Edgar Filing: KYOCERA CORP

Form 6-K

FORM 6-K

SECURITIES AND EXCHANGE COMMISSION

Washington, D. C. 20549

Report of Foreign Private Issuer

Pursuant to Rule 13a-16 or 15d-16 of

the Securities Exchange Act of 1934

For the month of January 2008

Commission File Number: 1-07952

KYOCERA CORPORATION

6 Takeda Tobadono-cho, Fushimi-ku,

Kyoto 612-8501, Japan

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F:

Form 20-F X Form 40-F

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Registration S-T Rule 101(b)(1):

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Registration S-T Rule 101(b)(7):

Indicate by check mark whether by furnishing the information contained in this Form, the registrant is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.

Yes No X

If “Yes” is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b); 82-

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereto duly authorized.


		KYOCERA CORPORATION

		/s/ Akihiko Toyotani
		Akihiko Toyotani
		General Manager of Finance Division
Date: January 29, 2008

Information furnished on this form :

EXHIBITS


Exhibit Number
1.		Consolidated Financial Results of Kyocera Corporation and its Subsidiaries for the Nine Months Ended December 31, 2007
2.		Execution of Corporate Split Agreement regarding Acquisition of Mobile Phone Business of SANYO Electric Co., Ltd

Consolidated Results of Kyocera Corporation and its Subsidiaries

for the Nine Months Ended December 31, 2007

The consolidated financial statements are prepared in conformity with accounting principles generally accepted in the United States of America.

1. Consolidated financial information for the nine months ended December 31, 2007 :

(1) Consolidated results of operations :


	Japanese Yen
	Nine months ended December 31,						Year ended March 31, 2007
	2006			2007			Year ended March 31, 2007
Net sales	¥	955,311 million		¥	966,218 million		¥	1,283,897 million
% change from the previous period		11.1	%		1.1	%

Profit from operations		101,372 million			110,131 million			135,102 million
% change from the previous period		51.6	%		8.6	%

Income from continuing operations before income taxes		116,205 million			131,971 million			156,540 million
% change from the previous period		36.5	%		13.6	%

Net income		79,318 million			83,516 million			106,504 million
% change from the previous period		58.7	%		5.3	%

Earnings per share :
Basic	¥	421.85		¥	441.36		¥	566.03
Diluted		420.97			440.56			564.79

(2) Consolidated financial position :


	Japanese Yen
	December 31,						March 31, 2007
	2006			2007			March 31, 2007
Total assets	¥	2,010,730 million		¥	2,115,064 million		¥	2,130,464 million
Stockholders’ equity		1,422,195 million			1,545,390 million			1,514,560 million
Stockholders’ equity to total assets		70.7	%		73.1	%		71.1	%
Stockholders’ equity per share	¥	7,552.62		¥	8,157.27		¥	8,028.45

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(3) Consolidated cash flows :


	Japanese Yen
	Nine months ended December 31,				Year ended March 31,
	2006		2007		2007
Cash flows from operating activities	¥	70,152 million	¥	110,957 million	¥	149,644 million

Cash flows from investing activities		(100,448) million		(119,915) million		(151,703) million

Cash flows from financing activities		(12,803) million		(20,494) million		(20,645) million

Cash and cash equivalents at end of period		262,374 million		252,070 million		282,208 million

2. Consolidated financial forecast for the year ending March 31, 2008 :


	Japanese Yen
	Year ending March 31, 2008
Net sales	¥	1,290,000 million
% change from the previous year		0.5	%
Profit from operations	¥	140,000 million
% change from the previous year		3.6	%
Income from continuing operations before income taxes	¥	166,000 million
% change from the previous year		6.0	%
Net income	¥	103,000 million
% change from the previous year		(3.3	)%

Notes :

1. Forecast of earnings per share : ¥543.33

Net income per share amount is computed based on the Statement of Financial Accounting Standards Board No.128. Forecast of earnings per share is computed based on the diluted average number of shares outstanding during the nine months ended December 31, 2007.

2. As indicated in our January 21, 2008 press release, the acquisition of SANYO Electronic Co., Ltd. is not expected to have a significant impact in our financial results of operations for the year ending March 31, 2008.

3. With regard to forecasts set forth above, please refer to the accompanying “Forward Looking Statements” on page 14.

3. Change in accounting policies except due to new accounting standards : None

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Business Results, Financial Condition and Prospects

1. Business Results for the nine months Ended December 31, 2007

(1) Economic and Business Environment

Despite increases in exports and capital investment on the back of solid corporate earnings in the nine months ended December 31, 2007 (the nine months), the Japanese economy expanded only moderately due to slowed individual consumption. In the U.S. economy, although individual consumption and capital investment expanded, fears over a deceleration in business environment worsened due to the impact of issues related to housing loans for individuals with low creditworthiness. The European economy was strong on the whole, spurred by steady individual consumption. The Chinese economy continued to expand mainly on account of increases in capital investment and exports.

In the digital consumer equipment market, which is the principal market for Kyocera Corporation and its consolidated subsidiaries (“Kyocera Group” or “Kyocera”), demand for electronic components surpassed the level registered in the nine months ended December 31, 2006 (the previous nine months) due in particular to strong sales of flat panel TV sets and mobile phone handsets, etc.

(2) Consolidated Financial Results

Consolidated net sales for the nine months amounted to ¥966,218 million, an increase of 1.1% compared with the previous nine months, reflecting solid sales of applied ceramic products group, notably solar power generating systems (solar energy business) coupled with sales growth in the Electronic Device Group and the Information Equipment Group.

Profit from operations for the nine months increased by 8.6% to ¥110,131 million compared with the previous nine months due to the positive effect of increased sales of applied ceramic products and information equipment, and a significant improvement in profitability in the telecommunications equipment business in the three months ended December 31, 2007. This was despite an increase in depreciation costs resulting from changes in the depreciation method for fixed assets with taking the business situation into consideration, triggered by the tax revision in Japan.

Income from continuing operations before income taxes increased by 13.6% to ¥131,971 million due to increases in interest and dividend income, and equity in earnings of affiliates and unconsolidated subsidiaries. Net income totaled ¥83,516 million, an increase of 5.3% compared with the previous nine months.


	(Yen in millions, except per share amounts and exchange rate)
	Nine months ended December 31,				Increase (Decrease) (%)
	2006		2007
	Amount	% to net sales	Amount	% to net sales
Net sales	955,311	100.0	966,218	100.0	1.1
Profit from operations	101,372	10.6	110,131	11.4	8.6
Income from continuing operations before income taxes	116,205	12.2	131,971	13.7	13.6
Net income	79,318	8.3	83,516	8.6	5.3
Diluted earnings per share	420.97	—	440.56	—	4.7
Average US$ exchange rate	116	—	117	—	—
Average Euro exchange rate	148	—	163	—	—

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(3) Management Measures Implemented and Significant Management Decisions

1) In September 2007, AVX Corporation (AVX), a U.S. subsidiary, acquired American Technical Ceramics Corp., a U.S.-based manufacturer of electronic components, as a wholly-owned subsidiary, with the goal of strengthening its business in the area of advanced components business such as high frequency ceramic capacitors. This acquisition enables AVX to expand its product line-up and its sales networks for high-value-added products.

2) With the objective of further enhancing the Telecommunications Equipment Group, Kyocera concluded a basic agreement with SANYO Electric Co., Ltd. (SANYO) in October 2007 and also concluded a final agreement in January 2008 regarding acquisition of the mobile phone business of SANYO by Kyocera. This business transfer will be completed in April 2008 principally by means of a corporate split. Through this acquisition, Kyocera seeks to expand sales and boost profitability in the Telecommunications Equipment Group by expanding its sales channels in North America and by integrating the excellent product development and design technologies of SANYO with the management resources of Kyocera.

