NPC Incorporated : Announcement on the third-quarter financial results.

A
July 6, 2012

Summary of Financial Results for the Third Quarter of Fiscal Year Ending August 31, 2012

(All financial information has been prepared in accordance with the Generally Accepted Accounting Principles in Japan)

Company name:	NPC Incorporated		Listing: Mothers of TSE
Stock code: Representative:	6255 Masafumi Ito, President & CEO	URL: http://www.npcgroup.net

Contact: IR Group, Research and Planning Department
Tel: +81-(0)3-5615-5069
Filing date of securities report: July 13, 2012
Payment date of cash dividends: - Supplementary materials prepared for quarterly financial results: None
Financial results meeting for institutional investors and securities analysts:
None
(All amounts are rounded down to the nearest million yen)

1. Consolidated Financial Results for the Nine Months Ended May 31, 2012 (September 1, 2011 through May 31, 2012)

(1) Consolidated results of operations (Percentages represent year-on-year changes)

	Sales	Operating income	Ordinary income	Net income
9 months ended May 31, 2012 9 months ended May 31, 2011	Million yen 7,187 12,670	% -43.3 33.5	Million yen -497 -1,106	% - -	Million yen -705 -912	% - -	Million yen -1,247 -723	% - -

	Earnings per share	Diluted earnings per share
9 months ended May 31, 2012 9 months ended May 31, 2011	Yen -65.07 -38.95	Yen - -

(2) Consolidated financial position

	Total assets	Net assets	Equity ratio
As of May 31, 2012 As of August 31, 2011	Million yen 16,181 21,628	Million yen 7,296 7,261	% 45.1 33.6

[Reference] Shareholders' equity (million yen): May 31, 2012: 7,296 August 31, 2011: 7,261

2. Dividends

	Dividend per share
	1Q-end	2Q-end	3Q-end	Year-end	Annual
	Yen	Yen	Yen	Yen	Yen
Fiscal year ended August 31, 2011 Fiscal year ending August 31, 2012	-	0.00	-	4.00	4.00
Fiscal year ended August 31, 2011 Fiscal year ending August 31, 2012	-	0.00	-
Fiscal year ending August 31, 2012 (forecast)				4.00	4.00

[Note] Revision of dividend forecast during the period: None

3. Consolidated Forecast for the Year Ending August 31, 2012 (September 1, 2011 through August 31, 2012)

(Percentages represent year-on-year changes)

	Sales	Operating income	Ordinary income	Net income	Earnings per share
Full year	Million yen 10,078	% -39.2	Million yen -734	% -	Million yen -968	% -	Million yen -1,658	% -	Yen -75.21

[Note] Revision of consolidated forecast during the period: None

4. Others

(1) Changes in significant subsidiaries during the period: None

(2) Adoption of simplified accounting methods and special accounting methods: None

(3) Changes in accounting principles, procedures and presentation methods

1) Changes in accounting policies arising from revision of accounting standards: None
2) Other changes: None
3) Changes in accounting estimates: None
4) Restatement: None

(4) Number of shares outstanding (common shares)

1) Number of shares outstanding (including treasury stock) at the end of the period
May 31, 2012: 21,772,576 shares
August 31, 2011: 18,585,120 shares
2) Number of treasury stock at the end of the period
May 31, 2012: 345 shares
August 31, 2011: 146 shares
3) Average number of shares during the period
9 months ended May 31, 2012: 19,167,266 shares
9 months ended May 31, 2011: 18,585,120 shares

* Indication of the implementation status of the quarterly review procedure

The Financial Results for the Third Quarter of Fiscal Year Ending August 31, 2012 is exempt from the quarterly review procedure stipulated in the Financial Instruments and Exchange Act. The quarterly review procedure for the Quarterly Consolidated Financial Statement is in process at the time of disclosure.

* Cautionary statement with respect to forward-looking statements

Forecasts of future performance in these materials are based on assumptions judged to be valid and information currently available to NPC Incorporated, hereinafter referred to as "the Company", and do not guarantee the realization of the future performance stated in these materials. Actual results may differ significantly from these forecasts for a number of factors. Please refer to section 1 on page 3 "(3) Qualitative information about consolidated earnings forecast" for details on the above forecasts.

