Toyota Motor (TM) 6-K FY2020 Second Quarter

FINANCIAL SUMMARY

(All financial information has been prepared in accordance with U.S. generally accepted accounting principles)

FY2020 Second Quarter

(April 1, 2019 through September 30, 2019)

English translation from the original Japanese-language document

TOYOTA MOTOR CORPORATION

FY2020 Second Quarter Consolidated Financial Results

(All financial information has been prepared in accordance with U.S. generally accepted accounting principles)

English translation from the original Japanese-language document

November 7, 2019

Company name	:Toyota Motor Corporation
Stock exchanges on which the shares are listed	: Tokyo and Nagoya Stock Exchanges in Japan
Code number	: 7203
URL Representative	:https://global.toyota/jp/ : Akio Toyoda, President
Contact person	: Kaname Shimizu, General Manager, Accounting Division   Tel.(0565)28-2121
Filing date of quarterly securities report	: November 13, 2019
Payment date of cash dividends	: November 27, 2019
Supplemental materials prepared for quarterly financial results	: yes
Earnings announcement for quarterly financial results	: yes

(Amounts are rounded to the nearest million yen)

1. Consolidated Results for FY2020 First Half (April 1, 2019 through September 30, 2019)

(1) Consolidated financial results (For the six months ended September 30)

	(% of change from previous first half)
	Net revenues				Operating income				Income before income taxes and equity in earnings of affiliated companies				Net income attributable to Toyota Motor Corporation
	Million yen		%		Million yen		%		Million yen		%		Million yen		%
FY2020 first half		15,285,595		4.2		1,404,336		11.3		1,583,485		2.2		1,274,976		2.6
FY2019 first half		14,674,006		3.4		1,261,845		15.1		1,548,809		23.7		1,242,392		16.0

(Note) Comprehensive income: FY2020 first half 1,129,900 million yen (-25.5 %), FY2019 first half 1,516,668 million yen (10.9 %)

	Net income attributable to Toyota Motor Corporation per common share  – Basic		Net income attributable to Toyota Motor Corporation per common share – Diluted
	Yen		Yen
FY2020 first half		449.35		444.98
FY2019 first half		427.02		422.68

(2) Consolidated financial position

	Total assets		Mezzanine equity and Shareholders’ equity		Toyota Motor Corporation shareholders’ equity		Ratio of Toyota Motor Corporation shareholders’ equity
	Million yen		Million yen		Million yen		%
FY2020 second quarter		52,240,078		21,002,317		19,795,642		37.9
FY2019		51,936,949		20,565,210		19,348,152		37.3

2. Cash Dividends

	Annual cash dividends per common share
	End of first quarter		End of second quarter		End of third quarter		Year-end		Total
	Yen		Yen		Yen		Yen		Yen
FY2019		—		100.00		—		120.00		220.00
FY2020		—		100.00
FY2020 (forecast)						—		—		—

(Note)	Revisions to the forecast of cash dividends since the latest announcement: none
	Please refer to “(Reference) Cash Dividends on Class Shares” for information regarding cash dividends on class shares, which are unlisted and have different rights from common stock.

3. Forecast of Consolidated Results for FY2020 (April 1, 2019 through March 31, 2020)

	(% of change from FY2019)
	Net revenues				Operating income				Income before income taxes and equity in earnings of affiliated companies				Net income attributable to Toyota Motor Corporation				Net income attributable to Toyota Motor Corporation per common share – Basic
	Million yen		%		Million yen		%		Million yen		%		Million yen		%		Yen
Full-year		29,500,000		-2.4		2,400,000		-2.7		2,630,000		15.1		2,150,000		14.2		760.80

(Note) Revisions to the forecast of consolidated results since the latest announcement: yes

Notes

(1) Changes in significant subsidiaries during the current quarter

(Changes in specified subsidiaries that caused a change in the scope of consolidation): none

(2) Simplified accounting procedures and specific accounting procedures: yes

Note: For more details, please see page 9 “Other Information”.

(3) Changes in accounting policies

(i) Changes by a newly issued accounting pronouncement: yes

(ii) Changes other than (3)-(i) above: yes

Note: For more details, please see page 9 “Other Information”.

(4) Number of shares issued and outstanding (common stock)

(i) Number of shares issued and outstanding at the end of each period (including treasury stock):

FY2020 second quarter 3,262,997,492 shares, FY2019 3,262,997,492 shares

(ii) Number of treasury stock at the end of each period:

FY2020 second quarter 473,914,931 shares, FY2019 430,558,325 shares

(iii) Average number of shares issued and outstanding in each period:

FY2020 first half 2,818,172,637 shares, FY2019 first half 2,892,141,263 shares

This report is not reviewed.

Cautionary Statement with Respect to Forward-Looking Statements, and Other Information

This report contains forward-looking statements that reflect Toyota’s plans and expectations. These forward-looking statements are not guarantees of future performance and involve known and unknown risks, uncertainties and other factors that may cause Toyota’s actual results, performance, achievements or financial position to be materially different from any future results, performance, achievements or financial position expressed or implied by these forward-looking statements. These factors include, but are not limited to: (i) changes in economic conditions, market demand, and the competitive environment affecting the automotive markets in Japan, North America, Europe, Asia and other markets in which Toyota operates; (ii) fluctuations in currency exchange rates, particularly with respect to the value of the Japanese yen, the U.S. dollar, the euro, the Australian dollar, the Russian ruble, the Canadian dollar and the British pound, fluctuations in stock prices, and interest rates fluctuations; (iii) changes in funding environment in financial markets and increased competition in the financial services industry; (iv) Toyota’s ability to market and distribute effectively; (v) Toyota’s ability to realize production efficiencies and to implement capital expenditures at the levels and times planned by management; (vi) changes in the laws, regulations and government policies in the markets in which Toyota operates that affect Toyota’s automotive operations, particularly laws, regulations and government policies relating to vehicle safety including remedial measures such as recalls, trade, environmental protection, vehicle emissions and vehicle fuel economy, as well as changes in laws, regulations and government policies that affect Toyota’s other operations, including the outcome of current and future litigation and other legal proceedings, government proceedings and investigations; (vii) political and economic instability in the markets in which Toyota operates; (viii) Toyota’s ability to timely develop and achieve market acceptance of new products that meet customer demand; (ix) any damage to Toyota’s brand image; (x) Toyota’s reliance on various suppliers for the provision of supplies; (xi) increases in prices of raw materials; (xii) Toyota’s reliance on various digital and information technologies; (xiii) fuel shortages or interruptions in electricity, transportation systems, labor strikes, work stoppages or other interruptions to, or difficulties in, the employment of labor in the major markets where Toyota purchases materials, components and supplies for the production of its products or where its products are produced, distributed or sold; and (xiv) the impact of natural calamities including the negative effect on Toyota’s vehicle production and sales.

