-----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, VgTKxeFMU6K4QzoefstU5OOAgJ7fcVJNTpuijU9mME6Au0BpbzuwJzBidsjJkAmF qwH67RmSnULXmSk+I3atVQ== 0000317891-05-000006.txt : 20050427 0000317891-05-000006.hdr.sgml : 20050427 20050427060625 ACCESSION NUMBER: 0000317891-05-000006 CONFORMED SUBMISSION TYPE: 6-K PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 20050203 FILED AS OF DATE: 20050427 DATE AS OF CHANGE: 20050427 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: 05774530 BUSINESS ADDRESS: STREET 1: 15-5 1-CHOME MINAMI-AOYAMA STREET 2: MINATO-KU CITY: TOKYO 107-8544 JAPAN STATE: M0 ZIP: 00000 BUSINESS PHONE: 81-3-5411-4744 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 r6kh17feb03.txt QUARTERLY REPORT 12-31-2004 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 February, 2005 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 February 3, 2005 - -------------------------------------------------------------------------------- RICOH February 3, 2005 QUARTERLY REPORT Third Quarter Ended December 31, 2004 (Results for the Period from October 1, 2004 to December 31, 2004) PERFORMANCE OUTLINE (CONSOLIDATED) (1) Three Months Ended December 31, 2004 and 2003
(Billions of yen) - -------------------------------------------------------------------------------------------- Three months ended Three months ended December 31, 2004 December 31, 2003 Change - -------------------------------------------------------------------------------------------- Domestic sales 231.3 212.9 8.6% Overseas sales 212.4 207.9 2.2% Net sales 443.7 420.9 5.4% Gross profit 192.1 185.7 3.4% Operating income 38.7 36.2 6.9% Income before income taxes 34.6 33.2 4.2% Net income 22.2 19.6 13.0% - ------------------------------------------------------------------------------------------- Exchange rate (Yen/US$) 106.01 108.92 -2.91 Exchange rate (Yen/EURO) 137.16 129.58 7.58 - ------------------------------------------------------------------------------------------- Net income per share (yen) 30.08 26.53 3.55 - ------------------------------------------------------------------------------------------- Capital expenditures 20.5 15.5 4.9 Depreciation for tangible fixed assets 16.9 15.7 1.2 R&D expenditures 26.1 24.2 1.9 - -------------------------------------------------------------------------------------------
(2) Nine Months Ended December 31, 2004, 2003 and Year Ending March 31, 2005
(Billions of yen) - -------------------------------------------------------------------------------------------- ---------------------------------- Nine months ended Nine months ended Year ending December 31, 2004 December 31, 2003 Change March 31, 2005 Change (Results) (Results) (Forecast) - -------------------------------------------------------------------------------------------- ---------------------------------- Domestic sales 700.4 661.5 5.9% 972.9 6.4% Overseas sales 619.3 647.4 -4.3% 842.1 -2.8% Net sales 1,319.8 1,308.9 0.8% 1,815.0 2.0% Gross profit 555.9 573.8 -3.1% 764.0 -0.2% Operating income 96.4 113.4 -15.0% 147.0 -2.0% Income before income taxes 94.7 104.6 -9.5% 141.0 -1.4% Net income 58.0 61.9 -6.3% 85.0 -7.4% - -------------------------------------------------------------------------------------------- ---------------------------------- Exchange rate (Yen/US$) 108.55 115.00 -6.45 107.67 -5.42 Exchange rate (Yen/EURO) 134.60 132.17 2.43 133.45 0.80 - -------------------------------------------------------------------------------------------- --------------------------------- Net income per share (yen) 78.56 83.32 -4.76 115.07 -8.56 - -------------------------------------------------------------------------------------------- --------------------------------- Total assets 1,899.8 1,922.1 -22.2 - - Shareholders' equity 841.9 708.8 133.1 - - Interest-bearing debt 446.4 513.1 -66.6 - - - -------------------------------------------------------------------------------------------- --------------------------------- Equity ratio (%) 44.3 36.9 7.4 - - - -------------------------------------------------------------------------------------------- --------------------------------- Shareholder's equity per share (yen) 1,139.87 958.20 181.67 - - - -------------------------------------------------------------------------------------------- --------------------------------- Cash flows from operating activities 74.3 81.6 -7.3 - - Cash flows from investing activities -90.5 -40.4 -50.1 - - Cash flows from financing activities -22.9 9.2 -32.1 - - Cash and cash equivalents at end of period 168.1 238.3 -70.2 - - - -------------------------------------------------------------------------------------------- --------------------------------- Capital expenditures 58.7 51.8 6.8 79.0 0.4 Depreciation for tangible fixed assets 48.0 49.4 -1.3 67.5 -0.1 R&D expenditures 79.6 68.4 11.1 107.0 14.4 - -------------------------------------------------------------------------------------------- ----------------------------------
RICOH COMPANY, LTD. * The Company bases the forecast estimates for the year ending 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 PERFORMANCE *Overview Consolidated net sales for the third quarter of fiscal 2005 (the three months period from October 1 to December 31, 2004) increased by 5.4% as compared to the previous corresponding period, to Yen 443.7 billion. During this quarter, the average yen exchange rates were at Yen 106.01 against the U.S. dollar (up Yen 2.91) and Yen 137.16 against the euro (down Yen 7.58). Net sales would rise 4.8% excluding impacts of such foreign currency exchange fluctuations. In Japan, Printing Systems such as MFPs (multifunctional printers) and laser printers increased its sales, and also solution business such as support and service continued its sales raised. Moreover, Ricoh Printing Systems, Ltd. which is a newly acquired printing company contributed substantially to our sales. In the result of taking effective countermeasures against the changes in terms of multifunction, networking and colorizing, net sales was 8.6% up from the previous corresponding period. As for overseas, product categories such as color PPCs (plain paper copiers), MFPs and laser printers, especially color models, increased its sales in each region. Although sales in the Americas increased by 3.0% (5.9% increase excluding currency exchange impact) and in Europe also increased by 8.2% as compared to the previous corresponding period, sales in other region such as China, Asian and Oceania countries decreased by 18.4% due primarily to sales decline of optical disc business and the sale of certain consolidated subsidiaries in optical related business. As a result, net sales was 2.2% up from the previous corresponding period. Excluding the impact of the currency exchange fluctuations, it figures net sales would be increased by 0.9%. Operating income increased by 6.9% as compared to the previous corresponding period, to Yen 38.7 billion. It was provided positive effect by increasing of sales on high value-added products such as color PPCs, MFPs and printers that yield a high profit, launching new products and ongoing cost-cutting activities, in spite of expansion of strategic costs such as research and development and establishment of core operating system. As a result, income before income taxes increased by 4.2% as compared to the previous corresponding period, to Yen 34.6 billion, although foreign exchange losses incurred in other expense. The effective tax rate consequently dropped down due to the amount of tax exemption on research and development expenses which was expanded by the change of the Corporate Tax Law in Japan, and overall profitability improvement has been executed. As a result, net income increased by 13.0% as compared to the previous corresponding period, to Yen 22.2 billion. 