No.16 (Revised 2008), “Revised Accounting Standard for Equity Method of Accounting for Investments”. The new standard requires adjustments to be made to conform the associate’s accounting policies for similar transactions and events under similar circumstances to those of the parent company when the associate’s financial statements are used in applying the equity method unless it is impractible to determine adjustments. In addition, financial statements prepared by foreign associated companies in accordance with either International Financial Reporting Standards or the generally accepted accounting principles in the United States tentatively may be used in applying the equity method if the following items are adjusted so that net income is accounted for in accordance with Japanese GAAP unless they are not material: 1) amortization of goodwill; 2) scheduled amortization of actuarial gain or loss of pensions that has been directly recorded in the equity; 3) expensing capitalized development costs of R&D; 4) cancellation of the fair value model accounting for property, plant, and equipment and investment properties and incorporation of the cost model accounting; 5) recording the prior years’ effects of changes in accounting policies in the income statement where retrospective adjustments to the financial statements have been incorporated; and 6) exclusion of minority interests from net income, if contained.�

�　This standard is applicable to equity method of accounting for investments effective on or after April 1, 2010 with early adoption permitted for fiscal years beginning on or after April 1, 2009.�

�　Asset Retirement Obligations - On March 31, 2008, the ASBJ published a new accounting standard for asset retirement obligations, ASBJ Statement No.18 “Accounting Standard for Asset Retirement Obligations” and ASBJ Guidance No.21 “Guidance on Accounting Standard for Asset Retirement Obligations”. Under this accounting standard, an asset retirement obligation is defined as a legal obligation imposed either by law or contract that results from the acquisition, construction, development and the normal operation of a tangible fixed asset and is associated with the retirement of such tangible fixed asset.�

�　The asset retirement obligation is recognized as the sum of the discounted cash flows required for the future asset retirement and is recorded in the period in which the obligation is incurred if a reasonable estimate can be made. If a reasonable estimate of the asset retirement obligation cannot be made in the period the asset retirement obligation is incurred, the liability should be recognized when a reasonable estimate of asset retirement obligation can be made. Upon initial recognition of a liability for an asset retirement obligation, an asset retirement cost is capitalized by increasing the carrying amount of the related fixed asset by the amount of the liability. The asset retirement cost is subsequently allocated to expense through depreciation over the remaining useful life of the asset. Over time, the liability is accreted to its present value each period. Any subsequent revisions to the timing or the amount of the original estimate of undiscounted cash flows are reflected as an increase or a decrease in the carrying amount of the liability and the capitalized amount of the related asset retirement cost. This standard is effective for fiscal years beginning on or after April 1, 2010 with early adoption permitted for fiscal years beginning on or before March 31, 2010.�

�　Construction Contracts - Under the current Japanese GAAP, either the completed-contract method or the percentage-of-completion method is permitted to account for construction contracts. In December 2007, the ASBJ issued a new accounting standard for construction contracts. Under this new accounting standard, the construction revenue and construction costs should be recognized by the percentage-of-completion method, if the outcome of a construction contract can be estimated reliably. When total construction revenue, total construction costs and the stage of completion of the contract at the balance sheet date can be reliably measured, the outcome of a construction contract can be estimated reliably. If the outcome of a construction contract cannot be reliably estimated, the completed-contract method shall be applied. When it is probable that total construction costs will exceed total construction revenue, an estimated loss on the contract should be immediately recognized by providing for loss on construction contracts. This standard is applicable to construction contracts and software development contracts and effective for fiscal years beginning on or after April 1, 2009.

14

資料編英文2009 09.9.4 1:35 PM ページ 17

Consolidated Financial Statements

Sumitomo Precision Products Co., Ltd. and Consolidated Subsidiaries�Notes to Consolidated Financial Statements�

Years Ended March 31, 2009 and 2008

3. INVESTMENT SECURITIES�Investment securities as of March 31, 2009 and 2008 that were classified as available-for-sale securities and consisted of the following: ��������The carrying amounts and aggregate fair values of available-for-sale securities at March 31, 2009 and 2008 were as follows:�������������Available-for-sale securities whose fair value is not readily determinable as of March 31, 2009 and 2008 were as follows:���������Proceeds from sales of available-for-sale securities for the years ended March 31, 2009 and 2008 were ¥14 million ($143 thousand) and none, respectively. Gross realized gains and losses on these sales were not material for the year ended March 31, 2009.��4. INVENTORIES�Inventories at March 31, 2009 and 2008 consisted of the following:���������5. OTHER ASSETS�Other assets include long-term loans to employees bearing interest at rates ranging from 3.285% to 5.000% per annum in the amounts of ¥74 million ($753 thousand) and ¥117 million at March 31, 2009 and 2008, respectively.��6. SHORT-TERM BANK LOANS AND LONG-TERM DEBT�Short-term bank loans bear interest at rates ranging from 1.01% to 5.85% at March 31, 2009 and from 1.27% to 8.65% at March 31, 2008, respectively.��Long-term debt at March 31, 2009 and 2008 consisted of the following:����

������������������Annual maturities of long-term debt, at March 31, 2009 were as follows:�����������The conversion price of the zero coupon convertible bonds was ¥856 per share at March 31, 2009 and is subject to adjustments to reflect stock splits and certain circumstances.��At March 31, 2009, the bonds were convertible into 5,834,160 shares of the Company’s common stock.��At March 31, 2009, land and buildings of ¥1,053 million ($10,720 thousand) were pledged as collateral for long-term bank loans of ¥429 million ($4,367 thousand). ��Long-term bank loans include syndicate loan agreements amounting to ¥7,000 million ($71,261 thousand) and ¥4,445 million ($45,251 thousand) at March 31, 2009. In the event that any of the following articles are violated, the borrower may lose the benefit of the term for all the liabilities under these agreements. These agreements include the following financial restriction provisions:��(1) Ordinary income in the consolidated or non-consolidated statements of operations should not be negative for two consecutive years. Ordinary income means income before income taxes less extra ordinary items.�

(2-1) The amount of equity in the consolidated or non-consolidated balance sheets at the end of fiscal years should be more than 80% of ¥28,780 million or ¥31,720 million (equity at the March 31, 2008) for the syndicate loan agreements amounting to ¥7,000 million ($71,261 thousand).�

(2-2) The amount of equity in the consolidated or non-consolidated balance sheets at the end of fiscal years should be more than 80% of ¥29,806 million or ¥33,156 million (equity at the March 31, 2007) for the syndicate loan agreements amounting to ¥4,445 million ($45,251 thousand).�

�7. RETIREMENT BENEFITS�The Company and its domestic consolidated subsidiaries have defined benefit retirement plans for employees. ���

　　　　　　　　　　　　　Thousands of�　　　　 Millions of Yen　　 U.S. Dollars

2009　 2008　 2009　�　Finished products and semi-finished products ￥ 4,035 ￥ 3,793 $ 41,077�　Work in process 9,733 9,614 99,084�　Raw materials and supplies 5,256 6,254 53,507�　　　Total ￥19,024 ￥19,661 $193,668

　　　　　　　　　　 Thousands of�Millions of Yen　　　　U.S. Dollars

2009 2008 2009�　Marketable equity securities ￥631 ￥ 1,003 $6,424�　Other 234 249 2,382�　　Total ￥865 ￥ 1,252 $8,806

　　　　　　　　　　　　　　　　　　　　　　Millions of 　　　　　Thousands of�Year Ending March 31 　　　　　　　　　　　　Yen 　　　　　　U.S. Dollars

　　　 2010 ¥1,337 $13,611�　　　 2011 7,375 75,079�　　　 2012 1,450 14,761�　　　 2013 1,296 13,194�　　　 2014 7,261 73,918�　　　 2015 and thereafter 173 1,761�　　　 Total ¥　18,892 $　192,324���

2009 2008 2009�　Equity securities ￥ 218 ￥ 231 $ 2,219�　Investments in limited partnership 16 18 163�　　　Total ￥ 234 ￥ 249 $ 2,382

　　　　　Carrying amount�　　　　　　　　　　　　Thousands of�Millions of Yen 　　　　 　U.S. Dollars

　　Equity securities ￥ 420 ￥ 212 ￥ 1 ￥ 631��

March 31, 2008�

　　Equity securities ￥ 422 ￥ 583 ￥ 2 ￥ 1,003��

Thousands of U.S. Dollars� Unrealized Unrealized Fair�March 31, 2009 Cost Gains Losses Value�

　　Equity securities ＄ 4,276 ＄ 2,158 ＄ 10 ＄ 6,424

Millions of Yen� Unrealized Unrealized Fair�March 31, 2009 Cost Gains Losses Value

2009 2008 2009 �Zero coupon unsecured yen convertible�　bonds, due 2011 ￥ 4,995 ￥ 4,995 $ 50,850 �Loans from banks �　and insurance companies, due�　serially to 2016 with interest rates �　ranging from 1.32% to 5.00% (2009) �　and from 1.32% to 2.09% (2008) �　Collateralized 429 4,367 �　Unsecured 13,320 6,525 135,600 �Obligation under finance leases 148 1,507 �　　　Total 18,892 11,520 192,324 ��Less current portion (1,337) (828) (13,611)�Long-term debt, less current portion ￥17,555 ￥10,692 $178,713

