Financial Results

for the First Half of FY2017

(April 1, 2017 - September 30, 2017)

1. Statement of income (Summary)

(Amount: million yen, comparison: %)

1H FY2016ended Sept. 30, 2016

1H FY2017ended Sept. 30, 2017

AmountComposition

ratioAmount

Composition

ratioComparisonwith last year

Net sales 11,050 100.0 12,408 100.0 12.3

Cost of sales 8,486 76.8 9,334 75.2 10.0

Gross profit 2,564 23.2 3,074 24.8 19.9

Selling, general and administrative expenses 1,487 13.5 1,543 12.4 3.7

Operating income 1,076 9.7 1,530 12.3 42.2

Non-operating income 50 0.5 51 0.4 3.0

Non-operating expenses 118 1.1 7 0.1 △93.9

Ordinary income 1,008 9.1 1,575 12.7 56.2

Extraordinary income 0 0.0 0 0.0 －

Extraordinary losses 10 0.1 18 0.1 65.1

Income taxes 309 2.8 437 3.5 41.4

Net income 688 6.2 1,120 9.0 62.7

2. Sales and profit factors

• Thermistor sensors for air conditioners increased greatly and thermistor

elements for automobiles continued strong.

Thermistor sensors for other application also increased evenly.

• The Group continued to conduct aggressive marketing activities targeting

automotive manufacturers, energy-saving and green-oriented manufacturers.

• Sales increase

• Plants full operation

• Cost reduction effect

Net sales 12,408 mil. yen +12.3% (year-to-year)

Operating income 1,530 mil. yen +42.2% (year-to-year)

Operating income margin 12.3 % 9.7%

16,490

14,546 13,099

16,548 17,086 16,143

18,757

20,113

21,261 22,071

12,408

2,457

1,214 869

2,055

1,778

849

1,366

1,889 1,663

2,394

0

1,000

2,000

3,000

4,000

5,000

0

5,000

10,000

15,000

20,000

25,000

FY2007 FY2008 FY2009 FY2010 FY2011 FY2012 FY2013 FY2014 FY2015 FY2016 FY2017

Net sales Operating income

(Mil. Yen) (Mil. Yen)）25,000

3,000(Outlook For full year)

3. Net sales and operating income

4. Balance sheet (Summary)

Mar. 31,

2017

Sept. 30,

2017Change

Current liabilities 6,581 7,343 762

Account payable 3,296 3,945 678

Short-term loan

payable709 689 △19

Others 2,569 2670 101

Noncurrent liabilities 1,189 991 △198

Long-term loan

payable772 547 △224

Others 417 433 16

Total liabilities 7,770 8,334 564

Net assets 19,343 20,029 685

Total liabilities and

net assets27,113 28,363 1,250

Mar. 31,

2017

Sept. 30,

2017Change

Current assets 18,901 19,704 802

Cash and deposits 6,348 5,808 △540

Account receivable 6,472 6,606 913

Inventory assets 5,091 5,484 393

Others 989 826 △163

Noncurrent assets 8,212 8,659 447

Property, plant and

equipment7,300 7,720 420

Intangible assets 138 130 △7

Other assets 773 807 34

Total assets 27,113 28,363 1,250

Assets Liabilities and shareholders’ equity (Mil. yen)

14,334 15,971 18,126 18,441 19,343

20,029

68.2 68.8 68.1 70.6 70.9 70.2

0

10

20

30

40

50

60

70

80

0

10,000

20,000

End of Mar. 2013 End of Mar. 2014 End of Mar. 2015 End of Mar. 2016 End of Mar. 2017 End of Sept. 2017

5. Balance sheet items

20,828 22,998 26,462 25,987 27,113

28,363

0

10,000

20,000

30,000

End of Mar. 2013 End of Mar. 2014 End of Mar. 2015 End of Mar. 2016 End of Mar. 2017 End of Sept. 2017