A discussion of these and other factors which may affect Toyota’s actual results, performance, achievements or financial position is contained in Toyota’s annual report on Form20-F, which is on file with the United States Securities and Exchange Commission.

This report contains summarized and condensed financial information prepared in accordance with U.S. generally accepted accounting principles.

(Reference) Cash Dividends on Class Shares

Cash dividends on class shares, which have different rights from common stock, are as follows:

	Annual cash dividends per First Series Model AA Class Share
	End of first quarter		End of second quarter		End of third quarter		Year-end		Total
	Yen		Yen		Yen		Yen		Yen
FY2019		—		105.50		—		105.50		211.00
FY2020		—		132.00
FY2020 (forecast)						—		—		—

(Note) The First Series Model AA Class Shares were issued in July 2015.

TOYOTA MOTOR CORPORATION    FY2020 Second Quarter Financial Summary

TABLE OF CONTENTS

1.  Consolidated Financial Statements	2
(1) Consolidated Balance Sheets	2
(2) Consolidated Statements of Income and Consolidated Statements of Comprehensive Income	4
(3) Consolidated Statements of Cash Flows	8
(4) Going Concern Assumption	9
(5) Significant Changes in Shareholders’ Equity	9
2.  Other Information	9
(1) Changes in significant subsidiaries during the current period	9
(2) Simplified accounting procedures and accounting procedures specific to quarterly consolidated financial statements	9
(3) Changes in accounting principles, procedures, and disclosures for consolidated financial statements	9
Supplemental Material for Financial Results for FY2020 Second Quarter

1

TOYOTA MOTOR CORPORATION    FY2020 Second Quarter Financial Summary

1. Consolidated Financial Statements

(1) Consolidated Balance Sheets

	(Yen in millions)
	FY2019 (March 31, 2019)			FY2020 second quarter (September 30, 2019)			Increase (Decrease)
Assets
Current assets:
Cash and cash equivalents		3,574,704			3,979,764			405,060
Time deposits		1,126,352			1,334,616			208,264
Marketable securities		1,127,160			876,440			(250,720	)
Trade accounts and notes receivable, less allowance for doubtful accounts		2,372,734			2,228,524			(144,210	)
Finance receivables, net		6,647,771			6,558,020			(89,751	)
Other receivables		568,156			549,874			(18,282	)
Inventories		2,656,396			2,576,968			(79,428	)
Prepaid expenses and other current assets		805,964			872,710			66,746
Total current assets		18,879,237			18,976,916			97,679
Noncurrent finance receivables, net		10,281,118			10,396,209			115,091
Investments and other assets:
Marketable securities and other securities investments		7,479,926			7,220,663			(259,263	)
Affiliated companies		3,313,723			3,392,862			79,139
Employees receivables		21,683		��	21,790			107
Other		1,275,768			1,636,237			360,469
Total investments and other assets		12,091,100			12,271,552			180,452
Property, plant and equipment:
Land		1,386,308			1,362,252			(24,056	)
Buildings		4,802,175			4,755,496			(46,679	)
Machinery and equipment		11,857,425			11,791,699			(65,726	)
Vehicles and equipment on operating leases		6,139,163			5,947,228			(191,935	)
Construction in progress		651,713			646,680			(5,033	)
Total property, plant and equipment, at cost		24,836,784			24,503,355			(333,429	)
Less – Accumulated depreciation		(14,151,290	)		(13,907,954	)		243,336
Total property, plant and equipment, net		10,685,494			10,595,401			(90,093	)
Total assets		51,936,949			52,240,078			303,129

2

TOYOTA MOTOR CORPORATION    FY2020 Second Quarter Financial Summary

	(Yen in millions)
	FY2019 (March 31, 2019)			FY2019 second quarter (September 30, 2019)			Increase (Decrease)
Liabilities
Current liabilities:
Short-term borrowings		5,344,973			5,198,456			(146,517	)
Current portion of long-term debt		4,254,260			4,453,335			199,075
Accounts payable		2,645,984			2,546,545			(99,439	)
Other payables		1,102,802			937,139			(165,663	)
Accrued expenses		3,222,446			3,064,629			(157,817	)
Income taxes payable		320,998			277,766			(43,232	)
Other current liabilities		1,335,475			1,454,390			118,915
Total current liabilities		18,226,938			17,932,260			(294,678	)
Long-term liabilities:
Long-term debt		10,550,945			10,340,214			(210,731	)
Accrued pension and severance costs		963,406			969,810			6,404
Deferred income taxes		1,014,851			1,092,125			77,274
Other long-term liabilities		615,599			903,352			287,753
Total long-term liabilities		13,144,801	��		13,305,501			160,700
Total liabilities		31,371,739			31,237,761			(133,978	)
Mezzanine equity
Model AA Class Shares, no par value, authorized: 150,000,000 shares at March 31, 2019 and September 30, 2019 issued: 47,100,000 shares at March 31, 2019 and September 30, 2019		498,073			501,744			3,671
Shareholders’ equity
Toyota Motor Corporation shareholders’ equity:
Common stock, no par value, authorized: 10,000,000,000 shares at March 31, 2019 and September 30, 2019 issued: 3,262,997,492 shares at March 31, 2019 and September 30, 2019		397,050			397,050			—
Additionalpaid-in capital		487,162			491,142			3,980
Retained earnings		21,987,515			22,913,956			926,441
Accumulated other comprehensive income (loss)		(916,650	)		(1,099,428	)		(182,778	)
Treasury stock, at cost, 430,558,325 shares at March 31, 2019 and 473,914,931 shares at September 30, 2019		(2,606,925	)		(2,907,078	)		(300,153	)
Total Toyota Motor Corporation shareholders’ equity		19,348,152			19,795,642			447,490
Noncontrolling interests		718,985			704,931			(14,054	)
Total shareholders’ equity		20,067,137			20,500,573			433,436
Commitments and contingencies
Total liabilities, mezzanine equity and shareholders’ equity		51,936,949			52,240,078			303,129