　　　　　　　　　　　Thousands of�　 Millions of Yen　　　 U.S. Dollars

�

15

資料編英文2009 09.9.4 1:35 PM ページ 18

16

Employees terminating their employment are, under most circumstances, entitled to retirement benefits determined by reference to basic rates of pay at the time of termination, length of service, and conditions under which the termination occurs. If the termination is involuntary, caused by retirement at the mandatory retirement age or caused by death, the employee is entitled to greater payments than in the case of voluntary termination.��Employees of the Company who retire at the mandatory retirement age are entitled to receive approximately 50% of their benefits in the form of an annuity with the balance in a lump-sum payment upon retirement. The funds for the annuity payments are entrusted to an outside trustee.��The liability for employees’ retirement benefits at March 31, 2009 and 2008 consisted of the following:�������������The components of net periodic retirement benefit costs for the years ended March 31, 2009 and 2008 are as follows:���������������Assumptions used for the years ended March 31, 2009 and 2008 are set forth as follows:��������8. EQUITY�Since May 1, 2006, Japanese companies have been subject to the Companies Act of Japan (the “Companies Act”). The significant provisions in the Companies Act that affect financial and accounting matters are summarized below:��(a) Dividends�Under the Companies Act, companies can pay dividends at any time during the fiscal year in addition to the year-end dividend upon resolution at the shareholders meeting. For companies that meet certain criteria such as; (1) having the Board of Directors, (2) having independent auditors, (3) having the Board of Corporate Auditors, and (4) the term of service of the directors is prescribed as one year rather than two years of normal term by its articles of incorporation, the Board of Directors may declare dividends (except for dividends in kind) at any time during the fiscal year if the company has prescribed so in its articles of incorporation. However, the Company and consolidated subsidiaries cannot do so because they do not meet all the above criteria.��The Companies Act permits companies to distribute dividends-in-kind (non-cash assets) to shareholders subject to a certain limitation and additional requirements.��Semiannual interim dividends may also be paid once a year upon resolution by the Board of Directors if the articles of incorporation of the company so stipulate. The Companies Act provides certain limitations on the amounts available for dividends or the purchase of treasury stock. The limitation is defined as the amount available for distribution to the shareholders, but the amount of net assets after dividends must be maintained at no less than ¥3 million.�

(b) Increases / decreases and transfer of common stock, reserve and surplus�The Companies Act requires that an amount equal to 10% of dividends must be appropriated as a legal reserve (a component of retained earnings) or as additional paid-in capital (a component of capital surplus) depending on the equity account charged upon the payment of such dividends until the total of aggregate amount of legal reserve and additional paid-in capital equals 25% of the common stock. Under the Companies Act, the total amount of additional paid-in capital and legal reserve may be reversed without limitation. The Companies Act also provides that common stock, legal reserve, additional paid-in capital, other capital surplus and retained earnings can be transferred among the accounts under certain conditions upon resolution of the shareholders.��(c) Treasury stock and treasury stock acquisition rights�The Companies Act also provides for companies to purchase treasury stock and dispose of such treasury stock by resolution of the Board of Directors. The amount of treasury stock purchased cannot exceed the amount available for distribution to the shareholders which is determined by specific formula. Under the Companies Act, stock acquisition rights are presented as a separate component of equity. The Companies Act also provides that companies can purchase both treasury stock acquisition rights and treasury stock. Such treasury stock acquisition rights are presented as a separate component of equity or deducted directly from stock acquisition rights.���9. SELLING, GENERAL AND ADMINISTRATIVE EXPENSES�Selling, general and administrative expenses for the years ended March 31, 2009 and 2008 principally consisted of the following: �����������10. INCOME TAXES�The Company and its domestic subsidiaries are subject to Japanese national and local income taxes which, in the aggregate, resulted in a normal effective statutory tax rates of approximately 40.6% for the years ended March 31, 2009 and 2008.��The tax effects of significant temporary differences and tax loss carryforwards which resulted in deferred tax assets and liabilities at March 31, 2009 and 2008 are as follows:����������������������������A reconciliation between the normal effective statutory tax rates and the actual effective tax rates reflected in the accompanying consolidated statements of operations for the years ended March 31, 2009 and 2008 is as follows:

2009 2008�　Discount rate 2.5% 2.5%�　Expected rate of return on plan assets 3% 3%�　Amortization period of prior service cost 10 years 10 years�　Recognition period of actuarial gain / loss 10 years 10 years

　　　　　　　　　　 Thousands of �Millions of Yen　　　　U.S. Dollars

2009　 2008　 2009　�　Service cost ¥ 299 ¥ 277 $ 3,044 �　Interest cost 153 158 1,558 �　Expected return on plan assets (117) (143) (1,191)�　Amortization of prior service cost (36) (36) (367)�　Recognized actuarial loss 304 193 3,095 �　Additional retirement benefits 　19 　193 �　Contributions to the defined �　　contribution pension plan 　29 　64 　295 �　Net periodic retirement benefit costs ¥ 651 ¥ 513 $ 6,627

