FORM 6-K
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
Report of Foreign Private Issuer
Pursuant to Rule 13a-16 or 15d-16 of
the Securities Exchange Act of 1934
For the month of October 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-
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 Finance Division |
Date: October 28, 2003
Information furnished on this form:
Exhibit Number |
||
1. | Consolidated Financial Results for the Six Months Ended September 30, 2003 | |
2. | Notice relating to Restructuring of Crystal Components Related Businesses of Kyocera Group |
October 28, 2003
KYOCERA CORPORATION
Consolidated Financial Highlights
Results for the Six Months Ended September 30, 2003
(Yen in millions, except per share amounts, exchange rates and number of employees ) |
||||||||
Six Months Ended September 30, |
Increase or Decrease (%) |
|||||||
2003 |
2002 |
|||||||
Net sales |
518,378 | 517,003 | 0.3 | |||||
Profit from operations |
22,554 | 36,947 | (39.0 | ) | ||||
Income before income taxes |
25,127 | 33,593 | (25.2 | ) | ||||
Net income |
15,754 | 17,127 | (8.0 | ) | ||||
Average exchange rates : |
||||||||
US$ |
118 | 123 | | |||||
Euro |
133 | 117 | | |||||
Earnings per share : |
||||||||
Net income |
||||||||
Basic |
84.79 | 91.25 | (7.1 | ) | ||||
Diluted |
84.79 | 91.21 | (7.0 | ) | ||||
Capital expenditures |
27,458 | 19,191 | 43.1 | |||||
Depreciation |
28,933 | 31,328 | (7.6 | ) | ||||
R&D expenses |
23,804 | 23,554 | 1.1 | |||||
Total assets |
1,771,550 | 1,639,928 | | |||||
Stockholders equity |
1,092,402 | 1,013,188 | | |||||
Sales of products manufactured outside Japan to net sales (%) |
33.1 | 35.0 | | |||||
Number of employees at the end of periods |
54,740 | 47,666 | |
- 1 -
KYOCERA CORPORATION
The consolidated financial statements are in conformity with accounting principles generally accepted in the United States of America.
Date of the board of directors meeting for the interim consolidated results : October 28, 2003
1. Results for the six months ended September 30, 2003:
(1) Consolidated results of operations :
Japanese yen | |||||||||||
Six months ended September 30, |
Year ended March 31, | ||||||||||
2003 |
2002 |
2003 | |||||||||
Net sales |
¥ | 518,378 million | ¥ | 517,003 million | ¥ | 1,069,770 million | |||||
% change from the previous period |
0.3 | % | (0.6 | )% | |||||||
Profit from operations |
22,554 million | 36,947 million | 83,388 million | ||||||||
% change from the previous period |
(39.0 | )% | 8.2 | % | |||||||
Income before income taxes |
25,127 million | 33,593 million | 76,037 million | ||||||||
% change from the previous period |
(25.2 | )% | (5.1 | )% | |||||||
Net income |
15,754 million | 17,127 million | 41,165 million | ||||||||
% change from the previous period |
(8.0 | )% | (10.3 | )% | |||||||
Earnings per share : |
|||||||||||
Basic |
¥ | 84.79 | ¥ | 91.25 | ¥ | 220.91 | |||||
Diluted |
84.79 | 91.21 | 220.86 |
Notes : |
||
1. Equity in earnings of affiliates and unconsolidated subsidiaries : |
||
Six months ended September 30, 2003 |
¥1,729 million | |
Six months ended September 30, 2002 |
¥1,175 million | |
Year ended March 31, 2003 |
¥3,092 million | |
2. Average number of shares outstanding during the period : |
||
Six months ended September 30, 2003 |
185,802,535 shares | |
Six months ended September 30, 2002 |
187,693,727 shares | |
Year ended March 31, 2003 |
186,338,368 shares | |
3. Change in accounting policies : |
None |
(2) Consolidated financial condition :
Japanese yen |
||||||||||||
September 30, |
March 31, |
|||||||||||
2003 |
2002 |
2003 |
||||||||||
Total assets |
¥ | 1,771,550 million | ¥ | 1,639,928 million | ¥ | 1,635,014 million | ||||||
Stockholders equity |
1,092,402 million | 1,013,188 million | 1,003,500 million | |||||||||
Stockholders equity to total assets |
61.7 | % | 61.8 | % | 61.4 | % | ||||||
Stockholders equity per share |
¥ | 5,826.70 | ¥ | 5,475.85 | ¥ | 5,425.37 |
Notes : Total number of shares outstanding as of : |
||
September 30, 2003 |
187,482,238 shares | |
September 30, 2002 |
185,028,442 shares | |
March 31, 2003 |
184,964,360 shares |
- 2 -
(3) Consolidated cash flows :
Japanese yen | |||||||||
Six months ended September 30, |
Year ended March 31, | ||||||||
2003 |
2002 |
2003 | |||||||
Cash flows from operating activities |
¥ | 28,510 million | ¥ | 93,542 million | ¥ | 160,754 million | |||
Cash flows from investing activities |
(5,163) million | (24,797) million | (58,512) million | ||||||
Cash flows from financing activities |
(16,112) million | (63,228) million | (74,662) million | ||||||
Cash and cash equivalents at end of period |
299,160 million | 278,098 million | 298,310 million |
(4) Scope of consolidation and application of the equity method :
Number of consolidated subsidiaries : 158
Number of subsidiaries accounted for by the equity method : 2
Number of affiliates accounted for by the equity method : 15
(5) Changes in scope of consolidation and application of the equity method :
Consolidation |
Equity method | |||
Increase |
18 | 0 | ||
Decrease |
2 | 2 |
2. Forecast for the year ending March 31, 2004 :
Japanese yen | |||
Year ending March 31, 2004 | |||
Net sales |
¥ | 1,140,000 million | |
Income before income taxes |
79,000 million | ||
Net income |
50,000 million |
Note:
Forecast of annual earnings per share : ¥269.10
Earnings per share is computed based on Statement of Financial Accounting Standards (SFAS) No.128.
Forecast of annual earnings per share is computed based on the diluted average number of shares outstanding during the six months ended September 30, 2003. |
With regard to forecasts set forth above, please refer to the accompanying Forward Looking Statements on page 16.
- 3 -
KYOCERA GROUP
Kyocera group consists of Kyocera Corporation, 160 subsidiaries and 15 affiliates.
- 4 -
Management Policies
1. Management Goal and Strategies
| Kyocera Corporation and its subsidiaries (Kyocera) strive to be a creative company that continues to grow in 21st century. To achieve this goal, Kyocera promotes high-value-added diversification in three high growth potential areas telecommunications and information processing, environmental protection, and quality of life in accordance with the following criteria and management system. |
1) Criteria
Valuable business is defined as a business with pre-tax profit ratio of 15% or more. Whether or not to remain in a field is based on a judgment of the existence of an evident need in the relevant markets and the possibility of serving that market need from the current or future attainable technologies.
2) Management System
Our unique management control system allows us to stay abreast of individual businesses with an accurate picture of each, make optimal decisions in a timely manner, and maximize synergies among businesses.
| The single most important management resource for successful business diversification is technological prowess. Based on this conviction, Kyocera strives to expand (diversify) applications through thorough advancement and specialization of its technical expertise, thereby promptly responding to the variety of market needs brought about by rapid changes in society. We believe this diversification strategy will help us sustainable and stable growth even under difficult business environment. |
| We make full use of external management resources to enhance Group resources such as technological strength, which should help us to lead the competition in both the components and equipment businesses. Through the integration of existing Group resources and external management resources, Kyocera intends to develop new technologies, products and markets before our competitors do, to make Kyocera a global leader in each of the involved markets. |
2. Specific Policies
<Efficient Resource Management>
| Kyocera will demarcate areas for either expansion or reorganization and aggressively invest management resources in high value businesses. |
| Authorization of decision-making will be delegated to each Corporate and Individual Business Division to act as an independent company, in order to speed up management decision-making processes and realize growth in all business segments. |
| A prime emphasis is placed on cash flows, and in particular, boosting returns on invested capital, implementing thorough inventory control and shortening lead-times. |
<Emphasizing Consolidated Group Results>
| Kyocera will increase its profitability of each operating segment on a consolidated basis by strengthening ties between each Corporate Business Division and Business Division and Kyocera Group subsidiaries and affiliates to maximize synergies. |
| Kyocera will employ a global strategy in each business and optimize R&D, production and sales structures. |
<Focusing on Stockholder Value>
| In order to increase stockholder value (market capitalization), Kyocera seeks to generate a higher return on investment to maximize future profits and cash flows. |
| A stock option plan will be extended to senior managers within Kyocera to further increase value by ensuring their interests in agreement with stockholders and investors. |
- 5 -
3. Basic Policy on Profit Distribution
| Since its public offering, Kyocera Corporation (the Company) has endeavored to increase dividends per share in line with improvements in performance. The Company has also boosted share dividends by actively applying free-share distributions and stock splits. In the coming years, the Company will work to further improve earnings per share and cash flow, and on the basis of the results, will share its success in the form of dividends in accordance with holistic judgments. |
| Kyoceras goal of constantly enhancing profitability will ensure greater returns for stockholders. In order to be a creative company that continues to grow in the 21st century, Kyocera will strive at the same time to be a market leader in the three strategic areas of telecommunications and information processing, environmental protection and quality of life. To support its commitment to invest in its businesses, the Company will retain a high level of internal reserves. |
4. Policy Encouraging Individual Share Ownership
| In February 1997, to make share transactions easier for individuals, the Company revised the number of shares in a minimum trading unit, reducing it from 1,000 to 100 shares. These efforts have proven highly rewarding, as the number of stockholders in the Company as of the end of September 2003 jumped nearly five-fold, from the approximately 18,500 recorded at the time of implementation to 94,788. The Company has not yet formulated any other plans to reduce the size of trading units. |
5. Corporate Governance Guidelines and Policy Implementation
<Basic Guidelines on Corporate Governance>
| Kyocera believes in the importance of a corporate governance system to maximize long-term and sustained stockholder value and profits for all of Kyoceras stakeholders. |
| The principles and values inherent in this corporate governance system constitute an ethic shared by all Kyocera managers and employees. At the core of Kyocera is the Kyocera Corporate Philosophy, and all open and fair operating activities since the Companys founding have flowed out of the utilization of this universally accepted philosophy. |
| Kyocera has implemented a structure that promotes management transparency and accountability through the practice of compliance management and the advancement of the corporate governance structure. |
<Approaches and Measures to Enhance Corporate Governance>
[Promoting the Kyocera Corporate Philosophy]
| The Kyocera Management Research Institute was established in March 2002 to educate managers and employees to be skilled managers who exercise sound principles, thus asserting the common goals of the Kyocera Corporate Philosophy, which counsels on right actions as a human being throughout Kyocera. The Company has continued to reinforce its corporate ethics by training managers and employees in its corporate philosophy since November 2002 in order to develop future managers. |
[Practicing Compliance Management]
| In June 2000, the Company formulated the Kyocera Employee Action Guidelines concerning daily operations, as one step to ensuring compliance-based management, thereby advocating conformity to these guidelines in all managers and employees. |
| The Company established a Risk Management Department in September 2000 to ensure a deliberate, systematic and sustained approach to compliance management. |
| The Company set up a counseling room in April 2003 where employees can consult on violations or alleged violations of the guidelines. |
- 6 -
[Advances in the Corporate Governance System]
| As a company listed on the New York Stock Exchange, Kyocera has been considering the improvement of the internal control system in accordance with the Sarbanes-Oxley Act, passed in July 2002. Specifically, Kyocera has established the Kyocera Disclosure Committee as a complement to the new system to ensure fair disclosure of information, enhancing management transparency and accountability. |