NPC Incorporated (6255) Financial Results for the Third Quarter of Fiscal Year 2012

1. Qualitative Information Concerning Financial Results for the Third Quarter of FY2012.................................... 2 (1) Qualitative information about consolidated results of operations ............................................................................. 2 (2) Qualitative information about consolidated financial situation................................................................................. 2 (3) Qualitative information about consolidated earnings forecast .................................................................................. 3 2. Consolidated Financial Statements for the Third Quarter Ended May 31, 2012 ...................................................4 (1) Consolidated balance sheet ....................................................................................................................................... 4 (2) Consolidated statement of income ............................................................................................................................ 6 (3) Consolidated statement of cash flows ....................................................................................................................... 7 (4) Going concern assumption ........................................................................................................................................ 8 (5) Note in case when there is a significant fluctuation in the amount of shareholders' equity...................................... 8 (6) Important subsequent events: .................................................................................................................................... 8 3. Other Information ........................................................................................................................................................ 9

Production, Orders and Sales .......................................................................................................................................... 9

1

NPC Incorporated (6255) Financial Results for the Third Quarter of Fiscal Year 2012

1. Qualitative Information Concerning Financial Results for the Third Quarter of FY2012

(1) Qualitative information about consolidated results of operations

During the nine months ended May 31, 2012, the Japanese economy was placed in a severe and uncertain situation, with concerns over a possible downward swing in performance in the export industry, influenced by a recurrence of financial instability in Europe and the continuous strong yen.
In the photovoltaic industry, where the NPC Group, hereinafter referred to as "the Group" belongs, capital expenditure by photovoltaic module manufactures, who are the Group's customers, has been showing a greater-than-expected downturn, due to negative impacts from the economic slowdown in Europe, which has been the largest market in the world, and the uncertainty surrounding the German and Italian feed-in tariff and other subsidy programs. As a result, the orders we received remained at a low level during the period, consequently leading our sales to remain low. In addition, although the Group's effort towards reducing both SG&A and manufacturing expense is successfully progressing, the sales falling short of the amount enough to achieve break-even caused a decline in gross profit.
Moreover, the German subsidiary, NPC-Meier GmbH, providing service and support mainly to customers in Europe, was affected significantly by the weak market environment mentioned above. Therefore, during this quarter, impairment of goodwill and other assets relating to NPC-Meier GmbH amounting 371 million yen was booked as an extraordinary loss.
As a result of the above activities, consolidated net sales for the nine months ended May 31, 2012 were 7,187 million yen,
56.7% of the same period of the previous fiscal year. Operating loss was 497 million yen, compared with an operating loss of 1,106 million yen in the same period of the previous fiscal year. Ordinary loss was 705 million yen, compared with an ordinary loss of
912 million yen in the same period of the previous fiscal year. Net loss was 1,247 million yen, compared with a net loss of 723 million yen in the same period of the previous fiscal year.

(2) Qualitative information about consolidated financial situation

1) Assets, liabilities and net assets

As of the end of the third quarter, total assets decreased by 5,446 million yen to 16,181 million yen, compared with the previous fiscal year end. Major components are as follows:
I. Assets
Current assets decreased by 4,572 million yen to 9,948 million yen. This was primarily due to a decrease of 807 million yen in cash and deposits, a decrease of 1,713 million yen in notes and accounts receivable-trade, a decrease of 826 million yen in work in progress and a decrease of 903 million yen in other current assets. Fixed assets decreased by 875 million yen to
6,231 million yen. This was primarily due to a decrease of 141 million yen in building and structures, net, a decrease of 241 million yen in goodwill and a decrease of 253 million yen in other intangible assets.
II. Liabilities
Liabilities decreased by 5,481 million yen to 8,885 million yen. Current liabilities decreased by 5,272 million yen to
6,810 million yen. This was primarily due to a decrease of 4,543 million yen in notes and accounts payable-trade. Fixed liability decreased by 208 million yen to 2,075 million yen. This was primarily due to a decrease of 529 million yen in long-term loan payable, while there was an increase of 300 million yen in the convertible bond-type bonds with subscription rights to shares.
III. Net assets
Net assets increased by 35 million yen to 7,296 million yen primarily due to an increase of 599 million yen in capital stock, an increase of 599 million yen in capital surplus and an increase of 151 million yen in foreign currency translation adjustment, while there was a decrease of 1,321 million yen in retained earnings.

