FY2016 Consolidated Financial and Operating Results<JGAAP> (Overview English translation of the Japanese original) April 27, 2016

FY2016 Consolidated Financial and Operating Results<JGAAP> (Overview English translation of the Japanese original) April 27, 2016 Company Name: SANYO DENKI CO., LTD. Code Number: 6516 (Listed on the First Section of the Tokyo Stock Exchange) (URL: http://www.sanyodenki.co.jp/) Representative: Shigeo Yamamoto, President & CEO Contact: Kanichiro Tamokami, Operating Officer for Administration, Manager of Accounting Department Phone: (03) 5927-1020 Scheduled date for the Ordinary General Meeting of Shareholders: June 15, 2016 Scheduled date for commencement of dividend payments: June 16, 2016 Scheduled date for submitting the Securities Report: June 15, 2016 Availability of supplementary briefing material on annual results: Yes Schedule of annual results briefing session: Yes (For analysts) (Amounts below one million yen are truncated.) 1. Overview of the Consolidated Financial and Operating Results for FY2016 (from April 1, 2015 to March 31, 2016) (1) Consolidated operating results (% indicates changes from the previous term) Profit attributable to Net sales Operating income Ordinary income owners of parent Million % Million % Million % Million % FY2016 80,282 (12.5) 5,342 (28.6) 5,387 (35.9) 3,685 (35.6) FY2015 91,745 35.6 7,478 55.1 8,409 56.6 5,720 53.4 Note: Comprehensive income: FY2016: 1,606 million (-79.1%) FY2015: 7,698 million (23.9%) Basic earnings per share Diluted earnings per share Rate of return on equity Ratio of ordinary income to total assets Ratio of operating income to net sales Yen Yen % % % FY2016 59.34 7.1 6.2 6.7 FY2015 92.09 11.7 10.0 8.2 (Reference) Equity in earnings of affiliates: FY2016: million FY2015: million In preparation of consolidated financial statements until FY2014, necessary adjustments for consolidated accounting had been made with using the financial statements of 14 overseas consolidated subsidiaries as of three months before. We have changed our method to use the financial statements of the overseas consolidated subsidiaries for the same period as ours, beginning from FY2015. Therefore, the consolidated statements of income for the previous fiscal year include the three-month results from January 1 to March 31, 2014 of the overseas consolidated subsidiaries. As a result, documents are provided in Analysis of Operating Results on page 5 of these documents which allow for comparison between the results for FY2016 and the twelve-month results of the consolidated statements of income for FY2015 that exclude the results of overseas consolidated subsidiaries from January 1 to March 31, 2014. (2) Consolidated financial position Total assets Net assets Equity ratio Net assets per share Million Million % Yen FY2016 84,945 52,099 61.3 838.80 FY2015 90,176 51,618 57.2 830.94 (Reference) Equity: FY2016: 52,092 million FY2015: 51,612 million (3) Consolidated cash flows Cash flows from operating activities Cash flows from investing activities Cash flows from financing activities Cash and cash equivalents at end of year Million Million Million Million FY2016 4,863 (2,057) (2,708) 12,743 FY2015 5,801 (3,587) (3,352) 13,151 1

2. Dividends Annual cash dividend per share Total amount of cash 1Q 2Q 3Q 4Q Annual dividends (Annual) Yen Yen Yen Yen Yen Million FY2015 8.00 9.00 17.00 1,055 FY2016 9.00 9.00 18.00 1,117 FY2017 (Forecast) 9.00 9.00 18.00 Payout ratio (Consolidated) Ratio of dividends to net assets (Consolidated) % % FY2015 18.5 2.2 FY2016 30.3 2.2 FY2017 (Forecast) 24.3 3. Forecast for FY2017 (from April 1, 2016 to March 31, 2017) (% indicates changes from the previous corresponding term) Basic Profit attributable to Net sales Operating income Ordinary income earnings per owners of parent share Million % Million % Million % Million % Yen Interim period 39,300 (2.7) 2,900 (4.7) 2,900 (7.7) 2,000 2.1 32.20 Full year 82,300 2.5 6,700 25.4 6,700 24.4 4,600 24.8 74.07 4. Others (1) Significant changes in subsidiaries during FY2016: None (Change of certain subsidiaries that involves the scope of consolidation) (2) Changes in accounting policies, changes in accounting estimates, and restatements of prior period financial statements after error corrections 1) Changes in accounting policies due to revisions to accounting standards: Exists 2) Changes in accounting policies due to other than 1): Exists 3) Changes in accounting estimates: Exists 4) Restatement of prior period financial statements after error corrections: None (3) Number of issued shares (common shares) 1) Number of issued shares at the end of the period FY2016 (including ) 64,860,935 shares FY2015 64,860,935 shares 2) Number of at the end of the period FY2016 2,757,424 shares FY2015 2,748,132 shares 3) Average number of shares during the period FY2016 62,107,090 shares FY2015 62,115,156 shares 2

(Reference) Summary of the Non-consolidated Financial and Operating Results 1. Overview of the Non-consolidated Financial and Operating Results for FY2016 (from April 1, 2015 to March 31, 2016) (1) Non-consolidated operating results (% indicates changes from the previous term) Net sales Operating income Ordinary income Profit Million % Million % Million % Million % FY2016 60,301 (11.5) 2,851 (42.6) 3,516 (40.4) 2,272 (42.4) FY2015 68,102 24.5 4,969 68.9 5,898 68.0 3,948 65.8 Basic earnings per share Diluted earnings per share Yen Yen FY2016 36.60 FY2015 63.57 (2) Non-consolidated financial position Total assets Net assets Equity ratio Net assets per share Million Million % Yen FY2016 60,430 39,117 64.7 629.87 FY2015 65,805 38,076 57.9 613.02 (Reference) Equity: FY2016: 39,117 million FY2015: 38,076 million 2. Forecast Non-consolidated Performance for FY2017 (from April 1, 2016 to March 31, 2017) (% indicates changes from the previous corresponding term) Net sales Ordinary income Profit Basic earnings per share Million % Million % Million % Yen Interim period 30,400 (1.7) 2,100 (15.7) 1,500 (20.5) 24.15 Full year 64,000 6.1 4,500 28.0 3,200 40.8 51.53 *Status of execution of the audit procedures of financial results The audit procedures under the Financial Instruments and Exchange Act have not been completed at the time of the disclosure of these financial results. *Explanation for the appropriate use of performance forecasts and other special notes Statements in these reports regarding the next fiscal year and other future events are evaluations made based upon the information available at the time these reports were prepared and believed to be reasonable. Therefore, they do not constitute a guarantee that they will be realized. Accordingly, actual results may vary significantly from the forecast results stated here for a number of factors. 3