| In June 2003, the Company introduced an executive officer system, designed to keep strategic decision-making and supervision separate from the management of day-to-day operations, in the hope of establishing a corporate governance system commensurate with a global enterprise and a structure that prompts rapid decision-making in response to changes in the business environment, while further developing management with a view to the future. |
[Initiatives for Corporate Governance]
| The above-mentioned initiatives for reinforcement of corporate governance are illustrated below. |
- 7 -
Business Results and Financial Condition
1. Business Results for the Six Months Ended September 30, 2003
1) Economic Situation and Business Environment
| During the six months ended September 30, 2003 (this first half), the U.S. economy fell short of a full-fledged recovery, despite signs of a turnaround in personal consumption and private sector capital expenditure. The European economy remained generally weak. The Asian economy suffered a temporary decline in production at the beginning of this first half due to Severe Acute Respiratory Syndrome (SARS) in China, but returned to a recovery track after SARS was brought under control. In Japan, the situation was mixed: private capital investment rose, but growth in personal consumption stayed at a low level. The revitalization of the stock market hinted at a bright future for the domestic economy, but the rapid appreciation of the yen since September has aroused concern over its future course. |
| In the electronics industry, the digital home appliance market and notebook PC and other computer equipment market expanded. Demand was sluggish in the mobile phone market due to SARS which caused excess inventory in China at the start of this first half, but the greater popularity of mobile handsets with color LCDs and built-in cameras stimulated demand for new and replacement sets, bringing the market back on track to recovery after the summer. |
2) Consolidated Results for the Six Months Ended September 30, 2003
(Yen in millions, except per share amounts and exchange rates) |
|||||||
Six Months Ended September 30, |
% Change |
||||||
2003 |
2002 |
||||||
Net sales |
518,378 | 517,003 | 0.3 | ||||
Profit from operations |
22,554 | 36,947 | (39.0 | ) | |||
Income before income taxes |
25,127 | 33,593 | (25.2 | ) | |||
Net income |
15,754 | 17,127 | (8.0 | ) | |||
Diluted earnings per share |
84.79 | 91.21 | (7.0 | ) | |||
Average US$ exchange rate |
118 | 123 | | ||||
Average Euro exchange rate |
133 | 117 | |
| Electronic Device Group and Others achieved sales growth, however sales of Equipment Group declined. As a result, net sales of this first half increased slightly compared to the previous first half. |
| Two-month sales of Kinseki, Ltd. (Kinseki) and one-month sales of Kyocera SLC Technologies Corp. (Kyocera SLC Technologies) were newly added, respectively, as well as contributions by Kyocera Chemical Corp. (Kyocera Chemical) to the consolidated results throughout the six months under review. |
| AVX Corporation (AVX), a U.S. subsidiary, wrote down 88 million U.S. dollars (approximately 10.4 billion yen) on its current tantalum material and future inventory of tantalum material based on long-term contracts. Due to this one-time expense and lower profits from sales decline in the Equipment Group, profit from operations, income before income taxes and net income all decreased from the previous first half. |
| The average exchange rate during this first half was 118 yen to the U.S. dollar and 133 yen to the Euro. This represented an appreciation of the yen against the U.S. dollar but a depreciation against the Euro compared to the previous first half. In terms of sales, the effects of the yens appreciation against the dollar outweighed the positive impact of the weak yen against the Euro. Accordingly, net sales after translation into the yen had a negative impact of approximately 7.5 billion yen on a year-on-year basis. Conversely, the positive effects of the weak yen against the Euro compensated for the strong yen against the dollar, and as a result, income before income taxes had a positive impact of approximately 3.3 billion yen. |
- 8 -
3) Items to be Reported
| The following strategic decisions were made during this first half under review in order to tap into the potential of the crystal components and organic circuit board businesses. |
(1) | Effective August 1, 2003, Kinseki was made a wholly-owned subsidiary of the Company through a stock swap. To integrate Kyoceras management resources efficiently, it was decided to transfer the Companys crystal components development and production to Kinseki and to integrate Kinsekis salesforce with the Companys Electronic Device Group in April 2004. |
(2) | Pursuant to the agreement reached with IBM Corporation and IBM Japan Ltd. to take over the surface laminar circuitry (SLC) business of IBM Japan Ltd., located at its Yasu site, Kyocera established a new subsidiary, Kyocera SLC Technologies, which started operations on September 1, 2003. |
| With respect to a dispute between the Company, LaPine Technology Corporation (LTC) and Prudential-Bache Trade Corporation (PBTC) (presently renamed Prudential-Bache Trade Services, Inc.) concerning the validity of an agreement in connection with the reorganization of LTC and alleged breach of such agreement by the Company, on July 23, 2002, the Ninth Circuit Court of Appeals issued a decision ordering the Company to pay approximately 453 million U.S. dollars, including interest and attorneys fees. Upon such decision, the Company filed a Petition for Rehearing and Rehearing En Banc, and the Ninth Circuit Court of Appeals entered an order in December 2002 granting the Companys petition for en banc review. A decision was made by an en banc panel with respect to the rehearing of this case on August 29. In this decision, the Court of Appeals denied judicial examination of the arbitration award rendered pursuant to a contract between private parties and thereby vacated its decision in 1997 affirming judicial examination of such award. The Court then affirmed the arbitration award rendered in 1994 and the decision of the District Court affirming such arbitration award, without opining on the merits. The Company is investigating the possibility of appealing the decision to the Federal Supreme Court. |
- 9 -
4) Operating Segments
(Yen in millions) |
|||||||||
Six Months Ended September 30, |
% Change |
||||||||
2003 |
2002 |
||||||||
Net sales |
518,378 | 517,003 | 0.3 | ||||||
Fine Ceramics Group |
119,399 | 119,077 | 0.3 | ||||||
Electronic Device Group |
119,787 | 115,491 | 3.7 | ||||||
Equipment Group |
241,372 | 250,862 | (3.8 | ) | |||||
Others |
46,181 | 37,785 | 22.2 | ||||||
Adjustments and eliminations |
(8,361 | ) | (6,212 | ) | | ||||
Operating profit |
20,009 | 34,689 | (42.3 | ) | |||||
Fine Ceramics Group |
11,322 | 8,471 | 33.7 | ||||||
Electronic Device Group |
(6,392 | ) | 5,974 | | |||||
Equipment Group |
10,274 | 17,028 | (39.7 | ) | |||||
Others |
4,805 | 3,216 | 49.4 |
<Fine Ceramics Group>
| Sales of semiconductor parts fell, but demand was brisk for fine ceramic parts, including parts for LCD fabrication equipment and sapphire substrates for LCD projectors. Sales of consumer-related products, such as solar energy products and cutting tools, also increased strongly. |
| Operating profit for this segment improved due to improved productivity through cost reduction efforts, as well as increased sales of fine ceramic parts and consumer-related products. |
<Electronic Device Group>
| Prices for ceramic capacitors and timing devices continued to drop, but components demand for mobile handsets recovered after SARS was brought under control. Demand for connectors and thin-film products performed briskly, and Kinseki started to contribute to consolidated results since August 2003. |
| AVX posted a one-time expense associated with the write-down of its current and future inventories of tantalum material based on long-term contracts. As a result, operating profit for this segment declined compared with the previous first half. Including AVX, Kyocera plans to design a new organizational setup to maximize the Group synergies in the development, production and sales of passive components. |
<Equipment Group>
| Although sales of telecommunications equipment and optical instruments declined, information equipment sales advanced due to brisk sales of mid- and high-speed digital, computer-networkable, multi-functional peripherals and the high market reliability of the products. |
| Operating profit of telecommunications equipment and optical instruments decreased on a year-on-year basis. Information equipment, however, achieved a healthy growth in operating profit, due to sales increase and the positive impact of change in product mix such as increased portion of high- value-added products. |
<Others>
| With improved sales and profitability for Kyocera Communication Systems Co., Ltd. (KCCS) and the contribution of Kyocera Chemical to consolidated results since the start of this fiscal year, sales and profits grew for this segment. |
- 10 -
5) Orders and Production
(Yen in millions) |
|||||||||
Six Months Ended September 30, |
% Change |
||||||||
2003 |
2002 |
||||||||
Orders |
582,217 | 546,167 | 6.6 | ||||||
Fine Ceramics Group |
128,674 | 117,830 | 9.2 | ||||||
Electronic Device Group |
127,146 | 119,615 | 6.3 | ||||||
Equipment Group |
284,659 | 271,649 | 4.8 | ||||||
Others |
49,340 | 42,322 | 16.6 | ||||||
Adjustments and eliminations |
(7,602 | ) | (5,249 | ) | | ||||
Production |
530,178 | 513,328 | 3.3 | ||||||
Fine Ceramics Group |
114,178 | 110,051 | 3.8 | ||||||
Electronic Device Group |
132,954 | 130,032 | 2.2 | ||||||
Equipment Group |
254,400 | 254,522 | (0.0 | ) | |||||
Others |
28,646 | 18,723 | 53.0 |
| See 4) Operating Segments for descriptions of orders and production by operating segments. |
6) Geographic Segments
(Yen in millions) |
|||||||
Six Months Ended September 30, |
% Change |
||||||
2003 |
2002 |
||||||
Net Sales |
518,378 | 517,003 | 0.3 | ||||
Japan |
211,276 | 194,708 | 8.5 | ||||
United States |
114,335 | 150,977 | (24.3 | ) | |||
Asia excluding Japan |
90,122 | 80,685 | 11.7 | ||||
Europe |
73,472 | 68,161 | 7.8 | ||||
Others |
29,173 | 22,472 | 29.8 |
<Japan>
The fine ceramics parts and telecommunications equipment businesses achieved sales growth.
<United States>
Telecommunications equipment sales mainly declined.
<Asia excluding Japan>
Sales of telecommunications equipment, electronic devices and semiconductor parts grew.
<Europe>
Information equipment and applied ceramic products such as solar generating systems achieved growth in sales.
- 11 -
2. Financial Condition
Consolidated Cash Flow
Cash and cash equivalents at September 30, 2003 increased by ¥850 million to ¥299,160 million compared with at March 31, 2003.
(Yen in millions) |
|||||||||
Six Months Ended September 30, |
Changes in Amount |
||||||||
2003 |
2002 |
||||||||
Cash flow from operating activities |
28,510 | 93,542 | (65,032 | ) | |||||
Cash flow from investment activities |
(5,163 | ) | (24,797 | ) | 19,634 | ||||
Cash flow from financing activities |
(16,112 | ) | (63,228 | ) | 47,116 | ||||
Effect of exchange rate changes on cash and cash equivalent |
(6,385 | ) | (8,318 | ) | 1,933 | ||||
Net increase (decrease) in cash and cash equivalent |
850 | (2,801 | ) | 3,651 | |||||
Cash and cash equivalent at beginning of period |
298,310 | 280,899 | 17,411 | ||||||
Cash and cash equivalent at end of period |
299,160 | 278,098 | 21,062 |
<Cash flow from operating activities>
Net cash provided by operating activities for this first half decreased by ¥65,032 million to ¥28,510 million from the previous first half of ¥93,542 million. This was due to an increase in inventories mainly in Equipment Group for this second half sale, and in addition, losses on inventories which did not involve cash disbursement. Net income decreased by ¥1,373 million compared with the previous first half.
<Cash flow from investment activities>
Net cash used in investing activities for this first half decreased by ¥19,634 million to ¥5,163 million from the previous first half of ¥24,797 million. This was due to an increase in proceeds from maturities of securities while purchases of securities were on the same level.
<Cash flow from financing activities>
Net cash used in financing activities for this first half decreased by ¥47,116 million to ¥16,112 million from the previous first half of ¥63,228 million. This was due mainly to an increase in short-term borrowings and a decrease in purchase of treasury stock.