2) Cash flows

Cash and cash equivalents, hereinafter referred to as "cash," at the end of the third quarter decreased by 807 million yen to
1,827 million yen, compared with the previous fiscal year end. Major components are as follows:

2

NPC Incorporated (6255) Financial Results for the Third Quarter of Fiscal Year 2012

I. Operating activities
Net cash used in operating activities was 1,534 million yen, compared with 3,161 million yen used during the same period of the previous fiscal year. While notes and accounts receivable-trade decreased by 1,712 million yen, loss before income taxes was 1,004 million yen and notes and accounts payable-trade decreased by 4,486 million yen.
II. Investing activities
Net cash provided by investing activities was 73 million yen, compared with 2,127 million yen used during the same period of the previous fiscal year. While there were 129 million yen of proceeds from "other, net", 62 million yen was used for purchase of property, plant and equipment.
III. Financing activities
Net cash provided by financing activities was 654 million yen, compared with 5,076 million yen provided during the same period of the previous fiscal year. This was primarily due to a 1,491 million yen increase in proceeds from issue of bonds, while there was 528 million yen decrease for the repayment of long-term loans payable.

(3) Qualitative information about consolidated earnings forecast

The consolidated earnings forecast for the full year is the same as the forecast in the "Announcement on the Revision of
Business Forecast and Extraordinary Loss" announced on June 29, 2012.

3

NPC Incorporated (6255) Financial Results for the Third Quarter of Fiscal Year 2012

2. Consolidated Financial Statements for the Third Quarter Ended May 31, 2012 (September 1, 2011 through May 31, 2012)

(1) Consolidated balance sheet

Assets
Current assets
(Thousand yen) As of August 31, 2011 As of May 31, 2012
Cash and deposits 2,635,120 1,827,814
Notes and accounts receivable-trade 3,434,662 1,720,767
Merchandise and finished goods 65,725 49,025
Work in progress 6,137,991 5,311,151
Raw materials and supplies 945,611 784,084
Deferred tax assets 216,683 65,511
Other 1,111,193 207,613
Allowance for doubtful accounts -26,222 -17,533
Total current assets 14,520,766 9,948,436
Noncurrent assets
Property, plant and equipment
Buildings and structures 4,292,838 4,298,194
Accumulated depreciation -379,005 -526,247
Building and structures, net 3,913,833 3,771,947
Land 2,063,794 2,063,794
Construction in progress - 1,235
Other 573,481 588,318
Accumulated depreciation -317,658 -375,180
Other, net 255,822 213,138
Total property, plant and equipment 6,233,451 6,050,115
Intangible assets
Goodwill 241,818 - Other 417,564 164,481
Total intangible assets 659,383 164,481
Investments and other assets
Investment securities 22,034 - Deferred tax assets 45,692 - Other 150,548 22,921
Allowance for doubtful accounts -3,516 -5,680
Total investments and other assets 214,758 17,241
Total noncurrent assets 7,107,592 6,231,838
Deferred assets
Bond issuance cost - 1,629
Total deferred assets - 1,629
Total assets 21,628,359 16,181,903

4

NPC Incorporated (6255) Financial Results for the Third Quarter of Fiscal Year 2012

