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 January 2005
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: January 27, 2005
Information furnished on this form:
EXHIBITS
Exhibit Number |
||
1. | Consolidated Financial Results for the Nine Months Ended December 31, 2004 | |
2. | Notice relating to Transfer of Domestic Sales Business of Solar Energy Products of Kyocera Group |
January 27, 2005
KYOCERA CORPORATION
Consolidated Financial Highlights (Unaudited)
Results for the Nine Months Ended December 31, 2004
(Yen in millions, except per share amounts and exchange rates)
Nine months ended December 31, |
Increase (Decrease) (%) |
||||||
2004 |
2003 |
||||||
Net sales |
892,642 | 815,832 | 9.4 | ||||
Profit from operations |
81,399 | 48,478 | 67.9 | ||||
Income before income taxes |
88,965 | 53,698 | 65.7 | ||||
Net income |
57,163 | 33,254 | 71.9 | ||||
Average exchange rates : |
|||||||
US$ |
109 | 115 | | ||||
Euro |
135 | 132 | | ||||
Earnings per share : |
|||||||
Net income |
|||||||
Basic |
304.88 | 178.44 | | ||||
Diluted |
304.80 | 178.44 | | ||||
Capital expenditures |
46,202 | 40,584 | 13.8 | ||||
Depreciation |
42,782 | 44,410 | (3.7 | ) | |||
R&D expenses |
41,364 | 34,972 | 18.3 | ||||
Sales of products manufactured outside Japan to net sales (%) |
33.2 | 34.1 | |
- 1 -
Consolidated Results of Kyocera Corporation and its Subsidiaries
for the Nine Months Ended December 31, 2004
1. The basic items on preparation for consolidated results for the nine months ended December 31, 2004 :
(1) | The consolidated financial statements are prepared in conformity with accounting principles generally accepted in the United States of America. |
(2) | Change in accounting policies : None |
(3) | Changes in scope of consolidation and application of the equity method : |
Consolidation |
Equity method | |||
Increase |
5 | 2 | ||
Decrease |
2 | 1 |
2. Consolidated financial information for the nine months ended December 31, 2004 :
(1) Consolidated results of operations :
Nine months ended December 31, |
Year ended March 31, |
|||||||||||
2004 |
2003 |
2004 |
||||||||||
Net sales |
¥ | 892,642 million | ¥ | 815,832 million | ¥ | 1,140,814 million | ||||||
% change from the previous period |
9.4 | % | 2.2 | % | 6.6 | % | ||||||
Profit from operations |
81,399 million | 48,478 million | 108,962 million | |||||||||
% change from the previous period |
67.9 | % | (14.0 | )% | 30.7 | % | ||||||
Income before income taxes |
88,965 million | 53,698 million | 115,040 million | |||||||||
% change from the previous period |
65.7 | % | 2.2 | % | 51.3 | % | ||||||
Net income |
57,163 million | 33,254 million | 68,086 million | |||||||||
% change from the previous period |
71.9 | % | 15.6 | % | 65.4 | % | ||||||
Earnings per share : |
||||||||||||
Basic |
¥ | 304.88 | ¥ | 178.44 | ¥ | 364.79 | ||||||
Diluted |
304.80 | 178.44 | 364.78 |
(2) Consolidated financial conditions :
As of December 31, |
As of March 31, |
|||||||||||
2004 |
2003 |
2004 |
||||||||||
Total assets |
¥ | 1,770,575 million | ¥ | 1,776,179 million | ¥ | 1,794,758 million | ||||||
Stockholders equity |
1,190,144 million | 1,117,548 million | 1,153,746 million | |||||||||
Stockholders equity to total assets |
67.2 | % | 62.9 | % | 64.3 | % | ||||||
Stockholders equity per share |
¥ | 6,347.93 | ¥ | 5,960.76 | ¥ | 6,153.83 |
- 2 -
(3) Consolidated cash flows :
Nine months ended December 31, |
Year ended March 31, | ||||||||
2004 |
2003 |
2004 | |||||||
Cash flows from operating activities |
¥ | 101,564 million | ¥ | (3,048) million | ¥ | 62,575 million | |||
Cash flows from investing activities |
(144,795) million | 29,555 million | 29,581 million | ||||||
Cash flows from financing activities |
(58,019) million | (12,893) million | (20,422) million | ||||||
Cash and cash equivalents at end of period |
261,220 million | 304,184 million | 361,132 million |
3. Consolidated financial forecast for the year ending March 31, 2005 :
Year ending March 31, 2005 | |||
Net sales |
¥ | 1,150,000 million | |
Income before income taxes |
¥ | 100,000 million | |
Net income |
¥ | 59,000 million |
Note:
Forecast of earnings per share : 314.59
Net income per share amounts is computed based on Statement of Financial Accounting Standards (SFAS) No.128.
Forecast of earnings per share is computed based on the diluted average number of shares outstanding during the nine months ended December 31, 2004.
With regard to forecasts set forth above, please refer to the accompanying Forward-Looking Statements on page 13.