Table of Contents 1. Analyses of Operating Results and Financial Position... 5 (1) Analysis of Operating Results... 5 (2) Analysis of Financial Position... 7 (3) Dividend Policy and Payments for the Current Fiscal Year and the Next Fiscal Year... 8 2. Overview of the Group... 9 3. Management Policies... 11 (1) Basic Management Policies of the Company... 11 (2) Management Targets... 11 (3) Medium- to Long-Term Business Strategies of the Company... 11 (4) Issues to be Addressed by the Company... 12 (5) Other Important Matters for Management of the Company... 12 4. Basic Policy on Selection of Accounting Standards... 12 5. Consolidated Financial Statements... 13 (1) Consolidated Balance Sheets... 13 (2) Consolidated Statements of Income and Comprehensive Income... 15 (3) Consolidated Statements of Changes in Net Assets... 17 (4) Consolidated Statements of Cash Flows... 19 (5) Notes to the Consolidated Financial Statements... 21 (Notes on Going Concern Assumption)... 21 (Important Matters that Form the Basis for Preparing Consolidated Financial Statements)... 21 (Omission of Disclosure)... 21 (Changes in Accounting Policies)... 21 (Changes in Accounting Policies that Are Difficult to Distinguish from Changes in Accounting Estimates)... 21 (Segment Information, etc.)... 22 (Per Share Information)... 26 (Material Subsequent Events)... 26 6. Non-consolidated Financial Statements... 27 (1) Non-consolidated Balance Sheets... 27 (2) Non-consolidated Statements of Income... 30 (3) Non-consolidated Statements of Changes in Net Assets... 31 (4) Notes to the Non-consolidated Financial Statements... 37 (Notes on Going Concern Assumption)... 37 7. Others... 37 (1) Changes in Directors and Corporate Auditors... 37 4

1. Analyses of Operating Results and Financial Position (1) Analysis of Operating Results During the fiscal year under review, the Japanese economy remained stagnant due to such factors as weakness in domestic demand and slowdown in the Chinese economy. Under such circumstances, the demand from the equipment industries, including machine tools and robots, which are the Group s main clients, was significantly sluggish. As a result, consolidated net sales totaled 80,282 million in the fiscal year under review, down 12.5% from the previous year. Consolidated operating income decreased by 28.6% to 5,342 million and consolidated ordinary income declined by 35.9% to 5,387 million, while profit attributable to owners of parent amounted to 3,685 million, down 35.6%. Order intake decreased by 15.9% to 79,460 million, while the backlog of orders decreased by 27.9% to 11,904 million. In preparation of consolidated financial statements so far, necessary adjustments for consolidated accounting have been made with using the financial statements of 14 overseas consolidated subsidiaries as of three months before. In order to prepare the most up-to-date consolidated financial statements, we have changed our method to use the financial statements of the overseas consolidated subsidiaries for the same period as ours, beginning from FY2015. Therefore, the actual results for the previous fiscal year include the three-month results from January 1 to March 31, 2014 of the overseas consolidated subsidiaries. The comparison between the actual results for the fiscal year under review and the actual results for the previous fiscal year that exclude the results of the overseas consolidated subsidiaries from January 1 to March 31, 2014 is as shown in the following table: FY2016 Actual Results FY2015 Actual Results January - March 2014 Actual Results for Overseas Consolidated Subsidiaries FY 2015 Actual Results (After Adjustment) Year on Year Change After Adjustment Net Sales 80,282 91,745 4,641 87,104 (7.8%) Operating Income 5,342 7,478 434 7,043 (24.2%) Ordinary Income 5,387 8,409 425 7,984 (32.5%) Profit Attributable to Owners of Parent 3,685 5,720 313 5,406 (31.8%) Segment operating results by geographical area are as follows (Note 1): 1) Japan Companies operating in Japan are the Company and its consolidated subsidiaries: SANYO KOGYO CO., LTD. and SANYO DENKI Techno Service CO., LTD. Segment sales amounted to 80,124 million, down 9.0% from the previous year. Segment profit decreased by 34.0% to 3,816 million. 2) North America The Company has a consolidated subsidiary in North America: SANYO DENKI AMERICA, INC. Segment sales decreased by 11.1% to 8,208 million. Segment profit decreased by 4.7% to 227 million. 3) Europe The Company s consolidated subsidiaries operating in Europe are SANYO DENKI EUROPE S.A. and SANYO DENKI GERMANY GmbH. Segment sales went down by 17.8% to 4,609 million. Segment profit decreased by 43.1% to 299 million. 4) East Asia The Company s consolidated subsidiaries operating in East Asia include SANYO DENKI SHANGHAI 5