(Thousand yen)
Liabilities
Current liabilities
As of August 31, 2011 As of May 31, 2012
Notes and accounts payable-trade 5,373,317 829,348
Short-term loans payable 3,293,163 3,047,040
Current portion of long-term loans payable 705,246 705,226
Income taxes payable 22,674 11,688
Advances received 1,815,913 1,673,320
Provision for loss on order received 75,735 58,329
Other 797,173 485,313
Total current liabilities 12,083,224 6,810,266
Noncurrent liabilities
Convertible bond-type bonds with subscription rights to shares - 300,000
Long-term loans payable 2,283,741 1,754,474
Deferred tax liabilities 146 20,560
Total noncurrent liabilities 2,283,887 2,075,035
Total liabilities 14,367,112 8,885,301
Net assets
Shareholders' equity
Capital stock 2,174,962 2,774,961
Capital surplus 2,097,376 2,697,375
Retained earnings 3,067,697 1,746,180
Treasury stock -321 -406
Total shareholders' equity 7,339,715 7,218,112
Accumulated other comprehensive income
Valuation difference on available-for-sale securities -4,607 - Deferred gains or losses on hedges 460 936
Foreign currency translation adjustment -74,321 77,553
Total accumulated other comprehensive income -78,468 78,489
Total net assets 7,261,246 7,296,601
Total liabilities and net assets 21,628,359 16,181,903

5

NPC Incorporated (6255) Financial Results for the Third Quarter of Fiscal Year 2012

(2) Consolidated statement of income

(Thousand yen)
9 months ended
May 31, 2011
9 months ended
May 31, 2012
Net sales 12,670,550 7,187,999
Cost of sales 11,645,788 5,902,746
Gross profit 1,024,762 1,285,252
Selling, general and administrative expenses 2,130,824 1,782,465
Operating loss -1,106,062 -497,212
Non-operating income
Interest income 582 539
Dividends income 1,125 - Gain on valuation of derivatives 2,330 345
Insurance premiums refunded cancellation 135,535 53,053
Foreign exchange gains 50,528 - Other 34,706 42,534
Total non-operating income 224,809 96,473
Non-operating expenses
Interest expenses 23,390 47,104
Commission fee 6,803 23,068
Foreign exchange losses - 213,548
Other 1,051 20,615
Total non-operating expenses 31,245 304,336
Ordinary loss -912,498 -705,075
Extraordinary income
Subsidy - 72,035
Total extraordinary income - 72,035
Extraordinary loss
Impairment loss - 371,308
Total extraordinary losses - 371,308
Loss before income taxes and minority interests -912,498 -1,004,349
Income taxes-current 26,745 30,229
Income taxes-deferred -215,445 212,598
Total income taxes -188,699 242,827
Loss before minority interests -723,798 -1,247,177
Net loss -723,798 -1,247,177

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NPC Incorporated (6255) Financial Results for the Third Quarter of Fiscal Year 2012

(3) Consolidated statement of cash flows

Net cash provided by (used in) operating activities
9 months ended
May 31, 2011
(Thousand yen)
9 months ended
May 31, 2012
Loss before income taxes -912,498 -1,004,349
Depreciation and amortization 201,040 287,909
Impairment loss - 371,308
Amortization of goodwill 35,882 28,507
Increase (decrease) in allowance for doubtful accounts 17,730 -6,296
Increase (decrease) in provision for loss on order received 116,681 -15,717
Interest and dividends income -1,707 -539
Interest expenses 23,390 47,104
Loss (gain) on cancellation of insurance contract -135,535 -53,053
Subsidy income - -72,035
Decrease (increase) in notes and accounts receivable-trade -252,374 1,712,136
Decrease (increase) in inventories -2,275,066 950,762
Increase (decrease) in notes and accounts payable-trade -555,496 -4,486,001
Increase (decrease) in advances received 438,968 -118,845
Other, net 84,888 594,125
Subtotal -3,214,095 -1,764,983
Interest and dividends income received 2,405 541
Interest expenses paid -22,498 -47,342
Proceeds from insurance income 135,535 53,053
Proceeds from subsidy - 72,035
Income taxes refund -62,586 152,191
Net cash provided by (used in) operating activities -3,161,239 -1,534,504
Net cash provided by (used in) investing activities
Proceeds from withdrawal of time deposits 1,000,000 - Purchase of property, plant and equipment -1,931,377 -62,989
Proceeds from sales of property, plant and equipment - 807
Purchase of intangible assets -47,737 -3,551
Proceeds from sales of investment securities 1,812 10,475
Payments for transfer of business -1,047,533 - Other, net -102,418 129,132
Net cash provided by (used in) investing activities -2,127,255 73,875
Net cash provided by (used in) financing activities
Net increase (decrease) in short-term loans payable 2,000,000 -235,201
Proceeds from long-term loans payable 3,500,000 - Repayment of long-term loans payable -350,000 -528,766
Proceeds from issuance of bonds - 1,491,850
Purchase of treasury stock - -84
Cash dividends paid -73,915 -73,606
Net cash provided by (used in) financing activities 5,076,084 654,191
Effect of exchange rate change on cash and cash equivalents -586 -869
Net increase (decrease) in cash and cash equivalents -212,997 -807,306
Cash and cash equivalents at beginning of period 1,690,530 2,635,120
Cash and cash equivalents at end of period 1,477,533 1,827,814

