-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, WMmk0Z/E22+EUAWSWsVi5idSRz/X/zN3JB42Mt6LNijstzSIgYYInuuUHbrpXM2o 1mZpfR2iCdiQIljO4Yhq5A== 0000317891-04-000012.txt : 20041028 0000317891-04-000012.hdr.sgml : 20041028 20041028060641 ACCESSION NUMBER: 0000317891-04-000012 CONFORMED SUBMISSION TYPE: 6-K PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 20041028 FILED AS OF DATE: 20041028 DATE AS OF CHANGE: 20041028 FILER: COMPANY DATA: COMPANY CONFORMED NAME: RICOH CO LTD CENTRAL INDEX KEY: 0000317891 STANDARD INDUSTRIAL CLASSIFICATION: PHOTOGRAPHIC EQUIPMENT & SUPPLIES [3861] IRS NUMBER: 000000000 STATE OF INCORPORATION: M0 FISCAL YEAR END: 0331 FILING VALUES: FORM TYPE: 6-K SEC ACT: 1934 Act SEC FILE NUMBER: 002-68279 FILM NUMBER: 041100822 BUSINESS ADDRESS: STREET 1: 15-5 1-CHOME MINAMI-AOYAMA STREET 2: MINATO-KU CITY: TOKYO 107-8544 JAPAN STATE: M0 ZIP: 00000 MAIL ADDRESS: STREET 1: 15-5 1-CHOME MINAMI-AOYAMA STREET 2: MINATO-KU CITY: TOKYO 107-8544 JAPAN STATE: M0 ZIP: 00000 6-K 1 r6kh16oct28.txt INTERIM REPORT 9-30-2004 FORM 6-K SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 REPORT OF FOREIGN PRIVATE ISSUER Pursuant to Rule 13a-16 or 15d-16 of the Securities Exchange Act of 1934 For the month of October, 2004 Commission File Number 2 - 68279 RICOH COMPANY, LTD. ----------------------------------------------- (Translation of Registrant's name into English) 15-5, Minami-Aoyama 1-Chome, Minato-ku, Tokyo 107-8544, Japan ------------------------------------------------------------- (Address of Principal Executive Offices) (Indicate by check mark whether the registrant files or will file annual reports under cover Form 20-F or Form 40-F.) Form 20-F X Form 40-F __ (Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): __ ) (Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): __ ) (Indicate by check mark whether by furnishing the information contained in this Form, the registrant is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.) Yes __ No X (If "Yes" is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b): 82-__ ) - -------------------------------------------------------------------------------- SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. Ricoh Company, Ltd. ------------------------------ (Registrant) By: /S/ Zenji Miura ------------------------------ Zenji Miura Managing Director Executive Vice President General Manager of the Finance & Accounting Division October 28, 2004 - -------------------------------------------------------------------------------- [LOGO OF RICOH] INTERIM REPORT Half year ended September 30, 2004 (Results for the Period from April 1, 2004 to September 30, 2004) Three months ended September 30, 2004 (Results for the Period from July 1, 2004 to September 30, 2004) PERFORMANCE OUTLINE (Consolidated) (1) Half year ended September 30, 2004, 2003 and Year ending March 31, 2005 (Forecast)
(Billions of yen) - ------------------------------------------------------------------------------------------------ ------------------------------ Half year ended Half year ended September 30, September 30, Year ending 2004 2003 March 31, 2005 (Results) (Results) Change (Forecast) Change - ------------------------------------------------------------------------------------------------ ------------------------------ Domestic sales 469.1 448.6 4.6% 967.4 5.8% Overseas sales 406.8 439.4 -7.4% 842.6 2.7% Net sales 876.0 888.0 -1.4% 1,810.0 1.7% Gross profit 363.8 388.1 -6.2% 760.0 -0.7% Operating income 57.7 77.2 -25.2% 151.0 0.7% Income before income taxes 60.0 71.4 -15.9% 145.5 1.7% Net income 35.8 42.2 -15.2% 85.0 -7.4% - ------------------------------------------------------------------------------------------------ ------------------------------ Exchange rate (Yen/US$) 109.83 118.06 -8.23 107.42 -5.67 Exchange rate (Yen/EURO) 133.31 133.47 -0.16 131.66 -0.99 - ------------------------------------------------------------------------------------------------ ------------------------------ Net income per share (yen) 48.48 56.79 -8.31 115.05 -8.58 - ------------------------------------------------------------------------------------------------ ------------------------------ Total assets 1,877.4 1,912.1 -34.7 - - Shareholders' equity 830.2 703.0 127.2 - - Interest-bearing debt 435.3 484.9 -49.6 - - - ------------------------------------------------------------------------------------------------ ------------------------------ Equity ratio (%) 44.2 36.8 7.4 - - - ------------------------------------------------------------------------------------------------ ------------------------------ Shareholder's equity per share (yen) 1,123.84 946.38 177.46 - - - ------------------------------------------------------------------------------------------------ ------------------------------ Cash flows from operating activities 57.9 61.6 -3.6 - - Cash flows from investing activities -33.9 -19.9 -13.9 - - Cash flows from financing activities -16.9 -6.6 -10.2 - - Cash and cash equivalents at end of period 214.7 225.0 -10.3 - - - ------------------------------------------------------------------------------------------------ ------------------------------ Capital expenditures 38.2 36.3 1.9 76.0 0.4 Depreciation for tangible fixed assets 31.0 33.6 -2.5 70.0 2.3 R&D expenditures 53.4 44.2 9.1 107.0 14.4 - ------------------------------------------------------------------------------------------------ ------------------------------
(2) Three months ended September 30, 2004 and 2003
(Billions of yen) - ------------------------------------------------------------------------------------------------ Three months Three months ended ended September 30, September 30, 2004 2003 Change - ------------------------------------------------------------------------------------------------ Domestic sales 235.8 224.3 5.2% Overseas sales 203.5 226.3 -10.1% Net sales 439.4 450.6 -2.5% Gross profit 174.7 195.3 -10.6% Operating income 18.3 38.7 -52.6% Income before income taxes 18.7 34.0 -45.0% Net income 10.9 19.9 -45.1% - ------------------------------------------------------------------------------------------------ Exchange rate (Yen/US$) 110.01 117.61 -7.60 Exchange rate (Yen/EURO) 134.44 132.27 2.17 - ------------------------------------------------------------------------------------------------ Net income per share (yen) 14.79 26.75 -11.96 - ------------------------------------------------------------------------------------------------ Capital expenditures 19.5 17.6 1.9 Depreciation for tangible fixed assets 15.0 16.5 -1.4 R&D expenditures 29.0 24.8 4.2 - ------------------------------------------------------------------------------------------------
RICOH COMPANY, LTD. * The Company bases the forecast estimates for March 31, 2005 above upon information currently available to management, which involves risks and uncertainties that could cause actual results to differ materially from those projected. 1 POLICIES (1) Basic Management The Ricoh Group intends to be the company that gains most from the 21st century. With this aim, we will continue to provide high levels of reliability and to create new value in order to contribute both to productivity improvement and also to knowledge creation for individuals working anytime, anywhere. Accordingly, our proactive approach encompasses not only products and services for traditional office setups, but also customers working in a broadband environment. Our three-year 14th medium-term management plan - which extends from April 2002 until March 2005 - features the following five basic management policies: i. Realize a "vital and motivated culture" ii. Strengthen technologies to become the World No.1 product manufacturing company iii. Build "Customer-Friendly" and "Environmentally-Friendly" company iv. Strengthen each business unit and revolutionize group business structures v. Strengthen management constitution for competitive advantage (2) Medium-Term Management Strategies In terms of office equipment business - our core competence - we in the Ricoh Group have made every possible effort since the inception of our 13th medium-term management plan to move beyond the manufacture and retail of equipment such as copiers and printers so that we may overhaul our operational structure, thus enabling us to support our customers in their efforts to improve or enhance productivity through our offering. As these customers continue to experience heightened demand for operational improvement and reform, further expansion of digital networking will be accompanied by changes in the nature of critical customer information in terms of increased digitization, coloring, and volume. As a result of these factors, it is expected that efficient and effective I/O, storage, and searching of TDV (i.e., total document volume), which includes printed material in addition to photocopies, will become a pressing issue for our customers. Our 14th medium-term management plan thus focuses on the realization of TDV, thereby broadening our revenue and earning framework. In this, our basic strategy features the following three goals: i. Replacing monochrome products with color models To expand our lineup of compact color machines at prices comparable to those of monochrome models, thus satisfying our customers' requirements for color capability without being limited simply to the replacement of monochrome copiers. ii. Increased sales of high-speed models To provide high-speed copiers with a competitive edge in terms of purchase price, maintenance costs, and reliability, thus responding suitably to customer needs for high levels of efficiency. iii. Provision of printing solutions To propose optimum combinations of copiers and printers in order to allow customers to meet additional cost reduction requirements. In order to achieve these basic strategy goals, we have striven to complete our product lineup by continuously introducing new multifunction color models and color laser printers to the market in the current period. Multifunction color model 'Imagio Neo C385/325 series' and multifunction high-speed digital model 'Imagio Neo 752/602 series' have established an excellent reputation among our customers. Furthermore, Color ink-jet printers 'IPSiO G505/G707' that utilize Ricoh's original 'GEL JET' technology, released last year, also have performed favorably. At Ricoh, we strive to enhance our technological capabilities in order to become the world No.1 product manufacturing company, fully capable of providing products and services with an unrivalled competitive edge. In specific terms, these efforts focus on technologies aimed at developing next-generation, high-speed color imaging equipment, design and development aimed at simplifying the process of connecting various items of office hardware, and the creation of environmentally-friendly products and services. Furthermore, in terms of the stock acquisition of Hitachi Printing Solutions, Ltd., for which a basic agreement was reached at the end of March 2004, the process was completed on October 1, 2004. The mentioned company is now a group company of the Ricoh Group as Ricoh Printing Systems, Ltd. We will strive to achieve our aim of expanding and intensifying the printer business that is a focused business area in the strategy for growth by enhancing our product lineup and acquiring new customers. 2 (3) Basic Approach and Policies for Corporate Governance In our drive to enhance competitive strengths, Ricoh is committed to management transparency in accordance with our corporate philosophy and ethics. i. State of implementation of policies for corporate governance By reinforcing the board of directors and implementing an executive officer system in accordance with the following measures, we aim to strengthen both business administration and the enforcement of management. - - Adoption of a statutory auditor system - - Placement of an executive officer system and the assignment of authority to divisions in order to clarify their roles - - Maintaining a board of fourteen directors including an external member to handle major decisions on business administration and group management - - Establishment of a group management committee and enforcement of management through the auditing of individual divisions, formulation of optimum strategies for the group as a whole, and other similar activities - - Continuation of legally-required auditing through the efforts of five auditors (including two external auditors) and establishment of independent internal auditing by a corporate audit office [Chart of Corporate Governance] The chart of Corporate Governance is omitted. ii. Personal, capital-based, business, and other factors between the company and an external director and two external auditors. There are currently no conflicts of interest. iii. Corporate governance initiatives implemented by Ricoh over the past year In addition to establishing both a Corporate Social Responsibility (CSR) charter for the entire Ricoh Group and group-wide codes of conduct, we have recognized, understood, and strictly observed national law, international rules, and the corresponding thinking; furthermore, we have painstakingly ensured that all activities are carried out with a thorough sense of social awareness and responsibility. In terms of the disclosure of corporate information, corporate rules have been setup for the entire process comprising data research, gathering, reporting, and disclosure. Furthermore, a Disclosure Committee has been established in order to ensure that such information is disclosed in a proper, punctual, and comprehensive manner. In addition, in order to further promote effective internal control within the Ricoh Group, we have established the 'Internal Management and Control Office'. As a global corporation with high value of company, we are striving to reinvigorate the internal control system for the entire Group, provide education, and improve business processes in cooperation with the relevant departments and main Group Companies, with objectives of complying with relevant regulations and standards, improving effectiveness and efficiency of business process, and maintaining high credibility in financial reporting. In response to calls for higher degrees of independence for auditing firms, we have set forth regulations regarding the policies and procedures for pre-approval of audit and non-audit service. The board of auditors' pre-approval procedures have been implemented with respect to the content of auditing contracts and the corresponding charges. 3 (4) Challenges Although the economy of Japan and the US continues to exhibit some upswing momentum, prospects for the business climate remain unpredictable due to international instability in the Middle East and other regions, as well as concern for oil price fluctuation. In terms of our operating environment, the level of competition has increased significantly in the market for digital networking and coloring solutions. The Ricoh Group's priorities in the achievement of sustainable growth within such a challenging environment are to create new customer value and to manage in a highly-efficient manner, thereby enhancing corporate competitiveness. In order that we may create customer value through the identification of new customer requirements and the provision of the highest levels of product value to our customers, it is crucial that Ricoh achieves its aim of becoming the world No.1 product manufacturing company. With this fully in mind, we intend to redouble our efforts in the creation of value in all facets of management that target customer satisfaction, while at the same time reinforcing our technological strengths as a means of generating new value with our products and services. In addition, we intend to vigorously pursue the three customer-value factors that we, as a manufacturer, must achieve - namely, simplification of knowledge creation, harmony with the environment, and the well-being of all. In other words, we will strive to support our customer's knowledge creation activities, or alternatively, to create an environment that fosters the creation of knowledge; to provide products and services that allow our customers to contribute to protection of the environment; and to achieve higher levels of user friendliness so that customers may put our products and services to more efficient use. Steady progress is currently being made in the optimization of efficiency through process reform in all group fields. With enhancing our earning power through selection and concentration of business unit as well as these efforts, we intend to positively invest the profit that we have achieved in future growth. (5) Dividend Policy Ricoh endeavors to ensure that policies are regularly updated to take the dividend payout ratio into consideration in the payment of dividends, while at the same time increasing retained earnings for the enhancement of corporate structure and the generation of new business. Furthermore, these retained earnings will be used both in the reinforcement of core businesses and for investment in new fields with both medium-term and long-term perspectives. (6) Approach and Policies for Reducing Minimum Investment Lots Ricoh plans to keep investment patterns and shareholder composition under close scrutiny, and we will consider taking the appropriate steps to alter the minimum investment lot if so required. By reducing the minimum number of shares required to invest in the company, Ricoh believes that a broader range of investors can be attracted to equity markets, while at the same time, the liquidity of this company's shares may be enhanced. Nevertheless, many investors already trade in Ricoh's shares, and for this reason, management has concluded that there is no immediate need for reduction of the minimum investment lots. Furthermore, we intend to pay attention to the condition of business partners and of shareholder makeup as we carefully study both the necessity and the timing of implementation of these measures. 