CO., LTD., SANYO DENKI (H.K.) CO., LIMITED, SANYO DENKI TAIWAN CO., LTD., SANYO DENKI KOREA CO., LTD., SANYO DENKI ENGINEERING (Shanghai) CO., LTD., which is a subsidiary of SANYO DENKI SHANGHAI CO., LTD., as well as SANYO DENKI (Shenzhen) CO., LTD., SANYO DENKI (Zhongshan) CO., LTD. and SANYO DENKI ENGINEERING (Shenzhen) CO., LTD., all of which are subsidiaries of SANYO DENKI (H.K.) CO., LIMITED. Segment sales decreased by 23.2% to 11,769 million. Segment profit decreased by 91.6% to 52 million. 5) Southeast Asia The Company s consolidated subsidiaries operating in Southeast Asia include SANYO DENKI PHILIPPINES, INC., SANYO DENKI SINGAPORE PTE. LTD., and SANYO DENKI INDIA PRIVATE LIMITED as well as SANYO DENKI (THAILAND) CO., LTD., which is a subsidiary of SANYO DENKI SINGAPORE PTE. LTD. Segment sales decreased by 18.4% to 16,463 million. Segment profit increased by 22.1% to 627 million. (Note 1): With regard to the segment sales and segment profit from 2) to 5) above, the year-on-year change between the twelve-month operating results for the previous fiscal year that exclude the results of the overseas consolidated subsidiaries from January 1 to March 31, 2014 and the operating results for the fiscal year under review is as following: Segment sales: North America: up 11.4% Europe: up 1.9% East Asia: down 11.3% Southeast Asia: down 0.3% Segment profit: North America: up 49.0% Europe: down 29.3% East Asia: down 90.4% Southeast Asia: up 73.0% The general state of business by division is as follows (Note 2): 1) Cooling Systems Division As for San Ace, which is Sanyo Denki s brand name for cooling system products, demand was higher in the telecommunications industry and servers for data centers. Conversely, demand for mounters and machine tools in the factory automation industry, and demand for power conditioners for photovoltaic generation within the environmental industry decreased. As a result, net sales decreased by 9.9% year on year to 21,212 million. The amount of orders received dropped by 9.2% to 21,477 million, and the order backlog increased by 9.0% to 3,197 million. 2) Power Systems Division Among our products under the brand name of SANUPS for power supply equipment, demand for power conditioners declined because grid connection negotiations for photovoltaic generation were prolonged in many cases. As a result, net sales decreased by 21.8% year on year to 11,204 million, the amount of orders received dropped by 20.3% to 11,179 million, and the order backlog decreased by 1.1% to 2,260 million. 3) Servo Systems Division As for SANMOTION, which is the brand name for servo systems, demand from domestic and overseas manufacturers of machine tools, injection molding machines and robots declined significantly, due to the slowdown in the Chinese economy. Conversely, demand for semiconductor manufacturing equipment was strong, due to an increase in capital expenditure. Consequently, net sales went down by 16.0% year on year to 35,813 million, the amount of orders received decreased by 21.9% to 34,479 million, and the order backlog dropped by 21.4% to 4,896 million. 4) Electrical Equipment Sales Division Sales of industrial electrical equipment, control equipment and electronic materials were slightly 6

weak for such sectors as industrial machines, and demand from machine tools, robots and medical devices sectors were also stagnant. On the other hand, demand for photovoltaic generation control panels for overseas was strong, leading to a considerable growth in sales. In iron and steel-related business sectors, demand for the renewal of aged equipment was solid. Concerning transactions that are made as an agent, net sales and cost of sales were previously recorded as total amounts until FY2015, but beginning in the first quarter of the fiscal year under review, we changed the method to recording net amount of net sales and cost of sales. As a result, net sales increased by 14.0% year on year to 9,681 million, the amount of orders received dropped by 1.1% to 9,813 million, and the order backlog decreased by 82.1% to 793 million. 5) Electrical Works Contracting Division With respect to factory equipment in steel mills, the volume of renewal work and repair work carried out exceeded the initial plan, buoyed by an increase in demand. Conversely, with regard to demand for the construction of photovoltaic generation equipment, both orders and sales decreased due to declined purchase price for photovoltaic power. As a result, net sales decreased by 14.3% year on year to 2,370 million, the amount of orders received dropped by 7.4% to 2,511 million, and the order backlog increased by 22.8% to 757 million. (Note 2): With regard to net sales and the amount of orders received by division from 1) to 3) above, the year-on-year change between the twelve-month operating results for the previous fiscal year that exclude the results of the overseas consolidated subsidiaries from January 1 to March 31, 2014 and the operating results for the fiscal year under review is as following: Net sales: Cooling Systems Division: down 0.9% Power Systems Division: down 21.5% Servo Systems Division: down 10.8% Amount of orders received: Cooling Systems Division: down 0.2% Power Systems Division: down 20.0% Servo Systems Division: down 17.3% As for the outlook for the next fiscal year, although there are concerns about deflation observed in Europe and deceleration in the Chinese economy, the economy will likely continue on a recovery path, supported by factors such as domestic demand due to economic measures and increased capital investment in line with a recovery in corporate earnings. Amid such an environment, the Group will continue activity for globalization of the entire corporate activities and will continuously promote the production and sale of the industry-leading high performance, highly trustworthy products. (2) Analysis of Financial Position As for the financial position in the fiscal year under review, total assets went down by 5,230 million from the previous fiscal year, liabilities decreased by 5,711 million, and net assets increased by 480 million. Major factors of fluctuation in total assets were a reduction of 2,679 million in notes and accounts receivable-trade, a decrease of 682 million in cash and bank deposits, and an increase of 610 million in machinery, equipment and vehicles, net. Major factors of fluctuation in liabilities were a decrease of 1,754 million in accrued income taxes, a reduction of 1,332 million in notes and accounts payable-trade, and an increase of 1,063 million in net defined benefit liability. Major factors of fluctuations in net assets included an increase of 2,567 million in retained earnings, a decrease of 978 million in foreign currency translation adjustments, and a decrease of 775 million in remeasurements of defined benefit plans. (Conditions of cash flows) 7

