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 June, 2004
Commission File Number 2 - 68279
RICOH COMPANY, LTD.
-----------------------------------------------
(Translation of Registrant's name into English)
15-5, Minami-Aoyama 1-Chome, Minato-ku, Tokyo 107-8544, Japan
-------------------------------------------------------------
(Address of Principal Executive Offices)
(Indicate by check mark whether the registrant files or will file annual reports
under cover Form 20-F or Form 40-F.)
Form 20-F X Form 40-F __
(Indicate by check mark if the registrant is submitting the Form 6-K in paper as
permitted by Regulation S-T Rule 101(b)(1): __ )
(Indicate by check mark if the registrant is submitting the Form 6-K in paper as
permitted by Regulation S-T Rule 101(b)(7): __ )
(Indicate by check mark whether by furnishing the information contained in this
Form, the registrant is also thereby furnishing the information to the
Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act
of 1934.)
Yes __ No X
(If "Yes" is marked, indicate below the file number assigned to the registrant
in connection with Rule 12g3-2(b): 82-__ )
--------------------------------------------------------------------------------
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
Ricoh Company, Ltd.
------------------------------
(Registrant)
By: /S/ Etsuo Kobayashi
------------------------------
Etsuo Kobayashi
Executive Vice President
General Manager of
Personnel Division
June 7, 2004
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(TRANSLATION)
June 4, 2004
NOTICE OF
104th ORDINARY GENERAL MEETING OF SHAREHOLDERS
Dear Shareholder,
The Company would hereby like to inform you that the 104th ordinary general
meeting of shareholders will be held as follows, and would be grateful if you
could attend the meeting.
Those who will not be able to attend the meeting on the day are kindly requested
to consider appended "Reference Material for Exercising Voting Rights" and
indicate on the voting form enclosed herewith your approval or disapproval of
the matters to be resolved, and return the form bearing your registered seal or
signature to us. Your voting right can also be exercised via the Internet
(http://www.web54.net). Please submit your voting right no later than Thursday,
June 24, 2004.
Yours faithfully,
Masamitsu Sakurai, President
Ricoh Company, Ltd.
1-3-6 Nakamagome, Ohta-ku, Tokyo
1. DATE AND TIME: Friday, June 25, 2004, from 10:00 a.m.
2. VENUE: Ricoh's registered head office:
1-3-6 Nakamagome, Ohta-ku, Tokyo
3. MEETING AGENDA:
ITEM TO BE REPORTED The Balance Sheets as of March 31, 2004, the Statements
of Income and the Business Report for the fiscal year
ended March 31, 2004 (April 1, 2003 to March 31, 2004).
ITEMS TO BE RESOLVED
Agenda 1: Approval of the proposed appropriation of retained
earnings for the fiscal year
Agenda 2: Partial amendment to the Articles of Incorporation
Please see appended "Reference Material for Exercising
Voting Rights" (page 26)
Agenda 3: Election of fourteen (14) directors
Agenda 4: Election of three (3) corporate auditors
Agenda 5: Granting of retirement allowances to retiring directors
--------------------------------------------------------------------------------
Shareholders are requested to fill out and submit the appended voting form at
the reception desk on the above-mentioned date.
* This English translation is an abridged version of the original notice in
Japanese. In the event of any discrepancy, the Japanese version shall prevail.
-1-
Reference Documents Attached to Notice of 104/th/ Ordinary General Meeting of
Shareholders
BUSINESS REPORT
(APRIL 1, 2003, TO MARCH 31, 2004)
1. OPERATING CONDITIONS
(1) OPERATING PROGRESS AND RESULTS
(a) Overview
In the fiscal year ended March 31, 2004, the Japanese economy showed some
positive signs of recovery, such as an improvement in corporate earnings and a
steady increase in capital investment. In the U.S., economic recovery was seen
in the latter half of the period, driven by the expansion of consumer spending
and capital investment due to tax cuts and other factors, while the European
economy was generally stagnant. Chinese economy maintained high growth rate
driven by expanding domestic consumer spending and increased exports.
Under such circumstances, the Ricoh Group proactively proceeds with
business activities based on the "14/th/ Medium-term Management Plan",
established for the period from April 2002 through March 2005.
In the office equipment business, one of the Ricoh Group's core segment,
the Company has been pursuing the "transition from mere manufacturing and
marketing of such equipment as copiers and printers to the solution business to
support the customers' business improvement and business innovation through the
supply of equipment".
We foresee that the customers' requirements to improve and innovate their
business will further proliferate. Concurrently, with installation of digital
networks further prevailing and customer needs for larger volumes of electronic
and color processing of information ever increasing, it will become important
issue for the customers to efficiently and effectively manage the input/output,
storage and retrieval of TDV (total document volume), comprising of not only
copying but also printing functions.
Having recognized this trend, we have set the main strategy for the 14/th/
Medium-term Management Plan as "the expansion of our revenue base by meeting
customer needs for TDV". The key elements of the strategy and respective aims
are as follows.
(i) B to C (Black and white to Color) Transition:
To provide a full line of color products, which are comparable to
monochrome models in machine price and are made of space-saving design,
and which not only satisfy the customers' needs for replacing monochrome
machines but also create new demand for color machines.
(ii) Increasing sales of high-speed machines:
To provide high-speed machines which are competitive in terms of unit
price, maintenance cost and reliability, thereby satisfying the customer
needs for effective output capability.
(iii) Providing full printing solutions:
To offer best combination of copiers and printers to satisfy the customer
needs to further reduce their costs.
-2-
The results attained in the fiscal period under review based on these basic
strategies are as follows.
Responding to the B to C Transition, we launched new models of color
multi-feature machines and color laser printers one after another to reinforce
the product line-up. As a result, we could largely increase the market share in
the U.S. and Europe. Also, we started the marketing of new color inkjet printer
IPSiO G707/G505, incorporating GELJET technology exclusively developed by Ricoh,
in an attempt to create a market for business-use ink-jet printers.
As a result of our efforts to increase sales of high-speed machines,
high-speed digital multi-function machines continued to do very well in both the
domestic and overseas markets to establish our steady position in the market.
In the printing solutions sector, we are steadily increasing the sales to
major customers, who are doing business on a global scale, especially in the
U.S. and European markets due to our proposition for minimizing total expenses
through optimal combination of copiers and printers as well as our worldwide
service and support networks.
With respect to the technical strategy, we are striving for the
reinforcement of technical capabilities aiming to become the "world's No.1
product-engineering company" capable of supplying competitive products and
services. In particular, we are concentrating our efforts on such technical
areas as: the development of next-generation high-speed color image processing
equipment; development of system engineering to enable easy inter-connection and
operation of various types of office equipment, and; the development of highly
sustainable products.
As one achievement of these efforts, we launched the imagio Neo 752/602
Series high-speed digital multi-function machines, which boast both high
"operability" and low "energy consumption" and embody environment friendliness
without sacrificing high productivity essential to high-speed machines.
Meanwhile, as a part of our efforts to enhance corporate governance, we
established Ricoh Group CSR (Corporate Social Responsibility) Charter and Ricoh
Group Code of Conduct in order to renew our awareness for the importance of
recognizing and observing the respective laws and regulations of each respective
nation, international laws and the spirit thereof, so as to take socially
sensible and responsible courses of action.
With respect to the disclosure of corporate information, we enforced an
internal rule regarding the process for gathering, producing, reporting and
disclosing information. For the implementation of the rule, we established the
Disclosure Committee to ensure the strict, timely and complete disclosure of
corporate information.
In the fiscal year under review, net sales increased to Yen 876.3 billion,
up 2.5% from the previous fiscal year. Operating income fell to Yen 62.1
billion, down 13.5% from the previous fiscal year due to increased selling,
general and administrative expenses (such as research and development costs)
with ordinary income dropping to Yen 62.5 billion, down 9.3% from the previous
fiscal year. Net income in the fiscal year rose to Yen 58.5 billion, up 36.6%
from the previous fiscal year as we booked an extraordinary profit associated
with the return of substitute portion of Employees' Pension Fund to the
government, etc.
-3-
(b) Segment performance
Sales by category
(Billions of yen)
----------------------------------------------------------------------------------------------------------
Category Sales Percentage of total Change (%)
----------------------------------------------------------------------------------------------------------
Imaging Solutions 470.9 53.7 -0.8
----------------------------------------------------------------------------------------------------------
Network Input/Output Systems 259.4 29.6 9.2
----------------------------------------------------------------------------------------------------------
Network System Solutions 91.6 10.5 2.2
----------------------------------------------------------------------------------------------------------
Office Equipment Total 822.0 93.8 2.5
----------------------------------------------------------------------------------------------------------
Other Businesses 54.3 6.2 3.1
----------------------------------------------------------------------------------------------------------
Total 876.3 100.0 2.5
----------------------------------------------------------------------------------------------------------
Domestic 486.1 55.5 0.4
----------------------------------------------------------------------------------------------------------
Exports 390.1 44.5 5.2
----------------------------------------------------------------------------------------------------------
(2) PLANT AND EQUIPMENT INVESTMENT
In the fiscal year under review, we invested a total of Yen 24.3 billion in
plant and equipment, mainly comprising of the following.