4 OPERATING RESULTS & FINANCIAL POSITION *Overview The Ricoh Group's consolidated net sales for the medium-term period of fiscal 2004 (the six months period from April 1 to September 30, 2004) decreased 1.4% from the previous corresponding period to Yen 876.0 billion. During this period, the average yen exchange rates were at Yen 109.83 against the dollar (up Yen 8.23) and Yen 133.31 against the euro (up Yen 0.16). Accordingly, the sales would be almost the same excluding effects of such foreign fluctuations. Domestic sales of Printing Systems such as MFPs (multifunctional printers) and laser printers continued to increase as a shift from standalone equipments to multifunctional network equipments progressed. As a result, domestic sales increased 4.6% from the previous corresponding period to Yen 469.1 billion. While overseas sales of color PPC and Printing Systems increased, decreased sales of optical discs and sale of some consolidated subsidiaries in optical-related analog business, as well as the effect of yen appreciation, resulted in 7.4% decrease from the previous corresponding period to Yen 406.8 billion in overseas sales. Excluding the effect of exchange fluctuations, the decline rate of overseas sales would be calculated at 4.7% from the previous corresponding period. Gross profit decreased 6.2% to Yen 363.8 billion from the previous corresponding period. This decrease is owing to active efforts in sales promotion of color equipments, weak performance in optical disc business, the above-mentioned sale of some businesses, and the yen's appreciation. Selling, general and administrative expenses decreased 1.5% from the previous corresponding period to Yen 306.1 billion. The strategic costs such as research and development expenses that increased 20.7% to Yen 53.4 billion, and IT investment for developing core operating systems increased. Meanwhile, the pension scheme reform of the last year resulted in less pension expenses, and efforts to reduce various expenses also contributed to the overall decrease. As a result, operating income decreased 25.2% from the previous corresponding period to Yen 57.7 billion. In terms of non-operating profit and loss, the enhancement of cash management activities in Japan, the US, and Europe led to reduction of both interest-bearing debt and interest expenses. Added to this, exchange profit occurred unlike the previous corresponding period with exchange loss, and contributed to an improvement of Yen 8.1 billion from the previous corresponding period. As a result, income before income taxes decreased 15.9% to Yen 60.0 billion from the previous corresponding period. Due to the change in Corporate Tax Law in Japan, the amount of tax exemption on research and development expenses increased, thereby leading to decrease in tax expenses. As a result, net income of the current term decreased 15.2% to Yen 35.8 billion. [Graph 1] Consolidated performance The graphs are omitted. The data in the omitted graphs can be shown at the schedule 1 in APPENDIX B. 5 *Consolidated Sales by Product Line Office Equipment (Yen 765.9 billion, down 1.2% from the previous corresponding - ------------------------------------------------------------------------------ period) - ------- The Ricoh Group makes solution proposals to customers for the optimization of their total printing cost in order to support their efficient management of TDV (total document volume). As a strategy to achieve this objective, the group is promoting technologies for digitalization, networking, colorization, and high-speed. Consequently, sales of color PPC, Printing Systems such as MFPs and laser printers have continued to grow. While domestic and overseas sales of these products increased, overall overseas sales decreased due to a sales decrease of optical discs and the effect of yen's appreciation. As a result of the above, total sales of office equipment decreased to Yen 765.9 billion, 1.2% down from the previous corresponding period. Excluding the effect of exchange fluctuations, the growth rate would be calculated as 0.3% increase from the previous corresponding period. Imaging Solutions (Yen 356.6 billion, down 14.1% from the previous ------------------------------------------------------------------ corresponding period) --------------------- Digital Imaging Systems -Due to a shift from standalone equipments to MFPs, both of domestic and overseas sales decreased from the previous corresponding period. -Sales of color PPC products increased, particularly overseas, partly due to release of new product. As a result, sales in this category decreased 10.9% from the previous corresponding period. Other Imaging Systems -Sales in this category decreased 23.5% from the previous corresponding period due to a shift from analog equipments to MFPs or color equipments. Network Input/Output Systems (Yen 310.3 billion, up 17.9% from the previous --------------------------------------------------------------------------- corresponding period) --------------------- Printing Systems -Sales of MFPs continued to increase both in Japan and overseas in response to demands for high-speed, networked, and color models. Major products contributing to sales increase are; MFPs: In Japan - Imagio Neo 135/165 series and Imagio Neo 752/602 series Overseas - Aficio 2035e/2045e series and Aficio 2105/2090 series Color MFPs: In Japan - Imagio Neo C245 and Imagio Neo C385/C325 series Overseas - Aficio 2232C/2238C series -Sales of laser printers grew as well. -IPSiO G707/G505, a color ink-jet printer utilizing Ricoh's original 'GEL JET' technology, is also accepted favorably by the customers and its sales increased. As a result, sales in this category increased 29.1% from the previous corresponding period. Other Input/Output Systems -Sales of optical disc products decreased both in Japan and overseas. In terms of the optical disk business, except media business, we plan to withdraw the self-developed drives and key module/parts unit business. Network System Solutions (Yen 99.0 billion, up 1.9% from the previous --------------------------------------------------------------------- corresponding period) --------------------- -Sales continued to increase in solution-centered activities such as support and service, as total printing cost optimization proposals for customers were approved. Other Businesses (Yen 110.0 billion, down 2.3% from the previous corresponding - ------------------------------------------------------------------------------ period) - ------- Sales of other business segments decreased 2.3% from the previous corresponding period to Yen 110.0 billion. While sales grew in optical equipments, leasing and other business activities in Japan, overseas sales in our semiconductor business decreased due to the effect of demand cycle for mobile communications equipments, as well as the effect of sale of some consolidated subsidiaries in optical-related analog business. [Graph 2] Consolidated sales by product line The graphs are omitted. The data in the omitted graphs can be shown at the schedule 2 in APPENDIX B. 6 * Consolidated Sales by Geographic Area Japan (Yen 469.1 billion, up 4.6% from the previous corresponding period) - ------------------------------------------------------------------------- Although the Japanese economy seems to be on the recovery in terms of companies' performance and capital investment, there is a concern about oil price fluctuations, and the markets are in severe competitive environment. In this context, sales of Printing Systems such as MFPs and laser printers increased owing to the implementation of products and marketing strategies to meet customer needs. In addition, solution-centered activities such as support and service also continued to grow. As a result, sales of office equipment increased 3.0% from the previous corresponding period. Sales of other business activities increased 11.0% from growth in optical-related business, leasing and other business. The Americas (Yen 161.3 billion, down 3.8% from the previous corresponding - -------------------------------------------------------------------------- period) - ------- With concern for repercussions from the Iraq war and strained situation in the Middle East, the US economy is uncertain, competition in its markets has become more intense, and the yen's appreciation has effected. Under these circumstances, we have focused on areas such as color PPC and printing systems in response to changes in customer needs for networking, color capability, and higher speeds. We have also committed to expand sales to major accounts. On the other hand, affected by decrease in sales of optical disc business and the others, total sales in the Americas resulted in 3.8% decrease from the previous corresponding period. After factoring out the yen's appreciation against dollar, it is calculated as 3.3% increased from the previous corresponding period. Europe (Yen 192.9 billion, down 2.0% from the previous corresponding period) - ---------------------------------------------------------------------------- The European economy is relatively stable, and sales of Printing Systems increased continuously, maintaining the top share in the European copier market. However, decreased sales of optical discs led to 2.0% decrease in total sales from the previous corresponding period. Others (Yen 52.5 billion, down 29.8% from the previous corresponding period) - ---------------------------------------------------------------------------- In other regions including China and other Asian countries, an overwhelming shift in business equipment to color models and MFPs translates into increasing sales in color PPC and MFPs. In terms of production, our manufacturing facilities in China increased their production responding to increased worldwide supply. Owing, however, to the effects of sale of some consolidated subsidiaries in optical-related analog business, decreased sales in optical discs, and decreased sales in semiconductor business influenced by demand cycle, total sales in other regions decreased 29.8% from the previous corresponding period. [Graph 3] Consolidated sales by geographic area The graphs are omitted. The data in the omitted graphs can be shown at the schedule 3 in APPENDIX B. 7 *Segment Information Business Segment - ---------------- Office Equipment - ---------------- As measures to realize Ricoh Group's core strategies, namely, 1) Replacing monochrome products with color models, 2) Increased sales of high-speed models, and 3) Provision of printing solutions, we have released a series of high value-added products with document functionality ranging from input/output to sharing and management, and endeavored to expand their sales. Accordingly, sales of printing systems such as color PPC, MFPs and laser printers increased both in Japan and overseas, and solution-centered activities such as support and service continued to increase steadily. On the other hand, the sales of optical disc business decreased. As a result, sales of office equipment decreased 1.2% from the previous corresponding period to Yen 765.9 billion. Turning our attention to operating expenses, there was strategic spending such as investment in research and development including developing main products for the next term and investment in IT development of core operating systems. Furthermore operating income decreased 20.0% to Yen 82.2 billion mainly due to the sales decrease in the optical disc business and the yen's appreciation. Capital investment was made with a focus on enhancing and expanding new product production lines and research and development, increasing from the previous corresponding period. Total assets increased from the previous corresponding period due to an increase in finance receivables and temporary increase of overseas inventories for sales expansion. Other Businesses - ---------------- Sales increased in the optical equipment and leasing businesses, while the semiconductor business decreased, particularly in sales overseas, from the effect of demand cycle for mobile communications equipments, and sale of some consolidated subsidiaries in optical-related analog business also reduced sales. As a result, total sales of other businesses decreased 2.1% from the previous corresponding period to Yen 111.3 billion. Operating income decreased from the previous corresponding period due to production adjustment in the semiconductor business. Total assets decreased from the previous corresponding period due to the above mentioned sale of some businesses and other factors.
(Billions of yen) - --------------------------------------------------------------------------------------------- Half year Half year ended ended September 30, September 30, 2004 2003 Change (%) - --------------------------------------------------------------------------------------------- Office Equipment: Net sales 765.9 775.5 -1.2 Operating income 82.2 102.6 -20.0 Operating income on sales(%) 10.7 13.2 -2.5 Identifiable assets 1,233.3 1,196.9 3.0 Capital expenditures 34.2 31.9 7.4 Depreciation 27.4 29.3 -6.6 - --------------------------------------------------------------------------------------------- Other Businesses: Net sales 111.3 113.7 -2.1 Operating income 1.2 2.9 -57.9 Operating income on sales(%) 1.1 2.6 -1.5 Identifiable assets 173.1 184.0 -5.9 Capital expenditures 2.7 3.9 -28.7 Depreciation 2.2 3.3 -33.4 - ---------------------------------------------------------------------------------------------
8 Geographic Segment - ------------------ Japan - ----- In the office equipment business, aggressive marketing strategies implemented in the severe competitive conditions increased sales of printing systems such as MFPs and laser printers in Japan. Aided by increased export to overseas markets, sales in Japan increased 1.2% to Yen 671.4 billion. Operating income decreased 30.1% to Yen 39.6 billion, due to active efforts in research and development for product development, decreased export sales in the optical disc and semiconductor businesses, and the effect of the yen's appreciation. The Americas - ------------ We achieved good results from such strategies as expanding sales of color PPC and Printing Systems, and bolstering our sales to major accounts, and saw growth in sales of these main products. However, sales in the Americas decreased 0.6% from the previous corresponding period to Yen 163.9 billion, due to a higher yen against the US dollar. Operating income decreased 20.2% to Yen 6.1 billion. Europe - ------ Sales of Printing Systems increased, and we have retained the top share of the European copier market. Influenced by sales decrease in optical disks, however, sales in Europe for the current term decreased 1.3% to Yen 195.7 billion. Operating income increased 15.2% to Yen 10.9 billion, owing to increased income from high value added products and the effect of continuous cost reducing activities. Others - ------ With a large-scale shift in demand toward digital, networked, and color-capable office equipment, demand has been growing. Sales in the Asia/Oceania region continued to increase, and we are enhancing our sales readiness in the promising Chinese market. Total sales in other regions, however, decreased 14.7% from the previous corresponding period to Yen 85.2 billion, influenced by the sale of some consolidated subsidiaries in the optical-related analog business. Operating income increased 19.0% to Yen 5.4 billion, due to decrease of the anticipatory investment costs for enhancing our sales system in China compared to the previous year, the effect of increased revenue and increased production, which began to appear in the current year from the previous year's investment, and the effect of continuous cost cutting activities in production activities.
