MITSUBISHI ELECTRIC REPORTS 2000 FINANCIAL RESULTS
(April 1, 1999 - March 31, 2000)

TOKYO, May 18, 2000 - Mitsubishi Electric Corporation today announced its financial results for the fiscal year ended March 31, 2000 as follows:

Consolidated:
Net sales	3.7742 trillion yen (1% decrease from last year)
Operating income	79.2 billion yen
Income before income taxes	40.2 billion yen
Net income	24.8 billion yen
Non-consolidated:
Net sales	2.7050 trillion yen (2% decrease from last year)
Operating income	82.6 billion yen (134% increase from last year)
Income before income taxes	32.1 billion yen (542% increase from last year)
Net income	Net income 12.2 billion yen

In fiscal 2000, Japan's economy continued in a severe state due to factors including decreasing personal consumption and home investment caused by uneasiness about future employment and income prospects. However, there was a retreat from instability in financial systems, and policies concerning the relaxing of financial regulations and the expansion of public works projects began to take effect. In the latter half of the year in particular, due to vigorous demand abroad and improved business results along with an end to the trend of decreased capital expenditure, prospects were brighter compared with the previous year. Furthermore, there was expansion in the world economy: the US continued its high growth mainly due to domestic demand, the foundation for recovery became clearer in Europe and the East Asian economy made a rapid recovery.

As the economy continued to become more borderless, the electronics industry and its related industries both domestically and abroad faced rapid industry restructuring, competition continued to intensify and the management environment became increasingly severe.

Under these circumstances, a midterm plan of management objectives was set targeting the fiscal year 2001, which marks Mitsubishi Electric's 80th anniversary. To reach the objectives, the whole Mitsubishi Electric group made earnest efforts to strengthen its competitiveness and improve its financial status.

Cash Flow
Cash flow (income) obtained through sales activities amounted to 392.7 billion yen (an income increase of 222.0 billion yen compared to the previous year), cash flow (spending) in investment activities came to 167.8 billion yen (a spending increase of 9.6 billion compared to the previous fiscal year) while free cash flow amounted to an income of 224.9 billion yen (an improvement over the previous year's 212.3 billion yen).

As a result, the balance of debt, factoring in foreign currency translation adjustments of overseas subsidiaries, was reduced by 258.4 billion yen.

Consolidated Sales Results by Business Segment
In the Heavy Machinery group, compared to the previous year, sales decreased 10% to 820.9 billion yen and operating profits declined 39% to 30.6 billion yen. The power electric equipment business met lower orders and sales compared to last year's level due to restrained facility investment by domestic power companies and a decrease in large-scale projects in the overseas market. This holds true in the electric equipment production business for manufacturers as well, who faced sluggish facility investment by domestic manufacturers and decreased large business orders overseas. The transportation business marked increased sales and orders received. Although the business suffered due to investment restriction by domestic railway companies, it also received large orders from abroad. The public infrastructure business secured a high level in orders received and sales as in the previous year, owing to steady public investment. The buildings equipment business decreased both in orders received and sales because of a decreased demand for elevators and escalators both in the domestic and overseas market. As to the net results, sales for the whole of this segment were lower compared with last year. Operating profit showed a sharp decrease in the entire segment because of decreased profits from the power and buildings equipment businesses.

In the Industrial Products and Automation Equipment group, on a year-on-year basis, sales increased 2% to 620.1 billion yen while operating profits declined 32% to 27.1 billion yen. In the industrial products business, both orders received and sales of factory automation equipment, such as programmable controllers and servo motors, increased on a year-on-year basis due to the recovery of domestic demand triggered by the expansion of IT-related investment and an increase in demand in overseas markets, mainly in Asia. Orders received and sales of power distribution control equipment, however, leveled off from the previous year, due to the sluggish demand for domestic buildings and its related businesses. Sales of industrial automation operations decreased on a year-on-year basis resulting from stagnating domestic demand caused by investment restructuring in the automobile-related plant and equipment industry, considered one of Mitsubishi Electric's major businesses in this field, as well as the drop in demand in overseas markets. Orders received, however, remained at last year's level due to the increase in IT-related machine tools in the latter half of the fiscal year. Sales of automobile-related equipment grew on a year-on-year basis, due to the increase in sales of information equipment for automobiles and car electronics equipment and increased sales in the overseas market backed by continued economic growth in the United States. As a result, sales for the entire sector increased on a year-on-year basis. Overall operating income for this sector dropped significantly, which was attributable to the sharp decline both in industrial products and industrial automation equipment business.