(a) Major equipment and facility expansions completed during the fiscal year:
Electronic components plant (Yashiro Plant)
Related supplies plant (Numazu Plant)
Logistics center facilities (Gotenba Plant and Numazu Plant)
(b) Major equipment and facility expansions in progress in the fiscal year:
Electronic components plant (Yashiro Plant)
Related supplies plant (Numazu Plant)
Logistics center facilities (Gotenba Plant and Numazu Plant)
(3) FUNDING
During the fiscal year under review, Ricoh did not seek increased capitalization
or financing through any corporate bond or other issues.
(4) TRANSITION OF OPERATING RESULT
(Billions of yen; except for net income per share)
-----------------------------------------------------------------------------------------------------------
Items Fiscal year ended Fiscal year ended Fiscal year ended Fiscal year ended
March 31, 2001 March 31, 2002 March 31, 2003 March 31, 2004
-----------------------------------------------------------------------------------------------------------
Net sales 855.4 860.1 855.0 876.3
-----------------------------------------------------------------------------------------------------------
Ordinary income 65.9 67.6 68.8 62.5
-----------------------------------------------------------------------------------------------------------
Net income 34.4 40.0 42.8 58.5
-----------------------------------------------------------------------------------------------------------
Net income per share (yen) 49.67 57.42 58.75 79.18
-----------------------------------------------------------------------------------------------------------
Total assets 824.1 908.0 933.3 937.3
-----------------------------------------------------------------------------------------------------------
Shareholders' equity 489.1 553.6 596.6 642.4
-----------------------------------------------------------------------------------------------------------
Notes:
1. Net income per share is based on the average number of shares of
outstanding common stock during the fiscal year.
2. Since fiscal year ended March 2002, net income per share has been
calculated after deducting the number of shares of treasury stock from the
average number of shares of outstanding common stock.
3. Since fiscal year ended March 2003, the Company has been applying
"Accounting Standards for Net Income per Share" (Corporate Accounting
Standard No.2) and "Policies Applied to Accounting Standards Related to Net
Income per Share" (Corporate Accounting Standard Application Policy No.4)
in the calculation of net income per share.
-4-
2. CORPORATE PROFILE (as of March 31, 2004)
(1) PRINCIPAL SALES OFFICES AND PLANTS
(a) Head office: 1-3-6, Nakamagome, Ohta-ku, Tokyo
(b) Sales offices
--------------------------------------------------------------------------------
Name Location
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Principal Executive Office Headquarters Minato-ku, Tokyo
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Ginza Office Chuo-ku, Tokyo
--------------------------------------------------------------------------------
Shinyokohama Office Yokohama, Kanagawa
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Sapporo Branch Sapporo, Hokkaido
--------------------------------------------------------------------------------
Sendai Branch Sendai, Miyagi
--------------------------------------------------------------------------------
Kanto Branch Chuo-ku, Tokyo
--------------------------------------------------------------------------------
Tokyo Branch Chuo-ku, Tokyo
--------------------------------------------------------------------------------
Nagoya Branch Nagoya, Aichi
--------------------------------------------------------------------------------
Osaka Branch Osaka, Osaka
--------------------------------------------------------------------------------
Hiroshima Branch Hiroshima, Hiroshima
--------------------------------------------------------------------------------
Fukuoka Branch Fukuoka, Fukuoka
--------------------------------------------------------------------------------
(c) Laboratories and plants
--------------------------------------------------------------------------------
Name Location
--------------------------------------------------------------------------------
Research and Development Center Yokohama, Kanagawa
--------------------------------------------------------------------------------
Software Research Center Bunkyo-ku, Tokyo
--------------------------------------------------------------------------------
Applied Electronics Institute Natori, Miyagi
--------------------------------------------------------------------------------
Ohmori Office Ohta-ku, Tokyo
--------------------------------------------------------------------------------
Ohmori Office 2 Ohta-ku, Tokyo
--------------------------------------------------------------------------------
Atsugi Plant Atsugi, Kanagawa
--------------------------------------------------------------------------------
Hatano Plant Hatano, Kanagawa
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Gotemba Plant Gotemba, Shizuoka
--------------------------------------------------------------------------------
Numazu Plant Numazu, Shizuoka
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Fukui Plant Sakai-gun, Fukui
--------------------------------------------------------------------------------
Ikeda Plant Ikeda, Osaka
--------------------------------------------------------------------------------
Yashiro Plant Kato-gun, Hyogo
--------------------------------------------------------------------------------
-5-
(2) SHAREHOLDERS' EQUITY
(a) Total number of shares
Authorized: 993,000,000
Issued: 744,912,078
(b) Number of shareholders at year-end: 45,167
(c) Major shareholders
------------------------------------------------------------------------------------------------------------
Name The shareholders' stake in The Company's stake in the
the Company shareholders
------------------------------------------------------------------------------------------------------------
Thousands of Percentage Thousands of Percentage
shares of voting shares of voting
rights rights
------------------------------------------------------------------------------------------------------------
Master Trust Bank of Japan, Ltd. (Trust 85,575 11.68 - -
Account)
------------------------------------------------------------------------------------------------------------
Japan Trustee Services Bank, Ltd. (Trust 73,282 10.00 - -
account)
------------------------------------------------------------------------------------------------------------
Nippon Life Insurance Company 31,709 4.33 - -
------------------------------------------------------------------------------------------------------------
The Chase Manhattan Bank N.A. London 26,952 3.68 - -
------------------------------------------------------------------------------------------------------------
UFJ Bank Ltd. 24,413 3.33 - -
------------------------------------------------------------------------------------------------------------
The Chase Manhattan Bank N.A. London S.L. 20,134 2.74 - -
Omnibus Account
------------------------------------------------------------------------------------------------------------
State Street Bank and Trust Company 19,118 2.61 - -
------------------------------------------------------------------------------------------------------------
Nipponkoa Insurance Co., Ltd. 19,015 2.59 55 0.01
------------------------------------------------------------------------------------------------------------
The Bank of Tokyo-Mitsubishi, Ltd. 16,028 2.18 - -
------------------------------------------------------------------------------------------------------------
The New Technology Development Foundation 15,636 2.13 - -
------------------------------------------------------------------------------------------------------------
Note:
In addition to the above, stakes in the Company include 1,000,000 shares (0.13%)
that Nipponkoa Insurance Co., Ltd. owns and has entrusted with Master Trust Bank
of Japan, Ltd. These shares are registered in the name of Masters Trust Bank of
Japan, Ltd. as the owner, but Nipponkoa Insurance Co., Ltd. reserves the right
to instruct on exercising voting rights on these shares.
(d) Acquisition, disposal and ownership of shares of treasury stock
(i) Treasury stocks acquired:
Number of shares of common stock 5,960,150 shares
Total acquisition cost Yen 11,823 million
(ii) Treasury stocks disposed of:
Number of treasury shares of common stock 2,246,406 shares
Total gain through the disposition Yen 4,277 million
(iii) Number of treasury stocks at year-end:
Number of treasury shares of common stock 6,017,187 shares
(3) EMPLOYEES
-------------------------------------------------------------------------------------------------------
Gender Number of Change from Average length of
employees previous fiscal year Average age service
-------------------------------------------------------------------------------------------------------
Male 9,971 -458 41.5 17.6
-------------------------------------------------------------------------------------------------------
Female 1,593 -63 34.1 12.6
-------------------------------------------------------------------------------------------------------
Total 11,564 -521 40.5 16.9
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-6-
(4) DIRECTORS AND CORPORATE AUDITORS
------------------------------------------------------------------------------------------------------------
Position or principal duty Name
------------------------------------------------------------------------------------------------------------
Chairman and Hiroshi Hamada
Representative Director
------------------------------------------------------------------------------------------------------------
President and Masamitsu Sakurai
Representative Director
------------------------------------------------------------------------------------------------------------
Deputy President and Environment, Social Contribution, Public Relations Haruo Kamimoto
Representative Director
------------------------------------------------------------------------------------------------------------
Deputy President and Accounting, Personnel Tatsuo Hirakawa
Representative Director
------------------------------------------------------------------------------------------------------------
Executive Managing Corporate Planning, IR, Corporate Communications, Koichi Endo
Director SCM Structural Reform, Information Technology and
Solutions
------------------------------------------------------------------------------------------------------------
Executive Managing Domestic Marketing Masayuki Matsumoto
Director
------------------------------------------------------------------------------------------------------------
Managing Director CS and Quality, Production, Materials Procurement; Makoto Hashimoto
General Manager of Management Quality Control
Division
------------------------------------------------------------------------------------------------------------
Managing Director Overseas Marketing; General Manager of International Katsumi Yoshida
Marketing Group
------------------------------------------------------------------------------------------------------------
Managing Director Research And Development; General Manager of Kiyoshi Sakai
Research and Development Division, Head of Group
Technology Planning Office
------------------------------------------------------------------------------------------------------------
Managing Director Image System Business, Planning, Development and
Engineering of Image Systems; General Manager of Shiro Kondoh
Image System Group
------------------------------------------------------------------------------------------------------------
Managing Director Sales in Europe Kazuo Togashi
------------------------------------------------------------------------------------------------------------
Managing Director Domestic Marketing Planning; General Manager of Kazunori Azuma
Marketing Group, Head of Solution Marketing Center
------------------------------------------------------------------------------------------------------------
Director Comprehensive Business Administration Josei Itoh
Director Chairman and Representative Director of
NIppon Life Insurance Company
------------------------------------------------------------------------------------------------------------
Director Information Communication Business and Technological Nobuo Mii
Matters
Managing Partner of Ignite Group
------------------------------------------------------------------------------------------------------------
Corporate Auditor (Full-time) Hisaaki Koga
------------------------------------------------------------------------------------------------------------
Corporate Auditor (Full-time) Hideyuki Takamatsu
------------------------------------------------------------------------------------------------------------
Corporate Auditor President of Matsuishi Law office Kenji Matsuishi
------------------------------------------------------------------------------------------------------------
Corporate Auditor President and Representative Director of Sanai-oil Takehiko Wada
Co., Ltd.