3. Consolidated Capital Expenditures and Depreciation
(Yen in millions) |
|||||||||
Six Months Ended September 30, |
% Change |
||||||||
2003 |
2002 |
||||||||
Capital expenditures |
27,458 | 19,191 | 43.1 | ||||||
(% to net sales) |
5.3 | % | 3.7 | % | | ||||
Depreciation expenses |
28,933 | 31,328 | (7.6 | ) | |||||
(% to net sales) |
5.6 | % | 6.1 | % | |
| In the Electronic Device Group, new facilities were established to start up the micro device business. |
- 12 -
4. Non-Consolidated Results for the Six Months Ended September 30, 2003
(Yen in millions) | ||||||
Six Months Ended September 30, |
% Change | |||||
2003 |
2002 |
|||||
Net sales |
237,808 | 227,798 | 4.4 | |||
Profit from operations |
17,572 | 14,936 | 17.6 | |||
Recurring profit |
26,176 | 14,956 | 75.0 | |||
Net income |
16,159 | 9,291 | 73.9 |
- 13 -
Business Outlook for the Year Ending March 31, 2004 and Future Business Strategies
1. Consolidated Financial Forecasts
(Yen in millions, except per share amounts and exchange rates) |
|||||||
March 31, 2004 (Forecast) |
March 31, 2003 (Result) |
% Change |
|||||
Net sales |
1,140,000 | 1,069,770 | 6.6 | ||||
Profit from operations |
75,000 | 83,388 | (10.1 | ) | |||
Income before income taxes |
79,000 | 76,037 | 3.9 | ||||
Net income |
50,000 | 41,165 | 21.5 | ||||
Diluted earnings per share |
269.10 | 220.86 | 21.8 | ||||
Average US$ exchange rate |
114 | 122 | | ||||
Average Euro exchange rate |
130 | 121 | |
| Growth of the U.S. economy is expected to slow in the second half of the fiscal year ending March 31, 2004, due to the unwinding of the effects of tax cuts and a deterioration in the labor market, despite continuation of the low interest rate policy. The European economy is projected to remain generally weak. The outlook for the Japanese economy is still uncertain, as further appreciation of the yen risks having a negative effect on corporate earnings and consumer spending, despite a mild expansion of private-sector capital expenditures. |
| That said, production in the electronics industry looks set for a recovery path, as demand is likely to remain strong for computer equipment, digital home appliances, and mobile handsets incorporating color LCD displays and built-in cameras. |
| Kyocera is expecting the appreciation of the yen against the U.S. dollar and the Euro to continue in this second half, and, therefore, assumes an average exchange rate of 109 yen to the U.S. dollar and 126 yen to the Euro during this second half, and 114 yen to the U.S. dollar and 130 yen to the Euro for the year ending March 31, 2004. Accordingly, the appreciation of the yen against both currencies is projected to produce a negative impact on net sales and income before income taxes of approximately 43.1 billion yen and 3.9 billion yen, respectively. |
| Kyocera intends to introduce new products which had been developed, particularly in the Equipment Group, with a view to boosting both sales and profit. |
| Through the pursuit of synergies between Kinseki, Kyocera SLC Technologies and existing businesses, Kyocera strives to strengthen its competitiveness in each business sphere. |
| Kyocera is intent on improving profitability by expediting a structural reform of its management designed to create the optimal development, production and sales business structures. |
- 14 -
2. Financial Forecast by Segment Operations and Future Business Strategies
(Yen in millions) |
|||||||||
March 31, 2004 (Forecast) |
March 31, 2003 (Result) |
% Change |
|||||||
Net sales |
1,140,000 | 1,069,770 | 6.6 | ||||||
Fine Ceramics Group |
255,000 | 238,867 | 6.8 | ||||||
Electronic Device Group |
251,000 | 227,962 | 10.1 | ||||||
Equipment Group |
553,000 | 529,784 | 4.4 | ||||||
Others |
99,000 | 86,214 | 14.8 | ||||||
Adjustments and eliminations |
(18,000 | ) | (13,057 | ) | | ||||
Profit from operations |
72,200 | 77,877 | (7.3 | ) | |||||
Fine Ceramics Group |
28,100 | 18,797 | 49.5 | ||||||
Electronic Device Group |
2,800 | 11,816 | (76.3 | ) | |||||
Equipment Group |
30,500 | 40,020 | (23.8 | ) | |||||
Others |
10,800 | 7,244 | 49.1 |
<Fine Ceramics Group>
| Kyocera plans to further expand sales of ceramic packages for CCD and CMOS image devices to meet demand for mobile handsets with built-in cameras. |
| Kyocera anticipates strong sales of fine ceramic parts for LCD fabrication equipment and sapphire substrates for LCD projectors, in both of which we command a high market share. |
| Kyocera will develop, design, manufacture and market chip carriers for semiconductors and high-density printed circuit boards at Kyocera SLC Technologies, thereby maximizing Group synergies. |
| Kyocera will start producing modules for solar energy products in China to take advantage of the surging demand, expanding the business as we establish a global production setup. |
<Electronic Device Group>
| Kyocera plans to increase its market share of the market in this segment by expanding sales of high-capacitance ceramic capacitors for network infrastructure equipment and miniature timing devices for digital home appliances, and by developing high frequency modules for next-generation telecommunications terminals and automobiles. |
| Kyocera also plans to design a new organizational setup to maximize the Group synergies in the development, production and sales of passive components. |
<Equipment Group>
| In the telecommunications equipment business, Kyocera is working to ramp up mobile handset production in Mexico, which started during this first half. This will give us a competitive edge in the price of handsets in North America, and shore up global development and production control arrangements. Kyocera will supply handsets and base stations for the CDMA2000 1X-EVDO service, which is scheduled to start in Japan this fall, to further increase earnings. |
| Kyocera plans to increase sales by bringing to market new PHS products developed during this first half. |
| In the information equipment business, Kyocera is striving to increase sales through new introductions. Concretely, we plan to expand sales of color tandem printers, monochrome printers with an improved competitive edge, and digital multi-functional peripherals (MFPs) that include low-speed models. Standardization of engines and parts for the printers and digital MFPs will allow us to reduce production costs and improve price competitiveness. |
| In the optical instruments business, Kyocera plans to increase sales and profits by expanding our digital camera lines and increasing orders for optical modules for mobile handset with built-in camera. |
- 15 -
<Others>
| Kyocera Chemical plans to expand sales of environmentally-friendly materials, addressing the growing need for these in the market, and to create Group synergies with organic material parts and electronic components business. |
| KCCS is focused on expanding its content distribution services for mobile phone users in Japan and Southeast Asia, and the IT solutions business, including network services for the ubiquitous era, security systems and system integration services. |
3. Financial Forecast (Non-Consolidated)
(Yen in millions) |
|||||||
March 31, 2004 (Forecast) |
March 31, 2003 (Result) |
% Change |
|||||
Net sales |
510,000 | 482,834 | 5.6 | ||||
Profit from operations |
38,000 | 42,407 | (10.4 | ) | |||
Recurring profit |
56,500 | 54,685 | 3.3 | ||||
Net income |
38,000 | 27,923 | 36.1 |
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.
- 16 -
CONSOLIDATED BALANCE SHEETS
Yen in millions | ||||||||||||||||||
September 30, 2003 |
March 31, 2003 |
September 30, 2002 | ||||||||||||||||
Amount |
% |
Amount |
% |
Amount |
% | |||||||||||||
Current assets : |
||||||||||||||||||
Cash and cash equivalents |
¥ | 299,160 | ¥ | 298,310 | ¥ | 278,098 | ||||||||||||
Restricted cash |
54,121 | 56,368 | 57,505 | |||||||||||||||
Short-term investments |
10,321 | 14,651 | 14,200 | |||||||||||||||
Trade notes receivable |
30,753 | 35,446 | 30,354 | |||||||||||||||
Trade accounts receivable |
179,047 | 179,750 | 184,082 | |||||||||||||||
Short-term finance receivables |
71,195 | 31,254 | 37,185 | |||||||||||||||
Less allowances for doubtful accounts and sales returns |
(7,399 | ) | (7,703 | ) | (10,066 | ) | ||||||||||||
Inventories |
192,600 | 183,156 | 188,967 | |||||||||||||||
Deferred income taxes |
52,469 | 52,136 | 52,969 | |||||||||||||||
Other current assets |
28,536 | 19,054 | 18,496 | |||||||||||||||
Total current assets |
910,803 | 51.4 | 862,422 | 52.7 | 851,790 | 51.9 | ||||||||||||
Non-current assets : |
||||||||||||||||||
Investments in and advances to affiliates and unconsolidated subsidiaries |
21,387 | 24,398 | 28,106 | |||||||||||||||
Securities and other investments |
425,733 | 308,137 | 319,245 | |||||||||||||||
Total investments and advances |
447,120 | 25.2 | 332,535 | 20.3 | 347,351 | 21.2 | ||||||||||||
Long-term finance receivables |
90,034 | 5.1 | 125,728 | 7.7 | 116,151 | 7.1 | ||||||||||||
Property, plant and equipment, at cost : |
||||||||||||||||||
Land |
55,625 | 53,973 | 53,540 | |||||||||||||||
Buildings |
214,532 | 203,387 | 201,360 | |||||||||||||||
Machinery and equipment |
616,865 | 587,076 | 584,233 | |||||||||||||||
Construction in progress |
6,723 | 5,483 | 8,415 | |||||||||||||||
Less accumulated depreciation |
(636,732 | ) | (600,414 | ) | (583,546 | ) | ||||||||||||
257,013 | 14.5 | 249,505 | 15.3 | 264,002 | 16.1 | |||||||||||||
Goodwill |
24,587 | 1.4 | 25,703 | 1.6 | 25,966 | 1.6 | ||||||||||||
Intangible assets |
17,076 | 1.0 | 15,068 | 0.9 | 19,263 | 1.2 | ||||||||||||
Other assets |
24,917 | 1.4 | 24,053 | 1.5 | 15,405 | 0.9 | ||||||||||||
Total non-current assets |
860,747 | 48.6 | 772,592 | 47.3 | 788,138 | 48.1 | ||||||||||||
Total assets |
¥ | 1,771,550 | 100.0 | ¥ | 1,635,014 | 100.0 | ¥ | 1,639,928 | 100.0 | |||||||||
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, we separately disclose the intangible assets formerly included in the other assets. |
- 17 -
Yen in millions | ||||||||||||||||||
September 30, 2003 |
March 31, 2003 |
September 30, 2002 | ||||||||||||||||
Amount |
% |
Amount |
% |
Amount |
% | |||||||||||||
Current liabilities : |
||||||||||||||||||
Short-term borrowings |
¥ | 115,408 | ¥ | 107,886 | ¥ | 107,357 | ||||||||||||
Current portion of long-term debt |
55,258 | 30,198 | 21,300 | |||||||||||||||
Trade notes and accounts payable |
98,875 | 98,105 | 92,674 | |||||||||||||||
Other notes and accounts payable |
33,065 | 28,428 | 25,428 | |||||||||||||||
Accrued payroll and bonus |
33,633 | 33,059 | 33,317 | |||||||||||||||
Accrued income taxes |
19,753 | 28,060 | 17,051 | |||||||||||||||
