SOURCE: TDK Corporation

June 06, 2005 02:01 ET

TDK Corporation announces Notice of the Convocation of the 109th Ordinary General Meeting of Stockholders

Tokyo, Japan -- (MARKET WIRE) -- June 6, 2005 --

                                                           June 2, 2005
                                                                       
To:    Our Overseas Stockholders

                                                        TDK Corporation
                                              13-1, Nihonbashi 1-chome,
                                                         Chuo-ku, Tokyo

                        TDK Corporation (the "Company")
                  Notice of the Convocation of the 109th 
                 Ordinary General Meeting of Stockholders

Dear Sirs:

         Enclosed please find the notice of the convocation of the 
109th ordinary general meeting of stockholders of the Company 
together with the reference documents.

         Please study the reference documents with respect to each
item of the agenda of the meeting and exercise your voting rights 
through your standing proxy in Japan.  Please be aware that the 
voting right exercise form should arrive at us through your 
standing proxy in Japan on or prior to June 29, 2005.


Very truly yours,



TDK Corporation



BY:/s/  Noboru Hara
Noboru Hara
General Manager
General Affairs Department
Administration Group




(Translation)


                           NOTICE OF THE CONVOCATION

                                       OF

               THE 109TH ORDINARY GENERAL MEETING OF STOCKHOLDERS

          
Notice:   This is a translation from Japanese language of a notice 
          distributed to stockholders in Japan.  The translation is 
          prepared solely for the convenience of foreign shareholders.  
          In the case of any discrepancy between the translation and 
          the Japanese original, the latter shall prevail.



                                TDK Corporation

                                  Tokyo, Japan

(Translation)
To:  Stockholders

                                                      Local Code  6762
                                                                      
                                                          June 2, 2005
                                                                      
                                       TDK Corporation (the "Company")
                                              13-1, Nihonbashi 1-chome
                                                        Chuo-ku, Tokyo
                                                         Hajime Sawabe
                                                     President and CEO

                                                                      
                            NOTICE OF CONVOCATION OF
               THE 109TH ORDINARY GENERAL MEETING OF STOCKHOLDERS


Dear Sirs:

          You are hereby notified that the 109th Ordinary General 
Meeting of Stockholders will be held as stated below.  You are 
respectfully requested to attend the meeting.

            When you attend the meeting in person, please submit 
the enclosed voting right exercise form to the receptionist at 
the place of the meeting.  In the event that you are unable to 
attend the meeting, please study the reference documents below 
and indicate on the enclosed voting right exercise form your
approval or disapproval of the items on the agenda, since you 
may exercise your voting right by written form by returning 
the form to the Company after affixing your seal impression.


                                  Particulars
     
1.   Date and Time:                  10:00 a.m. on June 29, 
                                     2005 (Wednesday)
     
2.   Place of the Meeting:           Technical Center of the Company, 
                                     9th Floor
                                     15-7, Higashi-Ohwada 2-chome, 
                                     Ichikawa-shi,
                                     Chiba Prefecture
     
3.   Purposes of the Meeting:

     Matters to be Reported:
                                
                          1.   Report on the Business Report, 
                               Non-Consolidated 
                               Balance Sheet and Non-consolidated 
                               Statement of Income for the 109th 
                               Fiscal Year (from April 1, 2004 to 
                               March 31, 2005).
                               
                          2.   Report on the Consolidated Balance 
                               Sheet and Consolidated Statement of
                               Income, and Report on
                               the Results of Audit for Consolidated 
                               statutory reports for the 109th Fiscal 
                               Year by Certified Public Accountants and
                               Board of Corporate Auditors (from 
                               April 1, 2004 to March 31, 2005).

     Matters to be Resolved:

          First Item:          Approval of Proposal for Appropriation
                               of Retained Earnings for the 109th 
                               Fiscal Year

          Second Item:         Issuance of Stock Acquisition Rights as
                               Stock Option Scheme for Stock-Linked 
                               Compensation Plan
                               The substances of this item are 
                               contained in the "Reference Documents 
                               Concerning Exercise of Voting Rights" 
                               (from Page 37 to page 39)

          Third Item:          Issuance of Stock Acquisition Rights
                               as Stock Option Scheme
                               The substances of this item are 
                               contained in the "Reference Documents
                               Concerning Exercise of Voting Rights"
                               (from Page 39 to page 41)

          Fourth Item:         Acquisition of Own Shares of the 
                               Company
                               The substances of this item are 
                               contained in the "Reference Documents 
                               Concerning Exercise of Voting Rights"
                               (Page 41)

          Fifth Item:          Election of seven (7) Directors

                                                             - End -

                (Documents Attached to the Notice of Convocation
                of the Ordinary General Meeting of Stockholders)

Supplementary Information (1)

                                Business Report
                              From: April 1, 2004
                               To: March 31, 2005

1.      Business Conditions
(1)    Business Conditions and Results of TDK Group

Looking at economies in Japan and overseas, despite rising crude oil
prices and other factors that restricted growth, the U.S. economy 
generally expanded steadily due in part to an upturn in capital 
expenditures and improvements in employment statistics and household 
incomes. European economies, while resilient in the first half of 
fiscal 2005, suffered a slowdown in the second half due to the effects
of a strengthening euro, rising crude oil prices and other negative
factors. China, meanwhile, maintained a high economic growth rate. In
comparison, the Japanese economy slowed due to a drop-off in exports, 
the result of second-half production cutbacks by manufacturers of 
digital products, despite strength in capital expenditures that was 
supported by strong corporate earnings.

In the electronics industry in the first half of fiscal 2005, demand 
for digital home appliances, such as LCD and plasma flat-screen TVs 
and DVD recorders, was boosted by the Summer Olympic Games in Athens,
and other events. This resulted in strong demand for the TDK Group's 
electronic components in the first half.However, demand for these 
components began to cool in the second half in line with production 
cutbacks of finished products that use them.

In this business environment, TDK continued to implement profit 
structure reforms. TDK also actively made investments to drive growth, 
such as by ramping up production capacity of multiplayer chip 
capacitors and forging a strategic alliance regarding HDD heads.

As a result, TDK posted consolidated net sales of Yen 657,853 million, 
up 0.3% from Yen 655,792 million. Operating income rose 5.9%, from 
Yen 56,510 million to Yen 59,830 million. Income from continuing 
operations before income taxes increased 11.4%, from Yen 55,712 million 
to Yen 62,072 million. Net income rose 6.8%, from Yen 42,101 million to 
Yen 44,948 million. Basic net income per common share was Yen 339.76, 
up from Yen 317.80.

On a parent-company basis, net sales increased 3.9%, from Yen 316,050 
million to Yen  328,452 million. Operating income increased 392.8%, 
from Yen 1,756 million to Yen  8,653 million. Current income rose 
197.3%, from Yen 10,277 million to Yen 30,550 million. Net income 
increased 786.3%, from Yen 4,458 million to Yen 39,513 million. Net 
income per common share was Yen 297.93, compared with Yen 32.87 a 
year earlier.

Regarding discontinued operations, figures for the year ended March 
31, 2004 relating to discontinued operations have been reclassified 
and restated, in accordance with Statement of Financial Accounting 
Standards No. 144, "Accounting for the Impairment or Disposal of 
Long-Lived Assets," for comparative purposes.

(2)    Segment Information of TDK Group
TDK's businesses are broadly classified into two business segments: 
the electronic materials and components segment and the recording 
media & systems segment.

(Electronic Materials and Components Segment)
This segment is made up of four product sectors: (1)electronic 
materials, (2) electronic devices, (3)recording devices, and 
(4)semiconductors & others.  Segment net sales increased 4.9%, 
from Yen 519,792 million to Yen 545,214 million.

Looking at electronic materials and electronic devices, demand 
for components was strong in the fiscal year's first half on the 
back of higher demand for digital home appliances driven by the 
Athens Summer Olympic Games. However, the second half saw sales 
prices of components drop as demand cooled due to inventory 
cutbacks of digital home appliances. The overall result, however, 
was a year-on-year increase in sales of both electronic materials 
and electronic devices.

In recording devices, in the first half of fiscal 2005 there were 
inventory cutbacks by customers following strong HDD demand in the 
second half of the previous fiscal year. However, demand for HDD 
heads picked up in the second half of fiscal 2005 once this 
adjustment phase ended. The result was a year-on-year increase in 
sales of recording devices.

Sector results were as follows.

(1)Electronic Materials
This sector is broken down into two product categories: capacitors, 
and ferrite cores and magnets. Sales in the electronic materials 
sector rose 4.8%, from Yen 166,818 million to Yen 174,800 million.

(Capacitors) Sales rose year on year. Sales of multilayer chip 
capacitors, the main product in the capacitors sector, were strong 
in the first half, as previously mentioned. In the second half, 
amid lackluster demand, TDK was able to absorb sales price declines 
and the effect of forex movements by improving the sales mix. These 
factors led to higher year-on-year sales.

(Ferrite cores and magnets) Sales of ferrite cores and magnets 
increased year on year. In ferrite cores, sales declined from the 
previous fiscal year despite higher demand for general-purpose power 
supply cores for digital home appliances and cores for communications 
equipment. This decrease was due to a reduction in output of 
deflection yoke cores and flyback transformers cores used in CRT TVs.
However, sales of magnets increased year on year, the result of 
steadily rising demand for use in automotive and HDD applications.

(2)Electronic Devices
This sector has three product categories: inductive devices, 
high-frequency components and other products. Sales in the electronic 
devices sector rose 7.8%, from Yen 107,999 million to Yen 116,387 
million.

(Inductive devices) Sales increased year on year. Inductive devices, 
the main product category in the electronic devices sector, posted 
higher sales despite lower sales prices and the negative effect of 
forex movements. The increase was attributable to higher demand 
spurred by acceleration in the pace at which automobiles are 
incorporating electronics and the increasing sophistication of
mobile phones, as well as new product launches.

(High-frequency components) Sales of high-frequency components 
declined marginally year on year because higher sales volume and 
an improved product mix failed to completely offset persistently 
strong discounting pressure from mobile phone handset manufacturers, 
the main customer for these components.

(Other products) Sales of other products rose year on year. In 
power systems, sales of DC-DC converters and DC-AC inverters were 
healthy. Sensors and actuators recorded higher sales due to growth 
in demand for use in PCs and peripherals and communications 
equipment. As a result of this, overall sales of other products 
were higher than in the previous fiscal year.

(3)Recording Devices
This sector has two product categories: HDD heads and other heads.
Sector sales increased 1.9%, from Yen 230,105 million to 
Yen 234,578 million.

(HDD heads) Sales increased year on year. In HDD heads, the main 
product in this sector, TDK had to overcome the loss of business 
from a major customer that started producing heads in house in 
2004, as well as the impact of falling sales prices and 
unfavorable forex movements. Cutbacks in HDD inventories at 
customers in the first half of the year also shaped the market. 
However, demand for HDD heads rose in the second half of the fiscal 
year following the end of these cutbacks, leading to higher 
year-on-year sales.

(Other heads) Sales of other heads declined year on year, due to 
sluggish sales of optical pickups.

(4)Semiconductors & Others
Sector sales climbed 30.8%, from Yen 14,870 million to Yen 19,449 
million. TDK recorded slightly higher sales of anechoic chambers 
for electronmagnetic noise control and growth in external sales of 
manufacturing equipment due to higher investments in semiconductor 
facilities and equipment by customers.

(Recording Media & Systems Segment)
This segment is made up of four product categories: audiotapes, 
videotapes, optical media and other products. Segment sales 
declined 17.2%, from Yen 136,000 million to Yen 112,639 million.

(Audiotapes and videotapes) Sales of audiotapes and videotapes 
declined year on year. While TDK maintained a high market share, 
demand is declining for these products as a whole.

(Optical media) Sales of optical media increased, with higher
DVD sales volumes offsetting a sharp fall in prices of DVDs and
lower CD-R sales.

(Other products) Sales of other products decreased year on year.
 There was an increase in sales of LTO-standard* (Linear Tape-Open) 
tape-based data storage media for computers. However, a decline in 
sales caused by the sale in the previous fiscal year of a U.S. 
software development subsidiary and lower sales of recording 
equipment brought overall sales of other products down year on
year.