Cash and cash equivalents (hereinafter referred to as cash ) for the fiscal year under review decreased by 407 million year on year to 12,743 million. The conditions of each cash flow and factors thereof are as follows: (Cash flows from operating activities) Net cash provided by operating activities during the fiscal year under review decreased by 938 million year on year to 4,863 million. This is mainly attributable to income before income taxes and non-controlling interests of 5,385 million, income taxes paid of 3,335 million and depreciation and amortization of 1,978 million. (Cash flows from investing activities) Net cash used in investing activities during the fiscal year under review amounted to 2,057 million and the cash used decreased by 1,529 million from the previous year. This is mainly attributable to purchase of property, plant and equipment of 2,180 million such as production equipment and others. (Cash flows from financing activities) Net cash used in financing activities during the fiscal year under review amounted to 2,708 million and the cash used decreased by 643 million from the previous year. This is mainly attributable to 1,180 million in repayments of long-term debt, dividends paid of 1,113 million, and 152 million in payment of lease obligations payable. (Reference) Changes in cash flow related indicators Fiscal year ended March 31, 2012 Fiscal year ended March 31, 2013 Fiscal year ended March 31, 2014 Fiscal year ended March 31, 2015 Fiscal year ended March 31, 2016 Shareholders equity ratio 55.0% 60.2% 58.6% 57.2% 61.3% Shareholders equity ratio based on fair value 44.9% 61.4% 53.0% 59.0% 38.4% Ratio of cash flow to interest-bearing debt 1.5 years 1.9 years 1.8 years 1.5 years 1.5 years Interest coverage ratio 51.1 43.2 66.9 67.3 62.8 Shareholders equity ratio: Shareholders equity/total assets Shareholders equity ratio based on fair value: Total market value of stock/total assets Ratio of cash flow to interest-bearing debt: Interest-bearing debt/cash flow Interest coverage ratio: Cash flow/interest paid * The indicators were calculated by using consolidated financial figures. * The total market value of stock was calculated based on the total number of shares outstanding, excluding the. * The figures of cash flows from operating activities are used in the table. * Interest-bearing debt includes all debts recorded on the balance sheets for which interest is paid. (3) Dividend Policy and Payments for the Current Fiscal Year and the Next Fiscal Year The Company will further reinforce its business structure that can survive intensifying competition in the industry and increase internal reserves in consideration of business developments in the future, and its basic policy is to pay dividends in proportion to the achievements the Company has made. As for the cash dividend for the fiscal year under review, the year-end cash dividend is set at 9 per share, and the total dividend for the year will be 18 per share, including a 9 interim dividend per share. The cash dividend for the next fiscal year is scheduled to be 18 per share, including a 9 interim dividend per share and a 9 year-end dividend per share. 8

2. Overview of the Group The Group is comprised of the Company and 17 subsidiaries, and its major businesses include manufacturing and sale of cooling fans, power supply equipment, stepping motors, drive units, servomotors, controllers and others. Some of the products of the Group are manufactured by its subsidiaries, SANYO DENKI PHILIPPINES, INC. and SANYO DENKI (Zhongshan) CO., LTD. In Japan, its products are manufactured by its subsidiary, SANYO DENKI Techno Service CO., LTD. Products are sold in Japan by its subsidiary, SANYO KOGYO CO., LTD., in Europe by SANYO DENKI EUROPE S.A. and SANYO DENKI GERMANY GmbH, in North America by SANYO DENKI AMERICA, INC., and in China, Asia and Oceania by Asian-based subsidiaries that are SANYO DENKI SHANGHAI CO., LTD., SANYO DENKI (H.K.) CO., LIMITED, SANYO DENKI SINGAPORE PTE. LTD., SANYO DENKI KOREA CO., LTD., SANYO DENKI TAIWAN CO., LTD., SANYO DENKI Techno Service (Shenzhen) CO., LTD. and SANYO DENKI (THAILAND) CO., LTD. Our subsidiaries are as follows: Consolidated subsidiaries Japan SANYO KOGYO CO., LTD. Sale and installation of electrical machinery and equipment SANYO DENKI Techno Service CO., LTD. Manufacturing and repair of electrical machinery and equipment Overseas SANYO DENKI PHILIPPINES, INC. SANYO DENKI (Zhongshan) CO., LTD. SANYO DENKI EUROPE S.A. SANYO DENKI AMERICA, INC. SANYO DENKI SHANGHAI CO., LTD. SANYO DENKI (H.K.) CO., LIMITED SANYO DENKI TAIWAN CO., LTD. SANYO DENKI SINGAPORE PTE. LTD. SANYO DENKI GERMANY GmbH SANYO DENKI KOREA CO., LTD. SANYO DENKI (Shenzhen) CO., LTD. SANYO DENKI (THAILAND) CO., LTD. SANYO DENKI INDIA PRIVATE LIMITED SANYO DENKI ENGINEERING (Shanghai) CO., LTD. SANYO DENKI Techno Service (Shenzhen) CO., LTD. Non-consolidated subsidiaries There is no relevant information. Manufacturing of electrical machinery and equipment Manufacturing of electrical machinery and equipment Sale of electrical machinery and equipment Sale of electrical machinery and equipment Sale of electrical machinery and equipment Sale of electrical machinery and equipment Sale of electrical machinery and equipment Sale of electrical machinery and equipment Sale of electrical machinery and equipment Sale of electrical machinery and equipment Sale of electrical machinery and equipment Sale of electrical machinery and equipment Sale of electrical machinery and equipment Repair of electrical machinery and equipment Repair of electrical machinery and equipment 9

The business diagram of the Company is as shown below: Customers in China, Asia and Oceania Customers in Japan Customers in North America Customers in Europe Subsidiaries of SANYO DENKI (H.K.) CO., LIMITED SANYO DENKI (Shenzhen) CO., LTD. SANYO DENKI Techno Service (Shenzhen) CO., LTD. Subsidiaries SANYO DENKI EUROPE S.A. SANYO DENKI GERMANY GmbH Subsidiary SANYO DENKI (H.K.) CO., LIMITED Subsidiaries of SANYO DENKI SINGAPORE PTE. LTD. SANYO DENKI (THAILAND) CO., LTD. Subsidiary SANYO DENKI AMERICA, INC. Subsidiary SANYO DENKI SINGAPORE PTE. LTD. Subsidiary of SANYO DENKI SHANGHAI CO., LTD. SANYO DENKI ENGINEERING (Shanghai) CO., LTD. Subsidiary SANYO DENKI SHANGHAI CO., LTD. Subsidiary SANYO KOGYO CO., LTD. Subsidiary SANYO DENKI KOREA CO., LTD. SANYO DENKI TAIWAN CO., LTD. SANYO DENKI INDIA PRIVATE LIMITED SANYO DENKI CO., LTD. Subsidiary of SANYO DENKI (H.K.) CO., LIMITED SANYO DENKI ( Zhongshan ) CO., LTD. Subsidiary SANYO DENKI PHILIPPINES, INC. Subsidiary SANYO DENKI Techno Service CO., LTD. Flow of products and services 10