Accrued litigation expenses |
39,495 | 41,862 | 48,191 | |||||||||||||||
Other accrued liabilities |
25,058 | 23,387 | 27,443 | |||||||||||||||
Other current liabilities |
13,422 | 14,589 | 14,104 | |||||||||||||||
Total current liabilities |
433,967 | 24.5 | 405,574 | 24.8 | 386,865 | 23.6 | ||||||||||||
Non-current liabilities : |
||||||||||||||||||
Long-term debt |
27,117 | 60,736 | 75,078 | |||||||||||||||
Accrued pension and severance costs |
78,685 | 74,906 | 59,962 | |||||||||||||||
Deferred income taxes |
77,267 | 22,879 | 35,248 | |||||||||||||||
Other non-current liabilities |
7,055 | 5,859 | 5,352 | |||||||||||||||
Total non-current liabilities |
190,124 | 10.7 | 164,380 | 10.0 | 175,640 | 10.7 | ||||||||||||
Total liabilities |
624,091 | 35.2 | 569,954 | 34.8 | 562,505 | 34.3 | ||||||||||||
Minority interests in subsidiaries |
55,057 | 3.1 | 61,560 | 3.8 | 64,235 | 3.9 | ||||||||||||
Stockholders equity : |
||||||||||||||||||
Common stock |
115,703 | 115,703 | 115,703 | |||||||||||||||
Additional paid-in capital |
162,068 | 167,675 | 167,609 | |||||||||||||||
Retained earnings |
838,555 | 828,350 | 809,863 | |||||||||||||||
Accumulated other comprehensive income |
7,443 | (56,194 | ) | (28,423 | ) | |||||||||||||
Common stock in treasury, at cost |
(31,367 | ) | (52,034 | ) | (51,564 | ) | ||||||||||||
Total stockholders equity |
1,092,402 | 61.7 | 1,003,500 | 61.4 | 1,013,188 | 61.8 | ||||||||||||
Total liabilities, minority interests and stockholders equity |
¥ | 1,771,550 | 100.0 | ¥ | 1,635,014 | 100.0 | ¥ | 1,639,928 | 100.0 | |||||||||
Note 3: Accumulated other comprehensive income is as follows:
Yen in millions |
||||||||||||
September 30, 2003 |
March 31, 2003 |
September 30, 2002 |
||||||||||
Net unrealized gains (losses) on securities |
¥ | 48,024 | ¥ | (29,955 | ) | ¥ | (18,014 | ) | ||||
Net unrealized losses on derivative financial instruments |
¥ | (203 | ) | ¥ | (331 | ) | ¥ | (422 | ) | |||
Minimum pension liability adjustments |
¥ | (10,931 | ) | ¥ | (10,931 | ) | | |||||
Foreign currency translation adjustments |
¥ | (29,447 | ) | ¥ | (14,977 | ) | ¥ | (9,987 | ) |
- 18 -
CONSOLIDATED STATEMENTS OF INCOME
Yen in millions |
||||||||||||||||||||||||
Six months ended September 30, |
Increase (Decrease) |
Year ended March 31, |
||||||||||||||||||||||
2003 |
2002 |
2003 |
||||||||||||||||||||||
Amount |
% |
Amount |
% |
% |
Amount |
% |
||||||||||||||||||
Net sales |
¥ | 518,378 | 100.0 | ¥ | 517,003 | 100.0 | 0.3 | ¥ | 1,069,770 | 100.0 | ||||||||||||||
Cost of sales |
397,654 | 76.7 | 391,425 | 75.7 | 1.6 | 796,258 | 74.4 | |||||||||||||||||
Gross profit |
120,724 | 23.3 | 125,578 | 24.3 | (3.9 | ) | 273,512 | 25.6 | ||||||||||||||||
Selling, general and administrative expenses |
98,170 | 18.9 | 88,631 | 17.2 | 10.8 | 190,124 | 17.8 | |||||||||||||||||
Profit from operations |
22,554 | 4.4 | 36,947 | 7.1 | (39.0 | ) | 83,388 | 7.8 | ||||||||||||||||
Other income and expenses : |
||||||||||||||||||||||||
Interest and dividend income |
2,419 | 0.4 | 2,740 | 0.5 | (11.7 | ) | 5,194 | 0.5 | ||||||||||||||||
Interest expense |
(701 | ) | (0.1 | ) | (763 | ) | (0.1 | ) | | (1,432 | ) | (0.1 | ) | |||||||||||
Foreign currency transaction losses, net |
(1,621 | ) | (0.3 | ) | (6,326 | ) | (1.2 | ) | | (5,405 | ) | (0.5 | ) | |||||||||||
Equity in earnings of affiliates and unconsolidated subsidiaries |
1,729 | 0.3 | 1,175 | 0.2 | 47.1 | 3,092 | 0.3 | |||||||||||||||||
Loss on devaluation of investment in an affiliate |
| | | | | (5,159 | ) | (0.5 | ) | |||||||||||||||
Losses on devaluation of investment securities |
(105 | ) | 0.0 | (347 | ) | (0.1 | ) | | (2,883 | ) | (0.3 | ) | ||||||||||||
Other, net |
852 | 0.1 | 167 | 0.1 | 410.2 | (758 | ) | (0.1 | ) | |||||||||||||||
Total other income and expenses |
2,573 | 0.4 | (3,354 | ) | (0.6 | ) | | (7,351 | ) | (0.7 | ) | |||||||||||||
Income before income taxes, minority interests and cumulative effect of change in accounting principle |
25,127 | 4.8 | 33,593 | 6.5 | (25.2 | ) | 76,037 | 7.1 | ||||||||||||||||
Income taxes |
12,749 | 2.4 | 14,080 | 2.7 | (9.5 | ) | 32,780 | 3.1 | ||||||||||||||||
Income before minority interests and cumulative effect of change in accounting principle |
12,378 | 2.4 | 19,513 | 3.8 | (36.6 | ) | 43,257 | 4.0 | ||||||||||||||||
Minority interests |
3,376 | 0.7 | (130 | ) | (0.1 | ) | | 164 | 0.1 | |||||||||||||||
Income before cumulative effect of change in accounting principle |
15,754 | 3.0 | 19,383 | 3.7 | (18.7 | ) | 43,421 | 4.1 | ||||||||||||||||
Cumulative effect of change in accounting principle net of taxes |
| | (2,256 | ) | (0.4 | ) | | (2,256 | ) | (0.3 | ) | |||||||||||||
Net income |
¥ | 15,754 | 3.0 | ¥ | 17,127 | 3.3 | (8.0 | ) | ¥ | 41,165 | 3.8 | |||||||||||||
Earnings per share: |
||||||||||||||||||||||||
Income before cumulative effect of change in accounting principle : |
||||||||||||||||||||||||
Basic |
¥ | 84.79 | ¥ | 103.27 | ¥ | 233.02 | ||||||||||||||||||
Diluted |
¥ | 84.79 | ¥ | 103.22 | ¥ | 232.97 | ||||||||||||||||||
Net income: |
||||||||||||||||||||||||
Basic |
¥ | 84.79 | ¥ | 91.25 | ¥ | 220.91 | ||||||||||||||||||
Diluted |
¥ | 84.79 | ¥ | 91.21 | ¥ | 220.86 | ||||||||||||||||||
Weighted average number of shares of common stock outstanding (shares in thousands) : |
||||||||||||||||||||||||
Basic |
185,803 | 187,694 | 186,338 | |||||||||||||||||||||
Diluted |
185,803 | 187,780 | 186,382 |
- 19 -
Notes:
1. | The Company applies SFAS No.130, Financial Reporting of Comprehensive Income. Based on this standard, comprehensive income for the six months ended September 30, 2003 and 2002 was an increase of 79,391 million yen and an increase of 11,454 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 a cumulative effect of this change in accounting principle, net of tax. The losses of 2,256 million yen were recorded in the result for the six months ended September 30, 2002. |
- 20 -
CONSOLIDATED STATEMENTS OF STOCKHOLDERS EQUITY
(Yen in millions and shares in thousands) |
|||||||||||||||||||||||
(Number of shares of common stock) |
Common stock |
Additional paid-in capital |
Retained earnings |
Accumulated other comprehensive income |
Treasury stock, at cost |
Comprehensive income |
|||||||||||||||||
Balance, March 31, 2002 (189,042) |
¥ | 115,703 | ¥ | 158,228 | ¥ | 798,407 | ¥ | (22,750 | ) | ¥ | (10,110 | ) | |||||||||||
Net income for the year |
41,165 | ¥ | 41,165 | ||||||||||||||||||||
Accumulated other comprehensive income |
(33,444 | ) | (33,444 | ) | |||||||||||||||||||
Total comprehensive income for the year |
¥ | 7,721 | |||||||||||||||||||||
Stock issuance for acquisition of a subsidiary (991) |
9,381 | ||||||||||||||||||||||
Cash dividends |
(11,222 | ) | |||||||||||||||||||||
Purchase of treasury stock (5,080) |
(42,015 | ) | |||||||||||||||||||||
Reissuance of treasury stock (11) |
0 | 91 | |||||||||||||||||||||
Stock option plan of a subsidiary |
66 | ||||||||||||||||||||||
Balance, March 31, 2003 (184,964) |
115,703 | 167,675 | 828,350 | (56,194 | ) | (52,034 | ) | ||||||||||||||||
Net income for the first half |
15,754 | ¥ | 15,754 | ||||||||||||||||||||
Accumulated other comprehensive income |
63,637 | 63,637 | |||||||||||||||||||||
Total comprehensive income for the first half |
¥ | 79,391 | |||||||||||||||||||||
Cash dividends |
(5,549 | ) | |||||||||||||||||||||
Purchase of treasury stock (11) |
(72 | ) | |||||||||||||||||||||
Allocation of treasury stock for stock swap (2,529) |
(5,607 | ) | 20,739 | ||||||||||||||||||||
Balance, September 30, 2003 (187,482) |
¥ | 115,703 | ¥ | 162,068 | ¥ | 838,555 | ¥ | 7,443 | ¥ | (31,367 | ) | ||||||||||||
(Yen in millions and shares in thousands) |
||||||||||||||||||||||
(Number of shares of common stock) |
Common stock |
Additional paid-in capital |
Retained earnings |
Accumulated other comprehensive income |
Treasury stock, at cost |
Comprehensive income |
||||||||||||||||
Balance, March 31, 2002 (189,042) |
¥ | 115,703 | ¥ | 158,228 | ¥ | 798,407 | ¥ | (22,750 | ) | ¥ | (10,110 | ) | ||||||||||
Net income for the first half |
17,127 | ¥ | 17,127 | |||||||||||||||||||
Accumulated other comprehensive income |
(5,673 | ) | (5,673 | ) | ||||||||||||||||||
Total comprehensive income for the first half |
¥ | 11,454 | ||||||||||||||||||||
Stock issuance for acquisition of a subsidiary (991) |
9,381 | |||||||||||||||||||||
Cash dividends |
(5,671 | ) | ||||||||||||||||||||
Purchase of treasury stock (5,016) |
(41,540 | ) | ||||||||||||||||||||
Reissuance of treasury stock (11) |
0 | 86 | ||||||||||||||||||||
Balance, September 30, 2002 (185,028) |
¥ | 115,703 | ¥ | 167,609 | ¥ | 809,863 | ¥ | (28,423 | ) | ¥ | (51,564 | ) | ||||||||||
- 21 -
CONSOLIDATED STATEMENTS OF CASH FLOWS
Yen in millions |
||||||||||||
Six months ended September 30, |
Year ended March 31, |
|||||||||||
2003 |
2002 |
2003 |
||||||||||
Cash flows from operating activities: |
||||||||||||
Net income |
¥ | 15,754 | ¥ | 17,127 | ¥ | 41,165 | ||||||
Adjustments to reconcile net income to net cash provided by operating activities : |
||||||||||||
Depreciation and amortization |
33,667 | 35,133 | 75,320 | |||||||||
Losses on inventories |
9,338 | 3,384 | 6,966 | |||||||||
Loss on devaluation of investment in an affiliate |
| | 5,159 | |||||||||
Cumulative effect of change in accounting principle |
| 2,256 | 2,256 | |||||||||
Foreign currency adjustments |
1,308 | 6,052 | 5,139 | |||||||||
Decrease (increase) in receivables |
2,295 | 4,964 | (948 | ) | ||||||||
(Increase) decrease in inventories |
(22,059 | ) | 10,288 | 11,067 | ||||||||
(Increase) decrease in other current assets |
(4,815 | ) | 1,421 | 1,128 | ||||||||
Increase in notes and accounts payable |
5,627 | 8,459 | 13,247 | |||||||||
Other, net |
(12,605 | ) | 4,458 | 255 | ||||||||
Net cash provided by operating activities |
28,510 | 93,542 | 160,754 | |||||||||
Cash flows from investing activities : |
||||||||||||
Payments for purchases of securities |
(22,632 | ) | (22,312 | ) | (52,244 | ) | ||||||
Payments for purchases of investments and advances |
(606 | ) | (542 | ) | (1,035 | ) | ||||||
Sales and maturities of securities |
42,358 | 17,460 | 34,350 | |||||||||
Payments for purchases of property, plant and equipment, and intangible assets |
(29,128 | ) | (23,945 | ) | (47,101 | ) | ||||||
Proceeds from sales of property, plant and equipment, and intangible assets |
1,123 | 977 | 3,122 | |||||||||
Acquisitions of businesses, net of cash acquired |
5,135 | 4,058 | 4,058 | |||||||||
Restricted cash |
(1,994 | ) | (1,476 | ) | (1,477 | ) | ||||||
Other, net |
581 | 983 | 1,815 | |||||||||
Net cash used in investing activities |
(5,163 | ) | (24,797 | ) | (58,512 | ) | ||||||