*Linear Tape-Open, LTO, LTO logo, Ultrium and Ultrium logo are 
trademarks of HP, IBM and Certance LLC in the U.S., other 
countries or both.

Sales by main product sector were as follows:

(Consolidated)
                                                   (Yen  millions)
Division          Main Applications          Amount   Share of YoY
                                                      Sales    Change

Electronic                                   545,214  82.9%    4.9%
materials and
components
   Electronic     AV, office, communications 174,800  26.6     4.8
   materials      and other types of
                  equipment; automobiles,
                  etc.
   Electronic     AV, office, communications 116,387  17.7     7.8
   devices        and other types of
                  equipment; automobiles,
                  etc.
   Recording      PCs and PC peripherals     234,578  35.7     1.9
   devices
   Semiconductors Office equipment,          19,449   2.9      30.8
   & others       communications equipment,
                  etc.
Recording media & Entertainment, education,  112,639  17.1     -17.2
systems           professional broadcasting,
                  etc.
Total                                        657,853  100.0    0.3
Incl. export                                 473,828  72.0     -2.7
sales

(Note) Amounts less than Yen 0.5 million have been rounded downward 
       and amounts not less than Yen 0.5 million have been rounded 
       upward.

(Non-Consolidated)
                                                      (Yen  millions)
Division          Main Applications          Amount   Share of YoY
                                                      Sales    Change

Electronic                                   284,799  86.7%    5.1%
materials and
components
   Electronic     AV, office, communications 139,326  42.4     6.4
   materials      and other types of
                  equipment; automobiles,
                  etc.
   Electronic     AV, office, communications 87,736   26.7     8.2
   devices        and other types of
                  equipment; automobiles,
                  etc.
   Recording      PCs and PC peripherals     35,828   10.9     -10.9
   devices
   Semiconductors Office equipment,          21,909   6.7      16.6
   & others       communications equipment,
                  etc.
Recording media & Entertainment, education,  43,652   13.3     -3.0
systems           professional broadcasting,
                  etc.
Total                                        328,452  100.0    3.9
Incl. export                                 193,241  58.8     5.6
sales

(Note)  Amounts less than Yen 1 million have been rounded downward.

(3) Capital Expenditures and Fund Procurement of TDK Group
Consolidated capital expenditures were Yen 61,005 million, the 
result of active investments in fields TDK regards as strategically 
important for growth.

In the electronic materials and components segment, capital 
expenditures totaled Yen 57,192 million. The bulk of the capital 
expenditures were for facilities to develop and produce HDD heads 
with higher areal density and for facilities to increase production 
and rationalize operations for multilayer chip capacitors. In the 
recording media & systems segment, capital expenditures totaled 
Yen 3,813 million, mainly for facilities to increase DVD production.

Funds for these capital expenditures were provided by cash on hand.

(4) Operating Results and Financial Position of TDK Group and the 
Company

(Consolidated Results)
                                                 (Yen  millions)

 Term           106th          107th          108th          109th

 Item           (Apr. 1,       (Apr. 1,       (Apr. 1,       (Apr. 1,
                2001           2002           2003           2004  
                to Mar.        to Mar.        to Mar.        to Mar.
                31,            31,            31,            31,    
                2002)          2003)          2004)          2005)  

 Net sales      564,286        604,865        655,792        657,853

 Net income     (25,771)       12,019         42,101         44,948 
 (loss)                                                             

 Basic net      (193.91)       90.56          317.80         339.76 
 income (loss)                                                      
 per common                                                         
 share (Yen )                                                       

 Stockholders'  583,927        553,885        576,219        650,715
 equity                                                             

 Total assets   749,910        747,337        770,319        790,020


(Non-Consolidated Results)
                                                    (Yen  millions)

 Term           106th          107th          108th          109th 

 Item           (Apr. 1,       (Apr. 1,       (Apr. 1,       (Apr. 1,
                2001           2002           2003           2004  
                to Mar.        to Mar.        to Mar.        to Mar.
                31,            31,            31,            31,    
                2002)          2003)          2004)          2005)  

 Net sales      317,811        320,697        316,050        328,452

 Net income     (3,794)        133            4,458          39,513
 (loss)                                                            

 Net income     (28.55)        0.53           32.87          297.93
 (loss) per                                                        
 common share                                                      
 (Yen )                                                            

 Stockholders'  426,439        419,241        415,878        447,480
 equity                                                             

 Total assets   522,140        509,561        526,143        538,877

               
(Notes)   1.   Consolidated amounts less than Yen 0.5 million have 
               been rounded downward and amounts not less than 
               Yen 0.5 million have been rounded upward.
          2.   Non-consolidated amounts less than Yen 1 million have 
               been rounded downward.
          3.   Consolidated net sales for the 106th, 107th and 
               108th terms have been restated in relation to 
               operations that were classified as discontinued 
               operations in the 109th term in accordance with 
               Statement of Financial Accounting Standards No. 144, 
               "Accounting for the Impairment or Disposal of Long-
               Lived Assets."
          4.   TDK adopted the Emerging Issues Task Force Issue 01-9
               ("EITF 01-9"), "Accounting for Consideration Given by 
               a Vendor to a Customer (Including a Reseller of the 
               Vendor's Products)" effective from the 107th term. 
               Accordingly, consolidated net sales for the 106th 
               term have been restated to conform to the subsequent 
               presentation.
          5.   Consolidated basic net income (loss) per common share 
               and non-consolidated net income (loss) per common 
               share are computed based on the weighted average 
               number of shares of common stock outstanding during 
               the period.
          6.   Net income (loss) per common share is computed after 
               deducting treasury stock.
          7.   Non-consolidated net income per common share is 
               based on "Accounting Standard for Earnings Per Share" 
               (Financial Accounting Standard No. 2) and 
               "Implementation Guidance for Accounting Standard for 
               Earnings Per Share" (Financial Accounting Standards 
               Implementation Guidance No. 4) beginning with the 
               107th term.

In the 106th term, sales and earnings declined on both a 
consolidated and non-consolidated basis. Results in the 106th term 
partly reflect the inclusion of restructuring costs for reforms 
to the profit structure.

In the 107th term, sales and earnings increased on both a 
consolidated and non-consolidated basis due to higher demand for 
electronic components and a higher return on assets.

In the 108th term, sales and earnings increased on a consolidated 
basis due to strong performances in the recording devices sector 
and other areas. However, sales fell while earnings increased on 
a non-consolidated basis due to a change in the form of 
transactions with business partners and other factors.

For results for the 109th term, please refer to the foregoing "
(1) Business Conditions and Results" and "(3) Capital Expenditures 
and Fund Procurement."

(5) Key Issues for TDK Group
The world economy is grappling with a host of risk factors such as 
surging crude oil prices and raw materials costs, and fluctuations 
in the foreign exchange rates of major currencies. It is also 
being influenced by the effects of developments in the U.S., 
which is burdened with current-account and budget deficits, and in 
China, which continues to achieve a high rate of growth. With 2005 
also the trough of the current semiconductor cycle, there is a 
persistent sense of uncertainty about the economic outlook.

Against this economic backdrop, from a medium-term perspective, the 
electronics industry is expected to see the growth of digital home 
appliances, the convergence of information and communications, as 
typified by the increasingly diverse functions offered by mobile 
phones, and the greater use of electronics in motor vehicles. 
These trends are expected to result in continued expansion in
demand for the electronic components that the TDK Group develops, 
manufactures and sells.

At the same time, however, in the dynamically changing electronics 
industry, a faster response than ever before will be required by 
the company's electronic components business. The TDK Group has 
continuously reformed and improved the structure of its businesses, 
but it believes that responding to the changes in the electronics 
industry requires making this process of reform and improvement
an ongoing drive. Furthermore, in the digital era of the 
electronics industry, falling prices due to stiffer competition 
with new products, greater inventory risk and other challenges are 
unavoidable. Nevertheless, the TDK Group is determined to be a 
company that can surmount these challenges and grow. And, to
remain an attractive and exciting company, TDK aims to grow by 
creating greater value. In this vein, the TDK Group will refine 
its core technologies (materials, process and evaluation & 
simulation technologies) while concentrating on three
fast-growing key fields: IT home electronics; high-speed, 
large-capacity networks; and car electronics. Increasing TDK's 
ability to generate earnings by supplying products and 
technologies imbuing value that these markets demand on a
timely basis is a key issue. Moreover, TDK will take on the 
challenge of advancing along a growth trajectory while making 
investments that are prudent yet aggressive.

TDK will unite as a company to take up the challenge of executing 
the following initiatives in the year ending March 31, 2006.
          
   - Make aggressive investments through a process of selection 
     and concentration TDK aims to quickly commercialize products 
     by prioritizing investments, focusing on fields where it can 
     set itself apart in the marketplace with its ability to 
     develop materials and the process technologies that use 
     these materials.

   - Bolster manufacturing capabilities matched to the market 
     TDK will strengthen integration between the development and 
     manufacturing groups to upgrade technological capabilities 
     and add value to products. Furthermore, TDK intends to 
     proceed with efforts to pinpoint unprofitable businesses to 
     reform or exit.

   - Expedite development
     TDK will focus on speeding up development by raising 
     efficiency through measures such as a more robust technology 
     strategy and improvements to processes.

   - Expand the Chinese market
     TDK views China as a very important market for the group. 
     While paying attention to the various risks in this market, 
     TDK will endeavor to expand its business by strengthening its 
     competitiveness in terms of cost, quality and delivery time.

   - Strengthen human resources
     TDK regards the development of employees as the starting point
     for creating new products with value, making businesses more 
     competitive and taking on other challenges that will drive the 
     growth of the company. Based on this thinking, the TDK Group 
     will strengthen human resources such as through 
     education, respecting each and every employee.

Besides strengthening its business in this way, TDK also recognizes 
corporate social responsibility and corporate governance as important 
management themes. TDK is therefore reaffirming the importance of 
coexisting with society as a responsible corporate citizen by 
conducting its own social activities based on two key corporate 
philosophies: "Creativity" and "Culture." Furthermore, TDK will 
comply with the U.S. Sarbanes-Oxley Act of 2002 and all other 
applicable laws and regulations as it strengthens corporate 
governance.

TDK believes that enhancing corporate governance is vital to 
improving management fairness, impartiality and transparency. TDK 
employs the corporate auditor system within the meaning of the 
Commercial Code of Japan. But there are also various systems and 
organizations for promoting corporate governance. TDK has elected 
one outside director to the seven-member Board of Directors and
three of the company's five corporate auditors are from outside 
the company. In addition, it has appointed corporate officers and 
has established various committees, namely the Compensation Advisory 
Committee, the Corporate Ethics Committee and the Disclosure 
Committee. TDK is determined to enhance each of these systems and 
organizations to manage the company in a way that earns the
trust of stockholders and other stakeholders.

As always, TDK requests the continued support and guidance of 
stockholders
     
2.   Outline of TDK Group and the Company

     (The following sets forth the conditions of TDK Group and 
     the Company as of March 31, 2005 unless otherwise
     specifically indicated.)

(1)  Principal Business of TDK Group

     TDK Group is principally engaged in the manufacture and sale 
     of products of electronic materials and components, as well 
     as recording media and systems.  Major products by division 
     are as follows:

Division                         Major Products

Electronic materials and
components
    Electronic materials         ferrite cores, ferrite and 
                                 rare-earth magnets, multilayer chip
                                 capacitors
    Electronic devices           high-frequency components, EMC 
                                 components, piezoelectric products, 
                                 sensors, inductors, transformers, 
                                 switching power supplies,
                                 DC-DC converters
    Recording devices            HDD heads, thermal heads, optical 
                                 pickups
    Semiconductors & others      organic electroluminescent (EL), 
                                 anechoic chambers
Recording media & systems        audiotapes, videotapes, CD-Rs, 
                                 MDs, DVDs, "BS"/"CS" antenna, PC 
                                 software, tape-based date storage 
                                 media for computers

(2)    Major Business Offices and Plants of TDK Group

            (1)  The Company:

Types of offices         Location

Head Office              13-1, Nihonbashi 1-chome, Chuo-ku, 
                         Tokyo
Business Offices         Sendai, Tokyo, Yokohama, Nagoya, Matsumoto,
                         Osaka, Hiroshima, Matsuyama, Fukuoka
Plants                   Chokai Plant (Akita Pref.), Akita Plant 
                         (Akita Pref.), Kisakata Plant (Akita 
                         Pref.), Inakura Plant (Akita Pref.),
                         Narita Plant (Chiba Pref.), Shizuoka 
                         Plant (Shizuoka Pref.),
                         Kofu Plant (Yamanashi Pref.),
                         Chikumagawa Plant (Nagano Pref.)
                         Chikumagawa 2nd Technical Center 
                         (Nagano Pref.)
                         Mikumagawa Plant (Oita Pref.)
Research &Development    Advanced Process Technology Center 
                         (Chiba Pref.)
Facilities               Chikumagawa 1st Technical Center 
                         (Nagano Pref.)