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(4) Consolidated Financial Results by Reporting Segment

Components Business:

Sales in the Components Business increased by 4.4% compared with the previous nine months to ¥510,041 million, while operating profit decreased by 1.7% to ¥77,005 million. The operating profit ratio was 15.1%.

1) Fine Ceramic Parts Group

This reporting segment includes fine ceramic components and automotive components.

Sales in this reporting segment for the nine months increased compared with the previous nine months due to brisk sales of dielectric ceramic parts for base stations and sapphire substrates for LEDs on the back of growth in the mobile phone market. Sales of parts for diesel engines for automobiles also increased. Operating profit decreased compared with the previous nine months, however, due to an increase in expenses such as depreciation costs.

2) Semiconductor Parts Group

This reporting segment includes ceramic packages and organic packages.

Although sales of Surface Mount Device (SMD) packages for electronic components and of ceramic packages such as packages for image sensors increased steadily, overall segment sales for the nine months remained roughly on par with the previous nine months, when demand was at high level. Operating profit decreased due in part to an increase in depreciation costs compared with the previous nine months.

3) Applied Ceramic Products Group

This reporting segment includes solar power generating systems, cutting tools, dental and medical implants, and jewelry and applied ceramic related products.

Both sales and operating profit increased significantly in this reporting segment compared with the previous nine months due primarily to increased sales in the solar energy business in line with expansion in production volume, in addition to steady growth in sales of new products in the cutting tool business.

4) Electronic Device Group

This reporting segment includes electronic components such as various types of capacitors, crystal related products and connectors, and thin-film products such as thermal printheads and liquid crystal displays.

Overall sales for the nine months increased in this reporting segment compared with the previous nine months due to increased sales gains in ceramic capacitors for flat-panel TV sets and game consoles, and in timing devices for mobile phone handsets, together with sales growth at AVX. Despite the positive effect of increased production, operating profit decreased compared with previous nine months due to an increase in depreciation costs and a decline in income before income taxes of AVX.

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Equipment Business:

Sales in the Equipment Business for the nine months decreased by 2.2% to ¥375,151 million, and operating profit significantly increased by 25.0% to ¥31,503 million compared with the previous nine months. The operating profit ratio was 8.4%.

1) Telecommunications Equipment Group

This reporting segment includes mobile phone handsets as well as PHS base stations and handsets.

Overall sales in this reporting segment for the nine months decreased compared with the previous nine months due mainly to a substantial sales decrease in the overseas market. Operating profit increased considerably, however, due to attained profitability in the PHS related business as a result of concentrating management resources in Japan, and to efforts made for cutting costs in the product development and manufacturing processes, in the domestic mobile phone handsets business.

2) Information Equipment Group

This reporting segment includes ECOSYS brand printers, copiers and digital MFPs.

Both sales and operating profit in this reporting segment for the nine months increased compared with the previous nine months due to sales growth in color printers and MFPs, particularly in Europe.

Others:

This reporting segment includes various information and communications technology services, materials for electronic components and optical components.

Sales in this reporting segment for the nine months decreased by 1.2% compared with the previous nine months to ¥99,875 million due mainly to a decrease in sales in the optical related business. Operating profit stood at ¥6,731 million, a great increase of 57.2% compared with the previous nine months, due to the positive effect of sales growth at Kyocera Communication Systems Co., Ltd.

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Consolidated Sales by Reporting Segment


	(Yen in millions)
	Nine months ended December 31,								Increase (Decrease) (%)
	2006				2007
	Amount		% to the net sales		Amount		% to the net sales
Fine Ceramic Parts Group	60,206		6.3		61,820		6.4		2.7
Semiconductor Parts Group	115,578		12.1		113,928		11.8		(1.4	)
Applied Ceramic Products Group	98,337		10.3		108,736		11.3		10.6
Electronic Device Group	214,338		22.4		225,557		23.3		5.2

Total Components Business	488,459		51.1		510,041		52.8		4.4
Telecommunications Equipment Group	188,576		19.7		168,596		17.4		(10.6	)
Information Equipment Group	194,894		20.4		206,555		21.4		6.0

Total Equipment Business	383,470		40.1		375,151		38.8		(2.2	)
Others	101,040		10.6		99,875		10.3		(1.2	)
Adjustments and eliminations	(17,658	)	(1.8	)	(18,849	)	(1.9	)	—

Net sales	955,311		100.0		966,218		100.0		1.1

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Consolidated Operating Profit by Reporting Segment


	(Yen in millions)
	Nine months ended December 31,						Increase (Decrease) (%)
	2006			2007
	Amount		% to segment sales	Amount		% to segment sales
Fine Ceramic Parts Group	11,680		19.4	8,990		14.5	(23.0	)
Semiconductor Parts Group	17,850		15.4	14,736		12.9	(17.4	)
Applied Ceramic Products Group	15,839		16.1	22,820		21.0	44.1
Electronic Device Group	32,996		15.4	30,459		13.5	(7.7	)

Total Components Business	78,365		16.0	77,005		15.1	(1.7	)
Telecommunications Equipment Group	575		0.3	3,129		1.9	444.2
Information Equipment Group	24,631		12.6	28,374		13.7	15.2

Total Equipment Business	25,206		6.6	31,503		8.4	25.0
Others	4,283		4.2	6,731		6.7	57.2

Operating profit	107,854		11.3	115,239		11.9	6.8
Corporate	8,617		—	10,904		—	26.5
Equity in earnings of affiliates and unconsolidated subsidiaries	151		—	5,841		—	—
Adjustments and eliminations	(417	)	—	(13	)	—	—

Income from continuing operations before income taxes	116,205		12.2	131,971		13.7	13.6

Note 1. From April 1, 2007, the “Optical Equipment Group,” previously a separate reporting segment, has been reclassified into “Others.” Accordingly, sales and operating profit for the previous nine months have been retroactively reclassified.

Note 2. For the reasons set forth in Note 1 above, net sales of “Others” in the previous nine months increased by ¥8,721 million and “Adjustments and eliminations” decreased by ¥(102) million compared with those previously announced. Also, operating profit of “Others” in the previous nine months decreased by ¥1,588 million compared with those previously announced.

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(5) Consolidated Sales by Geographic Area


	(Yen in millions)
	Nine months ended December 31,				Increase (Decrease) (%)
	2006		2007
	Amount	% to net sales	Amount	% to net sales
Japan	367,122	38.4	369,960	38.3	0.8
United States of America	203,861	21.3	189,117	19.6	(7.2	)
Asia	165,211	17.3	179,066	18.5	8.4
Europe	152,728	16.0	171,425	17.7	12.2
Others	66,389	7.0	56,650	5.9	(14.7	)

Net sales	955,311	100.0	966,218	100.0	1.1

1) Japan

Although sales in the Semiconductor Parts Group increased, sales of thin-film device products in the Electronic Device Group declined. As a result, overall sales in the domestic market slightly increased compared with the previous nine months.

2) United States of America

Sales decreased compared with the previous nine months due mainly to a decline in sales in the Telecommunications Equipment Group.

3) Asia

Although sales in the Telecommunication Equipment Group decreased, the Electronic Device Group presented growth in sales. Therefore, Sales in this region as a whole increased compared with the previous nine months.

4) Europe

Sales increased in the Information Equipment Group and the solar energy business in the Applied Ceramic Products Group as well as sales in the Electronic Device Group. Therefore, Sales in this region significantly increased compared with the previous nine months.

5) Others

Sales decreased compared with the previous nine months due to a decline in sales in the Telecommunication Equipment Group in Latin America and Oceania.

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2. Cash Flows

Cash and cash equivalent at December 31, 2007 decreased by ¥30,138 million to ¥252,070 million compared with at March 31, 2007.