(Billions of yen) - --------------------------------------------------------------------------------------------- Half year Half year ended ended September 30, September 30, 2004 2003 Change (%) - --------------------------------------------------------------------------------------------- Japan: Net sales 671.4 663.2 1.2 Operating income 39.6 56.7 -30.1 Operating income on sales(%) 5.9 8.6 -2.7 Identifiable assets 1,069.7 1,061.1 0.8 - --------------------------------------------------------------------------------------------- The Americas: Net sales 163.9 164.9 -0.6 Operating income 6.1 7.6 -20.2 Operating income on sales(%) 3.7 4.7 -1.0 Identifiable assets 205.1 192.7 6.5 - --------------------------------------------------------------------------------------------- Europe: Net sales 195.7 198.3 -1.3 Operating income 10.9 9.5 15.2 Operating income on sales(%) 5.6 4.8 0.8 Identifiable assets 206.1 186.6 10.4 - --------------------------------------------------------------------------------------------- Others: Net sales 85.2 99.8 -14.7 Operating income 5.4 4.5 19.0 Operating income on sales(%) 6.4 4.6 1.8 Identifiable assets 60.4 69.1 -12.7 - ---------------------------------------------------------------------------------------------
9 *Cash Flows
(Billions of yen) - --------------------------------------------------------------------------------------------- Half year Half year ended ended September 30, September 30, 2004 2003 Change - --------------------------------------------------------------------------------------------- Cash flows from operating activities 57.9 61.6 -3.6 Cash flows from investing activities -33.9 -19.9 -13.9 Cash flows from financing activities -16.9 -6.6 -10.2 Cash and Cash Equivalents at End of Period 214.7 225.0 -10.3 - ---------------------------------------------------------------------------------------------
Net cash provided by operating activities decreased Yen 3.6 billion as compared to the previous corresponding period to Yen 57.9 billion. Although collection of trade receivable went well, net income decreased, and overseas inventories for sales expansion and finance receivable increased. Net cash used in investing activities was Yen 33.9 billion, Yen 13.9 billion increase as compared to the previous corresponding period. While cash-in on securities sold decreased, capital investment was made in new product lines and new product development. As a result, free cash flow, which is the total of cash flow generated by operating activities and investing activities, decreased by Yen 17.6 billion from the previous corresponding period to Yen 24.0 billion. Net cash used in financing activities amounted to Yen 16.9 billion as a result of factors such as reduced borrowing by enhancing regional cash management, and the payment of dividends. Consequently, cash and cash equivalents at the end of this half-year period increased Yen 11.6 billion as compared to the end of the preceding year (March 31, 2004), to Yen 214.7 billion. Transition of our cashflow indices from fiscal 2001 to 2005 are as follows:
- -------------------------------------------------------------------------------------------------------------------------------- Half year Half year Half year Half year Half year ended ended ended ended ended September 30, September 30, September 30, September 30, September 30, 2000 2001 2002 2003 2004 - -------------------------------------------------------------------------------------------------------------------------------- Shareholders' equity / Total assets 35.4% 33.9% 36.3% 36.8% 44.2% Market capitalization / Total assets 86.9% 72.7% 84.2% 77.3% 81.7% Interest bearing debt / Operating cash flow 20.6 12.2 5.5 7.9 7.5 Operating cash flow / Interest expense 8.9 9.9 24.6 21.5 25.0 - --------------------------------------------------------------------------------------------------------------------------------
Notes: i. All indices are calculated based on consolidated data. ii. Market capitalization equals the stock price at the end of half year multipled by the number of shares outstanding at the end of half year. iii. Operating cash flow is shown in consolidated statement of cash flow. Interest bearing debt equals all debt in the consolidated balance sheets. 10 *Forecast for the entire fiscal year Forecast and measures of Ricoh Group for the entire fiscal year - --------------------------------------------------------------- Although the Japanese and American economies continue to be on a recovery and the European economy is stable, there is a concern about the unstable international situation in the Middle East and other regions, and oil price fluctuations, which lead us to think the future is still uncertain. Added to this, in terms of business environment, competition is getting even more intense in shift for color-capable products, digitalization and networking. With regard to forecasted results for the current fiscal year, we maintain our sales forecast of Yen 1,810.0 billion as announced in August this year. For the 3rd quarter and onward, we predict an exchange rate of Yen 105.00 against the US dollar, and of Yen 130.00 against the euro, without change. Meanwhile, as steady sales continue in our core products area such as color PPC and Printing Systems, we intend to implement business strategies including the release of valuable new products, and we believe that sales will consequently increase both in Japan and overseas. In terms of the optical disk business, except media business, we plan to withdraw the self-developed drives and key module/parts unit business. On the other hand we will aggressively take actions for strategic investment for color products area and for development for new products to offer. We consequently adjust our forecasted operating income and forecasted income before income taxes to Yen 151.0 billion to Yen 145.5 billion, respectively, We also adjust our net income in the current term to Yen 85.0 billion. As part of its 14th medium-term term management plan, which comes to completion with the end of this fiscal year, Ricoh Group has set a core strategy on expanding its profit base by acquiring total document volume (i.e., increasing volume and value per sheet). The basic strategy entails: - - Replacing monochrome products with color models - - Increased sales of high-speed models - - Provision of printing solutions We understand that the crucial challenges for our customers will be to improve workflow and enhance productivity by better managing TDV (total document volumes). We will support such efforts by continuing to formulate proposals to optimize customer's total printing costs and offer products and services that meet more sophisticated needs for color and faster office document production in color. In addition, we plan to enhance and expand our printing business which is a great pillar in the strategy for growth by enhancing our product lineup and acquiring new customers through acquisition of a new Ricoh Group member, Ricoh Printing Systems, Ltd. (formerly Hitachi Printing Solutions, Ltd.), for which stock transfer was completed on October 1st, 2004. Ricoh will pursue efficiencies through process reform in each business domain to ensure sustainable earnings growth and cash flows, as well as working on a low-cost management structure that can withstand yen appreciation and deflationary environments by further reinforcing price competitiveness with utmost cost reduction for products. Our performance forecasts for fiscal 2005 are as follows: Exchange Rate Assumptions for the 2nd half year US$ 1 = Yen 105.00 (Yen 109.83 in 1st half year) EURO 1 = Yen 130.00 (Yen 133.31 in 1st half year) Exchange Rate Assumptions for the full year ended March 31, 2005 US$ 1 = Yen 107.42 (Yen 113.09 in previous fiscal year) EURO 1 = Yen 131.66 (Yen 132.65 in previous fiscal year)
(Billions of yen) - ------------------------------------------------------------------------------------------------ Year ending Year ended March 31, 2005 March 31, 2004 (Forecast) (Results) Change - ------------------------------------------------------------------------------------------------ Domestic sales 967.4 914.0 5.8% Overseas sales 842.6 866.1 -2.7% Net sales 1,810.0 1,780.2 1.7% Gross profit 760.0 765.6 -0.7% Operating income 151.0 150.0 0.7% Income before income taxes 145.5 143.0 1.7% Net income 85.0 91.7 -7.4% - ------------------------------------------------------------------------------------------------
* Ricoh bases the forecast estimates for March 31, 2005 above upon information currently available to management, which involves risks and uncertainties that could cause actual results to differ materially from those projected. 11 RICOH COMPANY, LTD. AND CONSOLIDATED SUBSIDIARIES INTERIM REPORT (Consolidated. Half year Ended September 30, 2004) Date of approval for the financial results for the half year ended September 30, 2004, at the Board of Directors' meeting: October 28, 2004 1. RESULTS FOR THE PERIOD FROM APRIL 1, 2004 TO SEPTEMBER 30, 2004
(1) Operating Results (Millions of yen) - --------------------------------------------------------------------------------------------- Half year Half year Year ended ended ended September 30, September 30, March 31, 2004 2003 2004 - --------------------------------------------------------------------------------------------- Net sales 876,003 888,090 1,780,245 (% change from the previous corresponding periods) -1.4 3.6 2.4 Operating income 57,758 77,255 150,006 (% change from the previous corresponding periods) -25.2 26.0 12.2 Income before income taxes 60,064 71,416 143,063 (% change from the previous corresponding periods) -15.9 28.3 15.9 Net income 35,821 42,265 91,766 (% change from the previous corresponding periods) -15.2 26.1 26.6 Net income per share-basic (yen) 48.48 56.79 123.63 Net income per share-diluted (yen) - - - - ---------------------------------------------------------------------------------------------
Notes: i. Equity in income of affiliates: Yen 1,434 million; Yen 972 million (half year ended September 30, 2003); Yen 2,065 million (year ended March 31, 2004) ii. Average number of shares outstanding (consolidated): 738,843,718 shares; 744,261,032 shares (half year ended September 30, 2003); 742,292,806 shares (year ended March 31, 2004) iii. No change in accounting method has been made.
(2) Financial Position (Millions of yen) - --------------------------------------------------------------------------------------------- September 30, September 30, March 31, 2004 2003 2004 - --------------------------------------------------------------------------------------------- Total assets 1,877,455 1,912,162 1,852,793 Shareholders' equity 830,280 703,075 795,131 Equity ratio (%) 44.2 36.8 42.9 Equity per share (yen) 1,123.84 946.38 1,076.11 - ---------------------------------------------------------------------------------------------
Note: Number of shares outstanding as of September 30, 2004: 738,785,590 shares; 742,906,263 shares (September 30, 2003); 738,894,891 shares (March 31, 2004)
(3) Cash Flow (Millions of yen) - --------------------------------------------------------------------------------------------- Half year Half year Year ended ended ended September 30, September 30, March 31, 2004 2003 2004 - --------------------------------------------------------------------------------------------- Cash flows from operating activities 57,980 61,656 154,911 Cash flows from investing activities -33,939 -19,997 -63,383 Cash flows from financing activities -16,906 -6,643 -74,835 Cash and cash equivalents at end of period 214,706 225,013 203,039 - ---------------------------------------------------------------------------------------------
(4) Items relating to the scale of consolidation and the application of the equity method: Number of consolidated subsidiaries: 291; non-consolidated subsidiaries: 41; affiliated companies: 21 (5) Changes relating to the scale of consolidation and the application of the equity method: Consolidated subsidiaries: 1 addition; 31 removals Companies accounted for by the equity method: 3 additions; 1 removal Notes: Consolidated financial statements of the Company and its consolidated subsidiaries have been prepared in conformity with accounting principles generally accepted in the United States of America.
