10th May 2006 17:27
Toyota Motor Corporation10 May 2006 FINANCIAL SUMMARY (All financial information has been prepared in accordance with accounting principles generally accepted in the United States of America) FY2006 (April 1, 2005 through March 31, 2006) English translation from the original Japanese-language document TOYOTA MOTOR CORPORATION Cautionary Statement with Respect to Forward-Looking Statements This report contains forward-looking statements that reflect Toyota's plans andexpectations. These forward-looking statements are not guarantees of futureperformance and involve known and unknown risks, uncertainties and other factorsthat may cause Toyota's actual results, performance, achievements or financialposition to be materially different from any future results, performance,achievements or financial position expressed or implied by these forward-lookingstatements. These factors include: (i) changes in economic conditions andmarket demand affecting, and the competitive environment in, the automotivemarkets in Japan, North America, Europe and other markets in which Toyotaoperates; (ii) fluctuations in currency exchange rates, particularly withrespect to the value of the Japanese yen, the U.S. dollar, the Euro, theAustralian dollar and the British pound; (iii) Toyota's ability to realizeproduction efficiencies and to implement capital expenditures at the levels andtimes planned by management; (iv) changes in the laws, regulations andgovernment policies in the markets in which Toyota operates that affect Toyota'sautomotive operations, particularly laws, regulations and policies relating totrade, environmental protection, vehicle emissions, vehicle fuel economy andvehicle safety, as well as changes in laws, regulations and government policiesthat affect Toyota's other operations, including the outcome of futurelitigation and other legal proceedings; (v) political instability in the marketsin which Toyota operates; (vi) Toyota's ability to timely develop and achievemarket acceptance of new products; and (vii) fuel shortages or interruptions intransportation systems, labor strikes, work stoppages or other interruptions to,or difficulties in, the employment of labor in the major markets where Toyotapurchases materials, components and supplies for the production of its productsor where its products are produced, distributed or sold. A discussion of these and other factors which may affect Toyota's actualresults, performance, achievements or financial position is contained inToyota's annual report on Form 20-F, which is on file with the United StatesSecurities and Exchange Commission. This report contains summarized and condensed financial statements prepared inaccordance with accounting principles generally accepted in the United States ofAmerica. Certain prior year amounts have been reclassified to conform to thepresentations for the year ended March 31, 2006. OVERVIEW OF ASSOCIATED COMPANIES (All financial information has been prepared in accordance with accounting principles generally accepted in the United States of America) Toyota Motor Corporation ("TMC") and its associated companies (523 consolidatedsubsidiaries and 219 affiliates as of March 31, 2006) are engaged mainly in theautomotive industry and also in the financial services and other businesses. The following three business segments are segmented on the basis as stated underthe "Segment Information" according to the business category. Automotive: This business involves the design, manufacturing and distribution of sedans,minivans, compact cars, sport-utility vehicles, trucks and related parts andaccessories. Automobiles are manufactured mainly by TMC, Hino Motors, Ltd., andDaihatsu Motor Co., Ltd., but a portion of manufacturing is consigned to ToyotaAuto Body Co., Ltd. and others. Automobiles are also manufactured by ToyotaMotor Manufacturing, Kentucky, Inc. and other overseas companies. Automobileparts are manufactured by TMC, Denso Corporation and others. These products aresold through Tokyo Toyo-Pet Motor Sales Co., Ltd. and other dealers and tocertain large customers, directly by TMC. Overseas, sales are made throughToyota Motor Sales, U.S.A., Inc. and other distributors and dealers. Inaddition, Volkswagen vehicles are sold through TMC and some dealers in Japan. Financial Services: This business involves the provision of financing to support the sales ofautomobiles and other products manufactured by TMC and its associated companiesand also covers the leasing of automobiles and equipment. Toyota FinanceCorporation in Japan, Toyota Motor Credit Corporation and other overseasassociated companies provide sales financing for TMC's products and the productsof its associated companies. All other: Other business includes the design, manufacturing and sale of housing,telecommunications and other businesses. Housing is manufactured mainly by TMCand sold through Toyota Housing Corporation and housing dealers in Japan. * Consolidated subsidiaries, ** Companies accounted for under the equity method Toyota Motor Corporation Flow of products Flow of services *Hino Motors, Ltd. *Daihatsu Motor Co., Ltd. Manufacturing companies in Japan Manufacturing companies overseas \* Toyota Motor Kyushu, Inc. \* Toyota Motor Manufacturing, Kentucky, Inc.\* Toyota Motor Hokkaido, Inc. \* Toyota Motor Manufacturing, Indiana, Inc.\* Toyota Auto Body Co., Ltd. \* Toyota Motor Manufacturing Canada Inc.*Kanto Auto Works, Ltd. \* Toyota Motor Manufacturing (UK) Ltd.*\* Toyota Industries Corporation \* Toyota Motor Thailand Co., Limited**Aichi Steel Corporation \* Toyota Motor Corporation Australia Ltd.**JTEKT Corporation *PT Astra Daihatsu Motor**Aisin Seiki Co., Ltd. **New United Motor Manufacturing, Inc. etc.**Denso Corporation*\* Toyoda Gosei Co., Ltd.*\* Toyota Boshoku Corporation**Aisin AW Co., Ltd. etc. Dealers in Japan Distributors overseas \* Tokyo Toyota Motor Co., Ltd. \* Toyota Motor Sales, U.S.A., Inc.\* Tokyo Toyo-Pet Motor Sales Co., Ltd. \* Toyota Deutschland G.m.b.H.*Osaka Toyopet Co., Ltd. \* Toyota (GB) PLC\* Toyota Tokyo Corolla Co., Ltd. *Hino Motor Sales (Thailand) Ltd.\* Tokyo Hino Motors, Ltd. *Daihatsu Deutschland GmbH. etc.*Hyogo Daihatsu Hanbai Co., Ltd. etc. Financial companies * Toyota Finance Corporation * Toyota Motor Credit Corporation Dealers overseas etc. Customers Other major companies include Toyota Motor North America, Inc., which deals withpublic relations and research activities in North America, Toyota MotorManufacturing, North America, Inc., which controls manufacturing companies inNorth America, Toyota Motor Europe NV/SA, which controls manufacturing and salescompanies and deals with public relations and research activities in Europe, andToyota Financial Services Corporation, which controls the management offinancial companies. (All financial information has been prepared in accordance with accounting principles generally accepted in the United States of America) Note: JTEKT Corporation was formed on January 1, 2006 through the merger andchange of trade name of Koyo Seiko Co., Ltd. and Toyoda Machine Works, Ltd. For FY2006, the change in our major associated companies is as follows: (Change in major associated companies) Companies excluded from consolidated accounting: Toyota Motor Europe NV/SA Toyota Motor