In the Information, Telecommunications and Electronic Systems & Devices group, from a year earlier sales increased 7% to 1.5861 trillion yen and profitability was attained with operating profits at 12.8 billion yen. Products including SRAM and flash memory packages, system LSI, high frequency and optical devices, in which Mitsubishi Electric is leading the industry, increased sales both at home and abroad. LCD businesses marked a significant increase both in sales and orders received on a year-on-year basis, due to the stable demand for note-type PCs and LCD monitors, mainly 15 inch models. As for telecommunications businesses, both sales and orders received showed significant record growth from the previous year, due to the accelerating growth of the Internet and the healthy expansion of the mobile telephone market. Demand for submarine cable systems equipment, mobile phones and base stations for mobile phones grew greatly. Both orders received and sales of computer operations dropped on a year-on-year basis, due to the slow recovery on investment in plant and equipment mainly in the manufacturing industry and declining demand caused by Y2K problems. Space operations saw a huge increase in orders received due to large lot orders, including the communication satellite "OPTUS C-1," a first for Japan to get an order abroad for a commercial satellite, and Super Bird 5, in addition to favorable business factors in satellite components. As for defense operations, orders received increased from the previous year due to a slight increase in the government procurement budget. Alternatively, both space and defense operations marked a decline in sales, due to a gap between large-lot orders. As a result, the entire sector recorded improvement in sales on a year-on-year basis. Overall operating income for this entire sector increased for the first time in four years, due to profits of all operations improving, especially exemplified with the semiconductor business turning to profitability once again.

In the Consumer and Other Products group, compared to the previous year, sales declined 4% to 975.3 billion yen and the segment went into the black with operating profits at 8.5 billion yen. Although sales of oil fan heaters, air quality amenity equipment like humidifiers and dehumidifiers and color TVs increased on a year-on-year basis, those of air conditioners and refrigerators decreased. As a result, consumer products and audio-visual operations decreased sales on a year-on-year basis. Regarding air conditioning equipment operations for business use, sales dropped from the previous year due to the sluggish investment in plants and equipment. Sales of housing equipment operations increased on a year-on-year basis, due to the growth of its major products including ventilation fans and new businesses like solar power generation systems and smoke ventilation systems. Sales in overseas markets improved from the previous year due mainly to the growth in air conditioning businesses in Europe. In addition, sales in materials procurement, welfare programs and distribution sectors were up on a year-on-year basis. In total, the entire sector saw slight declines in sales volume. Operating income moved into the black for the first time in four years due to the significant improvements in the profitability of audio-visual operations resulting from extensive restructuring.

Dividend Policy
In the period under review, the midterm dividend was 2.5 yen and a year-end dividend of 2.5 yen is planned, making for a total 5 yen dividend per share payment for the year. (In the previous year, the midterm dividend was 0 yen, and the year-end dividend was 3 yen for a total 3 yen per share dividend).

Forecasts for Next Fiscal Year
Although it is expected that the management environment facing the company will not lend itself to optimism, Mitsubishi Electric will actively expand its telecommunications business beginning with the mobile phone business with its increasing business opportunities and system LSI and flash memory, the axis of the semiconductor business, in order to meet the IT revolution. Furthermore, competitiveness will be strengthened for IT applications in core businesses such as heavy machinery, industrial products, automation equipment and home electronics.

Regarding accounting for retirement benefit plans, the company's pension accounting has been done according to US generally accepted accounting procedures (GAAP) in consolidated financial result statements. Japanese accounting standards for pension plans similar to the US GAAP will be newly applied to non-consolidated financial result statements beginning in the fiscal year 2001. Mitsubishi Electric plans to contribute certain marketable equity securities as an employee retirement benefit trust in the first half of fiscal 2001.

Forecasts for the next fiscal year are as follows:

Reference
Main management objectives as announced in the Mid-term Corporate Strategy (announced in October 1999) were as follows (on a consolidated basis):