Q1.	What is the reason selling, general and administrative expenses remained low during the April-June 2005 period in comparison to the scale of sales?
A1.	Selling, general and administrative expenses, particularly personnel expenses, were curbed compared to a year earlier, and we are of the opinion that they are currently being maintained at an appropriate level.

Q2.

What is the reason the gross profit margin improved substantially during the April-June 2005 period though sales fell compared to the January-March 2005 period?

A2.

The products recognized as revenue in April-June period were mostly those manufactured and shipped in the previous fiscal year when the operating rate of factory was high. The higher operating rate of factory normally leads to lower average unit cost of products manufactured at the time. Another factor is product-mix. Large sales from higher profitable products were also reported for the period. As a result, that the gross profit margin improved even as sales declined.

Q3.	What does an unusual profit of 800 million yen for the April-June 2005 period represent?
A3.	It represents a refund on the sales taxes paid by our Taiwanese subsidiary to the tax authorities.

Q4.	Why will the profit margin for the July-September 2005 period be lower than that for the April-June 2005 period?
A4.	The reason is that the gross profit margin for the July-September period tends to fall slightly due to the mixture of products marketed and that selling, general and administrative expenses, mainly development costs, rise as compared to the April-June period. These were expected when financial forecasts were announced in May 2005.

Q5.

Is it correct that orders hit bottom during the April-June 2005 period?

A5.

With respect to semiconductor production equipment (SPE), the effects of decreases in orders from Japanese device manufacturers were considerable. Taiwanese foundries' orders also remained at a very low level. Orders for FPD production equipment have recovered, and the current order receipt level is not low, combined with that for SPE, exceeding 100 billion yen. Prospects of future order receipt depend on when logic foundries' willingness to invest recovers, but we expect that the order receipt level for the July-September 2005 period will remain on the same as in the preceding quarter. We hope that orders will recover in subsequent quarters.

Q6.

What future trends do you project in orders for each application?

A6.

We continue to receive many inquiries from memory chip manufacturers and particularly feel that NAND flash manufacturers still have a very strong appetite for investment. MPU manufacturers' continued strategic investments are within our expectations while we are receiving an increasing number of inquiries about the most advanced production lines from logic foundries in Taiwan. System LSI manufacturers in Japan present a patchy appearance with some of them willing to make strategic investments and others not.

Q7.	What are the prospects of orders for SPE during the October-December 2005 period?
A7.	We cannot provide specific figures but expect that SPE orders will grow during the period.

Q8.	What is your view of growth in capital investments for semiconductors in 2005/2006?
A8.	We expect that capital investments for semiconductors will reach their peak between 2007 and 2008. Since the 2005/2006 period corresponds to a lull that comes after the previous peak in 2004, we predict that semiconductor-related capital investments for the period will show no marked fluctuations.

Q9.	What is the status of development investments for the 45nm node processes?
A9.	Our understanding is that device manufacturers, who are expected to benefit from further design rule shrinkage, are active in development investments, and we expect that some manufacturers will begin mass-production of 45nm node processes between 2007 and 2008.

Q10.	What is the status of competition in oxide film etch systems?
A10.	We lost market share in 2004 by several percentage points as a result of competition with other companies, but we still hold a share of over 60%. Plans call for further increasing our share of the market for oxide film etch systems by introducing new etch chambers whose shipments have already begun.

Q11.	What is the revenue environment for FPD production equipment?
A11.	Our FPD etch/ash systems are steadily holding a high market share and contributing to the company's profits. In terms of revenue, FPD coaters/developers will continue to face difficulties throughout the current fiscal year, but with introduction of new generation models scheduled for the next fiscal year, we hope that the profitability of FPD coaters/developers will improve in the years to come.

Q12.

What is your vision of a business for products utilizing RLSA plasma?

A12.

Starting with the second half of the current fiscal year, semiconductor device manufacturers are expected to adopt the oxidation and nitridation processes, currently being promoted in the market, for mass-production. In the future, we will make the most of the characteristics of low electron temperature to use RLSA plasma for a number of applications with the aim of developing this into a 100 billion yen business.

Q13.	What is your plan for differentiation of your semiconductor production equipment from the competition?
A13.	One example is to incorporate integrated metrology technology, provided by Timbre, our American subsidiary, into semiconductor production equipment in order to enable improvement in productivity of semiconductor devices and reflect measurement results in semiconductor production processes. We hope to use this technology to differentiate our processes from the competition.

Q14.	Do you intend to increase R&D investment as a percentage of sales?
A14.	As a result of the ongoing structural reforms, cash flows have improved substantially. We have not determined the target for the ratio, but we plan to actively invest generated cash in R&D

Q15.	What is your future merger and acquisition (M&A) strategy?
A15.	At present, we have no major M&A plans, but will actively consider M&A if there are technologies involved with high growth potential.

Q16.	Are you still considering increasing the number of shares you are authorized to issue, a plan that was rejected at the annual general meeting of shareholders held in June 2005?
A16.	Currently, there is no specific threaten of a takeover. Therefore, we plan to study measures for defending ourselves from a takeover clearly impairing the shareholders' common interest from various angles by the annual general meeting of shareholders in 2006.