Form 6-K

6-K 1 d6k.htm FORM 6-K Form 6-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 6-K

Report of Foreign Private Issuer

Pursuant to Rule 13a-16 or 15d-16 of the

Securities Exchange Act of 1934

For the month of November 2008

Commission File Number 1-8910

NIPPON TELEGRAPH AND TELEPHONE CORPORATION

(Translation of registrant’s name into English)

3-1, OTEMACHI 2-CHOME

CHIYODA-KU, TOKYO 100-8116 JAPAN

(Address of principal executive offices)

Indicate by check mark whether the registrant files or will file annual reports under cover of 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 the registrant by furnishing the information contained in this Form 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- .

ANNOUNCEMENT OF FINANCIAL RESULTS FOR THE THREE AND SIX MONTHS ENDED SEPTEMBER 30, 2008

Attached is the registrant’s unaudited interim consolidated financial statements for the three and six months ended September 30, 2008, including the notes thereto, prepared on the basis of accounting principles generally accepted in the United States.

The attached financial statements were included in the registrant’s quarterly report which the registrant filed on November 10, 2008 with the Ministry of Finance of Japan. The registrant’s quarterly report filed with the Ministry of Finance included additional information not included in this report on Form 6-K. Such additional information is either immaterial or has been previously reported by the registrant. Most of the contents of this report on Form 6-K and the registrant’s quarterly report have previously been disclosed by the registrant in the registrant’s disclosure dated November 7, 2008, a copy of which was furnished under cover of Form 6-K on November 7, 2008.

The information included herein contains forward-looking statements. The registrant desires to qualify for the “safe-harbor” provisions of the Private Securities Litigation Reform Act of 1995, and consequently is hereby filing cautionary statements identifying important factors that could cause the registrant’s actual results to differ materially from any expectation of future results that may be derived from the forward-looking statements.

The registrant’s forward-looking statements are based on a series of assumptions, projections, estimates, judgments and beliefs of the management of the registrant in light of information currently available to it regarding the economy and the telecommunications industry in Japan in general. The forward-looking statements regarding the telecommunications industry may be affected by the registrant’s future business operations, the state of the economy in Japan and abroad, possible fluctuations in the securities markets, the pricing of services, the effects of competition, the performance of new products, services and new businesses, changes to laws and regulations affecting the telecommunications industry in Japan and elsewhere, other changes in circumstances that could cause actual results to differ materially from any future results that may be derived from the forward-looking statements, and the risk factors set forth in the registrant’s various filings with the Securities and Exchange Commission, including its most recently filed Annual Report on Form 20-F.

No assurance can be given that the registrant’s actual results will not vary significantly from any expectation of future results that may be derived from the forward-looking statements included herein.

The attached material is a translation of the Japanese original. The Japanese original is authoritative.

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.


NIPPON TELEGRAPH AND TELEPHONE CORPORATION

By		/s/ Koji Ito
Name:		Koji Ito
Title:		General Manager Finance and Accounting Department

Date: November 10, 2008

NYSE Timely Alert for November 10, 2008

Attached is an English translation of Nippon Telegraph and Telephone Corporation’s (“NTT”) unaudited interim consolidated financial statements for the three and six months ended September 30, 2008, including the notes thereto, prepared on the basis of accounting principles generally accepted in the United States. The attached financial statements were included in NTT’s quarterly report filed on November 10, 2008 with the Ministry of Finance of Japan. NTT’s quarterly report filed with the Ministry of Finance included additional information not included in the attached financial statements. Such additional information is either immaterial or has been previously disclosed by NTT. Most of the contents of the attached financial statements and NTT’s quarterly report have previously been disclosed by NTT in NTT’s disclosure dated November 7, 2008, a copy of which was furnished to the Securities and Exchange Commission under cover of Form 6-K on November 7, 2008. NTT plans to file the attached under separate cover of Form 6-K with the Securities and Exchange Commission, promptly hereafter. NTT is submitting the attached to the NYSE voluntarily to comply with the NYSE timely alert policy.

NIPPON TELEGRAPH AND TELEPHONE CORPORATION

AND ITS SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS (UNAUDITED)

Millions of yen

Millions of
U.S. dollars
(Note 2)

March 31,
2008

September 30,
2008

September 30,
2008

ASSETS

Current assets:

Cash and cash equivalents

1,169,566

943,671

9,162

Short-term investments

17,566

15,491

151

Notes and accounts receivable, trade

1,843,468

1,703,126

16,535

Allowance for doubtful accounts

(36,286

)

(37,346

)

(363

)

Inventories (Note 3)

343,978

445,978

4,330

Prepaid expenses and other current assets

375,661

498,976

4,844

Deferred income taxes

276,178

255,824

2,484

Total current assets

3,990,131

3,825,720

37,143

Property, plant and equipment:

Telecommunications equipment

14,699,272

14,848,863

144,164

Telecommunications service lines

13,701,735

13,813,583

134,112

Buildings and structures

5,792,345

5,796,494

56,277

Machinery, vessels and tools

1,761,348

1,778,585

17,268

Land

1,078,118

1,085,043

10,534

Construction in progress

301,722

335,994

3,262

37,334,540

37,658,562

365,617

Accumulated depreciation

(26,948,961

)

(27,358,382

)

(265,615

)

Net property, plant and equipment

10,385,579

10,300,180

100,002

Investments and other assets:

Investments in affiliated companies

416,140

420,463

4,082

Marketable securities and other investments (Note 4)

347,899

311,956

3,029

Goodwill (Note 9)

427,888

434,189

4,215

Other intangibles

1,384,311

1,356,413

13,169

Other assets

959,096

1,020,932

9,912

Deferred income taxes

607,735

640,804

6,221

Total investments and other assets

4,143,069

4,184,757

40,628

Total assets

18,518,779

18,310,657

177,773

The accompanying notes are an integral part of these financial statements.

NIPPON TELEGRAPH AND TELEPHONE CORPORATION

AND ITS SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS (UNAUDITED)

Millions of yen

Millions of
U.S. dollars
(Note 2)

March 31,
2008

September 30,
2008

September 30,
2008

LIABILITIES, MINORITY INTERESTS AND SHAREHOLDERS’ EQUITY

Current liabilities:

Short-term borrowings

568,068

594,256

5,769

Current portion of long-term debt

659,598

734,984

7,136

Accounts payable, trade

1,492,450

978,864

9,504

Accrued payroll

466,689

401,056

3,894

Accrued interest

11,809

10,637

103

Accrued taxes on income

234,074

227,644

2,210

Accrued consumption tax

36,074

34,764

338

Advances received

98,261

117,323

1,139

Other

344,886

332,816

3,231

Total current liabilities

3,911,909

3,432,344

33,324

Long-term liabilities:

Long-term debt

3,416,740

3,433,238

33,332

Obligations under capital leases

60,488

64,446

626

Liabilities for employees’ retirement benefits

1,294,813

1,284,379

12,470

Other

560,070

561,613

5,452

Total long-term liabilities

5,332,111

5,343,676

51,880

Minority interests in consolidated subsidiaries

1,863,998

1,912,665

18,569

Shareholders’ equity:

Common stock, no par value (Note 6) -
Authorized - 61,929,209 shares
Issued - 15,741,209 shares at March 31 and September 30, 2008

937,950

937,950

9,106

Additional paid-in capital

2,841,079

2,841,105

27,584

Retained earnings (Note 6)

4,663,296

5,008,274

48,624

Accumulated other comprehensive income (loss)

(26,428

)

(59,447

)

(577

)

Treasury stock, at cost (Note 6) -
2,102,471 shares at March 31, 2008 and
2,293,126 shares at September 30, 2008

(1,005,136

)

(1,105,910

)

(10,737

)

Total shareholders’ equity

7,410,761

7,621,972

74,000

Contingent liabilities (Note 10)

Total liabilities, minority interests and shareholders’ equity

18,518,779

18,310,657

177,773

Yen

U.S. dollars
(Note 2)

March 31,
2008

September 30,
2008

September 30,
2008

Per share of common stock:

Net assets

543,361.19

566,770.15

5,502.62

The accompanying notes are an integral part of these financial statements.

NIPPON TELEGRAPH AND TELEPHONE CORPORATION

AND ITS SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)

SIX-MONTH PERIOD ENDED SEPTEMBER 30


	Millions of yen			Millions of U.S. dollars (Note 2)
	2008			2008
Operating revenues:
Fixed voice related services	¥	1,315,716		$	12,774
Mobile voice related services		1,179,627			11,453
IP/packet communications services		1,416,757			13,755
Sale of telecommunications equipment		369,321			3,585
System integration		541,444			5,257
Other		341,728			3,318

		5,164,593			50,142

Operating expenses (Note 8):
Cost of services (exclusive of items shown separately below)		1,161,911			11,281
Cost of equipment sold (exclusive of items shown separately below)		459,941			4,465
Cost of system integration (exclusive of items shown separately below)		344,082			3,341
Depreciation and amortization		1,020,780			9,910
Impairment loss		401			4
Selling, general and administrative expenses		1,432,396			13,907

		4,419,511			42,908

Operating income		745,082			7,234

Other income (expenses):
Interest and amortization of bond discounts and issue costs		(30,134	)		(293	)
Interest income		12,602			122
Others, net		43,611			424

		26,079			253

Income (loss) before income taxes, minority interests and equity in earnings (losses) of affiliated companies		771,161			7,487

Income tax expense (benefit):
Current		338,954			3,291
Deferred		(102,279	)		(993	)

		236,675			2,298

Income (loss) before minority interests and equity in earnings (losses) of affiliated companies		534,486			5,189
Minority interests in consolidated subsidiaries		(135,554	)		(1,316	)
Equity in earnings (losses) of affiliated companies		7,421			72

Net income (loss)	¥	406,353		$	3,945

Summary of total comprehensive income (loss):
Net income (loss)	¥	406,353		$	3,945
Other comprehensive income (loss)		(33,019	)		(320	)

Comprehensive income (loss)	¥	373,334		$	3,625


	Shares or yen			U.S. dollars (Note 2)
	2008			2008
Per share of common stock:
Weighted average number of shares outstanding		13,572,763.01
Net income (loss)	¥	29,938.86		$	290.67

The accompanying notes are an integral part of these financial statements.

NIPPON TELEGRAPH AND TELEPHONE CORPORATION

AND ITS SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)

THREE-MONTH PERIOD ENDED SEPTEMBER 30


	Millions of yen			Millions of U.S. dollars (Note 2)
	2008			2008
Operating revenues:
Fixed voice related services	¥	652,186		$	6,332
Mobile voice related services		580,695			5,638
IP/packet communications services		721,691			7,007
Sale of telecommunications equipment		152,947			1,485
System integration		285,208			2,769
Other		178,278			1,731

		2,571,005			24,962

Operating expenses (Note 8):
Cost of services (exclusive of items shown separately below)		585,879			5,688
Cost of equipment sold (exclusive of items shown separately below)		193,428			1,878
Cost of system integration (exclusive of items shown separately below)		184,309			1,789
Depreciation and amortization		517,024			5,020
Impairment loss		401			4
Selling, general and administrative expenses		716,945			6,961

		2,197,986			21,340

Operating income		373,019			3,622

Other income (expenses):
Interest and amortization of bond discounts and issue costs		(14,952	)		(145	)
Interest income		6,279			61
Others, net		18,914			183

		10,241			99

Income (loss) before income taxes, minority interests and equity in earnings (losses) of affiliated companies		383,260			3,721

Income tax expense (benefit) (Note 5):
Current		189,900			1,843
Deferred		(101,485	)		(985	)

		88,415			858

Income (loss) before minority interests and equity in earnings (losses) of affiliated companies		294,845			2,863
Minority interests in consolidated subsidiaries		(67,912	)		(659	)
Equity in earnings (losses) of affiliated companies		3,886			37

Net income (loss)	¥	230,819		$	2,241

Summary of total comprehensive income (loss):
Net income (loss)	¥	230,819		$	2,241
Other comprehensive income (loss)		(3,211	)		(31	)

Comprehensive income (loss)	¥	227,608		$	2,210


	Shares or yen			U.S. dollars (Note 2)
	2008			2008
Per share of common stock:
Weighted average number of shares outstanding		13,507,409.88
Net income (loss)	¥	17,088.32		$	165.91

The accompanying notes are an integral part of these financial statements.

NIPPON TELEGRAPH AND TELEPHONE CORPORATION

AND ITS SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)

SIX-MONTH PERIOD ENDED SEPTEMBER 30


	Millions of yen			Millions of U.S. dollars (Note 2)
	2008			2008
Cash flows from operating activities:
Net income (loss)	¥	406,353		$	3,945
Adjustments to reconcile net income (loss) to net cash provided by operating activities -
Depreciation and amortization		1,020,780			9,910
Impairment loss		401			4
Deferred taxes		(102,279	)		(993	)
Minority interests in consolidated subsidiaries		135,554			1,316
Loss on disposal of property, plant and equipment		45,473			441
Equity in (earnings) losses of affiliated companies		(7,421	)		(72	)
(Increase) decrease in notes and accounts receivable, trade		157,971			1,534
(Increase) decrease in inventories		(101,950	)		(990	)
(Increase) decrease in other current assets		(85,482	)		(830	)
Increase (decrease) in accounts payable, trade and accrued payroll		(389,742	)		(3,784	)
Increase (decrease) in accrued consumption tax		(1,314	)		(13	)
Increase (decrease) in accrued interest		(1,163	)		(11	)
Increase (decrease) in advances received		19,014			185
Increase (decrease) in accrued taxes on income		(6,334	)		(61	)
Increase (decrease) in other current liabilities		(14,057	)		(136	)
Increase (decrease) in liabilities for employees’ retirement benefits		(9,061	)		(88	)
Increase (decrease) in other long-term liabilities		21,673			210
Other		774			8

Net cash provided by operating activities		1,089,190			10,575

Cash flows from investing activities:
Payments for property, plant and equipment		(850,669	)		(8,259	)
Proceeds from sale of property, plant and equipment		46,309			449
Payments for purchase of non-current investments		(66,044	)		(641	)
Proceeds from sale and redemption of non-current investments		38,899			378
Payments for purchase of short-term investments		(2,541	)		(25	)
Proceeds from redemption of short-term investments		4,494			44
Acquisition of intangible and other assets		(320,496	)		(3,112	)

Net cash used in investing activities	¥	(1,150,048	)	$	(11,166	)

The accompanying notes are an integral part of these financial statements.

NIPPON TELEGRAPH AND TELEPHONE CORPORATION

AND ITS SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)

SIX -MONTH PERIOD ENDED SEPTEMBER 30


	Millions of yen			Millions of U.S. dollars (Note 2)
	2008			2008
Cash flows from financing activities:
Proceeds from issuance of long-term debt	¥	395,173		$	3,837
Payments for settlement of long-term debt		(292,575	)		(2,841	)
Dividends paid (Note 6)		(61,375	)		(596	)
Proceeds from sale of (payments for acquisition of) treasury stock, net		(100,748	)		(978	)
Acquisition of treasury stocks by subsidiary (Note 9)		(51,848	)		(503	)
Net increase (decrease) in short-term borrowings and other		(50,673	)		(492	)

Net cash provided by (used in) financing activities		(162,046	)		(1,573	)

Effect of exchange rate changes on cash and cash equivalents		(2,991	)		(29	)

Net increase (decrease) in cash and cash equivalents		(225,895	)		(2,193	)
Cash and cash equivalents at beginning of period		1,169,566			11,355

Cash and cash equivalents at end of period	¥	943,671		$	9,162

Cash paid during the period for:
Interest	¥	31,306		$	304
Income taxes, net	¥	261,362		$	2,537

The accompanying notes are an integral part of these financial statements.

NIPPON TELEGRAPH AND TELEPHONE CORPORATION

AND ITS SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

1.	Summary of significant accounting policies:

As permitted by Section 93 of “Regulation Concerning the Terminology, Forms and Preparation Methods of Quarterly Consolidated Financial Statements” (Japanese Cabinet Office Ordinance No. 64 of 2007), the accompanying consolidated balance sheets at March 31 and September 30, 2008 and the consolidated statements of income for the three and six months ended September 30, 2008 and cash flows for the six months ended September 30, 2008 of Nippon Telegraph and Telephone Corporation (“NTT”) and its subsidiaries (“NTT Group”) have been prepared in accordance with accounting principles generally accepted in the United States of America.

(1) Application of New Accounting Standards

Fair Value Measurements

Effective April 1, 2008, NTT Group adopted Statement of Financial Accounting Standards No. 157 (“SFAS 157”), “Fair Value Measurements.” SFAS 157 defines fair value, establishes a framework for measuring fair value and expands disclosures about fair value measurements. The definition of fair value retains the exchange price notion and SFAS 157 clarifies that the exchange price is the price in an orderly transaction between market participants to sell an asset or transfer a liability at the measurement date. SFAS 157 emphasizes that fair value is a market-based measurement and not an entity-specific measurement. It also establishes a fair value hierarchy used in fair value measurements and expands the required disclosures of assets and liabilities measured at fair value. The adoption of SFAS 157 did not have a material impact on the results of operations or financial position of NTT Group. The disclosure required by SFAS 157 was omitted in this report.

The Fair Value Option for Financial Assets and Financial Liabilities

Effective April 1, 2008, NTT Group adopted Statement of Financial Accounting Standards No. 159 (“SFAS 159”), “The Fair Value Option for Financial Assets and Financial Liabilities - Including an amendment of the Financial Accounting Standards Board (“FASB”) Statement No. 115.” SFAS 159 permits entities to choose to measure many financial instruments and certain other items at fair value that are not currently required to be measured at fair value. Subsequent changes in fair value for designated items will be required to be reported in earnings in the current period. SFAS 159 also establishes presentation and disclosure requirements for similar types of assets and liabilities measured at fair value. NTT Group has not elected the fair value option upon adoption of SFAS 159 for the six months ended September 30, 2008.

(2) Recent Pronouncements

In December 2007, the FASB revised Statement of Financial Accounting Standards No. 141 (“SFAS 141R”), “Business Combinations.” SFAS 141R requires use of the acquisition method of accounting, defines the acquirer, establishes the acquisition date and broadens the scope to all transactions and other events in which one entity obtains control over one or more other businesses. This statement is effective for business combinations or transactions entered into for fiscal years beginning on or after December 15, 2008. The impact of the adoption of SFAS No. 141R will depend on future business combination transactions.

In December 2007, the FASB issued Statement of Financial Accounting Standards No. 160 (“SFAS 160”), “Noncontrolling Interests in Consolidated Financial Statements – an amendment of ARB No. 51.” SFAS 160 establishes accounting and reporting standards for the noncontrolling interest (previously referred to as minority interests) in a subsidiary and for the deconsolidation of a subsidiary. SFAS 160 requires single method of accounting as equity transactions for changes in a parent’s ownership interest in a subsidiary that do not result in deconsolidation. This statement is effective for financial statements issued for fiscal years beginning on or after December 15, 2008. Management is currently evaluating the impact of the adoption of SFAS 160 on its results of operations and financial position.

In March 2008, the FASB issued Statement of Financial Accounting Standards No. 161 (“SFAS 161”), “Disclosures about Derivative Instruments and Hedging Activities – an amendment of FASB Statement No. 133.” SFAS 161 requires companies with derivative instruments to disclose information that should enable financial-statement users to understand how and why a company uses derivative instruments, how derivative instruments and related hedged items are accounted for under SFAS 133, and how derivative instruments and related hedged items affect a company’s financial position, financial performance, and cash flows. This Statement is effective prospectively for interim periods and fiscal years beginning after November 15, 2008. Management is currently evaluating the impact of the adoption of SFAS 161 on its disclosure about derivative instruments and hedging activities.

In May 2008, the FASB issued Statement of Financial Accounting Standards No. 162 (“SFAS 162”), “The Hierarchy of Generally Accepted Accounting Principles.” SFAS 162 makes the hierarchy of generally accepted accounting principles explicitly and directly applicable to preparers of financial statements, a step that recognizes preparers’ responsibilities for selecting the accounting principles for their financial statements. The effective date of SFAS 162 is 60 days following the U.S. Securities and Exchange Commission’s approval of the Public Company Accounting Oversight Board’s related amendments to remove the GAAP hierarchy from auditing standards, where it has resided for some time. The adoption of SFAS 162 will not have an impact on the results of operations or financial position of NTT Group.

In May 2008, the FASB issued Statement of Financial Accounting Standards No. 163 (“SFAS 163”), “Accounting for Financial Guarantee Insurance Contracts – an interpretation of FASB Statement No. 60.” SFAS 163 prescribes accounting for insurers of financial obligations, bringing consistency to recognizing and recording premiums and to loss recognition. SFAS 163 also requires expanded disclosures about financial guarantee insurance contracts. Except for some disclosures, SFAS 163 is effective for financial statements issued for fiscal years beginning after December 15, 2008. The adoption of SFAS 163 will not have an impact on the results of operations or financial position of NTT Group.

(3) Net Income per Share

Basic net income per share is computed based on the average number of shares outstanding during the period and is appropriately adjusted for any free distribution of common stock. Diluted net income per share assumes the dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock or resulted in the issuance of common stock. Since NTT did not issue dilutive securities, there is no difference between basic net income per share and diluted net income per share.

(4) Reclassifications

Certain items for prior periods’ financial statements have been reclassified to conform to the presentation for the three and six months ended September 30, 2008.

2.	Convenience translation into U.S. dollar amounts:

U.S. dollar amounts are included solely for convenience. These translations should not be construed as representations that the yen amounts actually represent, or have been or could be converted into, U.S. dollars. As the amounts shown in U.S. dollars are for convenience only, the rate of ¥103 = US$1, the approximate current rate at September 30, 2008, has been used for the purpose of presentation of the U.S. dollar amounts in the accompanying consolidated financial statements.

3.	Inventories:

Inventories at March 31 and September 30, 2008 comprised the following:


	Millions of yen				Millions of U.S. dollars
	March 31, 2008		September 30, 2008		September 30, 2008
Telecommunications equipment to be sold and materials	¥	163,654	¥	205,498	$	1,995
Projects in progress		144,287		202,461		1,966
Supplies		36,037		38,019		369

Total	¥	343,978	¥	445,978	$	4,330

4.	Marketable securities and other investments:

Marketable securities and other investments include available-for-sale securities and held-to-maturity securities. The aggregate carrying amounts, gross unrealized holding gains, gross unrealized holding losses and fair value by major security type at March 31 and September 30, 2008, are as follows:


	Millions of yen
	March 31, 2008
	Cost		Gross unrealized gains		Gross unrealized losses		Fair value
Available-for-sale:
Equity securities	¥	198,725	¥	69,596	¥	23,781	¥	244,540
Debt securities		3,299		8		193		3,114
Held-to-maturity:
Debt securities		10,145		176		3		10,318

Total	¥	212,169	¥	69,780	¥	23,977	¥	257,972

Millions of yen

September 30, 2008

Cost

Gross
unrealized
gains

Gross
unrealized
losses

Fair value

Available-for-sale:

Equity securities

180,645

53,187

27,854

205,978

Debt securities

3,642

318

3,326

Held-to-maturity:

Debt securities

9,541

9,607

Total

193,828

53,258

28,175

218,911


	Millions of U.S. dollars
	September 30, 2008
	Cost		Gross unrealized gains		Gross unrealized losses		Fair value
Available-for-sale:
Equity securities	$	1,754	$	516	$	270	$	2,000
Debt securities		35		0		3		32
Held-to-maturity:
Debt securities		92		1		0		93

Total	$	1,881	$	517	$	273	$	2,125

In the ordinary course of business, NTT maintains long-term investment securities, which are included in “Marketable securities and other investments.” The total carrying amounts of the investment securities accounted for under the cost method were ¥90,100 million and ¥93,111 million ($904 million) at March 31 and September 30, 2008, respectively.

5.	Income taxes:

In July 2008, NTT DoCoMo reorganized its group structure by integrating eight regional subsidiaries, consolidating its nationwide business operations under a single entity. This consolidation reduced taxable temporary difference between NTT’s book basis and tax basis of its investment in NTT DoCoMo and resulted in decrease in income tax expense by ¥56,920 million ($553 million) in the consolidated statement of income for the three months ended September 30, 2008.

6.	Shareholders’ equity:

Outstanding shares and Treasury stock–

The changes in the number of outstanding shares and treasury stock for the six months ended September 30, 2008 were as follows:


	Shares
	The number of outstanding shares	The number of treasury stock
March 31, 2008	15,741,209	2,102,470.82

Acquisition of treasury stock through purchase of fractional shares	—	2,339.83

Purchase of treasury stock under resolution of the board of directors	—	189,251.00

Resale of treasury stock to fractional shareholders	—	(935.68	)

September 30, 2008	15,741,209	2,293,125.97

With the scheduled implementation in January 2009 of the “Law for partial amendments to the Law concerning Book-Entry Transfer of Corporate Bonds and Other Securities for the Purpose of Streamlining the Settlement of Trades of Stocks and Other Securities (Law No. 88 of 2004)” (“Settlement Streamlining Law”), share certificates of listed companies are to take electronic form.

With the introduction of the electronic share certificate system, fractional shares will need to be eliminated. In conjunction with this process, in order to ensure that the transition away from the fractional share system will be smooth, the board of directors, at its meeting held on May 13, 2008, resolved that, subject to approval at the 23rd general shareholders meeting to be held on June 25, 2008, of the introduction of unit share system, and the approval of the Minister of Internal Affairs and Communications, on the day immediately preceding the day on which the electronic share certificate system will be introduced, one share of common stock will be split into 100 shares, and the number of shares constituting one unit will be set at 100. This resolution was approved at the 23rd general shareholders meeting and by the Minister of Internal Affairs and Communications on June 25, 2008.

Net Assets per Share at March 31 and September 30, 2008 would be as follows, if such share split was assumed to have taken place at the beginning of the year ended March 31, 2008 and the year ending March 31, 2009, respectively.


	Yen				U.S. dollars
	March 31, 2008		September 30, 2008		September 30, 2008
Net Assets per Share	¥	5,433.61	¥	5,667.70	$	55.03

Net Income (Loss) per Share for the three and six months ended September 30, 2008 would be as follows, if such share split was assumed to have taken place at the beginning of the year ending March 31 2009.


	Yen		U.S. dollars
For the three months ended September 30	2008		2008
Net Income (Loss) per Share	¥	170.88	$	1.66


	Yen		U.S. dollars
For the six months ended September 30	2008		2008
Net Income (Loss) per Share	¥	299.39	$	2.91

On May 13, 2008, the board of directors resolved that NTT may acquire up to 450,000 outstanding shares of its common stock at an amount in total not exceeding ¥200 billion from May 14, 2008 through March 24, 2009. Based on this resolution, NTT acquired 189,251 shares of its common stock for a total purchase price of ¥100,000 million ($971 million) from July through August 2008.

As described in the preceding paragraph, one share of common stock will be split into 100 shares on the day immediately preceding the day on which the electronic share certificate system will be introduced. After the share split, the maximum number of shares to be repurchased will be a number calculated by first subtracting the number of shares acquired before the share split from 450,000 shares, multiplying the remainder by 100, and then adding the number of shares acquired before the share split.

Dividend –


(1) Cash dividends paid

Resolution		The shareholders’ meeting on June 25, 2008
Class of shares		Common stock
Source of dividends		Retained earnings
Total cash dividends paid		¥61,374 million ($596 million)
Cash dividends per share		¥4,500 ($44)
Date of record		March 31, 2008
Date of payment		June 26, 2008

(2) Cash dividends declared

Resolution		The Board of Directors’ meeting on November 7, 2008
Class of shares		Common stock
Source of dividends		Retained earnings
Total cash dividends declared		¥73,964 million ($718 million)
Cash dividends per share		¥5,500 ($53)
Date of record		September 30, 2008
Date of payment		December 9, 2008

7.	Business segment and geographic area:

The operating segments reported below are those for which segment-specific financial information is available. NTT Group’s management uses this financial information to make decisions on the allocation of management resources and to evaluate business performance. Accounting policies used to determine segment profit/loss are consistent with those used to prepare the consolidated financial statements in accordance with accounting principles generally accepted in the United States.

The regional communications business segment principally comprises revenues from fixed voice related services, IP/packet communications services, sales of telecommunications equipment, and other operating revenues.

The long distance and international communications business segment principally comprises revenues from fixed voice related services, IP/packet communications services, sales of telecommunications equipment, and other operating revenues.

The mobile communications business segment principally comprises revenues from mobile voice related services, IP/packet communications services, sales of telecommunications equipment, and other operating revenues.

The data communications business segment principally comprises revenues from system integration services.

The other business segment principally comprises operating revenues from such activities as building-maintenance, real estate rental, systems development, leasing, and research and development.

