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Stock Code:6723

Japanese

Overview of Renesas Electronics

Takao Endo Representative Director & President Renesas Electronics Corporation

I wish to express my thanks to all the shareholders of Renesas Electronics for your kind consideration.

The Renesas Group, with the aim of becoming a global corporation capable of surviving the vicissitudes of the worldwide semiconductor market over the long term and contributing to the development of society and industry, launched "Reform Plans" in October 2013 emphasizing the concept of changing to a market-oriented, profit-oriented, and globally-oriented approach. With this as a basis, the entire Group has been working as a team to implement reforms focused on the two key goals of "improving profitability through structural reforms" and "achieving further growth in profits through selection and concentration of businesses."

"Improving profitability through structural reforms" has involved focusing on a variety of structural reforms spanning the entirety of our operations and intended to establish a robust business culture that will enable the Renesas Group to reliably generate operating profit regardless of the business climate.

"Achieving further growth in profits through selection and concentration of businesses" consists of the identification of five business domains that embody the strengths of the Renesas Group at the global level and where we anticipate stable revenue growth: "Automotive Control", "Automotive Information", "Industrial/HE (Home Electronics)", "OA (Office Automation)/ICT (Information Communication Technology)" and "Other General-Purpose Products". In order to improve our product mix, boost product competitiveness, and raise our gross margin ratio, we are concentrating the management resources of the Renesas Group within these domains, and we are working to improve or phase out unprofitable products and transactions.

As a result of these efforts, net income for the fiscal year ended March 31, 2015 was firmly in the black at 82.4 billion yen. This is the first time Renesas Electronics Corporation has ended a fiscal year in the black since the company started an operation with the current name in 2010.

"Improving profitability through structural reforms" and "achieving further growth in profits through selection and concentration of businesses" will continue to be important priorities for the Renesas Group in the fiscal year ending March 31, 2016. By successfully bringing to a conclusion the restructuring of business and production operations that has been ongoing up to this point, we will have established a management base capable of withstanding sudden fluctuations in the business climate and changes in the structure of the market. In addition, we plan to undertake growth investment in fields that are key to our ability to withstand the fierce competition of the global semiconductor market and thereby increase the shareholder value of the Renesas Group from a medium- and long-term perspective.

The Renesas Group is committed to meeting the expectations of shareholders by implementing the above-mentioned measures on a companywide basis and, furthermore, to working under new leadership to achieve increased profitability as we shift gears toward growth and stable business performance. We look forward to your continued understanding and support in these efforts.

Sincerely,
June 2015
Takao Endo, Representative Director, Chairman and CEO
Renesas Electronics Corporation

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