FY2011	FY2012
	3Q	1Q	2Q	3Q
					Change (Q on Q)	Difference (Q on Q)	Change (Y on Y)
Net Sales	589.0	458.6	645.5	678.2	+5.1%	+32.7	+15.1%
Operating Income	-24.4 (-4.2%)	-94.1 (-20.5%)	-74.7 (-11.6%)	2.6 (0 4%)	-	+77.4	-
Net Income	-173.6 (-29.5%)	-138.4 (-30.2%)	-249.1 (-38.6%)	-36.7 (-5.4%)	-	+212.4	-

Consolidated financial results for the third quarter (October to December, 2012) recorded net sales of 678.2 billion yen, up 5.1% compared to the second quarter, and up 15.1% compared to the same period last year, pointing to a healthy recovery.
Operating income was 2.6 billion yen, returning to profitability for the first time in the last five quarters. Net loss was 36.7 billion yen. For each result, we were able to achieve a significant improvement compared to the same period last year and to the previous quarter.

		FY2011	FY2012
		3Q	1Q	2Q	3Q
						Change (Q on Q)	Difference (Q on Q)	Change (Y on Y)
	Audio-Visual and Communication Equipment	270.2	134.1	204.4	202.3	-1.0%	-2.0	-25.1%
	Health and Environmental Equipment	72.7	78.2	76.7	74.8	-2.4%	-1.8	+2.9%
	Information Equipment	63.5	64.7	74.4	69.7	-6.3%	-4.6	+9.8%
	Consumer/Information Products	406.5	277.2	355.6	346.9	-2.4%	-8.6	-14.6%
	LCDs	173.1	145.9	222.0	258.2	+16.3%	+36.1	+49.1%
	Solar Cells	48.9	41.9	51.1	55.9	+9.4%	+4.7	+14.4%
	Other Electronic Devices	59.8	47.4	78.5	81.4	+3.7%	+2.9	+36.1%
	Electronic Components	281.9	235.2	351.7	395.6	+12.5%	+43.9	+40.3%
Sub Total		688.4	512.5	707.3	742.6	+5.0%	+35.2	+7.9%
Adjustments		-99.3	-53.9	-61.7	-64.3	-	-2.5	-
Total		589.0	458.6	645.5	678.2	+5.1%	+32.7	+15.1%

Net sales for both the second and third quarter have recovered to the level of the first half of fiscal 2011, after bottoming out in the first quarter of fiscal 2012. Although sales of Consumer/Information Products declined slightly from the previous quarter, sales increased in the Electronic Components, especially in LCDs.
As a result, net sales as a whole improved by 32.7 billion yen compared to the previous quarter.

		FY2011	FY2012
		3Q	1Q	2Q	3Q
						Change (Q on Q)	Difference (Q on Q)	Change (Y on Y)
	Audio-Visual and Communication Equipment	-3.9	-20.2	-0.9	5.3	-	+6.2	-
	Health and Environmental Equipment	8.2	8.2	9.0	7.4	-17.8%	-1.6	-9.0%
	Information Equipment	5.4	2.3	4.6	6.3	+36.9%	+1.7	+15.6%
	Consumer/Information Products	9.7	-9.6	12.7	19.1	+49.6%	+6.3	+96.2%
	LCDs	-20.8	-63.4	-52.0	-11.7	-	+40.2	-
	Solar Cells	-6.2	-6.9	-5.3	-1.9	-	+3.4	-
	Other Electronic Devices	2.1	-5.0	-18.7	3.1	-	+21.9	+45.5%
	Electronic Components	-24.8	-75.4	-76.1	-10.4	-	+65.6	-
Sub Total		-15.0	-85.1	-63.3	8.6	-	+72.0	-
Adjustments		-9.3	-9.0	-11.3	-5.9	-	+5.3	-
Total		-24.4	-94.1	-74.7	2.6	-	+77.4	-

After bottoming out in the first quarter of fiscal 2012, operating income is now on track for recovery, and we were able to achieve a turnaround for the first time in the last five quarters.
In Consumer/Information Products, Audio-Visual and Communication Equipment returned to profitability from a loss posted in the same period last year and in the previous quarter. One of our main products in this product group, LCD TVs, returned to profitability due to steady sales increases and the effect of cost reductions. In the mobile phone business, robust sales of the models equipped with IGZO LCDs also contributed to the improvement in profitability of Audio-Visual and Communication Equipment. In Electronic Components, losses for Solar Cells and LCDs decreased, while Other Electronic Devices returned to profitability after recording a loss in the second quarter.
As a result, overall operating income improved by 77.4 billion yen compared to the second quarter.

Although we had not announced the forecast for the third quarter alone in the previous financial announcement (November 1, 2012), the results exceeded the internal projections and returned to profitability.

Operating income in the third quarter improved compared to the previous quarter, thanks largely to the improvement in LCDs and Other Electronic Devices stemming from the business restructuring carried out in the first half.
In analyzing the factors, the effects of business restructuring, such as reducing fixed costs focusing on labor costs, the inventory write-down recorded in the second quarter, and reduction in depreciation and amortization costs due to the retirement and impairment of noncurrent assets, made a significant contribution to profitability improvement.

In addition, Other Expenses improved from the first quarter and the second quarter. Along with the improvement in operating income, such change led to the improvement of net loss. Restructuring charges of 27.3 billion yen in Other Expenses in the third quarter includes the cost of 25.3 billion yen voluntary retirement program.

At the same time, in the Assets section of the Consolidated Balance Sheet, we made progress in reducing noncurrent assets, and in the Liabilities section, other short-term borrowings increased due to a decrease in balance of commercial papers.

The following is a progress report from the second quarter financial announcement (November 1, 2012) on measures to reinforce Sharp’s business foundations, which we announced on August 2, 2012.

<Off-balance-sheets arrangements of large-size LCD business> We had already achieved it when we made the second quarter financial announcement. <Issuance of new shares through a third-party allotment> New shares of 4.9 billion yen were issued by third-party allotment under the alliance agreement with Qualcomm Incorporated. On the other hand, we are still in discussions with the Hon Hai Group about issuance of new shares by third-party allotment. <Reduction in inventories and noncurrent assets> We are on track for our target of 150.0 billion yen with the result of 114.8 billion yen, aiming at a further reduction in the fourth quarter. <Reduction in capital investment> We are steadily implementing the reduction as planned.
The accumulated total amount in four measures above as a whole was 294.4 billion yen with an achievement rate of 74% against the original target of 400.0 billion yen.
Going forward, we will continue to implement the measures to reinforce business foundations.

Although inventories at the end of December 2012 were 339.9 billion yen, an increase of 14.2 billion yen from the 325.7 billion yen at the end of September, the inventory ratio against monthly turnover declined to 1.72 months from 1.77 months at the end of September, due mainly to the growth in sales. The increase in inventories reflects the effect of the weaker yen at the end of the third quarter. If there had been no impact of the weaker yen, inventories would have been at almost the same level as at the end of September.

A decline in plant and equipment led to a decrease in total assets of 49.2 billion yen from the end of September to 2,171.2 billion yen. As a result, total assets turnover improved significantly from 0.94 at the end of March 2012 to 1.09.

Interest-bearing debt at the end of December 2012 decreased 23.3 billion yen from the end of September, to 1,182.7 billion yen. We will continue our efforts aimed at inventory reduction and asset compression, which we are pushing more strongly than ever, and we will be making further reductions looking ahead to the end of fiscal 2012.