2 *Conditions by Product Line Office Equipment (Sales up 6.7% to Yen 393.1 billion) - ----------------------------------------------------- Customer demands have been shifting more to digital, networked and color models from standalone analog products both in Japan and overseas market place. Ricoh enforced a solution proposal to customers for the optimization of their total printing costs in order to assist their efficient management of TDV (Total Document Volume). As a result, sales of color PPCs and Printing Systems such as MFPs and laser printers continued to grow and sales of Network System Solutions such as support and service increased while sales of Imaging Solutions decreased. Sales of optical disc business decreased as per continuous reduction in key module business such as independent developed disc drive and its related component, except media. Imaging Solutions (Sales down 5.7% to Yen 178.3 billion) -------------------------------------------------------- Digital Imaging Systems - Sales of color PPCs increased by new product in response to growth in customer demand. - Shift from standalone products to MFPs all over the world - As a result, sales in this category decreased by 2.1%. Other Imaging Systems --------------------- - Sales were down by 17.1% due to the shift from analog products to MFPs and color products. Network Input/Output Systems (Sales up 24.2% to Yen 171.3 billion) ------------------------------------------------------------------ Printing Systems - Continuous sales growth by introducing new offering products to cope with the shift to networked and color models both in Japan and overseas. MFPs: Imagio Neo 352 and Imagio Neo 602 in Japan Aficio 2035/2045 series and Aficio 2105/2090 series overseas Color MFPs: Imagio Neo C245 and Imagio Neo C385 in Japan Aficio 2232C/2238C series overseas - Sales volume of printers increased especially color laser printer and color printers for office use utilizing Ricoh's original 'GELJET' technology with strategic low price. - Ricoh Printing Systems, Ltd. became a subsidiary and contributed to our performances. - As a result, sales in this category increased by 35.9%. Other Input/Output Systems - Optical disc business that advanced to focus on media decreased its sales. Network System Solutions (Sales up 4.6% to Yen 43.5 billion) ------------------------------------------------------------ - Solution business such as support and service continued to increase due primarily to customer acceptance of our solution proposal to optimize their total printing cost. Consequently, net sales of Office Equipment segment increased by 6.7% as compared to the previous corresponding period, to Yen 393.1 billion. Operating income increased by 9.1% to Yen 54.5 billion. It was particularly resulted from sales increase and new products of Printing Systems and continuous cost reduction. Other Businesses (Sales down 3.2% to Yen 50.6 billion) - ------------------------------------------------------ Net sales of Other Business segment decreased by 3.2% as compared to the previous corresponding period, to Yen 50.6 billion, due primarily to the sales of certain consolidated subsidiaries in optical related business and sluggish demand cycle of semiconductor business. As a result, operating income in this segment decreased to Yen 0.1 billion. *Cash Flows (Nine months from April 1, 2004 to December 31, 2004) Net cash provided by operating activities decreased Yen 7.3 billion as compared to the previous corresponding period, to Yen 74.3 billion. Although the collection of trade receivables progressed, inventories increased in response to sales expansion in overseas markets. Income tax and bonus were paid, and retirement benefit obligation decreased due to the maintenance of the pension plan last fiscal year. Net cash used in investing activities was Yen 90.5 billion due to capital investment in new product lines, product development and the acquisition of new printer company, Ricoh Printing Systems, Ltd. As a result, free cash flow generated by operating and investing activities, which provided Yen 41.2 billion in the previous corresponding period, used Yen 16.2 billion. Net cash used in financing activities amounted to Yen 22.9 billion due primarily to cutback interest-bearing debt by means of reinforcement of cash management in each region and payment of dividends. As a result, cash and cash equivalents at the end of the third quarter decreased Yen 34.8 billion as compared to the end of the preceding year, to Yen 168.1 billion. 3 *Forecast for the entire fiscal year As for the forecast of business results for the fiscal year ending March 31, 2005, we have revised our sales forecast as announced in October 2004, up to Yen 1,815.0 billion with 2.0% growth as compared to the previous fiscal year. We forecast the sales volume of Office Equipment will increase both in Japan and overseas in consideration of positive effect showed up in regard to the promotion for color models and the reform of non-core businesses, which were conducted during this first half of fiscal year. For the fourth quarter, we predict an exchange rate of Yen 105.00 against the US dollar, and of Yen 130.00 against the euro, without change. As for income, we revised downward our forecast to operating income of Yen 147.0 billion and income before income taxes of Yen 141.0 billion, from Yen 151.0 billion and Yen 145.5 billion of which we announced in October 2004, respectively. It is due primarily to strategic investment for 15th medium-term plan that will start from next fiscal year. Forecast net income of Yen 85.0 billion has not been revised and same as announced in October 2004. Our performance forecasts for fiscal 2005 are as follows: Exchange Rate Assumptions for the full year ending March 31, 2005 US$ 1 = Yen 107.67 (Yen 113.09 in previous fiscal year) EURO 1 = Yen 133.45 (Yen 132.65 in previous fiscal year) (Billions of yen) - -------------------------------------------------------------------------------- Year ending Year ended March 31, 2005 March 31, 2004 Change (Forecast) (Results) - -------------------------------------------------------------------------------- Domestic sales 972.9 914.0 6.4% Overseas sales 842.1 866.1 -2.8% Net sales 1,815.0 1,780.2 2.0% Gross profit 764.0 765.6 -0.2% Operating income 147.0 150.0 -2.0% Income before income taxes 141.0 143.0 -1.4% Net income 85.0 91.7 -7.4% *Note - -------------------------------------------------------------------------------- *Note: As for net income for the year ended March 31, 2004, Yen 7.3 billion of net realized gains of the certain marketable securities, which were contributed to the employee retirement benefit trust, were incorporated as cumulative effect of accounting change. * Ricoh bases the forecast estimates for the year ending 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. 4 RICOH COMPANY, LTD. AND CONSOLIDATED SUBSIDIARIES FINANCIAL HIGHLIGHTS FOR THE THIRD QUARTER ENDED DECEMBER 31, 2004 (U.S. GAAP FINANCIAL INFORMATION) 1. ITEMS RELATING TO THIRD QUARTER FINANCIAL STATEMENTS (1) No change in accounting method has been made. (2) Change relating to the scale of consolidation and the application of the equity method: Consolidated subsidiaries: 12 additions; No change Companies accounted for by the equity method: 2 additions; 1 removal 2. RESULTS FOR THE PERIOD FROM OCTOBER 1, 2004 TO DECEMBER 31, 2004
(1) Operating Results (Millions of yen) - -------------------------------------------------------------------------------------------------------------------- Three months ended Three months ended Year ended December 31, 2004 December 31, 2003 March 31, 2004 - -------------------------------------------------------------------------------------------------------------------- Net sales 443,799 420,903 1,780,245 (% change from the previous corresponding period) 5.4 0.0 2.4 Operating income 38,709 36,214 150,006 (% change from the previous corresponding period) 6.9 8.4 12.2 Income before income taxes 34,661 33,266 143,063 (% change from the previous corresponding period) 4.2 10.9 15.9 Net income 22,223 19,664 91,766 (% change from the previous corresponding period) 13.0 10.5 26.6 Net income per share-basic (yen) 30.08 26.53 123.63 Net income per share-diluted (yen) - - - - --------------------------------------------------------------------------------------------------------------------
Note: Equity in earnings of affiliates:Yen 1,532 million (Yen 932 million in previous corresponding period)
(2) Financial Position (Millions of yen) - ------------------------------------------------------------------------------------------------------------------- December 31, 2004 December 31, 2003 March 31, 2004 - ------------------------------------------------------------------------------------------------------------------- Total assets 1,899,898 1,922,150 1,852,793 Shareholders' equity 841,998 708,888 795,131 Equity ratio (%) 44.3 36.9 42.9 Equity per share (yen) 1,139.87 958.20 1,076.11 - -------------------------------------------------------------------------------------------------------------------