          (Note)   Chikumagawa 2nd Technical Center changed its 
name to Asama Techno Factory as of April 1, 2005.

            (2)  Consolidated Subsidiaries:

Classification         Name of Company   (Location of Headquarters)

Administration and     TDK U.S.A. Corporation(The State of New York,
Superintended          U.S.A.)
                       TDK Europe S.A.(Bascharage, Luxembourg)
                       TDK China Company Limited.(Shanghai, China)
Sales                  TDK Electronics Corporation
                       (The State of New York, U.S.A.)
                       TDK Corporation of America(The State of 
                       Illinois, U.S.A.)
                       TDK Electronics Europe GmbH(Dusseldorf, 
                       Germany)
                       TDK Marketing Europe GmbH(Rattingen, Germany)
                       TDK Hong Kong Company Limited(Hong Kong, 
                       China)
                       TDK Marketing Corporation(Chiyoda-ku, Tokyo)
Production             Headway Technologies, Inc.(The State of 
                       California , U.S.A.)
                       TDK Recording Media Europe S.A. (Bascharage,
                       Luxembourg)
                       TDK (Malaysia) Sdn. Bhd.
                       (The State of Negri Sembilan, Malaysia)
                       TDK Xiamen Company Limited.(Xiamen, China)
                       SAE Magnetics (Hong Kong) Limited(Hong Kong, 
                       China)
                       TDK Taiwan Corporation(Taipei, Taiwan)
                       TDK-MCC Corporation(Yuri-gun, Akita Pref.)

(3)    Matters Concerning Shares

            (1)     Total Number of Shares:
                    Number of Shares Authorized
                    to be Issued 
                    by the Company:            480,000,000 shares

                    Number of 
                    Shares Issued:             133,189,659 shares
            (2)     Number of 
                    Stockholders:              23,295 stockholders
                 (a decrease of 2,655 from the end of the 
                 preceding fiscal year)

            (3)     State of Stock Acquisition Rights:

Stock acquisition rights already issued:

                        Number of stock   Types and      Issue price
                        acquisition       number of
                        rights            shares 
                                          issued upon
                                          exercise 
                                          of stock
                                          acquisition 
                                          rights

1st stock acquisition   1,716             Common Stock  Free of 
rights                                                  charge
(Pursuant to resolution                   171,600
adopted at the Ordinary
General Meeting of
Stockholders held on
June 27, 2002)
2nd stock acquisition   2,537             Common Stock  Free of 
rights                                                  charge
(Pursuant to resolution                   253,700
adopted at the Ordinary
General Meeting of
Stockholders held on
June 27, 2003)
3rd stock acquisition   2,343             Common Stock  Free of 
rights                                                  charge
(Pursuant to resolution                   234,300
adopted at the Ordinary
General Meeting of
Stockholders held on
June 29, 2004)

            (4)  Principal Stockholders (ten largest stockholders):

                    Investment to the        Investment to the
                    Company                  Principal Stockholders
                                             of the Company
                    
Name of stockholder Number of    Percentage  Number of    Percentage
                    shares held  of shares   shares held  of shares
                                 held                     held
                    (thousands   (%)         (thousands   (%)
                    of shares)               of shares)

The Master          17,271       12.96       --           --
Trust Bank of       
Japan, Ltd.
(Trust account)
Japan Trustee       13,869       10.41       --           --
Services Bank,   
Ltd.
(Trust account)
Matsushita Electric 6,249        4.69        999          0.04
Industrial 
Co., Ltd.
Barclays Bank PLC   2,849        2.14        --           --
Barclays     
Capital Securities
                                             --           --
The Chase           2,730        2.05        --           --
Manhattan Bank, NA   
London
BNP Paribas         2,506        1.88        --           --
Securities (Japan) 
Ltd.
State Street        2,481        1.86        --           --
Bank and Trust    
Company
Nippon Life         2,415        1.81        --           --
Insurance Company  
Societe Generale    2,359        1.77        --           --
(Paris OBE    
Diept)
Calyon DMA OTC      2,260        1.69        --           --
                    
     (Notes)   1.   With respect to the number of shares held 
                    and the percentage of shares above, any 
                    number of shares less than one thousand 
                    has been disregarded.
               2.   With respect to the investment in 
                    Matsushita Electric Industrial Co., Ltd., 
                    the Company holds the shares through 
                    Mitsui Asset Trust & Banking Co., Ltd., to 
                    which the Company 
                    has entrusted trust assets.  Mitsui Asset 
                    Trust & Banking Co., Ltd. is acting as a 
                    trustee of the Company, who is a
                    transfer agent of the Company.
                    The Company reserves the right to instruct 
                    the exercise of voting rights of the shares 
                    held by the Company under the 
                    trust deeds.

(4)  Acquisition, Disposal and Holding of the Company's Own Shares
          
     (1)  Shares acquired:
            Shares of common stock:               237,887 shares
            Aggregate amount of acquisition cost: Yen 1,682,902,724

     (2) Shares disposed:
            Shares of common stock:               73,022 shares
            Aggregate amount of disposal cost:    Yen 578,365,235

     (3) Number of shares held for the fiscal year under review:
                                                  945,072 shares of
                                                  common stock

(5)    Matters Concerning Employees of TDK Group and the Company

         (1)  Employees of TDK Group:

Business Division                    Number of      Changes from
                                     Employees      preceding fiscal
                                                    year

Electronic materials and components  33,050         699 (increased)
Recording media & systems            2,593          314 (decreased)
Other companies (all segment)        1,472          74 (decreased)
TOTAL                                37,115         311 (increased)

         (2)  Employees of the Company:

Number of          Changes from       Average Age    Average Working
Employees          preceding fiscal                  Years
                   year

5,190              133 (decreased)    39.9           17.9 years
               
(Notes)   1.   The number of employees represents the personnel in 
               office.
          2.   Temporary or part-time employees are not included in 
               the list above.
          3.   Any portion of the average age or average working 
               years is presented by rounding down the two places 
               of decimals.

(6)    Matters Concerning Principal Business Combination of TDK Group

         (1) Matters Concerning Principal Consolidated Subsidiaries:

Name of companies   Common Stock         Percentage of Outline 
                                         shares held   of 
                                         by the        Principal
                                         Company       Business

TDK U.S.A.          USD283,550 thousand  100.0%        Management and
Corporation                                            supervision 
(U.S.A.)                                               of U.S.
                                                       subsidiaries

TDK Electronics     USD62,849 thousand   100.0%        Sale of 
Corporation                                            recording
(U.S.A.)                                               media 
                                                       & systems
                                                       products

TDK Corporation of  USD3,800 thousand    100.0%        Sale of 
America (U.S.A.)                                       electronic
                                                       materials &
                                                       components

TDK Taiwan          NTD424,125 thousand  83.8%         Manufacture 
Corporation                                            and sale
(Taiwan)                                               of electronic
                                                       materials &
                                                       components

SAE Magnetics       HKD50 thousand       100.0%        Manufacture 
(Hong Kong)                                            and sale
Limited                                                of electronic
(Hong Kong)                                            materials &
                                                       components

TDK Hong Kong       HKD25,500 thousand   100.0%        Manufacture 
Company Limited.                                       and sale
(Hong Kong)                                            of electronic
                                                       materials &
                                                       components

TDK Xiamen Company  RMB319,771 thousand  100.0%        Manufacture 
Limited. (China)                                       and sale
                                                       of electronic
                                                       materials &
                                                       components

TDK Recording       Euro 82,846 thousand 100.0%        Manufacture of
Media Europe S.A.                                      recording 
(Luxembourg)                                           media & 
                                                       systems
                                                       products

TDK Electronics     Euro 46,544 thousand 100.0%        Sale of 
Europe GmbH                                            electronic
(Germany)                                              materials &
                                                       components

TDK Marketing       Euro 20,025 thousand 100.0%        Sale of 
Europe GmbH                                            recording
(Germany)                                              media & systems
                                                       products

TDK-MCC             Yen 1,000 million    100.0%        Manufacture of
Corporation                                            electronic 
(Japan)                                                materials
                                                       & components

TDK Marketing       Yen 1,050 million    100.0%        Sale of 
Corporation (Japan)                                    recording
                                                       media & systems
                                                       products
               
(Notes)   1.   Any portion less than one-tenth of one percent of 
               the percentage of shares held by the Company is 
               disregarded.
          2.   Out of companies stated above, the Company 
               indirectly owns 100% of:
                                TDK Electronics Corporation
                                TDK Corporation of America
                                SAE Magnetics (Hong Kong) Limited
                                TDK Recording Media Europe S.A.
                                TDK Electronics Europe GmbH
                                TDK Marketing Europe GmbH
         3.   The Company owns indirectly 85.5% shares of TDK 
              Xiamen Co., Ltd.
     
(2)  Condition of Business Combination:
     The total number of consolidated subsidiaries for the previous 
     fiscal year totaled 72 (domestic 20, overseas 52).  During the
     fiscal year under review, six companies decreased.  This was 
     attributable to the fact that three sales subsidiaries of the 
     recording media & system products in Europe were change to the 
     branch under the subsidiary for the said products in Germany, 
     one manufacturing subsidiary in Japan and one manufacturing 
     subsidiary in Asia were liquidated, respectively, as well as 
     one logistics subsidiary in Japan was liquidated upon merger.  
     On the other hand, the Company incorporated one research and 
     development subsidiary in each of the U.S. and Asia, 
     respectively, and one manufacturing subsidiary, one sales 
     subsidiary and one regional superintended subsidiary were 
     respectively established in the Asian area.  As a result, a 
     total of five companies were included in consolidation.  The 
     number of consolidated subsidiaries is 71 (domestic 18, 
     overseas 53).  While affiliates as to investment in which the 
     equity method of accounting has been carried out was previously 
     8 (domestic 5, overseas 3), they are 6 (domestic 4, overseas 2) 
     for the fiscal year under review.
     
(3)  Results of Business Combination:

     The number of consolidated subsidiaries including the twelve 
     principal subsidiaries stated above is 71 and that of 
     affiliates as to investment in which the equity method of 
     accounting has been carried out is six. Consolidated net sales 
     for the fiscal year under review amounted to Yen 657,853 million 
     (an increase of 0.3% compared with the preceding fiscal year) 
     and consolidated net income amounted to Yen 44,948 million (an 
     increase of 0.3% compared with the preceding fiscal year).

(7)  Major Lenders, Amount of Loans and Number of the Shares of the 
     Company Owned

          Not applicable.
     
