Financial Results and Position

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Harold Derick Hicks
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1 Financial Information Consolidated Financial Results Consolidated Financial Position Reviewing the general economic decreased by 291 thousand units, or contributing to an increase in operating Net cash fl ows from operating activities environment for (April 1, %, to 8,681 thousand units in income were cost reduction efforts of resulted in an increase in cash by 4,46.8 through March 31, 216), with respect to compared with (April 1, billion yen, the eff ects of changes billion yen in. Net cash provided the world economy, the U.S. economy through March 31, 215). Vehicle unit in exchange rates of 16. billion yen, by operating activities increased by has seen ongoing recovery mainly due to sales in Japan decreased by 95 thousand and other factors of 13.4 billion yen. On billion yen from 3,685.7 billion yen in steady progress of personal consumption, units, or 4.4%, to 2,59 thousand units the other hand, the factors contributing. Net cash fl ows from investing and the European economy has seen in compared with under to a decrease in operating income were activities resulted in a decrease in cash a moderate recovery in the eurozone. the declined market in Japan. However, the increase in expenses and others by 3,182.5 billion yen in. Net cash Meanwhile, weaknesses have been with the efforts of dealers nationwide, of 34. billion yen, and the eff ects of used in investing activities decreased by seen in China and other Asian emerging Toyota and Lexus brands' market share marketing activities of 12. billion yen billion yen from 3,813.4 billion yen countries. The Japanese economy has excluding mini-vehicles was 46.8%, and Income before income taxes and equity in in. Net cash fl ows from fi nancing been on a moderate recovery as a whole, market share (including Daihatsu and earnings of affi liated companies increased activities resulted in a decrease in cash while weakness could be seen in personal Hino brands) including mini-vehicles was by 9.5 billion yen, or 3.1%, to 2,983.3 by billion yen in. Net cash consumption and other areas. 43.2%, each remaining at as high a level billion yen in compared with provided by fi nancing activities decreased For the automobile industry, although as in. Meanwhile, overseas vehicle. Net income attributable to Toyota by billion yen from 36. billion yen markets have progressed in a steady unit sales decreased by 196 thousand Motor Corporation increased by in. After taking into account the manner, especially in the U.S., markets in units, or 2.9%, to 6,622 thousand units in billion yen, or 6.4%, to 2,312.6 billion yen in eff ect of changes in exchange rates, cash some emerging countries have become compared with, because compared with. and cash equivalents increased by stagnant, and the Japanese market of decline in sales in Asia and the Middle billion yen, or 28.7%, to 2,939.4 billion yen has slowed down mainly in the sales of East despite sales expansion in North at the end of compared with the mini-vehicles due to the tax increase. America. end of. Meanwhile, the development of automated As for the results of operations, net driving technology, as well as efforts revenues increased by 1,168.5 billion yen, toward improvement in environmental or 4.3%, to 28,43.1 billion yen in friendliness and safety, has made compared with, and operating signifi cant progress. income increased by 13.4 billion yen, Under these conditions, consolidated or 3.8%, to 2,853.9 billion yen in vehicle unit sales in Japan and overseas compared with. The factors 52