Cash Flow (Millions of yen) - ------------------------------------------------------------------------------------------------------------------- Nine months ended Nine months ended Year ended December 31, 2004 December 31, 2003 March 31, 2004 - ------------------------------------------------------------------------------------------------------------------- Cash flows from operating activities 74,318 81,698 154,911 Cash flows from investing activities -90,576 -40,400 -63,383 Cash flows from financing activities -22,949 9,223 -74,835 Cash and cash equivalents at end of period 168,173 238,389 203,039 - -------------------------------------------------------------------------------------------------------------------
3. FORECAST OF OPERATING RESULTS FROM APRIL 1, 2004 TO MARCH 31, 2005 (Millions of yen) - ------------------------------------------------------------------------------------------------------------------- Net sales 1,815,000 Operating income 147,000 Income before income taxes 141,000 Net income 85,000 - -------------------------------------------------------------------------------------------------------------------
Note: Net income per share (Consolidated) Yen 115.07 In accordance with Japanese regulations, Ricoh has issued forecast for its financial results for the fiscal year ending March 31, 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. 5 CONSOLIDATED PERFORMANCE 1. CONSOLIDATED STATEMENTS OF INCOME
(Three months ended December 31, 2004 and 2003) (Millions of yen) - ----------------------------------------------------------------------------------------------------------------------- Three months ended Three months ended December 31, 2004 December 31, 2003 Change % - ----------------------------------------------------------------------------------------------------------------------- Net sales 443,799 420,903 22,896 5.4 Cost of sales 251,696 235,124 16,572 7.0 Percentage of net sales (%) 56.7 55.9 Gross Profit 192,103 185,779 6,324 3.4 Percentage of net sales (%) 43.3 44.1 Selling, general and administrative expenses 153,394 149,565 3,829 2.6 Percentage of net sales (%) 34.6 35.5 Operating income 38,709 36,214 2,495 6.9 Percentage of net sales (%) 8.7 8.6 Other (income) expense Interest and dividend income 358 434 -76 -17.5 Percentage of net sales (%) 0.1 0.1 Interest expense 1,276 1,337 -61 -4.6 Percentage of net sales (%) 0.3 0.3 Other, net 3,130 2,045 1,085 53.1 Percentage of net sales (%) 0.7 0.5 Income before income taxes, equity income and minority interests 34,661 33,266 1,395 4.2 Percentage of net sales (%) 7.8 7.9 Provision for income taxes 12,500 13,473 -973 -7.2 Percentage of net sales (%) 2.8 3.2 Minority interests in earnings of subsidiaries 1,470 1,061 409 38.5 Percentage of net sales (%) 0.3 0.2 Equity in earnings of affiliates 1,532 932 600 64.4 Percentage of net sales (%) 0.3 0.2 Net income 22,223 19,664 2,559 13.0 Percentage of net sales (%) 5.0 4.7 - ----------------------------------------------------------------------------------------------------------------------- Reference : Exchange rate US$ 1 Yen 106.01 Yen 108.92 EURO 1 Yen 137.16 Yen 129.58
(Nine months ended December 31, 2004 and 2003 and Year ended March 31, 2004) (Millions of yen) - -------------------------------------------------------------------------------------------------------------------------------- Nine months ended Nine months ended Year ended December 31, 2004 December 31, 2003 Change % March 31, 2004 - -------------------------------------------------------------------------------------------------------------------------------- Net sales 1,319,802 1,308,993 10,809 0.8 1,780,245 Cost of sales 763,819 735,107 28,712 3.9 1,014,619 Percentage of net sales (%) 57.9 56.2 57.0 Gross Profit 555,983 573,886 -17,903 -3.1 765,626 Percentage of net sales (%) 42.1 43.8 43.0 Selling, general and administrative expenses 459,516 460,417 -901 -0.2 615,620 Percentage of net sales (%) 34.8 35.1 34.6 Operating income 96,467 113,469 -17,002 -15.0 150,006 Percentage of net sales (%) 7.3 8.7 8.4 Other (income) expense Interest and dividend income 1,431 1,747 -316 -18.1 1,925 Percentage of net sales (%) 0.1 0.1 0.1 Interest expense 3,592 4,200 -608 -14.5 5,290 Percentage of net sales (%) 0.3 0.3 0.3 Other, net -419 6,334 -6,753 - 3,578 Percentage of net sales (%) -0.1 0.5 0.2 Income before income taxes, equity income and minority interests 94,725 104,682 -9,957 -9.5 143,063 Percentage of net sales (%) 7.2 8.0 8.0 Provision for income taxes 36,279 41,897 -5,618 -13.4 56,641 Percentage of net sales (%) 2.7 3.2 3.2 Minority interests in earnings of subsidiaries 3,368 2,760 608 22.0 4,094 Percentage of net sales (%) 0.3 0.2 0.2 Equity in earnings of affiliates 2,966 1,904 1,062 55.8 2,065 Percentage of net sales (%) 0.2 0.1 0.1 Income before cumulative effect 58,044 61,929 -3,885 -6.3 84,393 of accounting changes Percentage of net sales (%) 4.4 4.7 4.7 Cumulative effect of accounting change, net of tax - - - - 7,373 Percentage of net sales (%) - - 0.5 Net income 58,044 61,929 -3,885 -6.3 91,766 Percentage of net sales (%) 4.4 4.7 5.2 - --------------------------------------------------------------------------------------------------------------------------------- Reference : Exchange rate US$ 1 Yen 108.55 Yen 115.00 Yen 113.09 EURO 1 Yen 134.60 Yen 132.17 Yen 132.65
6 2-1. CONSOLIDATED SALES BY PRODUCT CATEGORY
(Three months ended December 31, 2004 and 2003) (Millions of yen) - ----------------------------------------------------------------------------------------------- Three months ended Three months ended Change % December 31, 2004 December 31, 2003 - ----------------------------------------------------------------------------------------------- Imaging Solutions: Digital Imaging Systems 140,909 143,882 -2,973 -2.1 Percentage of net sales (%) 31.8 34.2 Other Imaging Systems 37,408 45,151 -7,743 -17.1 Percentage of net sales (%) 8.4 10.7 Total Imaging Solutions 178,317 189,033 -10,716 -5.7 Percentage of net sales (%) 40.2 44.9 - ----------------------------------------------------------------------------------------------- Network Input/Output Systems: Printing Systems 169,281 124,564 44,717 35.9 Percentage of net sales (%) 38.1 29.6 Other Input/Output Systems 2,043 13,372 -11,329 -84.7 Percentage of net sales (%) 0.5 3.2 Total Network Input/Output Systems 171,324 137,936 33,388 24.2 Percentage of net sales (%) 38.6 32.8 - ----------------------------------------------------------------------------------------------- Network System Solutions 43,531 41,623 1,908 4.6 Percentage of net sales (%) 9.8 9.9 - ----------------------------------------------------------------------------------------------- Office Equipment Total 393,172 368,592 24,580 6.7 Percentage of net sales (%) 88.6 87.6 - ----------------------------------------------------------------------------------------------- Other Businesses 50,627 52,311 -1,684 -3.2 Percentage of net sales (%) 11.4 12.4 - ----------------------------------------------------------------------------------------------- Grand Total 443,799 420,903 22,896 5.4 Percentage of net sales (%) 100.0 100.0 - ----------------------------------------------------------------------------------------------- Reference : Exchange rate US$ 1 Yen 106.01 Yen 108.92 EURO 1 Yen 137.16 Yen 129.58
(Nine months ended December 31, 2004 and 2003 and Year ended March 31, 2004) (Millions of yen) - -------------------------------------------------------------------------------------------------------------------- Nine months ended Nine months ended Year ended December 31, 2004 December 31, 2003 Change % March 31, 2004 - -------------------------------------------------------------------------------------------------------------------- Imaging Solutions: Digital Imaging Systems 416,440 453,040 -36,600 -8.1 606,270 Percentage of net sales (%) 31.6 34.6 34.1 Other Imaging Systems 118,482 151,087 -32,605 -21.6 197,304 Percentage of net sales (%) 8.9 11.6 11.0 Total Imaging Solutions 534,922 604,127 -69,205 -11.5 803,574 Percentage of net sales (%) 40.5 46.2 45.1 - -------------------------------------------------------------------------------------------------------------------- Network Input/Output Systems: Printing Systems 470,624 358,021 112,603 31.5 509,212 Percentage of net sales (%) 35.7 27.4 28.6 Other Input/Output Systems 11,022 43,097 -32,075 -74.4 49,025 Percentage of net sales (%) 0.8 3.2 2.8 Total Network Input/Output Systems 481,646 401,118 80,528 20.1 558,237 Percentage of net sales (%) 36.5 30.6 31.4 - -------------------------------------------------------------------------------------------------------------------- Network System Solutions 142,569 138,855 3,714 2.7 195,822 Percentage of net sales (%) 10.8 10.6 11.0 - -------------------------------------------------------------------------------------------------------------------- Office Equipment Total 1,159,137 1,144,100 15,037 1.3 1,557,633 Percentage of net sales (%) 87.8 87.4 87.5 - -------------------------------------------------------------------------------------------------------------------- Other Businesses 160,665 164,893 -4,228 -2.6 222,612 Percentage of net sales (%) 12.2 12.6 12.5 - -------------------------------------------------------------------------------------------------------------------- Grand Total 1,319,802 1,308,993 10,809 0.8 1,780,245 Percentage of net sales (%) 100.0 100.0 100.0 - -------------------------------------------------------------------------------------------------------------------- Reference : Exchange rate US$ 1 Yen 108.55 Yen 115.00 Yen 113.09 EURO 1 Yen 134.60 Yen 132.17 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 7 2-2. CONSOLIDATED SALES BY GEOGRAPHIC AREA