Engineering & Manufacturing Europe NV/SA Toyota Motor Europe NV/SA and Toyota Motor Engineering & Manufacturing Europe NV/SA, both of which were consolidated subsidiaries of TMC as of September 30,2005, merged into Toyota Motor Marketing Europe NV/SA, which is also aconsolidated subsidiary of TMC, as of October 1, 2005. Toyota Motor MarketingEurope NV/SA changed its trade name to Toyota Motor Europe NV/SA as of theeffective date of the merger. Toyota Motor North America, Inc., which was a consolidated subsidiary of TMC asof March 31, 2006, merged into Toyota Technical Center USA, Inc., which is alsoa consolidated subsidiary of TMC, as of April 1, 2006. Toyota Technical CenterUSA, Inc. changed its trade name to Toyota Motor North America, Inc. as of theeffective date of the merger. Toyota Motor Manufacturing North America, Inc. changed its trade name to ToyotaMotor Engineering & Manufacturing North America, Inc. as of April 1, 2006. MANAGEMENT POLICY (All financial information has been prepared in accordance with accounting principles generally accepted in the United States of America) 1. Toyota's Basic Management Policy Toyota Motor Corporation ("TMC") holds up the "Guiding Principles at ToyotaMotor Corporation" as its basic management policy and believes that efforts toachieve the goals set forth in the principles will lead to an increase incorporate value. The "Guiding Principles at Toyota Motor Corporation" are asfollows: (1) Honor the language and spirit of the law of every nation and undertake openand fair corporate activities to be a good corporate citizen of the world. (2) Respect the culture and customs of every nation and contribute to economicand social development through corporate activities in the communities. (3) Dedicate ourselves to providing clean and safe products and to enhancing thequality of life everywhere through all our activities. (4) Create and develop advanced technologies and provide outstanding productsand services that fulfill the needs of customers worldwide. (5) Foster a corporate culture that enhances individual creativity and teamworkvalue, while honoring mutual trust and respect between labor and management. (6) Pursue growth in harmony with the global community through innovativemanagement. (7) Work with business partners in research and creation to achieve stable,long-term growth and mutual benefits, while keeping ourselves open to newpartnerships. 2. Basic Policy on the Distribution of Profits TMC deems the benefit of its shareholders as one of its priority managementpolicies and strives to continuously increase per-share earnings, throughpromoting its business aggressively while improving and strengthening itscorporate foundations. With respect to the payment of dividends, TMC seeks toenhance the distribution of profits by striving to raise the consolidateddividend payout ratio, with the aim of increasing it to 30% over the medium- tolong-term, while giving due consideration to factors such as the businessresults of each term and new investment plans. Furthermore, we acquire treasurystock to improve capital efficiency and respond appropriately to changes in thebusiness environment. As we anticipate the continued growth in worldwide automotive markets, we willutilize our internal funds to invest in improvement of product performance anddevelopment of next-generation technologies to achieve future growth, to developproduction and sales networks domestically and overseas for further expansion ofour global business and to expand into new business areas, while securing solidmanagement foundation. At TMC's 102nd ordinary general shareholders' meeting, which is scheduled to beheld on June 23, 2006, a proposal will be submitted to the shareholders torevise the articles of incorporation to allow retained earnings to bedistributed in the form of dividends by resolution of the board of directors toimplement flexible capital policies in accordance with the business environment. As in the past, two dividends will be declared each year - an interimdividend and a year-end dividend - and in order to secure an opportunityto seek shareholders' input, year-end dividends will be a matter for resolutionat the ordinary general shareholders' meeting. 3. Views and Policies on Reducing the Number of Shares per Unit of Investment TMC reduced the number of shares per investment unit from 1,000 shares to 100shares on August 1, 2000 to increase the liquidity of TMC shares and expand thebase of TMC investors. TMC will continuously consider setting an appropriateunit of investment, taking into consideration, among other things, for TMC'sshare price, turnover, the number of shareholders and the needs of investors. (All financial information has been prepared in accordance with accounting principles generally accepted in the United States of America) 4. Policy for the Granting of Stock Options and Other Incentive Plans Currently, TMC maintains an incentive plan for granting stock options to ourdirectors, managing officers and senior managers, etc. Together with this plan,TMC also maintains an incentive plan for the executives of its overseasassociated companies. TMC believes that these incentive plans will heighten their willingness andmotivation to improve business performance in the medium- and long-term, enhanceinternational competitiveness and profitability, and contribute to increasedcorporate value. 5. Medium- and Long-term Management Strategy To continue its growth over the long-term, the Toyota Group will make combinedefforts to address the following agenda. Immediate agenda in Japan include the continued introduction of the Lexus brand,and the reinforcement of sales network through further clarification of thechannel identities of Toyota, Toyopet, Corolla, and Netz dealer channels.Overseas, in North America, Europe, Asia, and other regions, Toyota Group isworking diligently towards the successful commencement of production at newplants, and through further development of the foundation of production,purchasing, and sales structures, promote corporate activities that are rootedin the local regions. Medium- to long-term strategies include, first of all, focus on development ofcutting-edge technologies and their use in products to continue providingcustomers around the world with products that are environmentally-friendly,safe, comfortable, and attractive. Second, the entire Toyota Group is makingconcerted efforts to maintain and improve the world's highest levels of qualityand strengthen our cost competitiveness, and build optimal business structuresin order to achieve a balance between growth and efficiency. In addition,Toyota strives to be a company with energy and dignity that fulfills its socialresponsibilities by carrying out corporate social responsibility (CSR)activities through philanthropic activities undertaken from a global perspectiveand thorough corporate ethics including full compliance with applicable laws andregulations. The origin of corporate competitiveness is the development ofhuman resources, and Toyota is training the highly-creative personnel that willpass on Toyota's manufacturing technologies, skills and values to the nextgeneration. By addressing these agenda, Toyota is working to enhance its corporate value asa company that can compete successfully on a global scale and maintain growth inharmony with society rooted in "manufacturing" over 21st century. 