　　　　　　　　　　 Thousands of�Millions of Yen　　　　U.S. Dollars

2009　 2008　 2009　�　Deferred tax assets:�　　Retirement benefits ¥ 17 ¥ 177 $ 173 �　　Reserve for accrued bonuses 479 531 4,877 �　　Loss on devaluation of�　　　investment securities 22 103 224 �　　Tax loss carryforwards 2,410 2,516 24,534 �　　Loss on devaluation of inventories 453 4,612 �　　Temporary difference on investment�　　　for a subsidiary 151 �　　Other 312 217 3,176 �　　Less valuation allowance (1,180) (1,912) (12,013)�　　　Total ¥ 2,513 ¥ 1,783 $ 25,583 ��　Deferred tax liabilities:�　　Roll-over relief on property,�　　　plant and equipment ¥ (192) ¥ (206) $ (1,955)�　　Net unrealized gain on �　　　available-for-sale securities (86) (236) (875)�　　Other (48) (489)�　　　Total ¥ (326) ¥ (442) $ (3,319)��　　Net deferred tax assets ¥ 2,187 ¥ 1,341 $ 22,264

　　　　　　　　　　 Thousands of�Millions of Yen　　　　U.S. Dollars

2009　 2008　 2009　�　Employees' salaries and bonuses ¥ 2,121 ¥ 2,435 $ 21,592 �　Net periodic retirement benefit costs 215 150 2,189 �　Depreciation and amortization 441 426 4,489 �　Research and development costs 1,499 1,633 15,260 �　Amortization of goodwill 38 19 387

　　　　　　2009　 2008　 2009　�　Projected benefit obligation ¥ 5,750 ¥ 6,185 $ 58,536 �　Fair value of plan assets (3,052) (3,948) (31,070)�　Unrecognized prior service cost �　　 (deduction of obligation) 140 175 1,426 �　Unrecognized actuarial loss (2,813) (1,977) (28,637)�　Prepaid pension cost 17 173 �　　Net liability ¥　 42 ¥ 435 $ 428

　　　　　　　　　　　 Thousands of �Millions of Yen　　　　　 U.S. Dollars

資料編英文2009 09.9.4 1:35 PM ページ 19

17

Consolidated Financial Statements

Sumitomo Precision Products Co., Ltd. and Consolidated Subsidiaries�Notes to Consolidated Financial Statements�

Years Ended March 31, 2009 and 2008

�　Normal effective statutory tax rate (40.6)％ (40.6)％�　　Non-tax deductible expenses 4.3 　 19.5 　�　　Tax rate difference in overseas subsidiaries (0.7)　 153.3 　�　　Per capita in local tax 1.0 　 11.6 　�　　Amortization of goodwill 0.9 　 6.1　 �　　Income in equity method (3.6)　 (91.2)　�　　Change in valuation allowance (1.8)　 346.8 　�　　Tax credit 　 (55.3)　�　　Tax on unrealized intercompany profit (1.8)　 (24.6)　�　　Temporary difference on investment　�　　　for a subsidiary (120.8)　�　　Other-net 2.5 　 (20.7)　��　Actual effective tax rate　　　 　　　　　(39.8)％ 184.1 ％��At March 31, 2009, the Company and certain subsidiaries have tax loss carryforwards aggregating approximately ¥3,759 million ($38,267 thousand) which are available to be offset against taxable income of the Company and such subsidiaries in future years. These tax loss carryforwards, if not utilized, will expire as follows:�����������In addition to above, a foreign consolidated subsidiary has non-expiring tax loss carryforwards of approximately ¥2,947 million ($30,001 thousand) at March 31, 2009.��11. RELATED PARTY TRANSACTIONS�Related party transactions for the years ended March 31, 2009 and 2008 are not disclosed because they are not material.��12. LEASES�Total lease payments under finance lease agreements that do not transfer ownership of the leased property to the Group were ¥41 million ($417 thousand) and ¥60 million for the years ended March 31, 2009 and 2008, respectively.��As discussed in Note 2.k, the Company accounts for leases which existed at the transition date and do not transfer ownership of the leased property to the lessee as operating lease transactions.��Pro forma information of such leases existing at the transition date, mainly equipment, such as acquisition cost, accumulated depreciation, obligations under finance leases and depreciation expense of those finance lease agreements on a “as if capitalized” basis for the years ended March 31, 2009 was as follows:�　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　Thousands of�　　　　　　　　　　　　　　　　　Millions of Yen 　　　　　　 U.S. Dollars � 2009 2009�Acquisition cost ￥ 　185 $ 1,884 �Accumulated depreciation 　 110 1,120 �Net leased property ￥ 　 75 $ 764 ��Obligations under finance leases are:�　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　Thousands of�　　　　　　　　　　　　　　　　　Millions of Yen 　　　　　　 U.S. Dollars � 2009 2009 �Due within one year ￥ 　 31 $ 316 �Due after one year 　 44 448 �　　Total ￥ 　 75 $ 764 ��Pro forma information of leased property, mainly equipment, such as acquisition cost, accumulated depreciation, obligations under finance leases and depreciation expense of those finance lease agreements on a “as if capitalized” basis for the years ended March 31, 2008 was as follows:�　　　　　　　　　　　　　　　　 Millions of Yen � 2008 �Acquisition cost ￥　 212 �Accumulated depreciation 104 �Net leased property 　 ￥　 108 ��

Obligations under finance leases are: ��　　　　　　　　　　　　　　　　 Millions of Yen � 2008 �Due within one year ￥　 40 �Due after one year 68 �　　Total ￥　 108 � �The amount of obligations under such finance lease agreements includes the imputed interest expense portion.��Depreciation expense, which was not reflected in the accompanying consolidated statements of operations, computed by the straight-line method was ¥41 million ($417 thousand) and ¥60 million for the years ended March 31, 2009 and 2008, respectively.��The minimum rental commitments under noncancellable operating leases at March 31, 2009 and 2008 were as follows: �　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　Thousands of�　　　　　　　　　　　　　　　　　　　Millions of Yen 　　　　　U.S. Dollars � 2009 2008 2009 �Due within one year ￥ 　 19 ￥ 21 $ 193 �Due after one year 　 14 33 143 �　　Total ￥ 　 33 ￥ 54 $ 336 ��13. DERIVATIVES�The Group enters into derivative contracts to hedge market risks such as foreign exchange and interest rate fluctuation associated with certain assets and liabilities.��It is the Group’s policy to use derivatives only for the purpose of reducing market risks associated with assets and liabilities. The Group does not hold or issue derivatives for trading purposes.��Since all of the Group’s derivative transactions are related to qualified hedges of underlying business exposures, market gain or loss risk in the derivative instruments is basically offset by opposite movements in the value of the hedged assets or liabilities.��Derivative transactions entered into by the Group have been made in accordance with internal policies which regulate the authorization and credit limit amounts. ��The fair values of the derivative contracts outstanding at March 31, 2009 were as follows:�　　　　　　　　　　　　　　　　　　　　　　　　　　 Thousands of�　　　　　　　　　　　 Millions of Yen 　　　　　 U.S. Dollars � 2009 　　　　　　　 2009 �　　　　　　　　　　　 Contract Fair Unrealized Contract Fair Unrealized�　　　　　　　　　　　 Amount Value Loss Amount Value Loss �Foreign currency forward contracts: � Selling US dollars　￥366　￥459　￥ 93　 $3,726 $4,673 $ 947 � Selling Euro 　　　￥180　￥204　￥ 24　 $1,833 $2,077 $ 244 ��At March 31, 2008, no outstanding derivative contracts existed.��Derivative contracts which qualify for hedge accounting for the year ended March 31, 2009 are excluded from the above market value information.��The contract or notional amounts of derivatives shown in the above table do not represent the amounts exchanged by the parties and do not measure the Group's exposure to credit or market risk.��Because the counterparties to these derivatives are limited to major international financial institutions, the Company does not anticipate any losses arising from credit risk.��14. CONTINGENT LIABILITIES�Contingent liabilities at March 31, 2009 were as follows:�　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　Thousands of�　　　　　　　　　　　　　　　　　　　 Millions of Yen 　 U.S. Dollars �Guarantees for borrowings by employees ￥ 　3 $ 31 ��

2009　 2008　��

　　　　　　　　　　　　　　　　　　　　　　Millions of 　　　　　Thousands of�Year Ending March 31 　　　　　　　　　　　　Yen 　　　　　　 U.S. Dollars 　　　 2010 �　　　 2011 ¥　244 $　2,484�　　　 2012 　 　�　　　 2013 　 　�　　　 2014 �　　　 2015 and thereafter 3,515 35,783�　　　 Total ¥　3,759 $　38,267