------------------------------------------------------------------------------------------------------------
Notes:
1. Changes of directors took place in the fiscal year under review as follows:
June 2003; Shiro Kondoh, Kazuo Togashi and Kazunori Azuma were appointed as
managing directors. September 2003; Masami Takeiri retired from Executive
Managing Director. March 2004; Naoto Shibata retired from Executive
Managing Director.
2. Directors Josei Itoh and Nobuo Mii are outside directors appointed under
Article 188-2-7-2 of the Commercial Code.
3. Corporate Auditors Kenji Matsuishi and Takehiko Wada are outside corporate
auditors as stipulated in Clause 1, Article 18 of the Law for Special
Exceptions to the Commercial Code concerning Audit, etc. of Kabushiki
Kaisha.
-7-
(5) STATUS OF CONSOLIDATION
(a) Major Consolidated Subsidiaries
-----------------------------------------------------------------------------------------------------------
Percentage of
Name Paid-in capital total voting rights Principal business
-----------------------------------------------------------------------------------------------------------
Tohoku Ricoh Co., Ltd. 2,272 million JPY 100.00 Manufacture of copiers and IT
equipment
-----------------------------------------------------------------------------------------------------------
Ricoh Elemex Corporation 3,456 million JPY 55.74 Manufacture of copiers and IT
equipment
-----------------------------------------------------------------------------------------------------------
NBS Ricoh Co., Ltd. 50 million JPY 100.00 Marketing of office supplies
-----------------------------------------------------------------------------------------------------------
Tokyo Ricoh Co., Ltd. 418 million JPY 100.00 Marketing of copiers and IT
equipment
-----------------------------------------------------------------------------------------------------------
Osaka Ricoh Co., Ltd. 210 million JPY 100.00 Marketing of copiers and IT
equipment
-----------------------------------------------------------------------------------------------------------
Marketing of IT equipment and
Ricoh Technosystems Co., 1,000 million JPY 100.00 maintenance of copiers and IT
Ltd. equipment
-----------------------------------------------------------------------------------------------------------
Ricoh Chubu Co., Ltd. 400 million JPY 100.00 Marketing of copiers and IT
equipment
-----------------------------------------------------------------------------------------------------------
Ricoh Kansai Co., Ltd. 700 million JPY 100.00 Marketing of copiers and IT
equipment
-----------------------------------------------------------------------------------------------------------
Ricoh Leasing Co., Ltd. 7,896 million JPY 51.11 General leasing
-----------------------------------------------------------------------------------------------------------
Manufacture of copiers and IT
RICOH ASIA INDUSTRY 27 million USD 100.00 equipment; and manufacture of
(SHENZHEN) LTD. office supplies
-----------------------------------------------------------------------------------------------------------
RICOH ASIA INDUSTRY LTD. 180 million HKD 90.00 Marketing of copiers and IT
equipment
-----------------------------------------------------------------------------------------------------------
Manufacture of copiers and IT
RICOH ELECTRONICS, INC. 27 million USD 100.00 equipment; and manufacture and
marketing of office supplies
-----------------------------------------------------------------------------------------------------------
RICOH CORPORATION 192 million USD 100.00 Marketing of copiers and IT
equipment
-----------------------------------------------------------------------------------------------------------
LANIER WORLDWIDE, INC. 256 million USD 100.00 Marketing of copiers and IT
equipment
-----------------------------------------------------------------------------------------------------------
RICOH EUROPE B.V. 13 million EUR 100.00 Marketing of copiers and IT
equipment
-----------------------------------------------------------------------------------------------------------
RICOH FRANCE S.A. 1 million EUR 100.00 Marketing of copiers and IT
equipment
-----------------------------------------------------------------------------------------------------------
NRG GROUP PLC 49 million GBP 100.00 Marketing of copiers and IT
equipment
-----------------------------------------------------------------------------------------------------------
Note: The respective percentages of total voting rights for Ricoh Elemex
Corporation, Osaka Ricoh Co., Ltd., Ricoh Leasing Co., Ltd., Ricoh Asia Industry
(Shenzhen) Ltd., Ricoh Electronics, Inc., and Lanier Worldwide, Inc., include
voting rights of those shares held by subsidiaries.
(b) Consolidations
Tohoku Ricoh Co., Ltd. became a wholly owned subsidiary on April 1, 2003,
through a stock for stock exchange.
-8-
(c) Results of consolidation
In the fiscal year under review, Ricoh Group has 321 consolidated subsidiaries
and 60 affiliates accounted for under the equity method. Results of
consolidation were as follows.
(Billions of yen; except for net income per share)
---------------------------------------------------------------------------------------------------------
Items Fiscal year ended Fiscal year ended Fiscal year ended Fiscal year ended
March 31, 2001 March 31, 2002 March 31, 2003 March 31, 2004
---------------------------------------------------------------------------------------------------------
Net sales 1,538.2 1,672.3 1,738.3 1,780.2
(Overseas) (607.8) (769.6) (842.3) (866.1)
---------------------------------------------------------------------------------------------------------
Income before income 97.7 113.9 123.4 143.0
taxes
---------------------------------------------------------------------------------------------------------
Net income 53.2 61.6 72.5 91.7
---------------------------------------------------------------------------------------------------------
Net income per share 76.85 88.27 99.79 123.63
(yen)
---------------------------------------------------------------------------------------------------------
Total assets 1,704.7 1,832.9 1,884.9 1,852.7
---------------------------------------------------------------------------------------------------------
Total shareholders' 556.7 633.0 657.5 795.1
investment
---------------------------------------------------------------------------------------------------------
Notes:
1. The consolidated financial statements of the Company are prepared in
accordance with accounting principles generally accepted in the United
States (U.S. GAAP).
2. Net income per share is based on the average number of shares of common
stock during the period under review.
3. ISSUES TO BE RESOLVED
While the economic fundamentals in Japan and the U.S. have been showing an
upturn since the latter half of the previous year, the economic prospects are
still unclear because of the concerns regarding the on-going appreciation of the
yen and the sensitive global situation, such as the destabilization of Middle
East. In addition, the business climate is also uneasy as the competition in the
field of colorization of documents and digitization of networks is increasingly
intensifying.
It is of utmost importance to enhance our corporate competitiveness through
the "creation of new value for the customers" and in "highly efficient corporate
management" for Ricoh Group to achieve growth and expansion in such business
environment.
In order to realize our aim to be the "world's No.1 product-engineering
company", it is essential to be a creator of new customer value by identifying
new needs of the customers and providing superior value ahead of our peers. With
such vision in mind, we shall strive harder than ever before to implement the CS
(customer satisfaction) Operation by proactively creating new value and
enhancing our technical capabilities by imbuing our products and services with
such value.
Furthermore, as the value we seek to provide to the customers, we intend to
realize "Simplify Knowledge Creation", "Harmonize with the Environment" and
"Think Solutions That Fit". In other words, we shall make further efforts: to
support the knowledge creation activities of the customers and provide them with
the technical environment for knowledge creation; to supply products and
services which will enable the customers to contribute to protect the
environment; and to improve user-friendliness for optimal utilization of our
products and services.
-9-
Moreover, we continue to enhance the efficiency of the Ricoh Group through
ongoing streamlining of processes in every business area, thereby increasing
overall efficiency of corporate operations. We intend to further improve
profitability through this increased operational efficiency and proactively
allocate the created surplus to future growth.
Acquisition of the shares of Hitachi Printing Solutions Co., Ltd., of which
basic agreement was reached at the end of March 2004, will also be implemented
with utmost effort in order to reinforce and expand our printer business.
4. SUBSEQUENT EVENTS
There were no significant subsequent events.