2. FORECAST OF OPERATING RESULTS FROM APRIL 1, 2004 TO MARCH 31, 2005 (Millions of yen) - --------------------------------------------------------------------------------------------- Net sales 1,810,000 Operating income 151,000 Income before income taxes 145,500 Net income 85,000 - ---------------------------------------------------------------------------------------------
Note: Net income per share (Consolidated) 115.05 yen In accordance with Japanese regulations, Ricoh has issued forecast for its financial results for the fiscal year ending March 2005. These forecast are forward-looking statements based on a number of assumptions and beliefs in light of the information currently available to management and subject to significant risks and uncertainties. 12 GROUP POSITION The Ricoh Group comprises 332 subsidiaries and 21 affiliates. Their development, manufacturing, sales, and service activities center on office equipment business and other businesses (optical equipments, semiconductors and metering equipments). Ricoh Company, Ltd., a parent company, heads development. The parent company and subsidiaries or affiliates maintain an integrated domestic and international manufacturing structure. Below, we have listed our main product areas and the positions of key subsidiaries and affiliates. [Office Equipment Business] In this business category, Ricoh provides products and systems that support the enhancement of the office productivity of customers. Major products include: Digital/analog copiers, MFPs (multifunctional printers), laser printers, facsimile machines, digital duplicators, optical disks. Ricoh also provides solution systems including personal computers and servers, utilizing its information technology. Another business Ricoh also provides are support, service, and related supplies, as well as support and service including IT environment setup and network administration. [Main Subsidiaries and Affiliates] Production Japan...Tohoku Ricoh Co., Ltd., Ricoh Elemex Corporation, Ricoh Unitechno Co., Ltd., Hasama Ricoh Inc., Ricoh Microelectronics Co., Ltd., and Ricoh Keiki Co., Ltd. The Americas...Ricoh Electronics, Inc. Europe...Ricoh UK Products Ltd., Ricoh Industrie France S.A.S. Other regions...Ricoh Asia Industry (Shenzhen) Ltd., Shanghai Ricoh Facsimile Co., Ltd., and Sindo Ricoh Co., Ltd. (affiliated company) Sales and Service Japan ...Ricoh Tohoku Co., Ltd., Ricoh Chubu Co., Ltd., Ricoh Kansai Co., Ltd., Ricoh Chugoku Co., Ltd., Ricoh Kyushu Co., Ltd., Tokyo Ricoh Co., Ltd. and 39 other sales companies nationwide, Ricoh Technosystems Co., Ltd., NBS Ricoh Co., Ltd., Ricoh Leasing Co., Ltd., and Ricoh Logistics System Co., Ltd. The Americas...Ricoh Corporation, Savin Corporation, and Lanier Worldwide, Inc. Europe...Ricoh Europe B.V., Ricoh Deutschland GmbH, Ricoh UK Ltd., Ricoh France S.A., Ricoh Espana S.A., Ricoh Italia S.p.A., and NRG Group PLC Other regions...Ricoh China Co., Ltd., Ricoh Hong Kong Ltd., Ricoh Asia Pacific Pte. Ltd., Ricoh Australia Pty, Ltd., and Ricoh New Zealand Ltd. [Other Businesses] Manufacturing and marketing optical equipment, semiconductors and metering equipments, and providing leasing and logistics services [Main Subsidiaries and Affiliates] Production Ricoh Optical Industries Co., Ltd., Ricoh Elemex Corporation Sales Ricoh Corporation, NRG Group PLC Other Ricoh Leasing Co., Ltd., Ricoh Logistics System Co., Ltd., and Coca-Cola West Japan Co., Ltd. (affiliated company) [Chart of Business System] The chart of group position is omitted. 13 CONSOLIDATED PERFORMANCE 1. CONSOLIDATED STATEMENTS OF INCOME
(Three months ended September 30, 2004 and 2003) (Millions of yen) - ---------------------------------------------------------------------------------------------------------------- Three months Three months ended ended September 30, September 30, 2004 2003 Change % - ---------------------------------------------------------------------------------------------------------------- Net sales 439,453 450,637 -11,184 -2.5 Cost of sales 264,744 255,282 9,462 3.7 Percentage of net sales (%) 60.2 56.6 Gross Profit 174,709 195,355 -20,646 -10.6 Percentage of net sales (%) 39.8 43.4 Selling, general and administrative expenses 156,338 156,584 -246 -0.2 Percentage of net sales (%) 35.6 34.8 Operating income 18,371 38,771 -20,400 -52.6 Percentage of net sales (%) 4.2 8.6 Other (income) expense Interest and dividend income 470 617 -147 -23.8 Percentage of net sales (%) 0.1 0.1 Interest expense 1,086 1,339 -253 -18.9 Percentage of net sales (%) 0.2 0.3 Other, net -990 3,950 -4,940 - Percentage of net sales (%) -0.2 0.8 Income before income taxes, equity income and minority interests 18,745 34,099 -15,354 -45.0 Percentage of net sales (%) 4.3 7.6 Provision for income taxes 7,860 14,362 -6,502 -45.3 Percentage of net sales (%) 1.8 3.2 Minority interests in earnings of subsidiaries 780 347 433 124.8 Percentage of net sales (%) 0.2 0.1 Equity in earnings of affiliates 822 520 302 58.1 Percentage of net sales (%) 0.2 0.1 Net income 10,927 19,910 -8,983 -45.1 Percentage of net sales (%) 2.5 4.4 - ---------------------------------------------------------------------------------------------------------------- Reference : Exchange rate US$ 1 Yen 110.01 Yen 117.61 EURO 1 Yen 134.44 Yen 132.27
(Half year ended September 30, 2004 and 2003 and Year ended March 31, 2004) (Millions of yen) - -------------------------------------------------------------------------------------------------------------------------------- Half year Half year ended ended Year ended September 30, September 30, March 31, 2004 2003 Change % 2004 - -------------------------------------------------------------------------------------------------------------------------------- Net sales 876,003 888,090 -12,087 -1.4 1,780,245 Cost of sales 512,123 499,983 12,140 2.4 1,014,619 Percentage of net sales (%) 58.5 56.3 57.0 Gross Profit 363,880 388,107 -24,227 -6.2 765,626 Percentage of net sales (%) 41.5 43.7 43.0 Selling, general and administrative expenses 306,122 310,852 -4,730 -1.5 615,620 Percentage of net sales (%) 34.9 35.0 34.6 Operating income 57,758 77,255 -19,497 -25.2 150,006 Percentage of net sales (%) 6.6 8.7 8.4 Other (income) expense Interest and dividend income 1,073 1,313 -240 -18.3 1,925 Percentage of net sales (%) 0.1 0.1 0.1 Interest expense 2,316 2,863 -547 -19.1 5,290 Percentage of net sales (%) 0.3 0.3 0.3 Other, net -3,549 4,289 -7,838 - 3,578 Percentage of net sales (%) -0.5 0.5 0.2 Income before income taxes, equity income and minority interests 60,064 71,416 -11,352 -15.9 143,063 Percentage of net sales (%) 6.9 8.0 8.0 Provision for income taxes 23,779 28,424 -4,645 -16.3 56,641 Percentage of net sales (%) 2.7 3.2 3.2 Minority interests in earnings of subsidiaries 1,898 1,699 199 11.7 4,094 Percentage of net sales (%) 0.2 0.1 0.2 Equity in earnings of affiliates 1,434 972 462 47.5 2,065 Percentage of net sales (%) 0.1 0.1 0.1 Income before cumulative effect 35,821 42,265 -6,444 -15.2 84,393 of accounting changes Percentage of net sales (%) 4.1 4.8 4.7 Cumulative effect of accounting change, net of tax - - - - 7,373 Percentage of net sales (%) - - 0.5 Net income 35,821 42,265 -6,444 -15.2 91,766 Percentage of net sales (%) 4.1 4.8 5.2 - -------------------------------------------------------------------------------------------------------------------------------- Reference : Exchange rate US$ 1 Yen 109.83 Yen 118.06 Yen 113.09 EURO 1 Yen 133.31 Yen 133.47 Yen 132.65
14 2-1. CONSOLIDATED SALES BY PRODUCT CATEGORY
(Three months ended September 30, 2004 and 2003) (Millions of yen) - ---------------------------------------------------------------------------------------------------------------- Three months Three months ended ended September 30, September 30, 2004 2003 Change % - ---------------------------------------------------------------------------------------------------------------- [Office Equipment] Imaging Solutions: Digital Imaging Systems 136,148 150,161 -14,013 -9.3 Percentage of net sales (%) 31.0 33.3 Other Imaging Systems 38,828 52,165 -13,337 -25.6 Percentage of net sales (%) 8.8 11.6 Total Imaging Solutions 174,976 202,326 -27,350 -13.5 Percentage of net sales (%) 39.8 44.9 - ---------------------------------------------------------------------------------------------------------------- Network Input/Output Systems: Printing Systems 149,373 117,351 32,022 27.3 Percentage of net sales (%) 34.0 26.0 Other Input/Output Systems 3,594 18,304 -14,710 -80.4 Percentage of net sales (%) 0.8 4.1 Total Network Input/Output Systems 152,967 135,655 17,312 12.8 Percentage of net sales (%) 34.8 30.1 - ---------------------------------------------------------------------------------------------------------------- Network System Solutions 54,049 53,795 254 0.5 Percentage of net sales (%) 12.3 11.9 - ---------------------------------------------------------------------------------------------------------------- Office Equipment Total 381,992 391,776 -9,784 -2.5 Percentage of net sales (%) 86.9 86.9 - ---------------------------------------------------------------------------------------------------------------- [Other Businesses] Other Businesses 57,461 58,861 -1,400 -2.4 Percentage of net sales (%) 13.1 13.1 - ---------------------------------------------------------------------------------------------------------------- Grand Total 439,453 450,637 -11,184 -2.5 Percentage of net sales (%) 100.0 100.0 - ---------------------------------------------------------------------------------------------------------------- Reference : Exchange rate US$ 1 Yen 110.01 Yen 117.61 EURO 1 Yen 134.44 Yen 132.27
(Half year ended September 30, 2004 and 2003 and Year ended March 31, 2004) (Millions of yen) - -------------------------------------------------------------------------------------------------------------------------------- Half year Half year Year ended ended ended September 30, September 30, March 31, 2004 2003 Change % 2004 - -------------------------------------------------------------------------------------------------------------------------------- [Office Equipment] Imaging Solutions: Digital Imaging Systems 275,531 309,158 -33,627 -10.9 606,270 Percentage of net sales (%) 31.5 34.8 34.1 Other Imaging Systems 81,074 105,936 -24,862 -23.5 197,304 Percentage of net sales (%) 9.2 11.9 11.0 Total Imaging Solutions 356,605 415,094 -58,489 -14.1 803,574 Percentage of net sales (%) 40.7 46.7 45.1 - -------------------------------------------------------------------------------------------------------------------------------- Network Input/Output Systems: Printing Systems 301,343 233,457 67,886 29.1 509,212 Percentage of net sales (%) 34.4 26.3 28.6 Other Input/Output Systems 8,979 29,725 -20,746 -69.8 49,025 Percentage of net sales (%) 1.0 3.3 2.8 Total Network Input/Output Systems 310,322 263,182 47,140 17.9 558,237 Percentage of net sales (%) 35.4 29.6 31.4 - -------------------------------------------------------------------------------------------------------------------------------- Network System Solutions 99,038 97,232 1,806 1.9 195,822 Percentage of net sales (%) 11.3 11.0 11.0 - -------------------------------------------------------------------------------------------------------------------------------- Office Equipment Total 765,965 775,508 -9,543 -1.2 1,557,633 Percentage of net sales (%) 87.4 87.3 87.5 - -------------------------------------------------------------------------------------------------------------------------------- [Other Businesses] Other Businesses 110,038 112,582 -2,544 -2.3 222,612 Percentage of net sales (%) 12.6 12.7 12.5 - -------------------------------------------------------------------------------------------------------------------------------- Grand Total 876,003 888,090 -12,087 -1.4 1,780,245 Percentage of net sales (%) 100.0 100.0 100.0 - -------------------------------------------------------------------------------------------------------------------------------- Reference : Exchange rate US$ 1 Yen 109.83 Yen 118.06 Yen 113.09 EURO 1 Yen 133.31 Yen 133.47 Yen 132.65
Each category includes the following product line: Digital Imaging Systems Digital PPCs, color PPCs, digital duplicators and facsimile machines Other Imaging Systems Analog PPCs, diazo copiers, and thermal paper Printing Systems MFPs(multifunctional printers), laser printers and software Other Input/Output Systems Optical discs and system scanners Network System Solutions Personal computers, PC servers, network systems and network related software Other Businesses Optical equipments, metering equipments and semiconductors 15 2-2. CONSOLIDATED SALES BY GEOGRAPHIC AREA
(Three months ended September 30, 2004 and 2003) (Millions of yen) - ---------------------------------------------------------------------------------------------------------------- Three months Three months ended ended September 30, September 30, 2004 2003 Change % - ---------------------------------------------------------------------------------------------------------------- [Domestic] 235,864 224,301 11,563 5.2 Percentage of net sales (%) 53.7 49.8 [Overseas] 203,589 226,336 -22,747 -10.1 Percentage of net sales (%) 46.3 50.2 The Americas 82,929 88,173 -5,244 -5.9 Percentage of net sales (%) 18.9 19.6 Europe 92,664 98,332 -5,668 -5.8 Percentage of net sales (%) 21.1 21.8 Other 27,996 39,831 -11,835 -29.7 Percentage of net sales (%) 6.3 8.8 Grand Total 439,453 450,637 -11,184 -2.5 Percentage of net sales (%) 100.0 100.0 - ---------------------------------------------------------------------------------------------------------------- Reference : Exchange rate US$ 1 Yen 110.01 Yen 117.61 EURO 1 Yen 134.44 Yen 132.27