Note: The total number of authorized shares for common stock and Model AA Class Shares is 10,000,000,000 shares.

3

TOYOTA MOTOR CORPORATION    FY2020 Second Quarter Financial Summary

(2) Consolidated Statements of Income and Consolidated Statements of Comprehensive Income

First half for the six months ended September 30
Consolidated Statements of Income
	(Yen in millions)
	FY2019 first half (Six months ended September 30, 2018)			FY2020 first half (Six months ended September 30, 2019)			Increase (Decrease)
Net revenues:
Sales of products		13,638,830			14,206,661			567,831
Financing operations		1,035,176			1,078,934			43,758
Total net revenues		14,674,006			15,285,595			611,589
Costs and expenses:
Cost of products sold		11,290,626			11,840,365			549,739
Cost of financing operations		693,531			654,126			(39,405	)
Selling, general and administrative		1,428,004			1,386,768			(41,236	)
Total costs and expenses		13,412,161			13,881,259			469,098
Operating income		1,261,845			1,404,336			142,491
Other income (expense):
Interest and dividend income		124,778			126,221			1,443
Interest expense		(11,603	)		(14,846	)		(3,243	)
Foreign exchange gain (loss), net		64,784			(61,167	)		(125,951	)
Unrealized gains (losses) on equity securities		147,849			145,427			(2,422	)
Other income (loss), net		(38,844	)		(16,486	)		22,358
Total other income (expense)		286,964			179,149			(107,815	)
Income before income taxes and equity in earnings of affiliated companies		1,548,809			1,583,485			34,676
Provision for income taxes		473,591			474,648			1,057
Equity in earnings of affiliated companies		222,587			205,952			(16,635	)
Net income		1,297,805			1,314,789			16,984
Less – Net income attributable to noncontrolling interests		(55,413	)		(39,813	)		15,600
Net income attributable to Toyota Motor Corporation		1,242,392			1,274,976			32,584
Note:  Net income attributable to common shareholders for the first half ended September 30, 2019 and 2018 is 1,266,334 million yen and 1,234,998 million yen, respectively, which is derived by deducting dividend and accretion to Model AA Class Shares of 8,642 million yen and 7,394 million yen, respectively, from Net income attributable to Toyota Motor Corporation.
	(Yen)
Net income attributable to Toyota Motor Corporation per common share
Basic		427.02			449.35			22.33
Diluted		422.68			444.98			22.30

4

TOYOTA MOTOR CORPORATION    FY2020 Second Quarter Financial Summary

Consolidated Statements of Comprehensive Income
	(Yen in millions)
	FY2019 first half (Six months ended September 30, 2018)			FY2020 first half (Six months ended September 30, 2019)			Increase (Decrease)
Net income		1,297,805			1,314,789			16,984
Other comprehensive income (loss), net of tax
Foreign currency translation adjustments		141,848			(251,656	)		(393,504	)
Unrealized gains (losses) on securities		65,855			65,567			(288	)
Pension liability adjustments		11,160			1,200			(9,960	)
Total other comprehensive income (loss)		218,863			(184,889	)		(403,752	)
Comprehensive income		1,516,668			1,129,900			(386,768	)
Less – Comprehensive income attributable to noncontrolling interests		(57,836	)		(37,702	)		20,134
Comprehensive income attributable to Toyota Motor Corporation		1,458,832			1,092,198			(366,634	)

5

TOYOTA MOTOR CORPORATION    FY2020 Second Quarter Financial Summary

Second quarter for the three months ended September 30
Consolidated Statements of Income
	(Yen in millions)
	FY2019 second quarter (Three months ended September 30, 2018)			FY2020 second quarter (Three months ended September 30, 2019)			Increase (Decrease)
Net revenues:
Sales of products		6,784,867			7,102,868			318,001
Financing operations		526,406			536,636			10,230
Total net revenues		7,311,273			7,639,504			328,231
Costs and expenses:
Cost of products sold		5,650,630			5,970,713			320,083
Cost of financing operations		345,376			313,688			(31,688	)
Selling, general and administrative		736,109			692,718			(43,391	)
Total costs and expenses		6,732,115			6,977,119			245,004
Operating income		579,158			662,385			83,227
Other income (expense):
Interest and dividend income		36,890			51,830			14,940
Interest expense		(8,164	)		(10,495	)		(2,331	)
Foreign exchange gain (loss), net		25,568			(3,159	)		(28,727	)
Unrealized gains (losses) on equity securities		112,816			54,656			(58,160	)
Other income (loss), net		(11,323	)		(13,482	)		(2,159	)
Total other income (expense)		155,787			79,350			(76,437	)
Income before income taxes and equity in earnings of affiliated companies		734,945			741,735			6,790
Provision for income taxes		227,428			225,019			(2,409	)
Equity in earnings of affiliated companies		106,052			96,399			(9,653	)
Net income		613,569			613,115			(454	)
Less – Net income attributable to noncontrolling interests		(28,483	)		(21,113	)		7,370
Net income attributable to Toyota Motor Corporation		585,086			592,002			6,916
Note:  Net income attributable to common shareholders for the second quarter ended September 30, 2019 and 2018 is 587,681 million yen and 581,389 million yen, respectively, which is derived by deducting dividend and accretion to Model AA Class Shares of 4,321 million yen and 3,697 million yen, respectively, from Net income attributable to Toyota Motor Corporation.
	(Yen)
Net income attributable to Toyota Motor Corporation per common share
Basic		202.20			209.49			7.29
Diluted		200.21			207.55			7.34