- 3 -
Business Results, Financial Condition and Prospects
1.Business Results for the Nine Months Ended December 31, 2004
(1) Economic Situation and Business Environment
| During the nine months ended December 31, 2004 (the nine months), the Japanese economy showed a downtrend due to that a stable production activities in the manufacturing sector during the six months ended September 30, 2004 (the first half) turned into a weakness in the six months ending March 31, 2005 (the second half), and also due to a negative impact of continued appreciation of the yen against the U.S. dollar on corporate earnings. Despite a slowdown in the European economy, the U.S. economy expanded steadily led by solid personal consumption and capital expenditures, while the Asian economy continued to manifest healthy growth, particularly in China. |
| The electronics industry, a key market for Kyocera Corporation and its consolidated subsidiaries (Kyocera), has stagnated globally since summer 2004 and now faces a difficult business environment due to production adjustments in the second half for mobile phone handsets, computer equipment and digital consumer products, which had shown steady growth. |
(2) Consolidated Financial Results
(Yen in millions, except per share amounts and exchange rates)
Nine months ended December 31, |
Increase (Decrease) % | |||||
2004 |
2003 |
|||||
Net sales |
892,642 | 815,832 | 9.4 | |||
Profit from operations |
81,399 | 48,478 | 67.9 | |||
Income before income taxes |
88,965 | 53,698 | 65.7 | |||
Net income |
57,163 | 33,254 | 71.9 | |||
Diluted earnings per share |
304.80 | 178.44 | | |||
Average US$ exchange rate |
109 | 115 | | |||
Average Euro exchange rate |
135 | 132 | |
1) Sales
| Net sales for the nine months increased in all operating segments compared with the nine months ended December 31, 2003 (the previous nine months). |
| Demand for Kyoceras components from Fine Ceramics Group and Electronic Device Group expanded, especially for mobile phone handsets and digital consumer products in the first half. The market environment deteriorated upon entering the second half, however, as component demand lessened and component prices dropped. Nevertheless, component sales for the nine months increased significantly compared with the previous nine months. |
- 4 -
| Net sales of Equipment Group increased as compared with the previous nine months due to higher sales of color printers and digital multifunction products (MFPs) and the contribution of camera modules for mobile phone handsets. |
| As a result, consolidated net sales for the nine months amounted to ¥892.6 billion, an increase of 9.4% compared with the previous nine months. |
2) Profits
| Despite the implementation of structural reforms in the optical instruments business to strengthen the business and improve profitability led to a one-off expense, the positive effects of an increase in sales, especially in the components business, and of group-wide structural reforms to boost profitability, began to emerge amid a favorable market environment in the first half. Consequently, profit from operations for the nine months increased by 67.9% from the previous nine months to ¥81.4 billion. Income before income taxes for the nine months increased by 65.7% to ¥89.0 billion, while net income increased by 71.9% to ¥57.2 billion. |
3) Effect of Exchange Rate Fluctuations
| The average yen rate appreciated 6 yen against the U.S. dollar and depreciated 3 yen against the Euro compared with the previous nine months. Consequently, net sales and income before income taxes after translation into yen were negatively affected by approximately 20.0 billion and 2.0 billion yen, respectively, compared with the previous nine months. |
(3) Operating Highlights
1) | Kinseki, Ltd., a wholly-owned subsidiary, and Kyocera Corporation re-organized the operations related to crystal components on April 1, 2004. The marketing division of Kinseki Ltd. was merged into the marketing division of the electronic component of Kyocera Corporation and the manufacturing division of crystal related components of Kyocera Corporation was transferred to Kinseki Ltd. At the same time, Kinseki Ltd. changed its name to Kyocera Kinseki Corporation (Kyocera Kinseki). |
2) | On April 1, 2004, Kyocera integrated the organic material components business into Kyocera SLC Technologies Corporation (KST), a wholly owned subsidiary. Management resources relating to the organic material components business were concentrated in KST to enhance the synergistic effects within Kyocera and to expand the business base. |
- 5 -
3) | On May 18, 2004, Kyocera announced that a new factory would be built in the City of Ayabe, Kyoto Prefecture. Operations are expected to commence in June 2005. At the factory, KST plans to produce organic semiconductor packages and laminated high-density printed circuit boards used in micro processors and chipsets for digital consumer products. Planned investment in the factory totals approximately ¥17.0 billion. |
4) | On June 21, 2004, the Carlyle Group (Carlyle), Kyocera, KDDI Corporation (KDDI) and DDI Pocket, Inc. (DDI Pocket) reached an agreement that a consortium of Kyocera and Carlyle would acquire the business of DDI Pocket, a subsidiary of KDDI. Under the agreement, the company that succeeds DDI Pockets business (New Co) was invested 30% by Kyocera. In cooperation with New Co, Kyocera will endeavor to expand sales in its PHS related business by carving out new markets in Japan as well as overseas. |
5) | Kyocera and Kobe Steel, Ltd. established Japan Medical Materials Corporation (JMM) on September 1, 2004 by merging the medical materials businesses of both companies and commenced operation on the same day. JMM will benefit from the integration of the specialized expertise of both companies in material and processing technologies, while maximizing synergies by integrating development, production and marketing divisions. JMM will also seek to expand its business worldwide as a dedicated manufacturer of medical materials. |
6) | On December 17, 2004, Kyocera announced to transfer its domestic sales division for solar energy products (which handles sales of solar power generation systems for use by domestic public sector industries) by means of a corporate split to Kyocera Solar Corporation (KSC), a consolidated subsidiary of Kyocera, in April 2005. The aim of this move is to expand sales of solar-related products to domestic public sector industries. |
- 6 -
(4) Consolidated Operating Segments
(Yen in millions)
Nine months ended December 31, |
Increase (Decrease) % |
||||||||
2004 |
2003 |
||||||||
Net sales |
892,642 | 815,832 | 9.4 | ||||||
Fine Ceramics Group |
224,767 | 186,519 | 20.5 | ||||||
Electronic Device Group |
202,253 | 188,151 | 7.5 | ||||||
Equipment Group |
399,850 | 384,026 | 4.1 | ||||||
Others |
84,082 | 69,796 | 20.5 | ||||||
Adjustments and eliminations |
(18,310 | ) | (12,660 | ) | | ||||
Operating profit |
78,427 | 44,099 | 77.8 | ||||||
Fine Ceramics Group |
34,789 | 19,606 | 77.4 | ||||||
Electronic Device Group |
29,053 | (1,187 | ) | | |||||
Equipment Group |
5,842 | 18,382 | (68.2 | ) | |||||
Others |
8,743 | 7,298 | 19.8 | ||||||
Corporate |
10,651 | 7,267 | 46.6 | ||||||
Equity in (losses) earnings of affiliates and unconsolidated subsidiaries |
(213 | ) | 1,848 | | |||||
Adjustments and eliminations |
100 | 484 | (79.3 | ) | |||||
Income before income taxes |
88,965 | 53,698 | 65.7 |
Commencing in the three months ended December 31, 2003, net sales and operating profit of the Precision Machine Division of Kyocera Corporation, previously included within Others, have been charged to Corporate. Accordingly, we have restated previously published net sales and operating profit of this operating segment for the previous first half.
1) Fine Ceramics Group
Demand for fine ceramic parts was strong, particularly for semiconductor and LCD fabrication equipment and sapphire substrates for LEDs. In semiconductor parts, sales of ceramic packages and organic packages increased considerably, especially those used in mobile phone handsets and digital consumer products. Sales of solar systems and cutting tools also increased markedly as global markets for these products continued to expand.
Operating profit in this segment increased compared with the previous nine months due mainly to the effect of increased sales and of improved productivity in all business divisions, especially semiconductor parts, solar systems and cutting tools.
2) Electronic Device Group
Sales of ceramic capacitors and crystal-related components grew significantly due to strong components demand, particularly in the first half. Additionally, Kyocera Kinseki, which became a wholly-owned subsidiary in the year ended March 31, 2004, has contributed to sales since the start of the year ending March 31, 2005. Sales of thermal printheads and LCDs also increased steadily.
- 7 -
Operating profit in this segment improved appreciably compared with the previous nine months. This was due primarily to strong sales of key products and improved productivity, while the absence of restructuring charges at a U.S. subsidiary that were recorded in the previous nine months also had a positive effect.
3) Equipment Group
Sales of telecommunications equipment weakened due to intensifying price competition for mobile phone handsets in Japan and overseas, and the negative impact of inventory adjustments for PHS-related products in China. Sales of information equipment, however, increased dramatically through capture of major new users and an expanded product lineup of color printers and digital MFPs. Sales of optical instruments also increased due to new contributions from optical camera modules for mobile phone handsets. As a result, sales of this segment increased markedly compared with the previous nine months.