(8)  Name, Position and Duty, or Major Occupation of Each Director 
     and Corporate Auditor

  Position                 Name               Duty and Major
                                              Occupation

  Representative Director  Hajime Sawabe

  Director                 Jiro Iwasaki       General Manager 
                                              of Administration 
                                              Group, in charge
                                              of Safety & 
                                              Environment

  Director                 Shinji Yoko        General Manager 
                                              of Electronic
                                              Components Sales 
                                              & Marketing
                                              Group

  Director                 Takeshi Nomura     General Manager 
                                              of Ferrite &
                                              Magnet Products 
                                              Business Group

  Director                 Mitsuaki Konno     General Manager 
                                              of Management
                                              Review and Support 
                                              Department

  Director                 Yasuhiro Hagihara  Attorney-at-Law, 
                                              Partner of the
                                              Law Firm of 
                                              Squire Sanders &
                                              Dempsey L.L.P. 
                                             (Gaikokuhou Jimu
                                              Bengoshi Jimusho)

  Director                 Takehiro Kamigama  General Manager 
                                              of Head
                                              Business Group

  Corporate Auditor        Masaaki Miyoshi    Full-time

  Corporate Auditor        Takuma Otsuka      Full-time

  Corporate Auditor        Kazutaka Kubota

  Corporate Auditor        Kaoru Matsumoto    C.P.A., Accounting 
                                              Firm of
                                              Kaoru Matsumoto

  Corporate Auditor        Ryoichi Ohno       Senior Vice 
                                              President and Chief
                                              Financial Officer 
                                              of The
                                              Gibraltar Life 
                                              Insurance Co.,
                                              Ltd.
               
(Notes)   1.   Mr. Yasuhiro Hagihara is an outside Director 
               prescribed in Paragraph 7-2, Section 2, Article 
               188 of the Commercial Code.
          2.   Messrs. Kazutaka Kubota, Kaoru Matsumoto and 
               Ryoichi Ohno are outside Corporate Auditors 
               prescribed in Section 1, Article 18 of 
               the "Law Concerning Special Exceptions to the 
               Commercial Code Concerning Audit, etc. of 
               KabushikiKaisha".
          3.   The name of the law firm "Squire Sanders & 
               Dempsey L.L.P. (Gaikokuhou Jimu Bengoshi 
               Jimusho)" where Mr. Yasuhiro Hagihara,
               Director of the Company, serves as Partner, 
               changed its name to "Squire Sanders 
               (Gaikokuho Kyodo Jigyo Horitsu Jimusho)" 
               as of April 1, 2005.
          4.   Changes in Directors and Corporate Auditors 
               during the fiscal year under review are as 
               follows:

(Assumption of office of Director and Corporate Auditor)

Position             Name                Remarks

Director             Takehiro Kamigama   Assumed on June 
                                         29, 2004
Corporate Auditor    Ryoichi Ohno        Assumed on June 
                                         29, 2004

(Retirement of Director and Corporate Auditor)

Position             Name                Remarks

Director             Hirokazu Nakanishi  Retired on June 
                                         29, 2004
Corporate Auditor    Osamu Nakamoto      Retired on June 
                                         29, 2004

     
(9)  Remunerations for Independent Certified Public Accountants

                                                         (Yen  
                                                         millions)
                         Item                            Amounts 
                                                         payable
     
1.   The aggregate amount of remunerations payable       170
to independent certified public accountants by the
Company and its subsidiaries:
     
2.   Out of the aggregate amount stated in 1             143
above, the amount of remunerations payable to
independent certified public accountants by the Company
and its subsidiaries in consideration of the duties
specified in Article 2, Section 1 of the Certified
Public Accountants Law of Japan (duties of audit
certification):
     
3.   Out of the aggregate amount stated in 2             94
above, the amount of remunerations payable to
independent certified public accountants by the Company:
          
(Note)    The amount of remunerations for auditing pursuant to 
          the Law Concerning Special Exceptions to the Commercial 
          Code concerning Audit, etc. of Joint-Stock Corporations 
          (Kabushiki Kaisha) and the amount of remunerations 
          pursuant to the Securities and Exchange Law are not 
          divided in the Auditing Agreement, which was concluded 
          between the Company and the independent public 
          accountants.  Therefore, the amount stated in 3 above 
          represents the total amount of the remunerations 
          paid by the Company.
     
(10) Stock Acquisition Rights with Specially Favorable Terms 
     and Conditions Issued to Persons other than Stockholders 
     During the Fiscal Year Under Review

     On August 6, 2004, the stock acquisition rights were issued 
     as stock option scheme pursuant to the resolution of the 
     Ordinary General Meeting of Stockholders held on June 29, 
     2004 and the approval of the meeting of the Board of 
     Directors held on July 29, 2004.
          
     (1)  Total number of stock acquisition rights issued:
               2,343 shares (100 shares per one stock 
               acquisition right)

     (2)  Class and number of shares to be granted for stock 
          acquisition rights:
               234,300 shares of common stock

     (3)  Issue price of stock acquisition rights:
               Free of charge

     (4)  Amounts to be paid upon the exercise of each stock 
          acquisition right:
               Yen 814,700 (Yen 8,147 per share)

     (5)  Exercise period of stock acquisition rights:
               From August 1, 2006 to July 31, 2010
          
     (6)  Conditions of exercise of stock acquisition rights:
               Partial exercise of stock acquisition rights 
               may not be permitted.
          
     (7)  Events and conditions of cancellation of stock acquisition 
          rights:
          (a)  If a proposal for approval of a merger agreement, 
               where the Company is the dissolving company, is 
               approved at a meeting of stockholders of the Company,
               or if a proposal for approval of a stock exchange 
               agreement or a proposal for share transfer under 
               which the Company becomes a wholly owned subsidiary 
               of another company, is approved at a meeting of 
               stockholders of the Company, stock acquisition 
               rights may be cancelled without any charge.
          (b)  In the event that the Company acquires and 
               holds stock acquisition rights, it may, at any 
               time, cancel without any charge any and all of 
               such stock acquisition rights.

     (8)  Restriction on transfer of stock acquisition rights:

               The transfer of stock acquisition rights requires 
               the approval of the Board of Directors.

     (9)  Contents of specially favorable terms and conditions:

               Stock acquisition rights have been issued free 
               of charge to Directors, Corporate Officers and 
               key employees of the Company and directors, 
               officers and key employees of associated 
               companies.
          
     (10) Name and number of stock acquisition rights allotted:
          (Directors of the Company)

     Name                    Number of stock acquisition
                             rights

Hajime Sawabe                187
Jiro Iwasaki                 99
Shinji Yoko                  92
Takeshi Nomura               92
Mitsuaki Konno               52
Yasuhiro Hagihara            10
Takehiro Kamigama            137
Total 7 Directors            669

          (Corporate Officers of the Company)

Name                          Number of stock acquisition
                              rights

Kiyoshi Ito                   129
Hirokazu Nakanishi            92
Katsuhiro Fujino              52
Takeshi Ohwada                52
Kunihiro Fukushima            45
Yukio Hirokawa                45
Masatoshi Shikanai            45
Yukio Harada                  45
Michinori Katayama            52
Kenryo Namba                  45
Takaya Ishigaki               59
Minoru Takahashi              52
Seiji Enami                   45
Raymond Leung                 10
Total 14 Officers             768

          (Key employees of the Company, Directors and key 
          employees of associated companies (Top 10))

Name               Number of stock  Note
                   acquisition
                   rights

Hiroshi Ikejima    10               Key employee of the Company
NG. Wai. Hong      10               Director of associated company
Koichi Nakano      8                Key employee of the Company
Masao Ishihara     8                Key employee of the Company
Ryohei Tatsuta     8                Key employee of the Company
Shiro Nomi         8                Key employee of the Company
Noboru Hara        8                Key employee of the Company
Kenichi Hiruma     8                Key employee of the Company
Toshinobu Shiokawa 8                Key employee of the Company
Shinya Yoshihara   8                Key employee of the Company

(Breakdown of total number of stock acquisition rights, which 
were granted to Corporate Officers, key employees of the Company, 
Directors and key employees of associated companies)

Classification     Number of stock  Type and number of Total number
                   acquisition      shares issued upon of Grantees
                   rights           exercise of stock
                                    acquisition rights

Corporate Officers 768              Common stock       14
of the Company                      76,800

Key employee       878              Common stock       162
                                    87,800

Directors of       23               Common stock       3
associated
companies                           2,300

Key employee of    5                Common stock       1
associated
companies                           500

(11)  Any events materially affecting the conditions of TDK Group 
occurred after the settlement of accounts.

            None.

Supplementary Information  (2)

                           Consolidated BALANCE SHEET
                  (prepared in accordance with the U.S. GAAP)

                             (As of March 31, 2005)

Item                    Amount    Item                    Amount
(ASSETS)                (Millions (LIABILITIES)           (Millions 
                        of                                of
                        yen)                              yen)

Current assets          510,291   Current liabilities     118,897
Cash and cash           251,508   Short-term debt         103
equivalents
Marketable securities   1,609     Trade payables          62,092
Net trade receivables   147,999   Accrued expenses        42,636
Inventories                       Income taxes payables   8,667
Other current assets    74,924    Other current           5,399
                                  liabilities
Noncurrent assets                 Noncurrent liabilities  15,246
Investments in          34,251    Long-term debt,         81
securities                        excluding current
                                  installments
Net property, plant and 279,729   Retirement and          11,170
equipment                         severance benefits
Goodwill and other      22,698    Deferred income taxes   751
intangible assets
Other assets                      Other noncurrent        3,244
                                  liabilities
                        216,969   (Total liabilities)     134,143
                                  Minority interests      5,162
                        22,457    (STOCKHOLDERS' EQUITY)  32,641
                        17,605    Common stock            63,051
                                  Additional paid-in      16,918
                                  capital
                                  Legal reserve           597,205
                                  Retained earnings       - 51,657
                                  Accumulated other       - 7,443
                                  comprehensive income
                                  (loss)
                                  Treasury stock          650,715
                                  (Total stockholders'
                                  equity)
Total assets:           790,020   Total liabilities and   790,020
                                  stockholders' equity:
          
(Notes)   1. Amounts less than Yen 0.5 million have been rounded 
             downward and amounts not less than Yen 0.5 million 
             have been rounded upward.
          2. Principal Accounting Principles, etc. are stated 
             separately.


Supplementary Information  (3)

                        Consolidated STATEMENT OF INCOME
                  (prepared in accordance with the U.S. GAAP)

                              From:  April l, 2004
                              To:  March 31, 2005

Item                                                 Amount
Net sales                                            (Millions 
                                                     of yen)

Cost of sales                                        657,853
Gross profit                                         484,323
Selling, general and administrative expenses         173,530
Transfer to the government of substitute potion of   119,886
the Employees' Pension Fund
Subsidy from the government
Loss on settlement                                   - 33,533
Operating income                                     27,347
Other income (deductions)                            59,830
Interest and dividend income
Interest expense                                     1,692
Foreign exchange gain (loss)                         - 324
Other - net                                          - 856
Total other income (deductions)                      1,730
Income from continuing operations before income      2,242
taxes
Income taxes                                         62,072
Income before minority interests                     12,980
Minority interests                                   49,092
Income from continuing operations                    479
Loss from discontinued operations, net of taxes      48,613
Income from continuing operations                    3,665
Net income                                           44,948
               
(Notes)   1.   Any amount arising from the discontinued 
               business during the 109th fiscal year in 
               accordance with the Statement of Financial 
               Accounting Standards ("SFAS") No.144, "Accounting 
               for the Impairment of Long-Lived Assets" is 
               stated above.
          2.   Amounts less than Yen 0.5 million have been 
               rounded downward and amounts not less than 
               Yen 0.5 million have been rounded upward.
          3.   Principal Accounting Principles, etc. are stated 
               separately.

(Separate Note)

(Basic Matters for Preparation of Consolidated statutory reports)
     
1.   Significant Accounting
     (1)  Standards for preparation of consolidated statutory 
          reports:
          
          The consolidated statutory report including consolidated 
          balance sheets and consolidated statements of income has 
          been prepared on the basis of accounting principles 
          generally accepted in the United States of America ("U.S. 
          GAAP"), in compliance with Article 179, Section 1 of 
          the Commercial Code Enforcement Regulations. However, 
          in compliance with the article, certain disclosure that 
          is required on the basis of U.S. GAAP is omitted.

     (2)  Valuation standards and methods of inventories are as 
          follows:

          Products and work in progress are valued at the lower of 
          cost using a periodic average method, and raw materials 
          and supplies are value at the lower of cost using a 
          monthly moving average cost method.

     (3)  Valuation standards and methods of securities are as 
          follows:

          Statement of Financial Accounting Standards ("SFAS") 
          No.115, "Accounting for Certain Investments in Debt and 
          Equity Securities" is adopted.