3,878 3,786 4,340 4,799 5,091 5,484

0

2,000

4,000

6,000

End of Mar. 2013 End of Mar. 2014 End of Mar. 2015 End of Mar. 2016 End of Mar. 2017 End of Sept. 2017

Total assets

Inventory assets

Shareholders’ equity and equity ratio

(Mil. yen)

(Mil. yen)

(Mil. yen)

6. Cash flows

-638 -430

-899

-336 -702 -900

0

900

-1,047

-497 -518 -706 -968

967 1,151 940 1,574

1,144

-80 654422

868 176

-1,400

-900

-400

100

600

1,100

1,600

Free cash flow

Cash flow used in financing activities

(Mil. yen)

(Mil. yen)

End of Sept. 2015 End of Mar. 2016 End of Sept. 2016 End of Mar. 2017 End of Sept. 2017

End of Sept. 2015 End of Mar. 2016 End of Sept. 2016 End of Mar. 2017 End of Sept. 2017

958 995 1,076 1,217 1,392 1,235 637 0

500

1,000

1,500

2,000

End of Mar. 2012 End of Mar. 2013 End of Mar. 2014 End of Mar. 2015 End of Mar. 2016 End of Mar. 2017 End of Mar. 2018

7. Capital expenditure, depreciation, R&D expenditure

1,305 2,625 1,409 1,769 1,562 1,214 0

1,000

2,000

3,000

End of Mar. 2012 End of Mar. 2013 End of Mar. 2014 End of Mar. 2015 End of Mar. 2016 End of Mar. 2017 End of Mar. 2018

219 326 331 445 435 326 0

100

200

300

400

500

End of Mar. 2012 End of Mar. 2013 End of Mar. 2014 End of Mar. 2015 End of Mar. 2016 End of Mar. 2017 End of Mar. 2018

Outlook

Outlook

Outlook

2,600

1,500

500

438

956

Capital expenditure

Depreciation

Research and development expenditure

(Mil. yen)

(Mil. yen)

(Mil. yen)

2,757

3,151

3,468

896 936

1,105

2,065

2,197

2,640

1,726

1,752

1,826

1,099

941 968

606

629

701 1,074

1,119 1,213

343 320

482

0

1,000

2,000

3,000

4,000

Sep

t. 2

01

5

Sep

t. 2

01

6

Sep

t. 2

01

7

Sep

t. 2

01

5

Sep

t. 2

01

6

Sep

t. 2

01

7

Sep

t. 2

01

5

Sep

t. 2

01

6

Sep

t. 2

01

7

Sep

t. 2

01

5

Sep

t. 2

01

6

Sep

t. 2

01

7

Sep

t. 2

01

5

Sep

t. 2

01

6

Sep

t. 2

01

7

Sep

t. 2

01

5

Sep

t. 2

01

6

Sep

t. 2

01

7

Sep

t. 2

01

5

Sep

t. 2

01

6

Sep

t. 2

01

7

Sep

t. 2

01

5

Sep

t. 2

01

6

Sep

t. 2

01

7

素子 住設機器 空調機器 家電 OA 産業機器 自動車 計測器他

8. Sales by application (based on 1H, ended September 30)

（Mil. Yen)

Thermistorelements

Householdequipment

Airconditioners

Home appliances

OA Industrial equipment

Automobiles Others

Automobiles 29.4%

Air conditioners 22.1%

HomeAppliances

16.6%

Householdequipment

OA

Industrialequipment

Others

9. Sales by application

10. FY2017 (ending March, 2018) business outlook

H1 FY2017

results

H2 FY2017

outlook

FY2017 full year

outlook

Net sales12,408 12,592 25,000

(12.3) (14.3) (13.3)

Operating income1,530 1,470 3,000

(42.2) (11.5) (25.3)

Ordinary income1,575 1,425 3,000

(56.2) (△2.1) (21.8)

Net income

attributable to

owners of the parent

1,120 1,160 2,280(62.7) (2.7) (25.4)

(Amount: mil. yen, comparison: ％)