	(Yen in millions)
	Nine months ended December 31,
	2006		2007
Cash flow from operating activities	70,152		110,957
Cash flow from investing activities	(100,448	)	(119,915	)
Cash flow from financing activities	(12,803	)	(20,494	)
Effect of exchange rate changes on cash and cash equivalent	4,664		(686	)
Net decrease in cash and cash equivalent	(38,435	)	(30,138	)
Cash and cash equivalent at beginning of period	300,809		282,208
Cash and cash equivalent at end of period	262,374		252,070

(1) Cash flow from operating activities

Net cash provided by operating activities in the nine months increased by ¥40,805 million to ¥110,957 million from ¥70,152 million in the previous nine months. This was due mainly to an increase in net income and a decrease in receivables that increased in the previous nine months.

(2) Cash flow from investing activities

Net cash used in investing activities in the nine months increased by ¥19,467 million to ¥119,915 million from ¥100,448 million in the previous nine months. This was due mainly to cash outflows by acquisitions of businesses.

(3) Cash flow from financing activities

Net cash used in financing activities in the nine months increased by ¥7,691 million to ¥20,494 million from ¥12,803 million in the previous nine months. This was due mainly to a decrease in short-term debt that increased in the previous nine months.

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3. Consolidated Financial Forecasts for the Year Ending March 31, 2008

Recently, fears over a deceleration in the world business environment, including individual consumption in the U.S. economy, have worsened due to the impact of issues related to housing loans for individuals with low creditworthiness and the rise in oil prices.

This has produced heightened uncertainty with respect to the market environment in the short-term. Based on projections of the market environment and on the business results of Kyocera for the nine months, the following revisions have been made to forecasts of the consolidated financial results as a whole and financial result by reporting segment for the year ending March 31, 2008 (fiscal 2008).

Kyocera will continue to enhance its business strategy to achieve sustainable sales growth and a high profit ratio. Furthermore, Kyocera aims to strengthen basis of each business segment by practicing its Amoeba Management System.


	(Yen in millions, except per share amounts and exchange rates)
	Result for fiscal 2007		Forecasts for fiscal 2008 announced on				Increase (Decrease) to the result for fiscal 2007 (%)
	Result for fiscal 2007		October 30, 2007		January 29, 2008
	Amount	% to net sales	Amount	% to net sales	Amount	% to net sales
Net sales	1,283,897	100.0	1,330,000	100.0	1,290,000	100.0	0.5
Profit from operations	135,102	10.5	151,000	11.4	140,000	10.9	3.6
Income from continuing operations before income taxes	156,540	12.2	166,000	12.5	166,000	12.9	6.0
Net income	106,504	8.3	103,000	7.7	103,000	8.0	(3.3	)
Diluted earnings per share	564.79	—	543.40	—	543.33	—	(3.8	)
Average US$ exchange rate	117	—	110	—	115	—	—
Average Euro exchange rate	150	—	150	—	161	—	—

Note 3. The average U.S. dollar and Euro exchange rates set forth above are the average of those for the nine months and the forecast from January 1, 2008 to March 31, 2008.

Note 4. Forecast of diluted earnings per share for fiscal 2008 set forth above is computed based on the diluted average number of shares outstanding during the nine months.

- 11 -


	(Yen in millions)
	Result for fiscal 2007				Forecasts for fiscal 2008 announced on								Increase (Decrease) to the result for fiscal 2007 (%)
	Result for fiscal 2007				October 30, 2007				January 29, 2008
	Amount		% to net sales		Amount		% to net sales		Amount		% to net sales
Fine Ceramic Parts Group	81,326		6.3		85,000		6.4		82,000		6.4		0.8
Semiconductor Parts Group	152,292		11.9		154,000		11.6		150,000		11.6		(1.5	)
Applied Ceramic Products Group	131,103		10.2		152,000		11.4		150,000		11.6		14.4
Electronic Device Group	286,156		22.3		304,000		22.9		295,000		22.9		3.1

Total Components Business	650,877		50.7		695,000		52.3		677,000		52.5		4.0
Telecommunications Equipment Group	251,183		19.6		228,000		17.1		224,000		17.3		(10.8	)
Information Equipment Group	268,781		20.9		284,000		21.4		276,000		21.4		2.7

Total Equipment Business	519,964		40.5		512,000		38.5		500,000		38.7		(3.8	)
Others	137,235		10.7		142,000		10.7		138,000		10.7		0.6
Adjustments and eliminations	(24,179	)	(1.9	)	(19,000	)	(1.5	)	(25,000	)	(1.9	)	—

Net sales	1,283,897		100.0		1,330,000		100.0		1,290,000		100.0		0.5

Note 5. For the reasons set forth in Note 1 on page 8, net sales of “Others” in the year ended March 31, 2007 (fiscal 2007) increased by ¥11,579 million and “Adjustments and eliminations” decreased by ¥(125) million compared with those previously announced.

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	(Yen in millions)
	Result for fiscal 2007		Forecasts for fiscal 2008 announced on				Increase (Decrease) to the result for fiscal 2007(%)
	Result for fiscal 2007		October 30, 2007		January 29, 2008
	Amount	% to segment sales	Amount	% to segment sales	Amount	% to segment sales
Fine Ceramic Parts Group	15,677	19.3	13,500	15.9	11,000	13.4	(29.8	)
Semiconductor Parts Group	22,210	14.6	21,000	13.6	19,000	12.7	(14.5	)
Applied Ceramic Products Group	22,334	17.0	29,000	19.1	28,000	18.7	25.4
Electronic Device Group	44,487	15.5	44,500	14.6	38,000	12.9	(14.6	)

Total Components Business	104,708	16.1	108,000	15.5	96,000	14.2	(8.3	)
Telecommunications Equipment Group	291	0.1	2,000	0.9	6,000	2.7	—
Information Equipment Group	33,970	12.6	39,000	13.7	37,000	13.4	8.9

Total Equipment Business	34,261	6.6	41,000	8.0	43,000	8.6	25.5
Others	6,881	5.0	6,000	4.2	9,000	6.5	30.8

Operating profit	145,850	11.4	155,000	11.7	148,000	11.5	1.5
Corporate and others	10,690	—	11,000	—	18,000	—	68.4

Income from continuing operations before income taxes	156,540	12.2	166,000	12.5	166,000	12.9	6.0

Note 6. For the reasons set forth in Note 1 on page 8, operating profit of “Others” in fiscal 2007 decreased by ¥1,895 million compared with those previously announced.

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Note 7. Forward-Looking Statements

Certain of the statements made in this document are forward-looking statements (within the meaning of Section 21E of the U.S. Securities and Exchange Act of 1934), which are based on our current assumptions and beliefs in light of the information currently available to us. These forward-looking statements involve known and unknown risks, uncertainties and other factors. Such risks, uncertainties and other factors include, but are not limited to: general economic conditions in our markets, which are primarily Japan, North America, Europe, and Asia, particularly including China; unexpected changes in economic, political and legal conditions in China; our ability to develop, launch and produce innovative products, including meeting quality and delivery standards, and our ability to otherwise meet the advancing technical requirements of our customers, particularly in the highly competitive markets for ceramics, semiconductor parts and electronic components; manufacturing delays or defects resulting from outsourcing or internal manufacturing processes which may adversely affect our production yields and operating results; factors that may affect our exports, including a strong yen, political and economic instability, difficulties in collection of accounts receivable, decrease in cost competitiveness of our products, increases in shipping and handling costs, difficulty in staffing and managing international operations, and inadequate protection of our intellectual property; changes in exchange rates, particularly between the yen and the U.S. dollar and Euro, respectively, in which we make significant sales; inability to secure skilled employees, particularly engineering and technical personnel; insufficient protection of our trade secrets and patents; holding licenses to continue to manufacture and sell certain of its products, the expense of which may adversely affects its results of operations; future initiatives and in-process research and development may not produce the desired results; events that may impact negatively on our markets or supply chain, including terrorist acts and outbreaks of diseases; the occurrence of natural disasters, such as earthquakes, in locations where our manufacturing and other key business facilities are located; and fluctuations in the value of, and impairment losses on, securities and other assets held by us, and changes in accounting principles. Such risks, uncertainties and other factors may cause our 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. We undertake no obligation to publicly update any forward-looking statements included in this document.