-10-
BALANCE SHEETS (NON-CONSOLIDATED)
Millions of yen
---------------------------------
As of March 31,
---------------------------------
2004 2003
-------------- ---------------
ASSETS
Current Assets:
Cash on hand and in banks 14,687 8,951
Notes receivable -- trade 7,345 6,287
Accounts receivable -- trade 209,588 170,349
Marketable securities 211,045 132,096
Finished goods 24,043 20,711
Raw materials 2,934 3,397
Work-in-process 6,286 5,572
Supplies 6,448 5,680
Short-term loans receivable 27,213 3,323
Deferred tax assets 17,415 19,417
Accounts receivable -- other 14,551 119,481
Other current assets 4,393 3,934
Allowance for doubtful accounts -1,965 -1,049
Total current assets 543,987 498,155
Fixed Assets:
Tangible fixed assets:
Buildings 41,503 41,408
Structures 1,752 1,797
Machinery and equipment 18,619 18,914
Vehicles 15 17
Tools 19,044 17,898
Land 26,023 24,478
Construction in process 3,570 2,669
Total tangible fixed assets 110,528 107,183
Intangible assets
Leasehold right and others 9,296 9,438
Software 17,597 11,907
Total intangible fixed assets 26,893 21,346
Investments and Other Assets:
Investment securities 26,083 76,143
Affiliates' securities 131,715 126,622
Investment in affiliates 19,014 18,158
Long-term loans receivable 61,669 55,482
Deferred tax assets 10,913 23,721
Lease deposit 5,930 5,709
Other investments 3,399 3,595
Allowance for doubtful accounts -2,824 -2,777
Total investments and other assets 255,901 306,655
Total fixed assets 393,323 435,186
-------------- ---------------
TOTAL ASSETS 937,310 933,341
============== ===============
-11-
Millions of yen
----------------------------------
As of March 31,
----------------------------------
2004 2003
--------------- ----------------
LIABITITIES
Current Liabilities:
Notes payable -- trade 4,156 6,822
Accounts payable -- trade 99,181 100,348
Accounts payable -- other 13,674 7,791
Accrued expenses 43,805 44,789
Accrued corporate tax and others 6,146 19,375
Accrued bonuses 13,873 15,838
Warranty reserve 330 202
Other current liabilities 5,958 6,090
Total current liabilities 187,125 201,259
Fixed Liabilities:
Bonds 100,000 100,000
Long-term accounts payable -- other 6,445 -
Retirement benefit obligation 341 34,507
Reserve for directors' retirement allowances 982 879
Total long-term liabilities 107,769 135,387
--------------- ----------------
Total Liabilities 294,895 336,646
--------------- ----------------
SHAREHOLDERS' EQUITY
Common Stock 135,364 135,364
Capital Surplus:
Additional paid-in capital 179,522 176,131
Other capital surplus 0 -
Total capital surplus 179,522 176,131
Retained Earnings:
Legal reserve 14,955 14,955
Reserve for deferral of capital gain on property 600 613
Reserve for special depreciation 499 486
Reserve for warranty on computer programs 304 255
Reserve for social promotion 110 119
General reserve 260,350 241,350
Unappropriated retained earnings 58,478 30,248
Total retained earnings 335,298 288,027
Unrealized holding gains on securities 4,161 1,556
Treasury stock -11,932 -4,386
Total Shareholders' Equity 642,415 596,694
--------------- ----------------
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY 937,310 933,341
=============== ================
-12-
STATEMENTS OF INCOME (NON-CONSOLIDATED)
Millions of yen
-----------------------------------
For the year ended March 31,
-----------------------------------
2004 2003
-------------- -------------
Ordinary Income and Loss
Operating income and expenses
Operating income:
Net sales 876,366 855,024
Operating expenses:
Cost of sales 600,991 584,539
Selling, general and administrative expenses 213,213 198,628
Total operating expenses 814,204 783,167
Operating income 62,161 71,856
Non-operating income and expenses
Non-operating income:
Interest and dividends income 6,131 7,251
Other income 3,633 4,110
Total non-operating income 9,765 11,361
Non-operating expenses:
Interest expenses 1,475 1,527
Other expenses 7,938 12,792
Total non-operating expenses 9,414 14,319
Ordinary income 62,513 68,898
Extraordinary Income and Loss
Extraordinary income:
Gain on exemption from the obligation for benefits related
to substitutional portion of Employees' Pension Fund 26,949 -
Gain on transfer of securities to an employee retirement
benefit trust 2,691 -
Gains on sales of shares of a subsidiary 572 -
Gains on settlement of qualified pension plan 6 -
Total extraordinary income 30,219 -
Income before income taxes 92,732 68,898
Provision for income taxes 21,100 33,880
Corporate and other tax adjustments 13,037 -7,862
Net income 58,595 42,880
Retained earnings at beginning of year 5,736 5,703
Reversal of reserve for social contribution 89 81
Retirement of treasury stocks - 13,328
Interim cash dividends 5,943 5,088
-------------- -------------
UNAPPROPRIATED RETAINED EARNINGS AT END OF YEAR 58,478 30,248
============== =============
-13-
I. SIGNIFICANT ACCOUNTING POLICIES
1. VALUATION METHOD FOR SECURITIES
(1) Stocks of subsidiaries and affiliates
Securities of subsidiaries and affiliates are stated at moving average cost.
(2) Other securities
Marketable securities: Marketable securities are marked to market based
on the market price at the end of the term and
other factors (accounting for all valuation
differences with the full capital injection
method; the cost of securities sold is valued at
moving average cost).
Non-marketable securities: Non-marketable securities are stated at cost
based on the moving average method.
2. VALUATION METHOD FOR INVENTORIES
Inventories are stated at the lower of average cost or market.
3. VALUATION STANDARDS AND METHODS FOR DERIVATIVES
Derivatives are stated at market value.
4. DEPRECIATION AND AMORTIZATION
(1) Tangible fixed assets:
Depreciation of tangible fixed assets is computed principally by using the
declining-balance method. Buildings (excluding fixtures) acquired after
April 1, 1998, are depreciated using the straight-line method. The
depreciation periods are basically as follows:
Buildings: 5-50 years
Machinery and equipment: 2-12 years
(2) Intangible assets:
Amortization of intangible assets is computed by using the straight-line
method.
With software for sale in the market, however, the Company records the
larger of a amortization based on projected sales profits or a uniform
amortization based on a projected effective sales period for the balance.
The initially projected effective sales term is three years. With software
for internal use, the Company uses straight-line method based on a usable
period of five years.
5. BASIS FOR PROVISION OF RESERVES
(1) Allowance for doubtful accounts:
The allowance for doubtful accounts is provided to cover possible losses
from bad debts and represents possible individual doubtful accounts based on
historical default rate and the potential for irrecoverability.
-14-
(2) Reserve for accrued bonuses:
The reserve for accrued bonuses is provided by estimating the amount of
bonuses payable to employees for the current fiscal year under our corporate
rules for calculating such bonus payment.
(3) Warranty reserve:
To cover product after-sales service expenses, the Company calculates the
product warranty reserve based on projected service costs during warrantee
terms.
(4) Accrued pension and severance costs:
To cover projected employee benefits, the Company records the estimated
obligations at the end of the current fiscal year based on projected
year-end benefit obligations and plan assets. Amortization of actuarial
gains or losses is computed by the straight-line method over the averaged
remaining employment term (15 years). Amortization of prior service cost is
computed by the straight-line method over the averaged remaining employment
term (15 years).
(Additional Information)
On January 1, 2004, the Company obtained an approval from the Minister of
Health, Welfare and Labor for the return of the past substitute portion of
Employees' Pension Fund in accordance with the enforcement of
Defined-benefit Corporate Pension Law, and made the reimbursement of the
minimum responsible reserve to the government. The amount of profit/loss in
the fiscal year being affected by this operation is Yen 26,949 million,
which is booked as an extraordinary profit. In accordance with the
Defined-benefit Corporate Pension Law coming into force, the Company made
transitions of the lump-sum retirement payment plan and the qualified
retirement pension system to the defined contribution plan and the
retirement benefit prepayment system, respectively, and adopted "Accounting
Process Regarding Transition of Retirement Benefit System" (Corporate
Accounting Standard Application Policy No.1). The effects of this operation
were Yen 6 million booked as an extraordinary profit.
(5) Reserve for directors' retirement allowances:
Ricoh calculates the necessary amounts of directors retirement allowances
based on internal rules at year-end, in compliance with the provisions in
Article 43 of the Commercial Code Enforcement Regulation.
6. CONSUMPTION TAXES
Consumption taxes are excluded from revenues and expenses.
7. LEASING
Finance leases for which ownership does not transfer to leasees are accounted
for as operating leases.
8. HEDGE ACCOUNTING
(1) Hedge accounting methods:
Ricoh accounts for hedges at market value. With currency swaps, however, the
Company hedges by assigning transactions that meet assignment requirements.
-15-
(2) Hedge instruments and targets:
There is no hedging instrument or hedging target at the end of current
fiscal year.
(3) Hedging policies:
In keeping with its internal Market Risk Management Rules, Ricoh uses
derivatives to manage the exposure of its assets and liabilities to market
fluctuations.
(4) Hedge effectiveness:
Ricoh assesses the effectiveness of hedges by analyzing the ratios of the
total market fluctuations of hedged targets and instruments.
9. From the fiscal year under review, the financial statements are prepared in
accordance with the Revised Commercial Code Enforcement Regulation as specified
by "Ministerial Ordinance for the Revised Commercial Code Enforcement
Regulation" (Ministry of Justice Ordinance No.68 of September 22, 2003).