6

TOYOTA MOTOR CORPORATION    FY2020 Second Quarter Financial Summary

Consolidated Statements of Comprehensive Income
	(Yen in millions)
	FY2019 second quarter (Three months ended September 30, 2018)			FY2020 second quarter (Three months ended September 30, 2019)			Increase (Decrease)
Net income		613,569			613,115			(454	)
Other comprehensive income (loss), net of tax
Foreign currency translation adjustments		91,139			(108,650	)		(199,789	)
Unrealized gains (losses) on securities		65,771			25,114			(40,657	)
Pension liability adjustments		3,715			3,762			47
Total other comprehensive income (loss)		160,625			(79,774	)		(240,399	)
Comprehensive income		774,194			533,341			(240,853	)
Less – Comprehensive income attributable to noncontrolling interests		(35,000	)		(18,278	)		16,722
Comprehensive income attributable to Toyota Motor Corporation		739,194			515,063			(224,131	)

7

TOYOTA MOTOR CORPORATION    FY2020 Second Quarter Financial Summary

(3) Consolidated Statements of Cash Flows

	(Yen in millions)
	FY2019 first half (Six months ended September 30, 2018)			FY2020 first half (Six months ended September 30, 2019)
Cash flows from operating activities:
Net income		1,297,805			1,314,789
Adjustments to reconcile net income to net cash provided by operating activities
Depreciation		865,307			784,057
Provision (reversal) for doubtful accounts and credit losses		28,999			34,712
Pension and severance costs, less payments		10,161			12,730
Losses on disposal of fixed assets		19,093			24,704
Unrealized losses (gains) on securities		(143,474	)		(154,755	)
Deferred income taxes		65,051			117,807
Equity in earnings of affiliated companies		(222,587	)		(205,952	)
Changes in operating assets and liabilities, and other		(94,167	)		139,473
Net cash provided by operating activities		1,826,188			2,067,565
Cash flows from investing activities:
Additions to finance receivables		(7,878,662	)		(8,434,132	)
Collection of and proceeds from sales of finance receivables		7,358,000			7,752,495
Additions to fixed assets excluding equipment leased to others		(717,435	)		(725,081	)
Additions to equipment leased to others		(1,204,802	)		(1,191,812	)
Proceeds from sales of fixed assets excluding equipment leased to others		26,237			17,747
Proceeds from sales of equipment leased to others		693,712			727,935
Purchases of marketable securities and security investments		(1,089,727	)		(649,927	)
Proceeds from sales of and maturity of marketable securities and security investments		1,289,729			1,241,524
Changes in investments and other assets, and other		(331,318	)		(230,220	)
Net cash used in investing activities		(1,854,266	)		(1,491,471	)
Cash flows from financing activities:
Proceeds from issuance of long-term debt		3,037,778			2,670,506
Payments of long-term debt		(2,201,865	)		(2,162,617	)
Increase in short-term borrowings		13,205			60,976
Dividends paid to Toyota Motor Corporation class shareholders		(3,721	)		(4,969	)
Dividends paid to Toyota Motor Corporation common shareholders		(349,191	)		(339,893	)
Dividends paid to noncontrolling interests		(42,240	)		(38,631	)
Reissuance (repurchase) of treasury stock		(299,595	)		(300,154	)
Net cash provided by (used in) financing activities		154,371			(114,782	)
Effect of exchange rate changes on cash and cash equivalents and restricted cash and cash equivalents		36,933			(68,017	)
Net increase in cash and cash equivalents and restricted cash and cash equivalents		163,226			393,295
Cash and cash equivalents and restricted cash and cash equivalents at beginning of period		3,219,639			3,706,515
Cash and cash equivalents and restricted cash and cash equivalents at end of period		3,382,865			4,099,810

Note: Cash and cash equivalents and restricted cash and cash equivalents for the first half ended September 30, 2019 include restricted cash and cash equivalents of 131,811 million yen and 120,046 million yen at the beginning of the period and the end of the period, respectively. Restricted cash and cash equivalents were included in Prepaid expenses and other current assets in the consolidated balance sheets.

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TOYOTA MOTOR CORPORATION    FY2020 Second Quarter Financial Summary

(4) Going Concern Assumption

  None

(5) Significant Changes in Shareholders’ Equity

 None

2. Other Information

(1) Changes in significant subsidiaries during the current period

 (Changes in specified subsidiaries that caused a change in the scope of consolidation)

  None

(2) Simplified accounting procedures and accounting procedures specific to quarterly consolidated financial statements

 Provision for income taxes

The provision for income taxes is computed by multiplying income before income taxes and equity in earnings of affiliated companies for the first half by estimated annual effective tax rates. These estimated annual effective tax rates reflect anticipated investment tax credits, foreign tax credits and other items, including changes in valuation allowances, that are expected to affect estimated annual effective tax rates.

(3) Changes in accounting principles, procedures, and disclosures for consolidated financial statements

 Adoption of new accounting standard

In February 2016, the Financial Accounting Standards Board (“FASB”) issued updated guidance for leases. This guidance requires lessees to recognize substantially all leases on their balance sheet as aright-of-use asset and a lease liability. The parent company and its consolidated subsidiaries (“Toyota”) adopted this guidance on April 1, 2019 using the modified retrospective method of adoption and elected the transition method that allows for application of the standard at the adoption date. Additionally, Toyota elected the package of practical expedients of not reassessing lease classifications and others for lease contracts that expired or exist as of the adoption date. As a result of adoption, Toyota recognized an additional balance of ¥334,555 million asright-of-use assets as of September 30, 2019, which is included in “Other” of “Investments and other assets” of Toyota’s consolidated balance sheet. Lease liabilities are included in “Other current liabilities” and “Other long-term liabilities,” and were ¥60,551 million and ¥273,799 million, respectively.