6. Matters relating to parent companies Not applicable. BUSINESS RESULTS AND FINANCIAL POSITION (All financial information has been prepared in accordance with accounting principles generally accepted in the United States of America) 1. Summary of Consolidated Financial Results for FY2006 (1) Financial Results During FY2006, the Japanese economy recovered moderately with higher capitalexpenditure resulting from improved corporate revenues as well as personalconsumption steadily bottoming-out. Overseas, economic conditions were steadyoverall, with higher capital expenditure and personal consumption in the UnitedStates of America and with continuing high growth rates in Asian economy,particularly in China. Under these conditions, consolidated vehicle sales in Japan and overseasincreased by 566 thousand units, or 7.6%, to 7,974 thousand units in FY2006compared with FY2005 (April 1, 2004 through March 31, 2005), marking a recordhigh. While vehicle sales in Japan decreased by 17 thousand units, or 0.7%, itcontinues to maintain a high level of 2,364 thousand units in FY2006, as aresult of the sales efforts of dealers in Japan. Overseas vehicle salesincreased significantly in all regions by 583 thousand units, or 11.6%, to 5,610thousand units in FY2006 compared with FY2005. As for the results of operations for FY2006, net revenues increased by 2,485.4billion yen, or 13.4%, to 21,036.9 billion yen in FY2006 compared with FY2005,and operating income increased by 206.2 billion yen, or 12.3%, to 1,878.3billion yen in FY2006 compared with FY2005. Among the factors contributing tothe increase in operating income totaling 670.0 billion yen, were the effects ofchanges in exchange rates of 300.0 billion yen, marketing efforts of 240.0billion yen and cost reduction efforts of 130.0 billion yen. On the other hand,factors resulting in the decrease in operating income primarily included adecrease in the gains recognized on the transfer of the substitutional portionof the employee pension fund to the government of 47.2 billion yen and anincrease in expenses of 416.6 billion yen. Income before income taxes, minorityinterest and equity in earnings of affiliated companies increased by 332.7billion yen, or 19.0%, to 2,087.3 billion yen in FY2006 compared with FY2005.Net income increased by 200.9 billion yen, or 17.2%, to 1,372.1 billion yen inFY2006 compared with FY2005. (All financial information has been prepared in accordance with accounting principles generally accepted in the United States of America) (2) Cash Flows Cash flows from operating activities resulted in an increase in cash by 2,515.4billion yen in FY2006, mainly due to net income of 1,372.1 billion yen. Netcash provided by operating activities increased by 144.5 billion yen from2,370.9 billion yen in FY2005. Cash flows from investing activities resulted ina decrease in cash by 3,375.5 billion yen in FY2006, mainly due to the additionsto finance receivables of 6,476.9 billion yen. Net cash used in investingactivities increased by 314.4 billion yen from 3,061.1 billion yen in FY2005.Cash flows from financing activities resulted in an increase in cash by 876.9billion yen in FY2006. Net cash provided by financing activities increased by457.6 billion yen from 419.3 billion yen in FY2005. After consideration of theeffect of exchange rate changes, cash and cash equivalents increased by 85.6billion yen, or 5.8%, to 1,569.3 billion yen at the end of FY2006 compared withthe end of FY2005. Regarding the consolidated cash flows by segment for FY2006, in non-financialservices business, net cash provided by operating activities was 2,022.5 billionyen, net cash used in investing activities was 1,673.5 billion yen and net cashused in financing activities was 313.3 billion yen. Meanwhile, in the financialservices business, net cash provided by operating activities was 583.9 billionyen, net cash used in investing activities was 1,813.8 billion yen and net cashprovided by financing activities was 1,211.0 billion yen. 2. Consolidated Financial Results for FY2006 by Segment (1) Segment Operating Results Automotive: Net revenues for the automotive operations increased by 2,224.6 billion yen, or13.0%, to 19,338.1 billion yen in FY2006 compared with FY2005, and operatingincome increased by 241.5 billion yen, or 16.6%, to 1,694.0 billion yen inFY2006 compared with FY2005. The increase in operating income was mainly due tothe effects of changes in exchange rates, increases in both production volumeand vehicle units sold, and the effects of cost reduction efforts, partiallyoffset by a decrease in the gains recognized on the transfer of thesubstitutional portion of the employee pension fund to the government andincreases in expenses. Financial services: Net revenues for the financial services operations increased by 215.7 billionyen, or 27.6%, to 996.9 billion yen in FY2006 compared with FY2005, whileoperating income decreased by 45.0 billion yen, or 22.4%, to 155.8 billion yenin FY2006 compared with FY2005. The decrease in operating income was mainlybecause of the valuation losses on interest rate swaps stated at fair value inaccordance with the Statement of Financial Accounting Standards (FAS) No. 133(as amended by several guidance including FAS No. 138), as well as the gain inFY2005 to record prior-year adjustments relating to accounting for loanorigination costs in accordance with FAS No. 91 by a sales finance subsidiary inthe United States of America, despite a steady increase in financing volumes. All other: Net revenues for all other businesses increased by 160.0 billion yen, or 15.5%,to 1,190.3 billion yen in FY2006 compared with FY2005, and operating incomeincreased by 6.0 billion yen, or 17.8%, to 39.7 billion yen in FY2006 comparedwith FY2005. (All financial information has been prepared in accordance with accounting principles generally accepted in the United States of America) (2) Geographic Information Japan: Net revenues in Japan increased by 1,107.4 billion yen, or 9.2%, to 13,111.5billion yen in FY2006 compared with FY2005, and operating income increased by88.7 billion yen, or 9.0%, to 1,075.9 billion yen in FY2006 compared withFY2005. The increase in operating income was mainly due to the effects ofchanges in exchange rates and the effects of cost reduction efforts, partiallyoffset by a decrease in the gains recognized on the transfer of thesubstitutional portion of the employee pension fund to the government andincreases in expenses. North America: Net revenues in North America increased by 1,314.5 billion yen, or 20.6%, to7,687.9 billion yen in FY2006 compared with FY2005, and operating incomeincreased by 48.1 billion yen, or 10.7%, to 495.6 billion yen in FY2006 comparedwith FY2005. The increase in operating income was mainly due to solidperformance as a result of increases in both local production volume and vehicleunits sold, as well as cost reduction efforts. Europe: Net revenues in Europe increased by 248.0 billion yen, or 10.0%, to 2,727.4billion yen in FY2006 compared with FY2005, while operating income decreased by14.6 billion yen, or 13.4%, to 93.9 billion yen in FY2006 compared with FY2005.The decrease in operating income was mainly due to an increase in expenses,partially offset by increases in both local production volume and vehicle unitssold. Asia: Net revenues in Asia increased by 417.4 billion yen, or 25.7%, to 2,042.8billion yen in the FY2006 compared with FY2005, and operating income increasedby 51.7 billion yen, or 55.2%, to 145.5 billion yen in the FY2006 compared withFY2005. The increase in operating income was mainly due to increases in bothlocal production volume and vehicle units sold, which resulted from thefavorable sales of IMV series vehicles. Other: Net revenues in other markets increased by 418.0 billion yen, or 35.3 %, to1,601.7 billion yen in FY2006 compared with FY2005, and operating incomeincreased by 19.8 billion yen, or 41.6%, to 67.2 billion yen in FY2006 comparedwith FY2005. The increase in operating income was primarily due to increases inlocal production volumes as well as vehicle units sold, mainly IMV seriesvehicles. 