Nevertheless, operating profit in this segment decreased compared with the previous nine months. Although profit from information equipment grew strongly due to higher sales, profit from telecommunications equipment decreased due to lower sales of mobile phone handsets for the domestic market and PHS-related products for the Chinese market. Meanwhile, optical instruments recorded restructuring charges associated with concentrating management resources into the optical components business. As a result, profit from operations in this segment decreased compared with the previous nine months.
4) Others
Net sales and operating profit in this segment increased due mainly to strong growth of Kyocera Chemical Corporation, especially in its business relating to flexible printed circuit boards and semiconductor epoxy molding compounds, and favorable growth of Kyocera Communications Systems Co., Ltd. (KCCS), especially in its data center, network optimizing and telecommunications engineering businesses.
- 8 -
(5) Orders and Production (Consolidated)
(Yen in millions)
Nine months ended December 31, |
Increase (Decrease) % |
||||||||
2004 |
2003 |
||||||||
Orders |
887,272 | 859,114 | 3.3 | ||||||
Fine Ceramics Group |
226,720 | 194,056 | 16.8 | ||||||
Electronic Device Group |
205,813 | 197,574 | 4.2 | ||||||
Equipment Group |
384,565 | 405,704 | (5.2 | ) | |||||
Others |
88,503 | 74,072 | 19.5 | ||||||
Adjustments and eliminations |
(18,329 | ) | (12,292 | ) | | ||||
Production |
907,912 | 814,233 | 11.5 | ||||||
Fine Ceramics Group |
229,261 | 186,098 | 23.2 | ||||||
Electronic Device Group |
209,290 | 185,117 | 13.1 | ||||||
Equipment Group |
412,492 | 394,266 | 4.6 | ||||||
Others |
56,869 | 48,752 | 16.6 |
(6) Geographic Segments (Sales by region)
(Yen in millions)
Nine months ended December 31, |
Increase (Decrease) % | |||||
2004 |
2003 |
|||||
Sales |
892,642 | 815,832 | 9.4 | |||
Japan |
346,163 | 325,931 | 6.2 | |||
United States of America |
192,153 | 178,622 | 7.6 | |||
Asia |
159,994 | 142,132 | 12.6 | |||
Europe |
129,256 | 112,429 | 15.0 | |||
Others |
65,076 | 56,718 | 14.7 |
1) Japan
Net sales increased compared with the previous nine months due to a rise in sales of solar energy products and components for mobile handsets, digital consumer products, etc. and also due to favorable performance of communication engineering business of KCCS.
2) United States of America
Net sales increased compared with the previous nine months due to a rise in sales of components as well as mobile handsets and information equipment.
3) Asia (excluding Japan)
Net sales increased over the previous nine months due to increased sales in solar energy products and components for mobile handsets, digital consumer products and computer related equipment in addition to favorable sales in information equipment.
- 9 -
4) Europe
Net sales increased over the previous nine months due mainly to growth in sales of information equipment and also to a rise in sales of solar energy products and electronic devices.
5) Others
Net sales increased compared with the previous nine months due to increased sales of telecommunication equipment and information equipment.
2. Cash Flows
Cash and cash equivalents at December 31, 2004 decreased by ¥99.9 billion to ¥261.2 billion compared with at March 31, 2004.
(Yen in millions)
Nine months ended December 31, |
||||||
2004 |
2003 |
|||||
Cash flows from operating activities |
101,564 | (3,048 | ) | |||
Cash flows from investing activities |
(144,795 | ) | 29,555 | |||
Cash flows from financing activities |
(58,019 | ) | (12,893 | ) | ||
Effect of exchange rate changes on cash and cash equivalents |
1,338 | (7,740 | ) | |||
Net (decrease) increase in cash and cash equivalents |
(99,912 | ) | 5,874 | |||
Cash and cash equivalents at beginning of period |
361,132 | 298,310 | ||||
Cash and cash equivalents at end of period |
261,220 | 304,184 |
1) Cash Flows from Operating Activities
Net cash provided by operating activities for the nine months increased by ¥104.6 billion to ¥101.6 billion compared with net cash used in the previous nine months of ¥3.0 billion. This was due to an increase in net income and a significant decrease in receivables by collection, including the short-term finance receivables.
2) Cash Flows from Investing Activities
Net cash used in investing activities for the nine months increased by ¥174.4 billion to ¥144.8 billion from net cash provided by the previous nine months of ¥29.6 billion. This was due mainly to increases in purchases of the government bonds and negotiable certificate of deposits in consideration of current and future financial position according to our investment policy.
3) Cash Flows from Financing Activities
Net cash used in financing activities for the nine months increased by ¥45.1 billion to ¥58.0 billion from the previous nine months of ¥12.9 billion. This was due mainly to payments of long-term debt.
- 10 -
3. Business Outlook and Future Strategies
1) Consolidated Financial Forecast for the Year Ending March 31, 2005 (Announced January 27, 2005)
(Yen in millions, except per share amounts and exchange rates)
Forcast for the year ending March 31, 2005 announced on |
Result for the year ended March 31, 2004 |
Increase (Decrease) to the result for the year ended March 31, 2004 % |
|||||||
January 27, 2005 |
October 28, 2004 |
||||||||
Net sales |
1,150,000 | 1,260,000 | 1,140,814 | 0.8 | |||||
Profit from operations |
95,000 | 135,000 | 108,962 | (12.8 | ) | ||||
Income before income taxes |
100,000 | 140,000 | 115,040 | (13.1 | ) | ||||
Net income |
59,000 | 85,000 | 68,086 | (13.3 | ) | ||||
Diluted earnings per share |
314.59 | 455.40 | 364.78 | | |||||
Average US$ exchange rate |
107 | 106 | 113 | | |||||
Average Euro exchange rate |
135 | 129 | 133 | |
In the fourth quarter (from January 1, 2005 to March 31, 2005), there are concerns that a slowdown in economic growth in Japan and overseas coupled with rapid appreciation of the yen against the U.S. dollar will have a broad negative impact on corporate earnings and the economy.
Sales in the solar energy business and cutting tools business are expected to continue growing steadily. In the electronics industry, however, due to a slump in production activities for mobile phones, computer related equipment and digital consumer products since last summer, Kyocera does not expect any genuine recovery in component demand for these products before the end of the current fiscal year. Sales in Kyoceras components business, namely Electronic Device Group and Fine Ceramics Group, are therefore expected to fall short of previously announced forecasts. Additionally, as a consequence of intensifying price competition for mobile phones and PHS related products, particularly in overseas markets, a decline in sales of telecommunications equipment is projected. As a result, consolidated net sales are expected to fall short of previously announced forecasts by ¥110.0 billion.
Despite promoting initiatives aimed at boosting productivity across Kyocera, this is not expected to cover the negative impact on profits of the declines in sales, and accordingly, profits are projected to dip below previously announced forecasts. Furthermore, Kyocera will record restructuring charges associated with the swift completion of reforms in the telecommunications equipment business and optical instruments business to strengthen market competitiveness and raise profitability. As a result, income before income taxes and net income are expected to fall short of previously announced forecasts by ¥40.0 billion and ¥26.0 billion, respectively.