Cash flows from financing activities : |
||||||||||||
Increase (decrease) in short-term debt |
6,701 | (3,898 | ) | (3,475 | ) | |||||||
Proceeds from issuance of long-term debt |
1,168 | 894 | 1,568 | |||||||||
Payments of long-term debt |
(18,361 | ) | (13,241 | ) | (19,152 | ) | ||||||
Dividends paid |
(6,114 | ) | (6,269 | ) | (12,382 | ) | ||||||
Purchase of treasury stock |
(49 | ) | (41,535 | ) | (42,010 | ) | ||||||
Other, net |
543 | 821 | 789 | |||||||||
Net cash used in financing activities |
(16,112 | ) | (63,228 | ) | (74,662 | ) | ||||||
Effect of exchange rate changes on cash and cash equivalents |
(6,385 | ) | (8,318 | ) | (10,169 | ) | ||||||
Net increase (decrease) in cash and cash equivalents |
850 | (2,801 | ) | 17,411 | ||||||||
Cash and cash equivalents at beginning of period |
298,310 | 280,899 | 280,899 | |||||||||
Cash and cash equivalents at end of period |
¥ | 299,160 | ¥ | 278,098 | ¥ | 298,310 | ||||||
- 22 -
SUPPLEMENTAL CASH FLOW INFORMATION
Yen in millions |
||||||||||||
Six months ended September 30, |
Year ended March 31, |
|||||||||||
2003 |
2002 |
2003 |
||||||||||
Cash paid during the period for : |
||||||||||||
Interest |
¥ | 1,632 | ¥ | 1,755 | ¥ | 3,230 | ||||||
Income taxes |
26,699 | 19,312 | 32,012 | |||||||||
Acquisitions of businesses : |
||||||||||||
Fair value of assets acquired |
¥ | 47,510 | ¥ | 32,015 | ¥ | 32,015 | ||||||
Fair value of liabilities assumed |
(19,086 | ) | (22,584 | ) | (22,584 | ) | ||||||
Investments accounted for by the equity method |
(4,600 | ) | | | ||||||||
Stock issuance for acquisition |
(15,132 | ) | (9,381 | ) | (9,381 | ) | ||||||
Cash acquired |
(13,827 | ) | (4,108 | ) | (4,108 | ) | ||||||
¥ | (5,135 | ) | ¥ | (4,058 | ) | ¥ | (4,058 | ) | ||||
- 23 -
SEGMENT INFORMATION
1. Operating segments : | Yen in millions |
||||||||||||||
Six months ended September 30, |
Increase (Decrease) |
Year ended March 31, |
|||||||||||||
2003 |
2002 |
2003 |
|||||||||||||
Amount |
Amount |
% |
Amount |
||||||||||||
Net sales: |
|||||||||||||||
Fine Ceramics Group |
¥ | 119,399 | ¥ | 119,077 | 0.3 | ¥ | 238,867 | ||||||||
Electronic Device Group |
119,787 | 115,491 | 3.7 | 227,962 | |||||||||||
Equipment Group |
241,372 | 250,862 | (3.8 | ) | 529,784 | ||||||||||
Others |
46,181 | 37,785 | 22.2 | 86,214 | |||||||||||
Adjustments and eliminations |
(8,361 | ) | (6,212 | ) | | (13,057 | ) | ||||||||
¥ | 518,378 | ¥ | 517,003 | 0.3 | ¥ | 1,069,770 | |||||||||
Operating profit : |
|||||||||||||||
Fine Ceramics Group |
¥ | 11,322 | ¥ | 8,471 | 33.7 | ¥ | 18,797 | ||||||||
Electronic Device Group |
(6,392 | ) | 5,974 | | 11,816 | ||||||||||
Equipment Group |
10,274 | 17,028 | (39.7 | ) | 40,020 | ||||||||||
Others |
4,805 | 3,216 | 49.4 | 7,244 | |||||||||||
20,009 | 34,689 | (42.3 | ) | 77,877 | |||||||||||
Corporate |
2,960 | (2,467 | ) | | (5,382 | ) | |||||||||
Equity in earnings of affiliates and unconsolidated subsidiaries |
1,729 | 1,175 | 47.1 | 3,092 | |||||||||||
Adjustments and eliminations |
429 | 196 | 118.9 | 450 | |||||||||||
Income before income taxes |
¥ | 25,127 | ¥ | 33,593 | (25.2 | ) | ¥ | 76,037 | |||||||
Depreciation and amortization : |
|||||||||||||||
Fine Ceramics Group |
¥ | 7,775 | ¥ | 9,044 | (14.0 | ) | ¥ | 18,337 | |||||||
Electronic Device Group |
11,293 | 12,533 | (9.9 | ) | 25,870 | ||||||||||
Equipment Group |
10,979 | 10,359 | 6.0 | 24,445 | |||||||||||
Others |
2,301 | 1,779 | 29.3 | 4,158 | |||||||||||
Corporate |
1,319 | 1,418 | (7.0 | ) | 2,510 | ||||||||||
¥ | 33,667 | ¥ | 35,133 | (4.2 | ) | ¥ | 75,320 | ||||||||
Capital expenditures : |
|||||||||||||||
Fine Ceramics Group |
¥ | 5,827 | ¥ | 4,069 | 43.2 | ¥ | 8,095 | ||||||||
Electronic Device Group |
9,111 | 6,391 | 42.6 | 13,501 | |||||||||||
Equipment Group |
9,004 | 6,673 | 34.9 | 13,311 | |||||||||||
Others |
530 | 1,078 | (50.8 | ) | 4,115 | ||||||||||
Corporate |
2,986 | 980 | 204.7 | 1,592 | |||||||||||
¥ | 27,458 | ¥ | 19,191 | 43.1 | ¥ | 40,614 | |||||||||
- 24 -
2. Geographic segments (Sales and operating profit by geographic area)
Yen in millions |
|||||||||||||||
Six months ended September 30, |
Increase (Decrease) |
Year ended March 31, |
|||||||||||||
2003 |
2002 |
2003 |
|||||||||||||
Amount |
Amount |
% |
Amount |
||||||||||||
Net sales: |
|||||||||||||||
Japan |
¥ | 240,051 | ¥ | 226,298 | 6.1 | ¥ | 489,408 | ||||||||
Intra-group sales and transfer between geographic areas |
134,338 | 124,214 | 8.2 | 244,316 | |||||||||||
374,389 | 350,512 | 6.8 | 733,724 | ||||||||||||
United States of America |
135,540 | 161,276 | (16.0 | ) | 307,298 | ||||||||||
Intra-group sales and transfer between geographic areas |
11,590 | 11,498 | 0.8 | 23,415 | |||||||||||
147,130 | 172,774 | (14.8 | ) | 330,713 | |||||||||||
Asia |
58,985 | 49,543 | 19.1 | 107,857 | |||||||||||
Intra-group sales and transfer between geographic areas |
46,484 | 38,866 | 19.6 | 74,419 | |||||||||||
105,469 | 88,409 | 19.3 | 182,276 | ||||||||||||
Europe |
74,962 | 72,979 | 2.7 | 151,525 | |||||||||||
Intra-group sales and transfer between geographic areas |
15,868 | 15,085 | 5.2 | 29,666 | |||||||||||
90,830 | 88,064 | 3.1 | 181,191 | ||||||||||||
Others |
8,840 | 6,907 | 28.0 | 13,682 | |||||||||||
Intra-group sales and transfer between geographic areas |
3,494 | 4,266 | (18.1 | ) | 8,269 | ||||||||||
12,334 | 11,173 | 10.4 | 21,951 | ||||||||||||
Adjustments and eliminations |
(211,774 | ) | (193,929 | ) | | (380,085 | ) | ||||||||
¥ | 518,378 | ¥ | 517,003 | 0.3 | ¥ | 1,069,770 | |||||||||
Operating profit: |
|||||||||||||||
Japan |
¥ | 39,424 | ¥ | 30,145 | 30.8 | ¥ | 75,384 | ||||||||
United States of America |
(4,694 | ) | 4,640 | | 4,189 | ||||||||||
Asia |
3,094 | 5,668 | (45.4 | ) | 10,368 | ||||||||||
Europe |
(14,296 | ) | (4,268 | ) | | (9,595 | ) | ||||||||
Others |
416 | 356 | 16.9 | 842 | |||||||||||
23,944 | 36,541 | (34.5 | ) | 81,188 | |||||||||||
Adjustments and eliminations |
(3,506 | ) | (1,656 | ) | | (2,861 | ) | ||||||||
20,438 | 34,885 | (41.4 | ) | 78,327 | |||||||||||
Corporate |
2,960 | (2,467 | ) | | (5,382 | ) | |||||||||
Equity in earnings of affiliates and unconsolidated subsidiaries |
1,729 | 1,175 | 47.1 | 3,092 | |||||||||||
Income before income taxes |
¥ | 25,127 | ¥ | 33,593 | (25.2 | ) | ¥ | 76,037 | |||||||
- 25 -
3. Geographic segments (Sales by region) :
Yen in millions | |||||||||||||||||||||||||
Six months ended September 30, |
Increase (Decrease) |
Year ended March 31, | |||||||||||||||||||||||
2003 |
2002 |
2003 | |||||||||||||||||||||||
Amount |
% |
Amount |
% |
Amount |
% |
Amount |
% | ||||||||||||||||||
Japan |
¥ | 211,276 | 40.8 | ¥ | 194,708 | 37.7 | ¥ | 16,568 | 8.5 | ¥ | 423,190 | 39.6 | |||||||||||||
United States of America |
114,335 | 22.0 | 150,977 | 29.2 | (36,642 | ) | (24.3 | ) | 264,755 | 24.7 | |||||||||||||||
Asia |
90,122 | 17.4 | 80,685 | 15.6 | 9,437 | 11.7 | 178,384 | 16.7 | |||||||||||||||||
Europe |
73,472 | 14.2 | 68,161 | 13.2 | 5,311 | 7.8 | 144,293 | 13.5 | |||||||||||||||||
Others |
29,173 | 5.6 | 22,472 | 4.3 | 6,701 | 29.8 | 59,148 | 5.5 | |||||||||||||||||
Net sales |
¥ | 518,378 | 100.0 | ¥ | 517,003 | 100.0 | ¥ | 1,375 | 0.3 | ¥ | 1,069,770 | 100.0 | |||||||||||||
Sales outside Japan |
¥ | 307,102 | ¥ | 322,295 | ¥ | (15,193 | ) | (4.7 | ) | ¥ | 646,580 | ||||||||||||||
Sales outside Japan ratio to net sales |
59.2 | % | 62.3 | % | 60.4 | % |
- 26 -
INVESTMENTS IN DEBT AND EQUITY SECURITIES
Available-for-sale securities are recorded at fair value, with unrealized gains and losses excluded from income and reported in other comprehensive income, net of tax. Held-to-maturity securities are recorded at amortized cost. Investments in debt and equity securities as of September 30, 2003, March 31, 2003 and September 30, 2002, included in short-term investments (current assets) and in securities and other investments (non-current assets) are summarized as follows :
Yen in millions | ||||||||||||||||||||||||
September 30, 2003 |
March 31, 2003 | |||||||||||||||||||||||
Cost |
Aggregate fair values |
Gross unrealized gains |
Gross unrealized losses |
Cost |
Aggregate fair values |
Gross unrealized gains |
Gross unrealized losses | |||||||||||||||||
Available-for-sale securities : |
||||||||||||||||||||||||
Corporate debt securities |
¥ | 28,622 | ¥ | 28,541 | ¥ | 22 | ¥ | 103 | ¥ | 29,754 | ¥ | 29,610 | ¥ | 6 | ¥ | 150 | ||||||||
Other debt securities |
34,168 | 30,748 | 36 | 3,456 | 36,927 | 32,566 | 4 | 4,365 | ||||||||||||||||
Equity securities |
261,639 | 345,915 | 84,560 | 284 | 259,942 | 212,902 | 2,671 | 49,711 | ||||||||||||||||
Total available-for-sale securities |
324,429 | 405,204 | 84,618 | 3,843 | 326,623 | 275,078 | 2,681 | 54,226 | ||||||||||||||||
Held-to-maturity securities : |
||||||||||||||||||||||||
Corporate debt securities |
4,660 | 4,655 | | 5 | 19,240 | 19,190 | 0 | 50 | ||||||||||||||||
Other debt securities |
22,389 | 22,448 | 59 | | 25,276 | 25,327 | 51 | 0 | ||||||||||||||||
Total held-to-maturity securities |
27,049 | 27,103 | 59 | 5 | 44,516 | 44,517 | 51 | 50 | ||||||||||||||||
Total investments in debt and equity securities |
¥ | 351,478 | ¥ | 432,307 | ¥ | 84,677 | ¥ | 3,848 | ¥ | 371,139 | ¥ | 319,595 | ¥ | 2,732 | ¥ | 54,276 | ||||||||
September 30, 2002 |
||||||||||||||||||||||||
Cost |
Aggregate fair values |
Gross unrealized gains |
Gross unrealized losses |
|||||||||||||||||||||
Available-for-sale securities : |
||||||||||||||||||||||||
Corporate debt securities |
¥ | 22,725 | ¥ | 22,447 | ¥ | 14 | ¥ | 292 | ||||||||||||||||
Other debt securities |
24,056 | 20,044 | 4 | 4,016 | ||||||||||||||||||||
Equity securities |
262,183 | 235,492 | 5,227 | 31,918 | ||||||||||||||||||||
Total available-for-sale securities |
308,964 | 277,983 | 5,245 | 36,226 | ||||||||||||||||||||
Held-to-maturity securities : |
||||||||||||||||||||||||
Corporate debt securities |
23,340 | 23,141 | 1 | 200 | ||||||||||||||||||||
Other debt securities |
28,987 | 29,210 | 223 | | ||||||||||||||||||||
Total held-to-maturity securities |
52,327 | 52,351 | 224 | 200 | ||||||||||||||||||||
Total investments in debt and equity securities |
¥ | 361,291 | ¥ | 330,334 | ¥ | 5,469 | ¥ | 36,426 | ||||||||||||||||
Note: | Cost represents amortized cost for debt securities and acquisition cost for equity securities. The cost basis of the individual securities is written down to fair value as a new cost basis when other-than-temporary impairment is recognized. |
- 27 -
DERIVATIVE FINANCIAL INSTRUMENTS
The aggregate contract amounts and fair value of derivative financial instruments are as follows:
(Negative figures in fair value represents valuation loss.)