3. Distribution of Profits for FY2006 As for the dividends, in addition to the increase in interim dividends declaredin November 2005 by 10 yen per share to 35 yen per share, TMC plans to increasethe year-end dividends by 15 yen per share to 55 yen per share. As a result, ona full-year basis, the dividends will be 90 yen per share, which is 25 yenhigher than in the previous year, and the consolidated dividend payout ratio forFY2006 would be 21.3%. On the other hand, during FY2006, TMC repurchased 27 million of its own sharesat an aggregate cost of 133,640 million yen. (All financial information has been prepared in accordance with accounting principles generally accepted in the United States of America) 4. Forecast of Financial Results for FY2007 Although we expect gradual growth in the world economy in the future, we face avariety of unstable elements, including concerns about the future Americaneconomy and high oil prices worldwide. The Japanese economy is on a recoverytrend, but troubling factors such as higher prices for raw materials andfluctuations in exchange rates still remain. In the automobile industry, automakers from around the world are expanding development of next-generationtechnologies that address issue of environment, safety, and energy, includingthe large scale introduction of hybrid vehicles, and competition is expected tobecome even more intense in the future. Under these circumstances, current forecast of financial results for the nextfiscal year ending March 2007 is set forth below. This forecast assumes averageexchange rates through the fiscal year of 110 yen per US$1 and 135 yen per 1euro. Forecast of consolidated results for FY2007 Net revenues 22,300.0 billion yen (an increase of 6.0% compared with FY2006)Operating income 1,900.0 billion yen (an increase of 1.2% compared with FY2006)Income before income taxes, 1,970.0 billion yen (a decrease of 5.6% compared with FY2006)minority interest and equity inearnings of affiliatedcompaniesNet income 1,310.0 billion yen (a decrease of 4.5% compared with FY2006) These forward-looking statements are not guarantees of future performance andinvolve known and unknown risks, uncertainties and other factors that may causeToyota's actual results, performance, achievements or financial position to bematerially different from any future results, performance, achievements orfinancial position expressed or implied by these forward-looking statements. When using forecast of financial results, please refer to the CautionaryStatement with Respect to Forward-Looking Statements in the Financial Summary onthe inside cover. CONSOLIDATED PRODUCTION AND SALES (All financial information has been prepared in accordance with accounting principles generally accepted in the United States of America) 1. Production (Units) FY2006 FY2005 Increase (April 2005 through (April 2004 through (Decrease) March 2006) March 2005)Vehicles Japan 4,684,956 4,534,838 150,118(new) North America 1,201,459 1,156,166 45,293 Europe 622,552 595,874 26,678 Asia 835,669 647,559 188,110 Other 367,011 297,539 69,472 Overseas total 3,026,691 2,697,138 329,553 Total 7,711,647 7,231,976 479,671Houses (Japan) 5,269 5,115 154 Note: The total production of vehicles (new) includes 763,573 units ofDaihatsu brand vehicles (including OEM production) in FY2006 and 745,745 unitsin FY2005, and 100,018 units of Hino brand vehicles (including OEM production)in FY2006 and 93,470 units in FY2005 . 2. Sales (by destination) (Units) FY2006 FY2005 Increase (April 2005 through (April 2004 through (Decrease) March 2006) March 2005)Vehicles Japan 2,364,484 2,381,325 (16,841)(new) North America 2,556,050 2,271,139 284,911 Europe 1,022,781 978,963 43,818 Asia 880,661 833,507 47,154 Other 1,150,587 943,444 207,143 Overseas total 5,610,079 5,027,053 583,026 Total 7,974,563 7,408,378 566,185Houses (Japan) 5,525 5,283 242 Note: The total sales of vehicles (new) includes 711,757 units of Daihatsubrand vehicles in FY2006 and 703,497 units in FY2005, and 102,474 units of Hinobrand vehicles in FY2006 and 95,318 units in FY2005. BREAKDOWN OF CONSOLIDATED NET REVENUES (All financial information has been prepared in accordance with accounting principles generally accepted in the United States of America) (Amounts are rounded to the nearest million yen) FY2006 FY2005 Increase (April 2005 through (April 2004 through (Decrease) March 2006) March 2005) Vehicles 16,584,317 14,803,255 1,781,062 Parts & components for overseas 298,492 236,592 61,900 production Parts 1,311,617 1,091,673 219,944 Other 1,131,190 966,895 164,295Total Automotive 19,325,616 17,098,415 2,227,201Financial services 977,416 760,664 216,752Housing 138,103 136,100 2,003Telecommunications 51,485 44,661 6,824Other 544,289 511,686 32,603Total 21,036,909 18,551,526 2,485,383 Note: The amounts represent net revenues to external customers. CONSOLIDATED STATEMENTS OF INCOME (All financial information has been prepared in accordance with accounting principles generally accepted in the United States of America) (Amounts are rounded to the nearest million yen) FY2006 FY2005 Increase (April 2005 through (April 2004 through (Decrease) March 2006) March 2005) Net revenues : 21,036,909 18,551,526 2,485,383 Sales of products 20,059,493 17,790,862 2,268,631 Financing operations 977,416 760,664 216,752Costs and expenses : 19,158,567 16,879,339 2,279,228 Cost of products sold 16,335,312 14,500,282 1,835,030 Cost of financing operations 609,632 369,844 239,788 Selling, general and administrative 2,213,623 2,009,213 204,410Operating income 1,878,342 1,672,187 206,155Other income (expense) : 209,018 82,450 126,568 Interest and dividend income 93,970 67,519 26,451 Interest expense (21,601) (18,956) (2,645) Foreign exchange gain, net 10,789 21,419 (10,630) Other income, net 125,860 12,468 113,392Income before income taxes, minority interest 2,087,360 1,754,637 332,723and equity in earnings of affiliated companiesProvision for income taxes 795,153 657,910 137,243Income before minority interest and equity in 1,292,207 1,096,727 195,480earnings of affiliated companiesMinority interest in consolidated subsidiaries (84,393) (64,938) (19,455)Equity in earnings of affiliated companies 164,366 139,471 24,895Net income 1,372,180 1,171,260 200,920 (Yen) Net income per share - Basic 421.76 355.35 66.41Net income per share - Diluted 421.62 355.28 66.34 CONSOLIDATED