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CONSOLIDATED BALANCE SHEETS


	Yen in millions
					(Unaudited)
	March 31, 2007				December 31, 2007				Increase
	Amount			%	Amount			%	(Decrease)
Current assets :
Cash and cash equivalents	¥	282,208			¥	252,070			¥	(30,138	)
Short-term investments		213,495				290,505				77,010
Trade notes receivable		25,033				21,815				(3,218	)
Trade accounts receivable		236,380				235,386				(994	)
Less allowances for doubtful accounts and sales returns		(5,960	)			(5,354	)			606
Inventories		209,188				213,702				4,514
Deferred income taxes		45,390				39,238				(6,152	)
Other current assets		40,757				56,255				15,498

Total current assets		1,046,491		49.1		1,103,617		52.2		57,126

Non-current assets :
Investments and advances:
Investments in and advances to affiliates and unconsolidated subsidiaries		10,093				16,778				6,685
Securities and other investments		690,568				585,855				(104,713	)

Total investments and advances		700,661		32.9		602,633		28.5		(98,028	)

Property, plant and equipment, at cost :
Land		56,806				57,498				692
Buildings		261,998				272,608				10,610
Machinery and equipment		729,636				755,340				25,704
Construction in progress		7,362				14,787				7,425
Less accumulated depreciation		(774,896	)			(815,727	)			(40,831	)

Total property, plant and equipment, at cost		280,906		13.2		284,506		13.4		3,600

Goodwill		32,894		1.5		41,941		2.0		9,047
Intangible assets		24,657		1.2		33,492		1.6		8,835
Other assets		44,855		2.1		48,875		2.3		4,020

Total non-current assets		1,083,973		50.9		1,011,447		47.8		(72,526	)

Total assets	¥	2,130,464		100.0	¥	2,115,064		100.0	¥	(15,400	)

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	Yen in millions
	March 31, 2007				(Unaudited) December 31, 2007				Increase
	Amount			%	Amount			%	(Decrease)
Current liabilities :
Short-term borrowings	¥	15,250			¥	13,653			¥	(1,597	)
Current portion of long-term debt		5,853				4,628				(1,225	)
Trade notes and accounts payable		100,295				97,007				(3,288	)
Other notes and accounts payable		49,134				54,771				5,637
Accrued payroll and bonus		41,680				33,012				(8,668	)
Accrued income taxes		36,475				16,145				(20,330	)
Other accrued liabilities		33,391				35,278				1,887
Other current liabilities		24,110				31,193				7,083

Total current liabilities		306,188		14.4		285,687		13.5		(20,501	)

Non-current liabilities :
Long-term debt		7,283				9,074				1,791
Accrued pension and severance liabilities		16,297				16,075				(222	)
Deferred income taxes		206,858				175,470				(31,388	)
Other non-current liabilities		12,355				13,312				957

Total non-current liabilities		242,793		11.4		213,931		10.1		(28,862	)

Total liabilities		548,981		25.8		499,618		23.6		(49,363	)

Minority interests in subsidiaries		66,923		3.1		70,056		3.3		3,133

Stockholders’ equity :
Common stock		115,703				115,703				—
Additional paid-in capital		162,363				162,802				439
Retained earnings		1,055,293				1,120,093				64,800
Accumulated other comprehensive income		203,056				162,120				(40,936	)
Treasury stock, at cost		(21,855	)			(15,328	)			6,527

Total stockholders’ equity		1,514,560		71.1		1,545,390		73.1		30,830

Total liabilities, minority interests and stockholders’ equity	¥	2,130,464		100.0	¥	2,115,064		100.0	¥	(15,400	)

Note: Accumulated other comprehensive income is as follows.


	Yen in millions
	March 31, 2007		December 31, 2007
Net unrealized gains on securities	¥	184,670	¥	144,562
Net unrealized gains (losses) on derivative financial instruments	¥	63	¥	(146	)
Pension adjustments	¥	15,419	¥	14,278
Foreign currency translation adjustments	¥	2,904	¥	3,426

- 16 -

CONSOLIDATED STATEMENTS OF INCOME (Unaudited)


	Yen in millions and shares in thousands, except per share amounts
	Nine months ended December 31,										Increase
	2006					2007					(Decrease)
	Amount			%		Amount			%		Amount			%
Net sales	¥	955,311		100.0		¥	966,218		100.0		¥	10,907		1.1
Cost of sales		669,277		70.1			665,128		68.8			(4,149	)	(0.6	)

Gross profit		286,034		29.9			301,090		31.2			15,056		5.3
Selling, general and administrative expenses		184,662		19.3			190,959		19.8			6,297		3.4

Profit from operations		101,372		10.6			110,131		11.4			8,759		8.6
Other income (expenses) :
Interest and dividend income		12,086		1.3			15,728		1.6			3,642		30.1
Interest expense		(1,096	)	(0.1	)		(1,212	)	(0.0	)		(116	)	—
Foreign currency transaction gains, net		533		0.1			273		0.0			(260	)	(48.8	)
Equity in earnings of affiliates and unconsolidated subsidiaries		151		0.0			5,841		0.6			5,690		—
Gains on sale of securities, net		3,216		0.3			156		0.0			(3,060	)	(95.1	)
Other, net		(57	)	(0.0	)		1,054		0.1			1,111		—

Total other income		14,833		1.6			21,840		2.3			7,007		47.2

Income from continuing operations before income taxes and minority interests		116,205		12.2			131,971		13.7			15,766		13.6
Income taxes		37,619		4.0			43,112		4.5			5,493		14.6

Income from continuing operations before minority interests		78,586		8.2			88,859		9.2			10,273		13.1
Minority interests		(4,443	)	(0.4	)		(5,343	)	(0.6	)		(900	)	—

Income from continuing operations		74,143		7.8			83,516		8.6			9,373		12.6
Income from discontinued operations		5,175		0.5			—		—			(5,175	)	—

Net income	¥	79,318		8.3		¥	83,516		8.6		¥	4,198		5.3


Earnings per share:
Income from continuing operations:
Basic	¥	394.32				¥	441.36
Diluted	¥	393.50				¥	440.56

Income from discontinued operations:
Basic	¥	27.53					—
Diluted	¥	27.47					—

Net income:
Basic	¥	421.85				¥	441.36
Diluted	¥	420.97				¥	440.56

Weighted average number of shares of common stock outstanding :
Basic		188,027					189,226
Diluted		188,417					189,570

- 17 -

Notes :

Kyocera applies the Statement of Financial Accounting Standards Board (SFAS) No.130, “Financial Reporting of Comprehensive Income.” Based on this standard, comprehensive income for the nine months ended December 31, 2006 and 2007 were an increase of ¥147,201 million and an increase of ¥42,580 million, respectively.

Earnings per share amounts were computed based on SFAS No.128, “Earnings per Share.” Under SFAS No.128, basic earnings per share was computed based on the weighted average number of shares of common stock outstanding during each period and diluted earnings per share assumed the dilution that could occur if securities or other contracts to issue common stock were converted into common stock, exercised or resulted in the issuance of common stock.

Against the Correction Disposition with regard to transfer pricing taxation, which was rendered by the Osaka Regional Taxation Bureau in March 2005, Kyocera filed the Request for Reinvestigation in May 2005. Kyocera then received the Decision on the Request for Reinvestigation in September 2006. Based on the Decision, ¥(4,305) million is included in income taxes shown above, as refunds for the previous years.

Kyocera sold its entire shares in Kyocera Leasing Co., Ltd., a subsidiary engaged in financial services; as a result, business results and profit on sales, ¥5,175 million, for Kyocera Leasing Co., Ltd. for the nine months ended December 31, 2006 have been recorded as income from discontinued operations in conformity with SFAS No.144, “Accounting for the impairment or disposal of Long-Lived Assets.”