In August 2017, the FASB issued updated guidance for hedge accounting. This guidance simplifies and expands the application of hedge accounting. Toyota adopted this guidance on April 1, 2019. The adoption of this guidance did not have a material impact on Toyota’s consolidated financial statements.

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TOYOTA MOTOR CORPORATION    FY2020 Second Quarter Financial Summary

 Change in depreciation method

Toyota used the declining-balance method mainly for the parent company and Japanese subsidiaries, and the straight-line method for foreign subsidiary companies, regarding the depreciation method of property, plant and equipment. In recent years, Toyota has been strengthening competitiveness globally through the investments in areas such as the remodeling of cars by introducing a new platform and powertrain units, the improvement of technological capabilities and productivity, as well as the promotion of equipment versatility. In response to such recent changes, effective as of April 1, 2019, Toyota changed the depreciation method of the parent company and Japanese subsidiaries to the straight-line method because Toyota believes it better reflects the future economic benefit from the stable usage of property, plant and equipment. The impact of the change in depreciation method is recognized prospectively as a change in accounting estimate in accordance with the FASB Accounting Standards Codification (ASC) 250 “Accounting Changes and Error Corrections”.

As a result of the change in depreciation method, depreciation expense for the first half ended September 30, 2019 decreased by ¥80,555 million. Net income attributable to Toyota Motor Corporation and basic net income attributable to Toyota Motor Corporation per common share for the first half ended September 30, 2019 increased by ¥54,246 million and ¥19.25, respectively.

10

Supplemental Material for Financial Results for FY2020 Second Quarter (Consolidated)

< U.S. GAAP >

	FY2019																		FY2020									FY2020
	1Q (2018/4-6)			2Q (2018/7-9)			First Half 6 months (2018/4-9)			3Q (2018/10-12)			4Q (2019/1-3)			12 months (’18/4-’19/3)			1Q (2019/4-6)			2Q (2019/7-9)			First Half 6 months (2019/4-9)			Forecast 12 months (’19/4-’20/3)
Vehicle Production (thousands of units)		2,199			2,184			4,383			2,262			2,340			8,985			2,311			2,236			4,547
(Japan) – including Daihatsu & Hino		1,003			1,004			2,007			1,099			1,203			4,309			1,134			1,122			2,256
[Daihatsu & Hino]		[257	]		[257	]		[514	]		[290	]		[292	]		[1,096	]		[265	]		[275	]		[540	]
(Overseas) – including Daihatsu & Hino		1,196			1,180			2,376			1,163			1,138			4,676			1,178			1,114			2,291
[Daihatsu & Hino]		[133	]		[162	]		[295	]		[161	]		[141	]		[598	]		[124	]		[155	]		[280	]
North America		517			447			964			435			442			1,841			499			456			955
Europe		168			159			326			173			180			679			174			143			317
Asia		402			449			851			429			402			1,682			386			413			799
Central and South America		82			93			176			96			82			353			86			69			156
Africa		28			31			59			30			32			121			33			32			65
Vehicle Sales (thousands of units)		2,236			2,183			4,419			2,282			2,276			8,977			2,303			2,335			4,639			8,950
(Japan) – including Daihatsu & Hino		510			521			1,031			565			631			2,226			555			585			1,140			2,240
[Daihatsu & Hino]		[155	]		[161	]		[316	]		[169	]		[203	]		[688	]		[158	]		[183	]		[341	]		[670	]
(Overseas) – including Daihatsu & Hino		1,726			1,662			3,388			1,717			1,645			6,751			1,748			1,750			3,499			6,710
[Daihatsu & Hino]		[75	]		[87	]		[162	]		[89	]		[86	]		[337	]		[65	]		[76	]		[141	]		[300	]
North America		746			665			1,411			680			654			2,745			744			702			1,446			2,690
Europe		253			240			493			232			269			994			274			250			524			1,030
Asia		394			417			811			464			410			1,684			398			431			829			1,630
Central and South America		117			120			237			114			97			448			104			109			212			420
Oceania		72			74			146			66			60			272			66			64			130			260
Africa		48			50			98			54			48			200			54			63			117			220
Middle East		93			95			188			105			104			398			106			128			234			460
Other		2			2			4			2			2			8			4			4			8
Total Retail Unit Sales (thousands of units) [Toyota, Daihatsu and Hino]		2,616			2,677			5,293			2,707			2,602			10,603			2,709			2,745			5,454			10,700
Housing Sales (units)		1,892			4,808			6,700			2,656			5,777			15,133			2,164			4,821			6,985

Supplemental 1

Supplemental Material for Financial Results for FY2020 Second Quarter (Consolidated)