資料編英文2009 09.9.4 1:35 PM ページ 20

18

15. SEGMENT INFORMATION�The Group operates in the following industries:�Industry aerospace and hydraulic consists of propeller systems, landing gear systems, heat control systems, space equipment, hydraulic pumps, hydraulic valves and others.�Industry heat exchanger and other consists of LNG vaporizers, heat exchangers, ozone generators, semiconductor equipment and others.� �Information about operations by industry segments, geographic segments and sales to foreign customers for the years ended March 31, 2009 and 2008 is as follows:��(1) Industry Segments　　　　　　　　　　　　　　　　　　　　　　　 　　　　　　　　　　　　　　　Millions of Yen �　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　 Aerospace and　　　　 Heat Exchanger　　　　　　Elimination or�　　　　Year ended March 31, 2009 　　　　　　　　　　　　 　　　　　Hydraulic 　　　　　　and Other 　　 　　　　　Unallocated 　　　　　　Consolidated �　　　 Sales to customers �　　　 Intersegment sales�　　　　　　 Total sales�　　　 Operating expenses �　　　 Operating income (loss)�　　　 Assets �　　　 Depreciation and amortization �　　　 Capital expenditures �　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　 Millions of Yen �　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　 Aerospace and　　　　 Heat Exchanger　　　　　　Elimination or�　　　　Year ended March 31, 2008 　　　　　　　　　　　　　　 　　　Hydraulic 　　　　　　and Other 　　 　　　　　Unallocated 　　　　　　Consolidated �　　　 Sales to customers�　　　 Intersegment sales�　　　　　　 Total sales �　　　 Operating expenses �　　　 Operating income (loss) �　　　 Assets �　　　 Depreciation and amortization �　　　 Capital expenditures�　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　Thousands of U.S. Dollars �　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　 Aerospace and　　　　 Heat Exchanger　　　　　　Elimination or�　　　　Year ended March 31, 2009 　　　　　　　　　　　　　　 　　　Hydraulic 　　　　　　and Other 　　 　　　　　Unallocated 　　　　　　Consolidated �　　　 Sales to customers�　　　 Intersegment sales �　　　　　　 Total sales �　　　 Operating expenses�　　　 Operating income (loss) 　�　　　 Assets 　　　�　　　 Depreciation and amortization �　　　 Capital expenditures ��Notes: �1) As discussed in Note 2.b., effective April 1, 2008, the Company applied PITF No.18, “Practical Solution on Unification of Accounting Policies Applied to Foreign Subsidiaries for the Consolidated Financial Statements”. The effect of this change on operating income (loss) of each segment was not material. ��2) As discussed in Note 2.d., effective April 1, 2008, the Company applied ASBJ Statement No.9, “Accounting Standard for Measurement of Inventories”. The effect of this change was increase the operating loss of industry aerospace and hydraulic by ¥1,021 million ($10,394 thousand) and to decrease the operating income of industry heat exchanger and other by ¥96 million ($977 thousand) for the year ended March 31, 2009.���(2) Geographic Segments�Geographic segment information for the year ended March 31, 2009 is not disclosed because accounting principles generally accepted in Japan do not require such disclosure if sales and total assets of foreign operations represent less than 10% of the consolidated amounts.��The geographical segments of the Group for the year ended March 31, 2008 are summarized as follows:�

�　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　 　　　　　　　　　　　　　　　Millions of Yen �　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　 Elimination or�　　　　Year ended March 31, 2008 　　　　　　　　　　　　　　　　　Japan 　　　　　　　　　Others 　　 　　　　　　Unallocated 　　　　　　Consolidated �　　　 Sales to customers �　　　 Intersegment sales�　　　　　　 Total sales�　　　 Operating expenses �　　　 Operating income (loss)�　　　 Assets ��(3) Sales to Foreign Customers　　　　　　　　　　　　　　　　　 　　　　　　　　　　　　　　　　　　　　　　 Thousands of �　　　　　　　　　　　　　　　　　 　　　　　　　　　　　　　　　　　　 Millions of Yen 　　　　　　　　　　 U.S. Dollars�　　　　　　　　　　　　 　　　　　　　　　　　　　　 2009　　　　　 2008 　　　　 2009�　　　 North America �　　　 Europe �　　　 Asia �　　　 Other �　　　 　Total��16. SUBSEQUENT EVENT�At the general shareholders’ meeting held on June 26, 2009, the Company’s shareholders approved the following appropriations of retained earnings as of March 31, 2009:�　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　 　　　　　　　　　　　　　　 Thousands of�　　　　　　　　　　　　　　　　　 　　　　　　　　　　　　　 Millions of Yen 　　　　 U.S. Dollars　　　　　　　　　　　　 　　　　　　　　　�　　　Appropriations: �　　　　Cash dividends, ¥2.5 ($0.03) per share

¥ 23,530 ¥ 26,373 ¥49,903 �� 23,530 26,373 49,903 � 23,763 24,838 48,601 � ¥ (233) ¥1,535 ¥1,302 � ¥ 34,093 ¥ 27,980 ¥10,290 ¥72,363 � 1,095 911 2,006 � 2,610 1,425 4,035 ���� $ 210,150 $ 286,694 $ 496,844 �� 210,150 286,694 496,844 � 240,192 261,376 501,568 � $ (30,042) $ 25,318 $ (4,724) � $ 370,172 $ 315,800 $ 104,764 $ 790,736 � 15,290 9,356 24,646 � 40,008 30,307 70,315

¥ 7,327 ¥7,701 $ 74,590 � 4,961 5,259 50,504 � 8,854 4,672 90,135 � 297 122 3,024 � ￥21,439 ￥17,754 ＄　 218,253

¥ 133 $ 1,354

¥ 44,942 ¥ 4,961 ¥ 49,903 � 429 230 ￥ (659) � 45,371 5,191 (659) 49,903 � 42,665 6,595 (659) 48,601 � ¥ 2,706 ¥ (1,404) ¥ 1,302 � ￥ 56,467 ￥ 7,289 ￥8,607 ￥ 72,363