2 Financial Information Consolidated Balance Sheets (March 31, 216) (March 31, 215) Increase (Decrease) (March 31, 216) (March 31, 215) Increase (Decrease) Assets Current assets 18,29,553 17,936, ,156 Cash and cash equivalents 2,939,428 2,284, ,871 Time deposits 1,32,34 149, ,713 Marketable securities 1,511,389 2,782,99 (1,27,71) Trade accounts and notes receivable, less allowance for doubtful accounts 2,,149 2,18,66 (18,511) Finance receivables, net 5,912,684 6,269,862 (357,178) Other receivables 451,46 42,78 3,698 Inventories 2,61,511 2,137,618 (76,17) Deferred income taxes 967,67 978,179 (1,572) Prepaid expenses and other current assets 1,333,345 85, ,952 Noncurrent finance receivables, net 8,642,947 9,22,531 (559,584) Investments and other assets 1,834,68 11,295,183 (46,53) Marketable securities and other securities investments 7,439,799 7,632,126 (192,327) Affi liated companies 2,631,612 2,691,46 (59,848) Employees receivables 32,998 45,26 (12,28) Other 73, ,391 (196,12) Property, plant and equipment 9,74,417 9,295, ,698 Land 1,352,94 1,354,815 (1,911) Buildings 4,311,895 4,282,839 29,56 Machinery and equipment 1,945,267 1,945,377 (11) Vehicles and equipment on operating leases 5,652,622 5,199, ,636 Construction in progress 513, ,412 (67,459) Less Accumulated depreciation (13,36,224) (13,68,71) 32,486 Total assets 47,427,597 47,729,83 (32,233) Liabilities Current liabilities 16,124,456 16,431,496 (37,4) Short-term borrowings 4,698,134 5,48,188 (35,54) Current portion of long-term debt 3,822,954 3,915,34 (92,35) Accounts payable 2,389,515 2,41,588 (21,73) Other payables 1,4, ,13 127,264 Accrued expenses 2,726,12 2,668,666 57,454 Income taxes payable 343, ,786 (5,461) Other current liabilities 1,14,131 1,126,951 (22,82) Long-term liabilities 13,214,955 13,651,5 (436,5) Long-term debt 9,772,65 1,14,395 (242,33) Accrued pension and severance costs 94,911 88,293 24,618 Deferred income taxes 2,46,89 2,298,469 (252,38) Other long-term liabilities 491,89 457,848 34,42 Total liabilities 29,339,411 3,82,51 (743,9) Mezzanine equity 479, ,779 Shareholders' equity Toyota Motor Corporation shareholders' equity 16,746,935 16,788,131 (41,196) Common stock, no par value 397,5 397,5 Additional paid-in capital 548, ,54 1,17 Retained earnings 16,794,24 15,591,947 1,22,293 Accumulated other comprehensive income (loss) 61,768 1,477,545 (866,777) Treasury stock, at cost (1,63,284) (1,225,465) (377,819) Noncontrolling interests 861, ,198 2,274 Total shareholders' equity 17,68,47 17,647,329 (38,922) Total liabilities, mezzanine equity and shareholders' equity 47,427,597 47,729,83 (32,233) Note: Mezzanine equity consists of the Model AA Class Shares, which is reported as a separate line item between Liabilities and Shareholders' equity. 53

3 Financial Information Consolidated Statements of Income Consolidated Vehicle Sales Net Revenues (For the year ended March 31, 216) (For the year ended March 31, 215) Increase (Decrease) Net revenues 28,43,118 27,234,521 1,168,597 Sales of products 26,549,111 25,612, ,275 (thousands of units) 1, 8, 6, 7,352 8,871 9,116 8,972 8,681 (billions of yen) 3, 25, 2, 18, , , , ,691.9 Financing operations 1,854,7 1,621, ,322 Costs and expenses 25,549,147 24,483,957 1,65,19 4, 15, 1, Cost of products sold 21,456,86 2,916, ,724 Cost of fi nancing operations 1,149, , ,65 Selling, general and administrative 2,943,682 2,642,281 31,41 Operating income 2,853,971 2,75,564 13,47 Other income (expense) 129,41 142,264 (12,854) Interest and dividend income 157, ,122 1,74 Interest expense (35,43) (22,871) (12,532) Foreign exchange gain (loss), net (5,573) 88,14 (93,713) Other income (loss), net 12,524 (7,127) 82,651 Income before income taxes and equity in earnings of affiliated companies 2,983,381 2,892,828 9,553 Provision for income taxes 878, ,469 (15,2) Equity in earnings of affiliated companies 329,99 38,545 2,554 Net income 2,434,211 2,37,94 126,37 Less Net income attributable to noncontrolling interests Net income attributable to Toyota Motor Corporation (121,517) (134,566) 13,49 2,312,694 2,173, ,356 Note: Net income attributable to common shareholders for the fi scal year ended March 31, 216 is 2,36,67 million yen, which is derived by deducting dividend and accretion to Model AA Class Shares of 6,87 million yen from Net income attributable to Toyota Motor Corporation. 2, FY Operating Income and Ratio of Operating Income to Net Revenues Operating income (billions of yen) 3, 2,5 2, 1,5 1, ,32.8 % to net revenues (Right scale) 8.9 2, ,75.5 2, FY (%) , Net Income Attributable to Toyota Motor Corporation and ROE Net income attributable to Toyota Motor Corporation ROE (Right scale) (billions of yen) 3, 2,5 2, 1,5 1, 5 FY , , ,312.6 (%) FY Net income attributable to Toyota Motor Corporation per common share (Yen) Basic Diluted