II. NOTES TO BALANCE SHEETS (Millions of yen)
1. Short-term receivable due from subsidiaries Yen 215,199
Long-term receivable due from subsidiaries Yen 62,007
2. Short-term payable due to subsidiaries Yen 46,657
3. Accumulated depreciation on tangible fixed assets Yen 327,967
4. Guarantee obligation Yen 512
5. Trade notes receivable discounted with banks Yen 27
6. Shares of common stock issued and outstanding at year-end 744,912,078 shares
Shares of treasury stock held at year-end 6,017,187 shares
7. In addition to the fixed assets stated in the balance sheet, the Company uses
computer and electronic component manufacturing facilities under lease
agreements.
8. Increase in net assets by applying current value to the net assets pursuant
to Article 124-3 of the Commercial Code Enforcement Regulation. Yen 4,161
9. The amounts less than one million yen have been omitted.
III. NOTES TO STATEMENTS OF INCOME (Millions of yen; except for net income per share)
1. Sales to subsidiaries Yen 740,976
2. Purchases from subsidiaries Yen 281,669
3. Non-operating transactions with subsidiaries: Yen 305,030
Transfer of assets Yen 146,453
Transfer of liabilities Yen 147,788
Others Yen 10,789
4. Net income per share (yen) Yen 79.18
5. The amounts less than one million yen have been omitted.
-16-
PROPOSAL FOR APPROPRIATION OF UNAPPROPRIATED RETAINED EARNINGS
Yen
------------------------------------------------
For the year ended March 31,
------------------------------------------------
2004 2003
---------------------- ----------------------
Unappropriated retained earnings at end of year 58,478,829,574 30,248,567,126
Reversal of reserve for deferral of capital gain on
property 25,773,094 27,478,909
Reversal of reserve for special depreciation 198,199,491 104,573,744
Reversal of reserve for warranty on computer programs
85,900,776 91,806,833
Total 58,788,702,935 30,472,426,612
To be appropriated as follows:
Cash dividends 7,388,948,910 5,198,260,445
[per share] [10.00] [7.00]
Director bonuses 178,800,000 183,400,000
Reserve for deferral of capital gain on property - 14,137,521
Reserve for special depreciation 500,529,515 118,240,207
Reserve for warranty on computer programs - 141,070,970
Reserve for social contribution 89,800,000 81,000,000
General reserve 41,000,000,000 19,000,000,000
---------------------- ----------------------
Retained earnings brought forward to the next fiscal year 9,630,624,510 5,736,317,469
====================== ======================
Notes:
On December 1, 2003, the Company paid interim cash dividends of Yen 8.00 per
share, totaling Yen 5,943,250,104.
-17-
English Translation of the Auditors' Report Originally Issued in Japanese
Language
INDEPENDENT AUDITORS' REPORT
April 26, 2004
The Board of Directors
Ricoh Company, Limited
KPMG AZSA & Co.
Teruo Suzuki (seal), Representative Partner
Certified Public Accountant
Tetsuzo Hamajima (seal), Representative and Engagement Partner
Certified Public Accountant
Mikihiro Himeno (seal), Engagement Partner
Certified Public Accountant
We have audited the statutory report, that is the balance sheets, the
statements of income, the business report (limited to accounting matters), and
the proposal for appropriation of unappropriated retained earnings, and its
supporting schedules (limited to accounting matters) of Ricoh Company Limited
for the 104/th/ business year from April 1, 2003 to March 31, 2004 in accordance
with Article 2 of the "Law for Special Exceptions to the Commercial Code
Concerning Audits, etc. of Kabushiki Kaisha". With respect to the aforementioned
business report and supporting schedules, our audit was limited to those matters
derived from the accounting books and records of the Company and its
subsidiaries. The statutory report and supporting schedules are the
responsibility of the Company's management. Our responsibility is to express an
opinion on the statutory report and supporting schedules based on our audit as
independent auditors.
We conducted our audit in accordance with generally accepted auditing
standards in Japan. Those auditing standards require us to obtain reasonable
assurance about whether the statutory report and supporting schedules are free
of material misstatement. An audit is performed on a test basis, and includes
assessing the accounting principles used, the method of their application and
estimates made by management, as well as evaluating the overall presentation of
the statutory report and supporting schedules. We believe that our audit
provides a reasonable basis for our opinion. Our audit procedures also include
those considered necessary for the Company's subsidiary.
As a result of the audit, our opinion is as follows:
(1) The balance sheet and the statement of income present fairly the
financial position and the results of operations of the Company in
conformity with related laws and regulations and the Articles of
Incorporation of the Company.
(2) The business report (limited to accounting matters) presents fairly
the status of the Company in conformity with related laws and
regulations and the Articles of Incorporation of the Company.
(3) The proposal for appropriation of unappropriated retained earnings has
been prepared in conformity with related laws and regulations and the
Articles of Incorporation of the Company.
(4) With respect to the supporting schedules (limited to accounting
matters) there are no items to be noted that are not in conformity
with the provisions of the Commercial Code.
Our firm and engagement partners have no interest in the Company which
should be disclosed pursuant to the provisions of the Certified Public
Accountants Law of Japan.
-18-
English translation of the corporate auditor's report originally issued in
Japanese
CORPORATE AUDITOR'S REPORT
April 27, 2004
The Board of Corporate Auditors received each corporate auditor's report on
audit methods and results concerning the execution of duties of each director
for the business year from April 1, 2003 to March 31, 2004. Upon discussion, the
board prepared this audit report as follows.
1. OUTLINE OF CORPORATE AUDITORS' AUDIT METHODS
Each of the corporate auditors, in accordance with the policy and work shares
prescribed by the Board of Corporate Auditors, attended the meetings of the
Board of Directors and other important meetings of the Company, received reports
on business operations from the Directors, etc., inspected important written
approvals, etc., inquired into the activities and assets of the head office and
principal places of business and had the subsidiaries of the Company submit
reports on their business operations whenever necessary. The board also received
reports and briefings from the independent auditors, and examined the accounting
documents and schedules of the Company.
With respect to any transactions by the Directors, transaction between the
Directors and the Company involving conflict of interests, the gratuitous
provision of profits by the Company and any other transactions not customary in
nature between the Company and its subsidiaries or shareholders, and acquisition
and disposal of treasury stock, we, in addition to the above mentioned auditing,
asked the Directors, etc. to submit reports, whenever necessary, and examined
these transactions in detail.
2. AUDIT RESULTS
(1) We hereby state that the audit method and results of KPMG AZSA & Co.,
independent auditors, are appropriate.
(2) We hereby state that the business report fairly presents the Company's
situation in accordance with the law and the Articles of Incorporation.
(3) There is no matter that should be specially indicated for the proposal for
appropriation of unappropriated retained earnings, considering the state of
Company's asset and other circumstances.
(4) Supporting schedules fairly present matters to be disclosed, and there is no
item that should be indicated.
(5) There is no important fact that represents an unfair act, or violates the
law or the Articles of Incorporation, with respect to the execution of
directors' duties including those for the subsidiary.
Also, we found no violations of duties by directors with respect to the covenant
not to compete for directors, conflicts of interest between directors and the
Company, offering of the Company's profits for free, unordinary transactions
with the Company's subsidiary or shareholders, acquisition and disposal of
treasury stock, etc.
The Board of Corporate Auditors, Ricoh Company Limited
Full-time corporate auditors: Hisaaki Koga (seal), Hideyuki Takamatsu (seal)
Corporate auditors: Kenji Matsuishi (seal), Takehiko Wada (seal)
Note: Corporate auditors Kenji Matsuyoshi, Takehiko Wada are outside corporate
auditors in accordance with Paragraph 1, Article 18 of the Law for Special
Exceptions to the Commercial Code Concerning Audits, etc., of Kabushiki Kaisha.
-19-
(FOR REFERENCE)
CONSOLIDATED BUSINESS REPORT
CONSOLIDATED OPERATING RESULTS
ACHIEVING CONTINUOUS INCREASE IN CONSOLIDATED SALES FOR 10 YEARS AND
CONSOLIDATED INCOME FOR 12 YEARS IN A ROW
The amount of consolidated net sales in the fiscal year was Yen 1,780.2 billion
(up 2.4% from previous fiscal year) driven by increased sales of printing
systems, especially color MFPs (multi-function printers), in both the domestic
and overseas markets, thereby marking continuous increase of sales for 10
consecutive years.
Consolidated operating income in the fiscal year was Yen 150.0 billion (up
12.2% from the previous fiscal year) owing to the expanded sale of high
value-added products, especially color MFPs and the increase of income by
continually implementing cost reductions, which exceeded the increase of
strategic expenditures, such as research & development cost and costs of core IT
system development as well as pension reserves.
Consolidated income before income taxes was Yen 143.0 billion (up 15.9% from
the previous fiscal year), as the interest paid was decreased due to the
reduction of interest bearing debts and the non-operating income increased due
to gains from the additional transfer of a portion of the securities held to the
retirement benefit trust account in accordance with the reform of pension plans,
etc.
Furthermore, in accordance with the said additional transfer of securities to
the retirement benefit trust, an accounting transaction was made to reflect the
accumulated gains from the establishment of the trust fund made in the past to
the income of the year under review.