�

¥ 20,643 ¥ 28,162 ¥ 48,805 �� 20,643 28,162 48,805 � 23,594 25,675 49,269 � ¥ (2,951) ¥2,487 ¥ (464)� ¥ 36,362 ¥31,021 ¥ 10,291 ¥ 77,674 � 1,502 919 2,421 � 3,930 2,977 6,907

�

資料編英文2009 09.9.4 1:35 PM ページ 21

19

Consolidated Financial Statements

Sumitomo Precision Products Co., Ltd. and Consolidated Subsidiaries�Independent Auditors' Report�Years Ended March 31, 2009 and 2008

�

INDEPENDENT AUDITORS' REPORT

To the Board of Directors of Sumitomo Precision Products Co., Ltd.:��We have audited the accompanying consolidated balance sheets of Sumitomo Precision Products Co., Ltd. and consolidated subsidiaries as of March 31, 2009 and 2008, and the related consolidated statements of operations, changes in equity, and cash flows for the years then ended, all expressed in Japanese yen. These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these consolidated financial statements based on our audits. ��We conducted our audits in accordance with auditing standards generally accepted in Japan. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. ��In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the consolidated financial position of Sumitomo Precision Products Co., Ltd. and consolidated subsidiaries as of March 31, 2009 and 2008, and the consolidated results of their operations and their cash flows for the years then ended in conformity with accounting principles generally accepted in Japan.��As discussed in Note 2.d, effective April 1, 2008, the consolidated financial statements have been prepared in accordance with the new accounting standard for measurement of inventories.��Our audits also comprehended the translation of Japanese yen amounts into U.S. dollar amounts and, in our opinion, such translation has been made in conformity with the basis stated in Note 1. Such U.S. dollar amounts are presented solely for the convenience of readers outside Japan.

June 26, 2009

Elgala1-4-2, TenjinChuo-ku, Fukuoka 810-0001Japan

Tel:+81(92)751 0931Fax:+81(92)751 1035www.deloitte.com/jp

資料編英文2009 09.9.4 1:35 PM ページ 22

Susumu KAMINAGAPresident

Yasumasa NAKANISHICorporate Auditor

Koichiro KASANOSenior Corporate Auditor

Hisao SHIOTANIExecutive Vice President

Eizo YASUIManaging Director

Ikuzo MAENOManaging Director

Rinzo TOKUEExecutive Vice President

Toshiro OHASHIManaging Director

Toshiro AMANOSenior Managing Director

Kenji HIKOSOManaging Director

Masahiro MURAKAMIManaging Director

Yoshihisa NAKAMURAManaging Director

Masato MORISenior Corporate Auditor

Kazuo SADADirector

Yoshio TAOKADirector

Board of Directors and AuditorsAs of june 26,2009

In charge of Controlling & Treasury,�Information Systems,�Purchasing & Transportation,�Strategic Procuremen -Aerospace,�Corporate Environmental Control & Facilities

In charge of Industrial Hydraulic Division,�Advanced Industrial Equipment & Systems Division

In charge of MEMS & Sensor Systems,�Business Initiative & Research

In charge of Surface Technology Systems Plc.

In charge of Heat Exchangers Division

In charge of Aerospace Division,�Wireless Sensor Networks & Systems,�MEMS & Sensor Systems,�Business Initiative & Research

In charge of General Administration,�Factory Innovation Center

In charge of Sales & Marketing� -Aerospace

In charge of Thermal Control Systems� -Aerospace,�Procurement･Production･�Quality Assurance -Heat Exchangers,�Thermal Energy Systems Engineering

Directors

In charge of Controlling & Treasury In charge of Production･�Engineering & Development･Quality Assurance -Aerospace