< U.S. GAAP >

	FY2019																		FY2020									FY2020
	1Q (2018/4-6)			2Q (2018/7-9)			First Half 6 months (2018/4-9)			3Q (2018/10-12)			4Q (2019/1-3)			12 months (’18/4-’19/3)			1Q (2019/4-6)			2Q (2019/7-9)			First Half 6 months (2019/4-9)			Forecast 12 months (’19/4-’20/3)
Foreign Exchange Rates
Yen to US Dollar Rate		109			111			110			113			110			111			110			107			109			as premise: 107
Yen to Euro Rate		130			130			130			129			125			128			123			119			121			as premise: 118
Market Share (Japan)
Toyota (excluding Mini-Vehicles) (%)		46.2			45.2			45.7			47.3			45.1			45.9			49.0			47.6			48.2			approximately: 48.0
Toyota, Daihatsu and Hino (including Mini-Vehicles) (%)		43.8			42.7			43.2			44.9			43.1			43.6			45.2			45.2			45.2
Number of Employees		373,272			371,796			371,796			371,495			370,870			370,870			376,445			374,014			374,014	(Note 1)
Net Revenues (billions of yen)		7,362.7			7,311.2			14,674.0			7,801.5			7,750.1			30,225.6			7,646.0			7,639.5			15,285.5			29,500.0
Geographic Information
Japan		3,865.4			4,012.3			7,877.8			4,259.8			4,487.7			16,625.3			4,178.5			4,250.8			8,429.4
North America		2,791.1			2,636.4			5,427.5			2,753.7			2,635.9			10,817.2			2,833.5			2,681.7			5,515.3
Europe		785.8			795.8			1,581.7			784.0			873.0			3,238.8			862.1			818.7			1,680.8
Asia		1,316.2			1,318.7			2,634.9			1,496.5			1,381.4			5,513.0			1,314.3			1,367.3			2,681.6
Other		598.4			608.3			1,206.8			592.8			533.7			2,333.4			550.0			548.2			1,098.2
Elimination		-1,994.4			-2,060.4			-4,054.9			-2,085.5			-2,161.7			-8,302.2			-2,092.5			-2,027.4			-4,119.9
Business Segment
Automotive		6,633.4			6,514.8			13,148.3			7,018.4			6,912.2			27,079.0			6,880.9			6,808.1			13,689.0
Financial Services		516.8			534.4			1,051.3			552.4			549.8			2,153.5			547.7			541.4			1,089.1
All Other		358.0			412.3			770.4			391.2			514.6			1,676.3			370.6			454.9			825.5
Elimination		-145.6			-150.3			-296.0			-160.6			-226.6			-683.3			-153.1			-165.0			-318.2
Operating Income (billions of yen)		682.6			579.1			1,261.8			676.1			529.5			2,467.5			741.9			662.3			1,404.3			2,400.0
(Operating Income Ratio) (%)		(9.3	)		(7.9	)		(8.6	)		(8.7	)		(6.8	)		(8.2	)		(9.7	)		(8.7	)		(9.2	)		(8.1	)
Geographic Information
Japan		395.9			354.2			750.2			494.2			447.2			1,691.6			436.8			391.3			828.1
North America		63.5			47.4			110.9			18.1			-14.5			114.5			118.9			118.0			237.0
Europe		23.0			38.1			61.2			27.9			35.6			124.8			37.7			37.1			74.9
Asia		146.3			137.1			283.4			116.7			57.2			457.4			110.9			110.6			221.6
Other		43.2			22.7			65.9			19.1			5.9			91.1			22.8			26.7			49.5
Elimination		10.4			-20.5			-10.0			-0.1			-1.9			-12.1			14.5			-21.5			-7.0
Business Segment
Automotive		602.5			462.2			1,064.7			581.3			392.7			2,038.8			621.4			492.9			1,114.3
Financial Services		73.5			81.4			154.9			82.6			85.1			322.8			108.2			119.6			227.8
All Other		11.4			29.3			40.8			13.9			50.7			105.5			13.7			27.8			41.5
Elimination		-4.8			6.1			1.2			-1.8			0.9			0.3			-1.4			21.9			20.5
Income before Income Taxes (billions of yen)		813.8			734.9			1,548.8			176.9			559.6			2,285.4			841.7			741.7			1,583.4			2,630.0
(Income before Income Taxes Ratio) (%)		(11.1	)		(10.1	)		(10.6	)		(2.3	)		(7.2	)		(7.6	)		(11.0	)		(9.7	)		(10.4	)		(8.9	)
Equity in Earnings of Affiliated Companies (billions of yen)		116.5			106.0			222.5			32.2			105.2			360.0			109.5			96.3			205.9			370.0
Net Income (billions of yen)		657.3			585.0			1,242.3			180.9			459.5			1,882.8			682.9			592.0			1,274.9			2,150.0	(Note 2)
(Net Income Ratio) (%)		(8.9	)		(8.0	)		(8.5	)		(2.3	)		(5.9	)		(6.2	)		(8.9	)		(7.7	)		(8.3	)		(7.3	)
Dividends
Common Shares
Cash Dividends (billions of yen)		—			286.9			286.9			—			339.8			626.8			—			278.9			278.9	(Note 3)
Cash Dividends per Share (yen)		—			100			100			—			120			220			—			100			100
Payout Ratio (%)		—			23.4			23.4			—			54.0			33.8			—			22.2			22.2
Model AA Class Shares
Cash Dividends (billions of yen)		—			4.9			4.9			—			4.9			9.9			—			6.2			6.2	(Note 3)
Cash Dividends per Share (yen)		—			105.5			105.5			—			105.5			211			—			132			132
Value of Shares Repurchased (billions of yen)[actual purchase]		129.1			170.8			299.9			151.7			98.1			549.9			54.2			245.8			300.0	(Note 4)
Value of Shares Repurchased (billions of yen)[shareholder return]		—			249.9			249.9			—			300.0			550.0			—			200.0 (maximum	)		200.0 (maximum	(Note 4)  )(Note 5)
Number of Outstanding Common Shares (thousands)		3,262,997			3,262,997			3,262,997			3,262,997			3,262,997			3,262,997			3,262,997			3,262,997			3,262,997
Number of Outstanding Model AA Class Shares (thousands)		47,100			47,100			47,100			47,100			47,100			47,100			47,100			47,100			47,100

Supplemental 2

Supplemental Material for Financial Results for FY2020 Second Quarter (Consolidated)