Business segments -

Sales and operating revenue:


	Millions of Yen			Millions of U.S. dollars
For the three months ended September 30	2008
Regional communications business -
Customers	¥	867,435		$	8,422
Intersegment		145,810			1,415

Total		1,013,245			9,837
Long distance and international communications business -
Customers		293,147			2,846
Intersegment		31,814			309

Total		324,961			3,155
Mobile communications business -
Customers		1,086,853			10,552
Intersegment		10,685			104

Total		1,097,538			10,656
Data communications business -
Customers		233,584			2,268
Intersegment		31,867			309

Total		265,451			2,577
Other -
Customers		89,986			874
Intersegment		201,609			1,957

Total		291,595			2,831
Elimination		(421,785	)		(4,095	)

Consolidated total	¥	2,571,005		$	24,961


	Millions of yen			Millions of U.S. dollars
For the six months ended September 30	2008
Regional communications business -
Customers	¥	1,725,745		$	16,755
Intersegment		282,607			2,744

Total		2,008,352			19,499
Long distance and international communications business -
Customers		581,141			5,642
Intersegment		55,306			537

Total		636,447			6,179
Mobile communications business -
Customers		2,243,360			21,780
Intersegment		24,424			237

Total		2,267,784			22,017
Data communications business -
Customers		446,481			4,335
Intersegment		60,818			590

Total		507,299			4,925
Other -
Customers		167,866			1,630
Intersegment		391,325			3,799

Total		559,191			5,429
Elimination		(814,480	)		(7,907	)

Consolidated total	¥	5,164,593		$	50,142

Segment profit or loss:


	Millions of Yen		Millions of U.S. dollars
For the three months ended September 30	2008
Operating income (loss):
Regional communications business	¥	29,526	$	287
Long distance and international communications business		27,518		267
Mobile communications business		279,069		2,709
Data communications business		23,198		225
Other		9,220		90

Total		368,531		3,578
Elimination		4,488		44

Consolidated operating income	¥	373,019	$	3,622


	Millions of Yen		Millions of U.S. dollars
For the six months ended September 30	2008
Operating income (loss):
Regional communications business	¥	40,700	$	395
Long distance and international communications business		55,430		538
Mobile communications business		574,208		5,575
Data communications business		44,851		436
Other		23,407		227

Total		738,596		7,171
Elimination		6,486		63

Consolidated operating income	¥	745,082	$	7,234

Transfers between reportable businesses are made at arms-length prices. Operating income is sales and operating revenues less costs and operating expenses.

Geographic information is not presented due to immateriality of revenue attributable to international customers.

There have been no sales and operating revenue from transactions with a single external customer amounting to 10% or more of NTT’s revenues for the three and six months ended September 30, 2008.

8.	Research and development expenses:

Research and development expenses are charged to income as incurred and such amounts charged to income for the three and six months ended September 30, 2008 were ¥64,456 million ($626 million) and ¥120,081 million ($1,166 million), respectively.

9.	Subsidiary stock transactions:

In May 2008, NTT DoCoMo repurchased 311,322 shares for ¥49,997 million ($485 million). As a result, NTT’s interest in NTT DoCoMo increased from 64.8% to 65.3%. Goodwill of ¥10,236 million ($99 million) was recorded on the balance sheet as of June 30, 2008 related to the repurchase transactions.

Repurchases of shares by NTT DoCoMo resulting in increases in NTT’s ownership interest in NTT DoCoMo have been accounted for as acquisitions of minority interests using the purchase method.

10.

Contingent liabilities:

Contingent liabilities at September 30, 2008 for loans guaranteed amounted to ¥9,841 million ($96 million).

At September 30, 2008, NTT Group had no material litigation or claims outstanding, pending or threatened against it, which would have a material adverse effect on NTT’s consolidated financial position or results of operations.

11.

Subsequent events:

On September 29, 2008, the board of directors resolved that NTT may raise up to ¥130 billion ($1,262 million) by issuing bonds or incurring long-term borrowings during the period from October 1 to December 31, 2008. Based on this resolution, NTT issued bonds as follows:


Series 55 Nippon Telegraph and Telephone straight bonds
Date of payment		October 31, 2008
Issue amount		¥70 billion ($680 million)
Issue price		¥100 per ¥100
Interest rate		1.22%
Date of maturity		October 31, 2012
Use of proceeds		Purchase of treasury stock and operating cash