- 11 -
In light of these circumstances, net sales and operating profit forecasts for each operating segment have been adjusted as follows.
(Yen in millions)
Forcast for the year ending March 31, 2005 announced on |
Result for the year ended March 31, 2004 |
Increase (Decrease) to the result for the year ended March 31, 2004 |
||||||||||
January 27, 2005 |
October 28, 2004 |
|||||||||||
Sales |
1,150,000 | 1,260,000 | 1,140,814 | 0.8 | ||||||||
Fine Ceramics Group |
287,000 | 302,500 | 255,805 | 12.2 | ||||||||
Electronic Device Group |
261,000 | 278,500 | 256,906 | 1.6 | ||||||||
Equipment Group |
518,000 | 585,000 | 545,811 | (5.1 | ) | |||||||
Others |
114,000 | 118,500 | 100,505 | 13.4 | ||||||||
Adjustments and eliminations |
(30,000 | ) | (24,500 | ) | (18,213 | ) | | |||||
Operating profit |
89,500 | 129,700 | 77,126 | 16.0 | ||||||||
Fine Ceramics Group |
42,600 | 47,300 | 31,139 | 36.8 | ||||||||
Electronic Device Group |
33,300 | 42,800 | 5,047 | 559.8 | ||||||||
Equipment Group |
1,000 | 25,700 | 31,257 | (96.8 | ) | |||||||
Others |
12,600 | 13,900 | 9,683 | 30.1 | ||||||||
Corporate |
10,500 | 10,300 | 37,914 | (72.3 | ) | |||||||
Income before income taxes |
100,000 | 140,000 | 115,040 | (13.1 | ) |
2) Business Outlook
Although the yen is expected to continue appreciating in the next fiscal year, particularly against the U.S. dollar, Kyocera expects a full-scale recovery in production activities for electronic equipment from the second half of the next fiscal year.
Kyocera aims to increase profitability in this business environment by promoting its group-wide management policy of high-value-added diversification. In order to strengthen each business and make it into a highly profitable value-added business, Kyocera will boost productivity, primarily by expanding production in China, and invest aggressively in areas with high growth potential, including the solar energy and fuel cell businesses, organic materials components business, components for semiconductor and LCD fabrication equipment, LCDs and organic EL displays. In addition to this investment, Kyocera intends to push forward with initiatives aimed at raising productivity and streamlining production. In the optical instruments and mobile phone businesses, Kyocera seeks to swiftly strengthen market competitiveness and boost profitability.
By promoting such business developments, Kyocera intends to create value-added businesses that will drive its growth for the next fiscal year and beyond.
- 12 -
4. Non-Consolidated Financial Forecast for the Year Ending March 31, 2005
Due to the deteriorating market environment, sales of telecommunications equipment and in the components business are expected to fall short of previously announced forecasts. As a result, non-consolidated net sales are projected to fall below previously announced forecasts by ¥82.0 billion. Furthermore, the decline in net sales is expected to result in non-consolidated recurring profit and net income that are ¥19.0 billion and ¥8.0 billion, respectively, below previously announced forecasts.
(Yen in millions)
Forcast for the year ending March 31, 2005 announced on |
Result for the year ended March 31, 2004 |
Increase % |
|||||||
January 27, 2005 |
October 28, 2004 |
||||||||
Net sales |
480,000 | 562,000 | 494,035 | (2.8 | ) | ||||
Profit from operations |
27,000 | 50,000 | 41,222 | (34.5 | ) | ||||
Recurring profit |
57,000 | 76,000 | 61,788 | (7.7 | ) | ||||
Net income |
40,000 | 48,000 | 60,663 | (34.1 | ) |
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 components; the extent and pace of future growth or contraction in information technology-related markets around the world, including those for communications and personal computers; and events that may impact negatively on our markets or supply chain, including terrorist acts and outbreaks of diseases such as SARS. 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.
- 13 -
CONSOLIDATED BALANCE SHEETS
Yen in millions |
||||||||||||||||
(Unaudited) December 31, 2004 |
March 31, 2004 |
Increase (Decrease) |
||||||||||||||
Amount |
% |
Amount |
% |
|||||||||||||
Current assets : |
||||||||||||||||
Cash and cash equivalents |
¥ | 261,220 | ¥ | 361,132 | ¥ | (99,912 | ) | |||||||||
Short-term investments |
49,789 | 3,855 | 45,934 | |||||||||||||
Trade notes receivable |
33,360 | 33,801 | (441 | ) | ||||||||||||
Trade accounts receivable |
206,239 | 207,583 | (1,344 | ) | ||||||||||||
Short-term finance receivables |
39,952 | 70,553 | (30,601 | ) | ||||||||||||
Less allowances for doubtful accounts and sales returns |
(7,917 | ) | (8,468 | ) | 551 | |||||||||||
Inventories |
234,650 | 197,194 | 37,456 | |||||||||||||
Deferred income taxes |
40,262 | 34,957 | 5,305 | |||||||||||||
Other current assets |
42,574 | 33,089 | 9,485 | |||||||||||||
Total current assets |
900,129 | 50.8 | 933,696 | 52.0 | (33,567 | ) | ||||||||||
Non-current assets : |
||||||||||||||||
Investments and advances : |
||||||||||||||||
Investments in and advances to affiliates and unconsolidated subsidiaries |
32,219 | 24,054 | 8,165 | |||||||||||||
Securities and other investments |
443,818 | 430,096 | 13,722 | |||||||||||||
Total investments and advances |
476,037 | 26.9 | 454,150 | 25.3 | 21,887 | |||||||||||
Long-term finance receivables |
69,724 | 3.9 | 88,512 | 5.0 | (18,788 | ) | ||||||||||