(Half year ended September 30, 2004 and 2003 and Year ended March 31, 2004) (Millions of yen) - -------------------------------------------------------------------------------------------------------------------------------- Half year Half year Year ended ended ended September 30, September 30, March 31, 2004 2003 Change % 2004 - -------------------------------------------------------------------------------------------------------------------------------- [Domestic] 469,176 448,636 20,540 4.6 914,060 Percentage of net sales (%) 53.6 50.5 51.3 [Overseas] 406,827 439,454 -32,627 -7.4 866,185 Percentage of net sales (%) 46.4 49.5 48.7 The Americas 161,330 167,664 -6,334 -3.8 326,380 Percentage of net sales (%) 18.4 18.9 18.3 Europe 192,987 196,951 -3,964 -2.0 402,392 Percentage of net sales (%) 22.0 22.2 22.6 Other 52,510 74,839 -22,329 -29.8 137,413 Percentage of net sales (%) 6.0 8.4 7.8 Grand Total 876,003 888,090 -12,087 -1.4 1,780,245 Percentage of net sales (%) 100.0 100.0 100.0 - -------------------------------------------------------------------------------------------------------------------------------- Reference : Exchange rate US$ 1 Yen 109.83 Yen 118.06 Yen 113.09 EURO 1 Yen 133.31 Yen 133.47 Yen 132.65
16 3. CONSOLIDATED BALANCE SHEETS (September 30, 2004 and March 31, 2004)
Assets (Millions of yen) - --------------------------------------------------------------------------------------------- September 30, March 31, 2004 2004 Change - --------------------------------------------------------------------------------------------- Current Assets Cash and time deposits 215,559 204,001 11,558 Trade receivables 397,310 422,244 -24,934 Marketable securities 51,119 45,124 5,995 Inventories 151,793 145,369 6,424 Other current assets 55,161 55,079 82 Total Current Assets 870,942 871,817 -875 Fixed Assets Tangible fixed assets 237,757 238,712 -955 Finance receivable 536,636 514,047 22,589 Other Investments 232,120 228,217 3,903 Total Fixed Assets 1,006,513 980,976 25,537 - --------------------------------------------------------------------------------------------- Total Assets 1,877,455 1,852,793 24,662 - --------------------------------------------------------------------------------------------- Note: Contents of cash and time deposits: Cash and cash equivalents 214,706 203,039 Time deposits 853 962
Liabilities and Shareholders' Investment (Millions of yen) - --------------------------------------------------------------------------------------------- September 30, March 31, 2004 2004 Change - --------------------------------------------------------------------------------------------- Current Liabilities Trade payables 276,551 297,672 -21,121 Short-term borrowings 207,868 151,162 56,706 Other current liabilities 158,705 158,594 111 Total Current Liabilities 643,124 607,428 35,696 Fixed Liabilities Long-term indebtedness 227,452 281,570 -54,118 Retirement benefit obligation 87,017 83,492 3,525 Other fixed liabilities 39,167 36,295 2,872 Total Fixed Liabilities 353,636 401,357 -47,721 - --------------------------------------------------------------------------------------------- Total Liabilities 996,760 1,008,785 -12,025 - --------------------------------------------------------------------------------------------- Minority Interest 50,415 48,877 1,538 - --------------------------------------------------------------------------------------------- Shareholders' Investment Common stock 135,364 135,364 - Additional paid-in capital 186,600 186,599 1 Retained earnings 544,581 515,372 29,209 Accumulated other comprehensive income (loss) -24,095 -30,272 6,177 Treasury stock -12,170 -11,932 -238 Total Shareholders' Investment 830,280 795,131 35,149 - --------------------------------------------------------------------------------------------- Total Liabilities and Shareholders' Investment 1,877,455 1,852,793 24,662 - --------------------------------------------------------------------------------------------- Note: Other comprehensive income; Net unrealized holding gains on available-for-sale securities 3,858 4,026 -168 Pension liability adjustments -16,872 -14,863 -2,009 Net unrealized gains (losses) on derivative instruments -23 -24 1 Cumulative translation adjustments -11,058 -19,411 8,353
Reference: Exchange rate September 30, 2004 March 31, 2004 US$ 1 Yen 111.05 Yen 105.69 EURO 1 Yen 137.04 Yen 128.88 4. RETAINED EARNINGS
(Half year ended September 30, 2004 and Year ended March 31, 2004) (Millions of yen) - ------------------------------------------------------------------------------------- Half year ended Year ended September 30, March 31, 2004 2004 - ------------------------------------------------------------------------------------- Retained earnings (beginning balance) 515,372 434,748 Adjustment for change of fiscal period on consolidated subsidiaries 777 - Net income 35,821 91,766 Cash dividends 7,389 11,142 Retained earnings (ending balance) 544,581 515,372 - -------------------------------------------------------------------------------------
17 5. CONSOLIDATED STATEMENTS OF CASH FLOW
(Half year ended September 30, 2004 and 2003 and Year ended March 31, 2004) (Millions of yen) - ------------------------------------------------------------------------------------------------------------------ Half year Half year Year ended ended ended September 30, September 30, March 31, 2004 2003 2004 - ------------------------------------------------------------------------------------------------------------------ I. Cash Flows from Operating Activities: 1. Net income 35,821 42,265 91,766 2. Adjustments to reconcile net income to net cash provided by operating activities-- Depreciation and amortization 36,963 37,827 76,968 Equity in earnings of affiliates, net of dividends received -631 -230 -1,001 Deferred income taxes 2,362 -1,257 3,338 Loss on disposal and sales of tangible fixed assets 1,569 837 2,035 Cumulative effect of accounting change - - -7,373 Changes in assets and liabilities-- (Increase) decrease in trade receivables 27,001 7,935 -11,367 Increase in inventories -6,122 -7,979 -4,317 Increase in finance receivables -20,876 -21,723 -32,650 (Decrease) increase in trade payables -20,386 -6,773 21,316 Decrease in accrued income taxes and accrued expenses and other -3,765 -5,069 -5,913 Retirement benefit obligation, net 1,332 9,806 -609 Other, net 4,712 6,017 22,718 - ------------------------------------------------------------------------------------------------------------------ Net cash provided by operating activities 57,980 61,656 154,911 - ------------------------------------------------------------------------------------------------------------------ II. Cash Flows from Investing Activities: 1. Proceeds from sales of property, plant and equipment 578 134 190 2. Expenditures for tangible fixed assets -37,758 -36,282 -75,432 3. Payments for purchases of available-for-sale securities -6,149 -25,103 -35,518 4. Proceeds from sales of available-for-sale securities 5 33,514 45,464 5. Decrease in time deposits 118 9,159 9,915 6. Other, net 9,267 -1,419 -8,002 - ------------------------------------------------------------------------------------------------------------------ Net cash used in investing activities -33,939 -19,997 -63,383 - ------------------------------------------------------------------------------------------------------------------ III. Cash Flows from Financing Activities: 1. Proceeds from long-term indebtedness 24,917 1,125 13,349 2. Repayment of long-term indebtedness -33,832 -15,970 -31,509 3. (Decrease) increase in short-term borrowings, net 9,099 30,244 -10,728 4. Proceeds from issuance of long-term debt securities 9,000 1,000 1,000 5. Repayment of long-term debt securities -18,000 -14,000 -23,910 6. Cash dividends paid -7,405 -5,181 -11,136 7. Purchase of treasury stocks -251 -3,643 -11,411 8. Other, net -434 -218 -490 - ------------------------------------------------------------------------------------------------------------------ Net cash used in financing activities -16,906 -6,643 -74,835 - ------------------------------------------------------------------------------------------------------------------ IV. Effect of Exchange Rate Changes on Cash and Cash Equivalents 2,057 754 -2,897 - ------------------------------------------------------------------------------------------------------------------ V. Net Increase in Cash and Cash Equivalents 9,192 35,770 13,796 - ------------------------------------------------------------------------------------------------------------------ VI. Cash and Cash Equivalents at Beginning of Year 203,039 189,243 189,243 VII. Adjustment for Change of Fiscal Period on Consolidated Subsidiaries 2,475 - - - ------------------------------------------------------------------------------------------------------------------ VIII. Cash and Cash Equivalents at End of Period 214,706 225,013 203,039 - ------------------------------------------------------------------------------------------------------------------
18 6. SEGMENT INFORMATION (1) Industry Segment Information
(Three months ended September 30, 2004 and 2003) (Millions of yen) - ---------------------------------------------------------------------------------------------------------------- Three months Three months ended ended September 30, September 30, 2004 2003 Change % - ---------------------------------------------------------------------------------------------------------------- OFFICE EQUIPMENT: Net sales: Unaffiliated customers 381,992 391,776 -9,784 -2.5 Intersegment - - - - Total 381,992 391,776 -9,784 -2.5 - ---------------------------------------------------------------------------------------------------------------- Operating expenses 349,896 337,322 12,574 3.7 - ---------------------------------------------------------------------------------------------------------------- Operating income 32,096 54,454 -22,358 -41.1 Operating income on office equipment sales(%) 8.4 13.9 - ---------------------------------------------------------------------------------------------------------------- OTHER BUSINESSES: Net sales: Unaffiliated customers 57,461 58,861 -1,400 -2.4 Intersegment 598 538 60 11.2 Total 58,059 59,399 -1,340 -2.3 - ---------------------------------------------------------------------------------------------------------------- Operating expenses 57,889 58,825 -936 -1.6 - ---------------------------------------------------------------------------------------------------------------- Operating income 170 574 -404 -70.4 Operating income on sales in other businesses (%) 0.3 1.0 - ---------------------------------------------------------------------------------------------------------------- CORPORATE AND ELIMINATIONS: Net sales: Intersegment -598 -538 -60 - Total -598 -538 -60 - - ---------------------------------------------------------------------------------------------------------------- Operating expenses: Intersegment -590 -548 -42 - Corporate 13,887 16,267 -2,380 - Total 13,297 15,719 -2,422 - - ---------------------------------------------------------------------------------------------------------------- Operating income -13,895 -16,257 2,362 - - ---------------------------------------------------------------------------------------------------------------- CONSOLIDATED: Net sales: Unaffiliated customers 439,453 450,637 -11,184 -2.5 Intersegment - - - - Total 439,453 450,637 -11,184 -2.5 - ---------------------------------------------------------------------------------------------------------------- Operating expenses 421,082 411,866 9,216 2.2 - ---------------------------------------------------------------------------------------------------------------- Operating income 18,371 38,771 -20,400 -52.6 Operating income on consolidated net sales(%) 4.2 8.6 - ----------------------------------------------------------------------------------------------------------------
Identifiable assets: (Millions of yen) - ---------------------------------------------------------------------------------------------------------------- September 30, September 30, 2004 2003 Change % - ---------------------------------------------------------------------------------------------------------------- Office Equipment 1,233,319 1,196,927 36,392 3.0 Other Businesses 173,133 184,083 -10,950 -5.9 Elimination -9,185 -7,596 -1,589 20.9 Corporate assets 480,188 538,748 -58,560 -10.9 - ---------------------------------------------------------------------------------------------------------------- Total 1,877,455 1,912,162 -34,707 -1.8 - ----------------------------------------------------------------------------------------------------------------
Capital expenditure: (Millions of yen) - ---------------------------------------------------------------------------------------------------------------- Three months Three months ended ended September 30, September 30, 2004 2003 Change % - ---------------------------------------------------------------------------------------------------------------- Office Equipment 17,725 14,621 3,104 21.2 Other Businesses 1,095 2,665 -1,570 -58.9 Corporate 770 391 379 96.9 - ---------------------------------------------------------------------------------------------------------------- Total 19,590 17,677 1,913 10.8 - ----------------------------------------------------------------------------------------------------------------
Depreciation: (Millions of yen) - ---------------------------------------------------------------------------------------------------------------- Three months Three months ended ended September 30, September 30, 2004 2003 Change % - ---------------------------------------------------------------------------------------------------------------- Office Equipment 13,638 14,436 -798 -5.5 Other Businesses 743 1,694 -951 -56.1 Corporate 717 466 251 53.9 - ---------------------------------------------------------------------------------------------------------------- Total 15,098 16,596 -1,498 -9.0 - ----------------------------------------------------------------------------------------------------------------
19