(Three months ended December 31, 2004 and 2003) (Millions of yen) - ---------------------------------------------------------------------------------------------------------------------- Three months ended Three months ended December 31, 2004 December 31, 2003 Change % - ---------------------------------------------------------------------------------------------------------------------- 231,321 212,908 18,413 8.6 Percentage of net sales (%) 52.1 50.6 212,478 207,995 4,483 2.2 Percentage of net sales (%) 47.9 49.4 The Americas 78,246 75,933 2,313 3.0 Percentage of net sales (%) 17.6 18.0 Europe 107,610 99,422 8,188 8.2 Percentage of net sales (%) 24.2 23.6 Other 26,622 32,640 -6,018 -18.4 Percentage of net sales (%) 6.1 7.8 Grand Total 443,799 420,903 22,896 5.4 Percentage of net sales (%) 100.0 100.0 - ---------------------------------------------------------------------------------------------------------------------- Reference : Exchange rate US$ 1 Yen 106.01 Yen 108.92 EURO 1 Yen 137.16 Yen 129.58
(Nine months ended December 31, 2004 and 2003 and Year ended March 31, 2004) (Millions of yen) - --------------------------------------------------------------------------------------------------------------------------------- Nine months ended Nine months ended Year ended December 31, 2004 December 31, 2003 Change % March 31, 2004 - --------------------------------------------------------------------------------------------------------------------------------- 700,497 661,544 38,953 5.9 914,060 Percentage of net sales (%) 53.1 50.5 51.3 619,305 647,449 -28,144 -4.3 866,185 Percentage of net sales (%) 46.9 49.5 48.7 The Americas 239,576 243,597 -4,021 -1.7 326,380 Percentage of net sales (%) 18.2 18.6 18.3 Europe 300,597 296,373 4,224 1.4 402,392 Percentage of net sales (%) 22.8 22.6 22.6 Other 79,132 107,479 -28,347 -26.4 137,413 Percentage of net sales (%) 5.9 8.3 7.8 Grand Total 1,319,802 1,308,993 10,809 0.8 1,780,245 Percentage of net sales (%) 100.0 100.0 100.0 - --------------------------------------------------------------------------------------------------------------------------------- Reference : Exchange rate US$ 1 Yen 108.55 Yen 115.00 Yen 113.09 EURO 1 Yen 134.60 Yen 132.17 Yen 132.65
8 3. CONSOLIDATED BALANCE SHEETS
(December 31, 2004 and March 31, 2004) Assets (Millions of yen) - -------------------------------------------------------------------------------------------------------------------------- December 31, 2004 March 31, 2004 Change - -------------------------------------------------------------------------------------------------------------------------- Current Assets Cash and time deposits 169,028 204,001 -34,973 Trade receivables 415,977 422,244 -6,267 Marketable securities 33,136 45,124 -11,988 Inventories 168,994 145,369 23,625 Other current assets 53,739 55,079 -1,340 Total Current Assets 840,874 871,817 -30,943 Fixed Assets Tangible fixed assets 245,061 238,712 6,349 Finance receivables 545,697 514,047 31,650 Other Investments 268,266 228,217 40,049 Total Fixed Assets 1,059,024 980,976 78,048 - -------------------------------------------------------------------------------------------------------------------------- Total Assets 1,899,898 1,852,793 47,105 - -------------------------------------------------------------------------------------------------------------------------- Note: Contents of cash and time deposits: Cash and cash equivalents 168,173 203,039 Time deposits 855 962 Liabilities and Shareholders' Investment (Millions of yen) - -------------------------------------------------------------------------------------------------------------------------- December 31, 2004 March 31, 2004 Change - -------------------------------------------------------------------------------------------------------------------------- Current Liabilities Trade payables 285,944 297,672 -11,728 Short-term borrowings 216,088 151,162 64,926 Other current liabilities 140,637 158,594 -17,957 Total Current Liabilities 642,669 607,428 35,241 Fixed Liabilities Long-term indebtedness 230,409 281,570 -51,161 Accrued pension and severance costs 94,597 83,492 11,105 Other fixed liabilities 39,564 36,295 3,269 Total Fixed Liabilities 364,570 401,357 -36,787 - -------------------------------------------------------------------------------------------------------------------------- Total Liabilities 1,007,239 1,008,785 -1,546 - -------------------------------------------------------------------------------------------------------------------------- Minority Interest 50,661 48,877 1,784 - -------------------------------------------------------------------------------------------------------------------------- Shareholders' Investment Common stock 135,364 135,364 - Additional paid-in capital 186,599 186,599 0 Retained earnings 559,416 515,372 44,044 Accumulated other comprehensive income (loss) -27,008 -30,272 3,264 Treasury stock -12,373 -11,932 -441 Total Shareholders' Investment 841,998 795,131 46,867 - -------------------------------------------------------------------------------------------------------------------------- Total Liabilities and Shareholders' Investment 1,899,898 1,852,793 47,105 - -------------------------------------------------------------------------------------------------------------------------- Note: Other comprehensive income; Net unrealized holding gains on available-for-sale securities 4,340 4,026 314 Pension liability adjustments -16,953 -14,863 -2,090 Net unrealized gains (losses) on derivative instruments -21 -24 3 Cumulative translation adjustments -14,374 -19,411 5,037 Reference: Exchange rate December 31, 2004 March 31, 2004 US$ 1 Yen 104.21 Yen 105.69 EURO 1 Yen 141.61 Yen 128.88
9 4. CONSOLIDATED STATEMENTS OF CASH FLOW
(Nine months ended December 31, 2004 and 2003 and Year ended March 31, 2004) (Millions of yen) - -------------------------------------------------------------------------------------------------------------------------------- Nine months ended Nine months ended Year ended December 31, 2004 December 31, 2003 March 31, 2004 - -------------------------------------------------------------------------------------------------------------------------------- I. Cash Flows from Operating Activities: 1. Net income 58,044 61,929 91,766 2. Adjustments to reconcile net income to net cash provided by operating activities-- Depreciation and amortization 57,498 56,381 76,968 Equity in earnings of affiliates, net of dividends received -2,163 -1,162 -1,001 Deferred income taxes 5,731 1,026 3,338 Losses on disposal and sales of tangible fixed assets 1,600 1,094 2,035 Cumulative effect of accounting change, net of tax - - -7,373 Changes in assets and liabilities, net of effects from acquisition-- (Increase) decrease in trade receivables 23,847 10,563 -11,367 Increase in inventories -14,111 -21,209 -4,317 Increase in finance receivables -19,659 -22,666 -32,650 (Decrease) increase in trade payables -23,282 -6,111 21,316 Decrease in accrued income taxes and accrued expenses and other -24,387 -28,587 -5,913 (Decrease) Increase in accrued pension and severance costs 2,454 15,455 -609 Other, net 8,746 14,985 22,718 - -------------------------------------------------------------------------------------------------------------------------------- Net cash provided by operating activities 74,318 81,698 154,911 - -------------------------------------------------------------------------------------------------------------------------------- II. Cash Flows from Investing Activities: 1. Proceeds from sales of property, plant and equipment 1,631 134 190 2. Expenditures for tangible fixed assets -58,253 -51,830 -75,432 3. Payments for purchases of available-for-sale securities -27,161 -25,200 -35,518 4. Proceeds from sales of available-for-sale securities 39,024 34,047 45,464 5. Decrease in time deposits, net 108 10,192 9,915 6. Other, net -45,925 -7,743 -8,002 - -------------------------------------------------------------------------------------------------------------------------------- Net cash used in investing activities -90,576 -40,400 -63,383 - -------------------------------------------------------------------------------------------------------------------------------- III. Cash Flows from Financing Activities: 1. Proceeds from long-term indebtedness 45,053 1,104 13,349 2. Repayment of long-term indebtedness -37,522 -25,788 -31,509 3. (Decrease) increase in short-term borrowings, net -1,628 68,169 -10,728 4. Proceeds from issuance of long-term debt securities 9,000 1,000 1,000 5. Repayment of long-term debt securities -22,000 -14,000 -23,910 6. Dividends paid -14,793 -11,136 -11,136 7. Payment for purchase of treasury stock -480 -9,634 -11,411 8. Other, net -579 -492 -490 - -------------------------------------------------------------------------------------------------------------------------------- Net cash used in financing activities -22,949 9,223 -74,835 - -------------------------------------------------------------------------------------------------------------------------------- IV. Effect of Exchange Rate Changes on Cash and Cash Equivalents 1,866 -1,375 -2,897 - -------------------------------------------------------------------------------------------------------------------------------- V. Net Increase (Decrease) in Cash and Cash Equivalents -37,341 49,146 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 168,173 238,389 203,039 - --------------------------------------------------------------------------------------------------------------------------------
10 5. SEGMENT INFORMATION (1) Industry Segment Information
(Three months ended December 31, 2004 and 2003) (Millions of yen) - ------------------------------------------------------------------------------------------------------------------- Three months ended Three months ended December 31, 2004 December 31, 2003 Change % - ------------------------------------------------------------------------------------------------------------------- OFFICE EQUIPMENT: Net sales: Unaffiliated customers 393,172 368,592 24,580 6.7 Intersegment - - - - Total 393,172 368,592 24,580 6.7 - ------------------------------------------------------------------------------------------------------------------- Operating expenses 338,656 318,629 20,027 6.3 - ------------------------------------------------------------------------------------------------------------------- Operating income 54,516 49,963 4,553 9.1 Operating income on office equipment sales(%) 13.9 13.6 - ------------------------------------------------------------------------------------------------------------------- OTHER BUSINESSES: Net sales: Unaffiliated customers 50,627 52,311 -1,684 -3.2 Intersegment 596 575 21 3.7 Total 51,223 52,886 -1,663 -3.1 - ------------------------------------------------------------------------------------------------------------------- Operating expenses 51,119 51,878 -759 -1.5 - ------------------------------------------------------------------------------------------------------------------- Operating income 104 1,008 -904 -89.7 Operating income on sales in other businesses (%) 0.2 1.9 - ------------------------------------------------------------------------------------------------------------------- CORPORATE AND ELIMINATIONS: Net sales: Intersegment -596 -575 -21 - Total -596 -575 -21 - - ------------------------------------------------------------------------------------------------------------------- Operating expenses: Intersegment -592 -569 -23 - Corporate 15,907 14,751 1,156 - Total 15,315 14,182 1,133 - - ------------------------------------------------------------------------------------------------------------------- Operating income -15,911 -14,757 -1,154 - - ------------------------------------------------------------------------------------------------------------------- CONSOLIDATED: Net sales: Unaffiliated customers 443,799 420,903 22,896 5.4 Intersegment - - - - Total 443,799 420,903 22,896 5.4 - ------------------------------------------------------------------------------------------------------------------- Operating expenses 405,090 384,689 20,401 5.3 - ------------------------------------------------------------------------------------------------------------------- Operating income 38,709 36,214 2,495 6.9 Operating income on consolidated net sales(%) 8.7 8.6 - -------------------------------------------------------------------------------------------------------------------
(Nine months ended December 31, 2004 and 2003 and Year ended March 31, 2004) (Millions of yen) - ------------------------------------------------------------------------------------------------------------------------------------ Nine months ended Nine months ended % Year ended December 31, 2004 December 31, 2003 Change March 31, 2004 - ------------------------------------------------------------------------------------------------------------------------------------ OFFICE EQUIPMENT: Net sales: Unaffiliated customers 1,159,137 1,144,100 15,037 1.3 1,557,633 Intersegment - - - - - Total 1,159,137 1,144,100 15,037 1.3 1,557,633 - ------------------------------------------------------------------------------------------------------------------------------------ Operating expenses 1,022,415 991,438 30,977 3.1 1,353,304 - ------------------------------------------------------------------------------------------------------------------------------------ Operating income 136,722 152,662 -15,940 -10.4 204,329 Operating income on office equipment sales(%) 11.8 13.3 13.1 - ------------------------------------------------------------------------------------------------------------------------------------ OTHER BUSINESSES: Net sales: Unaffiliated customers 160,665 164,893 -4,228 -2.6 222,612 Intersegment 1,862 1,740 122 7.0 2,462 Total 162,527 166,633 -4,106 -2.5 225,074 - ------------------------------------------------------------------------------------------------------------------------------------ Operating expenses 161,166 162,639 -1,473 -0.9 220,391 - ------------------------------------------------------------------------------------------------------------------------------------ Operating income 1,361 3,994 -2,633 -65.9 4,683 Operating income on sales in other businesses (%) 0.8 2.4 2.1 - ------------------------------------------------------------------------------------------------------------------------------------ CORPORATE AND ELIMINATIONS: Net sales: Intersegment -1,862 -1,740 -122 - -2,462 Total -1,862 -1,740 -122 - -2,462 - ------------------------------------------------------------------------------------------------------------------------------------ Operating expenses: Intersegment -1,860 -1,764 -96 - -2,494 Corporate 41,614 43,211 -1,597 - 59,038 Total 39,754 41,447 -1,693 - 56,544 - ------------------------------------------------------------------------------------------------------------------------------------ Operating income -41,616 -43,187 1,571 - -59,006 - ------------------------------------------------------------------------------------------------------------------------------------ CONSOLIDATED: Net sales: Unaffiliated customers 1,319,802 1,308,993 10,809 0.8 1,780,245 Intersegment - - - - - Total 1,319,802 1,308,993 10,809 0.8 1,780,245 - ------------------------------------------------------------------------------------------------------------------------------------ Operating expenses 1,223,335 1,195,524 27,811 2.3 1,630,239 - ------------------------------------------------------------------------------------------------------------------------------------ Operating income 96,467 113,469 -17,002 -15.0 150,006 Operating income on consolidated net sales(%) 7.3 8.7 8.4 - ------------------------------------------------------------------------------------------------------------------------------------