3. Management Policies (1) Basic Management Policies of the Company The Group aims to increase its existence value in human society and has declared the following corporate philosophy: We SANYO DENKI make the dreams of people come true for the happiness of people in cooperation with people. To realize this corporate philosophy, we have decided the following six management philosophies and the code of conduct that we ourselves must comply with in our business activities. For society and the natural environment, we will help preserve the global environment and contribute to the prosperity of mankind through our corporate activities. For customers and users, we will create new values through technology, products and services. For suppliers and vendors, we will strive for integrated technical development and harmonious mutual prosperity through parts purchase, production contracting and joint development. For investors and financial institutions, we will increase our investment worth and credit through sound management policy and good access to information. For competitors and the industry, we will strive to build industrial and technical development through technical alliances and competition. For all of our employees, we will help individuals to achieve self-fulfillment through their work and the company. (2) Management Targets 1. Management with focus on free cash flow (FCF) 2. Maintenance of return on equity (ROE) at 8% or higher (3) Medium- to Long-Term Business Strategies of the Company The Group started the five-year 8th Mid-term Management Plan in April 2016. With an aim to become a global enterprise and create the world s top brand with the entire Group working as one, we will implement measures under the following important policies and action guidelines. Policies 1) Expand markets in new regions and in new industries. 2) Develop products that will realize new dreams. 3) Aim to be No. 1 in the industry in operation quality. 4) Establish a corporate structure capable of turning environmental changes into opportunities. Action guidelines 1) We take on challenges in fields in which we do not excel and change ourselves so that we come to excel in them. 2) We become No. 1 in fields in which we excel. 3) We provide products and services of consistently high quality to our customers worldwide. 4) We execute business processes of consistently high quality by sharing information across the entire Group in a timely manner. 11

(4) Issues to be Addressed by the Company With the ensuring of orders received and lowering of break-even point as the basics, we aim to promote the Company s brand to the world s top level, and create a system for production, sale and technical support that can quickly and appropriately cope with any environmental changes. (5) Other Important Matters for Management of the Company There is an insurance contract concluded between the Company and KYODO KOGYO CO., LTD. (Representative Director: Shoichi Yamamoto) as a major shareholder of the Company. 4. Basic Policy on Selection of Accounting Standards In consideration of comparability across periods and across companies for the consolidated financial statements, the Group will prepare consolidated financial statements under Japanese accounting standards for the foreseeable future, and concerning the application of International Financial Reporting Standards (IFRS), appropriate action will be taken in consideration of trends within and outside of Japan. 12

5. Consolidated Financial Statements (1) Consolidated Balance Sheets As of March 31, 2015 As of March 31, 2016 Assets Current assets Cash and bank deposits 13,896 13,213 Notes and accounts receivable-trade 23,073 20,393 Electronically recorded monetary claims - operating 3,067 3,412 Securities 54 Merchandise and finished goods 6,244 5,757 Raw materials 7,449 7,007 Work in process 3,498 3,245 Costs on uncompleted construction contracts 119 249 Supplies 25 35 Other receivables 599 360 Deferred tax assets 1,123 762 Others 1,365 925 Allowance for doubtful accounts (27) (24) Total current assets 60,488 55,339 Fixed assets Tangible fixed assets Buildings and structures, net 9,902 9,483 Machinery, equipment and vehicles, net 2,223 2,833 Land 6,458 6,450 Construction in progress 665 516 Others, net 876 1,104 Total tangible fixed assets 20,127 20,388 Intangible fixed assets 506 489 Investments and other assets Investments in securities 6,009 5,382 Deferred tax assets 371 651 Others 2,690 2,712 Allowance for doubtful accounts (17) (17) Total investments and other assets 9,054 8,728 Total fixed assets 29,687 29,606 Total assets 90,176 84,945 13

As of March 31, 2015 As of March 31, 2016 Liabilities Current liabilities Notes and accounts payable trade 15,956 14,623 Short-term debt 7,429 6,816 Accrued income taxes 1,974 220 Deferred tax liabilities 2 3 Reserve for bonuses to directors and corporate auditors 92 89 Other current liabilities 6,053 4,085 Total current liabilities 31,509 25,839 Long-term liabilities Long-term debt 1,263 514 Lease obligations 463 304 Deferred tax liabilities 152 0 Deferred tax liabilities revaluation 885 840 Net defined benefit liability 4,283 5,347 Total non-current liabilities 7,048 7,007 Total liabilities 38,558 32,846 Net assets Shareholders equity Common stock 9,926 9,926 Capital surplus 11,460 11,460 Retained earnings 27,431 29,998 Treasury stock (912) (919) Total shareholders equity 47,906 50,466 Accumulated other comprehensive income Unrealized holding gain on securities 1,589 1,220 Revaluation reserve for land, net of tax 891 936 Foreign currency translation adjustments 2,343 1,365 Remeasurements of defined benefit plans (1,119) (1,895) Total accumulated other comprehensive income 3,705 1,626 Non-controlling interests 6 6 Total net assets 51,618 52,099 Total liabilities and net assets 90,176 84,945 14

(2) Consolidated Statements of Income and Comprehensive Income Consolidated Statements of Income For the fiscal year ended March 31, 2015 For the fiscal year ended March 31, 2016 Net sales 91,745 80,282 Cost of sales 71,163 61,808 Gross profit 20,582 18,474 Selling, general and administrative expenses 13,103 13,131 Operating income 7,478 5,342 Other income Interest income 72 39 Dividend income 100 114 Gain on sales of securities 0 0 Foreign exchange gain 526 Subsidy income 132 Rent income 83 82 Others 121 134 Total other income 1,037 370 Other expenses Interest expense 74 65 Loss on sales of notes payable 8 9 Foreign exchange loss 239 Others 22 10 Total other expenses 105 325 Ordinary income 8,409 5,387 Extraordinary income Gain on sales of fixed assets 1 1 Total extraordinary income 1 1 Extraordinary loss Loss on sales of fixed assets 0 Loss on retirement of fixed assets 8 3 Loss on valuation of membership 3 Total extraordinary loss 12 3 Income before income taxes and non-controlling interests 8,398 5,385 Income taxes-current 2,970 1,280 Income taxes-deferred (292) 419 Total income taxes 2,677 1,699 Profit 5,721 3,685 Profit attributable to non-controlling interests 1 0 Profit attributable to owners of parent 5,720 3,685 15