(Half year ended September 30, 2004 and 2003 and Year ended March 31, 2004) (Millions of yen) - -------------------------------------------------------------------------------------------------------------------------------- Half year Half year Year ended ended ended September 30, September 30, March 31, 2004 2003 Change % 2004 - -------------------------------------------------------------------------------------------------------------------------------- OFFICE EQUIPMENT: Net sales: Unaffiliated customers 765,965 775,508 -9,543 -1.2 1,557,633 Intersegment - - - - - Total 765,965 775,508 -9,543 -1.2 1,557,633 - -------------------------------------------------------------------------------------------------------------------------------- Operating expenses 683,759 672,809 10,950 1.6 1,353,304 - -------------------------------------------------------------------------------------------------------------------------------- Operating income 82,206 102,699 -20,493 -20.0 204,329 Operating income on office equipment sales(%) 10.7 13.2 13.1 - -------------------------------------------------------------------------------------------------------------------------------- OTHER BUSINESSES: Net sales: Unaffiliated customers 110,038 112,582 -2,544 -2.3 222,612 Intersegment 1,266 1,165 101 8.7 2,462 Total 111,304 113,747 -2,443 -2.1 225,074 - -------------------------------------------------------------------------------------------------------------------------------- Operating expenses 110,047 110,761 -714 -0.6 220,391 - -------------------------------------------------------------------------------------------------------------------------------- Operating income 1,257 2,986 -1,729 -57.9 4,683 Operating income on sales in other businesses (%) 1.1 2.6 2.1 - -------------------------------------------------------------------------------------------------------------------------------- CORPORATE AND ELIMINATIONS: Net sales: Intersegment -1,266 -1,165 -101 - -2,462 Total -1,266 -1,165 -101 - -2,462 - -------------------------------------------------------------------------------------------------------------------------------- Operating expenses: Intersegment -1,268 -1,195 -73 - -2,494 Corporate 25,707 28,460 -2,753 - 59,038 Total 24,439 27,265 -2,826 - 56,544 - -------------------------------------------------------------------------------------------------------------------------------- Operating income -25,705 -28,430 2,725 - -59,006 - -------------------------------------------------------------------------------------------------------------------------------- CONSOLIDATED: Net sales: Unaffiliated customers 876,003 888,090 -12,087 -1.4 1,780,245 Intersegment - - - - - Total 876,003 888,090 -12,087 -1.4 1,780,245 - -------------------------------------------------------------------------------------------------------------------------------- Operating expenses 818,245 810,835 7,410 0.9 1,630,239 - -------------------------------------------------------------------------------------------------------------------------------- Operating income 57,758 77,255 -19,497 -25.2 150,006 Operating income on consolidated net sales(%) 6.6 8.7 8.4 - --------------------------------------------------------------------------------------------------------------------------------
Identifiable assets: (Millions of yen) - -------------------------------------------------------------------------------------------------------------------------------- September 30, September 30, March 31, 2004 2003 Change % 2004 - -------------------------------------------------------------------------------------------------------------------------------- Office Equipment 1,233,319 1,196,927 36,392 3.0 1,220,747 Other Businesses 173,133 184,083 -10,950 -5.9 182,532 Elimination -9,185 -7,596 -1,589 20.9 -8,047 Corporate assets 480,188 538,748 -58,560 -10.9 457,561 - -------------------------------------------------------------------------------------------------------------------------------- Total 1,877,455 1,912,162 -34,707 -1.8 1,852,793 - --------------------------------------------------------------------------------------------------------------------------------
Capital expenditure: (Millions of yen) - -------------------------------------------------------------------------------------------------------------------------------- Half year Half year Year ended ended ended September 30, September 30, March 31, 2004 2003 Change % 2004 - -------------------------------------------------------------------------------------------------------------------------------- Office Equipment 34,297 31,938 2,359 7.4 65,366 Other Businesses 2,791 3,916 -1,125 -28.7 8,712 Corporate 1,149 480 669 139.4 1,429 - -------------------------------------------------------------------------------------------------------------------------------- Total 38,237 36,334 1,903 5.2 75,507 - --------------------------------------------------------------------------------------------------------------------------------
Depreciation: (Millions of yen) - ------------------------------------------------------------------------------------------------------------------------ Half year Half year Year ended ended ended September 30, September 30, March 31, 2004 2003 Change % 2004 - ------------------------------------------------------------------------------------------------------------------------ Office Equipment 27,440 29,378 -1,938 -6.6 57,956 Other Businesses 2,230 3,349 -1,119 -33.4 7,774 Corporate 1,371 895 476 53.2 1,954 - ------------------------------------------------------------------------------------------------------------------------ Total 31,041 33,622 -2,581 -7.7 67,684 - ------------------------------------------------------------------------------------------------------------------------
20 (2) Geographic Segment Information
(Three months ended September 30, 2004 and 2003) (Millions of yen) - ---------------------------------------------------------------------------------------------------------------------- Three months Three months ended ended September 30, September 30, 2004 2003 Change % - ---------------------------------------------------------------------------------------------------------------------- JAPAN: Net sales: External customers 241,810 240,584 1,226 0.5 Intersegment 93,541 87,257 6,284 7.2 Total 335,351 327,841 7,510 2.3 - ---------------------------------------------------------------------------------------------------------------------- Operating expenses 327,311 304,898 22,413 7.4 - ---------------------------------------------------------------------------------------------------------------------- Operating income 8,040 22,943 -14,903 -65.0 Operating income on sales in Japan(%) 2.4 7.0 - ---------------------------------------------------------------------------------------------------------------------- THE AMERICAS: Net sales: External customers 82,552 84,431 -1,879 -2.2 Intersegment 3,519 1,410 2,109 149.6 Total 86,071 85,841 230 0.3 - ---------------------------------------------------------------------------------------------------------------------- Operating expenses 81,812 80,451 1,361 1.7 - ---------------------------------------------------------------------------------------------------------------------- Operating income 4,259 5,390 -1,131 -21.0 Operating income on sales in the Americas(%) 4.9 6.3 - ---------------------------------------------------------------------------------------------------------------------- EUROPE: Net sales: External customers 93,315 97,797 -4,482 -4.6 Intersegment 848 715 133 18.6 Total 94,163 98,512 -4,349 -4.4 - ---------------------------------------------------------------------------------------------------------------------- Operating expenses 89,354 94,490 -5,136 -5.4 - ---------------------------------------------------------------------------------------------------------------------- Operating income 4,809 4,022 787 19.6 Operating income on sales in Europe(%) 5.1 4.1 - ---------------------------------------------------------------------------------------------------------------------- OTHER: Net sales: External customers 21,776 27,825 -6,049 -21.7 Intersegment 22,808 24,110 -1,302 -5.4 Total 44,584 51,935 -7,351 -14.2 - ---------------------------------------------------------------------------------------------------------------------- Operating expenses 41,549 49,722 -8,173 -16.4 - ---------------------------------------------------------------------------------------------------------------------- Operating income 3,035 2,213 822 37.1 Operating income on sales in other(%) 6.8 4.3 - ---------------------------------------------------------------------------------------------------------------------- CORPORATE AND ELIMINATIONS: Net sales: Intersegment -120,716 -113,492 -7,224 - Total -120,716 -113,492 -7,224 - - ---------------------------------------------------------------------------------------------------------------------- Operating expenses: -118,944 -117,695 -1,249 - - ---------------------------------------------------------------------------------------------------------------------- Operating income -1,772 4,203 -5,975 - - ---------------------------------------------------------------------------------------------------------------------- CONSOLIDATED: Net sales: External customers 439,453 450,637 -11,184 -2.5 Intersegment - - - - Total 439,453 450,637 -11,184 -2.5 - ---------------------------------------------------------------------------------------------------------------------- Operating expenses 421,082 411,866 9,216 2.2 - ---------------------------------------------------------------------------------------------------------------------- Operating income 18,371 38,771 -20,400 -52.6 Operating income on consolidated net sales(%) 4.2 8.6 - ----------------------------------------------------------------------------------------------------------------------
Identifiable assets: (Millions of yen) - ---------------------------------------------------------------------------------------------------------------------- September 30, September 30, 2004 2003 Change % - ---------------------------------------------------------------------------------------------------------------------- Japan 1,069,762 1,061,188 8,574 0.8 The Americas 205,198 192,700 12,498 6.5 Europe 206,108 186,650 19,458 10.4 Other 60,406 69,154 -8,748 -12.7 Elimination -144,207 -136,278 -7,929 5.8 Corporate assets 480,188 538,748 -58,560 -10.9 - ---------------------------------------------------------------------------------------------------------------------- Total 1,877,455 1,912,162 -34,707 -1.8 - ----------------------------------------------------------------------------------------------------------------------
21
(Half year ended September 30, 2004 and 2003 and Year ended March 31, 2004) (Millions of yen) - ------------------------------------------------------------------------------------------------------------------------------ Half year Half year Year ended ended ended September 30, September 30, March 31, 2004 2003 Change % 2004 - ------------------------------------------------------------------------------------------------------------------------------ JAPAN: Net sales: External customers 481,473 478,922 2,551 0.5 962,127 Intersegment 189,951 184,331 5,620 3.0 351,070 Total 671,424 663,253 8,171 1.2 1,313,197 - ------------------------------------------------------------------------------------------------------------------------------ Operating expenses 631,732 606,466 25,266 4.2 1,215,875 - ------------------------------------------------------------------------------------------------------------------------------ Operating income 39,692 56,787 -17,095 -30.1 97,322 Operating income on sales in Japan(%) 5.9 8.6 7.4 - ------------------------------------------------------------------------------------------------------------------------------ THE AMERICAS: Net sales: External customers 159,184 161,965 -2,781 -1.7 315,504 Intersegment 4,814 2,992 1,822 60.9 5,249 Total 163,998 164,957 -959 -0.6 320,753 - ------------------------------------------------------------------------------------------------------------------------------ Operating expenses 157,865 157,274 591 0.4 305,284 - ------------------------------------------------------------------------------------------------------------------------------ Operating income 6,133 7,683 -1,550 -20.2 15,469 Operating income on sales in the Americas(%) 3.7 4.7 4.8 - ------------------------------------------------------------------------------------------------------------------------------ EUROPE: Net sales: External customers 193,941 196,560 -2,619 -1.3 400,646 Intersegment 1,789 1,771 18 1.0 3,770 Total 195,730 198,331 -2,601 -1.3 404,416 - ------------------------------------------------------------------------------------------------------------------------------ Operating expenses 184,768 188,819 -4,051 -2.1 382,383 - ------------------------------------------------------------------------------------------------------------------------------ Operating income 10,962 9,512 1,450 15.2 22,033 Operating income on sales in Europe(%) 5.6 4.8 5.4 - ------------------------------------------------------------------------------------------------------------------------------ OTHER: Net sales: External customers 41,405 50,643 -9,238 -18.2 101,968 Intersegment 43,818 49,225 -5,407 -11.0 91,373 Total 85,223 99,868 -14,645 -14.7 193,341 - ------------------------------------------------------------------------------------------------------------------------------ Operating expenses 79,788 95,302 -15,514 -16.3 182,870 - ------------------------------------------------------------------------------------------------------------------------------ Operating income 5,435 4,566 869 19.0 10,471 Operating income on sales in other(%) 6.4 4.6 5.4 - ------------------------------------------------------------------------------------------------------------------------------ CORPORATE AND ELIMINATIONS: Net sales: Intersegment -240,372 -238,319 -2,053 - -451,462 Total -240,372 -238,319 -2,053 - -451,462 - ------------------------------------------------------------------------------------------------------------------------------ Operating expenses: -235,908 -237,026 1,118 - -456,173 - ------------------------------------------------------------------------------------------------------------------------------ Operating income -4,464 -1,293 -3,171 - 4,711 - ------------------------------------------------------------------------------------------------------------------------------ CONSOLIDATED: Net sales: External customers 876,003 888,090 -12,087 -1.4 1,780,245 Intersegment - - - - - Total 876,003 888,090 -12,087 -1.4 1,780,245 - ------------------------------------------------------------------------------------------------------------------------------ Operating expenses 818,245 810,835 7,410 0.9 1,630,239 - ------------------------------------------------------------------------------------------------------------------------------ Operating income 57,758 77,255 -19,497 -25.2 150,006 Operating income on consolidated net sales(%) 6.6 8.7 8.4 - ------------------------------------------------------------------------------------------------------------------------------