Property, plant and equipment, at cost : |
||||||||||||||||
Land |
54,702 | 54,867 | (165 | ) | ||||||||||||
Buildings |
223,734 | 217,216 | 6,518 | |||||||||||||
Machinery and equipment |
646,393 | 622,721 | 23,672 | |||||||||||||
Construction in progress |
12,004 | 10,384 | 1,620 | |||||||||||||
Less accumulated depreciation |
(679,852 | ) | (650,668 | ) | (29,184 | ) | ||||||||||
256,981 | 14.5 | 254,520 | 14.2 | 2,461 | ||||||||||||
Goodwill |
27,738 | 1.6 | 25,254 | 1.4 | 2,484 | |||||||||||
Intangible assets |
16,739 | 1.0 | 16,645 | 0.9 | 94 | |||||||||||
Other assets |
23,227 | 1.3 | 21,981 | 1.2 | 1,246 | |||||||||||
Total non-current assets |
870,446 | 49.2 | 861,062 | 48.0 | 9,384 | |||||||||||
Total assets |
¥ | 1,770,575 | 100.0 | ¥ | 1,794,758 | 100.0 | ¥ | (24,183 | ) | |||||||
- 14 -
Yen in millions |
||||||||||||||||
(Unaudited) December 31, 2004 |
March 31, 2004 |
Increase (Decrease) |
||||||||||||||
Amount |
% |
Amount |
% |
|||||||||||||
Current liabilities : |
||||||||||||||||
Short-term borrowings |
¥ | 78,773 | ¥ | 84,815 | ¥ | (6,042 | ) | |||||||||
Current portion of long-term debt |
3,943 | 44,522 | (40,579 | ) | ||||||||||||
Trade notes and accounts payable |
101,354 | 110,759 | (9,405 | ) | ||||||||||||
Other notes and accounts payable |
35,867 | 38,115 | (2,248 | ) | ||||||||||||
Accrued payroll and bonus |
26,726 | 34,161 | (7,435 | ) | ||||||||||||
Accrued income taxes |
21,220 | 19,054 | 2,166 | |||||||||||||
Other accrued liabilities |
30,199 | 28,665 | 1,534 | |||||||||||||
Other current liabilities |
22,813 | 16,548 | 6,265 | |||||||||||||
Total current liabilities |
320,895 | 18.1 | 376,639 | 21.0 | (55,744 | ) | ||||||||||
Non-current liabilities : |
||||||||||||||||
Long-term debt |
70,497 | 70,608 | (111 | ) | ||||||||||||
Accrued pension and severance costs |
33,662 | 38,620 | (4,958 | ) | ||||||||||||
Deferred income taxes |
91,972 | 95,498 | (3,526 | ) | ||||||||||||
Other non-current liabilities |
4,928 | 6,409 | (1,481 | ) | ||||||||||||
Total non-current liabilities |
201,059 | 11.4 | 211,135 | 11.7 | (10,076 | ) | ||||||||||
Total liabilities |
521,954 | 29.5 | 587,774 | 32.7 | (65,820 | ) | ||||||||||
Minority interests in subsidiaries |
58,477 | 3.3 | 53,238 | 3.0 | 5,239 | |||||||||||
Stockholders equity : |
||||||||||||||||
Common stock |
115,703 | 115,703 | | |||||||||||||
Additional paid-in capital |
162,086 | 162,091 | (5 | ) | ||||||||||||
Retained earnings |
931,176 | 885,262 | 45,914 | |||||||||||||
Accumulated other comprehensive income |
12,525 | 22,046 | (9,521 | ) | ||||||||||||
Treasury stock, at cost |
(31,346 | ) | (31,356 | ) | 10 | |||||||||||
Total stockholders equity |
1,190,144 | 67.2 | 1,153,746 | 64.3 | 36,398 | |||||||||||
Total liabilities, minority interests and stockholders equity |
¥ | 1,770,575 | 100.0 | ¥ | 1,794,758 | 100.0 | ¥ | (24,183 | ) | |||||||
Note : Accumulated other comprehensive income is as follows:
|
||||||||||||||||
Yen in millions |
||||||||||||||||
December 31, 2004 |
March 31, 2004 |
|||||||||||||||
Net unrealized gains on securities |
¥48,517 | ¥59,241 | ||||||||||||||
Net unrealized gains and losses on derivative financial instruments |
¥27 | ¥(48) | ||||||||||||||
Minimum pension liability adjustments |
¥(1,477) | ¥(1,477) | ||||||||||||||
Foreign currency translation adjustments |
¥(34,542) | ¥(35,670) |
- 15 -
CONSOLIDATED STATEMENTS OF INCOME (Unaudited)
Yen in millions and shares in thousands, except per share amounts | ||||||||||||||||||||
Nine months ended December 31, |
||||||||||||||||||||
2004 |
2003 |
Increase (Decrease) | ||||||||||||||||||
Amount |
% |
Amount |
% |
Amount |
% | |||||||||||||||
Net sales |
¥ | 892,642 | 100.0 | ¥ | 815,832 | 100.0 | ¥ | 76,810 | 9.4 | |||||||||||
Cost of sales |
643,445 | 72.1 | 616,580 | 75.6 | 26,865 | 4.4 | ||||||||||||||
Gross profit |
249,197 | 27.9 | 199,252 | 24.4 | 49,945 | 25.1 | ||||||||||||||
Selling, general and administrative expenses |
167,798 | 18.8 | 150,774 | 18.5 | 17,024 | 11.3 | ||||||||||||||
Profit from operations |
81,399 | 9.1 | 48,478 | 5.9 | 32,921 | 67.9 | ||||||||||||||
Other income (expenses) : |
||||||||||||||||||||
Interest and dividend income |
5,430 | 0.6 | 4,229 | 0.5 | 1,201 | 28.4 | ||||||||||||||
Interest expense |
(927 | ) | (0.1 | ) | (938 | ) | (0.1 | ) | 11 | | ||||||||||
Foreign currency transaction gains (losses), net |
1,933 | 0.2 | (1,155 | ) | (0.1 | ) | 3,088 | | ||||||||||||
Equity in (losses) earnings of affiliates and unconsolidated subsidiaries |
(213 | ) | (0.0 | ) | 1,848 | 0.2 | (2,061 | ) | | |||||||||||
Other, net |
1,343 | 0.2 | 1,236 | 0.2 | 107 | 8.7 | ||||||||||||||
Total other income (expenses) |
7,566 | 0.9 | 5,220 | 0.7 | 2,346 | 44.9 | ||||||||||||||
Income before income taxes, minority interests |
88,965 | 10.0 | 53,698 | 6.6 | 35,267 | 65.7 | ||||||||||||||
Income taxes |
29,843 | 3.4 | 23,732 | 2.9 | 6,111 | 25.8 | ||||||||||||||
Income before minority interests |
59,122 | 6.6 | 29,966 | 3.7 | 29,156 | 97.3 | ||||||||||||||
Minority interests |
(1,959 | ) | (0.2 | ) | 3,288 | 0.4 | (5,247 | ) | | |||||||||||
Net income |
¥ | 57,163 | 6.4 | ¥ | 33,254 | 4.1 | ¥ | 23,909 | 71.9 | |||||||||||
Earnings per share : |
||||||||||||||||||||
Basic |
¥ | 304.88 | ¥ | 178.44 | ||||||||||||||||
Diluted |
¥ | 304.80 | ¥ | 178.44 | ||||||||||||||||