< U.S. GAAP >

	FY2019												FY2020							FY2020
	1Q (2018/4-6)		2Q (2018/7-9)		First Half 6 months (2018/4-9)		3Q (2018/10-12)		4Q (2019/1-3)		12 months (’18/4-’19/3)		1Q (2019/4-6)		2Q (2019/7-9)		First Half 6 months (2019/4-9)			Forecast 12 months (’19/4-’20/3)
R&D Expenses (billions of yen)		268.5		258.5		527.1		274.4		247.3		1,048.8		297.4		286.9		584.4			1,100.0
Depreciation Expenses (billions of yen)		217.7		255.3		473.1		248.1		263.6		984.8		198.0		190.9		389.0			860.0	*1 (Note 6)
Geographic Information
Japan		108.5		148.1		256.6		142.6		148.9		548.2		88.9		92.2		181.1			420.0
North America		49.8		50.6		100.4		51.2		57.4		209.1		53.8		46.8		100.7			210.0
Europe		14.1		11.3		25.4		11.1		12.1		48.7		13.1		12.7		25.9			60.0
Asia		36.5		36.0		72.6		34.2		34.9		141.9		33.9		30.5		64.4			130.0
Other		8.6		9.1		17.7		8.8		10.1		36.7		8.2		8.4		16.7			40.0
Capital Expenditures (billions of yen)		311.8		307.6		619.5		329.1		517.1		1,465.8		276.5		349.9		626.5			1,450.0	(Note 6)
Geographic Information
Japan		143.6		167.5		311.2		156.0		263.3		730.6		146.6		183.8		330.5			780.0
North America		106.6		75.6		182.2		76.1		153.9		412.4		75.4		81.4		156.8			320.0
Europe		15.1		30.9		46.0		43.8		44.0		133.8		19.4		18.7		38.1			120.0
Asia		25.2		15.9		41.2		34.3		37.8		113.3		19.5		47.7		67.2			140.0
Other		21.2		17.5		38.7		18.7		17.9		75.5		15.5		18.1		33.6			90.0
Total Liquid Assets (billions of yen)		9,005.4		9,562.6		9,562.6		9,198.8		9,454.4		9,454.4		9,143.2		9,452.0		9,452.0	(Note 7)
Total Assets (billions of yen)		51,049.1		52,516.0		52,516.0		51,085.9		51,936.9		51,936.9		52,117.4		52,240.0		52,240.0
Toyota Motor Corporation Shareholders’ Equity (billions of yen)		18,946.9		19,511.3		19,511.3		19,089.2		19,348.1		19,348.1		19,527.6		19,795.6		19,795.6
Return on Equity (%)		13.9		12.1		12.9		3.7		9.5		9.8		14.0		12.0		12.9
Return on Asset (%)		5.2		4.5		4.8		1.4		3.6		3.7		5.3		4.5		4.9
Number of Consolidated Subsidiaries (including Variable Interest Entities)												608
No. of Affil. Accounted for Under the Equity Method												63

Analysis of Consolidated Net Income for FY2020 (billions of yen, approximately)	2Q (2019/7-9)	First Half 6 months  (2019/4-9)	(Note 2)
Marketing Efforts	105.0	185.0
Effects of Changes in Exchange Rates	-110.0	-90.0
Cost Reduction Efforts	45.0	60.0
From Engineering	30.0	35.0
From Manufacturing and Logistics	15.0	25.0
Increase or decrease in expenses and expense reduction efforts	-45.0	-120.0
Other	88.2	107.4
(Changes in Operating Income)*1*2	83.2	142.4
Non-operating Income*2	-76.4	-107.8
Equity in Earnings of Affiliated Companies*2	-9.6	-16.6
Income Taxes, Net Income Attributable to Noncontrolling Interests*1*2	9.7	14.5
(Changes in Net Income)*1*2	6.9	32.5	(Note 2)

*1 Toyota changed the depreciation method of the parent company and Japanese subsidiaries to the straight-line method, effective as of April 1, 2019.

The impact of this change for the second quarter ended September 30, 2019 was a decrease in depreciation expense of 80.6 billion yen and an increase in net income attributable to Toyota Motor Corporation of 54.2 billion yen. The impact of this change for the fiscal year ending March 31, 2020 (Forecast) is expected to be a decrease in depreciation expense of approximately 165.0 billion yen and an increase in net income attributable to Toyota Motor Corporation of approximately 110.0 billion yen.

*2 Net income attributable to Toyota Motor Corporation for the second quarter ended September 30, 2019 and 2018 includes a profit of 113.7 billion yen and 85.3 billion yen, respectively, which is attributable to the effect of unrealized gains (losses) on equity securities (net of tax, etc.).

Supplemental 3

Supplemental Material for Financial Results for FY2020 Second Quarter (Unconsolidated)