           Held-to-maturity securities:
               They are carried at amortized cost.
           Securities for sale:
               They are carried at fair value as of the balance 
               sheet date with changes in unrealized holding gain or 
               loss, net of the applicable income taxes, included 
               directly in shareholders' equity.  The cost of 
               securities sold is primarily calculated by the moving 
               average method.
          
     (4)  Method of depreciation of cost of fixed assets is as 
          follows:

          Property, plant and equipment:
               Depreciation of property, plant and equipment of the 
               Company, its domestic consolidated subsidiaries and 
               certain overseas consolidated subsidiaries is 
               principally computed by the declining-balance method, 
               and by the straight-line method for assets of other 
               foreign subsidiaries.

         Intangible fixed assets:
               Depreciation of intangible fixed assets is carried 
               at the straight-line method. (Provided, however, 
               that, in respect of some intangible assets, useful 
               lives of which cannot be specified under SFAS No.142 
               "Goodwill and Other Intangible Assets", they are no 
               longer amortized but instead is tested for impairment at
               least annually.)
     
     (5)  Accounting basis of principal allowances:

          Allowance for doubtful receivables:
               In order to prepare for losses from bad debts, it is 
               stated an estimated incollectible amount, in 
               consideration of the past experience for bad debt 
               ratio with respect to doubtful receivables in general, 
               and the individual estimate on possibility of 
               collection with respect to doubtful receivables.

          Retirement and severance benefits:
               It is stated an amount calculated by the fair value 
               of benefit obligations and plan assets as of 
               March 31, 2005 for the future payment of retirement 
               and severance benefits payable to employees, in 
               accordance with SFAS No. 87, "Employers' Accounting 
               for Pensions".  If the aggregate benefit obligations 
               (that is, the obligations calculated by retirement 
               and severance benefits after deducted the future 
               rise in salaries) are lower than the fair value of 
               the plan assets, it is additionally stated the 
               minimum pension liability adjustments, taking into 
               account the amounts due to the tax effect.

               Unrealized prior service costs of employees are 
               amortized in the year in which such costs occurred 
               using the straight-line method over certain periods 
               within the estimated average remaining service 
               years of employees.

               With respect to unrealized actuarial net losses, 
               the certain part (equivalent to 10% of the fair 
               value of retirement and severance benefits or 
               plan assets whichever is the higher basis) are 
               amortized using the straight-line method over 
               certain periods within the estimated average 
               remaining service years of employees.
          
     (6)  Method of accounting consumption tax, etc.:
               No consumption tax, etc. is included in the 
               statutory reports.
          
     (7)  Goodwill:

               Under SFAS No.142, "Goodwill and Other 
               Intangible Assets"  goodwill is no longer 
               amortized but instead is tested for 
               impairment at least annually.

(Notes with respect to Balance Sheet)
     
1.   Allowance for doubtful receivables:                 Yen 2,560 
                                                         million
     
2.   Accumulated amount of depreciation of property, 
     plant and equipment:                                Yen 445,551 
                                                         million
3.   Other comprehensive income includes changes in 
     foreign currency translation adjustments, minimum 
     pension liability adjustments and net unrealized 
     gains (losses) on securities.
     
4.   Assets pledged or collateral:
          Securities                                     Yen 699 
                                                         million
          Investment securities                          Yen 994 
                                                         million
5.   Contingent liabilities including guaranteed 
     liabilities:
          Outstanding guaranteed liabilities             Yen 6,296 
                                                         million
6.   Other matter:

The Company has been subject to the tax audit by the Tokyo Regional 
Taxation Bureau with respect to transfer pricing between the Company 
and its overseas subsidiaries during the five year periods between 
the 103rd fiscal year (from April 1, 1998 to March 31, 1999) and the 
107th fiscal year (from April 1, 2002 to March 31, 2003).  At the 
present stage, the Company has not yet received any final and 
conclusive results.  Therefore, any income tax payable that may be
arising therefrom is not stated in the accompanying the consolidated 
statutory report.


(Notes with respect to Statement of Income)

     Net income per share:                               Yen 339.76
     Diluted net income per share:                       Yen 339.55

(Important subsequent events)

          Not applicable.

(Scope of consolidation)

Consolidated subsidiaries, associated companies accounted for by 
the equity method:
     
1.   Number of consolidated subsidiaries:      71
     Name of major consolidated subsidiaries:
                                               TDK U.S.A. Corporation
                                               TDK Europe S.A.
                                               SAE Magnetics 
                                               (Hong Kong) Limited
                                               TDK-MCC Corporation
     
2.   Number of associated companies accounted 
     for by the equity method:                 6
     Name of major associated companies accounted 
     for by the equity method:
                                               BT Magnet Technologie 
                                               GmbH
                                               Semiconductor Energy 
                                               Laboratory Co., Ltd.
                                               Tokyo Magnetic 
                                               Printing Co., Ltd.

Supplementary Information (4)

                CERTIFIED COPY OF PUBLIC ACCOUNTANTS' REPORT
                      for Consolidated statutory reports

   (English Translation of the Auditors' Report Originally 
                              Issued in Japanese
                                   Language)

                          Independent Auditors' Report

                                             May 23, 2005
To:     The Board of Directors of TDK Corporation

                                             KPMG AZSA & CO.,
                                             Seiichi Sasa (Seal)
                                               Designated and 
                                               Engagement Partner
                                               Certified Public 
                                               Accountant

                                             Hideaki Koyama (Seal)
                                               Designated and 
                                               Engagement Partner
                                               Certified Public 
                                               Accountant

     We have audited the consolidated statutory report, that is 
the consolidated balance sheet and the consolidated statement of 
income, of TDK Corporation for the 109th business year from April 
1, 2004 to March 31, 2005 in accordance with Article 19-2(3) of 
the "Law for Special Exceptions to the Commercial Code Concerning 
Audit, etc. of Kabushiki Kaisha".  The consolidated statutory report 
is the responsibility of the Company's management.  Our 
responsibility is to express an opinion on the consolidated 
statutory report based on our audit as independent auditors.

We conducted our audit in accordance with auditing standards 
generally accepted in Japan. Those auditing standards require us to 
obtain reasonable assurance about whether the consolidated 
statutory report is free of material misstatement.  An audit is 
performed on a test basis, and includes assessing the
accounting principles used, the method of their application and 
estimates made by management, as well as evaluating the overall 
presentation of the consolidated statutory report.  We believe that 
our audit provides a reasonable basis for our opinion.  Our audit 
procedures also include those considered necessary for the 
Company's consolidated subsidiaries .

As a result of the audit, in our opinion, the consolidated 
statutory report referred to above presents fairy  the 
consolidated financial position of TDK Corporation and Company's 
consolidated subsidiaries , and the consolidated results of their 
operations  in conformity with related laws and regulations and
the Articles of Incorporation of the Company.

Our firm and engagement partners have no interest in the Company 
which should be disclosed pursuant to the provisions of the 
Certified Public Accountants Law of Japan.


- End -

Supplementary Information (5)

            CERTIFIED COPY OF REPORT OF BOARD OF CORPORATE AUDITORS
                       For Consolidated statutory reports
                AUDIT REPORT for Consolidated statutory reports

     This Board of Corporate Auditors prepared and report the 
following audit report of the consolidated statutory reports
(the consolidated balance sheet and the consolidated statement 
of income) during the 109th fiscal year from April 1, 2004 to 
March 31, 2005, upon deliberation, based on the reports
from each Corporate Auditor regarding the method and the 
result of audit.
     
1.   Summary of method of audit:

     Each Corporate Auditor, subject to, inter alia, the audit 
policy and the business assignment, etc. set up by the Board of 
Corporate Auditors and the duties assigned to each Corporate 
Auditor, audited the consolidated statutory reports upon 
receipt of reports and explanations from Directors and the
Certified Public Accountants regarding the consolidated 
statutory reports

2.   Result of audit:

     We confirm that the method and results of the audit 
carried out by KPMG AZSA & CO., Independent Public 
Accountants, are appropriate.

May 24, 2005

                             Board of Corporate Auditors of
                             TDK Corporation

                                Corporate Auditor (full-time)
                                  Masaaki Miyoshi      (Seal)
                                Corporate Auditor (full-time)
                                  Takuma Otsuka        (Seal)
                                Corporate Auditor
                                  Kazutaka Kubota      (Seal)
                                Corporate Auditor
                                  Kaoru Matsumoto      (Seal)
                                Corporate Auditor
                                  Ryoichi Ohno         (Seal)
          
(Note)    Messrs. Kazutaka Kubota, Kaoru Matsumoto and Ryoichi 
          Ohno are outside Corporate Auditors prescribed in 
          Section 1, Article 18 of the Law Concerning Special 
          Exceptions to the Commercial Code Concerning Audit, 
          etc. of Kabushiki Kaisha.

Supplementary Information (6)

                         Non-Consolidated BALANCE SHEET

                             (As of March 31, 2005)

Item                     Amount     Item                     Amount
(ASSETS)                 (Millions  (LIABILITIES)            (Millions 
                         of                                  of
                         yen)                                yen)

Current Assets           272,300     Current Liabilities      76,436
Cash and deposits with   64,882      Trade payables accounts  37,458
banks
Trade receivables -      3,591       Accounts payable         5,553
notes
Trade receivables -      78,498      Accrued income taxes     8,166
accounts
Marketable securities    25,697      Accrued expenses         11,032
Products and merchandise 9,038       Deposits received        13,474
Raw materials and        4,883       Other current            751
supplies                             liabilities
Work in process          8,840       Noncurrent Liabilities   14,959
Advance payments         6,871       Retirement and severance 14,706
                                     benefits
Deferred tax assets      4,025       Directors' and          253
                                     Corporate Auditors'
                                     retirement allowance
Short-term loans         55,982      (Total Liabilities)      91,396
receivables
Other current assets     10,161      (STOCKHOLDERS' EQUITY)   32,641
Allowance for doubtful   - 171       Common Stock             59,256
receivables
Noncurrent Assets        266,576     Capital Surplus          59,256
Net property, plant and  121,248     Additional paid-in       361,166
equipment                            capital
Buildings                37,362      Legal Surplus            8,160
Structures               1,805       Legal reserve            307,345
Machinery and equipment  56,731      Voluntary reserve        807
Vehicles, tools,         3,566       Special depreciation     306,053
furniture and fixtures               reserve
Land                     13,777      General reserve          484
Construction in progress 8,004       Reserve for deferred     45,660
                                     income taxes
Intangible fixed assets  9,233       Unappropriated retained  1,858
                                     earnings for the year
Patent rights            6,510       Unrealized holding gains - 7,443
                                     (losses) on investments
                                     in shares
Software                 2,462       Treasury stock           447,480
Other intangible fixed   260         Total Stockholders'
assets                               Equity
Investments and advances 136,094
Investments in           12,944
securities
Shares of subsidiaries   94,883
Investment in            8,888
subsidiaries
Long-term loans          151
receivable
Long-term prepaid        3,171
expenses
Advance payment of       3,644
pension expenses
Long-term deferred tax   10,851
assets
Other investments        2,149
Allowance for doubtful   - 589
receivables
Total Assets:            538,877     Total Liabilities and    538,877
                                     Stockholders' Equity:
               
(Notes)   1.   Amounts less than Yen 1 million have been rounded 
               downward.
          2.   Principal Accounting Principles, etc. are stated 
               separately.