Weighted average number of shares of common stock outstanding : |
||||||||||||||||||||
Basic |
187,491 | 186,362 | ||||||||||||||||||
Diluted |
187,544 | 186,362 |
- 16 -
Notes:
1. | Kyocera applies SFAS No. 130, Financial Reporting of Comprehensive Income. Based on this standard, comprehensive income for the nine months ended December 31, 2004 and 2003 were an increase of 47,642 million yen and an increase of 110,148 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. |
- 17 -
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, 2003 (184,964) |
¥ | 115,703 | ¥ | 167,675 | ¥ | 828,350 | ¥ | (56,194 | ) | ¥ | (52,034 | ) | |||||||||||
Net income for the year |
68,086 | ¥ | 68,086 | ||||||||||||||||||||
Other comprehensive income for the year |
78,240 | 78,240 | |||||||||||||||||||||
Total comprehensive income for the year |
¥ | 146,326 | |||||||||||||||||||||
Cash dividends |
(11,174 | ) | |||||||||||||||||||||
Purchase of treasury stock (14) |
(105 | ) | |||||||||||||||||||||
Reissuance of treasury stock (5) |
4 | 44 | |||||||||||||||||||||
Allocation of treasury stock for share |
(5,607 | ) | 20,739 | ||||||||||||||||||||
Stock option plan of a subsidiary |
19 | ||||||||||||||||||||||
Balance, March 31, 2004 (187,484) |
115,703 | 162,091 | 885,262 | 22,046 | (31,356 | ) | |||||||||||||||||
(Unaudited) |
|||||||||||||||||||||||
Net income for the period |
57,163 | ¥ | 57,163 | ||||||||||||||||||||
Other comprehensive income for the period |
(9,521 | ) | (9,521 | ) | |||||||||||||||||||
Total comprehensive income for the period |
¥ | 47,642 | |||||||||||||||||||||
Cash dividends |
(11,249 | ) | |||||||||||||||||||||
Purchase of treasury stock (16) |
(134 | ) | |||||||||||||||||||||
Reissuance of treasury stock (17) |
(5 | ) | 144 | ||||||||||||||||||||
Balance, December 31, 2004 (187,485) |
¥ | 115,703 | ¥ | 162,086 | ¥ | 931,176 | ¥ | 12,525 | ¥ | (31,346 | ) | ||||||||||||
(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, 2003 (184,964) |
¥ | 115,703 | ¥ | 167,675 | ¥ | 828,350 | ¥ | (56,194 | ) | ¥ | (52,034 | ) | |||||||||||
(Unaudited) |
|||||||||||||||||||||||
Net income for the period |
33,254 | ¥ | 33,254 | ||||||||||||||||||||
Other comprehensive income for the period |
76,894 | 76,894 | |||||||||||||||||||||
Total comprehensive income for the period |
¥ | 110,148 | |||||||||||||||||||||
Cash dividends |
(11,174 | ) | |||||||||||||||||||||
Purchase of treasury stock (10) |
(72 | ) | |||||||||||||||||||||
Reissuance of treasury stock (1) |
5 | 9 | |||||||||||||||||||||
Allocation of treasury stock for share |
(5,607 | ) | 20,739 | ||||||||||||||||||||
Balance, December 31, 2003 (187,484) |
¥ | 115,703 | ¥ | 162,073 | ¥ | 850,430 | ¥ | 20,700 | ¥ | (31,358 | ) | ||||||||||||
- 18 -
CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)
Yen in millions |
||||||||
Nine months ended December 31, |
||||||||
2004 |
2003 |
|||||||
Cash flows from operating activities: |
||||||||
Net income |
¥ | 57,163 | ¥ | 33,254 | ||||
Adjustments to reconcile net income to net cash provided by (used in) operating activities : |
||||||||
Depreciation and amortization |
48,503 | 51,523 | ||||||
Losses of inventories |
10,397 | 8,936 | ||||||
Foreign currency adjustments |
(2,053 | ) | 700 | |||||
Decrease (increase) in receivables |
54,834 | (39,983 | ) | |||||
Increase in inventories |
(47,635 | ) | (25,684 | ) | ||||
Increase in other current assets |
(745 | ) | (3,904 | ) | ||||
(Decrease) increase in notes and accounts payable |
(11,896 | ) | 13,417 | |||||
Settlement regarding LaPine Case |
| (35,454 | ) | |||||
Other, net |
(7,004 | ) | (5,853 | ) | ||||
Net cash provided by (used in) operating activities |
101,564 | (3,048 | ) | |||||
Cash flows from investing activities : |
||||||||
Payments for purchases of securities |
(67,230 | ) | (29,195 | ) | ||||
Payments for purchases of investments and advances |
(19,524 | ) | (7,410 | ) | ||||
Sales and maturities of securities |
23,794 | 54,009 | ||||||
Payments for purchases of property, plant and equipment, and intangible assets |
(48,384 | ) | (42,362 | ) | ||||
Proceeds from sales of property, plant and equipment, and intangible assets |
3,398 | 1,665 | ||||||
Acquisitions of businesses, net of cash acquired |
(2,794 | ) | 5,135 | |||||
Deposit of negotiable certificate of deposits and time deposits |
(110,777 | ) | | |||||
Withdrawal of negotiable certificate of deposits and time deposits |
76,387 | 79 | ||||||
Deposit of restricted cash |
| (1,994 | ) | |||||
Withdrawal of restricted cash |
| 52,983 | ||||||
Other, net |
335 | (3,355 | ) | |||||
Net cash (used in) provided by investing activities |
(144,795 | ) | 29,555 | |||||
Cash flows from financing activities : |
||||||||
(Decrease) increase in short-term debt |
(6,265 | ) | 16,720 | |||||
Proceeds from issuance of long-term debt |
8,959 | 1,265 | ||||||
Payments of long-term debt |
(49,635 | ) | (19,134 | ) | ||||
Dividends paid |
(12,333 | ) | (11,910 | ) | ||||
Other, net |
1,255 | 166 | ||||||
Net cash used in financing activities |
(58,019 | ) | (12,893 | ) | ||||
Effect of exchange rate changes on cash and cash equivalents |
1,338 | (7,740 | ) | |||||
Net (decrease) increase in cash and cash equivalents |
(99,912 | ) | 5,874 | |||||
Cash and cash equivalents at beginning of period |
361,132 | 298,310 | ||||||
Cash and cash equivalents at end of period |
¥ | 261,220 | ¥ | 304,184 | ||||