BALANCE SHEETS (All financial information has been prepared in accordance with accounting principles generally accepted in the United States of America) (Amounts are rounded to the nearest million yen) FY2006 FY2005 Increase (As of March 31, 2006) (As of March 31, 2005) (Decrease) AssetsCurrent assets: 10,735,222 9,440,105 1,295,117 Cash and cash equivalents 1,569,387 1,483,753 85,634 Time deposits 50,349 63,609 (13,260) Marketable securities 634,879 543,124 91,755 Trade accounts and notes receivable, 1,980,680 1,813,725 166,955 less allowance for doubtful accounts Finance receivables, net 3,497,319 3,010,135 487,184 Other receivables 416,336 355,381 60,955 Inventories 1,620,975 1,306,709 314,266 Deferred income taxes 520,494 475,764 44,730 Prepaid expenses and other current assets 444,803 387,905 56,898Noncurrent finance receivables, net 4,830,216 3,976,941 853,275Investments and other assets: 6,099,529 5,122,371 977,158 Marketable securities and other securities 3,402,523 2,704,142 698,381 investments Affiliated companies 1,828,369 1,570,185 258,184 Employees receivables 75,094 49,538 25,556 Other 793,543 798,506 (4,963)Property, plant and equipment: 7,066,628 5,795,594 1,271,034 Land 1,215,897 1,182,768 33,129 Buildings 3,156,613 2,935,274 221,339 Machinery and equipment 8,482,832 7,897,509 585,323 Vehicles and equipment on operating leases 2,605,426 1,828,697 776,729 Construction in progress 397,076 214,781 182,295 Less - Accumulated depreciation (8,791,216) (8,263,435) (527,781) Total assets 28,731,595 24,335,011 4,396,584 (All financial information has been prepared in accordance with accounting principles generally accepted in the United States of America) (Amounts are rounded to the nearest million yen) FY2006 FY2005 Increase (As of March 31, 2006) (As of March 31, 2005) (Decrease) LiabilitiesCurrent liabilities: 10,028,735 8,227,206 1,801,529 Short-term borrowings 3,033,019 2,381,827 651,192 Current portion of long-term debt 1,723,888 1,150,920 572,968 Accounts payable 2,086,587 1,856,799 229,788 Other payables 730,184 693,041 37,143 Accrued expenses 1,464,263 1,289,373 174,890 Income taxes payable 347,488 292,835 54,653 Other current liabilities 643,306 562,411 80,895Long-term liabilities: 7,552,831 6,557,926 994,905 Long-term debt 5,640,490 5,014,925 625,565 Accrued pension and severance costs 679,918 646,989 32,929 Deferred income taxes 1,092,995 811,670 281,325 Other long-term liabilities 139,428 84,342 55,086 Total liabilities 17,581,566 14,785,132 2,796,434 Minority interest in consolidated subsidiaries 589,580 504,929 84,651 Shareholders' equity Common stock 397,050 397,050 - Additional paid-in capital 495,250 495,707 (457) Retained earnings 10,459,788 9,332,176 1,127,612 Accumulated other comprehensive income 437,316 (80,660) 517,976 (loss) Treasury stock, at cost (1,228,955) (1,099,323) (129,632) Total shareholders' equity 10,560,449 9,044,950 1,515,499 Total liabilities and shareholders' equity 28,731,595 24,335,011 4,396,584 CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY (All financial information has been prepared in accordance with accounting principles generally accepted in the United States of America) (1) FY2006 (April 2005 through March 2006) (Amounts are rounded to the nearest million yen) Common Additional Retained Accumulated Treasury Total stock paid-in earnings other stock, shareholders' capital comprehensive at cost equity income (loss) Balances at March 31, 2005 397,050 495,707 9,332,176 (80,660) (1,099,323) 9,044,950Issuance during the year (457) (457)Comprehensive income: Net income 1,372,180 1,372,180 Other comprehensive income Foreign currency 268,410 268,410 translation adjustments Unrealized gains on 244,629 244,629 securities, net of reclassification adjustments Minimum pension liability 4,937 4,937 adjustments Total comprehensive income 1,890,156Dividends paid (244,568) (244,568)Purchase and reissuance of common (129,632) (129,632) stockBalances at March 31, 2006 397,050 495,250 10,459,788 437,316 (1,228,955) 10,560,449 (2) FY2005 (April 2004 through March 2005) (Amounts are rounded to the nearest million yen) Common Additional Retained Accumulated Treasury Total stock paid-in earnings other stock, shareholders' capital comprehensive at cost equity income (loss) Balances at March 31, 2004 397,050 495,179 8,326,215 (204,592) (835,285) 8,178,567Issuance during the year 528 528Comprehensive income: Net income 1,171,260 1,171,260 Other comprehensive income Foreign currency 75,697 75,697 translation adjustments Unrealized gains on 38,455 38,455 securities, net of reclassification adjustments Minimum pension liability 9,780 9,780 adjustments Total comprehensive income 1,295,192Dividends paid (165,299) (165,299)Purchase and reissuance of common (264,038) (264,038) stockBalances at March 31, 2005 397,050 495,707 9,332,176 (80,660) (1,099,323) 9,044,950 CONSOLIDATED STATEMENTS OF CASH FLOWS (All financial information has been prepared in accordance with accounting principles generally accepted in the United States of America) (Amounts are rounded to the nearest million yen) FY2006 FY2005 (April 2005 through (April 2004 through March 2006) March 2005) Cash flows from operating activities :Net income 1,372,180 1,171,260Adjustments to reconcile net income to net cash provided by operating activitiesDepreciation 1,211,178 997,713Provision for doubtful accounts and credit losses 62,646 63,154Pension and severance costs, less payments 23,860 (52,933)Loss on disposal of fixed assets 54,981 49,159Unrealized losses on available-for-sale securities, net 4,163 2,324Deferred income taxes 33,262 84,711Minority interest in consolidated subsidiaries 84,393 64,938Equity in earnings of affiliated companies (164,366) (139,471)Changes in operating assets and liabilities and other (166,817) 130,085 Net cash provided by operating activities 2,515,480 2,370,940 Cash flows from investing activities :Additions to finance receivables (6,476,979) (5,594,375)Collection of and proceeds from sales of finance receivables 5,718,130 4,674,919Additions to fixed assets excluding equipment leased to others (1,523,459) (1,068,287)Additions to equipment leased to others (1,247,781) (854,953)Proceeds from sales of fixed assets excluding equipment 89,578 69,396 leased to othersProceeds from sales of equipment leased to others 410,683 316,456Purchases of marketable securities and security investments (957,296) (1,165,791)Proceeds from sales of and maturity of marketable securities 691,032 573,943 and security investmentsPayment for additional investments in affiliated companies, (1,802) (901) net of cash acquiredChanges in investments and other assets and other (77,606) (11,603) Net cash used in investing activities (3,375,500) (3,061,196) Cash flows from financing activities :Purchase of common stock (129,629) (264,106)Proceeds from issuance of long-term debt 1,928,788 1,863,710Payments of long-term debt (1,187,506) (1,155,223)Increase in short-term borrowings 509,826 140,302Dividends paid (244,568) (165,299) Net cash provided by financing activities 876,911 419,384Effect of exchange rate changes on cash and cash equivalents 68,743 24,849Net increase (decrease) in cash and cash equivalents 85,634 (246,023)Cash and cash equivalents at beginning of year 1,483,753 1,729,776Cash and