Identifiable assets: (Millions of yen) - ------------------------------------------------------------------------------------------------------------------------------ September 30, September 30, March 31, 2004 2003 Change % 2004 - ------------------------------------------------------------------------------------------------------------------------------ Japan 1,069,762 1,061,188 8,574 0.8 1,071,297 The Americas 205,198 192,700 12,498 6.5 188,644 Europe 206,108 186,650 19,458 10.4 188,184 Other 60,406 69,154 -8,748 -12.7 63,701 Elimination -144,207 -136,278 -7,929 5.8 -116,594 Corporate assets 480,188 538,748 -58,560 -10.9 457,561 - ------------------------------------------------------------------------------------------------------------------------------ Total 1,877,455 1,912,162 -34,707 -1.8 1,852,793 - ------------------------------------------------------------------------------------------------------------------------------
22 7. SIGNIFICANT ACCOUNTING POLICIES (CONSOLIDATED) 1. CHANGE RELATING TO THE SCALE OF CONSOLIDATION AND THE APPLICATION OF THE EQUITY METHOD FROM APRIL 1, 2004 TO SEPTEMBER 30, 2004. Consolidated subsidiaries: Addition: MASANA OFFICE SOLUTIONS (PTY) LIMITED 31 removals including HANIMEX AUSTRALASIA PTY LTD. Companies accounted for by the equity method: 3 Additions including TRIANGLE SPIRIT CORPORATION Removal: FOTO ISLAND (NSW) PTY. LTD. 2. CONSOLIDATED ACCOUNTING POLICIES (SUMMARY) (1) Principles of Consolidation The consolidated financial statements include the accounts of Ricoh and its consolidated subsidiaries. Investments in 20% to 50% owned companies when the company has the ability to exercise significant influence are accounted for on the equity basis. All significant inter-company balances and transactions have been eliminated in consolidation. Certain overseas subsidiaries of the company changed their fiscal year end from December 31 to March 31, at the beginning of fiscal 2005. As a result, retained earnings increased by Yen 777 million and other comprehensive income (loss) decreased by Yen 1,665 million. (2) Securities In conformity with SFAS No.115, securities are mainly classified as available-for-sale securities. Available-for-sale securities are reported at fair value with unrealized gains and losses, net of related taxes, excluded from earnings and reported in accumulated other comprehensive income (loss). The cost of the securities sold is computed based on the average cost of each security held at the time of sale. (3) Inventories Inventories are mainly stated at the lower of average cost or market. Inventory costs include raw materials, labor and manufacturing overheads. (4) Plant and Equipment Depreciation of plant and equipment is computed principally by using the declining-balance method over the estimated useful lives. Most of the foreign subsidiaries have adopted the straight-line method for computing depreciation. Certain leased buildings, machinery and equipment are accounted for as capital leases in conformity with SFAS No. 13, "Accounting for Leases." (5) Goodwill and Other Intangible Assets In conformity with SFAS No.142, Goodwill and intangible asset determined to have an indefinite useful life are not amortized. SFAS No. 142 requires annual impairment testing thereof. (6) Use of Estimates Management of the Company has made a number of estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses, including impairment losses of long-lived assets and the disclosures of fair value of financial instruments and contingent assets and liabilities, to prepare these financial statements in conformity with generally accepted accounting principles. Actual results could differ from those estimates. 23 8. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (1) FAIR VALUE OF MARKETABLE SECURITIES The securities and the respective cost, gross unrealized holding gains, gross unrealized holding losses and fair value as of September 30, 2004 and March 31, 2004 are as follows:
(Millions of yen) - ---------------------------------------------------------------------------------------------------------------- September 30, 2004 - ---------------------------------------------------------------------------------------------------------------- Gross Gross unrealized unrealized holding holding Cost gains losses Fair value - ---------------------------------------------------------------------------------------------------------------- Current: Corporate debt securities 51,137 2 21 51,118 Other 1 - - 1 - ---------------------------------------------------------------------------------------------------------------- 51,138 2 21 51,119 - ---------------------------------------------------------------------------------------------------------------- Noncurrent: Equity securities 5,088 7,047 52 12,083 Other 1,309 407 - 1,716 Nonmarketable securities (at cost) 7,047 - - 7,047 - ---------------------------------------------------------------------------------------------------------------- 13,444 7,454 52 20,846 - ----------------------------------------------------------------------------------------------------------------
(Millions of yen) - --------------------------------------------------------------------------------------------------------------- March 31, 2004 - --------------------------------------------------------------------------------------------------------------- Gross Gross unrealized unrealized holding holding Cost gains losses Fair value - --------------------------------------------------------------------------------------------------------------- Current: Corporate debt securities 45,139 6 22 45,123 Other 1 - - 1 - ---------------------------------------------------------------------------------------------------------------- 45,140 6 22 45,124 - ---------------------------------------------------------------------------------------------------------------- Noncurrent: Equity securities 5,053 8,080 33 13,100 Other 1,174 492 - 1,666 Nonmarketable securities (at cost) 7,105 - - 7,105 - ---------------------------------------------------------------------------------------------------------------- 13,332 8,572 33 21,871 - ----------------------------------------------------------------------------------------------------------------
(2) DERIVATIVES The Company and certain of its subsidiaries enter into various financial instrument contracts in the normal course of business and in connection with the management of their assets and liabilities. The outstanding agreements, carrying amount and estimated fair value of derivative financial instruments as of September 30, 2004, and March 31, 2004 are as follows:
(Millions of yen) - ------------------------------------------------------------------------------------------------ September 30, 2004 - ------------------------------------------------------------------------------------------------ Carrying Estimated amount Fair value - ------------------------------------------------------------------------------------------------ Interest rate swap agreements, net 1,864 1,864 Foreign currency contracts-net credit 253 253 Currency options-net credit -332 -332 - ------------------------------------------------------------------------------------------------ Total 1,785 1,785 - ------------------------------------------------------------------------------------------------
(Millions of yen) - ------------------------------------------------------------------------------------------------ March 31, 2004 - ------------------------------------------------------------------------------------------------ Carrying Estimated amount Fair value - ------------------------------------------------------------------------------------------------ Interest rate swap agreements, net 2,266 2,266 Foreign currency contracts-net credit 1,876 1,876 Currency options -145 -145 - ------------------------------------------------------------------------------------------------ Total 3,997 3,997 - ------------------------------------------------------------------------------------------------
(3) TRANSACTIONS OF RICOH WITH AFFILIATES
(Millions of yen) - ---------------------------------------------------------------------------------------- September 30, March 31, 2004 2004 - ---------------------------------------------------------------------------------------- Account balances: Receivables 4,524 3,530 Payables 3,083 2,217 - ----------------------------------------------------------------------------------------
(Millions of yen) - ---------------------------------------------------------------------------------------- Half year ended Year ended September 30, March 31, 2004 2004 - ---------------------------------------------------------------------------------------- Transactions: Sales 10,133 19,534 Purchases 14,386 18,714 Dividend income 803 1,064 - ----------------------------------------------------------------------------------------
24 - -APPENDIX- (Half year ended September 30, 2004) 1. CONSOLIDATED SALES BY PRODUCT CATEGORY
(Three months ended September 30, 2004 and 2003) (Millions of yen) - -------------------------------------------------------------------------------------------------------------------------- Three months Three months Change ended ended excluding September 30, September 30, exchange 2004 2003 Change % impact % - -------------------------------------------------------------------------------------------------------------------------- [Office Equipment] Imaging Solutions: Digital Imaging Systems 136,148 150,161 -14,013 -9.3 -11,279 -7.5 Percentage of net sales (%) 31.0 33.3 Domestic 54,818 58,879 -4,061 -6.9 -4,061 -6.9 Overseas 81,330 91,282 -9,952 -10.9 -7,218 -7.9 Other Imaging Systems 38,828 52,165 -13,337 -25.6 -12,744 -24.4 Percentage of net sales (%) 8.8 11.6 Domestic 14,917 17,215 -2,298 -13.3 -2,298 -13.3 Overseas 23,911 34,950 -11,039 -31.6 -10,446 -29.9 Total Imaging Solutions 174,976 202,326 -27,350 -13.5 -24,023 -11.9 Percentage of net sales (%) 39.8 44.9 Domestic 69,735 76,094 -6,359 -8.4 -6,359 -8.4 Overseas 105,241 126,232 -20,991 -16.6 -17,664 -14.0 - -------------------------------------------------------------------------------------------------------------------------- Network Input/Output Systems: Printing Systems 149,373 117,351 32,022 27.3 34,107 29.1 Percentage of net sales (%) 34.0 26.0 Domestic 61,260 47,893 13,367 27.9 13,367 27.9 Overseas 88,113 69,458 18,655 26.9 20,740 29.9 Other Input/Output Systems 3,594 18,304 -14,710 -80.4 -14,732 -80.5 Percentage of net sales (%) 0.8 4.1 Domestic 551 1,101 -550 -50.0 -550 -50.0 Overseas 3,043 17,203 -14,160 -82.3 -14,182 -82.4 Total Network Input/Output Systems 152,967 135,655 17,312 12.8 19,375 14.3 Percentage of net sales (%) 34.8 30.1 Domestic 61,811 48,994 12,817 26.2 12,817 26.2 Overseas 91,156 86,661 4,495 5.2 6,558 7.6 - -------------------------------------------------------------------------------------------------------------------------- Network System Solutions 54,049 53,795 254 0.5 283 0.5 Percentage of net sales (%) 12.3 11.9 Domestic 52,538 52,593 -55 -0.1 -55 -0.1 Overseas 1,511 1,202 309 25.7 338 28.1 - -------------------------------------------------------------------------------------------------------------------------- Office Equipment Total 381,992 391,776 -9,784 -2.5 -4,365 -1.1 Percentage of net sales (%) 86.9 86.9 Domestic 184,084 177,681 6,403 3.6 6,403 3.6 Overseas 197,908 214,095 -16,187 -7.6 -10,768 -5.0 The Americas 82,719 87,892 -5,173 -5.9 542 0.6 Europe 91,678 97,087 -5,409 -5.6 -6,507 -6.7 Other 23,511 29,116 -5,605 -19.3 -4,803 -16.5 - -------------------------------------------------------------------------------------------------------------------------- [Other Businesses] Other Businesses 57,461 58,861 -1,400 -2.4 -1,263 -2.1 Percentage of net sales (%) 13.1 13.1 Domestic 51,780 46,620 5,160 11.1 5,160 11.1 Overseas 5,681 12,241 -6,560 -53.6 -6,423 -52.5 The Americas 210 281 -71 -25.3 -57 -20.3 Europe 986 1,245 -259 -20.8 -271 -21.8 Other 4,485 10,715 -6,230 -58.1 -6,095 -56.9 - -------------------------------------------------------------------------------------------------------------------------- Grand Total 439,453 450,637 -11,184 -2.5 -5,628 -1.2 Percentage of net sales (%) 100.0 100.0 Domestic 235,864 224,301 11,563 5.2 11,563 5.2 Percentage of net sales (%) 53.7 49.8 Overseas 203,589 226,336 -22,747 -10.1 -17,191 -7.6 Percentage of net sales (%) 46.3 50.2 The Americas 82,929 88,173 -5,244 -5.9 485 0.6 Percentage of net sales (%) 18.9 19.6 Europe 92,664 98,332 -5,668 -5.8 -6,778 -6.9 Percentage of net sales (%) 21.1 21.8 Other 27,996 39,831 -11,835 -29.7 -10,898 -27.4 Percentage of net sales (%) 6.3 8.8 - -------------------------------------------------------------------------------------------------------------------------- Reference: Exchange rate US$ 1 Yen 110.01 Yen 117.61 Yen -7.60 EURO 1 Yen 134.44 Yen 132.27 Yen 2.17