( ): Year-to-year comparison

Plant and Equipment Investment

for the 1st half of FY2017

11. Plant and equipment investment for the 1st half of FY2017

(1) The plant in the adjacent area to Fukushima

Shibaura Electronics was reconstructed in April

2017

(3) The third building of Kakunodate Shibaura

Electronics was completed in September 2017

(2) The third building of Tohoku Shibaura

Electronics was completed in November 2017

(4) The sixth building of Thai Shibaura Denshi

will be completed at the end of April 2018

Shibaura’s

Challenges for the Future

12. Shibaura’s challenges for the future 1/2 | Achievements up to FY2016

Net sales: 20 billion yenOperating income margin: 10％

Thai Shibaura Denshi:

Completed nos. 3, 4 and 5 bldgs.

Fukushima Shibaura:

Manufacturing capacity of 30 million pieces

Fukushima Shibaura:

Thermistor elements

for high temperatures

(Matsukawa Plant)

Automatization, robots

and

for automotive field

Sales

Production capacity

Development

Technology

13. Shibaura’s Forthcoming Challenges 2/2 | Shibaura 3 years from now

Internal factors

• Further improvement of management capability

• Human resource development

• Basic development

• Application development

• Technological capability(IT systems)

• Manufacturing capability(AI and robots)

External factors

• Changes in automotive industry

• Changes in markets

(Market shrinkage in Japan)

• Communication with investors

• Supply chain

Thank you very much.

Disclaimer regarding forward-looking statements

The foregoing statements regarding future results reflect the Company‘s expectations based on

information available at the time of announcement. The information contains certain forward-

looking statements that are subject to known and unknown risks and uncertainties that could

cause actual results to differ materially from those expressed or implied by such statements.

References

Definition of terms

A thermistor is a thermally sensitive resistor generally composed of semiconductor materials, and its resistance varies significantly with temperature.

Thermistors are economical and stable, and operate in the temperature range that covers the whole range necessary for ordinary temperature control. They therefore are used in a wide range of applications.

Shibaura produces NTC (negative temperature coefficient) thermistors only. They exhibit decreasing resistance with increasing temperature, and are used in temperature detection sensors. There are also PTC (positive temperature coefficient) and CTR (critical temperature resistor) thermistors.

Thermistor

PSB thermistor element

Shibaura independently developed glass-encapsulated thermistors. With excellent thermal stability, mechanical strength and stability, they are now Shibaura’s main products.

PSB thermistors are formally patented products in major countries (Japan, the U.S., the U.K., Germany, France, Canada, Italy and Switzerland.)

<Reference>

Household

equipment

Solar system Shower toilet Water heaterHighly efficient hot

water supply system

1- 3 2 - 3 2 - 5 10 - 20

Air

conditioners

Fan heater Room A/C Industrial A/C

2 - 3 2 - 5 5 - 15

Home

appliances

Microwave oven Rice cooker Refrigerator IH cooker

2 - 3 2 - 3 2 - 8 5 - 15

OAPrinter Copy machine

Multi-functionalcopier

2 - 3 2 - 3 3 - 5

Industrial

equipment

Fire alarm Machine, robot Freezing showcase Freezing container

2 1 - 2 2 - 5 5 - 10

AutomobilesCar A/C Intake air, exhaust gas, water, fuel, oil Hybrid system

4 - 5 8 - 10 8 - 10

Number of thermistors installed in a product

<Reference>

22

1,000℃

Applications

Glass coated thermistors Glass coated thermistors for

(Existing products) high temperatures

Shibaura’s thermistors cover from -50℃ to 1,000℃

Applications for various temperature ranges<Reference>

(Tuna) stock freezer

Refrigerator

Air conditioner

EcoCute(CO2 heat pomp)

Hot-water supply

Dishwasherdryer

Automobile(Water temp.)

Rice cooker

Microwave oven

Automobile(HV & EV motors)

Copy machine

IH cooker

Fan heater

Automobile(EGR)

Oven

Household(Gas flame)

Automobile(DPF)

-50℃