As a result of the above, consolidated net income of the fiscal year was
Yen 91.7 billion, a 26.6% increase from the previous year, and we achieved a
continuous increase of consolidated income for 12 years in a row as well as a
continuous renewal of the record-high consolidated income for 10 years.
REINFORCING OUR FINANCIAL STRENGTH THROUGH THE REFORM OF THE PENSION PLAN
Due to the increase of consolidated net profit of the fiscal year and other
favorable conditions, the free cash flow, which is the aggregated cash flow
generated by operating and financing activities, increased by Yen 3.9 billion
from the previous fiscal year to mark Yen 91.5 billion.
Furthermore, as the result of reduced interest bearing debts through the
efficient use of funds in Ricoh Group, the amount of interest bearing debts
decreased by Yen 51.8 billion, compared with the previous year.
In the fiscal year, we returned substitute portion of Employees' Pension Fund
to the government and implemented the reform of the pension plan themselves,
which resulted in the reduction of the retirement benefit obligations by Yen
125.5 billion. Concurrently, the loss of the adjustment account for pensions to
be disbursed (listed under the assets) was decreased by Yen 74.2 billion. As the
result, the return on equity increased by 8.0 percentage points from the
previous fiscal year to 42.9%, thus further enhancing the financial strength of
the Ricoh Group.
-20-
OPERATING RESULTS/FINANCIAL CONDITIONS (CONSOLIDATED BASIS)
(Billions of yen; except for net income per share)
------------------------------------------------------------------------------------------------------------
Items Fiscal year ended Fiscal year ended Fiscal year ended Fiscal year ended
March 2001 March 2002 March 2003 March 2004
------------------------------------------------------------------------------------------------------------
Net sales 1,538.2 1,672.3 1,738.3 1,780.2
(Overseas) 607.8 769.6 842.3 866.1
------------------------------------------------------------------------------------------------------------
Income before 97.7 113.9 123.4 143.0
income taxes
Net income 53.2 61.6 72.5 91.7
Net income per share 76.85 88.27 99.79 123.63
(yen)
------------------------------------------------------------------------------------------------------------
Total assets 1,704.7 1,832.9 188.49 1,852.7
Total shareholders' 556.7 633.0 657.5 795.1
equity
Return on equity (%) 32.7 34.5 34.9 42.9
------------------------------------------------------------------------------------------------------------
Notes:
1. The consolidated financial statements of the Company are prepared in
accordance with accounting principles generally accepted in the United
States (U.S. GAAP).
2. Net income per share is based on the average number of shares of
outstanding common stock during the fiscal year.
-21-
CONSOLIDATE FINANCIAL STATEMENTS (1)
CONSOLIDATED BALANCE SHEETS
As of March 31, (Millions of yen)
-------------------------- Year-on-year
2004 2003 change
--------- --------- -----------------
ASSETS
Current Assets:
Cash and time deposits 204,001 200,330 3,671
Trade receivables 422,244 417,942 4,302
Marketable securities 45,124 107 45,017
Inventories 145,369 146,051 -682
Other current assets 55,079 58,083 -3,004
Total current assets 871,817 822,513 49,304
Fixed Assets:
Tangible fixed assets 238,712 248,752 -10,040
Finance receivable 514,047 476,293 37,754
Other investment 228,217 337,364 -109,147
Total fixed assets 980,976 1,062,409 -81,433
--------- --------- --------
TOTAL ASSETS 1,852,793 1,884,922 -32,129
========= ========= ========
Notes:
- The breakdown of cash and time deposits:
(Millions of yen)
CURRENT FISCAL YEAR Previous fiscal year
------------------- --------------------
Cash and cash equivalents 203,039 189,243
Time deposits 962 11,087
- Exchange rate at the end of the fiscal periods:
CURRENT FISCAL YEAR Previous fiscal year
------------------- --------------------
US$1= Yen 105.69 Yen 120.20
EURO 1= Yen 128.88 Yen 129.83
-22-
CONSOLIDATED BALANCE SHEETS
As of March 31, (Millions of yen)
------------------------- Year-on-year
2004 2003 change
--------- --------- -----------------
LIABILITIES
Current Liabilities:
Trade payables 297,672 280,798 16,874
Short-term borrowings 151,162 138,713 12,449
Other current liabilities 158,594 169,072 -10,478
Total current liabilities 607,428 588,583 18,845
Long-term Liabilities:
Long-term indebtedness 281,570 345,902 -64,332
Retirement benefit obligation 83,492 209,011 -125,519
Other liabilities 36,295 30,653 5,642
Total fixed liabilities 401,357 585,566 -184,209
--------- --------- --------
TOTAL LIABILITIES 1,008,785 1,174,149 -165,364
--------- --------- --------
MINORITY INTERESTS 48,877 53,259 -4,382
SHAREHOLDERS' EQUITY
Common stock 135,364 135,364 -
Additional paid-in capital 186,599 186,521 78
Retained earnings 515,372 434,748 80,624
Accumulated other comprehensive income (loss) -30,272 -94,733 64,461
Treasury stock -11,932 -4,386 -7,546
Total shareholders' equity 795,131 657,514 137,617
--------- --------- --------
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY 1,852,793 1,884,922 -32,129
========= ========= ========
Note:
- Other comprehensive income
(Millions of yen)
CURRENT FISCAL Previous Year-on-year
YEAR fiscal year change
-------------- ----------- -----------------
Net unrealized holding gains
on available-for-sale securities 4,026 8,582 -4,556
Pension liability adjustments -14,863 -89,119 74,256
Net unrealized gains (losses) on derivative
instruments -24 -178 154
Cumulative translation adjustments -19,411 -14,018 -5,393
-23-
CONSOLIDATED FINANCIAL STATEMENTS (2)
CONSOLIDATED STATEMENTS OF INCOME
For the year ended March (Millions of yen)
-------------------------- Year-on-year
2004 2003 change (%)
--------- ---------- -----------------
Net sales 1,780,245 1,738,358 2.4
Cost of sales 1,014,619 993,009 2.2
Gross profit 765,626 745,349 2.7
Selling, general and administrative expenses 615,620 611,695 0.6
Operating income 150,006 133,654 12.2
Interest and dividend income 1,925 3,772 -49.0
Interest expenses 5,290 6,853 -22.8
Other, net 3,578 7,103 -49.6
Income before income taxes, minority
interests, equity in earnings of affiliates and
cumulative effect of accounting change 143,063 123,470 15.9
Provision for income taxes 56,641 51,984 9.0
Minority interests 4,094 1,376 197.5
Equity in earnings of affiliates 2,065 2,403 -14.1
Income before cumulative effect of
accounting changes 84,393 72,513 16.4
Cumulative effect of accounting change, net
of tax 7,373 - -
--------- --------- --------------
Net income 91,766 72,513 26.6
========= ========= ==============
FOR REFERENCE: (Billions of yen)
Research and development expenditures 92.5 83.5 10.8%
(Percentage of net sales amount) 5.2% 4.8% -
EFFECT OF EXCHANGE RATE FLUCTUATION ON THE SALES AMOUNT:
The sales in the year under review continued at a brisk pace driven by sales of
color copiers and printing systems in both the domestic and overseas markets,
outperforming the results recorded in the previous fiscal year. Foreign exchange
adjustments reduced the sales amount in the U.S. with the appreciation of the
yen against the U.S. dollar but the sales value expanded dramatically in Europe
due in part to the depreciation of the yen against the Euro. Even after the
adjustment for the effect of foreign exchange fluctuations, the overseas sales
amount increased by 1.5%.
(DOMESTIC AND OVERSEAS SALES) (Billions of yen; %)
--------------------------------------------------------------------------------------------------------
Current fiscal year Previous fiscal year Year-on-year change Growth rate *
--------------------------------------------------------------------------------------------------------
Domestic 914.0 896.0 2.0% 2.0%
Overseas 866.1 842.3 2.8% 1.5%
--------------------------------------------------------------------------------------------------------
Total 1,780.2 1,738.3 2.4% 1.8%
--------------------------------------------------------------------------------------------------------
Note: * After foreign exchange adjustments. The growth rate is based on the
assumption that the current foreign exchange rate is equivalent to the previous
year's rate.