Supplementary Information (7)

                      Non-Consolidated STATEMENT OF INCOME

                              From:  April l, 2004
                              To:  March 31, 2005

Item                                                 Amount
CURRENT INCOME AND LOSS                              (Millions 
                                                     of yen)

Operating Income and Loss                            328,452
Operating income                                     328,452
Net sales                                            319,798
Operating expenses                                   258,007
Cost of sales                                         61,791
Selling, general and administrative expenses           8,653
Operating income                                      31,436
Non-operating Income and Loss                         12,898
Non-operating income                                   8,706
Interest and dividend income                           8,431
Technology commission                                  1,399
Rental received                                        9,539
Other non-operating income                                42
Non-operating expenses                                   655
Interest paid                                          7,605
Exchange loss                                          1,236
Depreciation of leased assets                         30,550
Other non-operating expenses
Current Income                                        30,628
EXTRAORDINARY PROFIT AND LOSS                             53
Extraordinary Profit                                  30,225
Gain on sales of fixed assets                            349
Gain on transfer to the government of the              1,334
substituted portion of Employees' Pension Plan
Other profit                                           1,309
Extraordinary Loss                                        24
Loss on disposal of fixed assets
Loss on devaluation of investment securities          59,843
Income before income taxes                            10,942
Income taxes current                                   9,388
Income taxes - deferred                               39,513
Net income                                            10,252
Retained earnings brought forward from the preceding     139
year
Loss on disposition of treasury stock                  3,966
Interim dividends                                     45,660
Unappropriated retained earnings for the year
               
(Notes)   1.   Amounts less than Yen 1 million have been 
               rounded downward.
          2.   Principal Accounting Principles, etc. are 
               stated separately.

(Separate notes)

                        Principal Accounting Principles

     The principal accounting principles, procedures and 
methods of representation adopted for the preparation of 
the Balance Sheet and the Statement of Income are as 
follows:
     
1.   Valuation standards and methods of securities are as 
follows:
               
          (1)  Shares of subsidiaries and affiliates:
               They are valued at cost using a moving 
               average cost method.
               
          (2)  Other securities:

               Marketable securities:
                    Market price method on the fair market price 
                    as of the end of fiscal year (any balance 
                    resulting from valuation of securities shall 
                    directly be entered into stockholders' 
                    equity, while any cost of sales of marketable 
                    securities shall be calculated using a moving 
                    average cost method.)

               Non-marketable securities:
                    They are valued at cost using a moving average 
                    cost method.
     
2.   Valuation standards and methods of derivatives are as follows:
               They are valued at market price.

3.   Valuation standards and methods of inventories are as follows:
               
          (1)  Products and work in progress:
               They are valued at the lower of cost using a 
               periodic average method.
               
          (2)  Raw materials and supplies:
               They are value at the lower of cost using a monthly 
               moving average cost method.

4.   Method of depreciation of cost of fixed assets:
               
          (1)  Property, plant and equipment:
               Depreciation of buildings (other than facilities 
               attaching to the buildings) is principally 
               computed using the straight-line method, and property 
               other than buildings is principally computed 
               using the declining balance method.
               The estimated useful lives of assets are as follows:
                    Buildings:                    3 to 50 years
                    Machine and equipment         4 to 22 years
               
          (2)  Intangible fixed assets:
               Depreciation of intangible fixed assets is computed 
               using the straight-line method.

               Software for the in-house use is computed using the 
               straight-line method based on the utilizable period 
               (5 years) within the Company.

5.   Accounting basis of principal allowances:
               
          (1)  Allowance for doubtful receivables:
               In order to prepare for losses from bad debts, it is 
               stated an estimated incollectible amount, in 
               consideration of the past experience for bad debt 
               ratio with respect to doubtful 
               receivables in general, and the individual estimate 
               on possibility of collection with respect to doubtful 
               receivables.
               
          (2)  Retirement and severance benefits (Prepaid pension 
               costs):
               It is stated estimated amounts of benefit obligations 
               and plan assets as of March 31, 2005 for the future 
               payment of retirement and severance benefits 
               payable to employees (or prepaid pension costs).
               Actuarial gains and losses are amortized from the 
               next year following the year in which such gains and 
               losses occurred using the straight-line method over 
               certain periods within the estimated average 
               remaining service years of employees.  Prior service 
               costs of employees are amortized in the year in 
               which such costs occurred using the straight-line 
               method over certain periods within the estimated 
               average remaining service years of employees.

          (Additional information)
               Due to the enforcement of the Defined Benefit 
               Corporate Pension Law, the Company was authorized 
               by the Minister of Health, Labor and Welfare on 
               October 1, 2004 to transfer to the government of 
               the substitutional portion of the benefit 
               obligation, and paid the minimum pension liability 
               on January 31, 2005.  Accordingly, a gain of 
               Yen 30,225 million arising from the substitutional 
               portion of the benefit obligation that transferred 
               to the government during the fiscal year under 
               review is stated as an extra ordinary profit.
               
          (3)  Directors' and Corporate Auditors' retirement 
               allowance:
               In order to prepare for future payment of 
               retirement grants for Directors and Corporate 
               Auditors to resign, it is stated an 
               amount to be required at the end of the fiscal 
               year concerned in accordance with the internal 
               regulations of the Company.  
               Provided, however, that the reserve for 
               Directors' retirement allowance to be accrued 
               following the date after the date of the 
               106th Ordinary General Meeting of Stockholders 
               has been suspended upon resolutions of the 
               meeting of the Board of Directors.  
               Directors' prior retirement grants shall be 
               paid when a Director resigns upon resolution 
               of the General Meeting of Stockholders.
               This is the allowance as prescribed in Article 
               43 of the Commercial Code Enforcement Regulations.

6.   Method of accounting for lease transactions:
          Finance leases, except for those in which ownership is 
          deemed to be transferred to the lessee, are accounted 
          for as operating leases, that is, the rental of 
          property.

7.   Method of accounting consumption tax, etc.:
          No consumption tax, etc. is included in the 
          statutory reports.

(Notes with respect to Balance Sheet)
     
1.   Pecuniary credits and debts to subsidiaries:
          (1)     Short-term credits          Yen 67,768 million
          (2)     Long-term credits           Yen 110 million
          (3)     Short-term debts            Yen 25,644 million

2.   In addition to the fixed assets stated in the balance 
     sheet, there are computers and other related machinery 
     and equipment as principal assets used pursuant to
     lease contracts.

3.   There is no pecuniary credit or debt to Directors or 
     Corporate Auditors of the Company.

4.   Assets pledged or collateral:
          Securities                          Yen 699 million
          Investment securities               Yen 994 million

5.   Contingent liabilities including guaranteed liabilities:
          Outstanding guaranteed liabilities  Yen 6,235 million

6.   Accumulated amount of depreciation 
          of property, plant and equipment:   Yen 270,819 million

7.   Net assets pursuant to Article 124, paragraph 3 of 
     the Commercial Code Enforcement Regulations: Yen 1,415 million

(Notes with respect to Statement of Income)

1.   Net sales to subsidiaries:               Yen 195,950 million
2.   Purchases from subsidiaries:             Yen 144,949 million
3.   Non-operating transactions with 
     subsidiaries:                            Yen  31,192 million
4.   Net income per share                     Yen 297.93
      (While net income stated in the accompanying statement of 
      income is Yen 39,513 million, net income concerned with 
      common stock which was used for the calculation basis of the 
      net income per share for the fiscal year under review is 
      Yen 39,413 million.
      The difference arises from the proposed payment of 
      directors' bonuses.  The average number of shares of common 
      stock issued during the fiscal year under review, which was 
      used for the calculation basis of the net income 
      per share, totals 132,292 thousand shares.

(Notes with respect to Retirement and Severance Benefits)

1.  Components of retirement and severance benefits:

                                           109th Business year
                                           (As of March 31, 2005)

(1)  Retirement and severance benefit      (Yen  million)
     obligation:                           - 164,031
(2)  Plan assets:                          137,241
(3)  Unfunded obligations for benefit      - 26,789
     obligation (1) + (2):
(4)  Unrecognized actuarial loss           38,543
     (gain)
(5)  Unrecognized prior service costs      - 22,816
(6)  Prepaid pension costs                 3,644
(7)  Accrued retirement and severance      - 14,706
     benefits
     (3) + (4) + (5) (6):

2.  Components of retirement benefit costs:

                                           109th Business year
                                           (April 1, 2004 -
                                           March 31, 2005)

Retirement benefit costs                   (Yen  million)
                                           8,940
(1)  Service cost                          5,823
(2)  Interest cost                         3,758
(3)  Expected return on plan assets        - 2,591
(4)  Amortization of prior service         - 2,070
     costs
(5)  Amortization of actuarial loss        3,573
     (gain)
(6)  Extra benefits paid:                  446
     
3.   Calculation basis of for retirement and severance benefits 
obligations:

                                           109th Business year
                                           (As of March 31, 2005)
     
(1)  Discount rates:                       2.00%
(2)  Expected rates of return on           2.00%
     investment:
(3)  Distribution method of estimated      Period fixed 
     amount of retirement and severance    amount standard
     benefits during the period:
(4)  Amortization of prior service         Average remaining 
     obligations                           years of service 
                                           of the employees 
                                           when it occurs

(5)  Years to amortize actuarial gain      Average remaining 
     /loss:                                years of
                                           service of the 
                                           employees when
                                           it occurs


Supplementary Information (8)


                PROPOSAL FOR APPROPRIATION OF Retained EARNINGS

Appropriation of Unappropriated Retained Earnings for the Fiscal 
Year ended March 31, 2005

Unappropriated retained earnings for the year  (yen)
                                               45,660,555,459
Reversal of general reserve
Reversal of special depreciation reserve       284,026,401
Total                                          45,944,581,860

We propose that the above income will be disposed as follows:

Appropriated retained earnings
Dividends                                      5,289,783,480
(Yen 40 per share)
Directors' bonuses                            99,590,000
General reserve
Special depreciation reserve                   160,393,000
Total                                          5,549,766,480
Balance Carried Forward                        40,394,815,380
                              
(Notes)   1.   Dividends are calculated excluding treasury 
               stock of 945,072 shares.
          2.   Interim dividends (Yen 30 per share) in the 
               aggregate amount of Yen 3,966,092,700 were 
               paid on December 6, 2004.
          3.   A special depreciation reserve and advanced 
               depreciation reserve are reversed or set up 
               in accordance with the Special Taxation 
               Measurement Law.

Supplementary Information (9)

                  CERTIFIED COPY OF PUBLIC ACCOUNTANTS' REPORT

   (English Translation of the Auditors' Report Originally 
                     Issued in Japanese Language)

                          Independent Auditors' Report


                                                   May 2, 2005
To:  The Board of Directors of TDK Corporation
                                KPMG AZSA & Co.,
                                  Seiichi Sasa (Seal)
                                    Designated and Engagement Partner
                                    Certified Public Accountant

                                  Hideaki Koyama (Seal)
                                    Designated and Engagement Partner
                                    Certified Public Accountant

            We have audited the statutory report, that is the 
balance sheet, the statement of income, the business report 
(limited to accounting matters) and the proposal for 
appropriation of unappropriated retained earnings , and its
supporting schedules (limited to accounting matters) of TDK 
Corporation for the 109th business year from April 1, 2004 
to March 31, 2005 in accordance with Article 2(1) of the 
"Law for Special Exceptions to the Commercial Code
Concerning Audit, etc. of Kabushiki Kaisha".  With 
respect to the aforementioned business report and 
supporting schedules, our audit was limited to those matters
derived from the accounting books and records.  The 
statutory report and supporting schedules are the 
responsibility of the Company's management.  Our responsibility 
is to express an opinion on the statutory report and supporting
schedules based on our audit as independent auditors.

We conducted our audit in accordance with auditing standards 
generally accepted in Japan.  Those auditing standards require 
us to obtain reasonable assurance about whether the statutory 
report and supporting schedules are free of material
misstatement.  An audit is performed on a test basis, and 
includes assessing the accounting principles used, the 
method of their application and estimates made by management, 
as well as evaluating the overall presentation of the statutory
report and supporting schedules.  We believe that our audit 
provides a reasonable basis for our opinion.  Our audit 
procedures also include those considered necessary for the 
Company's subsidiaries.

As a result of the audit, our opinion is as follows:
(1)  The balance sheet and the statement of income present 
     fairly the financial position and the results of 
     operations of the Company in conformity with related 
     laws and regulations and the Articles of Incorporation of the 
     Company.
(2)  The business report (limited to accounting matters) 
     presents fairly the status of the Company in conformity 
     with related laws and regulations and the Articles of 
     Incorporation of the Company.
(3)  The proposal for appropriation of  unappropriated 
     retained earnings has been prepared in conformity with 
     related laws and regulations and the Articles of 
     Incorporation of the Company.
(4)  With respect to the supporting schedules (limited to 
     accounting matters) there are no items to be noted 
     that are not in conformity with the provisions of the 
     Commercial Code.