Consolidated Statements of Comprehensive Income For the fiscal year ended March 31, 2015 For the fiscal year ended March 31, 2016 Profit 5,721 3,685 Other comprehensive income Unrealized holding gain on securities 899 (369) Revaluation reserve for land, net of tax 91 44 Foreign currency translation adjustments 1,217 (978) Remeasurements of defined benefit plans (231) (775) Total other comprehensive income 1,977 (2,079) Comprehensive income 7,698 1,606 Comprehensive income attributable to: Owners of parent 7,697 1,606 Non-controlling interests 0 0 16

(3) Consolidated Statements of Changes in Net Assets For the fiscal year ended March 31, 2015 Common stock Capital surplus Shareholders equity Retained earnings Treasury stock Total shareholders equity beginning of the 9,926 11,460 23,605 (906) 44,086 year Cumulative effects of changes in (900) (900) accounting policies Restated balance 9,926 11,460 22,704 (906) 43,185 Changes of items during the year Cash dividends (993) (993) Profit attributable to owners of 5,720 5,720 parent Acquisition of (6) (6) Disposal of 0 0 0 Net changes of items other than shareholders equity Total changes of items during the 0 4,726 (5) 4,721 year end of the year 9,926 11,460 27,431 (912) 47,906 Unrealized holding gain on securities Accumulated other comprehensive income Revaluation reserve for land, net of tax Foreign currency translation adjustments Remeasurements of defined benefit plans Total accumulated other comprehensive income Non-controlling interests Total net assets beginning of the 690 799 1,125 (887) 1,727 5 45,819 year Cumulative effects of changes in (900) accounting policies Restated balance 690 799 1,125 (887) 1,727 5 44,918 Changes of items during the year Cash dividends (993) Profit attributable to owners of 5,720 parent Acquisition of (6) Disposal of 0 Net changes of items other than shareholders 899 91 1,218 (231) 1,977 0 1,978 equity Total changes of items during the 899 91 1,218 (231) 1,977 0 6,699 year end of the year 1,589 891 2,343 (1,119) 3,705 6 51,618 17

For the fiscal year ended March 31, 2016 Common stock Capital surplus Shareholders equity Retained earnings Treasury stock Total shareholders equity beginning of the 9,926 11,460 27,431 (912) 47,906 year Cumulative effects of changes in accounting policies Restated balance 9,926 11,460 27,431 (912) 47,906 Changes of items during the year Cash dividends (1,117) (1,117) Profit attributable to owners of 3,685 3,685 parent Acquisition of (7) (7) Disposal of Net changes of items other than shareholders equity Total changes of items during the 2,567 (7) 2,559 year end of the year 9,926 11,460 29,998 (919) 50,466 Unrealized holding gain on securities Accumulated other comprehensive income Revaluation reserve for land, net of tax Foreign currency translation adjustments Remeasurements of defined benefit plans Total accumulated other comprehensive income Non-controlling interests Total net assets beginning of the 1,589 891 2,343 (1,119) 3,705 6 51,618 year Cumulative effects of changes in accounting policies Restated balance 1,589 891 2,343 (1,119) 3,705 6 51,618 Changes of items during the year Cash dividends (1,117) Profit attributable to owners of 3,685 parent Acquisition of (7) Disposal of Net changes of items other than shareholders (369) 44 (978) (775) (2,078) 0 (2,078) equity Total changes of items during the (369) 44 (978) (775) (2,078) 0 480 year end of the year 1,220 936 1,365 (1,895) 1,626 6 52,099 18

(4) Consolidated Statements of Cash Flows For the fiscal year ended March 31, 2015 For the fiscal year ended March 31, 2016 Cash flows from operating activities Income before income taxes and non-controlling interests 8,398 5,385 Depreciation and amortization 2,202 1,978 Increase (decrease) in net defined benefit liability 32 (12) Increase (decrease) in allowance for doubtful accounts (21) (1) Increase (decrease) in reserve for bonuses to directors and corporate auditors 20 (3) Interest and dividend income (172) (154) Net loss (gain) on sales of securities (0) 3 Loss on valuation of membership 3 Interest expenses 74 65 Loss on sales of notes payable 8 9 Foreign exchange loss (gain) 146 (47) Net loss (gain) on sales of fixed assets (0) (1) Net loss (gain) on disposal of fixed assets 8 3 Decrease (increase) in notes and accounts receivable-trade (3,656) 1,942 Decrease (increase) in inventories (2,818) 585 Decrease (increase) in other receivables (103) 228 Increase (decrease) in notes and accounts payable trade 2,636 (860) Others 1,012 (1,000) Subtotal 7,771 8,121 Interest and dividend received 173 154 Interest paid (86) (77) Income taxes paid (2,056) (3,335) Net cash provided by (used in) operating activities 5,801 4,863 Cash flows from investing activities Increase in time deposits (330) (0) Decrease in time deposits 33 312 Purchase of property, plant and equipment (2,745) (2,180) Proceeds from sales of property, plant and equipment 51 3 Purchase of intangible fixed assets (168) (147) Purchase of investment securities (84) (46) Proceeds from sales of investment securities 34 88 Payment of loans (10) Proceeds from loans 21 16 Others (398) (93) Net cash provided by (used in) investing activities (3,587) (2,057) 19

For the fiscal year ended March 31, 2015 For the fiscal year ended March 31, 2016 Cash flows from financing activities Increase (decrease) in short-term debt (944) (136) Proceeds from long-term debt 21 Repayments of long-term debt (1,193) (1,180) Acquisition of (6) (7) Dividends paid (990) (1,113) Dividends paid to non-controlling interests (7) (0) Payment of lease obligations payable (159) (152) Others (50) (139) Net cash provided by (used in) financing activities (3,352) (2,708) Effect of exchange rate change on cash and cash equivalents 570 (504) Net increase (decrease) in cash and cash equivalents (568) (407) Cash and cash equivalents at beginning of year 13,719 13,151 Cash and cash equivalents at end of year 13,151 12,743 20