Yen in millions |
||||||||||||||
September 30, 2003 |
March 31, 2003 |
|||||||||||||
Contract Amount |
Fair Value |
Contract Amount |
Fair Value |
|||||||||||
Currency swaps |
¥ | 587 | ¥ | 34 | ¥ | 587 | ¥ | (10 | ) | |||||
Foreign currency forward contracts to sell |
76,106 | 2,567 | 63,074 | (1,142 | ) | |||||||||
Foreign currency forward contracts to buy |
10,270 | (435 | ) | 7,289 | 108 | |||||||||
Interest swaps |
86,246 | (1,467 | ) | 93,870 | (2,243 | ) | ||||||||
Yen in millions |
||||||||||||||
September 30, 2002 |
||||||||||||||
Contract Amount |
Fair Value |
|||||||||||||
Currency swaps |
¥ | 669 | ¥ | 58 | ||||||||||
Foreign currency forward contracts to sell |
70,194 | (885 | ) | |||||||||||
Foreign currency forward contracts to buy |
7,066 | 85 | ||||||||||||
Interest swaps |
99,069 | (2,329 | ) |
Note : The fair value was estimated based on quotes from financial institutions.
- 28 -
BASIS OF PREPARATION OF CONSOLIDATED FINANCIAL STATEMENTS
1. Scope of consolidation and application of the equity method : | ||
Major consolidated subsidiaries : |
||
AVX CORPORATION | ||
KYOCERA WIRELESS CORP. | ||
KYOCERA MITA CORPORATION | ||
KYOCERA ELCO CORPORATION | ||
Major affiliates accounted for by the equity method : | ||
TAITO CORPORATION | ||
2. Changes in scope of consolidation and application of the equity method : | ||
Consolidation | ||
(Increase) Established : 8 |
KYOCERA SLC TECHNOLOGIES CORP. and others | |
Acquired : 10 |
KINSEKI, LTD., and others | |
(Decrease) Liquidated : 2 |
PRECISION CARBIDE TOOL CO., INC and other | |
Equity method | ||
(Increase) None |
||
(Decrease) Moved to consolidation : 1 KINSEKI, LTD. | ||
Liquidated : 1 SANGA FOODS CO., LTD. |
3. Employee benefits plan
Kyocera adopts SFAS No. 87 for the calculation of employee benefits plan.
Employees of the Company and its certain domestic subsidiaries are covered by the Kyocera Employee Pension Fund (EPF), which was established pursuant to the Japanese Welfare Pension Insurance Law (JWPIL). Benefits under the EPF generally are based on the current rate of base salary, employees position length of service and conditions under which the termination occurs. In accordance with the JWPIL, a portion of the governments social security program, under which the employer and employee contribute an equal amount, is contracted out to the Company and its certain domestic subsidiaries (contracted-out-portion). The Company and its certain domestic subsidiaries adds to it their own non-contributory pension plan (corporate portion). Employees of some overseas subsidiaries of the Company are covered by non-contributory defined benefit pension plans.
(Supplemental information)
As a result of enactment of the Defined Contribution Corporate Pension Plan Law, the Company and its certain domestic subsidiaries were approved by the Ministry of the Health, Labor and Welfare for the exemption from the obligation for benefits related to future employee service under the substitutional portion in the previous fiscal year.
Gain related to this transfer process shall be recognized upon completion of the transfer to the government of the substitutional portion of the benefit obligation and related plan assets. As the dates of the completion have not been decided yet, such gain is not reflected in the consolidated and non-consolidated financial forecasts of the Company relating to the fiscal year ending March 2004 in this Form 6-K.
For your information, given that the transfer is completed by March 31, 2004, the Company estimates special gain of approximately 31.3 billion yen on non-consolidated basis under accounting principles generally accepted in Japan and approximately 15.7 billion yen on a consolidated basis in accordance with accounting principles generally accepted in the United States of America. Actual result could differ from these estimations.
- 29 -
The interim non-consolidated financial statements are in conformity with accounting principles generally accepted in Japan.
Date of the board of directors meeting for the interim results : October 28, 2003
Payment date of interim dividends: December 5, 2003
1. Results for the six months ended September 30, 2003 :
(1) Results of operations :
Japanese yen | |||||||||||
Six months ended September 30, |
Year ended March 31, | ||||||||||
2003 |
2002 |
2003 | |||||||||
Net sales |
¥ | 237,808 million | ¥ | 227,798 million | ¥ | 482,834 million | |||||
% change from the previous period |
4.4 | % | (12.1 | )% | |||||||
Profit from operations |
17,572 million | 14,936 million | 42,407 million | ||||||||
% change from the previous period |
17.6 | % | (40.9 | )% | |||||||
Recurring profit |
26,176 million | 14,956 million | 54,685 million | ||||||||
% change from the previous period |
75.0 | % | (52.8 | )% | |||||||
Net income |
16,159 million | 9,291 million | 27,923 million | ||||||||
% change from the previous period |
73.9 | % | (53.3 | )% | |||||||
Earnings per share |
¥ | 86.97 | ¥ | 49.50 | ¥ | 149.45 | |||||
Notes : | ||
1. Average number of common stock outstanding during the period : | ||
Six months ended September 30, 2003 |
185,804,001 shares | |
Six months ended September 30, 2002 |
187,694,080 shares | |
Year ended March 31, 2003 |
186,338,707 shares | |
2. Change in accounting policies : |
None |
(2) Dividend information :
Japanese yen | |||||||||
Six months ended September 30, |
Year ended March 31, | ||||||||
2003 |
2002 |
2003 | |||||||
Interim dividends per share |
¥ | 30.00 | ¥ | 30.00 | | ||||
Annual dividends per share |
| | ¥ | 60.00 |
- 30 -
(3) Financial Condition :
Japanese yen |
||||||||||||
September 30, |
March 31, |
|||||||||||
2003 |
2002 |
2003 |
||||||||||
Total assets |
¥ | 1,251,420 million | ¥ | 1,097,263 million | ¥ | 1,094,672 million | ||||||
Stockholders equity |
980,458 million | 862,904 million | 865,147 million | |||||||||
Stockholders equity to total assets |
78.3 | % | 78.6 | % | 79.0 | % | ||||||
Stockholders equity per share |
¥ | 5,229.48 | ¥ | 4,663.62 | ¥ | 4,676.97 |
Notes : Total number of shares outstanding as of : | ||
September 30, 2003 |
187,486,635 shares | |
September 30, 2002 |
185,029,092 shares | |
March 31, 2003 |
184,964,360 shares | |
Total number of treasury stock as of : | ||
September 30, 2003 |
3,822,655 shares | |
September 30, 2002 |
6,280,198 shares | |
March 31, 2003 |
6,344,930 shares |
2. Forecast for the year ending March 31, 2004 :
Japanese yen | |||
Year ending March 31, 2004 | |||
Net sales |
¥ | 510,000 million | |
Recurring profit |
56,500 million | ||
Net income |
38,000 million | ||
Annual dividends per share |
60.00 | ||
(Year-end dividends per share) |
30.00 | ||
Note : Forecast for annual earnings per share: |
¥ | 202.28 |
With regard to the forecasts set forth above, please refer to the accompanying Forward Looking Statements on page 16.
- 31 -
BALANCE SHEETS
Yen in millions | ||||||||||||||||||
September 30, | March 31, | September 30, | ||||||||||||||||
2003 |
2003 |
2002 | ||||||||||||||||
Amount |
% |
Amount |
% |
Amount |
% | |||||||||||||
Current assets : |
||||||||||||||||||
Cash and bank deposits |
¥ | 203,935 | ¥ | 208,418 | ¥ | 184,843 | ||||||||||||
Trade notes receivable |
47,230 | 47,526 | 41,814 | |||||||||||||||
Trade accounts receivable |
81,105 | 74,155 | 78,313 | |||||||||||||||
Marketable securities |
3,660 | 14,649 | 14,199 | |||||||||||||||
Finished goods and merchandise |
20,234 | 21,829 | 27,419 | |||||||||||||||
Raw materials |
22,370 | 19,413 | 17,801 | |||||||||||||||
Work in process |
19,839 | 19,838 | 19,406 | |||||||||||||||
Supplies |
579 | 525 | 560 | |||||||||||||||
Deferred income taxes |
27,535 | 28,592 | 30,378 | |||||||||||||||
Short-term loans |
5,136 | 4,036 | 6,549 | |||||||||||||||
Other accounts receivable |
3,306 | 2,737 | 3,206 | |||||||||||||||
Other current assets |
1,591 | 1,191 | 779 | |||||||||||||||
Less allowances for doubtful accounts |
(137 | ) | (26 | ) | (247 | ) | ||||||||||||
Total current assets |
436,383 | 34.9 | 442,887 | 40.5 | 425,025 | 38.7 | ||||||||||||
Non-current assets : |
||||||||||||||||||
Tangible fixed assets : |
||||||||||||||||||
Buildings |
38,291 | 38,924 | 40,949 | |||||||||||||||
Structures |
2,358 | 2,451 | 2,577 | |||||||||||||||
Machinery and equipment |
37,570 | 36,012 | 41,121 | |||||||||||||||
Vehicles |
28 | 28 | 30 | |||||||||||||||
Tools, furniture and fixtures |
9,832 | 9,016 | 9,013 | |||||||||||||||
Land |
31,979 | 30,386 | 30,386 | |||||||||||||||
Construction in progress |
629 | 650 | 610 | |||||||||||||||
Total tangible fixed assets |
120,687 | 9.6 | 117,472 | 10.7 | 124,690 | 11.4 | ||||||||||||
Intangible assets : |
||||||||||||||||||
Patent rights and others |
3,264 | 2,576 | 3,278 | |||||||||||||||
Total intangible assets |
3,264 | 0.3 | 2,576 | 0.2 | 3,278 | 0.3 | ||||||||||||
Investments and other assets : |
||||||||||||||||||
Investments in securities |
420,146 | 300,916 | 311,869 | |||||||||||||||
Investments in subsidiaries |
234,188 | 194,160 | 194,160 | |||||||||||||||
Investments in subsidiaries other than equity securities |
25,078 | 24,244 | 23,580 | |||||||||||||||
Long-term loans |
7,898 | 10,456 | 12,334 | |||||||||||||||
Long-term prepaid expenses |
5,726 | 3,935 | 4,336 | |||||||||||||||
Other investments |
5,034 | 5,002 | 5,402 | |||||||||||||||
Less allowances for doubtful accounts |
(1,034 | ) | (1,030 | ) | (1,465 | ) | ||||||||||||
Less allowances for losses on investments |
(5,950 | ) | (5,950 | ) | (5,950 | ) | ||||||||||||
Total investments and other assets |
691,086 | 55.2 | 531,736 | 48.6 | 544,268 | 49.6 | ||||||||||||
Total non-current assets |
815,037 | 65.1 | 651,785 | 59.5 | 672,238 | 61.3 | ||||||||||||
Total assets |
¥ | 1,251,420 | 100.0 | ¥ | 1,094,672 | 100.0 | ¥ | 1,097,263 | 100.0 | |||||||||
- 32 -
Yen in millions |
|||||||||||||||||||||
September 30, | March 31, | September 30, | |||||||||||||||||||
2003 |
2003 |
2002 |
|||||||||||||||||||
Amount |
% |
Amount |
% |
Amount |
% |
||||||||||||||||
Current liabilities : |
|||||||||||||||||||||
Trade notes payable |
| | ¥ | 688 | |||||||||||||||||
Trade accounts payable |
¥ | 50,747 | ¥ | 50,766 | 44,818 | ||||||||||||||||
Other payables |
54,313 | 63,600 | 65,862 | ||||||||||||||||||
Accrued expenses |
6,947 | 7,571 | 6,892 | ||||||||||||||||||
Accrued income taxes |
7,300 | 8,500 | 7,700 | ||||||||||||||||||
Deposits received |
2,247 | 2,722 | 2,971 | ||||||||||||||||||
Accured bonuses |
10,520 | 10,900 | 11,000 | ||||||||||||||||||
Provision for warranties |
673 | 778 | 467 | ||||||||||||||||||
Provision for sales returns |
169 | 217 | 247 | ||||||||||||||||||
Other notes payable |
| | 76 | ||||||||||||||||||
Other current liabilities |