- 18 -

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY


	Yen in millions and shares in thousands
(Number of shares of common stock)	Common stock		Additional paid-in capital		Retained earnings			Accumulated other comprehensive income			Treasury stock			Comprehensive income
Balance, March 31, 2006 (187,755)	¥	115,703	¥	161,994	¥	967,576		¥	72,947		¥	(29,143	)
Net income for the year						106,504								¥	106,504
Other comprehensive income									112,551						112,551

Total comprehensive income for the year														¥	219,055

Adjustment for initially applying SAFS No. 158, net of taxes									17,558
Cash dividends						(18,787	)
Purchase of treasury stock (24)												(251	)
Reissuance of treasury stock (918)				127								7,539
Stock option plan of subsidiaries				242

Balance, March 31, 2007 (188,649)		115,703		162,363		1,055,293			203,056			(21,855	)
(Unaudited)
Cumulative effect of applying FIN 48 to opening balance (Note)						3,968
Net income for the period						83,516								¥	83,516
Other comprehensive income									(40,936	)					(40,936	)

Total comprehensive income for the period														¥	42,580

Cash dividends						(22,684	)
Purchase of treasury stock (16)												(193	)
Reissuance of treasury stock (816)				252								6,720
Stock option plan of subsidiaries				187

Balance, December 31, 2007 (189,449)	¥	115,703	¥	162,802	¥	1,120,093		¥	162,120		¥	(15,328	)

- 19 -


	Yen in millions and shares in thousands
(Number of shares of common stock)	Common stock		Additional paid-in capital		Retained earnings			Accumulated other comprehensive income		Treasury stock			Comprehensive income
Balance, March 31, 2006 (187,755)	¥	115,703	¥	161,994	¥	967,576		¥	72,947	¥	(29,143	)
(Unaudited)
Net income for the period						79,318							¥	79,318
Other comprehensive income									67,883					67,883

Total comprehensive income for the period													¥	147,201

Cash dividends						(18,787	)
Purchase of treasury stock (18)											(183	)
Reissuance of treasury stock (568)				48							4,660
Stock option plan of subsidiaries				179

Balance, December 31, 2006 (188,305)	¥	115,703	¥	162,221	¥	1,028,107		¥	140,830	¥	(24,666	)

Note :

In June 2006, the Financial Accounting Standard Board (FASB) issued Interpretation No. 48, “Accounting for Uncertainty in Income Taxes-an interpretation of FASB Statement No.109” (FIN 48) which clarifies the accounting for uncertainty in income taxes recognized in the financial statements in accordance with SFAS No. 109, “Accounting for Income Taxes.” FIN 48 also provides guidance on derecognition, classification, interest and penalties, disclosure and transitional measures. Cumulative effect of applying FIN 48, which was effective April 1, 2007, increased the opening balance of retained earnings by ¥3,968 million.

- 20 -

CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)


	Yen in millions
	Nine months ended December 31,
	2006			2007
	Amount			Amount
Cash flows from operating activities :
Net income	¥	79,318		¥	83,516
Adjustments to reconcile net income to net cash provided by operating activities :
Depreciation and amortization		58,770			64,351
Write-down of inventories		4,213			3,630
Equity in earnings of affiliates and unconsolidated subsidiaries		(151	)		(5,841	)
Gains on sales of securities, net		(3,216	)		(156	)
Minority interests		4,443			5,343
Gains on sales of investment in subsidiaries		(8,228	)		—
(Increase) decrease in receivables		(40,339	)		4,514
Increase in inventories		(26,098	)		(2,945	)
Increase (decrease) in notes and accounts payable		8,191			(11,841	)
Decrease in accrued income taxes		(1,220	)		(20,111	)
Increase (decrease) in other current liabilities		11,107			(141	)
Other, net		(16,638	)		(9,362	)

Net cash provided by operating activities		70,152			110,957

Cash flows from investing activities :
Payments for purchases of securities		(43,820	)		(25,740	)
Sales and maturities of securities		100,585			113,019
Acquisitions of business, net of cash acquired		(756	)		(26,801	)
Proceeds from sales of investment in subsidiaries		24,553			—
Payments for purchases of property, plant and equipment, and intangible assets		(56,541	)		(50,762	)
Proceeds from sales of property, plant and equipment, and intangible assets		2,686			711
Deposit of negotiable certificate of deposits and time deposits		(271,240	)		(343,950	)
Withdrawal of negotiable certificate of deposits and time deposits		144,151			227,134
Other, net		(66	)		(13,526	)

Net cash used in investing activities		(100,448	)		(119,915	)

Cash flows from financing activities :
Increase (decrease) in short-term debt		15,635			(2,049	)
Proceeds from issuance of long-term debt		1,928			5,000
Payments of long-term debt		(11,004	)		(5,268	)
Dividends paid		(20,148	)		(23,934	)
Purchase of treasury stock		(183	)		(193	)
Reissuance of treasury stock		4,708			6,972
Other, net		(3,739	)		(1,022	)

Net cash used in financing activities		(12,803	)		(20,494	)

Effect of exchange rate changes on cash and cash equivalents		4,664			(686	)

Net decrease in cash and cash equivalents		(38,435	)		(30,138	)
Cash and cash equivalents at beginning of period		300,809			282,208

Cash and cash equivalents at end of period	¥	262,374		¥	252,070

- 21 -

SEGMENT INFORMATION (Unaudited)

1. Reporting segments :


	Yen in millions
	Nine months ended December 31,						Increase (Decrease)
	2006			2007			Increase (Decrease)
	Amount			Amount			Amount			%
Net sales :
Fine Ceramic Parts Group	¥	60,206		¥	61,820		¥	1,614		2.7
Semiconductor Parts Group		115,578			113,928			(1,650	)	(1.4	)
Applied Ceramic Products Group		98,337			108,736			10,399		10.6
Electronic Device Group		214,338			225,557			11,219		5.2
Telecommunications Equipment Group		188,576			168,596			(19,980	)	(10.6	)
Information Equipment Group		194,894			206,555			11,661		6.0
Others		101,040			99,875			(1,165	)	(1.2	)
Adjustments and eliminations		(17,658	)		(18,849	)		(1,191	)	—

	¥	955,311		¥	966,218		¥	10,907		1.1

Operating profit :
Fine Ceramic Parts Group	¥	11,680		¥	8,990		¥	(2,690	)	(23.0	)
Semiconductor Parts Group		17,850			14,736			(3,114	)	(17.4	)
Applied Ceramic Products Group		15,839			22,820			6,981		44.1
Electronic Device Group		32,996			30,459			(2,537	)	(7.7	)
Telecommunications Equipment Group		575			3,129			2,554		444.2
Information Equipment Group		24,631			28,374			3,743		15.2
Others		4,283			6,731			2,448		57.2

		107,854			115,239			7,385		6.8

Corporate		8,617			10,904			2,287		26.5
Equity in earnings of affiliates and unconsolidated subsidiaries		151			5,841			5,690		—
Adjustments and eliminations		(417	)		(13	)		404		—

Income from continuing operations before income taxes and minority interests	¥	116,205		¥	131,971		¥	15,766		13.6

Depreciation and amortization :
Fine Ceramic Parts Group	¥	3,145		¥	5,437		¥	2,292		72.9
Semiconductor Parts Group		9,196			11,006			1,810		19.7
Applied Ceramic Products Group		5,867			7,107			1,240		21.1
Electronic Device Group		15,347			17,884			2,537		16.5
Telecommunications Equipment Group		5,042			6,577			1,535		30.4
Information Equipment Group		12,079			8,832			(3,247	)	(26.9	)
Others		6,047			5,276			(771	)	(12.8	)
Corporate		1,927			2,232			305		15.8