4 Financial Information Consolidated Statements of Cash Flows (For the year ended March 31, 216) (For the year ended March 31, 215) Cash flows from operating activities: Net income 2,434,211 2,37,94 Adjustments to reconcile net income to net cash provided by operating activities Depreciation 1,625,837 1,49,75 Provision for doubtful accounts and credit losses 159,265 78,969 Pension and severance costs, less payments 8,833 (3,161) Losses on disposal of fi xed assets 33,329 31,625 Unrealized losses on available-for-sale securities, net 9,272 2,578 Deferred income taxes 32,889 (26,887) Equity in earnings of affi liated companies (329,99) (38,545) Changes in operating assets and liabilities, and other 486,32 194,195 Net cash provided by operating activities 4,46,857 3,685,753 Cash flows from investing activities: Additions to fi nance receivables (13,549,278) (13,126,596) Collection of and proceeds from sales of fi nance receivables 13,115,854 12,45,388 Additions to fi xed assets excluding equipment leased to others (1,282,545) (1,146,318) Additions to equipment leased to others (2,776,671) (2,211,25) Proceeds from sales of fi xed assets excluding equipment leased to others 42,147 41,547 Proceeds from sales of equipment leased to others 1,111,727 83,423 Purchases of marketable securities and security investments (2,197,477) (3,194,294) Proceeds from sales of and maturity of marketable securities and security investments 3,415,815 2,683,1 Changes in investments and other assets, and other (1,62,116) (113,391) Net cash used in investing activities (3,182,544) (3,813,49) Cash flows from financing activities: Proceeds from issuance of long-term debt 4,845,872 5,29,18 Payments of long-term debt (4,176,22) (3,462,237) Decrease in short-term borrowings (1,93) (288,724) Proceeds from issuance of class shares 474,917 Dividends paid to Toyota Motor Corporation class shareholders (1,225) Dividends paid to Toyota Motor Corporation common shareholders (74,728) (554,933) Dividends paid to noncontrolling interests (73,129) (69,295) Reissuance (repurchase) of treasury stock (778,173) (347,784) Net cash provided by (used in) fi nancing activities (423,571) 36,45 Eff ect of exchange rate changes on cash and cash equivalents (199,871) 65,79 Net increase in cash and cash equivalents 654, ,387 Cash and cash equivalents at beginning of year 2,284,557 2,41,17 Cash and cash equivalents at end of year 2,939,428 2,284,557 55

5 Financial Information Segment Operating Results Automotive Net revenues for the automotive operations increased by billion yen, or 3.7%, to 25,977.4 billion yen in compared with, and operating income increased by billion yen, or 5.3%, to 2,448.9 billion yen in compared with. The increase in operating income was mainly due to cost reduction efforts and the eff ects of changes in exchange rates. Financial services Net revenues for the fi nancial services operations increased by 235. billion yen, or 14.2%, to 1,896.2 billion yen in compared with. However, operating income decreased by 22.6 billion yen, or 6.2%, to billion yen in compared with. The decrease in operating income was mainly due to the decrease in valuation gains on interest rate swaps stated at fair value in sales fi nance subsidiaries. All other Net revenues for all other businesses decreased by 78.4 billion yen, or 6.2%, to 1,177.3 billion yen in compared with. However, operating income increased by.8 billion yen, or 1.3%, to 66.5 billion yen in compared with. (As of and for the year ended March 31, 216) Automotive Financial Services All Other Inter-segment Elimination and/or Unallocated Amount Consolidated Net revenues: Sales to external customers 25,923,813 1,854,7 625,298 28,43,118 Inter-segment sales and transfers 53,63 42, ,89 (647,99) Total 25,977,416 1,896,224 1,177,387 (647,99) 28,43,118 Operating expenses 23,528,418 1,556,998 1,11,88 (647,149) 25,549,147 Operating income 2,448, ,226 66,57 (76) 2,853,971 Assets 15,621,757 21,79,1 1,917,148 8,179,682 47,427,597 Investment in equity method investees 2,532,644 9,168 1,81 78,776 2,631,389 Depreciation expenses 9, ,991 27,412 1,625,837 Capital expenditure 1,389,289 2,638,111 41,826 (1,1) 4,59,216 (As of and for the year ended March 31, 215) Automotive Financial Services All Other Inter-segment Elimination and/or Unallocated Amount Note: Unallocated corporate assets included under Inter-segment Elimination and/or Unallocated Amount for and are 9,369,868 million yen and 8,742,168 million yen, respectively, and consist primarily of funds such as cash and cash equivalents, marketable securities and portion of security investments held by TMC. Consolidated Net revenues: Sales to external customers 25,6,224 1,621,685 66,612 27,234,521 Inter-segment sales and transfers 55,95 39, ,179 (744,548) Total 25,62,129 1,661,149 1,255,791 (744,548) 27,234,521 Operating expenses 22,736,819 1,299,316 1,19,141 (742,319) 24,483,957 Operating income 2,325,31 361,833 65,65 (2,229) 2,75,564 Assets 15,897,22 22,378,941 1,889,433 7,564,434 47,729,83 Investment in equity method investees 2,588,127 8,81 1, 84,294 2,691,222 Depreciation expenses 819,28 564,619 25,176 1,49,75 Capital expenditure 1,262,67 2,86,481 39,53 (31,86) 3,357,568 56

