Yamaha Motor Co., Ltd. (the “Company”) has released its consolidated business results for the six months ended June 30, 2010. Net sales increased 16.7 percent from the same period of the previous fiscal year, to 676.2 billion yen, due mainly to increased motorcycle sales in Asia (excluding Japan) and favorable sales for surface mounters and automobile engines, in line with a demand recovery. However, sales in Europe and the United States decreased, reflecting a demand decline. In terms of profits, the Company recorded operating income of 35.0 billion yen, an improvement of 68.9 billion yen; ordinary income of 43.8 billion yen, an improvement of 80.7 billion yen; and net income of 23.8 billion yen, an improvement of 98.5 billion yen. These profits were principally derived from increased motorcycle sales in Asia (excluding Japan), gains realized through profitability structure reform at businesses in developed nations, and reduced expenses. On the foreign exchange front, the average exchange rate of the yen during the period under review appreciated by five yen from the same period of the previous fiscal year against the U.S. dollar, to 91 yen, and by six yen against the euro, to 121 yen. Broken down by business segment, motorcycle sales rose 16.2 percent from the same period of the previous fiscal year, to 476.5 billion yen. In Asia (excluding Japan) where demand growth was robust, sales increased 50.8 percent, to 310.1 billion yen. However, sales in North America and Europe decreased, due mainly to falling demand and market stock adjustments in the United States, along with a decrease in demand from Europe. Marine product sales increased 15.1 percent, to 95.8 billion yen, reflecting expanded wholesale shipments following the completion of market stock adjustments, coupled with the positive impact of new model releases. Power product sales dropped 6.5 percent, to 44.4 billion yen. The decrease was attributable to a continued decline in demand for all-terrain vehicles in Europe and the United States. Sales in the “other products” segment soared 53.8 percent, to 59.5 billion yen, driven by a significant sales increase for surface mounters in China and South Korea, and robust sales for automobile engines and electrically power assisted bicycles. Meanwhile, operating income from the motorcycle segment improved by 28.0 billion yen from the same period of the previous fiscal year, to 26.0 billion yen. Operating income from the marine product segment grew by 14.0 billion yen, to 4.2 billion yen. Operating loss from the power product segment totaled 4.2 billion yen, an improvement of 15.9 billion yen. Operating income from the “Other products” segment increased by 11.0 billion yen, to 9.0 billion yen. Positive factors affecting operating income include a 29.3 billion yen rise from the same period of the previous fiscal year in gross profit due to increased sales; a 9.5 billion yen growth in marginal profit resulting from expanded production volumes in Japan; a drop in selling, general and administrative expenses totaling 20.3 billion yen; a reduction in depreciation expenses of 8.6 billion yen; cost reductions in procurement operations totaling 3.8 billion yen; and a 1.4 billion yen decrease in research and development expenses, caused by budget delays. These far exceeded the effects of negative factors, including raw material price fluctuations totaling 1.9 billion yen; the impact of exchange translation amounting to 0.1 billion yen; and a 2.1 billion yen change in the product mix and related factors. The number of consolidated subsidiaries and companies accounted for by the equity method at the end of the period was unchanged from the end of the same period of the previous fiscal year, standing at 107 and 33, respectively. Forecast business results With the yen expected to remain strong against other major currencies and raw material prices likely to rise, sales of motorcycles, all-terrain vehicles and other products in Europe, the United States and other developed nations are forecast to fall below the originally announced figures. On the other hand, motorcycle sales in ASEAN countries and other emerging nations are projected to increase from the original forecasts. In light of these anticipated gains and further reductions expected in expenses, the Company has revised upward its consolidated forecast business results for the full fiscal year ending December 31, 2010. The revised forecast calls for 1,300 billion yen in net sales, an increase of 50 billion yen from the previous forecast officially announced on February 12, 2010; 45 billion yen in operating income, an increase of 35 billion yen; 55 billion yen in ordinary income, an increase of 45 billion yen; and 25 billion yen in net income, an increase of 25 billion yen. These forecast figures are based on the assumption that the U.S. dollar will trade at 88 yen during the period (an appreciation of 6 yen from fiscal 2009), and the euro at 115 yen (an appreciation of 15 yen from fiscal 2009).