Total	¥	58,650		¥	64,351		¥	5,701		9.7

Capital expenditures :
Fine Ceramic Parts Group	¥	5,533		¥	7,082		¥	1,549		28.0
Semiconductor Parts Group		9,150			6,533			(2,617	)	(28.6	)
Applied Ceramic Products Group		4,964			6,088			1,124		22.6
Electronic Device Group		15,679			16,063			384		2.4
Telecommunications Equipment Group		2,869			1,717			(1,152	)	(40.2	)
Information Equipment Group		9,624			9,881			257		2.7
Others		4,983			2,594			(2,389	)	(47.9	)
Corporate		1,701			3,732			2,031		119.4

Total	¥	54,503		¥	53,690		¥	(813	)	(1.5	)

- 22 -

2. Geographic segments (Sales and Operating profits by geographic area) :


	Yen in millions
	Nine months ended December 31,						Increase (Decrease)
	2006			2007			Increase (Decrease)
	Amount			Amount			Amount			%
Net sales:
Japan	¥	388,517		¥	390,591		¥	2,074		0.5
Intra-group sales and transfer between geographic areas		300,626			291,348			(9,278	)	(3.1	)

		689,143			681,939			(7,204	)	(1.0	)

United States of America		240,578			218,188			(22,390	)	(9.3	)
Intra-group sales and transfer between geographic areas		26,607			23,523			(3,084	)	(11.6	)

		267,185			241,711			(25,474	)	(9.5	)

Asia		146,482			158,691			12,209		8.3
Intra-group sales and transfer between geographic areas		118,295			134,676			16,381		13.8

		264,777			293,367			28,590		10.8

Europe		160,040			179,859			19,819		12.4
Intra-group sales and transfer between geographic areas		30,597			30,661			64		0.2

		190,637			210,520			19,883		10.4

Others		19,694			18,889			(805	)	(4.1	)
Intra-group sales and transfer between geographic areas		8,395			11,794			3,399		40.5

		28,089			30,683			2,594		9.2

Adjustments and eliminations		(484,520	)		(492,002	)		(7,482	)	—

	¥	955,311		¥	966,218		¥	10,907		1.1

Operating Profits :
Japan	¥	77,393		¥	74,182		¥	(3,211	)	(4.1	)
United States of America		16,329			8,595			(7,734	)	(47.4	)
Asia		16,667			19,328			2,661		16.0
Europe		6,628			7,374			746		11.3
Others		670			2,594			1,924		287.2

		117,687			112,073			(5,614	)	(4.8	)
Adjustments and eliminations		(10,250	)		3,153			13,403		—

		107,437			115,226			7,789		7.2

Corporate		8,617			10,904			2,287		26.5
Equity in earnings of affiliates and unconsolidated subsidiaries		151			5,841			5,690		—

Income from continuing operations before income taxes and minority interests	¥	116,205		¥	131,971		¥	15,766		13.6

- 23 -

3. Geographic segments (Sales by region) :


	Yen in millions
	Nine months ended December 31,								Increase (Decrease)
	2006				2007				Increase (Decrease)
	Amount			%	Amount			%	Amount			%
Japan	¥	367,122		38.4	¥	369,960		38.3	¥	2,838		0.8
United States of America		203,861		21.3		189,117		19.6		(14,744	)	(7.2	)
Asia		165,211		17.3		179,066		18.5		13,855		8.4
Europe		152,728		16.0		171,425		17.7		18,697		12.2
Others		66,389		7.0		56,650		5.9		(9,739	)	(14.7	)

Net sales	¥	955,311		100.0	¥	966,218		100.0	¥	10,907		1.1

Sales outside Japan	¥	588,189			¥	596,258			¥	8,069		1.4
Sales outside Japan to net sales		61.6	%			61.7	%

- 24 -

Appendix

Consolidated Orders and Production by Reporting Segment

Consolidated Orders by Reporting Segment


	(Yen in millions)
	Nine months ended December 31,								Increase (Decrease) (%)
	2006				2007
	Amount		% to the total		Amount		% to the total
Fine Ceramic Parts Group	60,582		6.3		62,834		6.5		3.7
Semiconductor Parts Group	113,273		11.8		115,299		11.9		1.8
Applied Ceramic Products Group	100,821		10.5		114,007		11.7		13.1
Electronic Device Group	224,943		23.4		230,277		23.7		2.4

Total Components Business	499,619		52.0		522,417		53.8		4.6
Telecommunications Equipment Group	184,068		19.2		159,474		16.4		(13.4	)
Information Equipment Group	194,444		20.2		206,937		21.3		6.4

Total Equipment Business	378,512		39.4		366,411		37.7		(3.2	)
Others	100,607		10.4		100,648		10.4		0.0
Adjustments and eliminations	(17,244	)	(1.8	)	(18,043	)	(1.9	)	—

Orders	961,494		100.0		971,433		100.0		1.0

Note 1. From April 1, 2007, the “Optical Equipment Group,” previously a separate reporting segment, has been reclassified into “Others.” Accordingly, orders for the previous nine months have been retroactively reclassified.

Note 2. For the reasons Note 1 above, orders of “Others” in the previous nine months increased by ¥8,866 million and “Adjustments and eliminations” increased by ¥(1) million compared with those previously announced.

- 25 -

Consolidated Production by Reporting Segment


	(Yen in millions)
	Nine months ended December 31,				Increase (Decrease) (%)
	2006		2007
	Amount	% to the total	Amount	% to the total
Fine Ceramic Parts Group	61,401	6.3	62,358	6.5	1.6
Semiconductor Parts Group	115,314	11.8	116,173	12.1	0.7
Applied Ceramic Products Group	100,970	10.4	114,945	12.0	13.8
Electronic Device Group	218,458	22.5	221,150	23.1	1.2

Total Components Business	496,143	51.0	514,626	53.7	3.7
Telecommunications Equipment Group	192,455	19.8	165,281	17.2	(14.1	)
Information Equipment Group	209,713	21.6	203,720	21.2	(2.9	)

Total Equipment Business	402,168	41.4	369,001	38.4	(8.2	)
Others	74,260	7.6	75,882	7.9	2.2

Production	972,571	100.0	959,509	100.0	(1.3	)

Note 3. For the reasons set forth Note 1 on the previous page, production of “Others” in the previous nine months increased by ¥8,809 million compared with those previously announced.

- 26 -

January 29, 2008

KYOCERA CORPORATION

Consolidated Financial Highlights

Results for the Nine Months Ended December 31, 2007


	(Yen in millions, except for per share amounts, exchange rates and the number of employees)
	Nine Months Ended December 31,		Increase (Decrease) (%)
	2006	2007	Increase (Decrease) (%)
Net sales	955,311	966,218	1.1
Profit from operations	101,372	110,131	8.6
Income from continuing operations before income taxes	116,205	131,971	13.6
Net income	79,318	83,516	5.3
Average exchange rates :
US$	116	117	—
Euro	148	163	—
Earnings per share :
Net income
Basic	421.85	441.36	4.6
Diluted	420.97	440.56	4.7
Capital expenditures	54,503	53,690	(1.5	)
Depreciation	51,129	55,777	9.1
R&D expenses	45,498	46,623	2.5
Total assets	2,010,730	2,115,064	—
Stockholders’ equity	1,422,195	1,545,390	—
Sales of products manufactured outside Japan to net sales (%)	34.6	34.1	—
The number of employees	63,219	67,224	—

- 27 -

CONSOLIDATED BALANCE SHEETS (Unaudited)


	Yen in millions
	September 30, 2007				December 31, 2007				Increase (Decrease)
	Amount			%	Amount			%	Increase (Decrease)
Current assets :
Cash and cash equivalents	¥	274,508			¥	252,070			¥	(22,438	)
Short-term investments		287,650				290,505				2,855
Trade notes receivable		21,567				21,815				248
Trade accounts receivable		232,381				235,386				3,005
Less allowances for doubtful accounts and sales returns		(5,914	)			(5,354	)			560
Inventories		208,933				213,702				4,769
Deferred income taxes		41,141				39,238				(1,903	)
Other current assets		51,940				56,255				4,315