Our firm and engagement partners have no interest in the 
Company which should be disclosed pursuant to the 
provisions of the Certified Public Accountants Law of
Japan.


- End -

Supplementary Information  (10)

        CERTIFIED COPY OF REPORT OF BOARD OF CORPORATE AUDITORS

                                AUDIT REPORT

         This Board of Corporate Auditors prepared and report 
upon the following audit report regarding the performance of 
duties of the Directors of the Company during the 109th fiscal 
year from April 1, 2004 to March 31, 2005, upon deliberation, 
based on the reports from each Corporate Auditor regarding the
method and the result of audit.
     
1.   Summary of method of audit:

         Each Corporate Auditor, subject to, inter alia, the 
audit policy and the business assignment, etc. set up by the 
Board of Corporate Auditors and the duties assigned to each 
Corporate Auditor, has attended meetings of the Board of
Directors and other meetings as deemed important, heard 
the performance of the duties, perused the documents whereby 
the important decisions were made, and examined business and 
financial conditions at the head office and the principal
offices.  In addition, we requested reports on business from 
the Company's subsidiaries.  We received from the Independent 
Accountants reports on audit and examined the accounting 
statements and attached schedules.

         As for the transactions between Directors acting on 
their own behaves and the companies which businesses are 
competitive to the Company, transactions between Directors 
and the Company in which interests in both parties are
contradictory, the provision, free of charge, of profits 
conducted by the Company, transactions not in the ordinary 
course of business between its subsidiaries and the Company 
or between its stockholders and the Company and acquisition 
and disposal of its own shares and the like, we each examined 
such transactions in detail by receiving reports from the 
Directors, as necessary, in addition to the method of audit 
mentioned above.

2.   Result of audit:
          
     (1)  The method and results of auditing carried out by 
          KPMG AZSA & Co., Independent Public Accountants, 
          are appropriate.
     (2)  The Business Report fairly sets forth the situation 
          of the Company in accordance with laws and ordinances 
          and the Articles of Incorporation.
     (3)  With respect to the item concerning the proposal for 
          appropriation of retained earnings, nothing unusual 
          is to be pointed out in accordance with the financial 
          condition of the Company and other circumstances.
     (4)  The attached schedules fairly set forth the matters 
          to be stated and nothing unusual is to be pointed out.
     (5)  With respect to the performance of their duties by the 
          Directors including the duties regarding subsidiaries, 
          no illegal act nor any fact which is in violation of 
          the laws and ordinances and the Articles of 
          Incorporation is ascertainable.
          We confirm that there are no violations of obligation 
          by Directors,  such as transactions competitive to the 
          Company's business as prescribed in Article 133, 
          paragraph 1 of the Commercial Code 
          Enforcement Regulations.


May 6, 2005

                         Board of Corporate Auditors of
                         TDK Corporation

                          Corporate Auditor (full-time)
                           Masaaki Miyoshi      (Seal)
                          Corporate Auditor (full-time)
                           Takuma Otsuka        (Seal)
                          Corporate Auditor
                           Kazutaka Kubota      (Seal)
                          Corporate Auditor
                           Kaoru Matsumoto      (Seal)
                          Corporate Auditor
                           Ryoichi Ohno         (Seal)
          
(Note)    Messrs. Kazutaka Kubota, Kaoru Matsumoto and 
          Ryoichi Ohno are outside Corporate Auditors 
          prescribed in Section 1, Article 18 of the Law 
          Concerning Special Exceptions to the Commercial 
          Code Concerning Audit, etc. of Kabushiki Kaisha.


- End -
(Reference)

Tax Office Investigation on Transfer Price System

The Company has been subject to the tax audit by the Tokyo 
Regional Taxation Bureau with respect to transfer pricing 
between the Company and its overseas subsidiaries during 
the five year periods between the 103rd fiscal year (from
April 1, 1998 to March 31, 1999) and the 107th fiscal year 
(from April 1, 2002 to March 31, 2003).  At the present 
stage, the Company has not yet received any final and 
conclusive results and is not in a position to estimate 
the contingent income tax payable that the Company may 
incur as a result of the tax audit. Therefore, it was not 
possible to state any income tax payable in the accompanying 
the consolidated statutory report and the non-consolidated
statutory report for the 109th fiscal year (from April 1, 2004 
to March 31, 2005).

There is a statement that the Company has been subject to the 
tax audit for transfer pricing as the additional information 
of the consolidated statutory reports in the Public 
Accountants' Report.  This is due to the fact that the
tax audit for transfer pricing is likely to conclude in the 
near future, immediately after the Company received the audit 
reports for the non-consolidated statutory reports up to the 
present.  On the other hand, there is no statement concerning 
the tax audit in the Public Accountants' Report for
the non-consolidated statutory reports.

    Reference Documents Concerning the Exercise of Voting Rights
     
1.   Aggregate number of voting rights owned by all stockholders:
                                          1,321,727 voting rights
     
2.   Matters to be Resolved and Matters for Reference:
                    
     First Item:    Approval of Proposal for Appropriation of 
                    Retained Earnings for the 109th Fiscal Year

         The appropriation of retained earnings for the fiscal year 
under review is proposed as stated in Supplementary Information (8)
(in the page 32).

         The Company gives a priority to returning income to its 
stockholders as an important management issue.  The Company's 
fundamental dividend policy is to steadily increase the dividend 
taking into consideration the level of consolidated return on equity,
dividends on equity and business results, among other factors.  
Consequently, with respect to the proposed appropriation of
retained earnings as at the end of the fiscal year under review, 
it is proposed that the year-end dividend during the fiscal year 
under review be Yen 40.00 per share.  Together with the interim 
dividends of Yen 30.00 per share, which were paid in December 
6, 2004, the total dividends for the fiscal year under review will
be Yen 70.00 per share, a Yen 15.0 increase per share over the 
previous fiscal year.
                    
     Second Item:   Issuance of Stock Acquisition Rights as Stock 
                    Option Scheme for Stock-Linked Compensation Plan

         You are requested to approve the issuance of stock 
acquisition rights in accordance with the following terms and 
conditions, pursuant to Article 280-20 and Article 280-21 of the 
Commercial Code of Japan, in order to allow the Company to implement 
a stock option scheme for stock-linked compensation plan
for Directors and Corporate Officers of the Company.
     
1.   Reason for the issuance of stock acquisition rights with 
     specially  favorable terms and conditions to persons other 
     than stockholders:

     The Company intends to issue stock acquisition rights 
     without any charge to Directors and Corporate Officers as a 
     stock option scheme for stock-linked compensation plan in 
     accordance with the conditions of the issuance as 
     stated in 2 below.  The aim of the plan is to further raise 
     motivation and enhance morale to improve the business results 
     and the rise of stock price of the Company, by formulating a 
     system that the Directors and Corporate Officers will share 
     benefits and risks arising from the rise and fall of 
     stock price with its stockholders.
          
2.   Summary of the issuance of stock acquisition rights:
     (1)  Class and number of shares to be issued upon exercise of 
          stock acquisition rights:
            The maximum number shall be 41,000 shares of common 
            stock of the Company.
            In case of adjustment of the number of shares attached 
            to each stock acquisition rights (defined as below) in 
            accordance with (2) below, the number of shares to be 
            issued upon exercise of stock acquisition rights shall 
            be adjusted to a number obtained by multiplying the 
            number of shares attached to each stock acquisition 
            right after adjustment by the aggregate number of stock 
            acquisition rights.
          
     (2)  Aggregate number of stock acquisition rights to be issued:
            The maximum number shall be 410.

            The number of shares attached to one stock acquisition 
            right (hereinafter referred to as the "number of shares 
            attached") shall be 100 shares.  Provided, however, that 
            on or after the date on which stock acquisition rights 
            are issued (hereinafter referred to as the "issue date"), 
            in case the Company makes a stock split or 
            stock consolidation of shares of common stock, the 
            number of shares attached shall be adjusted proportional 
            to the percentages of such stock split or stock 
            consolidation of shares.
            In addition, in the case of any unavoidable event, such 
            as the Company's merger or corporate partition that 
            requires adjustments to be effected to the number of 
            shares attached, the number of shares shall be adjusted 
            to the reasonable extent, taking into account the 
            terms and conditions of the merger or corporate partition 
            or the like, and any number of share less than one share 
            arising out of such adjustment shall be disregarded.
          
     (3)  Issue price of stock acquisition rights:
            Free of charge
          
     (4)  Amounts to be paid for the exercise of each stock 
           acquisition right:
            Amounts to be paid for the exercise of each stock 
            acquisition right shall be 1 yen per share, 
            multiplied by the number of shares attached.
          
     (5)  Exercise period of stock acquisition rights:
            The exercise period shall be determined by the 
            Board of Directors and shall be within a period 
            from July 1, 2005 to June 30, 2025.
          
     (6)  Conditions of exercise of stock acquisition rights:
          (1)  A holder of stock acquisition rights may not 
               exercise the stock acquisition rights during July 1, 
               2005 to June 2008, except for the case stated in (2) 
               below, such holder may exercise the 
               stock acquisition rights on or after July 1, 2008.
          (2)  The holder of stock acquisition rights may only 
               exercise such rights within the specified period set 
               out in (a) or (b) below, in case of any event set out 
               in (a) or (b), respectively.
               a) In case the holder of stock acquisition rights 
                  loses the position as both Corporate Officer and 
                  employee (including full-time advisor and full-time 
                  counselor, but excluding part-time adviser and 
                  part-time counselor; the same shall be 
                  applicable hereinafter);

                    For three years from the date immediately 
                    following the date that such holder loses the 
                    position as both Corporate Officer and employee 
                    of the Company

               b) In case a proposal for a merger agreement where the 
                  Company will be dissolved, or a proposal for a 
                  stock exchange agreement or stock transfer agreement 
                  where the Company will become a wholly owned 
                  subsidiary is approved at the general meeting of 
                  shareholders of the Company;

                    During a 15 day-period commencing from the date 
                    immediately following the date when the proposal 
                    is approved

          (3)  In case that the holder of stock acquisition rights 
               loses the position as both Corporate Officer and 
               employee of the Company on or after July 1, 2008, 
               the holder may only exercise the rights for three 
               years on or after the date immediately following the 
               date when such holder loses the position as Corporate 
               Officer and Director, but not beyond the exercise 
               period of stock acquisition rights.

          (4)  Each stock acquisition right shall not be partially 
               exercised.

     (7)  Events and conditions of cancellation of stock 
          acquisition rights:
            If the holder of stock acquisition rights is unable to 
            exercise the stock acquisition rights, stock acquisition 
            rights may be cancelled without any charge.
          
     (8)  Restrictions on transfer of stock acquisition rights:
            Any transfer of stock acquisition rights shall be 
            subject to approval of the Board of Directors of the 
            Company.
     
3.   Summary of the allotment of stock acquisition rights:
       When granting stock acquisition rights to each grantee 
       (the "Grantee"), the Company shall enter into the "Granting 
       of Stock Acquisition Right Agreement" with each of the 
       Grantees, which shall provide for the additional conditions 
       deemed reasonable by the Board of Directors for the
       purpose of the issuance of stock acquisition rights.
               
Third Item:    Issuance of Stock Acquisition Rights as Stock Option 
               Scheme

You are requested to approve the issuance by the Company of stock 
acquisition rights in accordance with the following terms and 
conditions, pursuant to Article 280-20 and Article 280-21 of the 
Commercial Code of Japan, in order to grant such rights as a stock 
option to key employees of the Company and Directors and key 
employees of each of the associated companies.
     
1.   Reason for the issuance of stock acquisition rights with 
     specially favorable terms and conditions to persons other 
     than stockholders:

     In order to further raise motivation and enhance morale for 
     contributing to the improvement of consolidated business 
     results of the Company, improve business results of the 
     Company and associated companies and stockholder 
     values, stock acquisition rights shall be issued without 
     any charge to key employees of the Company and Directors 
     and key employees of each of the associated companies in 
     accordance with the conditions of the issuance as 
     stated in 2. below.
     