11 (2) Geographic Segment Information
(Three months ended December 31, 2004 and 2003) (Millions of yen) - -------------------------------------------------------------------------------------------------------------- Three months ended Three months ended December 31, 2004 December 31, 2003 Change % - -------------------------------------------------------------------------------------------------------------- JAPAN: Net sales: External customers 236,003 224,398 11,605 5.2 Intersegment 104,719 83,101 21,618 26.0 Total 340,722 307,499 33,223 10.8 - -------------------------------------------------------------------------------------------------------------- Operating expenses 311,668 286,985 24,683 8.6 - -------------------------------------------------------------------------------------------------------------- Operating income 29,054 20,514 8,540 41.6 Operating income on sales in Japan(%) 8.5 6.7 - -------------------------------------------------------------------------------------------------------------- THE AMERICAS: Net sales: External customers 78,146 72,323 5,823 8.1 Intersegment 1,327 872 455 52.2 Total 79,473 73,195 6,278 8.6 - -------------------------------------------------------------------------------------------------------------- Operating expenses 77,846 71,067 6,779 9.5 - -------------------------------------------------------------------------------------------------------------- Operating income 1,627 2,128 -501 -23.5 Operating income on sales in the Americas(%) 2.0 2.9 - -------------------------------------------------------------------------------------------------------------- EUROPE: Net sales: External customers 108,085 98,864 9,221 9.3 Intersegment 747 1,036 -289 -27.9 Total 108,832 99,900 8,932 8.9 - -------------------------------------------------------------------------------------------------------------- Operating expenses 103,620 93,998 9,622 10.2 - -------------------------------------------------------------------------------------------------------------- Operating income 5,212 5,902 -690 -11.7 Operating income on sales in Europe(%) 4.8 5.9 - -------------------------------------------------------------------------------------------------------------- OTHER: Net sales: External customers 21,565 25,318 -3,753 -14.8 Intersegment 21,501 20,227 1,274 6.3 Total 43,066 45,545 -2,479 -5.4 - -------------------------------------------------------------------------------------------------------------- Operating expenses 39,925 42,923 -2,998 -7.0 - -------------------------------------------------------------------------------------------------------------- Operating income 3,141 2,622 519 19.8 Operating income on sales in other(%) 7.3 5.8 - -------------------------------------------------------------------------------------------------------------- CORPORATE AND ELIMINATIONS: Net sales: Intersegment -128,294 -105,236 -23,058 - Total -128,294 -105,236 -23,058 - - -------------------------------------------------------------------------------------------------------------- Operating expenses: -127,969 -110,284 -17,685 - - -------------------------------------------------------------------------------------------------------------- Operating income -325 5,048 -5,373 - - -------------------------------------------------------------------------------------------------------------- CONSOLIDATED: Net sales: External customers 443,799 420,903 22,896 5.4 Intersegment - - - - Total 443,799 420,903 22,896 5.4 - -------------------------------------------------------------------------------------------------------------- Operating expenses 405,090 384,689 20,401 5.3 - -------------------------------------------------------------------------------------------------------------- Operating income 38,709 36,214 2,495 6.9 Operating income on consolidated net sales(%) 8.7 8.6 - --------------------------------------------------------------------------------------------------------------
12
(Nine months ended December 31, 2004 and 2003 and Year ended March 31, 2004) (Millions of yen) - ---------------------------------------------------------------------------------------------------------------------------- Nine months ended Nine months ended % Year ended December 31, 2004 December 31, 2003 Change March 31, 2004 - ---------------------------------------------------------------------------------------------------------------------------- JAPAN: Net sales: External customers 717,476 703,320 14,156 2.0 962,127 Intersegment 294,539 267,432 27,107 10.1 351,070 Total 1,012,015 970,752 41,263 4.3 1,313,197 - ---------------------------------------------------------------------------------------------------------------------------- Operating expenses 943,269 893,451 49,818 5.6 1,215,875 - ---------------------------------------------------------------------------------------------------------------------------- Operating income 68,746 77,301 -8,555 -11.1 97,322 Operating income on sales in Japan(%) 6.8 8.0 7.4 - ---------------------------------------------------------------------------------------------------------------------------- THE AMERICAS: Net sales: External customers 237,330 234,288 3,042 1.3 315,504 Intersegment 6,141 3,864 2,277 58.9 5,249 Total 243,471 238,152 5,319 2.2 320,753 - ---------------------------------------------------------------------------------------------------------------------------- Operating expenses 235,711 228,341 7,370 3.2 305,284 - ---------------------------------------------------------------------------------------------------------------------------- Operating income 7,760 9,811 -2,051 -20.9 15,469 Operating income on sales in the Americas(%) 3.2 4.1 4.8 - ---------------------------------------------------------------------------------------------------------------------------- EUROPE: Net sales: External customers 302,026 295,424 6,602 2.2 400,646 Intersegment 2,536 2,807 -271 -9.7 3,770 Total 304,562 298,231 6,331 2.1 404,416 - ---------------------------------------------------------------------------------------------------------------------------- Operating expenses 288,388 282,817 5,571 2.0 382,383 - ---------------------------------------------------------------------------------------------------------------------------- Operating income 16,174 15,414 760 4.9 22,033 Operating income on sales in Europe(%) 5.3 5.2 5.4 - ---------------------------------------------------------------------------------------------------------------------------- OTHER: Net sales: External customers 62,970 75,961 -12,991 -17.1 101,968 Intersegment 65,319 69,452 -4,133 -6.0 91,373 Total 128,289 145,413 -17,124 -11.8 193,341 - ---------------------------------------------------------------------------------------------------------------------------- Operating expenses 119,713 138,225 -18,512 -13.4 182,870 - ---------------------------------------------------------------------------------------------------------------------------- Operating income 8,576 7,188 1,388 19.3 10,471 Operating income on sales in other(%) 6.7 4.9 5.4 - ---------------------------------------------------------------------------------------------------------------------------- CORPORATE AND ELIMINATIONS: Net sales: Intersegment -368,535 -343,555 -24,980 - -451,462 Total -368,535 -343,555 -24,980 - -451,462 - ---------------------------------------------------------------------------------------------------------------------------- Operating expenses: -363,746 -347,310 -16,436 - -456,173 - ---------------------------------------------------------------------------------------------------------------------------- Operating income -4,789 3,755 -8,544 - 4,711 - ---------------------------------------------------------------------------------------------------------------------------- CONSOLIDATED: Net sales: External customers 1,319,802 1,308,993 10,809 0.8 1,780,245 Intersegment - - - - - Total 1,319,802 1,308,993 10,809 0.8 1,780,245 - ---------------------------------------------------------------------------------------------------------------------------- Operating expenses 1,223,335 1,195,524 27,811 2.3 1,630,239 - ---------------------------------------------------------------------------------------------------------------------------- Operating income 96,467 113,469 -17,002 -15.0 150,006 Operating income on consolidated net sales(%) 7.3 8.7 8.4 - ----------------------------------------------------------------------------------------------------------------------------
13 6. SIGNIFICANT ACCOUNTING POLICIES (CONSOLIDATED) 1. CHANGE RELATING TO THE SCALE OF CONSOLIDATION AND THE APPLICATION OF THE EQUITY METHOD FROM OCTOBER 1, 2004 TO DECEMBER 31, 2004. Consolidated subsidiaries: 12 additions including Ricoh Printing Systems, Ltd. and Shanghai Ricoh Digital Equipment Co., Ltd. No removal Companies accounted for by the equity method: 2 additions including Santama Sougou Jimukiki Co., Ltd. Removal: Shanghai Ricoh Digital Equipment Co., 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. 14 -APPENDIX- (Third Quarter Ended December 31, 2004) 1. CONSOLIDATED QUARTERLY PERFORMANCE OUTLINE
Fiscal 2005 (Millions of yen) - ---------------------------------------------------------------------------------------------------------- 1Q Change(%) 2Q Change(%) 3Q Change(%) - ---------------------------------------------------------------------------------------------------------- Net sales 436,550 -0.2 439,453 -2.5 443,799 5.4 Gross profit 189,171 -1.9 174,709 -10.6 192,103 3.4 Operating income 39,387 2.3 18,371 -52.6 38,709 6.9 Income before income taxes 41,319 10.7 18,745 -45.0 34,661 4.2 Net income 24,894 11.4 10,927 -45.1 22,223 13.0 - ---------------------------------------------------------------------------------------------------------- Net income per share (yen) 33.69 - 14.79 - 30.08 - - ---------------------------------------------------------------------------------------------------------- Total assets 1,855,745 - 1,877,455 - 1,899,898 - Shareholders' equity 812,915 - 830,280 - 841,998 - - ---------------------------------------------------------------------------------------------------------- Shareholders' equity per share (yen) 1,100.24 - 1,123.84 - 1,139.87 - - ----------------------------------------------------------------------------------------------------------
Fiscal 2004 (Millions of yen) - ---------------------------------------------------------------------------------------------------------------------------------- 1Q Change(%) 2Q Change(%) 3Q Change(%) 4Q Change(%) - ---------------------------------------------------------------------------------------------------------------------------------- Net sales 437,453 2.1 450,637 5.2 420,903 0.0 471,252 2.3 Gross profit 192,752 3.4 195,355 12.2 185,779 0.5 191,740 -4.0 Operating income 38,484 7.1 38,771 52.6 36,214 8.4 36,537 -6.2 Income before income taxes 37,317 15.6 34,099 45.7 33,266 10.9 38,381 1.5 Net income 22,355 14.5 19,910 42.2 19,664 10.5 29,837 40.8 - ---------------------------------------------------------------------------------------------------------------------------------- Net income per share (yen) 30.04 - 26.75 - 26.53 - 40.31 - - ---------------------------------------------------------------------------------------------------------------------------------- Total assets 1,924,631 - 1,912,162 - 1,922,150 - 1,852,793 - Shareholders' equity 685,730 - 703,075 - 708,888 - 795,131 - - ---------------------------------------------------------------------------------------------------------------------------------- Shareholders' equity per share (yen) 920.97 - 946.38 - 958.20 - 1,076.11 - - ----------------------------------------------------------------------------------------------------------------------------------
A1 2. Consolidated Sales by Product Category
(Three months ended December 31, 2004 and 2003) (Millions of yen) - ----------------------------------------------------------------------------------------------------------------------------------- Three months ended Three months ended Change excluding December 31, 2004 December 31, 2003 Change % exchage impact % - ----------------------------------------------------------------------------------------------------------------------------------- Imaging Solutions: Digital Imaging Systems 140,909 143,882 -2,973 -2.1 -3,864 -2.7 Percentage of net sales (%) 31.8 34.2 Domestic 56,640 60,016 -3,376 -5.6 -3,376 -5.6 Overseas 84,269 83,866 403 0.5 -488 -0.6 Other Imaging Systems 37,408 45,151 -7,743 -17.1 -8,075 -17.9 Percentage of net sales (%) 8.4 10.7 Domestic 15,470 17,291 -1,821 -10.5 -1,821 -10.5 Overseas 21,938 27,860 -5,922 -21.3 -6,254 -22.4 Total Imaging Solutions 178,317 189,033 -10,716 -5.7 -11,939 -6.3 Percentage of net sales (%) 40.2 44.9 Domestic 72,110 77,307 -5,197 -6.7 -5,197 -6.7 Overseas 106,207 111,726 -5,519 -4.9 -6,742 -6.0 - ----------------------------------------------------------------------------------------------------------------------------------- Network Input/Output Systems: Printing Systems 169,281 124,564 44,717 35.9 43,403 34.8 Percentage of net sales (%) 38.1 29.6 Domestic 73,923 53,559 20,364 38.0 20,364 38.0 Overseas 95,358 71,005 24,353 34.3 23,039 32.4 Other Input/Output Systems 2,043 13,372 -11,329 -84.7 -11,372 -85.0 Percentage of net sales (%) 0.5 3.2 Domestic 431 1,052 -621 -59.0 -621 -59.0 Overseas 1,612 12,320 -10,708 -86.9 -10,751 -87.3 Total Network Input/Output Systems 171,324 137,936 33,388 24.2 32,031 23.2 Percentage of net sales (%) 38.6 32.8 Domestic 74,354 54,611 19,743 36.2 19,743 36.2 Overseas 96,970 83,325 13,645 16.4 12,288 14.7 - ----------------------------------------------------------------------------------------------------------------------------------- Network System Solutions 43,531 41,623 1,908 4.6 1,879 4.5 Percentage of net sales (%) 9.8 9.9 Domestic 41,824 40,540 1,284 3.2 1,284 3.2 Overseas 1,707 1,083 624 57.6 595 54.9 - ----------------------------------------------------------------------------------------------------------------------------------- Office Equipment Total 393,172 368,592 24,580 6.7 21,971 6.0 Percentage of net sales (%) 88.6 87.6 Domestic 188,288 172,458 15,830 9.2 15,830 9.2 Overseas 204,884 196,134 8,750 4.5 6,141 3.1 The Americas 78,056 75,643 2,413 3.2 4,577 6.1 Europe 105,862 98,428 7,434 7.6 2,559 2.6 Other 20,966 22,063 -1,097 -5.0 -995 -4.5 - ----------------------------------------------------------------------------------------------------------------------------------- Other Businesses 50,627 52,311 -1,684 -3.2 -1,634 -3.1 Percentage of net sales (%) 11.4 12.4 Domestic 43,033 40,450 2,583 6.4 2,583 6.4 Overseas 7,594 11,861 -4,267 -36.0 -4,217 -35.6 The Americas 190 290 -100 -34.5 -95 -32.8 Europe 1,748 994 754 75.9 695 69.9 Other 5,656 10,577 -4,921 -46.5 -4,817 -45.5 - ----------------------------------------------------------------------------------------------------------------------------------- Grand Total 443,799 420,903 22,896 5.4 20,337 4.8 Percentage of net sales (%) 100.0 100.0 Domestic 231,321 212,908 18,413 8.6 18,413 8.6 Percentage of net sales (%) 52.1 50.6 Overseas 212,478 207,995 4,483 2.2 1,924 0.9 Percentage of net sales (%) 47.9 49.4 The Americas 78,246 75,933 2,313 3.0 4,482 5.9 Percentage of net sales (%) 17.6 18.0 Europe 107,610 99,422 8,188 8.2 3,254 3.3 Percentage of net sales (%) 24.2 23.6 Other 26,622 32,640 -6,018 -18.4 -5,812 -17.8 Percentage of net sales (%) 6.1 7.8 - ----------------------------------------------------------------------------------------------------------------------------------- Reference: Exchange rate US$ 1 Yen 106.01 Yen 108.92 Yen -2.91 EURO 1 Yen 137.16 Yen 129.58 Yen 7.58
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
(Nine months ended December 31, 2004 and 2003 and Year ended March 31, 2004) (Millions of yen) - ------------------------------------------------------------------------------------------------------------------------------------ Nine months ended Nine months ended Chnage excluding December 31, 2004 December 31, 2003 Change % exchange impact % March 31, 2004 - ------------------------------------------------------------------------------------------------------------------------------------ Imaging Solutions: Digital Imaging Systems 416,440 453,040 -36,600 -8.1 -31,466 -6.9 606,270 Percentage of net sales (%) 31.6 34.6 34.1 Domestic 170,564 184,789 -14,225 -7.7 -14,225 -7.7 253,830 Overseas 245,876 268,251 -22,375 -8.3 -17,241 -6.4 352,440 Other Imaging Systems 118,482 151,087 -32,605 -21.6 -31,594 -20.9 197,304 Percentage of net sales (%) 8.9 11.6 11.0 Domestic 46,382 53,788 -7,406 -13.8 -7,406 -13.8 70,762 Overseas 72,100 97,299 -25,199 -25.9 -24,188 -24.9 126,542 Total Imaging Solutions 534,922 604,127 -69,205 -11.5 -63,060 -10.4 803,574 Percentage of net sales (%) 40.5 46.2 45.1 Domestic 216,946 238,577 -21,631 -9.1 -21,631 -9.1 324,592 Overseas 317,976 365,550 -47,574 -13.0 -41,429 -11.3 478,982 - ----------------------------------------------------------------------------------------------------------------------------------- Network Input/Output Systems: Printing Systems 470,624 358,021 112,603 31.5 115,581 32.3 509,212 Percentage of net sales (%) 35.7 27.4 28.6 Domestic 201,898 153,910 47,988 31.2 47,988 31.2 218,165 Overseas 268,726 204,111 64,615 31.7 67,593 33.1 291,047 Other Input/Output Systems 11,022 43,097 -32,075 -74.4 -32,100 -74.5 49,025 Percentage of net sales (%) 0.8 3.2 2.8 Domestic 1,921 3,795 -1,874 -49.4 -1,874 -49.4 4,981 Overseas 9,101 39,302 -30,201 -76.8 -30,226 -76.9 44,044 Total Network Input/Output Systems 481,646 401,118 80,528 20.1 83,481 20.8 558,237 Percentage of net sales (%) 36.5 30.6 31.4 Domestic 203,819 157,705 46,114 29.2 46,114 29.2 223,146 Overseas 277,827 243,413 34,414 14.1 37,367 15.4 335,091 - ----------------------------------------------------------------------------------------------------------------------------------- Network System Solutions 142,569 138,855 3,714 2.7 3,743 2.7 195,822 Percentage of net sales (%) 10.8 10.6 11.0 Domestic 137,939 135,800 2,139 1.6 2,139 1.6 191,302 Overseas 4,630 3,055 1,575 51.6 1,604 52.5 4,520 - ----------------------------------------------------------------------------------------------------------------------------------- Office Equipment Total 1,159,137 1,144,100 15,037 1.3 24,164 2.1 1,557,633 Percentage of net sales (%) 87.8 87.4 87.5 Domestic 558,704 532,082 26,622 5.0 26,622 5.0 739,040 Overseas 600,433 612,018 -11,585 -1.9 -2,458 -0.4 818,593 The Americas 239,000 242,443 -3,443 -1.4 10,622 4.4 325,106 Europe 297,051 293,128 3,923 1.3 -2,532 -0.9 398,109 Other 64,382 76,447 -12,065 -15.8 -10,548 -13.8 95,378 - ----------------------------------------------------------------------------------------------------------------------------------- Other Businesses 160,665 164,893 -4,228 -2.6 -3,845 -2.3 222,612 Percentage of net sales (%) 12.2 12.6 12.5 Domestic 141,793 129,462 12,331 9.5 12,331 9.5 175,020 Overseas 18,872 35,431 -16,559 -46.7 -16,176 -45.7 47,592 The Americas 576 1,154 -578 -50.1 -542 -47.0 1,274 Europe 3,546 3,245 301 9.3 243 7.5 4,283 Other 14,750 31,032 -16,282 -52.5 -15,877 -51.2 42,035 - ----------------------------------------------------------------------------------------------------------------------------------- Grand Total 1,319,802 1,308,993 10,809 0.8 20,319 1.6 1,780,245 Percentage of net sales (%) 100.0 100.0 100.0 Domestic 700,497 661,544 38,953 5.9 38,953 5.9 914,060 Percentage of net sales (%) 53.1 50.5 51.3 Overseas 619,305 647,449 -28,144 -4.3 -18,634 -2.9 866,185 Percentage of net sales (%) 46.9 49.5 48.7 The Americas 239,576 243,597 -4,021 -1.7 10,080 4.1 326,380 Percentage of net sales (%) 18.2 18.6 18.3 Europe 300,597 296,373 4,224 1.4 -2,289 -0.8 402,392 Percentage of net sales (%) 22.8 22.6 22.6 Other 79,132 107,479 -28,347 -26.4 -26,425 -24.6 137,413 Percentage of net sales (%) 5.9 8.3 7.8 - ----------------------------------------------------------------------------------------------------------------------------------- Reference: Exchange rate US$ 1 Yen 108.55 Yen 115.00 Yen -6.45 Yen 113.09 EURO 1 Yen 34.60 Yen 132.17 Yen 2.43 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 A3 3. FORECAST OF CONSOLIDATED PERFORMANCE
(Billions of yen) - ------------------------------------------------------------------------------------------------------------------------------------ Half year ended Three months ended Three months ending Year ending Sept. 30, 2004 Change Dec. 31, 2004 Change Mar. 31, 2005 Change Mar. 31, 2005 Change Results % Results % Forecast % Forecast % - ------------------------------------------------------------------------------------------------------------------------------------ Net sales 876.0 -1.4 443.7 5.4 495.1 5.1 1,815.0 2.0 Gross profit 363.8 -6.2 192.1 3.4 208.0 8.5 764.0 -0.2 Operating income 57.7 -25.2 38.7 6.9 50.5 38.3 147.0 -2.0 Income before income taxes 60.0 -15.9 34.6 4.2 46.2 20.6 141.0 -1.4 Net income 35.8 -15.2 22.2 13.0 26.9 -9.7 85.0 -7.4 - ------------------------------------------------------------------------------------------------------------------------------------ Net income per share (yen) 48.48 - 30.08 - 36.51 - 115.07 - - ------------------------------------------------------------------------------------------------------------------------------------ Capital expenditure 38.2 - 20.5 - 20.2 - 79.0 - Depreciation for tangible fixed assets 31.0 - 16.9 - 19.4 - 67.5 - R&D expenditure 53.4 - 26.1 - 27.3 - 107.0 - - ------------------------------------------------------------------------------------------------------------------------------------ Exchange rate (Yen/US$) 109.83 - 106.01 - 105.00 - 107.67 - Exchange rate (Yen/EURO) 133.31 - 137.16 - 130.00 - 133.45 - - ------------------------------------------------------------------------------------------------------------------------------------
4. FORECAST OF CONSOLIDATED SALES BY PRODUCT CATEGORY
(Billions of yen) - ------------------------------------------------------------------------------------------------------------------------------------ Three months ending March 31, 2005 Year ending March 31, 2005 ---------------------------------- -------------------------- Forecast Change Forecast(*) Change Forecast Change Forecast(*) Change % % % % - ------------------------------------------------------------------------------------------------------------------------------------ Imaging Solutions: Digital Imaging Systems 136.6 -10.8 137.3 -10.4 553.1 -8.8 558.9 -7.8 Domestic 60.6 -12.2 60.6 -12.2 231.2 -8.9 231.2 -8.9 Overseas 76.0 -9.7 76.6 -8.9 321.9 -8.7 327.7 -7.0 Other Imaging Systems 36.0 -22.0 36.7 -20.6 154.5 -21.7 156.2 -20.8 Domestic 14.1 -16.8 14.1 -16.8 60.5 -14.5 60.5 -14.5 Overseas 21.9 -25.1 22.5 -22.8 94.0 -25.7 95.7 -24.4 Total Imaging Solutions 172.7 -13.4 174.0 -12.7 707.6 -11.9 715.1 -11.0 Domestic 74.7 -13.1 74.7 -13.1 291.7 -10.1 291.7 -10.1 Overseas 97.9 -13.6 99.2 -12.5 415.9 -13.2 423.4 -11.6 - ------------------------------------------------------------------------------------------------------------------------------------ Network Input/Output Systems: Printing Systems 209.5 38.6 213.4 41.2 680.1 33.6 687.0 34.9 Domestic 95.1 48.0 95.1 48.0 297.0 36.1 297.0 36.1 Overseas 114.4 31.6 118.3 36.1 383.1 31.6 390.0 34.0 Other Input/Output Systems 2.7 -52.9 2.8 -52.2 13.8 -71.8 13.8 -71.8 Domestic 0.6 -42.7 0.6 -42.7 2.6 -47.8 2.6 -47.8 Overseas 2.1 -55.4 2.1 -54.6 11.2 -74.5 11.2 -74.5 Total Network Input/Output Systems 212.2 35.1 216.2 37.6 693.9 24.3 700.8 25.5 Domestic 95.7 46.4 95.7 46.4 299.6 34.3 299.6 34.3 Overseas 116.5 27.1 120.4 31.4 394.3 17.7 401.2 19.7 - ------------------------------------------------------------------------------------------------------------------------------------ Network System Solutions 56.1 -1.5 56.2 -1.3 198.6 1.5 198.8 1.5 Domestic 53.6 -3.3 53.6 -3.3 191.6 0.2 191.6 0.2 Overseas 2.4 66.8 2.5 73.4 7.0 56.5 7.2 59.3 - ------------------------------------------------------------------------------------------------------------------------------------ Office Equipment Total 441.1 6.7 446.4 8.0 1,600.2 2.7 1,614.7 3.7 Domestic 224.1 8.3 224.1 8.3 782.9 5.9 782.9 5.9 Overseas 216.9 5.0 222.2 7.6 817.3 -0.2 831.8 1.6 The Americas 88.2 6.7 90.1 9.1 327.2 0.6 343.2 5.6 Europe 107.2 2.1 110.6 5.4 404.2 1.5 401.2 0.8 Other 21.4 13.5 21.5 13.7 85.8 -10.0 87.4 -8.3 - ------------------------------------------------------------------------------------------------------------------------------------ Other Businesses 54.0 -6.2 54.2 -6.0 214.8 -3.5 215.3 -3.3 Domestic 48.2 5.8 48.2 5.8 190.0 8.6 190.0 8.6 Overseas 5.8 -51.2 6.0 -50.3 24.8 -47.9 25.3 -46.8 The Americas 0.6 463.3 0.6 475.8 1.2 -1.7 1.3 2.0 Europe 1.4 41.2 1.5 45.7 5.0 17.0 5.0 16.7 Other 3.7 -65.5 3.8 -65.1 18.5 -55.9 19.0 -54.8 - ------------------------------------------------------------------------------------------------------------------------------------ Grand Total 495.1 5.1 500.7 6.3 1,815.0 2.0 1,830.0 2.8 Domestic 272.4 7.9 272.4 7.9 972.9 6.4 972.9 6.4 Overseas 222.7 1.9 228.3 4.4 842.1 -2.8 857.1 -1.0 The Americas 88.8 7.4 90.8 9.7 328.4 0.6 344.5 5.6 Europe 108.6 2.5 112.1 5.7 409.2 1.7 406.2 0.9 Other 25.2 -15.7 25.3 -15.2 104.4 -24.0 106.4 -22.5 - ------------------------------------------------------------------------------------------------------------------------------------ * Excluding foreign exchange impact
A4 -----END PRIVACY-ENHANCED MESSAGE-----