6 Financial Information Geographic Information Japan Net revenues in Japan increased by billion yen, or 2.5%, to 14,759.4 billion yen in compared with, and operating income increased by 16. billion yen, or 6.7%, to 1,677.5 billion yen in compared with. The increase in operating income was mainly due to cost reduction eff orts and the eff ects of changes in exchange rates. North America Net revenues in North America increased by 1,374.3 billion yen, or 14.2%, to 11,51.9 billion yen in compared with. However, operating income decreased by 55.7 billion yen, or 9.5%, to billion yen in compared with. The decrease in operating income was mainly due to the increase in expenses and others, and the eff ects of changes in exchange rates. (As of and for the year ended March 31, 216) Net revenues: Japan North America Europe Asia Other Inter-segment Elimination and/or Unallocated Amount Consolidated Sales to external customers 8,588,437 1,822,772 2,57,292 4,475,623 2,8,994 28,43,118 Inter-segment sales and transfers 6,171,51 229, ,39 528,236 21,22 (7,283,744) Total 14,759,488 11,51,97 2,661,331 5,3,859 2,21,214 (7,283,744) 28,43,118 Operating expenses 13,81,966 1,523,151 2,588,915 4,554,67 2,11,35 (7,3,86) 25,549,147 Operating income 1,677, ,819 72, ,189 18,99 17,116 2,853,971 Assets 14,291,434 16,622,979 2,612,21 4,415,7 2,579,113 6,96,161 47,427,597 Europe Net revenues in Europe decreased by billion yen, or 6.6%, to 2,661.3 billion yen in compared with, and operating income decreased by 8.7 billion yen, or 1.7%, to 72.4 billion yen in compared with. (As of and for the year ended March 31, 215) Japan North America Europe Asia Other Inter-segment Elimination and/or Unallocated Amount Consolidated Asia Net revenues in Asia increased by 22.6 billion yen, or.5%, to 5,3.8 billion yen in compared with, and operating income increased by 27.4 billion yen, or 6.5%, to billion yen in compared with. The increase in operating income was mainly due to the eff ects of changes in exchange rates and cost reduction eff orts. Other (Central and South America, Oceania, Africa and the Middle East) Net revenues in other regions decreased by 239. billion yen, or 9.8%, to 2,21.2 billion yen in compared with, and operating income decreased by 2.6 billion yen, or 2.3%, to 18.9 billion yen in compared with. Net revenues: Sales to external customers 8,338,881 9,43,45 2,69,83 4,531,178 2,243,29 27,234,521 Inter-segment sales and transfers 6,64, , ,491 45,62 26,29 (7,125,714) Total 14,43,867 9,677,596 2,848,294 4,981,24 2,449,238 (7,125,714) 27,234,521 Operating expenses 12,832,391 9,93,77 2,767,176 4,559,458 2,337,729 (7,15,874) 24,483,957 Operating income 1,571, ,519 81, , ,59 (19,84) 2,75,564 Assets 14,466,432 16,961,7 2,64,54 4,753,85 2,93,474 6,4,32 47,729,83 Note: 1.Unallocated corporate assets included under Inter-segment Elimination and/or Unallocated Amount for and are 9,369,868 million yen and 8,742,168 million yen, respectively, and consist primarily of funds such as cash and cash equivalents, marketable securities and portion of security investments held by TMC. 2. Other consists of Central and South America, Oceania, Africa and the Middle East. 57