2.   Summary of the issuance of stock acquisition rights:
     (1)  Class and number of shares to be issued upon exercise 
          of stock acquisition rights:
            The maximum number shall be 119,000 shares of common 
            stock of the Company.
            In case of adjustment of the number of shares 
            attached to each stock acquisition rights (defined as 
            below) in accordance with (2) below, the number of 
            shares to be issued upon exercise of stock acquisition 
            rights shall be adjusted to a number obtained by 
            multiplying the number of shares attached to each 
            stock acquisition right after adjustment by the 
            aggregate number of stock acquisition rights.

     (2)  Aggregate number of stock acquisition rights to be issued:
            The maximum number shall be 1,190.

            The number of shares attached to one stock acquisition 
            right (hereinafter referred to as the "number of shares 
            attached") shall be 100 shares.  Provided, however, that 
            on or after the date on which stock acquisition rights 
            are issued (hereinafter referred to as the "issue date"), 
            in case the Company makes a stock split or stock 
            consolidation of shares of common stock, the number of 
            shares attached shall be adjusted proportional to the 
            percentages of such stock split or stock consolidation 
            of shares. In addition, in the case of any unavoidable 
            event, such as the Company's merger or corporate 
            partition that requires adjustments to be effected to 
            the number of shares attached, the number of shares 
            shall be adjusted to the reasonable extent, taking into 
            account the terms and conditions of the merger or 
            corporate partition or the like, and any number of share 
            less than one share arising out of such adjustment shall 
            be disregarded.

     (3)  Issue price of stock acquisition rights:
            Free of charge
          
     (4)  Amounts to be paid for the exercise of each stock 
          acquisition right:
            Amounts to be paid for the exercise of each stock 
            acquisition right shall be the amount to be paid per 
            share (hereinafter referred to as the "Exercise Price") 
            of shares to be issued or transferred upon exercise of 
            the stock acquisition right, multiplied by the number of 
            shares attached.
            The exercise price shall be an amount which is the 
            average of the closing prices (regular way) of the 
            Company's shares of common stock on the Tokyo Stock 
            Exchange, Ltd. on each day (other than any day on 
            which no sale is reported) of the month immediately 
            preceding the issue date, multiplied by 1.05.  Any 
            amount less than one yen arising out of such adjustment 
            shall be rounded upward to the nearest yen.  Provided, 
            however, that if such price is less than the 
            closing price as of the issue date, then such closing 
            price reported on the issue date shall instead be the 
            Exercise Price (if no closing price is reported on 
            such day, then the closing price reported on 
            the day immediately preceding that day).
            On or after the issue date, in case the Company issues 
            new shares of its common stock or disposes of its 
            Treasury stock at a price less than the current market 
            price (except for issue or transfer upon exercise of 
            stock acquisition rights or transfer of its 
            treasury stock pursuant to the provisions of Section 2, 
            Article 5 of the Supplement of the "Law regarding the 
            Partial Amendments, etc. to the Commercial Code, etc. of 
            Japan (Law No. 79, 2001)), the Exercise 
            Price shall be adjusted in accordance with the following 
            formula and any amount less than one yen arising out of 
            such adjustment shall be rounded upward to the nearest 
            yen:

                                                Number of    Amount 
                                                shares       paid
                               Number of      + newly  x     per 
                               shares           issued       share
                               issued    _________________________
                                                   Market price
                               ___________________________________
Exercise       Exercise Price  Number of         Number of shares
Price after  = before        x Shares issued  +  newly issued
adjustment     adjustment     

            "Number of shares issued" in the above formula means 
            the number of shares obtained by deducting the number 
            of treasury stock held by the Company from the number 
            of outstanding shares.  In case of disposal of 
            treasury stock, "Number of shares newly issued" shall 
            instead read as "Number of treasury stock to be disposed 
            of".  On or after the issue date, in case of a stock 
            split or stock consolidation of the Company's shares of 
            common stock, the Exercise Price shall be adjusted 
            proportional to the percentages of stock 
            split or stock consolidation of shares.
            In addition, in the case of any unavoidable event,
            such as the Company's merger or corporate partition 
            that requires adjustments to be effected to the 
            number of shares attached, the number of shares 
            shall be adjusted to the reasonable extent, taking 
            into account the terms and conditions of the
            merger or corporate partition or the like, and 
            any number of share less than one share arising 
            out of such adjustment shall be disregarded.
          
     (5)  Exercise period of stock acquisition rights:
            From August 1, 2007 to July 31, 2011
          
     (6)  Conditions of exercise of stock acquisition rights:
            Each stock acquisition right shall not be partially 
            exercised.
          
     (7)  Events and conditions of cancellation of stock 
          acquisition rights:
          (1)  If a proposal for approval of a merger agreement, 
               where the Company is dissolved, is approved at a 
               general meeting of stockholders of the Company, or 
               if a proposal for approval of a stock exchange 
               agreement or a proposal for share transfer is 
               approved at a general meeting of stockholders of 
               the Company, the Company may cancel stock 
               acquisition rights without any charge.
          (2)  The Company may, at any time, cancel without any 
               charge such outstanding and unexercised stock 
               acquisition rights as is acquired and owned by 
               itself.

     (8)      Restrictions on transfer of stock acquisition rights:
                Any transfer of stock acquisition rights shall be 
                subject to approval of the Board of Directors of the 
                Company.
     
3.   Summary of the allotment of stock acquisition rights:
       In addition, when granting stock acquisition rights to each 
       grantee, the Company shall enter into the "Granting of Stock 
       Acquisition Right Agreement" with each of the grantees, which 
       shall provide for the additional conditions deemed reasonable 
       by the Board of Directors for the purpose of the issuance of 
       stock acquisition rights.

Fourth Item:           Acquisition of own shares of the Company

You are requested to approve that the Company will acquire up to 
160,000 shares of common stock of the Company, with a maximum 
aggregate acquisition cost of Yen 1.6 billion, pursuant to 
Article 210 of the Commercial Code of Japan during the
period from the closing of this Ordinary General Meeting of 
Stockholders to the closing of next Ordinary General Meeting of 
Stockholders in 2006, in order to enable the Company to 
implement the stock option plan described in the Second
Item and the Third Item of the proposal.

Fifth Item:               Election of seven (7) Directors

The terms of offices of all seven (7) Directors will expire at 
the closing of this Ordinary General Meeting of Stockholders.  
You are requested to elect seven (7) Directors.



         Candidates for Directors are as follows:

Candidate      Name             Resume and Status as Other  Number 
No.       (Date of Birth)  Company's Representative, if any of
                                                            Shares 
                                                            of the
                                                            Company 
                                                            Owned

1.        Hajime Sawabe    April 1964:  entered into the    8,000
                                        Company             shares
          (Jan. 9, 1942)   May 1991:    General Manager of
                                        European Div. of 
                                        Recording 
                                        Media Business Group 
                                        of the Company
                           June 1996:   Director & General 
                                        Manager of Data 
                                        Storage Components
                                        Business Group of 
                                        the Company
                           June 1998:   President & 
                                        Representative 
                                        Director of the 
                                        Company
                                        (present post)
     
2.        Jiro Iwasaki     April 1974:  entered into the    2,000
                                        Company             shares

          (Dec. 6, 1945)   June 1992:   General Manager of
                                        Corporate Planning 
                                        Office of the 
                                        Company
                           June 1996:   Director and General 
                                        Manager 
                                        of Human Resources 
                                        Dept. 
                                        of the Company
                           June 1998:   Managing Director of 
                                        the Company
                                        General Manager of 
                                        Recording 
                                        Media & Systems 
                                        Business 
                                        Group of the Company
                           June 2002:   Director & Senior 
                                        Vice President of 
                                        the Company
                                        (present post)
                                        General Manager of 
                                        Administration Group 
                                        of the 
                                        Company (present
                                        post)
                                        in charge of Safety 
                                        and Environment 
                                        (present post)
3.        Shinji Yoko      April 1970:  entered into the    1,000
                                        Company             shares
          (Jan. 2, 1948)   Jan. 1994:   General Manager of 
                                        European Sales 
                                        Headquarters 
                                        of Electronic 
                                        Materials 
                                        Sales & Marketing 
                                        Dept. of 
                                        the Company
                           June 1998:   Director of the 
                                        Company
                           Jan. 1999:   Director, Deputy 
                                        General 
                                        Manager of Electronic
                                        Components Sales & 
                                        Marketing
                                        Division of the 
                                        Company
                                        General Manager of 
                                        Europe 
                                        Sales Office of 
                                        the Company 
                                        and General Manager 
                                        of Europe 
                                        Sales Division of the 
                                        Company
                           June 2002:   Director & 
                                        Senior Vice 
                                        President of the 
                                        Company
                                        (present post)
                                        General Manager of 
                                        Electronic
                                        Components Sales & 
                                        Marketing
                                        Business Group of the 
                                        Company
                                        (present post)
4.        Takeshi Nomura   April 1980:  entered into the    1,000
                                        Company             shares
          (Mar. 8, 1952)   June 1996:   General Manager of 
                                        Material 
                                        Research Center of 
                                        the Company
                           June 1998:   Director of the Company
                           June 2002:   Director & Senior Vice 
                                        President of the Company
                                        (present post)
                           July 2002:   General Manager of 
                                        Intellectual 
                                        Properties Center
                           Jan. 2004:   in charge of Technology
                                        General Manager of 
                                        Technology 
                                        Group of the 
                                        Company
                           April 2005:  General Manager of 
                                        Ferrite & 
                                        Magnet Products 
                                        Business Group
                                        (present post)
5.        Yasuhiro 
          Hagihara         April 1971:  registered as       0 
                                        lawyer in           share
                                        Washington D.C. 
                                        in the U.S.
          (Oct. 19, 1937)  Aug. 1976:   joined Graham and 
                                        James LLP 
                                        in the U.S.
                           Jan. 1979:   Partner of the said 
                                        law firm
                           July 2000:   Partner of 
                                        Squire Sanders & 
                                        Dempsey L.L.P.
                                        (Gaikokuhou 
                                        Jimu Bengoshi 
                                        Jimusho)
                                        (Currently Squire 
                                        Sanders
                                        (Gaikokuho Kyodo 
                                        Jigyo Horitsu
                                        Jimusho)) 
                                        (present post)
                           June 2002:   Director of the 
                                        Company
                                        (present post)
6.        Takehiro 
          Kamigama         April 1981:  entered into the    800
                                        Company             shares
          (Jan. 12, 1958)  April 2001:  General Manager in 
                                        charge 
                                        of strategic 
                                        technology of
                                        Recording Device 
                                        Business 
                                        Div. of the Company
                           Oct. 2001:   General Manager of Head 
                                        Business Group of 
                                        the Company
                                        (present post)
                           June 2002:   Corporate Officer 
                                        of the Company
                           June 2003:   Senior Vice President 
                                        of  the Company
                           June 2004:   Director and 
                                        Executive Vice 
                                        President of 
                                        the Company 
                                        (present post)
7. *      Seiji Enami      April 1974:  entered into the    1,100 
                                         Company            shares
          (Sep. 14, 1947)  April 1997:  General Manager of
                                        Corporate Planning 
                                        Dept. of Recording 
                                        Media 
                                        Business Div. of the 
                                        Company
                           April 2000:  General Manager of 
                                        Sales & Marketing Div. 
                                        of Recording
                                        Media & Systems 
                                        Business 
                                        Group of the Company
                           April 2001:  General Manager of 
                                        Finance 
                                        & Accounting Dept. of
                                        Administration Group of 
                                        the Company (present 
                                        post)
                           June 2004:   Corporate Officer of 
                                        the Company 
                                        (present post)
               
(Notes)   1.   None of the above seven (7) candidates has any 
               special interests in the Company.
          2.   The person with "*" mark is a new candidate for 
               Director.
          3.   Mr. Yasuhiro Hagihara is a candidate for an 
               outside Director to comply with the requirement 
               of outside director provided under 
               Paragraph 7-2, Section 2, Article 188 of the 
               Commercial Code of Japan.

                                                      - End -

Map to Technical Center of TDK Corporation
(Translation omitted)



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