76 | 201 | 285 | ||||||||||||||||||
Total current liabilities |
132,992 | 10.7 | 145,257 | 13.3 | 141,010 | 12.9 | |||||||||||||||
Non-current liabilities : |
|||||||||||||||||||||
Deferred income taxes |
69,757 | 15,154 | 19,450 | ||||||||||||||||||
Accrued pension and severance costs |
66,945 | 67,596 | 72,435 | ||||||||||||||||||
Directors retirement allowance |
921 | 1,176 | 1,122 | ||||||||||||||||||
Other non-current liabilities |
347 | 341 | 340 | ||||||||||||||||||
Total non-current liabilities |
137,970 | 11.0 | 84,267 | 7.7 | 93,348 | 8.5 | |||||||||||||||
Total liabilities |
270,962 | 21.7 | 229,525 | 21.0 | 234,358 | 21.4 | |||||||||||||||
Stockholders equity |
|||||||||||||||||||||
Common stock |
115,703 | 9.2 | 115,703 | 10.5 | 115,703 | 10.5 | |||||||||||||||
Additional paid-in capital |
192,555 | 15.4 | 185,838 | 17.0 | 185,838 | 16.9 | |||||||||||||||
Retained earnings: |
|||||||||||||||||||||
Legal reserves |
17,207 | 17,206 | 17,206 | ||||||||||||||||||
Reserve for special depreciation |
2,392 | 3,148 | 3,148 | ||||||||||||||||||
Reserve for research and development |
1,000 | 1,000 | 1,000 | ||||||||||||||||||
Reserve for dividends |
1,000 | 1,000 | 1,000 | ||||||||||||||||||
Reserve for retirement benefits |
300 | 300 | 300 | ||||||||||||||||||
Reserve for overseas investments |
1,000 | 1,000 | 1,000 | ||||||||||||||||||
General reserve |
487,828 | 469,828 | 469,828 | ||||||||||||||||||
Unappropriated retained earnings |
22,712 | 29,421 | 16,339 | ||||||||||||||||||
Total retained earnings |
533,439 | 42.6 | 522,904 | 47.8 | 509,822 | 46.5 | |||||||||||||||
Net unrealized valuation gain on other securities |
170,104 | 13.6 | 92,735 | 8.5 | 103,099 | 9.4 | |||||||||||||||
Common stock in treasury, at cost |
(31,343 | ) | (2.5 | ) | (52,033 | ) | (4.8 | ) | (51,559 | ) | (4.7 | ) | |||||||||
Total stockholders equity |
980,458 | 78.3 | 865,147 | 79.0 | 862,904 | 78.6 | |||||||||||||||
Total liabilities and stockholders equity |
¥ | 1,251,420 | 100.0 | ¥ | 1,094,672 | 100.0 | ¥ | 1,097,263 | 100.0 | ||||||||||||
- 33 -
STATEMENTS OF INCOME
Yen in millions | ||||||||||||||||||||
Six months ended September 30, |
Increase (Decrease) |
Year ended March 31, | ||||||||||||||||||
2003 |
2002 |
2003 | ||||||||||||||||||
Amount |
% |
Amount |
% |
% |
Amount |
% | ||||||||||||||
Recurring profit and loss : |
||||||||||||||||||||
Operating income and expenses : |
||||||||||||||||||||
Net sales |
¥ | 237,808 | 100.0 | ¥ | 227,798 | 100.0 | 4.4 | ¥ | 482,834 | 100.0 | ||||||||||
Cost of sales |
187,351 | 78.8 | 180,896 | 79.4 | 3.6 | 374,225 | 77.5 | |||||||||||||
Selling, general and administrative expenses |
32,885 | 13.8 | 31,966 | 14.0 | 2.9 | 66,201 | 13.7 | |||||||||||||
Profit from operations |
17,572 | 7.4 | 14,936 | 6.6 | 17.6 | 42,407 | 8.8 | |||||||||||||
Non-operating income and expenses : |
||||||||||||||||||||
Non-operating income : |
||||||||||||||||||||
Interest and dividend income |
8,031 | 3.4 | 4,469 | 2.0 | 79.7 | 13,472 | 2.8 | |||||||||||||
Other non-operating income |
2,356 | 1.0 | 1,901 | 0.8 | 23.9 | 6,105 | 1.2 | |||||||||||||
Total non-operating income |
10,387 | 4.4 | 6,370 | 2.8 | 63.0 | 19,577 | 4.0 | |||||||||||||
Non-operating expenses : |
||||||||||||||||||||
Interest expense |
2 | 0.0 | 1 | 0.0 | 17.8 | 19 | 0.0 | |||||||||||||
Foreign currency transaction losses, net |
273 | 0.1 | 5,128 | 2.3 | (94.7 | ) | 4,650 | 1.0 | ||||||||||||
Other non-operating expenses |
1,508 | 0.7 | 1,220 | 0.5 | 23.6 | 2,631 | 0.5 | |||||||||||||
Total non-operating expenses |
1,783 | 0.8 | 6,350 | 2.8 | (71.9 | ) | 7,300 | 1.5 | ||||||||||||
Recurring profit |
26,176 | 11.0 | 14,956 | 6.6 | 75.0 | 54,685 | 11.3 | |||||||||||||
Non-recurring gain and loss : |
||||||||||||||||||||
Non-recurring gain |
204 | 0.1 | 6,311 | 2.7 | (96.8 | ) | 7,230 | 1.5 | ||||||||||||
Non-recurring loss |
506 | 0.2 | 6,636 | 2.9 | (92.4 | ) | 13,339 | 2.7 | ||||||||||||
Income before income taxes |
25,874 | 10.9 | 14,632 | 6.4 | 76.8 | 48,576 | 10.1 | |||||||||||||
Income taxes current |
7,820 | 3.3 | 5,440 | 2.4 | 43.7 | 13,046 | 2.7 | |||||||||||||
Income taxes deferred |
1,895 | 0.8 | (99 | ) | (0.1 | ) | | 7,605 | 1.6 | |||||||||||
Net income |
16,159 | 6.8 | 9,291 | 4.1 | 73.9 | 27,923 | 5.8 | |||||||||||||
Unappropriated retained earnings brought forward from the previous year |
6,553 | 7,048 | 7,048 | |||||||||||||||||
Net realized loss on treasury stock, at cost |
| 0 | 0 | |||||||||||||||||
Interim dividends |
| | 5,550 | |||||||||||||||||
Unappropriated retained earnings at end of period |
¥ | 22,712 | ¥ | 16,339 | ¥ | 29,421 | ||||||||||||||
- 34 -
1. Summary of significant accounting policies :
(1) Valuation of securities :
Held-to-maturity securities: Amortized cost method
Investments in subsidiaries and affiliates: Cost determined by the moving average method
Other securities
Marketable: |
Based on market price of the closing date of the interim financial period (Unrealized gains and losses on those securities are reported in the stockholders equity and cost is determined by the moving average method.) | |
Non-marketable : |
Cost determined by the moving average method |
(2) Valuation of derivatives instruments : Mark-to-market method
(3) Valuation of inventories :
Finished good, merchandise and work in process :
Finished goods and work in process are stated at the lower of cost or market, the cost being determined by the average method. Merchandise are stated at the lower of cost or market, the cost being determined by the last purchase method.
Raw materials and supplies :
Raw materials and supplies, except those for telecommunications equipment, are valued at the lower of cost or market, the cost being determined by the last purchase method.
Raw materials for telecommunications equipment are valued at the lower of cost or market, the cost being determined by the first-in, first-out method.
(4) Depreciation of fixed assets :
Tangible fixed assets :
Depreciation is computed at rates based on the estimated useful lives of assets using the declining balance method.
The principal estimated useful lives are as follows:
Building and structures |
2 to 25 years | |
Machinery and equipment, and Tools, furniture and fixtures |
2 to 10 years |
Intangible fixed assets :
Amortization is computed at rates based on the estimated useful lives of assets using the straight-line method.
(5) Accounting for allowance and accruals :
Allowances for doubtful accounts :
Allowances for doubtful accounts are provided at an estimated amount of the past actual ratio of losses on bad debts. Certain allowances are provided for estimated uncollectible receivables.
Allowances for impairment losses on securities :
Allowances for impairment losses on securities are provided at an estimated uncollectible amount of investments in subsidiaries or affiliates.
Accrued bonuses :
Accrued bonuses are provided based upon the amounts expected to be paid which is determined by actual payment of previous year.
Accrued pension and severance costs :
Pension and severance costs are recognized based on projected benefit obligation and plan assets at the year end.
Past service liability is amortized over estimated average remaining service period of employees (18 years) by using the straight-line method.
Actuarial gains or losses are amortized over estimated average remaining service period of employees (18 years) by using the straight-line method following the year incurred.
(6) Translation of assets and liabilities denominated in foreign currencies into Japanese yen :
Assets and liabilities denominated in foreign currencies are translated at the exchange rates in effect at the respective balance sheet dates, and resulting transaction gains or losses are included in the determination of net income.
(7) Lease transactions :
Finance lease other than those which are deemed to transfer the ownership of leased assets to lessees are accounted for by the method similar to that applicable to an ordinary operating lease.
(8) Consumption taxes are separately identified from each transaction.
- 35 -
2. Notes to the balance sheets :
Yen in millions | |||||||||
September 30, 2003 |
March 31, 2003 |
September 30, 2002 | |||||||
(1) Accumulated depreciation of tangible fixed assets |
¥ | 309,323 | ¥ | 312,256 | ¥ | 302,450 | |||
(2) Time deposit pledged as collateral |
¥ | 54,121 | ¥ | 56,368 | ¥ | 57,504 | |||
(3) Discounted trade notes receivable |
| ¥ | 16 | ¥ | 31 | ||||
(4) Guarantee |
¥ | 75,554 | ¥ | 22,844 | ¥ | 42,449 |
3. Notes to the statements of income :
(1) Major items in non-recurring gain and loss :
Yen in millions | |||||||||
Six months ended September 30, |
Year ended March 31, | ||||||||
2003 |
2002 |
2003 | |||||||
1) Non-recurring gain : |
|||||||||
Gain on disposal of tangible fixed assets |
¥ | 204 | ¥ | 148 | ¥ | 365 | |||
Reversal of allowance for doubtful accounts |
¥ | 0 | ¥ | 5,999 | ¥ | 6,651 | |||
2) Non-recurring loss : |
|||||||||
Loss on disposal of tangible fixed assets |
¥ | 472 | ¥ | 422 | ¥ | 1,205 | |||
Loss on devaluation of investment in securities |
¥ | 27 | ¥ | 194 | ¥ | 6,180 | |||
Provision for losses on investment in subsidiary |
| ¥ | 5,950 | ¥ | 5,950 | ||||
(2) Depreciation and amortization : |
Yen in millions | |||||||||
Six months ended September 30, |
Year ended March 31, | ||||||||
2003 |
2002 |
2003 | |||||||
Tangible fixed assets |
¥ | 11,911 | ¥ | 13,443 | ¥ | 28,357 | |||
Intangible assets |
¥ | 834 | ¥ | 1,056 | ¥ | 2,168 |
4. Note for marketable securities:
Market value for investment in subsidiaries and affiliates:
Yen in millions | |||||||||
Carrying Amount |
Market value |
Difference | |||||||
Investment in subsidiaries |
¥ | 57,174 | ¥ | 176,929 | ¥ | 119,755 | |||
Investment in affiliates |
¥ | 6,541 | ¥ | 21,322 | ¥ | 14,781 |
- 36 -
To whom it may concern:
Name of Company listed: |
Kyocera Corporation |
Name of Representative: |
Yasuo Nishiguchi |
President and Director |
(Code number: 6971, |
The First Section of the Tokyo Stock Exchange, |
The First Section of the Osaka Securities Exchange) |
Person for Inquiry: Hideki Ishida |
Managing Executive Officer |
General Manager of Corporate Finance Division |
(Tel. No.: 075-604-3500) |
Notice relating to Restructuring of
Crystal Components Related Businesses of Kyocera Group
Kyocera Corporation (the Company) will restructure its crystal components related business by means of corporate splits undertaken with Kinseki, Limited (Kinseki), as announced on September 19, 2003. This is to advise you that the agreement for corporate split was approved at the Companys Board of Directors Meeting on October 28, 2003, as described below.