Foreign exchange rates (average rates during the period under review):
-----------------------------------------------------------------
Current fiscal year Previous fiscal year
-----------------------------------------------------------------
US$1 Yen 113.09 Yen 121.96
EURO 1 Yen 132.65 Yen 121.00
-----------------------------------------------------------------
-24-
CONSOLIDATED STATEMENTS OF CASH FLOW
(Millions of yen)
For the year ended March 31,
----------------------------------
2004 2003
----------- -----------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income 91,766 72,513
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation and amortization 76,968 76,551
Decrease (increase) in trade receivable -11,367 22,176
Decrease (increase) in inventories -4,317 14,983
Increase in trade payables 21,316 5,632
Other, net -19,455 -6,113
Net cash provided by operating activities 154,911 185,742
CASH FLOWS FROM INVESTING ACTIVITIES:
Sales (purchases) of tangible fixed assets, net -75,242 -71,739
Sales (purchases) of available-for-sale securities, net 9,946 -27,706
Other, net 1,913 1,246
Net cash used in investing activities -63,383 -98,199
CASH FLOWS FROM FINANCING ACTIVITIES:
Decrease of borrowings, indebtedness and debt
securities, net -51,798 -39,055
Cash dividends paid -11,136 -10,176
Purchase of treasury stocks -11,411 -17,281
Other, net -490 -631
Net cash used in financing activities -74,835 -67,143
Effect of exchange rate changes on cash and cash -2,897 -1,329
equivalents
Net increase in cash and cash equivalents 13,796 19,071
Cash and cash equivalents at beginning of year 189,243 170,172
----------- -----------
Cash and cash equivalents at end of period 203,039 189,243
=========== ===========
STATUS OF RICOH GROUP COMPANIES
The Ricoh Group consists of the Company itself, its 360 subsidiaries (321
consolidated subsidiaries and 39 subsidiaries accounted for under the equity
method) and 21 affiliates (all accounted for under the equity method).
-25-
REFERENCE MATERIAL FOR EXERCISING VOTING RIGHTS
1. NUMBER OF VOTING RIGHTS OF ALL SHAREHOLDERS: 732,169
2. AGENDA AND INFORMATION:
AGENDA 1: APPROVAL OF THE PROPOSED APPROPRIATION OF RETAINED EARNINGS FOR THE
FISCAL YEAR (April 1, 2003, to March 31, 2004)
The proposal for appropriation of retained earnings is described in the attached
104th Business Report (See page 17).
Year-end cash dividends to shareholders for the current term will be paid at
the rate of Yen 10.00 per share, in consideration of our business results for
the current term, the strengthening of our corporate structure and the expansion
of business in the future. Including interim cash dividends for the current
term, shareholders will earn a total of Yen 18.00 per share in cash dividends.
AGENDA 2: PARTIAL AMENDMENT TO THE ARTICLES OF INCORPORATION
(1) Reasons for change:
On September 25, 2003, the "Law Regarding Partial Revision of the Commercial
Code and the Law for Special Exceptions to the Commercial Code concerning
Audit, etc. of Kabushiki Kaisha" (Law No.132, 2003) came into effect,
enabling the purchase of treasury stocks if so resolved by the Board of
Directors based on the provisions of Articles of Incorporation. Accordingly,
the Company proposes to newly stipulate the provisions for the purchase of
treasury stocks as Article 6 of the Articles of Incorporation.
Accordingly, current Article 6 and subsequent articles are to be
renumbered as Article 7 and up.
(2) Details of proposed amendment:
The details of proposed amendment are as stated below.
(Underlined portions indicate the changes)
-----------------------------------------------------------------------------------------------------
Current Articles of Incorporation Proposed provisions after amendment
-----------------------------------------------------------------------------------------------------
Chapter 2 Shares Chapter 2 Shares
(Purchase of Treasury Stocks)
-----------------------------
(Newly established) Article 6 The Company may purchase the shares of its
----------------------------------------------------
own stocks by a resolution of the Board of Directors
----------------------------------------------------
pursuant to Paragraph 1, Item 2 of Article 211-3 of
----------------------------------------------------
the Commercial Code.
--------------------
Article 6 through 33 Article 7 through 34
- -- - --
Provisions omitted. (Unchanged)
-----------------------------------------------------------------------------------------------------
-26-
AGENDA 3: ELECTION OF FOURTEEN (14) DIRECTORS
As the tenure of office of fourteen (14) directors will expire at the end of
this General Meeting of Shareholders, the Company proposes the appointment of
fourteen (14) directors at this meeting.
The candidates for directors are as follows.
--------------------------------------------------------------------------------------------------------------------------------
No. Name Brief personal profile Number of the
(Date of birth) (the other company's name and position thereof when the candidate is a Company's
representative director of other company; with an asterisk) shares held
--------------------------------------------------------------------------------------------------------------------------------
Apr. 1966 Joined the Company
May 1984 President, Ricoh UK Products Ltd.
Apr. 1990 General Manager, Materials Procurement Division
1 Masamitsu Sakurai Jun. 1992 Director of the Company
(January 8, 1942) Apr. 1993 President, Ricoh Europe B. V. 7,000
Jun. 1994 Managing Director of the Company
Mar. 1995 General Manager, Research & Development Group
Apr. 1996 President, Chief Executive Officer and Chief
Operating Officer of the Company (to date)
--------------------------------------------------------------------------------------------------------------------------------
Apr. 1960 Joined the Company
Jun. 1983 Director of the Company
Jun. 1990 Managing Director of the Company
Jun. 1994 Executive Managing Director of the Company
Sep. 1995 General Manager, Finance & Accounting Division
2 Tatsuo Hirakawa Jan. 1996 In charge of Corporate Planning 16,379
(November 17, 1937) Apr. 1997 In charge of Personnel and General Affairs
Apr. 1999 In charge of Semiconductor Business
Jun. 2000 Executive Vice President of the Company (to date)
Oct. 2001 Deputy President of the Company (to date)
Jun. 2003 In charge of Finance & Accounting and Personnel (to date)
--------------------------------------------------------------------------------------------------------------------------------
Apr. 1966 Joined the Company
Apr. 1987 President, Ricoh Electronics, Inc.
Jun. 1992 Director of the Company
Apr. 1993 General Manager, Information System Division
Jun. 1997 Managing Director of the Company
Apr. 1998 General Manager, Production Business Group
3 Koichi Endo Apr. 1999 In charge of DMS Business 12,747
(February 16, 1944) Jun. 2000 Executive Managing Director of the Company
(to date)
Executive Vice President of the Company (to date)
Apr. 2004 In charge of Management Planning, IR & Corporate
Communication, SCM Structure Reformation,
Information Technology & Solution and Legal
Affairs & Intellectual Properties (to date)
--------------------------------------------------------------------------------------------------------------------------------
Apr. 1970 Joined the Company
Jul. 1993 Manager, Tokyo Branch, Imaging Equipment
Marketing Division, Marketing Group
Masayuki Jun. 1994 Director of the Company
4 Matsumoto Jan. 1996 Deputy General Manager, Marketing Division
(December 10, 1944) Oct. 1998 Managing Director of the Company 4,000
General Manager, Marketing Group
Jun. 2000 Executive Vice President of the Company (to date)
Jun. 2002 Executive Managing Director of the Company (to date)
Apr. 2004 In charge of Domestic Sales and CSR (to date)
--------------------------------------------------------------------------------------------------------------------------------
-27-
-----------------------------------------------------------------------------------------------------------------------------
Brief personal profile Number of the
No. Name (the other company's name and position thereof when the candidate is a Company's
(Date of birth) representative director of other company; with an asterisk) shares held
-----------------------------------------------------------------------------------------------------------------------------
Apr. 1967 Joined the Company
Oct. 1990 President, Ricoh Electronics, Inc.
Feb. 1996 Vice Chairman, Ricoh Corporation
Chairman, Ricoh Electronics, Inc.
Apr. 2000 President, Ricoh Corporation
Apr. 2001 Executive Vice President of the Company (to date)
5 Katsumi Yoshida Jun. 2002 Managing Director of the Company (to date) 5,100
(August 20, 1994) Jan. 2003 * Chairman, Ricoh Corporation (to date)
Oct. 2003 General Manager, International Marketing Group of
the Company
* Chairman, Ricoh China Co., Ltd. (to date)
In charge of Overseas Marketing of the Company
and Sales in the U.S. (to date)
Apr. 2004 General Manager, Overseas Business Group (to date)
-----------------------------------------------------------------------------------------------------------------------------
Nov. 1972 Joined the Company
Oct. 1990 General Manager, RP 2/nd/
Division, Imaging Business Group
Jun. 1994 Director of the Company
Mar. 1995 Deputy General Manager, Imaging System
Business Group
Apr. 1998 Director in charge of Imaging System Business
and General Manager, Imaging System Business Group
6 Makoto Hashimoto Jun. 1998 Managing Director of the Company (to date) 10,000
(August 26, 1945) Jun. 2000 Executive Vice President of the Company (to date)
Oct. 2000 President, Personal Multimedia Products
Jun. 2003 Company
In charge of CS & Quality Control,
Production, and Materials Purchasing (to date)
General Manager, Management Quality Control
Division (to date)
-----------------------------------------------------------------------------------------------------------------------------
Apr. 1970 Joined the Company
Jun. 1994 General Manager, IPS Business Division, Imaging
System Business Group
Jan. 1996 Head of Management Planning Office
Jun. 1996 Director of the Company
7 Kiyoshi Sakai Apr. 1999 General Manager, Research & Development Group (to date) 4,000
(December 25, 1945) Jun. 2000 Senior Vice President of the Company
In charge of Research & Development (to date)
Jun. 2002 Managing Director of the Development (to date)
Executive Vice President of the Company (to date)
-----------------------------------------------------------------------------------------------------------------------------
Apr. 1972 Joined the Company
Apr. 1990 President, Ricoh UK Products Ltd.
Jan. 1995 President, Ricoh Europe B.V.