(5) Notes to the Consolidated Financial Statements (Notes on Going Concern Assumption) There is no relevant information. (Important Matters that Form the Basis for Preparing Consolidated Financial Statements) 1. Scope of consolidation Consolidated subsidiaries: 17 Non-consolidated subsidiaries: 2. Application of the equity method There is no relevant company. 3. Closing dates of consolidated subsidiaries Companies with same closing dates as the company that submits consolidated financial statements: 3 (March 31) Companies with differing closing dates as the company that submits consolidated financial statements: 14 (December 31) For preparation of consolidated financial statements, financial statements based on provisional settlements of accounts as of the consolidated closing date are used. (Omission of Disclosure) Disclosure is omitted with respect to notes on consolidated balance sheets, consolidated statements of income, consolidated statements of comprehensive income, consolidated statements of changes in net assets, consolidated statements of cash flows, lease transactions, transactions with related parties, tax effect accounting, financial instruments, securities and retirement benefits, since the Company considers there to be no great necessity for disclosing such information in the financial results. (Changes in Accounting Policies) The Accounting Standard for Business Combinations (ASBJ Statement No. 21, September 13, 2013), the Accounting Standard for Consolidated Financial Statements (ASBJ Statement No. 22, September 13, 2013) and the Revised Accounting Standard for Business Divestitures (ASBJ Statement No. 7, September 13, 2013) and other standards have been applied from the fiscal year ended March 31, 2016 to change the presentation of net income and other items, and change minority interests to non-controlling interests. To reflect the changes in presentation, consolidated financial statements for the previous fiscal year have been reclassified. (Changes in Accounting Policies that Are Difficult to Distinguish from Changes in Accounting Estimates) For depreciation of tangible fixed assets, the Company and its domestic consolidated subsidiaries previously used the declining-balance method for certain tangible fixed assets. But from the fiscal year ended March 31, 2016, the straight-line method has been applied. Responding to the increasing demand overseas, we started operations at the third plant of SANYO DENKI PHILIPPINES, INC. during the previous fiscal year, and took other measures to enhance the overseas production system. Upon examining the usage conditions of tangible fixed assets, state of operation of tangible fixed assets owned by the Company and its domestic consolidated subsidiaries is hereafter expected to be stable and level out. The Company decided to change the depreciation method from the previous declining-balance method to the straight-line method based on the belief that, evenly allocating the depreciation expense would more appropriately reflect the actual usage status of tangible fixed assets of the Company and its domestic consolidated subsidiaries. As a result of this change, operating income, ordinary income and income before income taxes and non-controlling interests for the fiscal year ended March 31, 2016 increased by 254 million each, 21

compared with the amounts under the formerly applied method. (Segment Information, etc.) 1 Description of reporting segment (1) Method of decision on reporting segments The Group s reporting segments are determined on the basis that separate financial information of such segments are available and examined periodically by the Board of Directors to make decisions regarding the allocation of management resources and assess the business performances of such segments. The Group mainly produces and sells cooling fans, power supply equipment and servomotors. The Company and its domestic subsidiaries are in charge of such operations in Japan, and overseas subsidiaries are in charge of such operations in their respective regions. Each of the consolidated subsidiaries is an independent business unit, and formulates comprehensive business strategies for their products and promotes its business activities. (2) Types of regions that belong to reporting segments The Group is composed of five reporting segments, Japan, North America, Europe, East Asia and Southeast Asia, which are determined by grouping the respective consolidated subsidiaries by region. 2 Calculation method for the amounts of net sales, profit (loss), assets, liabilities and other items for each reporting segment The accounting method used for reporting business segments is generally the same as stated in Important Matters That Form the Basis for Preparing Consolidated Financial Statements. Profit amounts of reporting segments are based on operating income. Intersegment sales and transfers are based on actual market prices. (Change in depreciation method of tangible fixed assets) As written in Changes in Accounting Policies that Are Difficult to Distinguish from Changes in Accounting Estimates, the Company and its domestic consolidated subsidiaries previously used the declining-balance method for certain tangible fixed assets. But from the fiscal year ended March 31, 2016, the straight-line method has been applied. As a result of this change, segment profit in Japan for the fiscal year ended March 31, 2016 increased by 254 million, compared with the amount under the formerly applied method. 22

3 Information on net sales, profit (loss), assets, liabilities and other items by reporting segment For the fiscal year ended March 31, 2015 Japan North America Reporting segment Europe East Asia Southeast Asia Sales Sales to customers 64,782 9,003 5,580 10,818 1,560 91,745 Intersegment sales or Total 23,291 225 27 4,503 18,617 46,666 transfers Total 88,074 9,229 5,608 15,322 20,177 138,412 Segment profit 5,784 238 526 620 514 7,683 Segment assets 77,496 4,066 3,147 8,231 9,851 102,794 Segment liabilities 35,083 2,201 1,432 3,503 3,785 46,006 Other items Depreciation and amortization Increase in tangible fixed assets and intangible fixed assets 1,488 25 8 53 641 2,217 1,340 170 11 158 1,738 3,419 In preparation of consolidated financial statements so far, necessary adjustments for consolidated accounting have been made with using the financial statements of 14 overseas consolidated subsidiaries as of three months before. In order to prepare the most up-to-date consolidated financial statements, we changed our method to use the financial statements of the overseas consolidated subsidiaries for the same period as ours, beginning from FY2015. Therefore, the consolidated statements of income for the previous fiscal year include the three-month results from January 1 to March 31, 2014 of the overseas consolidated subsidiaries. The three-month results for overseas consolidated subsidiaries between January 1, 2014 and March 31, 2014 included in the consolidated statements of income for the previous fiscal year are as follows: (From January 1, 2014 to March 31, 2014) Japan North America Reporting segment Europe East Asia Southeast Asia Sales Sales to customers 1,841 1,074 1,446 278 4,641 Intersegment sales or Total 19 8 600 3,391 4,019 transfers Total 1,861 1,083 2,046 3,669 8,661 Segment profit 86 102 77 151 417 23