cash equivalents at end of year 1,569,387 1,483,753 Note: In the Consolidated Statements of Cash Flows, cash and cash equivalentsinclude cash on hand, bank deposits that can be withdrawn at any time andshort-term investments that can be converted into cash at any time and carryminimal risk of change in value. SEGMENT INFORMATION (All financial information has been prepared in accordance with accounting principles generally accepted in the United States of America) 1. Segment Operating Results and Assets (1) FY2006 (April 2005 through March 2006) (Amounts are rounded to the nearest million yen) Automotive Financial All Other Intersegment Consolidated Services Elimination and/or Unallocated AmountNet revenues:(1) Sales to external 19,325,616 977,416 733,877 - 21,036,909customers(2) Intersegment sales 12,528 19,493 456,414 (488,435) -and transfers Total 19,338,144 996,909 1,190,291 (488,435) 21,036,909Operating expenses 17,644,099 841,092 1,150,543 (477,167) 19,158,567Operating income 1,694,045 155,817 39,748 (11,268) 1,878,342Assets 12,354,827 11,613,508 1,191,261 3,571,999 28,731,595Investment in equity 1,459,556 287,326 - 73,835 1,820,717method investeesDepreciation expenses 880,360 301,734 29,084 - 1,211,178Capital expenditure 1,615,814 1,110,191 45,282 (47) 2,771,240 (2) FY2005 (April 2004 through March 2005) (Amounts are rounded to the nearest million yen) Automotive Financial All Other Intersegment Consolidated Services Elimination and/or Unallocated AmountNet revenues:(1) Sales to external 17,098,415 760,664 692,447 - 18,551,526customers(2) Intersegment sales 15,120 20,597 337,873 (373,590) -and transfers Total 17,113,535 781,261 1,030,320 (373,590) 18,551,526Operating expenses 15,661,000 580,408 996,577 (358,646) 16,879,339Operating income 1,452,535 200,853 33,743 (14,944) 1,672,187Assets 11,141,197 9,487,248 1,025,517 2,681,049 24,335,011Investment in equity 1,271,044 215,642 - 75,746 1,562,432method investeesDepreciation expenses 754,339 220,584 22,790 - 997,713Capital expenditure 1,161,757 726,777 50,555 (15,849) 1,923,240 Note: Unallocated corporate assets included under "Intersegment Eliminationand/or Unallocated Amount" for FY2006 and FY2005 are 4,231,148 million yen and3,308,055 million yen, respectively, and consist primarily of funds such as cashand cash equivalents, marketable securities and portion security investmentsheld by TMC. (All financial information has been prepared in accordance with accounting principles generally accepted in the United States of America) 2. Consolidated Financial Statements as Classified into Non-Financial ServicesBusiness and Financial Services Business (1) Consolidated Statements of Income as Classified into Non-Financial ServicesBusiness and Financial Services Business (Amounts are rounded to the nearest million yen) FY2006 FY2005 Increase (April 2005 through (April 2004 through (Decrease) March 2006) March 2005) (Non-financial services)Net revenues 20,068,284 17,800,357 2,267,927Costs and expenses: 18,328,868 16,310,540 2,018,328 Cost of revenues 16,335,340 14,497,252 1,838,088 Selling, general and administrative 1,993,528 1,813,288 180,240Operating income 1,739,416 1,489,817 249,599Other income, net 201,978 68,736 133,242Income before income taxes, 1,941,394 1,558,553 382,841minority interest and equity in earningsof affiliated companiesProvision for income taxes 736,909 578,709 158,200Income before minority interest and equity in 1,204,485 979,844 224,641earnings of affiliated companiesMinority interest in consolidated subsidiaries (82,401) (63,952) (18,449)Equity in earnings of affiliated companies 142,139 131,849 10,290Net income 1,264,223 1,047,741 216,482 (Financial services)Net revenues 996,909 781,261 215,648Costs and expenses: 841,092 580,408 260,684 Cost of revenues 613,563 376,150 237,413 Selling, general and administrative 227,529 204,258 23,271Operating income 155,817 200,853 (45,036)Other expenses, net (9,859) (4,764) (5,095)Income before income taxes, minority interest 145,958 196,089 (50,131)and equity in earnings ofaffiliated companiesProvision for income taxes 58,241 78,748 (20,507)Income before minority interest and equity in 87,717 117,341 (29,624)earnings of affiliated companiesMinority interest in consolidated subsidiaries (1,992) (988) (1,004)Equity in earnings of affiliated companies 22,227 7,622 14,605Net income 107,952 123,975 (16,023) (Elimination)Elimination of net income 5 (456) 461 (Consolidated)Net income 1,372,180 1,171,260 200,920 (All financial information has been prepared in accordance with accounting principles generally accepted in the United States of America) (2) Consolidated Balance Sheets as Classified into Non-Financial ServicesBusiness and Financial Services Business (Amounts are rounded to the nearest million yen) FY2006 FY2005 Increase (As of March 31, 2006) (As of March 31, 2005) (Decrease) Assets (Non-financial services)Current assets: 7,154,653 6,401,152 753,501 Cash and cash equivalents 1,418,022 1,324,126 93,896Time deposits 14,024 8,006 6,018Marketable securities 633,036 541,785 91,251 Trade accounts and notes receivable, 2,002,577 1,837,539 165,038 less allowance for doubtful accounts Inventories 1,620,975 1,306,709 314,266 Prepaid expenses and other current 1,466,019 1,382,987 83,032 assets Investments and other assets 5,702,376 4,804,843 897,533Property, plant and equipment 5,207,760 4,579,052 628,708 Total 18,064,789 15,785,047 2,279,742 (Financial services)Current assets: 4,361,374 3,836,650 524,724 Cash and cash equivalents 151,365 159,627 (8,262) Time deposits 36,325 55,603 (19,278) Marketable securities 1,843 1,339 504 Finance receivables, net 3,497,319 3,010,135 487,184 Prepaid expenses and other current 674,522 609,946 64,576 assets Noncurrent finance receivables, net 4,830,216 3,976,941 853,275Investments and other assets 563,050 457,115 105,935Property, plant and equipment 1,858,868 1,216,542 642,326 Total 11,613,508 9,487,248 2,126,260 (Elimination) Elimination of assets (946,702) (937,284) (9,418) (Consolidated) Total assets 28,731,595 24,335,011 4,396,584 Note: Assets in the non-financial services include unallocated corporate assets. (All financial information has been prepared in accordance with accounting principles generally accepted in the United States of America) (Amounts are rounded to the nearest million yen) FY2006 FY2005 Increase (As of March 31, 2006) (As of March 31, 2005) (Decrease) Liabilities (Non-financial services)Current liabilities: 5,774,891 5,139,351 635,540 Short-term borrowings 797,969 713,474 84,495 Current portion of long-term debt 68,299 60,092 8,207 Accounts payable 2,084,399 1,847,036 237,363 Accrued expenses 1,357,335 1,200,122 157,213 Income taxes payable 328,360 263,291 65,069 Other current liabilities 1,138,529 1,055,336 83,193 Long-term liabilities: 2,230,611 1,957,404 273,207 Long-term debt 730,072 747,911 (17,839) Accrued pension and severance costs 676,999 645,308 31,691 Other long-term liabilities 823,540 564,185 259,355 Total 8,005,502 7,096,755 908,747 (Financial services)Current liabilities: 5,040,058 3,789,503 1,250,555 Short-term borrowings 2,932,799 2,269,197 663,602 Current portion of long-term debt 1,662,589 1,092,328 570,261 Accounts payable 9,273 15,542 (6,269) Accrued expenses 111,133 93,042 18,091 Income taxes payable 