Eiichi MORICorporate Auditor

Auditors

�

20

資料編英文2009 09.9.4 1:35 PM ページ 23

Company Outline

COMPANY OUTLINE� Established: January 1961� Paid-in capital: ¥10,311 million (as of Mar. 31, 2009)� Total plant site area: 129,842 square meters (1,398,398 square feet)�BUSINESS LOCATIONS� Head Office [Main Plant] 1-10 Fuso-cho, Amagasaki City, Hyogo, 660-0891 Japan� Phone 81-(0)6-6482-8811 Fax 81-(0)6-6489-5801� Tokyo Head Office 8th Floor, Office Tower-Y, 1-8-11, Harumi, Chuo-ku, Tokyo, 104-6108 Japan� Phone 81-(0)3-6220-0720 Fax 81-(0)3-6220-0730� Shiga Plant 1000-15 Okamoto-cho, Kusatsu City, Shiga, 525-0044 Japan� Phone 81-(0)77-564-3811 Fax 81-(0)77-564-3014� Wakayama Plant 1850 Minato, Wakayama City, Wakayama, 640-8404 Japan� Phone 81-(0)73-457-2557 Fax 81-(0)73-454-2869� Nagoya Sales Office Hishita Bldg.9F, 1-3-7 Higashi Sakura, Higashi-ku, Nagoya, 461-0005 Japan� Phone 81-(0)52-951-4991 Fax 81-(0)52-951-4993� New York Office 500 Fifth Avenue Suite 1850, New York, NY 10110 U.S.A.� Phone 1-212-354-5558 　 Fax 1-212-354-5666� Shanghai Office 1107, JiangAn Chaina Tower No.1701 West Beijing Road, Shanghai, 200040 China� Phone 86-21-6288-4747 　 Fax 86-21-6288-9829�MAIN CONSOLIDATED COMPANIES paid-in capital (millions of yen)� MET Co., Ltd. 250� 8th Floor, Office Tower-Y, 1-8-11, Harumi, Chuo-ku, Tokyo, 104-6108 Japan� Phone 81-(0)3-6220-0726 Fax 81-(0)3-6220-0736� [Manufacture of semiconductor and LCD related equipment]� Sumisei Engineering Co., Ltd. 12� 1-10 Fuso-cho, Amagasaki City, Hyogo, 660-0891 Japan� Phone 81-(0)6-6489-5893 Fax 81-(0)6-6489-5895� [Design, drawing and engineering services]� Sumisei Techno Service Co., Ltd. 20� 1-10 Fuso-cho, Amagasaki City, Hyogo, 660-0891 Japan� Phone 81-(0)6-6489-5896 Fax 81-(0)6-6489-5877� [Maintenance services for all types of industrial machinery]� Sumisei Sangyo Co., Ltd. 10� 1-10 Fuso-cho, Amagasaki City, Hyogo, 660-0891 Japan� Phone 81-(0)6-6482-3444 Fax 81-(0)6-6482-3354� [Sales of all types of materials and machinery parts]� Sumisei Hydraulic Systems Co., Ltd. 30� 2-2-27 Tsujidokandai, Fujisawa City, Kanagawa, 251-0041 Japan� Phone 81-(0)466-35-1520 Fax 81-(0)466-35-1521� [Production, maintenance and sales of aerospace and hydraulic equipment]� Surface Technology Systems Plc. (£000'S)� Imperial Park, Newport, NP10 8UJ, U.K. 8,659� Phone 44-1633-652-400 Fax 44-1633-652-405� [Production and sales of plasma processing system]� Sumitomo Precision USA, Inc. (＄)� 1639 Falcon Drive, DeSoto, Texas 75115, U.S.A. 1,000� Phone 1-972-228-9300 Fax 1-972-228-4900� ［Production and sales of heat exchangers for aerospace］�MAIN ASSOCIATED COMPANY paid-in capital� Silicon Sensing Systems Ltd. (£000'S)� No.3635234, Clittaford Road, Southway, Plymouth, Devon PL6 6DE U.K. 21,000� Phone 44-1752-723-330 Fax 44-1752-723-331� [Production and sales of motion sensors]� NINGBO SPP HYDRAULICS Co., Ltd. (YUAN)� No.507, Long jiao shan RD Beilun Ningbo China 8,038,796� Phone 86-574-8618-2701 Fax 86-574-8618-2703� [Production and sales of QT pump]� Crossbow Japan, Ltd. (millions of yen)� 1-10 Fuso-cho, Amagasaki City, Hyogo, 660-0891 Japan 30� Phone 81-(0)6-6489-5922 Fax 81-(0)6-6489-5902� [Sales of wireless sensor networks and inertial units]�Aviocast, Inc. (NT＄ 000's)� 178, Lane 20, Jhong-Jhen Road, Shalu Taichung County 433, Taiwan 13,000� Phone 886-4-2615-2215 Fax 886-4-2615-2015� [Production and sales of casting products]� Primaxx, Inc. (＄) � 7377 William Avenue, #800 Allentown. PA 18106. U.S.A. 1,300,000� Phone 1-610-336-0314 Fax 1-610-336-0455� [Production and sales of MEMS etch release equipment]��

�

�

21

資料編英文2009 09.9.4 1:35 PM ページ 24

http://www.spp.co.jp

Offices�

Head Office�

1-10 Fuso-cho, Amagasaki City, Hyogo, 660-0891 Japan�

Phone 81-(0)6-6482-8811 Fax 81-(0)6-6489-5801�

Tokyo Head Office �

8th Floor, Office Tower-Y, 1-8-11, Harumi, Chuo-ku, Tokyo 104-6108, Japan�

Phone 81-(0)3-6220-0720 Fax 81-(0)3-6220-0730�

New York Office�

500 Fifth Avenue Suite 1850, New York, NY 10110, U.S.A.�

Phone 1-212-354-5558 Fax 1-212-354-5666�

Shanghai Office�

1107,JiangAn China Tower No.1701 West Beijing Road, Shanghai, 200040 China�

Phone 86-21-6288-4747 Fax 86-21-6288-9829

資料編英文2009 09.9.4 1:34 PM ページ 1