For the fiscal year ended March 31, 2016 Japan North America Reporting segment Europe East Asia Southeast Asia Sales Sales to customers 58,322 8,142 4,576 8,032 1,207 80,282 Intersegment sales or Total 21,801 65 32 3,737 15,255 40,892 transfers Total 80,124 8,208 4,609 11,769 16,463 121,175 Segment profit 3,816 227 299 52 627 5,023 Segment assets 73,298 3,468 2,844 6,736 9,303 95,652 Segment liabilities 29,468 1,608 1,038 2,480 3,138 37,734 Other items Depreciation and amortization Increase in tangible fixed assets and intangible fixed assets 1,242 58 6 68 608 1,983 1,802 28 11 16 643 2,502 24

4 Differences between amounts recognized in reporting segments and the corresponding amounts reported in the consolidated financial statements, and the primary items contributing to the difference Sales For the fiscal year For the fiscal year ended March 31, 2015 ended March 31, 2016 Total of reporting segments 138,412 121,175 Elimination of intersegment transactions (46,666) (40,892) Consolidated net sales 91,745 80,282 Profit For the fiscal year For the fiscal year ended March 31, 2015 ended March 31, 2016 Total of reporting segments 7,683 5,023 Elimination of intersegment transactions (204) 318 Consolidated operating income 7,478 5,342 Assets For the fiscal year For the fiscal year ended March 31, 2015 ended March 31, 2016 Total of reporting segments 102,794 95,652 Elimination of intersegment transactions (12,617) (10,706) Consolidated total assets 90,176 84,945 Liabilities For the fiscal year For the fiscal year ended March 31, 2015 ended March 31, 2016 Total of reporting segments 46,006 37,734 Elimination of intersegment transactions (7,448) (4,888) Consolidated total liabilities 38,558 32,846 Other items Total of reporting segments As of March 31, 2015 As of March 31, 2016 As of March 31, 2015 Adjustments As of March 31, 2016 As of March 31, 2015 Consolidated As of March 31, 2016 Depreciation and amortization 2,217 1,983 (14) (5) 2,202 1,978 Increase in tangible fixed assets and intangible fixed assets 3,419 2,502 (33) (21) 3,386 2,480 (Note) Adjustments for increase in tangible fixed assets and intangible fixed assets are due to elimination of intersegment transactions. 25

(Per Share Information) For the fiscal year ended March 31, 2015 For the fiscal year ended March 31, 2016 Net assets per share 830.94 838.80 Basic earnings per share 92.09 59.34 Diluted earnings per share (Note) 1. Diluted earnings per share is not disclosed since there are no potentially dilutive shares. 2. The basis for the calculation of basic earnings per share is as follows: Items For the fiscal year For the fiscal year ended March 31, 2015 ended March 31, 2016 Basic earnings per share Profit attributable to owners of parent (million yen) 5,720 3,685 Amount not attributable to common stockholders (million yen) Profit attributable to owners of parent relating to common stock (million yen) 5,720 3,685 Average number of common stock outstanding (shares) 62,115,156 62,107,090 3. The basis for the calculation of net assets per share is as follows: Items For the fiscal year For the fiscal year ended March 31, 2015 ended March 31, 2016 Total net assets (million yen) 51,618 52,099 Deductible amount from total net assets (million yen) 6 6 (Subscription rights to shares) (Non-controlling interests) 6 6 Net assets relating to common stock at end of year (million yen) 51,612 52,092 Number of common stocks for calculation of net assets per share at end of year 62,112,803 62,103,511 (Material Subsequent Events) There is no relevant information. 26

6. Non-consolidated Financial Statements (1) Non-consolidated Balance Sheets As of March 31, 2015 As of March 31, 2016 Assets Current assets Cash and bank deposits 3,554 2,704 Notes receivable-trade 705 457 Electronically recorded monetary claims - operating 3,067 3,037 Accounts receivable-trade 19,932 15,588 Finished goods 3,005 3,559 Raw materials 4,666 4,505 Work in process 3,034 2,850 Supplies 25 35 Prepaid expense 73 79 Deferred tax assets 632 386 Others 1,079 948 Allowance for doubtful accounts (2) (1) Total current assets 39,774 34,150 Fixed assets Tangible fixed assets Buildings 7,156 7,065 Structures 240 227 Machinery and equipment 1,253 1,641 Vehicles 22 24 Tools, furniture and fixtures 418 599 Land 6,188 6,188 Construction in progress 323 412 Total tangible fixed assets 15,603 16,159 Intangible fixed assets Leasehold right 44 44 Software 293 326 Others 22 22 Total intangible fixed assets 360 393 27

As of March 31, 2015 As of March 31, 2016 Investments and other assets Investments in securities 4,897 4,647 Stocks of subsidiaries and affiliates 3,003 2,718 Investments in capital of subsidiaries and affiliates 208 208 Long-term loans receivable 72 67 Long-term prepaid expenses 25 109 Deferred tax assets 35 122 Others 1,823 1,853 Allowance for doubtful accounts (0) (0) Total investments and other assets 10,066 9,727 Total fixed assets 26,031 26,280 Total assets 65,805 60,430 Liabilities Current liabilities Notes payable trade 1,439 1,069 Accounts payable trade 9,952 7,325 Short-term debt 5,941 5,780 Long-term debt due within one year 855 450 Lease obligations 130 141 Accounts payable other 928 647 Accrued expenses 2,600 2,029 Accrued income taxes 1,483 27 Advances received 63 23 Deposits received 46 151 Notes payable facilities 163 115 Reserve for bonuses to directors and corporate auditors 80 70 Total current liabilities 23,685 17,831 Long-term liabilities Long-term debt 512 62 Lease obligations 406 302 Deferred tax liabilities revaluation 885 840 Reserve for retirement benefits 2,238 2,276 Total long-term liabilities 4,043 3,482 Total liabilities 27,728 21,313 28