Total current assets		1,112,206		52.8		1,103,617		52.2		(8,589	)

Non-current assets :
Investments and advances :
Investments in and advances to affiliates and unconsolidated subsidiaries		14,606				16,778				2,172
Securities and other investments		579,062				585,855				6,793

Total investments and advances		593,668		28.2		602,633		28.5		8,965

Property, plant and equipment, at cost :
Land		57,154				57,498				344
Buildings		264,325				272,608				8,283
Machinery and equipment		746,552				755,340				8,788
Construction in progress		12,800				14,787				1,987
Less accumulated depreciation		(800,535	)			(815,727	)			(15,192	)

Total property, plant and equipment, at cost		280,296		13.3		284,506		13.4		4,210

Goodwill		42,022		2.0		41,941		2.0		(81	)
Intangible assets		33,633		1.6		33,492		1.6		(141	)
Other assets		45,272		2.1		48,875		2.3		3,603

Total non-current assets		994,891		47.2		1,011,447		47.8		16,556

Total assets	¥	2,107,097		100.0	¥	2,115,064		100.0	¥	7,967

- 28 -


	Yen in millions
	September 30, 2007				December 31, 2007				Increase (Decrease)
	Amount			%	Amount			%	Increase (Decrease)
Current liabilities :
Short-term borrowings	¥	17,351			¥	13,653			¥	(3,698	)
Current portion of long-term debt		3,268				4,628				1,360
Trade notes and accounts payable		94,232				97,007				2,775
Other notes and accounts payable		49,025				54,771				5,746
Accrued payroll and bonus		42,774				33,012				(9,762	)
Accrued income taxes		24,822				16,145				(8,677	)
Other accrued liabilities		34,405				35,278				873
Other current liabilities		24,629				31,193				6,564

Total current liabilities		290,506		13.8		285,687		13.5		(4,819	)

Non-current liabilities :
Long-term debt		6,269				9,074				2,805
Accrued pension and severance liabilities		16,115				16,075				(40	)
Deferred income taxes		181,108				175,470				(5,638	)
Other non-current liabilities		13,461				13,312				(149	)

Total non-current liabilities		216,953		10.3		213,931		10.1		(3,022	)

Total liabilities		507,459		24.1		499,618		23.6		(7,841	)

Minority interests in subsidiaries		69,554		3.3		70,056		3.3		502

Stockholders’ equity :
Common stock		115,703				115,703				—
Additional paid-in capital		162,735				162,802				67
Retained earnings		1,098,562				1,120,093				21,531
Accumulated other comprehensive income		168,652				162,120				(6,532	)
Treasury stock, at cost		(15,568	)			(15,328	)			240

Total stockholders’ equity		1,530,084		72.6		1,545,390		73.1		15,306

Total liabilities, minority interests and stockholders’ equity	¥	2,107,097		100.0	¥	2,115,064		100.0	¥	7,967

Note : Accumulated other comprehensive income is as follows.


	Yen in millions
	September 30, 2007		December 31, 2007
Net unrealized gains on securities	¥	153,081	¥	144,562
Net unrealized gains (losses) on derivative financial instruments	¥	68	¥	(146	)
Pension adjustments	¥	14,664	¥	14,278
Foreign currency translation adjustments	¥	839	¥	3,426

- 29 -

CONSOLIDATED STATEMENTS OF INCOME (Unaudited)


	Yen in millions and shares in thousands, except per share amounts
	Three months ended December 31,										Increase (Decrease)
	2006					2007					Increase (Decrease)
	Amount			%		Amount			%		Amount			%
Net sales	¥	339,921		100.0		¥	329,658		100.0		¥	(10,263	)	(3.0	)
Cost of sales		239,596		70.5			223,801		67.9			(15,795	)	(6.6	)

Gross profit		100,325		29.5			105,857		32.1			5,532		5.5
Selling, general and administrative expenses		62,081		18.2			63,549		19.3			1,468		2.4

Profit from operations		38,244		11.3			42,308		12.8			4,064		10.6
Other income (expenses) :
Interest and dividend income		5,296		1.6			5,986		1.8			690		13.0
Interest expense		(314	)	(0.1	)		(353	)	(0.1	)		(39	)	—
Foreign currency transaction gains (losses), net		260		0.0			(139	)	(0.1	)		(399	)	—
Equity in (losses) earnings of affiliates and unconsolidated subsidiaries		(108	)	(0.0	)		2,224		0.7			2,332		—
Losses on sale of securities, net		(36	)	(0.0	)		(72	)	(0.0	)		(36	)	—
Other, net		478		0.1			537		0.2			59		12.3

Total other income		5,576		1.6			8,183		2.5			2,607		46.8

Income from continuing operations before income taxes and minority interests		43,820		12.9			50,491		15.3			6,671		15.2
Income taxes		16,665		4.9			15,948		4.8			(717	)	(4.3	)

Income from continuing operations before minority interests		27,155		8.0			34,543		10.5			7,388		27.2
Minority interests		(1,330	)	(0.4	)		(1,647	)	(0.5	)		(317	)	—

Income from continuing operations		25,825		7.6			32,896		10.0			7,071		27.4
Income from discontinued operations		—		—			—		—			—		—

Net income	¥	25,825		7.6		¥	32,896		10.0		¥	7,071		27.4


Earnings per share:
Income from continuing operations:
Basic	¥	137.21				¥	173.65
Diluted	¥	136.84				¥	173.49

Income from discontinued operations:
Basic		—					—
Diluted		—					—

Net income:
Basic	¥	137.21				¥	173.65
Diluted	¥	136.84				¥	173.49

Weighted average number of shares of common stock outstanding:
Basic		188,215					189,440
Diluted		188,720					189,613

- 30 -

Notes:

1.	Kyocera applies SFAS No.130, “Financial Reporting of Comprehensive Income.” Based on this standard, comprehensive income for the three months ended December 31, 2006 and 2007 were an increase of ¥55,444 million and an increase of ¥26,364 million, respectively.

Earnings per share amounts were computed based on SFAS No.128, “Earnings per Share.” Under SFAS No.128, basic earnings per share was computed based on the average number of shares of common stock outstanding during each period and diluted earnings per share assumed the dilution that could occur if securities or other contracts to issue common stock were converted into common stock, exercised or resulted in the issuance of common stock.

- 31 -

CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)


	Yen in millions
	Three months ended December 31,
	2006			2007
	Amount			Amount
Cash flows from operating activities :
Net income	¥	25,825		¥	32,896
Adjustments to reconcile net income to net cash provided by operating activities :
Depreciation and amortization		19,934			21,415
Write-down of inventories		384			587
Equity in (losses) earnings of affiliates and unconsolidated subsidiaries		108			(2,224	)
Losses on sales of securities, net		36			72
Minority interests		1,330			1,647
Increase in receivables		(8,744	)		(5,674	)
(Increase) decrease in inventories		5,076			(4,130	)
Increase (decrease) in notes and accounts payable		(10,724	)		1,840
Decrease in accrued income taxes		(5,209	)		(8,725	)
Increase (decrease) in other current liabilities		186			(2,744	)
Other, net		(5,973	)		(3,601	)

Net cash provided by operating activities		22,229			31,359

Cash flows from investing activities :
Payments for purchases of securities		(12,299	)		(9,546	)
Sales and maturities of securities		69,873			15,520
Acquisition of business, net of cash acquired		—			(30	)
Payments for purchases of property, plant and equipment, and intangible assets		(21,032	)		(18,242	)
Proceeds from sales of property, plant and equipment, and intangible assets		1,901			249
Deposit of negotiable certificate of deposits and time deposits		(123,783	)		(137,078	)
Withdrawal of negotiable certificate of deposits and time deposits		59,070			117,850
Other, net		(94	)		(11,438	)

Net cash used in investing activities		(26,364	)		(42,715	)