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NPC Incorporated (6255) Financial Results for the Third Quarter of Fiscal Year 2012

(4) Going concern assumption: None

(5) Note in case when there is a significant fluctuation in the amount of shareholders' equity:

Due to the partial exercise of the convertible bond-type bonds with subscription rights to shares during the third quarter, the
Company's capital stock and capital surplus increased by 599 million yen respectively, resulting the Company's capital stock being
2,774 million yen and capital surplus being 2,697 million yen, at the end of the third quarter of the fiscal year.

(6) Important subsequent events:

The solicitation of voluntary retirement, as a part of the business reform plan to streamline the management, was approved at the Board of Directors' Meeting held on June 29, 2012.

1) Reasons for the solicitation of voluntary retirement

In the photovoltaic industry, where the Group belongs, the market's demand trend is currently difficult to foresee due to negative impacts of various factors; such as the economic slowdown in Europe, which is the largest market in the world, and the uncertainty surrounding the German and Italian feed-in tariff and other subsidy programs. Consequently, capital expenditure by photovoltaic module manufactures, who are the Group's customers, has been showing a greater-than-expected downturn. Thus the photovoltaic module manufacturing equipment market is shrinking in size.
Under such circumstances, the Group has determined to solicit voluntary retirement, in order to streamline management, in addition to the promotion of the currently ongoing action plans including significant cost reduction.

2) Guidelines for the Solicitation of voluntary retirement

(a) Eligible persons
Permanent employee of NPC Incorporated
Assigned employee to overseas subsidiaries from NPC Incorporated
(b) Number of persons requested for voluntary retirement
Approximately 120 persons
(c) Period of application
July 2 through July 18, 2012 (d) Date of retirement
July 31, 2012
(e) Preferential treatment provided to retiree
Retirees will receive special retirement benefits.

3) Predicted effects of the solicitation of voluntary retirement on the Group's earnings

Special retirement benefits paid to the retirees will be booked as an extraordinary loss during the fiscal year ending August
31, 2012. However, the impact of the loss on the Group's earnings is unspecified for the time being, as the number of applicants remains yet uncertain.

8

NPC Incorporated (6255) Financial Results for the Third Quarter of Fiscal Year 2012

3. Other Information

Production, Orders and Sales

(1) Production

Production amounts of the photovoltaic business, the single segment of the Group, during the period are as follows. (Thousand yen)

Segment	9 months ended May 31, 2012	Year on year changes (%)
Photovoltaic business	6,278,085	44.1

[Notes]: 1. The above amounts are calculated based on selling prices.
2. The above amounts are exclusive of consumption taxes.

(2) Orders

Orders received by the photovoltaic business, the single segment of the Group, during the period are as follows. (Thousand yen)

Segment	Orders received	Year on year ratio (%)	Order backlog	Year on year ratio (%)
Photovoltaic business	3,264,539	22.6	6,260,848	47.3

[Note] The above amounts are exclusive of consumption taxes.

(3) Sales

Sales of the photovoltaic business, the single segment of the Group, during the period are as follows.
(Thousand yen)

Segment	9 months ended May 31, 2012	Year on year ratio (%)
Photovoltaic business	7,187,999	56.7

[Note] The above amounts are exclusive of consumption taxes.
The photovoltaic manufacturing equipment business and the vacuum packaging machines business have been integrated into photovoltaic business under reorganization effective as from December 1, 2011. Therefore, the photovoltaic business is the single segment of the Group from the second quarter of this fiscal year.
Year on year ratio is calculated with the comparison of the sum of two segments during the nine months ended May 31,
2012.

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