7 Financial Information Financial Summary Financial Summary (Consolidated) U.S. GAAP Fiscal years ended March Consolidated Vehicle Sales (thousands of units) 8,524 8,913 7,567 7,237 7,38 7,352 8,871 9,116 8,972 8,681 Foreign Exchange Rates (Average) Yen to US Dollar Rate Yen to Euro Rate Net Revenues (billions of yen) 23, , , , , , , , , ,43.1 Operating Income (Loss) (billions of yen) 2, ,27.3 (461.) ,32.8 2, ,75.5 2,853.9 Income (Loss) before Income Taxes (billions of yen) 2, ,437.2 (56.4) ,43.6 2,441. 2, ,983.3 Net Income (Loss) (Note 1) (billions of yen) 1,644. 1,717.8 (437.) , , ,312.6 Common Shares Cash Dividends (billions of yen) Cash Dividends per Share (yen) Payout Ratio % Value of Shares Repurchased [shareholder return] (Note 2) (billions of yen) (maximum) R&D Expenses (billions of yen) ,4.5 1,55.6 Depreciation Expenses (Note 3) (billions of yen) ,42.4 1,72.1 1, Capital Expenditures (Note 3) (billions of yen) 1, ,48.2 1, ,.7 1, ,292.5 Total Liquid Assets (Note 4) (billions of yen) 4,264. 4, , , , , , , ,58.2 9,229.9 Total Assets (billions of yen) 32, , ,62. 3, , , , , , ,427.5 Toyota Motor Corporation Shareholders' Equity (billions of yen) 11, , ,61.2 1, , , , , , ,746.9 Return on Equity % (4.) Return on Asset % (1.4) (Note 1) Shows Net income (loss) attributable to Toyota Motor Corporation (Note 2) Value of common shares repurchased (shareholder return on Net Income for the period, excluding shares constituting less than one unit that were purchased upon request and repurchases made to avoid dilution of shares) (Note 3) Figures for depreciation expenses and capital expenditures do not include vehicles in operating lease (Note 4) Excludes fi nancial subsidiaries 58

8 Corporate Information / Stock Information Corporate Information & Stock Information (As of March 31, 216) Corporate Data Company Name Toyota Motor Corporation Established August 28, 1937 Common Stock billion Fiscal Year-End March 31 Public Accounting Firm Stock Data PricewaterhouseCoopers Aarata LLC Number of Shares Authorized 1,,, shares Number of Shares Issued [Common Shares] 3,337,997,492 shares [First Series Model AA Class Shares] 47,1, shares Number of Treasury Stock 3,321,622 shares Number of Shareholders 682,82 Number of Shares per Trading Unit 1 shares Stock Listings [Japan] Tokyo, Nagoya, Osaka, Fukuoka, Sapporo [Overseas] New York, London Securities Code [Japan] 723 American Depositary Receipts (ADR) Transfer Agent in Japan Depositary and Transfer Agent for ADR Number of Affiliates Number of Employees Corporate Web Site [Consolidated Subsidiaries] 548 [Affiliates Accounted for by the Equity Method] 54 72,721 (Consolidated: 348,877) [Corporate Information] [IR Information] [Ratio] 1 ADR=2 common stocks [Symbol] TM Mitsubishi UFJ Trust and Banking Corporation 1-11, Higashisuna, 7-chome, Koutou-ku, Tokyo , Japan Japan Toll-Free: (12) The Bank of New York Mellon 11 Barclay Street, New York, NY 1286, U.S.A. Tel: (21) U.S. Toll-Free: (888) , (888) BNY-ADRS [Depositary Receipts] [Transfer Agent] Contact Points for Investors Japan U.S.A. U.K. Major Shareholders (Top 1) Name [Toyota City Head Office] 1, Toyota-cho, Toyota City, Aichi Prefecture , Japan Tel: (565) Fax: (565) [Tokyo Head Office] 4-18, Koraku 1-chome, Bunkyo-ku Tokyo , Japan Tel: (3) Fax: (3) Toyota Motor North America, Inc. 61 Lexington Avenue, 49th Floor, New York, NY 122, U.S.A. Tel: (212) Fax: (212) Toyota Motor Europe NV/SA Curzon Square, 25 Park Lane, London W1K 1RA, U.K. Tel: (27) Number of Shares Held (Thousands) Japan Trustee Services Bank, Ltd. 358,791 Toyota Industries Corporation 224,515 The Master Trust Bank of Japan, Ltd. 149,5 Nippon Life Insurance Company 12,39 State Street Bank and Trust Company (Standing proxy: Settlement & Clearing Service Division, Mizuho Bank, Ltd.) 115,23 DENSO CORPORATION 86,513 JP Morgan Chase Bank (Standing proxy: Settlement & Clearing Service Division, Mizuho Bank, Ltd.) The Bank of New York Mellon as Depositary Bank for Depositary Receipt Holders 73,483 66,933 Ownership Breakdown Other corporate entities 19.57% Individuals, etc. (including company s own shares) 21.76% Financial institutions, Brokerages 32.21% Foreign corporate entities and others 26.45% Trust & Custody Services Bank, Ltd. 64,5 Mitsui Sumitomo Insurance Company, Limited 62,63 59

Financial Strategy. Developing a Strong Financial Foundation

Financial Strategy. Developing a Strong Financial Foundation Financial Strategy Developing a Strong Financial Foundation 1. Growth: Continuous Investments for in the Future 2. Efficiency: Enhancing Profitability and Efficiency of the Balance Sheet 3. Stability: