Form 6-K
Table of Contents

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 July 2003

 

Commission File Number: 1-07952

 

KYOCERA CORPORATION

 

6 Takeda Tobadono-cho, Fushimi-ku,

Kyoto 612-8501, Japan

 

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 Registration S-T Rule 101(b)(1): ¨

 

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Registration 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-


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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, thereto duly authorized.

 

KYOCERA CORPORATION

/s/    HIDEKI ISHIDA


Hideki Ishida

Managing Executive Officer

General Manager of

Corporate Business Systems

Administration Division

 

Date: July 29, 2003

 


Table of Contents

Information furnished on this form:

 

EXHIBITS

 

Exhibit
Number


    
1.   

Consolidated Financial Results for the Three Months Ended June 30, 2003

 


Table of Contents

LOGO

July 29, 2003

 

Kyocera Corporation

 

Consolidated Financial Highlights (Unaudited)

Results for the Three Months Ended June 30, 2003

 

     Three Months Ended
June 30,


   Increase
(Decrease)
(%)


 
     2003

   2002

  
     (Yen in millions, except
per share amounts and
exchange rates)
      

Net sales

   253,126    253,930    (0.3 )

Profit from operations

   12,798    22,242    (42.5 )

Income before income taxes

   16,442    16,375    0.4  

Net income

   10,730    7,391    45.2  

Average exchange rates :

                

US$

   118    127    —    

Euro

   135    117    —    

Earnings per share :

                

Net income

                

Basic

   58.01    39.10    —    

Diluted

   58.01    39.07    —    

Capital expenditures

   14,147    9,474    49.3  

Depreciation

   14,021    15,564    (9.9 )

R&D expenses

   12,243    11,376    7.6  

Total assets

   1,700,020    1,618,148    —    

Stockholders’ equity

   1,053,922    1,028,996    —    

Sales of products manufactured outside Japan to net sales (%)

   36.0    37.5    —    

 

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Consolidated Results of Kyocera Corporation and its Subsidiaries

for the Three Months Ended June 30, 2003

 

1.   The basic items on preparation for consolidated results for the three months ended June 30, 2003 :

 

  (1)   The consolidated financial statements are prepared in conformity with accounting principles generally accepted in the United States of America.

 

  (2)   Change in accounting principle : None

 

  (3)   Changes in scope of consolidation and application of the equity method :

 

     Consolidation

   Equity method

Increase

   5    0

Decrease

   0    1

 

2.   Consolidated financial information for the three months ended June 30, 2003 :

 

  (1)   Consolidated results of operations :

 

     Three months ended June 30,

   Year ended
March 31,


 
     2003

    2002

   2003

 

Net sales

   ¥ 253,126 million     ¥ 253,930 million    ¥ 1,069,770 million  

% change from the previous period

     (0.3 )%     —        3.4 %

Profit from operations

     12,798 million       22,242 million      83,388 million  

% change from the previous period

     (42.5 )%     —        61.7 %

Income before income taxes

     16,442 million       16,375 million      76,037 million  

% change from the previous period

     0.4 %     —        37.3 %

Net income

     10,730 million       7,391 million      41,165 million  

% change from the previous period

     45.2 %     —        28.8 %

Earnings per share :

                       

Basic

   ¥ 58.01     ¥ 39.10    ¥ 220.91  

Diluted

     58.01       39.07      220.86  

 

  (2)   Consolidated financial condition :

 

     As of June 30,

    As of March 31,

 
     2003

    2002

    2003

 

Total assets

   ¥ 1,700,020 million     ¥ 1,618,148 million     ¥ 1,635,014 million  

Stockholders’ equity

     1,053,922 million       1,028,996 million       1,003,500 million  

Stockholders’ equity to total assets

     62.0 %     63.6 %     61.4 %

Stockholders’ equity per share

   ¥ 5,698.04     ¥ 5,443.15     ¥ 5,425.37  

 

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Consolidated cash flows :

 

     Three months ended June 30,

   Year ended
March 31,


     2003

   2002

   2003

Cash flows from operating activities

   ¥ 6,919 million    ¥ 50,181 million    ¥ 160,754 million

Cash flows from investing activities

     2,841 million      (25,769) million      (58,512) million

Cash flows from financing activities

     (9,391) million      (14,269) million      (74,662) million

Cash and cash equivalents at end of period

     299,632 million      280,777 million      298,310 million

 

3.   Consolidated financial forecasts for the year ending March 31, 2004 and the six months ending September 30, 2003:

 

There are no changes in the forecast, which were announced in April 25, 2003. (Please refer to the accompanying "Forward Looking Statements" on page 7 with regard to the forecasts.)

 

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Financial Results and Condition for the Three Months Ended June 30, 2003,

and Prospects for the Year Ending March 31, 2004

 

1.   Overview of the Three Months Ended June 30, 2003

 

1)   Economic Situation and Business Environment

 

Although the stock market rose and there were signs of a recovery in personal consumption in the United States during the first quarter, the U.S. economy did not recover, due in part to a continued slump in the production capacity utilization ratio for the manufacturing industry. Further, the European economy weakened overall, and the Asian economy was negatively impacted by Severe Acute Respiratory Syndrome (SARS), which dulled consumption in the Chinese market. Together with the continued downturn in personal consumption and capital investment, these blows to the world economy combined to weaken the Japanese economy.

 

In the electronics industry, shipments of personal computers during the quarter increased year-on-year. However, due to lower-than-expected production of mobile handsets in China because of the impact of SARS, and to a downward trend in mobile handsets production in Europe and Korea, the global demand for mobile handset components fell short of forecasts.

 

2)   Consolidated Financial Results

 

     Three Months Ended
June 30,


  

Increase
(Decrease)

(%)


 
     2003

   2002

  
     (Yen in millions)       

Net sales

   253,126    253,930    (0.3 )

Profit from operations

   12,798    22,242    (42.5 )

Income before income taxes

   16,442    16,375    0.4  

Net income

   10,730    7,391    45.2  

US$ average exchange rate (yen)

   118    127    —    

Euro average exchange rate (yen)

   135    117    —    

 

Although Kyocera Corporation and its consolidated subsidiaries (Kyocera) endeavored to expand sales of new products and develop new markets, weaker-than-expected demand during the first quarter, along with the impact of falling prices, resulted in a year-on-year decline in component sales such as Fine Ceramics Group and Electronic Device Group. Sales of Equipment Group were also down slightly year-on-year, despite an increase in sales of information equipment, due to the decline in mobile handset sales in the United States.

 

Sales of Others increased compared with the previous same period, because of the consolidation of Kyocera Chemical Corporation (Kyocera Chemical) into Kyocera in August 2002 and the contribution to the first quarter results for this fiscal year. As a whole, consolidated net sales during the first quarter were ¥253.1 billion, slightly down 0.3% from the same period of the previous year.

 

Profit from operations for the first quarter of the year ending March 31, 2004 decreased, as compared with the corresponding quarter of the previous fiscal year, due principally to a ¥4.6 billion revaluation gain recorded in the first quarter of the previous fiscal year in respect of the provision relating to the lawsuit with LaPine Technology Corporation (“LTC”) of the United States. Income before income taxes increased slightly, however, due to a significant decrease during the first quarter of the current fiscal year, as compared with the corresponding quarter of the previous fiscal year, in the foreign exchange losses incurred by Kyocera in connection with its foreign currency deposit with the financial institution which is issuing a letter of credit necessary for Kyocera to continue the lawsuit with LTC. Such deposit has been made to reduce the service fee charged by the financial institution on the letter of credit. In addition, net income increased as a result of the absence of net losses amounting to ¥2.3 billion as a cumulative effect under Statement of Financial Accounting Standards (SFAS) No. 142, “Goodwill and Other Intangible Assets.”

 

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During the first quarter, agreement was reached on May 21st to make Kinseki, Limited. (Kinseki) a wholly-owned subsidiary through stock swap in order to strengthen its existing businesses, as part of Kyocera’s core strategy initiative of “high-value-added diversification.” Kinseki is scheduled to become a wholly-owned subsidiary of the Company on August 1. In addition, agreement was reached on June 30 with IBM Corporation and IBM Japan Ltd. to transfer the SLCtm (Surface Laminar Circuitrytm: laminated high-density printed circuit board) business of IBM Japan Ltd.’s Yasu Site to Kyocera. With the transfer of this business, Kyocera will establish a new company, which will begin operations as a new subsidiary in September 2003.

 

  *   SLCtm (Surface Laminar Circuitrytm) is a laminated high-density printed circuit board developed by IBM Corporation of the United States, and Surface Laminar Circuitrytm is a trademark of IBM Corporation.

 

2.   Consolidated Operating Segments

 

     Three Months Ended
June 30,


   

Increase
(Decrease)

(%)


 
     2003

    2002

   
     (Yen in millions)        

Net Sales

   253,126     253,930     (0.3 )

Fine Ceramics Group

   56,664     58,856     (3.7 )

Electronic Device Group

   55,835     58,400     (4.4 )

Equipment Group

   122,650     124,961     (1.8 )

Others

   21,363     15,042     42.0  

Adjustments and eliminations

   (3,386 )   (3,329 )   —    

Operating Profit

   14,929     14,761     1.1  

Fine Ceramics Group

   4,681     3,717     25.9  

Electronic Device Group

   1,309     2,176     (39.8 )

Equipment Group

   7,350     8,341     (11.9 )

Others

   1,589     527     201.5  

 

1)   Fine Ceramics Group

Although sales of semiconductor parts declined, sales of fine ceramic parts such as parts for LCD fabrication equipment and sapphire substrates for projectors achieved a steady growth year-on-year. Applied ceramic products such as solar energy systems and cutting tools resulted in significant increase of sales and profit.

 

2)   Electronic Device Group

Kyocera recognized start-up costs associated with the launch of the micro-device business, and capacitor business including AVX Corporation, a U.S. subsidiary experienced a tough business situation in terms of sales and profit. However, both sales and profit of thin-film products and connectors grew.

 

3)   Equipment Group

Sales and profit of telecommunications equipment were down, due to a depressed mobile handset market overseas, and optical instruments were also stagnant. For information equipment, however, sales increased year-on-year, and improvement in product mix and continued cost reductions generated a considerable increase in operating profit.

 

4)   Others

Kyocera Chemical newly contributed to this segment during the quarter and Kyocera Communication Systems Co., Ltd. achieved a significant growth in sales and profit.

 

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3.   Geographic Segments

 

     Three Months Ended
June 30,


  

Increase
(Decrease)

(%)


 
     2003

   2002

  
     (Yen in millions)       

Net Sales

   253,126    253,930    (0.3 )

Japan

   98,854    90,513    9.2  

United States of America

   59,000    79,833    (26.1 )

Asia

   45,729    39,421    16.0  

Europe

   36,972    33,611    10.0  

Others

   12,571    10,552    19.1  

 

1)   Japan

Net sales increased year-on-year, due to increased sales of fine ceramic parts and telecommunications equipment.

 

2)   United States of America

Net sales declined year-on-year, mainly due to lower mobile handsets sales.

 

3)   Asia

Net sales increased year-on-year, due to expanded sales of telecommunications equipment, such as PHS- related products for China.

 

4)   Europe

Net sales increased year-on-year as a result of increased sales of information equipment.

 

4.   Cash Flows

Cash and cash equivalents at June 30, 2003 increased by ¥1.3 billion to ¥299.6 billion compared with March 31, 2003.

 

     Three Months Ended
June 30,


 
     2003

    2002

 
     (Yen in millions)  

Cash flows from operating activities

   6,919     50,181  

Cash flows from investing activities

   2,841     (25,769 )

Cash flows from financing activities

   (9,391 )   (14,269 )

Effect of exchange rate changes on cash and cash equivalents

   953     (10,265 )

Net increase (decrease) in cash and cash equivalents

   1,322     (122 )

Cash and cash equivalents at beginning of period

   298,310     280,899  

Cash and cash equivalents at end of period

   299,632     280,777  

 

1)   Cash Flows from Operating Activities

Net cash provided by operating activities for the three months ended June 30, 2003 decreased by ¥43.3 billion to ¥6.9 billion from the previous same period of ¥50.2 billion. This was due mainly to increases in inventories and payments for income taxes and a decrease in notes and accounts payable, although net income increased by ¥3.3 billion to ¥10.7 billion compared with the previous same period.

 

2)   Cash Flows from Investing Activities

Net cash provided by investing activities for the three months ended June 30, 2003 increased by ¥28.6 billion to ¥2.8 billion from net cash used in the previous same period of ¥25.8 billion. This was due mainly to a decrease in purchase of securities and an increase in proceeds from maturities of securities.

 

3)   Cash Flows from Financing Activities

Net cash used in financing activities for the three months ended June 30, 2003 decreased by ¥4.9 billion to ¥9.4 billion from the previous same period of ¥14.3 billion. This was due mainly to an increase in short-term debt.

 

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5.   Prospects for the Year Ending March 31, 2004

 

1)   Economic Situation and Business Environment

The prospects for economic conditions include a return to stability in the Asian economy as the SARS crisis settles down, continued sluggishness in the European economy, and a slow recovery in the U.S. economy. Because the Japanese economy is strongly affected by the U.S. economy, the future for Japan remains unclear.

 

The electronics industry expects a continued increase in demand for personal computers, as well as digital AV equipment like digital cameras and DVDs. Production of mobile handsets is expected to increase, due to growing demand for color LCDs and camera equipped models, but the direction of personal consumption remains unclear amid low expectations for a stable recovery in the global economy.

 

Given this business environment, Kyocera aims to improve its business performance by continuing to develop new markets and expand sales of new products, and by implementing further cost reductions. There is no revision of our initial forecast for the fiscal year ending March 31, 2004, and a detailed forecast of the previously announced is as follows.

 

2)   Consolidated Financial Forecast for the Year Ending March 31, 2004 (Announced April 25, 2003)

 

     Year Ending
March 31,
2004


   Percent change
from the
previous year (%)


     (Yen in
millions)
    

Net sales

   1,140,000    6.6

Profit from operations

   89,000    6.7

Income before income taxes

   92,000    21.0

Net income

   52,000    26.3

US$ average exchange rate (yen)

   115    —  

Euro average exchange rate (yen)

   121    —  

 

Note: Forward-Looking Statements

Certain of the statements made in this document are forward-looking statements (within the meaning of Section 21E of the U.S. Securities and Exchange Act of 1934), which are based on our current assumptions and beliefs in light of the information currently available to us. These forward-looking statements involve known and unknown risks, uncertainties and other factors. Such risks, uncertainties and other factors include, but are not limited to: general economic conditions in our markets, which are primarily Japan, North America, Europe and Asia, including in particular China; changes in exchange rates, particularly between the yen and the U.S. dollar and Euro, respectively, in which we make significant sales; our ability to launch innovative products and otherwise meet the advancing technical requirements of our customers, particularly in the highly competitive markets for ceramics, semiconductor parts and electronic devices; and the extent and pace of future growth or contraction in information technology-related markets around the world, including those for communications and personal computers. Such risks, uncertainties and other factors may cause our actual results, performance, achievements or financial position to be materially different from any future results, performance, achievements or financial position expressed or implied by these forward-looking statements. We undertake no obligation to publicly update any forward-looking statements included in this document.

 

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CONSOLIDATED BALANCE SHEETS

 

     Yen in millions

 
    

(Unaudited)

June 30, 2003


   March 31, 2003

   Increase
(Decrease)


 
     Amount

    %

   Amount

    %

  

Current assets :

                                  

Cash and cash equivalents

   ¥ 299,632          ¥ 298,310          ¥ 1,322  

Restricted cash

     58,321            56,368            1,953  

Short-term investments

     15,641            14,651            990  

Trade notes receivable

     39,104            35,446            3,658  

Trade accounts receivable

     167,350            179,750            (12,400 )

Short-term finance receivables

     60,365            31,254            29,111  

Less allowances for doubtful accounts and sales returns

     (7,452 )          (7,703 )          251  

Inventories

     194,135            183,156            10,979  

Deferred income taxes

     51,742            52,136            (394 )

Other current assets

     25,346            19,054            6,292  
    


 
  


 
  


Total current assets

     904,184     53.2      862,422     52.7      41,762  
    


 
  


 
  


Non-current assets :

                                  

Investments in and advances to affiliates and unconsolidated subsidiaries

     24,783            24,398            385  

Securities and other investments

     359,419            308,137            51,282  
    


 
  


 
  


Total investments and advances

     384,202     22.6      332,535     20.3      51,667  

Long-term finance receivables

     99,269     5.8      125,728     7.7      (26,459 )

Property, plant and equipment, at cost :

                                  

Land

     54,069            53,973            96  

Buildings

     203,423            203,387            36  

Machinery and equipment

     590,459            587,076            3,383  

Construction in progress

     7,095            5,483            1,612  

Less accumulated depreciation

     (604,912 )          (600,414 )          (4,498 )
    


 
  


 
  


       250,134     14.7      249,505     15.3      629  

Goodwill

     25,805     1.5      25,703     1.6      102  

Intangible assets

     13,792     0.8      15,068     0.9      (1,276 )

Other assets

     22,634     1.4      24,053     1.5      (1,419 )
    


 
  


 
  


Total non-current assets

     795,836     46.8      772,592     47.3      23,244  
    


 
  


 
  


     ¥ 1,700,020     100.0    ¥ 1,635,014     100.0    ¥ 65,006  
    


 
  


 
  


Note  1:   Restricted cash represents the amount of time deposit to a financial institution in order to reduce the cost for the issuance of letter of credit in connection with a legal proceeding.

 

Note  2:   Effective April 1, 2002, Kyocera adopted SFAS No.142, “Goodwill and Other Intangible Assets.” According to this standard, the intangible assets formerly included in other assets is separately disclosed.

 

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Table of Contents
     Yen in millions

 
    

(Unaudited)

June 30, 2003


   March 31, 2003

   Increase
(Decrease)


 
     Amount

    %

   Amount

    %

  

Current liabilities :

                                  

Short-term borrowings

   ¥ 111,600          ¥ 107,886          ¥ 3,714  

Current portion of long-term debt

     42,513            30,198            12,315  

Trade notes and accounts payable

     93,588            98,105            (4,517 )

Other notes and accounts payable

     32,635            28,428            4,207  

Accrued payroll and bonus

     41,614            33,059            8,555  

Accrued income taxes

     9,726            28,060            (18,334 )

Accrued litigation expenses

     42,112            41,862            250  

Other accrued expenses

     22,943            23,387            (444 )

Other current liabilities

     15,518            14,589            929  
    


 
  


 
  


Total current liabilities

     412,249     24.2      405,574     24.8      6,675  

Non-current liabilities :

                                  

Long-term debt

     40,451            60,736            (20,285 )

Accrued pension and severance costs

     74,909            74,906            3  

Deferred income taxes

     51,266            22,879            28,387  

Other non-current liabilities

     4,644            5,859            (1,215 )
    


 
  


 
  


Total non-current liabilities

     171,270     10.1      164,380     10.0      6,890  
    


 
  


 
  


Total liabilities

     583,519     34.3      569,954     34.8      13,565  
    


 
  


 
  


Minority interests in subsidiaries

     62,579     3.7      61,560     3.8      1,019  

Stockholders’ equity :

                                  

Common stock

     115,703            115,703            —    

Additional paid-in capital

     167,675            167,675            —    

Retained earnings

     833,531            828,350            5,181  

Accumulated other comprehensive income

     (10,940 )          (56,194 )          45,254  

Treasury stock, at cost

     (52,047 )          (52,034 )          (13 )
    


 
  


 
  


Total stockholders’ equity

     1,053,922     62.0      1,003,500     61.4      50,422  
    


 
  


 
  


     ¥ 1,700,020     100.0    ¥ 1,635,014     100.0    ¥ 65,006  
    


 
  


 
  


 

Note 3: Accumulated other comprehensive income is as follows:

 

     Yen in millions

 
     June 30,
2003


     March 31,
2003


 

Net unrealized gains (losses) on securities

   ¥ 11,117      ¥ (29,955 )

Net unrealized losses on derivative financial instruments

   ¥ (268 )    ¥ (331 )

Minimum pension liability adjustments

   ¥ (10,931 )    ¥ (10,931 )

Foreign currency translation adjustments

   ¥ (10,858 )    ¥ (14,977 )

 

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Table of Contents

CONSOLIDATED STATEMENTS OF INCOME (Unaudited)

 

     Yen in millions and shares in thousands, except per share amounts

 
     Three months ended June 30,

    Increase (Decrease)

 
     2003

    2002

   
     Amount

    %

    Amount

    %

    Amount

    %

 

Net sales

   ¥ 253,126     100.0     ¥ 253,930     100.0     ¥ (804 )   (0.3 )

Cost of sales

     189,539     74.9       185,246     73.0       4,293     2.3  
    


 

 


 

 


 

Gross profit

     63,587     25.1       68,684     27.0       (5,097 )   (7.4 )

Selling, general and administrative expenses

     50,789     20.0       46,442     18.2       4,347     9.4  
    


 

 


 

 


 

Profit from operations

     12,798     5.1       22,242     8.8       (9,444 )   (42.5 )

Interest and dividend income

     1,635     0.6       1,688     0.6       (53 )   (3.1 )

Interest expense

     (361 )   (0.1 )     (440 )   (0.2 )     79     —    

Foreign currency transaction gains (losses), net

     1,253     0.5       (7,270 )   (2.9 )     8,523     —    

Equity in earnings of affiliates and unconsolidated subsidiaries

     733     0.3       15     0.0       718     —    
Other, net      384     0.1       140     0.1       244     174.3  
    


 

 


 

 


 

Total other income (expenses)

     3,644     1.4       (5,867 )   (2.4 )     9,511     —    
    


 

 


 

 


 

Income before income taxes, minority interests and cumulative effect of change in accounting principle

     16,442     6.5       16,375     6.4       67     0.4  

Income taxes

     6,294     2.5       6,658     2.6       (364 )   (5.5 )
    


 

 


 

 


 

Income before minority interests and cumulative effect of change in accounting principle

     10,148     4.0       9,717     3.8       431     4.4  

Minority interests

     582     0.2       (70 )   (0.0 )     652     —    
    


 

 


 

 


 

Income before cumulative effect of change in accounting principle

     10,730     4.2       9,647     3.8       1,083     11.2  

Cumulative effect of change in accounting principle

     —       —         (2,256 )   (0.9 )     2,256     —    
    


 

 


 

 


 

Net income

   ¥ 10,730     4.2     ¥ 7,391     2.9     ¥ 3,339     45.2  
    


 

 


 

 


 

Earnings per share :

                                          

  Income before cumulative effect of change in accounting principle :

                                          

Basic

   ¥ 58.01           ¥ 51.03                      

Diluted

   ¥ 58.01           ¥ 51.00                      

  Net income :

                                          

Basic

   ¥ 58.01           ¥ 39.10                      

Diluted

   ¥ 58.01           ¥ 39.07                      

Weighted average number of shares of common stock outstanding :

                                          

Basic

     184,963             189,042                      

Diluted

     184,963             189,165                      

 

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Notes:

1.   Kyocera applies SFAS No.130, “Financial Reporting of Comprehensive Income.”

Based on this standard, comprehensive income for the three months ended June 30, 2003 and 2002 was an increase of 55,984 million yen and 4,830 million yen, respectively.

2.   Earnings per share amounts were computed based on SFAS No.128, “Earnings per Share.”

Under SFAS No.128, basic earnings per share was computed based on the average number of shares of common stock outstanding during each period and diluted earnings per share assumed 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.

3.   Effective April 1, 2002, Kyocera adopted SFAS No.142, “Goodwill and Other Intangible Assets.”

Upon the adoption of this standard, Kyocera recognized cumulative effects of this change in accounting principle, net of tax amounted to 2,256 million yen for the three months ended June 30, 2002.

 

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Table of Contents

CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)

     Yen in millions

 
     Three months ended
June 30,


 
     2003

    2002

 

Cash flows from operating activities:

                

Net income

   ¥ 10,730     ¥ 7,391  

Adjustments to reconcile net income to net cash provided by operating activities :

                

Depreciation and amortization

     16,086       17,351  

Cumulative effect of change in accounting principle

     —         2,256  

Foreign currency adjustments

     (1,230 )     7,372  

Decrease in receivables

     6,900       5,571  

(Increase) decrease in inventories

     (9,221 )     8,496  

(Increase) decrease in other current assets

     (2,495 )     1,726  

Decrease in notes and accounts payable

     (7,141 )     (1,707 )

Other, net

     (6,710 )     1,725  
    


 


Net cash provided by operating activities

     6,919       50,181  
    


 


Cash flows from investing activities :

                

Payments for purchases of securities

     (13,408 )     (22,281 )

Payments for purchases of investments and advances

     (86 )     (109 )

Sales and maturities of securities

     30,240       7,751  

Payments for purchases of property, plant and equipment, and intangible assets

     (12,148 )     (11,520 )

Proceeds from sales of property, plant and equipment, and intangible assets

     569       424  

Acquisitions of businesses, net of cash acquired

     45       —    

Restricted cash

     (1,994 )     (511 )

Other, net

     (377 )     477  
    


 


Net cash provided by (used in) investing activities

     2,841       (25,769 )
    


 


Cash flows from financing activities :

                

Increase in short-term debt

     3,499       1,029  

Proceeds from issuance of long-term debt

     463       396  

Payments of long-term debt

     (8,506 )     (10,238 )

Dividends paid

     (5,363 )     (5,564 )

Other, net

     516       108  
    


 


Net cash used in financing activities

     (9,391 )     (14,269 )
    


 


Effect of exchange rate changes on cash and cash equivalents

     953       (10,265 )
    


 


Net increase (decrease) in cash and cash equivalents

     1,322       (122 )

Cash and cash equivalents at beginning of period

     298,310       280,899  
    


 


Cash and cash equivalents at end of period

   ¥ 299,632     ¥ 280,777  
    


 


 

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Table of Contents

SEGMENT INFORMATION (Unaudited)

 

1.   Operating segments :
     Yen in millions

 
     Three months ended June 30,

             
     2003

    2002

    Increase (Decrease)

 
     Amount

    Amount

    Amount

    %

 

Net sales :

                              

Fine Ceramics Group

   ¥ 56,664     ¥ 58,856     ¥ (2,192 )   (3.7 )

Electronic Device Group

     55,835       58,400       (2,565 )   (4.4 )

Equipment Group

     122,650       124,961       (2,311 )   (1.8 )

Others

     21,363       15,042       6,321     42.0  

Adjustments and eliminations

     (3,386 )     (3,329 )     (57 )   —    
    


 


 


 

     ¥ 253,126     ¥ 253,930     ¥ (804 )   (0.3 )
    


 


 


 

Operating profit :

                              

Fine Ceramics Group

   ¥ 4,681     ¥ 3,717     ¥ 964     25.9  

Electronic Device Group

     1,309       2,176       (867 )   (39.8 )

Equipment Group

     7,350       8,341       (991 )   (11.9 )

Others

     1,589       527       1,062     201.5  
    


 


 


 

       14,929       14,761       168     1.1  

Corporate

     720       1,483       (763 )   (51.4 )

Equity in earnings of affiliates and unconsolidated subsidiaries

     733       15       718     —    

Adjustments and eliminations

     60       116       (56 )   (48.3 )
    


 


 


 

Income before income taxes

   ¥ 16,442     ¥ 16,375     ¥ 67     0.4  
    


 


 


 

Depreciation and amortization :

                              

Fine Ceramics Group

   ¥ 3,744     ¥ 4,609     ¥ (865 )   (18.8 )

Electronic Device Group

     5,575       6,286       (711 )   (11.3 )

Equipment Group

     4,924       4,879       45     0.9  

Others

     1,253       959       294     30.7  

Corporate

     590       618       (28 )   (4.5 )
    


 


 


 

     ¥ 16,086     ¥ 17,351     ¥ (1,265 )   (7.3 )
    


 


 