19,128 29,544 (10,416) Other current liabilities 305,136 289,850 15,286 Long-term liabilities: 5,483,284 4,836,755 646,529 Long-term debt 5,071,482 4,503,247 568,235 Accrued pension and severance costs 2,919 1,681 1,238 Other long-term liabilities 408,883 331,827 77,056 Total 10,523,342 8,626,258 1,897,084 (Elimination) Elimination of liabilities (947,278) (937,881) (9,397) (Consolidated) Total liabilities 17,581,566 14,785,132 2,796,434 (Consolidated) Minority interest in consolidated 589,580 504,929 84,651 subsidiaries Shareholders' equity (Consolidated)Common stock 397,050 397,050 -Additional paid-in capital 495,250 495,707 (457)Retained earnings 10,459,788 9,332,176 1,127,612Accumulated other 437,316 (80,660) 517,976 comprehensive income (loss)Treasury stock, at cost (1,228,955) (1,099,323) (129,632) Total shareholders' equity 10,560,449 9,044,950 1,515,499 (Consolidated) Total liabilities and shareholders' equity 28,731,595 24,335,011 4,396,584 (All financial information has been prepared in accordance with accounting principles generally accepted in the United States of America) (3) Consolidated Statements of Cash Flows as Classified into Non-FinancialServices Business and Financial Services Business (Amounts are rounded to the nearest million yen) FY2006 FY2005 (April 2005 through (April 2004 through March 2006) March 2005) (Non-financial services) Cash flows from operating activities:Net income 1,264,223 1,047,741Adjustments to reconcile net income to net cash provided byoperating activitiesDepreciation 909,444 777,129Provision for doubtful accounts and credit losses 10,361 15,752 Pension and severance costs, less payments 22,664 (53,401) Loss on disposal of fixed assets 54,614 48,334 Unrealized losses on available-for-sale securities, net 4,163 2,324 Deferred income taxes 31,370 29,398 Minority interest in consolidated subsidiaries 82,401 63,952 Equity in earnings of affiliated companies (142,139) (131,849) Changes in operating assets and liabilities and other (214,507) (97,535) Net cash provided by operating activities 2,022,594 1,701,845 Cash flows from investing activities:Additions to fixed assets excluding equipment leased to others (1,516,658) (1,049,572)Additions to equipment leased to others (144,391) (146,891)Proceeds from sales of fixed assets excluding equipment leased to 81,950 60,034othersProceeds from sales of equipment leased to others 112,692 84,450Purchases of marketable securities and security investments (764,016) (1,053,417)Proceeds from sales of and maturity of marketable securities and 561,948 471,614 security investmentsPayment for additional investments in affiliated companies, net of (1,802) (901) cash acquiredChanges in investments and other assets and other (3,292) 84,979 Net cash used in investing activities (1,673,569) (1,549,704) Cash flows from financing activities:Purchase of common stock (129,629) (264,106)Proceeds from issuance of long-term debt 33,904 27,363Payments of long-term debt (59,778) (59,689)Decrease in short-term borrowings 86,731 564Dividends paid (244,568) (165,299)Other - (7,000) Net cash used in financing activities (313,340) (468,167)Effect of exchange rate changes on cash and cash equivalents 58,211 21,276Net increase (decrease) in cash and cash equivalents 93,896 (294,750)Cash and cash equivalents at beginning of year 1,324,126 1,618,876Cash and cash equivalents at end of year 1,418,022 1,324,126 (All financial information has been prepared in accordance with accounting principles generally accepted in the United States of America) (Amounts are rounded to the nearest million yen) FY2006 FY2005 (April 2005 through (April 2004 through March 2006) March 2005) (Financial services) Cash flows from operating activities: Net income 107,952 123,975 Adjustments to reconcile net income to net cash provided by operating activitiesDepreciation 301,734 220,584Provision for doubtful accounts and credit losses 52,285 47,402Pension and severance costs, less payments 1,196 468Loss on disposal of fixed assets 367 825Deferred income taxes 1,889 54,860Minority interest in consolidated subsidiaries 1,992 988Equity in earnings of affiliated companies (22,227) (7,622)Changes in operating assets and liabilities and other 138,766 203,762 Net cash provided by operating activities 583,954 645,242 Cash flows from investing activities:Additions to finance receivables (11,407,390) (9,562,203)Collection of and proceeds from sales of finance receivables 10,545,425 8,586,796Additions to fixed assets excluding equipment leased to others (6,801) (18,715)Additions to equipment leased to others (1,103,390) (708,062)Proceeds from sales of fixed assets excluding equipment leased to 7,628 9,362 othersProceeds from sales of equipment leased to others 297,991 232,006Purchases of marketable securities and security investments (193,280) (112,374)Proceeds from sales of and maturity of marketable securities and 129,084 102,329security investmentsChanges in investments and other assets and other (83,104) (16,485) Net cash used in investing activities (1,813,837) (1,487,346) Cash flows from financing activities:Proceeds from issuance of long-term debt 1,930,823 1,862,012Payments of long-term debt (1,233,336) (1,160,710)Increase in short-term borrowings 513,602 178,956Other - 7,000 Net cash provided by financing activities 1,211,089 887,258Effect of exchange rate changes on cash and cash equivalents 10,532 3,573Net increase (decrease) in cash and cash equivalents (8,262) 48,727Cash and cash equivalents at beginning of year 159,627 110,900Cash and cash equivalents at end of year 151,365 159,627 (Consolidated)Effect of exchange rate changes on cash and cash equivalents 68,743 24,849Net increase (decrease) in cash and cash equivalents 85,634 (246,023)Cash and cash equivalents at beginning of year 1,483,753 1,729,776Cash and cash equivalents at end of year 1,569,387 1,483,753 Note: In the Consolidated Statements of Cash Flows, cash and cash equivalentsinclude cash on hand, bank deposits that can be withdrawn at any time andshort-term investments that can be converted into cash at any time and carryminimal risk of change in value. (All financial information has been prepared in accordance with accounting principles generally accepted in the United States of America) 3. Geographic Information (1) FY2006 (April 2005 through March 2006) (Amounts are rounded to the nearest million yen) Japan North Europe Asia Other Intersegment Consolidated America Elimination and/or Unallocated AmountNet revenues:(1) Sales to 7,735,109 7,455,818 2,574,014 1,836,855 1,435,113 - 21,036,909external customers(2) Intersegment 5,376,348 232,124 153,395 205,951 166,623 (6,134,441) -sales and transfers Total 13,111,457 7,687,942 2,727,409 2,042,806 1,601,736 (6,134,441) 21,036,909Operating expenses 12,035,567 7,192,304 2,633,462 1,897,260 1,534,546 (6,134,572) 19,158,567Operating income 1,075,890 495,638 93,947 145,546 67,190 131 1,878,342Assets 12,177,125 9,199,818 2,471,258 1,255,350 1,299,072 2,328,972 28,731,595 (2) FY2005 (April 2004 through March 2005) (Amounts are rounded to the nearest million yen) Japan North Europe Asia Other Intersegment Consolidated America Elimination and/or Unallocated AmountNet revenues:(1) Sales to 7,408,136 6,187,624 2,305,450 1,572,113 1,078,203 - 18,551,526external