Cash flows from financing activities :
Increase (decrease) in short-term debt		8,319			(4,032	)
Proceeds from issuance of long-term debt		—			4,999
Payments of long-term debt		(291	)		(969	)
Dividends paid		(9,763	)		(11,874	)
Purchase of treasury stock		(79	)		(37	)
Reissuance of treasury stock		2,593			284
Other, net		(503	)		(384	)

Net cash provided by (used in) financing activities		276			(12,013	)

Effect of exchange rate changes on cash and cash equivalents		2,482			931

Net decrease in cash and cash equivalents		(1,377	)		(22,438	)
Cash and cash equivalents at beginning of period		263,751			274,508

Cash and cash equivalents at end of period	¥	262,374		¥	252,070

- 32 -

SEGMENT INFORMATION (Unaudited)

1. Reporting segments :


	Yen in millions
	Three months ended December 31,						Increase (Decrease)
	2006			2007			Increase (Decrease)
	Amount			Amount			Amount			%
Net sales :
Fine Ceramic Parts Group	¥	21,642		¥	20,534		¥	(1,108	)	(5.1	)
Semiconductor Parts Group		39,735			40,383			648		1.6
Applied Ceramic Products Group		34,205			38,993			4,788		14.0
Electronic Device Group		74,354			76,995			2,641		3.6
Telecommunications Equipment Group		71,395			54,689			(16,706	)	(23.4	)
Information Equipment Group		70,275			69,646			(629	)	(0.9	)
Others		34,380			34,598			218		0.6
Adjustments and eliminations		(6,065	)		(6,180	)		(115	)	—

	¥	339,921		¥	329,658		¥	(10,263	)	(3.0	)

Operating profit :
Fine Ceramic Parts Group	¥	4,307		¥	2,795		¥	(1,512	)	(35.1	)
Semiconductor Parts Group		5,963			6,369			406		6.8
Applied Ceramic Products Group		6,873			9,386			2,513		36.6
Electronic Device Group		11,423			9,514			(1,909	)	(16.7	)
Telecommunications Equipment Group		1,591			3,232			1,641		103.1
Information Equipment Group		9,140			9,155			15		0.2
Others		1,434			2,767			1,333		93.0

		40,731			43,218			2,487		6.1
Corporate		3,465			5,011			1,546		44.6
Equity in (losses) earnings of affiliates and unconsolidated subsidiaries		(108	)		2,224			2,332		—
Adjustments and eliminations		(268	)		38			306		—

Income from continuing operations before income taxes and minority interests	¥	43,820		¥	50,491		¥	6,671		15.2

Depreciation and amortization :
Fine Ceramic Parts Group	¥	1,202		¥	1,810		¥	608		50.6
Semiconductor Parts Group		3,343			3,506			163		4.9
Applied Ceramic Products Group		2,076			2,577			501		24.1
Electronic Device Group		5,749			6,276			527		9.2
Telecommunications Equipment Group		1,841			2,145			304		16.5
Information Equipment Group		3,840			3,081			(759	)	(19.8	)
Others		1,463			1,748			285		19.5
Corporate		420			272			(148	)	(35.2	)

Total	¥	19,934		¥	21,415		¥	1,481		7.4

Capital expenditures :
Fine Ceramic Parts Group	¥	2,633		¥	3,982		¥	1,349		51.2
Semiconductor Parts Group		3,429			2,555			(874	)	(25.5	)
Applied Ceramic Products Group		2,454			2,434			(20	)	(0.8	)
Electronic Device Group		4,786			4,817			31		0.6
Telecommunications Equipment Group		1,124			625			(499	)	(44.4	)
Information Equipment Group		1,563			4,414			2,851		182.4
Others		654			1,045			391		59.8
Corporate		621			1,226			605		97.4

Total	¥	17,264		¥	21,098		¥	3,834		22.2

- 33 -

2. Geographic segments (Sales and Operating profits by geographic area) :


	Yen in millions
	Three months ended December 31,						Increase (Decrease)
	2006			2007			Increase (Decrease)
	Amount			Amount			Amount			%
Net sales:
Japan	¥	137,555		¥	134,806		¥	(2,749	)	(2.0	)
Intra-group sales and transfer between geographic areas		101,241			96,897			(4,344	)	(4.3	)

		238,796			231,703			(7,093	)	(3.0	)

United States of America		85,223			72,057			(13,166	)	(15.4	)
Intra-group sales and transfer between geographic areas		8,824			7,651			(1,173	)	(13.3	)

		94,047			79,708			(14,339	)	(15.2	)

Asia		51,217			54,511			3,294		6.4
Intra-group sales and transfer between geographic areas		39,790			44,510			4,720		11.9

		91,007			99,021			8,014		8.8

Europe		58,546			61,847			3,301		5.6
Intra-group sales and transfer between geographic areas		10,813			9,714			(1,099	)	(10.2	)

		69,359			71,561			2,202		3.2

Others		7,380			6,437			(943	)	(12.8	)
Intra-group sales and transfer between geographic areas		2,861			3,744			883		30.9

		10,241			10,181			(60	)	(0.6	)

Adjustments and eliminations		(163,529	)		(162,516	)		1,013		—

	¥	339,921		¥	329,658		¥	(10,263	)	(3.0	)

Operating Profits :
Japan	¥	27,620		¥	27,689		¥	69		0.2
United States of America		6,382			4,451			(1,931	)	(30.3	)
Asia		5,599			6,378			779		13.9
Europe		2,803			1,809			(994	)	(35.5	)
Others		(182	)		817			999		—

		42,222			41,144			(1,078	)	(2.6	)
Adjustments and eliminations		(1,759	)		2,112			3,871		—

		40,463			43,256			2,793		6.9

Corporate		3,465			5,011			1,546		44.6
Equity in (losses) earnings of affiliates and unconsolidated subsidiaries		(108	)		2,224			2,332		—

Income from continuing operations before income taxes and minority interests	¥	43,820		¥	50,491		¥	6,671		15.2

- 34 -

3. Geographic segments (Sales by region) :


	Yen in millions
	Three months ended December 31,								Increase (Decrease)
	2006				2007				Increase (Decrease)
	Amount			%	Amount			%	Amount			%
Japan	¥	130,387		38.4	¥	128,149		38.9	¥	(2,238	)	(1.7	)
United States of America		73,596		21.6		62,414		18.9		(11,182	)	(15.2	)
Asia		58,100		17.1		60,472		18.3		2,372		4.1
Europe		55,264		16.3		58,819		17.9		3,555		6.4
Others		22,574		6.6		19,804		6.0		(2,770	)	(12.3	)

Net sales	¥	339,921		100.0	¥	329,658		100.0	¥	(10,263	)	(3.0	)

Sales outside Japan	¥	209,534			¥	201,509			¥	(8,025	)	(3.8	)
Sales outside Japan to net sales		61.6	%			61.1	%

- 35 -

January 29, 2008

To All Persons Concerned


Name of Company Listed:		Kyocera Corporation

Name of Representative:		Makoto Kawamura, President and Director

		(Code number: 6971, The First Section of the Tokyo Stock Exchange, The First Section of the Osaka Securities Exchange)

Person for inquiry:		Akihiko Toyotani General Manager of Finance Division (Tel: 075-604-3500)

Execution of Corporate Split Agreement

regarding Acquisition of Mobile Phone Business of SANYO Electric Co., Ltd.

This is to advise you that Kyocera Corporation (the “Company”) has resolved at its meeting of the Board of Directors held on January 29, 2008 to authorize entry into a corporate split agreement with SANYO Electric Co., Ltd. (Headquarters: Moriguchi City, Osaka, President: Seiichiro Sano) (“SANYO”) regarding the acquisition of the mobile phone business of SANYO, with respect to which a final agreement was entered into as of January 21, 2008.

Such agreement will be executed subject to the condition that SANYO authorizes entry into such agreement at the meeting of its Board of Directors to be held on January 30, 2008.

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