- 19 -
SEGMENT INFORMATION (Unaudited)
1. Operating segments :
Yen in millions |
|||||||||||||||
Nine months ended December 31, |
|||||||||||||||
2004 |
2003 |
Increase (Decrease) |
|||||||||||||
Amount |
Amount |
Amount |
% |
||||||||||||
Net sales : |
|||||||||||||||
Fine Ceramics Group |
¥ | 224,767 | ¥ | 186,519 | ¥ | 38,248 | 20.5 | ||||||||
Electronic Device Group |
202,253 | 188,151 | 14,102 | 7.5 | |||||||||||
Equipment Group |
399,850 | 384,026 | 15,824 | 4.1 | |||||||||||
Others |
84,082 | 69,796 | 14,286 | 20.5 | |||||||||||
Adjustments and eliminations |
(18,310 | ) | (12,660 | ) | (5,650 | ) | | ||||||||
¥ | 892,642 | ¥ | 815,832 | ¥ | 76,810 | 9.4 | |||||||||
Operating profit : |
|||||||||||||||
Fine Ceramics Group |
¥ | 34,789 | ¥ | 19,606 | ¥ | 15,183 | 77.4 | ||||||||
Electronic Device Group |
29,053 | (1,187 | ) | 30,240 | | ||||||||||
Equipment Group |
5,842 | 18,382 | (12,540 | ) | (68.2 | ) | |||||||||
Others |
8,743 | 7,298 | 1,445 | 19.8 | |||||||||||
78,427 | 44,099 | 34,328 | 77.8 | ||||||||||||
Corporate |
10,651 | 7,267 | 3,384 | 46.6 | |||||||||||
Equity in (losses) earnings of affiliates and unconsolidated subsidiaries |
(213 | ) | 1,848 | (2,061 | ) | | |||||||||
Adjustments and eliminations |
100 | 484 | (384 | ) | (79.3 | ) | |||||||||
Income before income taxes |
¥ | 88,965 | ¥ | 53,698 | ¥ | 35,267 | 65.7 | ||||||||
Depreciation and amortization : |
|||||||||||||||
Fine Ceramics Group |
¥ | 12,337 | ¥ | 12,077 | ¥ | 260 | 2.2 | ||||||||
Electronic Device Group |
15,910 | 17,264 | (1,354 | ) | (7.8 | ) | |||||||||
Equipment Group |
14,765 | 16,775 | (2,010 | ) | (12.0 | ) | |||||||||
Others |
3,585 | 3,443 | 142 | 4.1 | |||||||||||
Corporate |
1,906 | 1,964 | (58 | ) | (3.0 | ) | |||||||||
¥ | 48,503 | ¥ | 51,523 | ¥ | (3,020 | ) | (5.9 | ) | |||||||
Capital expenditures : |
|||||||||||||||
Fine Ceramics Group |
¥ | 15,091 | ¥ | 9,128 | ¥ | 5,963 | 65.3 | ||||||||
Electronic Device Group |
14,757 | 13,302 | 1,455 | 10.9 | |||||||||||
Equipment Group |
12,875 | 14,234 | (1,359 | ) | (9.5 | ) | |||||||||
Others |
1,729 | 709 | 1,020 | 143.9 | |||||||||||
Corporate |
1,750 | 3,211 | (1,461 | ) | (45.5 | ) | |||||||||
¥ | 46,202 | ¥ | 40,584 | ¥ | 5,618 | 13.8 | |||||||||
- 20 -
2. Geographic segments (Sales and Operating profits by geographic area) :
Yen in millions |
|||||||||||||||
Nine months ended December 31, |
|||||||||||||||
2004 |
2003 |
Increase (Decrease) |
|||||||||||||
Amount |
Amount |
Amount |
% |
||||||||||||
Net sales: |
|||||||||||||||
Japan |
¥ | 389,127 | ¥ | 370,449 | ¥ | 18,678 | 5.0 | ||||||||
Intra-group sales and transfer between geographic areas |
241,985 | 204,908 | 37,077 | 18.1 | |||||||||||
631,112 | 575,357 | 55,755 | 9.7 | ||||||||||||
United States of America |
243,200 | 221,515 | 21,685 | 9.8 | |||||||||||
Intra-group sales and transfer between geographic areas |
20,071 | 16,516 | 3,555 | 21.5 | |||||||||||
263,271 | 238,031 | 25,240 | 10.6 | ||||||||||||
Asia |
112,940 | 95,042 | 17,898 | 18.8 | |||||||||||
Intra-group sales and transfer between geographic areas |
91,049 | 75,035 | 16,014 | 21.3 | |||||||||||
203,989 | 170,077 | 33,912 | 19.9 | ||||||||||||
Europe |
132,956 | 115,038 | 17,918 | 15.6 | |||||||||||
Intra-group sales and transfer between geographic areas |
22,790 | 24,184 | (1,394 | ) | (5.8 | ) | |||||||||
155,746 | 139,222 | 16,524 | 11.9 | ||||||||||||
Others |
14,419 | 13,788 | 631 | 4.6 | |||||||||||
Intra-group sales and transfer between geographic areas |
5,805 | 5,562 | 243 | 4.4 | |||||||||||
20,224 | 19,350 | 874 | 4.5 | ||||||||||||
Adjustments and eliminations |
(381,700 | ) | (326,205 | ) | (55,495 | ) | | ||||||||
¥ | 892,642 | ¥ | 815,832 | ¥ | 76,810 | 9.4 | |||||||||
Operating Profits : |
|||||||||||||||
Japan |
¥ | 70,459 | ¥ | 58,084 | ¥ | 12,375 | 21.3 | ||||||||
United States of America |
5,482 | (1,461 | ) | 6,943 | | ||||||||||
Asia |
11,152 | 6,686 | 4,466 | 66.8 | |||||||||||
Europe |
(798 | ) | (14,943 | ) | 14,145 | | |||||||||
Others |
1,017 | 751 | 266 | 35.4 | |||||||||||
87,312 | 49,117 | 38,195 | 77.8 | ||||||||||||
Adjustments and eliminations |
(8,785 | ) | (4,534 | ) | (4,251 | ) | | ||||||||
78,527 | 44,583 | 33,944 | 76.1 | ||||||||||||
Corporate |
10,651 | 7,267 | 3,384 | 46.6 | |||||||||||
Equity in (losses) earnings of affiliates and unconsolidated subsidiaries |
(213 | ) | 1,848 | (2,061 | ) | | |||||||||
Income before income taxes |
¥ | 88,965 | ¥ | 53,698 | ¥ | 35,267 | 65.7 | ||||||||
- 21 -
3. Geographic segments (Sales by region) :
Yen in millions | |||||||||||||||||
Nine months ended December 31, |
|||||||||||||||||
2004 |
2003 |
Increase (Decrease) | |||||||||||||||
Amount |
% |
Amount |
% |
Amount |
% | ||||||||||||
Japan |
¥ | 346,163 | 38.8 | ¥ | 325,931 | 40.0 | ¥ | 20,232 | 6.2 | ||||||||
United States of America |
192,153 | 21.5 | 178,622 | 21.9 | 13,531 | 7.6 | |||||||||||
Asia |
159,994 | 17.9 | 142,132 | 17.4 | 17,862 | 12.6 | |||||||||||
Europe |
129,256 | 14.5 | 112,429 | 13.8 | 16,827 | 15.0 | |||||||||||
Others |
65,076 | 7.3 | 56,718 | 6.9 | 8,358 | 14.7 | |||||||||||
Net sales |
¥ | 892,642 | 100.0 | ¥ | 815,832 | 100.0 | ¥ | 76,810 | 9.4 | ||||||||
Sales outside Japan |
¥ | 546,479 | ¥ | 489,901 | ¥ | 56,578 | 11.5 | ||||||||||
Sales outside Japan to net sales |
61.2 | % | 60.0 | % |
- 22 -
CONSOLIDATED BALANCE SHEETS (Unaudited)