< Japan GAAP >

	FY2019																		FY2020									FY2020
	1Q (2018/4-6)			2Q (2018/7-9)			First Half 6 months (2018/4-9)			3Q (2018/10-12)			4Q (2019/1-3)			12 months (’18/4-’19/3)			1Q (2019/4-6)			2Q (2019/7-9)			First Half 6 months (2019/4-9)			Forecast 12 months (’19/4-’20/3)
Toyota & Lexus brand
Domestic Vehicle Production (thousands of units)		746			748			1,493			809			911			3,213			869			847			1,716			3,330
Overseas Vehicle Production (thousands of units)		1,451			1,443			2,895			1,447			1,382			5,724			1,481			1,354			2,835			5,670
Domestic Vehicle Retail Sales (thousands of units)		359			381			740			384			445			1,569			386			435			821			1,580
Exports Vehicle Sales (thousands of units)		464			461			925			484			538			1,947			536			529			1,065			2,010
North America		191			197			388			190			246			824			222			210			433			760
Europe		65			56			121			61			80			262			78			69			147			280
Asia		76			83			159			96			82			337			102			105			207			410
Central and South America		16			11			27			8			12			47			13			13			26			50
Oceania		46			43			89			45			38			172			43			45			87			180
Africa		14			14			28			15			16			59			17			20			36			70
Middle East		54			55			109			67			62			238			60			65			125			260
Other		2			2			4			2			2			8			2			2			5
Net Revenues (billions of yen)		2,980.3			3,026.3			6,006.6			3,294.7			3,333.0			12,634.4			3,282.6			3,214.6			6,497.3			12,500.0
Domestic		923.9			949.9			1,873.9			1,083.3			1,131.2			4,088.5			1,049.6			1,046.7			2,096.4
Exports		2,056.3			2,076.3			4,132.7			2,211.4			2,201.7			8,545.8			2,232.9			2,167.9			4,400.8
Operating Income (billions of yen)		308.7			284.5			593.3			400.9			331.9			1,326.1			328.2			209.7			537.9			820.0
(Operating Income Ratio) (%)		(10.4	)		(9.4	)		(9.9	)		(12.2	)		(10.0	)		(10.5	)		(10.0	)		(6.5	)		(8.3	)		(6.6	)
Ordinary Income (billions of yen)		714.8			507.6			1,222.5			605.0			495.5			2,323.1			615.1			401.3			1,016.4			1,580.0
(Ordinary Income Ratio) (%)		(24.0	)		(16.8	)		(20.4	)		(18.4	)		(14.9	)		(18.4	)		(18.7	)		(12.5	)		(15.6	)		(12.6	)
Net Income (billions of yen)		591.5			397.7			989.3			504.8			402.6			1,896.8			514.0			333.3			847.3			1,320.0
(Net Income Ratio) (%)		(19.8	)		(13.1	)		(16.5	)		(15.3	)		(12.1	)		(15.0	)		(15.7	)		(10.4	)		(13.0	)		(10.6	)
R&D Expenses (billions of yen)		234.4			225.1			459.6			234.8			201.6			896.2			256.8			246.9			503.8			940.0
Depreciation Expenses (billions of yen)		52.6			57.3			109.9			61.7			65.7			237.5			52.4			56.6			109.1			240.0
Capital Expenditures (billions of yen)		73.6			61.8			135.5			62.5			104.0			302.1			50.4			59.9			110.4			300.0

Analysis of Unconsolidated Net Income for FY2020 (billions of yen, approximately)	2Q (2019/7-9)		First Half 6 months (2019/4-9)
Marketing Efforts		-5.0		30.0
Effects of Changes in Exchange Rates		-55.0		-15.0
Cost Reduction Efforts		40.0		55.0
From Engineering		35.0		45.0
From Manufacturing and Logistics		5.0		10.0
Increase or decrease in expenses and expense reduction efforts		-55.0		-125.0
Other		0.2		-0.3
(Changes in Operating Income)		-74.8		-55.3
Non-operating Income		-31.5		-150.7
Income Taxes, etc.		41.9		64.1
(Changes in Net Income)		-64.4		-141.9

Cautionary Statement with Respect to Forward-Looking Statements

This report contains forward-looking statements that reflect Toyota’s plans and expectations.

These forward-looking statements are not guarantees of future performance and involve known and unknown risks, uncertainties and other factors that may cause Toyota’s actual results, performance, achievements or financial position to be materially different from any future results, performance, achievements or financial position expressed or implied by these forward-looking statements. These factors include, but are not limited to: (i) changes in economic conditions, market demand, and the competitive environment affecting the automotive markets in Japan, North America, Europe, Asia and other markets in which Toyota operates; (ii) fluctuations in currency exchange rates, particularly with respect to the value of the Japanese yen, the U.S. dollar, the euro, the Australian dollar, the Russian ruble, the Canadian dollar and the British pound, fluctuations in stock prices, and interest rates fluctuations; (iii) changes in funding environment in financial markets and increased competition in the financial services industry; (iv) Toyota’s ability to market and distribute effectively; (v) Toyota’s ability to realize production efficiencies and to implement capital expenditures at the levels and times planned by management; (vi) changes in the laws, regulations and government policies in the markets in which Toyota operates that affect Toyota’s automotive operations, particularly laws, regulations and government policies relating to vehicle safety including remedial measures such as recalls, trade, environmental protection, vehicle emissions and vehicle fuel economy, as well as changes in laws, regulations and government policies that affect Toyota’s other operations, including the outcome of current and future litigation and other legal proceedings, government proceedings and investigations; (vii) political and economic instability in the markets in which Toyota operates; (viii) Toyota’s ability to timely develop and achieve market acceptance of new products that meet customer demand; (ix) any damage to Toyota’s brand image; (x) Toyota’s reliance on various suppliers for the provision of supplies; (xi) increases in prices of raw materials; (xii) Toyota’s reliance on various digital and information technologies; (xiii) fuel shortages or interruptions in electricity, transportation systems, labor strikes, work stoppages or other interruptions to, or difficulties in, the employment of labor in the major markets where Toyota purchases materials, components and supplies for the production of its products or where its products are produced, distributed or sold; and (xiv) the impact of natural calamities including the negative effect on Toyota’s vehicle production and sales.

A discussion of these and other factors which may affect Toyota’s actual results, performance, achievements or financial position is contained in Toyota’s annual report on Form20-F, which is on file with the United States Securities and Exchange Commission.

(Note 1) Shows the number of employees as of the end of each period (excluding loan employees from Toyota and its consolidated subsidiaries (“Toyota”) to outside Toyota and including loan employees from outside Toyota to Toyota)

(Note 2) Shows “Net income attributable to Toyota Motor Corporation”

(Note 3) 2Q= Interim Dividend, 4Q=Year-end Dividend, FY= Annual Dividend

(Note 4) Value of common shares repurchased (excluding shares constituting less than one unit that were purchased upon request)

(Note 5) Value of common shares repurchased (shareholder return on Net Income for the period)

(Note 6) Figures for depreciation expenses and capital expenditures do not include vehicles in operating lease

The amounts include finance lease assets until the fiscal year ended March 31, 2019, whereas it does not for the fiscal year ending March 31, 2020.

(Note 7) Cash and cash equivalents, time deposits, marketable debt securities and its investment in monetary trust funds, excluding in each case those relating to financial services

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