 

Capital expenditures :

                              

Fine Ceramics Group

   ¥ 2,808     ¥ 1,904     ¥ 904     47.5  

Electronic Device Group

     5,504       2,594       2,910     112.2  

Equipment Group

     4,891       3,602       1,289     35.8  

Others

     278       870       (592 )   (68.0 )

Corporate

     666       504       162     32.1  
    


 


 


 

     ¥ 14,147     ¥ 9,474     ¥ 4,673     49.3  
    


 


 


 

 

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Table of Contents
2.   Geographic segments (Sales and Operating profits by geographic area) :

 

     Yen in millions

 
     Three months ended June 30,

       
     2003

    2002

    Increase (Decrease)

 
     Amount

    Amount

    Amount

    %

 

Net sales:

                              

Japan

   ¥ 114,719     ¥ 102,913     ¥ 11,806     11.5  

Intra-group sales and transfer between geographic areas

     62,000       60,862       1,138     1.9  
    


 


 


 

       176,719       163,775       12,944     7.9  
    


 


 


 

United States of America

     67,020       85,877       (18,857 )   (22.0 )

Intra-group sales and transfer between geographic areas

     6,377       4,916       1,461     29.7  
    


 


 


 

       73,397       90,793       (17,396 )   (19.2 )
    


 


 


 

Asia

     29,252       25,875       3,377     13.1  

Intra-group sales and transfer between geographic areas

     23,068       19,887       3,181     16.0  
    


 


 


 

       52,320       45,762       6,558     14.3  
    


 


 


 

Europe

     37,621       35,633       1,988     5.6  

Intra-group sales and transfer between geographic areas

     7,729       7,492       237     3.2  
    


 


 


 

       45,350       43,125       2,225     5.2  
    


 


 


 

Others

     4,514       3,631       883     24.3  

Intra-group sales and transfer between geographic areas

     1,593       2,251       (658 )   (29.2 )
    


 


 


 

       6,107       5,882       225     3.8  
    


 


 


 

Adjustments and eliminations

     (100,767 )     (95,407 )     (5,360 )   —    
    


 


 


 

     ¥ 253,126     ¥ 253,930     ¥ (804 )   (0.3 )
    


 


 


 

Operating Profits :                               

Japan

   ¥ 19,165     ¥ 9,374     ¥ 9,791     104.4  

United States of America

     (1,797 )     3,223       (5,020 )   —    

Asia

     917       2,738       (1,821 )   (66.5 )

Europe

     (1,999 )     (2,263 )     264     —    

Others

     176       379       (203 )   (53.6 )
    


 


 


 

       16,462       13,451       3,011     22.4  

Adjustments and eliminations

     (1,473 )     1,426       (2,899 )   —    
    


 


 


 

       14,989       14,877       112     0.8  

Corporate

     720       1,483       (763 )   (51.4 )

Equity in earnings of affiliates and unconsolidated subsidiaries

     733       15       718     —    
    


 


 


 

Income before income taxes

   ¥ 16,442     ¥ 16,375     ¥ 67     0.4  
    


 


 


 

 

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Table of Contents
3.   Geographic segments (Sales by region) :

 

     Yen in millions

 
     Three months ended June 30,

      
     2003

   2002

   Increase (Decrease)

 
     Amount

    %

   Amount

    %

   Amount

    %

 

Japan

   ¥ 98,854     39.1    ¥ 90,513     35.7    ¥ 8,341     9.2  

United States of America

     59,000     23.3      79,833     31.4      (20,833 )   (26.1 )

Asia

     45,729     18.0      39,421     15.5      6,308     16.0  

Europe

     36,972     14.6      33,611     13.2      3,361     10.0  

Others

     12,571     5.0      10,552     4.2      2,019     19.1  
    


 
  


 
  


 

Net sales

   ¥ 253,126     100.0    ¥ 253,930     100.0    ¥ (804 )   (0.3 )
    


 
  


 
  


 

Sales outside Japan

   ¥ 154,272          ¥ 163,417          ¥ (9,145 )   (5.6 )

Sales outside Japan to net sales

     60.9 %          64.3 %                   

 

15