[Objective of the Corporate Split]
In August 2003, the Company made Kinseki a wholly-owned subsidiary by means of a stock swap, and established a corporate structure under which the Company is able to fully support the management of Kinseki. To enhance the synergetic effects resulting therefrom, and to further boost the crystal components related business of Kyocera Group, it has been decided that Kinsekis marketing division shall be consolidated into the marketing division of the electronic components business of the Company, and the manufacturing division of the crystal components related business of the Company shall be transferred to Kinseki.
I. Separation of Marketing Division
1. Outline of Corporate Split
(1) Schedule of Corporate Split
Meeting of Board of Directors to approve agreement for corporate split: |
October 28, 2003 | |
Execution of agreement for corporate split: | October 28, 2003 | |
General Shareholders Meeting to approve agreement for corporate split: | The Company will not obtain approval at its General Shareholders Meeting for the corporate split in accordance with Article 374-23 (Easy Method for Corporate Split) of the Commercial Code, while Kinseki will hold a General Shareholders Meeting on November 12, 2003 (scheduled) to approve the agreement for corporate split. | |
Effective date of corporate split: | April 1, 2004 (scheduled) | |
Register of corporate split in Commercial Register: | April 1, 2004 (scheduled) |
(2) Method of Corporate Split
(i) | Method of Corporate Split |
Dividing and succeeding corporate split, in which the Company shall be the succeeding company and Kinseki, a wholly-owned subsidiary of the Company, shall be the divided company.
(ii) | Reason for Choosing Method |
It has been decided that a dividing and succeeding corporate split is the most suitable option for the Company to succeed to the marketing division of Kinseki, which is a wholly-owned subsidiary of the Company.
(3) Allocation of Shares
There will be no allocation of shares of the Company, as Kinseki is a wholly-owned subsidiary of the Company and as the relevant corporate split adopts the dividing method.
(4) Amount of Capital Increase as a Result of Corporate Split, etc.
The amount of the Companys voluntary reserve will increase in an amount equivalent to the total amount of assets to which it will succeed from Kinseki in the corporate split.
(5) Cash to be Delivered
No cash shall be delivered in the corporate split.
(6) Rights and Obligations to be Succeeded to by the Succeeding Company (the Company)
The Company will succeed to assets and rights and obligations pursuant to agreements belonging to Kinsekis marketing division as of the effective date of the corporate split.
(7) Expectations with Respect to Performance of Debts
(i) | Divided Company (Kinseki) |
Taking into consideration the amounts of assets, liabilities and net asset value of Kinseki, it is judged that there will be no problem with respect to the certainty of performance by Kinseki of its debts.
(ii) | Succeeding Company (the Company) |
Taking into consideration the amounts of assets, liabilities and net asset value of the Company and the amount of assets, etc. to which the Company will succeed, it is judged that there will be no problem with respect to the certainty of performance by the Company of its debts.
(8) New Directors or Corporate Auditors of the Succeeding Company who Currently Work for the Divided Company (Kinseki)
None.
2. Content of Business to be Succeeded
(1) | Content of Business of the Marketing Division of the Crystal Components Related Business: Marketing division of crystal components |
(2) | Performance of the Marketing Division of the Crystal Components Related Business of Kinseki for the Fiscal Year ended March 31, 2003 |
(Yen in millions)
Marketing Division of Crystal Components Related Business (a) |
The Companys performance for the year ended March 31, 2003 (b) |
Percentage (a/b) |
||||||
Net Sales |
27,640 | 482,834 | 5.7 | % | ||||
Gross Profit |
1,838 | 108,609 | 1.7 | % | ||||
Profit from Operations |
(658 | ) | 42,407 | | ||||
Recurring Profit |
(432 | ) | 54,685 | |
(3) Assets and Liabilities to be Transferred and Amounts thereof (as of September 30, 2003)
(Yen in millions)
Assets |
Liabilities | |||||
Item |
Book Value |
Item |
Book Value | |||
Current Assts |
0 | Current Liabilities | 0 | |||
Fixed Assets |
17 | Fixed Liabilities | 0 | |||
Other Investments, etc. |
0 | |||||
Total |
17 | Total | 0 |
II. Separation of Manufacturing Division
1. Outline of Corporate Split
(1) Schedule of Corporate Split
Meeting of Board of Directors to approve agreement for corporate split: | October 28, 2003 | |
Execution of agreement for corporate split: | October 28, 2003 | |
General Shareholders Meeting to approve agreement for corporate sprit: | Both the Company and Kinseki will undertake the corporate split without approval of their respective General Shareholders Meetings in accordance with Articles 374-22 and 374-23 (Easy Method for Corporate Split), respectively. | |
Effective date of corporate split: | April 1, 2004 (scheduled) | |
Register of corporate split in Commercial Register: | April 1, 2004 (scheduled) |
(2) Method of Corporate Split
(i) | Method of Corporate Split |
Dividing and succeeding corporate split, in which the Company will be the divided company and Kinseki, a wholly-owned subsidiary of the Company, will be the succeeding company.
(ii) | Reason for Choosing Method |
It has been decided that a dividing and succeeding corporate split is the most suitable option for consolidation of the manufacturing division of the Companys crystal components related business with Kinseki, a wholly-owned subsidiary of the Company, in which the shares issued by Kinseki shall be allocated to the Company.
(3) Allocation of Shares
(i) | Allocation Ratio of Shares |
One share to be issued by Kinseki in the corporate split shall be allocated to the Company.
(ii) | The Basis of Calculation of Allocation Ratio |
Kinseki is a wholly-owned subsidiary of the Company and, as a result, all shares to be issued in the corporate split (using the dividing and succeeding corporate split method) will be allocated to the Company. Accordingly, the Company will succeed to all assets and liabilities of Kinseki at their book value. As a result of the corporate split, there will be no change in the Companys net asset value regardless of the number of shares to be allocated by Kinseki to the Company because the amount of the difference between assets and liabilities of Kinseki to which the Company will succeed will be equivalent to the amount of increase in the amount of Companys investments in subsidiaries. In the light of the above, the Company and Kinseki have discussed and determined that the one share of Kinseki shall be issued and allocated to the Company.
(4) Cash to be Delivered
No cash shall be delivered in the corporate split.
(5) Rights and Obligations to be Succeeded to by the Succeeding Company (Kinseki)
Kinseki will succeed to assets and liabilities and rights and obligations belonging to the manufacturing division of the Companys crystal parts related business pursuant to agreements as of the effective date of the corporate split.
(6) Expectations with Respect to Performance of Debts
(i) | Divided Company (the Company) |
Taking into consideration the amounts of assets, liabilities and net asset value of the Company, it is judged that there will be no problem with respect to the certainty of performance by the Company of its debts.
(ii) | Succeeding Company (Kinseki) |
Taking into consideration the amounts of the assets, liabilities and net asset value of Kinseki and the amounts of assets, liabilities and net asset value, etc. to which Kinseki will succeed, it is judged that there will be no problem with respect to the certainty of performance by Kinseki of its debts.
(7) New Directors or Corporate Auditors of the Succeeding Company (Kinseki)
Not yet decided.
2. Content of Business to be Divided
(1) | Content of the Manufacturing Division of the Crystal Components Related Business: |
Development and manufacturing division of crystal components
(2) | Performance of the Manufacturing Division of the Crystal Components related Business of the Company for the fiscal year ended March 31, 2003: |
Net sales of the Company derived from its crystal components related business for the fiscal year ended March 31, 2003 were approximately 15 billion yen, representing approximately 3% of the total net sales of the Company in the amount of 482,834 million yen for the same period.
(3) | Assets and Liabilities to be Transferred and Amounts thereof (as of September 30, 2003): |
(Yen in millions)
Assets |
Liabilities | |||||
Item |
Book Value |
Item |
Book Value | |||
Current Assets |
1,887 | Current Liabilities | 1,946 | |||
Fixed Assets |
1,847 | Fixed Liabilities | 0 | |||
Other Investments, etc. |
891 | |||||
Total |
4,625 | Total | 1,946 |
* | As of September 30, 2003, the amount of assets to be succeeded (4,625 million yen) represented 0.37% of the total asset value of the Company (1,251,420 million yen) as of the same date. |
III. Status of the Company after Corporate Splits
1. | There will be no change in the corporate name, content of businesses, location of headquarters, names of representatives, amount of capital or fiscal year end, in connection with the corporate split. |
2. | Total Assets |
As a result of the corporate splits, there will be an increase in the amount of the Companys assets in an amount equivalent to the amount of assets to which the marketing division of the Company will succeed from Kinseki and a decrease in the amount of the Companys assets in an amount equivalent to the amount of liabilities to be assumed by Kinseki with the Companys manufacturing division.
3. | Impact on Companys Performance |
The effective date of the corporate split will be April 1, 2004, and accordingly, there will be no impact from the corporate split on the forecasted performance of the Company for the fiscal year ending March 31, 2004.
IV. Outlines of Parties to the Corporate Split (as of September 30, 2003)
(1) Name | Kyocera Corporation | Kinseki, Limited | ||
(2) Principal Businesses | Fine Ceramics Group Electronic Device Group Equipment Group Others |
Electronic components, consisting mainly of artificial crystal related products | ||
(3) Date of Incorporation | April, 1959 | August, 1950 | ||
(4) Location of Headquarters | Fushimi-ku, Kyoto | Komae-shi, Tokyo | ||
(5) Representatives | Yasuo Nishiguchi President and Director |
Isao Kishimoto President and Director | ||
(6) Capital Amount | 115,703 million yen | 16,317 million yen | ||
(7) Number of Shares Issued and Outstanding | 191,309,290 shares (out of which 3,822,655 shares are treasury stock) |
35,172,042 shares | ||
(8) Shareholders Equity | 980,458 million yen | 37,775 million yen | ||
(9) Total Assets | 1,251,420 million yen | 51,737 million yen | ||
(10) Fiscal Year End | March 31 | March 31 | ||
(11) Number of Employees | 13,678 | 178 | ||
(12) Principal Suppliers and Customers | Suppliers: | Suppliers: | ||
Matsushita Electric Industrial Co., Ltd. Mitsui & Co., Ltd. Sony Corp. |
Kyocera Corp. Toyo Dempa Co., Ltd. Asahi Kasei Microsystems, Co., Ltd. | |||
Customers: | Customers: | |||
Fujitsu Ltd. Hitachi, Ltd. NEC Corp. |
Matsushita Electric Industrial Co., Ltd. Sony Corp. Toshiba Corp. Hitachi, Ltd. |
(13) Principal Shareholders and Their Shareholding Ratios | Japan Trustee Services Bank, Ltd. (Trust Account) 8.61% The Master Trust Bank of Japan, Ltd. (Trust Account) 4.57% The Bank of Kyoto, Ltd. 3.77% Kazuo Inamori 3.56% UFJ Trust Bank, Ltd. 2.95% |
Kyocera Corp. 100.00% | ||
(14) Principal Banks | The Bank of Kyoto, Ltd. UFJ Bank Ltd. |
Mizuho Corporate Bank, Ltd. Sumitomo Mitsui Banking Corp | ||
(15) Relationship between the Parties | Capital Relationship | Kinseki is a wholly-owned subsidiary of the Company. | ||
Personnel Relationship | The Company forwards Directors and Corporate Auditors to Kinseki. It also seconds employees to Kinseki. | |||
Trades between the Parties | Manufacture, marketing and development of crystal parts. |
(16) Performance in Most Recent Three Fiscal Years
(Yen in millions, except per share amounts)
Kyocera Corporation (100% parent company) |
Kinseki, Limited (wholly-owned subsidiary) |
|||||||||||||
Fiscal Year |
Ended March 31, 2001 |
Ended March 31, 2002 |
Ended March 31, 2003 |
Ended March 31, 2001 |
Ended March 31, 2002 |
Ended March 31, 2003 |
||||||||
Net Sales |
652,510 | 499,264 | 482,834 | 35,743 | 22,318 | 27,640 | ||||||||
Recurring Profit (or Loss) |
114,500 | 56,412 | 54,685 | 4,020 | (2,992 | ) | (432 | ) | ||||||
Net Income |
31,398 | 34,475 | 27,923 | 2,351 | (5,950 | ) | (1,260 | ) | ||||||
Net Income per Share |
164.98 yen | 182.36 yen | 149.45 yen | 67.58 yen | (169.21) yen | (35.87) yen | ||||||||
Dividend per Share |
60.00 yen | 60.00 yen | 60.00 yen | 10.00 yen | 3.00 yen | 3.00 yen | ||||||||
Shareholders Equity per Share |
4,675.06 yen | 4,652.07 yen | 4,676.97 yen | 1,308.39 yen | 1,123.44 yen | 1,085.69 yen |