8 Takashi Nakamura Jun. 1998 Director of the Company 5,693
(September 2, 1946) Jan. 1999 Head of Management Planning Office
Jun. 2000 Senior Vice President of the Company
Apr. 2002 Group Executive Officer of the Company (to date)
Jun. 2002 * President Ricoh Elemex Corporation (to date)
-----------------------------------------------------------------------------------------------------------------------------
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-----------------------------------------------------------------------------------------------------------------------------
Brief personal profile Number of the
No. Name (the other company's name and position thereof when the candidate is a Company's
(Date of birth) representative director of other company; with an asterisk) shares held
-----------------------------------------------------------------------------------------------------------------------------
Apr. 1973 Joined the Company
Apr. 1998 General Manager, Printer & System Business
Division, Imaging System Business Group
Jul. 1999 Deputy General Manager, Imaging System
Business Group
9 Shiro Kondoh Jun. 2000 Senior Vice President of the Company 4,000
(October 7, 1949) Oct. 2000 General Manager, Imaging System Business Group (to date)
Jun. 2002 Executive Vice President of the Company (to date)
Jun. 2003 Managing Director of the Company (to date)
Apr. 2004 In charge of Imaging System Business,
Planning, Development and Engineering of
Imaging System, and GJ Business (to date)
-----------------------------------------------------------------------------------------------------------------------------
Apr. 1972 Joined the Company
Apr. 1998 President, Ricoh Europe B.V.
Jun. 2000 Group Executive Officer of the Company
Apr. 2002 * Chairman, Ricoh Europe B.V. (to date)
10 Kazuo Togashi * Chairman, NRG Group PLC (to date) 3,000
(November 28, 1949) Jun. 2002 Executive Vice President of the Company (to date)
Jun. 2003 Managing Director of the Company (to date)
In charge of Sales in Europe (to date)
-----------------------------------------------------------------------------------------------------------------------------
Apr. 1971 Joined the Company
Apr. 1998 Deputy General Manager, System Solution
Division, Marketing Group
Jun. 2000 Senior Vice President of the Company
Oct. 2000 Group Executive Officer of the Company
President, Ricoh Technosystems Co., Ltd.
Jun. 2003 Managing Director of the Company (to date)
11 Kazunori Azuma Executive Vice President of the Company (to date) 4,000
(February 11, 1949) Oct. 2003 In charge of Domestic Sales Planning (to date)
* Chairman, Ricoh Technosystems Co., Ltd. (to date)
Deputy General Manager, Marketing Group of the
Company
Nov. 2003 General Manager, Marketing Group (to date)
-----------------------------------------------------------------------------------------------------------------------------
Apr. 1971 Joined the Company
Apr. 1993 General Manager, Finance Department, Finance
and Accounting Division
Jan. 1997 Deputy General Manager, Finance
12 Yuji Inoue and Accounting Division 10,000
(April 4, 1948) Apr. 1998 General Manager, Finance and Accounting
Oct. 1998 Division General Manager, Marketing Division of Ricoh
Leasing Co., Ltd. (to date)
Apr. 2000 * President, Ricoh Leasing Co., Ltd. (to date)
Jun. 2000 Group Executive Officer of the Company (to date)
-----------------------------------------------------------------------------------------------------------------------------
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-----------------------------------------------------------------------------------------------------------------------------
Brief personal profile Number of the
No. Name (the other company's name and position thereof when the candidate is a Company's
(Date of birth) representative director of other company; with an asterisk) shares held
-----------------------------------------------------------------------------------------------------------------------------
Apr. 1976 Joined the Company
Jan. 1993 President, Ricoh France S.A.
Jan. 1998 General Manager, Accounting
13 Zenji Miura Department, Finance & Accounting Division of the Company 2,000
(January 5, 1950) Apr. 1998 Deputy General Manager, Finance & Accounting Division
Oct. 2000 Senior Vice President of the Company
General Manager, Accounting Division (to date)
Jun. 2003 Executive Vice President of the Company (to date)
-----------------------------------------------------------------------------------------------------------------------------
April 1955 Joined NHK
14 Nobuo Mii Jan. 1969 Joined IBM Japan Ltd.
(July 4, 1931) Jan. 1969 Joined IBM Corporation
Oct. 1973 General Manager, Fujisawa
Research Laboratory, IBM Japan Ltd. 0
March 1977 Director of IBM Japan Ltd.
April 1990 Vice President of IBM Japan Ltd.
June 1990 Vice President of IBM Corporation
Oct. 1997 * Managing Partner of Ignite Group (to date)
June 2000 Director of the Company (to date)
-----------------------------------------------------------------------------------------------------------------------------
Notes:
1. There is no conflict of interests between the candidate and the Company.
2. Mr. Nobuo Mii meets the requirements regarding the outside directors
prescribed in Article 188, Paragraph 2-7-2 of the Commercial Code.
-30-
AGENDA 4: ELECTION OF THREE (3) CORPORATE AUDITORS
As the tenure of office of corporate auditors Hisaaki Koga and Takehiko Wada
will expire at the end of this General Meeting of Shareholders, the Company
proposes the appointment of three (3) corporate auditors at this meeting.
The board of corporate auditors has given its consent to these nominations.
The candidates for corporate auditors are as follows.
---------------------------------------------------------------------------------------------------------------------
Brief personal profile Number of the
No. Name (the other company's name and position thereof when the candidate Company's
(Date of birth) is a representative director of other company; with an asterisk) shares held
---------------------------------------------------------------------------------------------------------------------
April 1967 Joined the Company
Oct. 1991 Deputy General Manager, Personnel Division
1 Hisaaki Koga April 1995 General Manager, Sendai Office, Marketing Group
(April 5, 1943) April 1998 Head of General Manager's Office, Marketing 5,253
Group
June 1998 Standing Corporate Auditor of the Company
(to date)
---------------------------------------------------------------------------------------------------------------------
April 1971 Joined the Company
July 1988 President, Ricoh Finance Ltd.
May 1991 Head of Administration Office, System
Development Division
2 Koji Tomizawa June 1993 General Manager, Marketing Administration
(May 25, 1946) Department, International Division 1,000
June 1997 Managing Director of Ricoh Logistics Co., Ltd.
July 2001 Director of Tokyo Ricoh Co., Ltd. (to date)
June 2004 Scheduled to retire from director of Tokyo Ricoh
Co., Ltd.
---------------------------------------------------------------------------------------------------------------------
April 1958 Joined Sanai-oil Co., Ltd.
June 1985 Director of Sanai-oil Co., Ltd.
3 Takehiko Wada June 1990 Managing Director of Sanai-oil Co., Ltd. 0
(October 24, 1935) July 1994 Executive Managing Director of Sanai-oil Co., Ltd.
June 1999 * President of Sanai-oil Co., Ltd. (to date)
June 2001 Corporate Auditor of the Company (to date)
---------------------------------------------------------------------------------------------------------------------
Notes:
1. There is no conflict of interests between the candidates and the Company.
2. Mr. Takehiko Wada meets the requirements regarding the outside corporate
auditors prescribed in Article 18, Paragraph 1 of the Law for Special
Exceptions to the Commercial Code concerning Audit, etc. of Kabushiki
Kaisha.
-31-
AGENDA 5: GRANTING OF RETIREMENT ALLOWANCES TO RETIRING DIRECTORS
The Company proposes to pay retirement allowances in appropriate amounts with
the set limits, according to the standards prescribed by the Company and the
past practice, to Mr. Masami Takeiri, who resigned as a director as of September
30, 2003, Mr. Naoto Shibata, who resigned as a director as of March 31, 2004,
and Messrs. Hiroshi Hamada, Haruo Kamimoto and Josei Itoh, who will retire as
directors at the end of this meeting, in order to reward their services. The
Company requests that the details such as the amount, timing and manner of
payment shall be left to the decisions of the Board of Directors.
Brief personal profile of the retiring directors are as follows.
-------------------------------------------------------------------------------------------------------------------------
Name Brief personal profile
-------------------------------------------------------------------------------------------------------------------------
June 1994 Director of the Company
June 1998 Managing Director of the Company
Masami Takeiri June 2002 Executive Managing Director of the Company
Sep. 2003 Resigned as Executive Managing Director of the Company
-------------------------------------------------------------------------------------------------------------------------
June 1992 Director oft he Company
June 1996 Managing Director of the Company
Naoto Shibata June 2000 Executive Managing Director of the Company
March 2004 Resigned as Executive Managing Director of the Company
-------------------------------------------------------------------------------------------------------------------------
May 1975 Director of the Company
June 1980 Managing Director of the Company
Hiroshi Hamada April 1981 Executive Managing Director and Representative Director of the Company
April 1983 President and Representative Director of the Company
April 1996 Chairman and Representative Director of the Company (to date)
-------------------------------------------------------------------------------------------------------------------------
June 1980 Director of the Company
Haruo Kamimoto June 1990 Managing Director of the Company
June 1994 Executive Managing Director of the Company
October 2001 Deputy President and Representative Director of the Company (to date)
-------------------------------------------------------------------------------------------------------------------------
Josei Itoh June 2000 Director of the Company (to date)
-------------------------------------------------------------------------------------------------------------------------
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