customers(2) Intersegment 4,596,019 185,829 173,977 53,309 105,499 (5,114,633) -sales and transfers Total 12,004,155 6,373,453 2,479,427 1,625,422 1,183,702 (5,114,633) 18,551,526Operating expenses 11,016,913 5,925,894 2,370,886 1,531,650 1,136,248 (5,102,252) 16,879,339Operating income 987,242 447,559 108,541 93,772 47,454 (12,381) 1,672,187Assets 10,740,796 7,738,898 2,242,566 945,635 998,172 1,668,944 24,335,011 Note: Unallocated corporate assets included under "Intersegment Eliminationand/or Unallocated Amount" for FY2006 and FY2005 are 4,231,148 million yen,3,308,055 million yen , respectively, and consist primarily of funds such ascash and cash equivalents, marketable securities and portion of securityinvestments held by TMC. (All financial information has been prepared in accordance with accounting principles generally accepted in the United States of America) 4. Overseas Sales (1) FY2006 (April 2005 through March 2006) (Amounts are rounded to the nearest million yen) North America Europe Asia Other TotalOverseas sales 7,687,738 2,607,819 2,005,777 2,721,981 15,023,315Consolidated sales - - - - 21,036,909Ratio of overseas sales % % % % %to consolidated sales 36.6 12.4 9.5 12.9 71.4 (2) FY2005 (April 2004 through March 2005) (Amounts are rounded to the nearest million yen) North America Europe Asia Other TotalOverseas sales 6,374,235 2,365,525 1,776,554 2,089,210 12,605,524Consolidated sales - - - - 18,551,526Ratio of overseas sales % % % % %to consolidated sales 34.4 12.8 9.6 11.2 68.0 UNCONSOLIDATED STATEMENTS OF INCOME (All financial information has been prepared in accordance with accounting principles generally accepted in Japan) (Million yen; amounts less than one million yen are omitted) FY2006 FY2005 Increase (April 2005 through (April 2004 through (Decrease) March 2006) March 2005)Net sales 10,191,838 9,218,386 973,452Cost of sales 8,248,627 7,506,044 742,583Selling, general and administrative expenses 1,095,212 1,010,951 84,261 Operating income 847,998 701,390 146,608Non-operating income 342,165 273,440 68,725 Interest income 18,686 15,765 2,921 Dividend income 228,670 152,083 76,587 Other non-operating income 94,808 105,591 (10,783)Non-operating expenses 85,382 118,598 (33,216) Interest expenses 10,715 10,729 (14) Other non-operating expenses 74,666 107,869 (33,203) Ordinary income 1,104,781 856,231 248,550Extraordinary losses - 24,996 (24,996) - 24,996 (24,996) Impairment losses 1,104,781 831,235 273,546 Income before income taxesIncome taxes - current 354,100 281,700 72,400Income taxes - deferred (15,279) 20,205 (35,484)Net income 765,961 529,329 236,632Unappropriated retained earnings broughtforward 512,778 497,867 14,911Loss on sales of treasury stock 388 184 204Interim cash dividends 113,844 82,049 31,795Unappropriated retained earningsat end of year 1,164,506 944,962 219,544 PROPOSED APPROPRIATION OF UNCONSOLIDATED RETAINED EARNINGS (All financial information has been prepared in accordance with accounting principles generally accepted in Japan) (Million yen except 'per share' amounts; amounts less than one million yen are omitted) FY2006 FY2005Unappropriated retained earnings at end of year 1,164,506 944,962Reversal of reserve for losses on overseas 33 55investmentsReversal of reserve for reduction of 24 -acquisition cost of fixed assetsTotal 1,164,564 945,018 The proposed appropriation is as follows: Cash dividends 178,296 130,723 (JPY55 per share) (JPY40 per share) Bonuses to directors 676 614Bonuses to corporate auditors 51 51Reserve for special depreciation 830 739Reserve for reduction of acquisition cost of - 111fixed assetsGeneral reserve 400,000 300,000Unappropriated retained earnings to be carried 584,710 512,778forward Note: An interim dividend of JPY35 per share was paid on November 25, 2005, toshareholders (including the beneficial shareholders notified by JapaneseSecurities Depository Center) or registered pledgees, listed on theshareholders' record as of September 30, 2005. Total interim dividends paidwere in amount of 113,844 million yen. UNCONSOLIDATED BALANCE SHEETS (All financial information has been prepared in accordance with accounting principles generally accepted in Japan) (Million yen; amounts less than one million yen are omitted) FY2006 FY2005 Increase (As of March 31,2006) (As of March 31,2005) (Decrease) AssetsCurrent assets 3,795,723 3,453,441 342,282 Cash and deposits 107,674 60,275 47,399 Trade accounts receivable 1,206,641 1,088,735 117,906 Marketable securities 922,033 870,735 51,298 Finished goods 147,413 116,864 30,549 Raw materials 27,336 14,747 12,589 Work in process 109,970 82,069 27,901 Supplies 8,177 8,091 86 Short-term loans 476,766 511,757 (34,991) Deferred income taxes 259,372 248,110 11,262 Other 536,835 459,153 77,682 Less: allowance for doubtful (6,500) (7,100) 600 accounts Fixed assets 6,113,286 5,617,550 495,736 Property, plant and equipment 1,279,608 1,258,835 20,773 Buildings 377,018 371,515 5,503 Structures 40,401 41,537 (1,136) Machinery and equipment 291,186 314,168 (22,982) Vehicle and delivery equipment 13,663 16,109 (2,446) Tools, furniture and fixtures 88,795 83,012 5,783 Land 385,886 388,658 (2,772) Construction in progress 82,656 43,834 38,822 Investments and other assets 4,833,678 4,358,714 474,964 Investments in securities 2,314,903 1,817,556 497,347 Investments in subsidiaries and 1,945,521 1,931,634 13,887 affiliates Long-term loans 476,422 362,951 113,471 Deferred income taxes - 129,571 (129,571) Other 127,430 140,600 (13,170) Less: allowance for doubtful accounts (30,600) (23,600) (7,000)Total assets 9,909,010 9,070,991 838,019 (All financial information has been prepared in accordance with accounting principles generally accepted in Japan) (Million yen; amounts less than one million yen are omitted) FY2006 FY2005 Increase (As of March 31,2006) (As of March 31,2005) (Decrease) LiabilitiesCurrent liabilities 2,379,900 2,180,374 199,526 Trade notes payable 1,117 1,375 (258) Trade accounts payable 1,044,613 909,108 135,505 Current portion of bonds - 600 (600) Other payables 393,585 401,464 (7,879) Income taxes payable 218,256 144,730 73,526 Accrued expenses 491,032 443,165 47,867 Deposits received 207,254 250,648 (43,394) Allowance for EXPO 2005 Aichi - 67 (67) Other 24,040 29,214 (5,174) Long-term liabilities 842,213 832,806 9,407 Bonds 500,000 500,000 - Allowance for retirement benefits 288,961 289,694 (733) Deferred income taxes 24,798 - 24,798 Other 28,454 43,111 (14,657)Total liabilities 3,222,114 3,013,181 208,933 Shareholders' equityCommon stock 397,049 397,049 -Capital surplus 416,970 416,970 - Capital reserve 416,970 416,970 -Retained earnings 6,614,868 6,094,528 520,340 Legal reserve 99,454 99,454 - Reserve for losses on overseas 197 252 (55) investments Reserve for special depreciation 3,196 2,457 739 Reserve for reduction of 6,586 6,475 111 acquisition cost of fixed assets General reserve 5,340,926 5,040,926 300,000 Unappropriated retained earnings 1,164,506 944,962 219,544 at end of yearNet unrealized gains on other securities 518,155 279,780 238,375Less: treasury stock (1,260,148) (1,130,519) (129,629)Total shareholders' equity 6,686,895 6,057,810 629,085 Total liabilities and shareholders' equity 9,909,010 9,070,991 838,019 This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
Toyota Motor