Each category includes the following product line: Digital Imaging Systems Digital PPCs, color PPCs, digital duplicators and facsimile machines Other Imaging Systems Analog PPCs, diazo copiers, and thermal paper Printing Systems MFPs(multifunctional printers), laser printers and software Other Input/Output Systems Optical discs and system scanners Network System Solutions Personal computers, PC servers, network systems and network related software Other Businesses Optical equipments, metering equipments and semiconductors A1
(Half year ended September 30, 2004 and 2003 and Year ended March 31, 2004) (Millions of yen) - ----------------------------------------------------------------------------------------------------------------------------------- Half year Half year Change ended ended excluding Year ended September 30, September 30, exchange March 31, 2004 2003 Change % impact % 2004 - ----------------------------------------------------------------------------------------------------------------------------------- [Office Equipment] Imaging Solutions: Digital Imaging Systems 275,531 309,158 -33,627 -10.9 -27,602 -8.9 606,270 Percentage of net sales (%) 31.5 34.8 34.1 Domestic 113,924 124,773 -10,849 -8.7 -10,849 -8.7 253,830 Overseas 161,607 184,385 -22,778 -12.4 -16,753 -9.1 352,440 Other Imaging Systems 81,074 105,936 -24,862 -23.5 -23,519 -22.2 197,304 Percentage of net sales (%) 9.2 11.9 11.0 Domestic 30,912 36,497 -5,585 -15.3 -5,585 -15.3 70,762 Overseas 50,162 69,439 -19,277 -27.8 -17,934 -25.8 126,542 Total Imaging Solutions 356,605 415,094 -58,489 -14.1 -51,121 -12.3 803,574 Percentage of net sales (%) 40.7 46.7 45.1 Domestic 144,836 161,270 -16,434 -10.2 -16,434 -10.2 324,592 Overseas 211,769 253,824 -42,055 -16.6 -34,687 -13.7 478,982 - ----------------------------------------------------------------------------------------------------------------------------------- Network Input/Output Systems: Printing Systems 301,343 233,457 67,886 29.1 72,179 30.9 509,212 Percentage of net sales (%) 34.4 26.3 28.6 Domestic 127,975 100,351 27,624 27.5 27,624 27.5 218,165 Overseas 173,368 133,106 40,262 30.2 44,555 33.5 291,047 Other Input/Output Systems 8,979 29,725 -20,746 -69.8 -20,728 -69.7 49,025 Percentage of net sales (%) 1.0 3.3 2.8 Domestic 1,490 2,743 -1,253 -45.7 -1,253 -45.7 4,981 Overseas 7,489 26,982 -19,493 -72.2 -19,475 -72.2 44,044 Total Network Input/Output Systems 310,322 263,182 47,140 17.9 51,451 19.5 558,237 Percentage of net sales (%) 35.4 29.6 31.4 Domestic 129,465 103,094 26,371 25.6 26,371 25.6 223,146 Overseas 180,857 160,088 20,769 13.0 25,080 15.7 335,091 - ----------------------------------------------------------------------------------------------------------------------------------- Network System Solutions 99,038 97,232 1,806 1.9 1,864 1.9 195,822 Percentage of net sales (%) 11.3 11.0 11.0 Domestic 96,115 95,260 855 0.9 855 0.9 191,302 Overseas 2,923 1,972 951 48.2 1,009 51.2 4,520 - ----------------------------------------------------------------------------------------------------------------------------------- Office Equipment Total 765,965 775,508 -9,543 -1.2 2,194 0.3 1,557,633 Percentage of net sales (%) 87.4 87.3 87.5 Domestic 370,416 359,624 10,792 3.0 10,792 3.0 739,040 Overseas 395,549 415,884 -20,335 -4.9 -8,598 -2.1 818,593 The Americas 160,944 166,800 -5,856 -3.5 6,045 3.6 325,106 Europe 191,189 194,700 -3,511 -1.8 -5,090 -2.6 398,109 Other 43,416 54,384 -10,968 -20.2 -9,553 -17.6 95,378 - ----------------------------------------------------------------------------------------------------------------------------------- [Other Businesses] Other Businesses 110,038 112,582 -2,544 -2.3 -2,214 -2.0 222,612 Percentage of net sales (%) 12.6 12.7 12.5 Domestic 98,760 89,012 9,748 11.0 9,748 11.0 175,020 Overseas 11,278 23,570 -12,292 -52.2 -11,962 -50.8 47,592 The Americas 386 864 -478 -55.3 -450 -52.1 1,274 Europe 1,798 2,251 -453 -20.1 -452 -20.1 4,283 Other 9,094 20,455 -11,361 -55.5 -11,060 -54.1 42,035 - ----------------------------------------------------------------------------------------------------------------------------------- Grand Total 876,003 888,090 -12,087 -1.4 -20 0.0 1,780,245 Percentage of net sales (%) 100.0 100.0 100.0 Domestic 469,176 448,636 20,540 4.6 20,540 4.6 914,060 Percentage of net sales (%) 53.6 50.5 51.3 Overseas 406,827 439,454 -32,627 -7.4 -20,560 -4.7 866,185 Percentage of net sales (%) 46.4 49.5 48.7 The Americas 161,330 167,664 -6,334 -3.8 5,595 3.3 326,380 Percentage of net sales (%) 18.4 18.9 18.3 Europe 192,987 196,951 -3,964 -2.0 -5,542 -2.8 402,392 Percentage of net sales (%) 22.0 22.2 22.6 Other 52,510 74,839 -22,329 -29.8 -20,613 -27.5 137,413 Percentage of net sales (%) 6.0 8.4 7.8 - ----------------------------------------------------------------------------------------------------------------------------------- Reference: Exchange rate US$ 1 Yen 109.83 Yen 118.06 Yen -8.23 Yen 113.09 EURO 1 Yen 133.31 Yen 133.47 Yen -0.16 Yen 132.65
Each category includes the following product line: Digital Imaging Systems Digital PPCs, color PPCs, digital duplicators and facsimile machines Other Imaging Systems Analog PPCs, diazo copiers, and thermal paper Printing Systems MFPs(multifunctional printers), laser printers and software Other Input/Output Systems Optical discs and system scanners Network System Solutions Personal computers, PC servers, network systems and network related software Other Businesses Optical equipments, metering equipments and semiconductors A2 2. FORECAST OF CONSOLIDATED PERFORMANCE
(Billions of yen) - ---------------------------------------------------------------------------------------------------------------------------------- Half year Three months Half year ended ending ending Year ending Sept. 30, 2004 Change Dec. 31, 2004 Change Mar. 31, 2005 Change Mar. 31, 2005 Change Results % Forecast % Forecast % Forecast % - ---------------------------------------------------------------------------------------------------------------------------------- Net sales 876.0 -1.4 437.6 4.0 933.9 4.7 1,810.0 1.7 Gross profit 363.8 -6.2 187.9 1.1 396.1 4.9 760.0 -0.7 Operating income 57.7 -25.2 39.7 9.6 93.2 28.2 151.0 0.7 Income before income taxes 60.0 -15.9 38.7 16.3 85.4 19.2 145.5 1.7 Net income 35.8 -15.2 22.5 14.4 49.1 -0.7 85.0 -7.4 - ---------------------------------------------------------------------------------------------------------------------------------- Net income per share (yen) 48.48 - 30.46 - 66.57 - 115.05 - - ---------------------------------------------------------------------------------------------------------------------------------- Capital expenditure 38.2 - 18.5 - 37.7 - 76.0 - Depreciation for tangible fixed assets 31.0 - 19.5 - 38.9 - 70.0 - R&D expenditure 53.4 - 26.8 - 53.5 - 107.0 - - ---------------------------------------------------------------------------------------------------------------------------------- Exchange rate (Yen/US$) 109.83 - 105.00 - 105.00 - 107.42 - Exchange rate (Yen/EURO) 133.31 - 130.00 - 130.00 - 131.66 - - ----------------------------------------------------------------------------------------------------------------------------------
3. FORECAST OF CONSOLIDATED SALES BY PRODUCT CATEGORY
(Billions of yen) - ------------------------------------------------------------------------------------------------------------------------------- Half year ending March 31, 2005 Year ending March 31, 2005 ---------------------------------------------- --------------------------------------------- Change Change Change Change Forecast % Forecast(*) % Forecast % Forecast(*) % - ------------------------------------------------------------------------------------------------------------------------------- [Office Equipment] Imaging Solutions: Digital Imaging Systems 267.8 -9.9 269.4 -9.3 543.3 -10.4 551.0 -9.1 Domestic 116.0 -10.1 116.0 -10.1 230.0 -9.4 230.0 -9.4 Overseas 151.7 -9.7 153.3 -8.7 313.3 -11.1 321.0 -8.9 Other Imaging Systems 73.5 -19.5 74.4 -18.5 154.5 -21.6 156.9 -20.5 Domestic 29.3 -14.2 29.3 -14.2 60.3 -14.8 60.3 -14.8 Overseas 44.1 -22.7 45.0 -21.0 94.2 -25.5 96.6 -23.7 Total Imaging Solutions 341.3 -12.1 343.9 -11.5 697.9 -13.1 707.9 -11.9 Domestic 145.4 -10.9 145.4 -10.9 290.3 -10.6 290.3 -10.6 Overseas 195.8 -13.0 198.4 -11.9 407.6 -14.9 417.6 -12.8 - ------------------------------------------------------------------------------------------------------------------------------- Network Input/Output Systems: Printing Systems 377.5 36.9 382.8 38.8 678.9 33.3 688.4 35.2 Domestic 160.7 36.4 160.7 36.4 288.7 32.3 288.7 32.3 Overseas 216.8 37.3 222.0 40.6 390.2 34.1 399.7 37.4 Other Input/Output Systems 7.9 -58.9 8.2 -57.3 16.9 -65.5 17.2 -64.9 Domestic 1.2 -45.9 1.2 -45.9 2.7 -45.8 2.7 -45.8 Overseas 6.7 -60.6 7.0 -58.8 14.2 -67.7 14.5 -67.0 Total Network Input/Output Systems 385.5 30.7 391.0 32.5 695.8 24.6 705.6 26.4 Domestic 161.9 34.9 161.9 34.9 291.4 30.6 291.4 30.6 Overseas 223.5 27.8 229.1 30.9 404.4 20.7 414.2 23.6 - ------------------------------------------------------------------------------------------------------------------------------- Network System Solutions 99.3 0.8 99.5 0.9 198.4 1.3 198.6 1.4 Domestic 95.1 -0.9 95.1 -0.9 191.3 -0.0 191.3 -0.0 Overseas 4.2 65.0 4.3 69.5 7.1 57.7 7.3 61.5 - ------------------------------------------------------------------------------------------------------------------------------- Office Equipment Total 826.2 5.6 834.4 6.7 1,592.2 2.2 1,612.1 3.5 Domestic 402.5 6.1 402.5 6.1 773.0 4.6 773.0 4.6 Overseas 423.6 5.2 431.9 7.2 819.2 0.1 839.1 2.5 The Americas 165.4 4.5 170.3 7.6 326.4 0.4 343.1 5.6 Europe 211.9 4.2 215.0 5.7 403.1 1.3 404.7 1.7 Other 46.1 12.7 46.4 13.4 89.6 -6.0 91.3 -4.2 - ------------------------------------------------------------------------------------------------------------------------------- [Other Businesses] Other Businesses 107.7 -2.1 107.9 -1.9 217.8 -2.2 218.3 -1.9 Domestic 95.6 11.2 95.6 11.2 194.4 11.1 194.4 11.1 Overseas 12.1 -49.5 12.2 -48.8 23.4 -50.8 23.9 -49.8 The Americas 0.8 109.8 0.8 116.1 1.2 -2.2 1.3 2.0 Europe 3.1 55.4 3.2 57.5 4.9 15.7 5.0 16.7 Other 8.1 -62.4 8.2 -62.0 17.1 -59.1 17.6 -58.1 - ------------------------------------------------------------------------------------------------------------------------------- Grand Total 933.9 4.7 942.4 5.6 1,810.0 1.7 1,830.4 2.8 Domestic 498.2 7.0 498.2 7.0 967.4 5.8 967.4 5.8 Overseas 435.7 2.1 444.1 4.1 842.6 -2.7 863.0 -0.4 The Americas 166.3 4.8 171.2 7.9 327.6 0.4 344.4 5.5 Europe 215.1 4.7 218.2 6.3 408.1 1.4 409.7 1.8 Other 54.3 -13.2 54.7 -12.6 106.8 -22.3 108.9 -20.7 - -------------------------------------------------------------------------------------------------------------------------------
A3 - -APPENDIX B-
[SCHEDULE 1] CONSOLIDATED PERFORMANCE - ------------------------------------------------------------------------------------------------------------------------ Half year Half year Half year Half year Half year ended ended ended ended ended September 30, September 30, September 30, September 30, September 30, 2000 2001 2002 2003 2004 - ------------------------------------------------------------------------------------------------------------------------ Net sales (Billions of yen) 735.3 820.0 856.8 888.0 876.0 Net income (Billions of yen) 25.8 28.4 33.5 42.2 35.8 Return on equity (%) 4.7 5.0 5.2 6.2 4.4 Return on assets (%) 3.0 3.1 3.0 3.8 3.2 Net income per share (Yen) 37.27 40.97 46.11 56.79 48.48 - ------------------------------------------------------------------------------------------------------------------------
[SCHEDULE 2] CONSOLIDATED SALES BY PRODUCT LINE - -------------------------------------------------------------------------------------------------------------------------------- Half year Half year Half year Half year Half year ended ended ended ended ended September 30, September 30, September 30, September 30, September 30, 2000 2001 2002 2003 2004 - -------------------------------------------------------------------------------------------------------------------------------- Imaging solutions (Billions of yen) 422.2 458.3 430.3 415.0 356.6 Networking I/O systems (Billions of yen) 108.6 168.3 218.9 263.1 310.3 Network system solutions (Billions of yen) 100.4 102.9 100.0 97.2 99.0 Other Businesses (Billions of yen) 103.8 90.5 107.4 112.5 110.0 - -------------------------------------------------------------------------------------------------------------------------------- Imaging solutions (%) 57.4 55.9 50.2 46.7 40.7 Networking I/O systems (%) 14.8 20.5 25.6 29.6 35.4 Network system solutions (%) 13.7 12.6 11.7 11.0 11.3 Other Businesses (%) 14.1 11.0 12.5 12.7 12.6 Total 100.0 100.0 100.0 100.0 100.0 - --------------------------------------------------------------------------------------------------------------------------------
[SCHEDULE 3] CONSOLIDATED SALES BY GEOGRAPHIC AREA - -------------------------------------------------------------------------------------------------------------------------------- Half year Half year Half year Half year Half year ended ended ended ended ended September 30, September 30, September 30, September 30, September 30, 2000 2001 2002 2003 2004 - -------------------------------------------------------------------------------------------------------------------------------- Japan (Billions of yen) 456.1 452.7 449.5 448.6 469.1 The Americas (Billions of yen) 112.4 162.6 170.4 167.6 161.3 Europe (Billions of yen) 117.1 148.1 166.1 196.9 192.9 Others (Billions of yen) 49.5 56.5 70.6 74.8 52.5 - -------------------------------------------------------------------------------------------------------------------------------- Japan (%) 62.0 55.2 52.5 50.5 53.6 The Americas (%) 15.3 19.8 19.9 18.9 18.4 Europe (%) 16.0 18.1 19.4 22.2 22.0 Others (%) 6.7 6.9 8.2 8.4 6.0 Total 100.0 100.0 100.0 100.0 100.0 - --------------------------------------------------------------------------------------------------------------------------------
A4 -----END PRIVACY-ENHANCED MESSAGE-----