Yen in millions |
||||||||||||||||
December 31, 2004 |
September 30, 2004 |
Increase (Decrease) |
||||||||||||||
Amount |
% |
Amount |
% |
|||||||||||||
Current assets : |
||||||||||||||||
Cash and cash equivalents |
¥ | 261,220 | ¥ | 256,965 | ¥ | 4,255 | ||||||||||
Short-term investments |
49,789 | 74,262 | (24,473 | ) | ||||||||||||
Trade notes receivable |
33,360 | 33,549 | (189 | ) | ||||||||||||
Trade accounts receivable |
206,239 | 211,504 | (5,265 | ) | ||||||||||||
Short-term finance receivables |
39,952 | 42,820 | (2,868 | ) | ||||||||||||
Less allowances for doubtful accounts and sales returns |
(7,917 | ) | (7,569 | ) | (348 | ) | ||||||||||
Inventories |
234,650 | 239,612 | (4,962 | ) | ||||||||||||
Deferred income taxes |
40,262 | 39,408 | 854 | |||||||||||||
Other current assets |
42,574 | 31,207 | 11,367 | |||||||||||||
Total current assets |
900,129 | 50.8 | 921,758 | 51.6 | (21,629 | ) | ||||||||||
Non-current assets : |
||||||||||||||||
Investments and advances : |
||||||||||||||||
Investments in and advances to affiliates and unconsolidated subsidiaries |
32,219 | 24,240 | 7,979 | |||||||||||||
Securities and other investments |
443,818 | 440,844 | 2,974 | |||||||||||||
Total investments and advances |
476,037 | 26.9 | 465,084 | 26.0 | 10,953 | |||||||||||
Long-term finance receivables |
69,724 | 3.9 | 73,477 | 4.1 | (3,753 | ) | ||||||||||
Property, plant and equipment, at cost : |
||||||||||||||||
Land |
54,702 | 55,021 | (319 | ) | ||||||||||||
Buildings |
223,734 | 223,956 | (222 | ) | ||||||||||||
Machinery and equipment |
646,393 | 642,657 | 3,736 | |||||||||||||
Construction in progress |
12,004 | 9,815 | 2,189 | |||||||||||||
Less accumulated depreciation |
(679,852 | ) | (675,190 | ) | (4,662 | ) | ||||||||||
256,981 | 14.5 | 256,259 | 14.4 | 722 | ||||||||||||
Goodwill |
27,738 | 1.6 | 28,589 | 1.6 | (851 | ) | ||||||||||
Intangible assets |
16,739 | 1.0 | 17,495 | 1.0 | (756 | ) | ||||||||||
Other assets |
23,227 | 1.3 | 22,843 | 1.3 | 384 | |||||||||||
Total non-current assets |
870,446 | 49.2 | 863,747 | 48.4 | 6,699 | |||||||||||
¥ | 1,770,575 | 100.0 | ¥ | 1,785,505 | 100.0 | ¥ | (14,930 | ) | ||||||||
- 23 -
Yen in millions |
||||||||||||||||
December 31, 2004 |
September 30, 2004 |
Increase (Decrease) |
||||||||||||||
Amount |
% |
Amount |
% |
|||||||||||||
Current liabilities : |
||||||||||||||||
Short-term borrowings |
¥ | 78,773 | ¥ | 78,044 | ¥ | 729 | ||||||||||
Current portion of long-term debt |
3,943 | 4,406 | (463 | ) | ||||||||||||
Trade notes and accounts payable |
101,354 | 120,646 | (19,292 | ) | ||||||||||||
Other notes and accounts payable |
35,867 | 36,232 | (365 | ) | ||||||||||||
Accrued payroll and bonus |
26,726 | 35,725 | (8,999 | ) | ||||||||||||
Accrued income taxes |
21,220 | 23,641 | (2,421 | ) | ||||||||||||
Other accrued liabilities |
30,199 | 30,029 | 170 | |||||||||||||
Other current liabilities |
22,813 | 17,223 | 5,590 | |||||||||||||
Total current liabilities |
320,895 | 18.1 | 345,946 | 19.4 | (25,051 | ) | ||||||||||
Non-current liabilities : |
||||||||||||||||
Long-term debt |
70,497 | 70,743 | (246 | ) | ||||||||||||
Accrued pension and severance costs |
33,662 | 36,929 | (3,267 | ) | ||||||||||||
Deferred income taxes |
91,972 | 86,387 | 5,585 | |||||||||||||
Other non-current liabilities |
4,928 | 5,386 | (458 | ) | ||||||||||||
Total non-current liabilities |
201,059 | 11.4 | 199,445 | 11.2 | 1,614 | |||||||||||
Total liabilities |
521,954 | 29.5 | 545,391 | 30.6 | (23,437 | ) | ||||||||||
Minority interests in subsidiaries |
58,477 | 3.3 | 59,173 | 3.3 | (696 | ) | ||||||||||
Stockholders equity : |
||||||||||||||||
Common stock |
115,703 | 115,703 | | |||||||||||||
Additional paid-in capital |
162,086 | 162,087 | (1 | ) | ||||||||||||
Retained earnings |
931,176 | 922,187 | 8,989 | |||||||||||||
Accumulated other comprehensive income |
12,525 | 12,262 | 263 | |||||||||||||
Treasury stock, at cost |
(31,346 | ) | (31,298 | ) | (48 | ) | ||||||||||
Total stockholders equity |
1,190,144 | 67.2 | 1,180,941 | 66.1 | 9,203 | |||||||||||
Total liabilities, minority interests and stockholders equity |
¥ | 1,770,575 | 100.0 | ¥ | 1,785,505 | 100.0 | ¥ | (14,930 | ) | |||||||
Note: Accumulated other comprehensive income is as follows:
|
||||||||||||||||
Yen in millions |
||||||||||||||||
December 31, 2004 |
September 30, 2004 |
|||||||||||||||
Net unrealized gains on securities |
¥48,517 | ¥39,996 | ||||||||||||||
Net unrealized gains (losses) on derivative financial instruments |
¥27 | ¥(22) | ||||||||||||||
Minimum pension liability adjustments |
¥(1,477) | ¥(1,477) | ||||||||||||||
Foreign currency translation adjustments |
¥(34,542) | ¥(26,235) |
- 24 -
CONSOLIDATED STATEMENTS OF INCOME (Unaudited)
Yen in millions and shares in thousands, except per share amounts |
|||||||||||||||||||||
Three months ended December 31, |
Increase | ||||||||||||||||||||
2004 |
2003 |
(Decrease) |
|||||||||||||||||||
Amount |
% |
Amount |
% |
Amount |
% |
||||||||||||||||
Net sales |
¥ | 292,080 | 100.0 | ¥ | 297,454 | 100.0 | ¥ | (5,374 | ) | (1.8 | ) | ||||||||||
Cost of sales |
213,802 | 73.2 | 218,926 | 73.6 | (5,124 | ) | (2.3 | ) | |||||||||||||
Gross profit |
78,278 | 26.8 | 78,528 | 26.4 | (250 | ) | (0.3 | ) | |||||||||||||
Selling, general and administrative expenses |
58,971 | 20.2 | 52,604 | 17.7 | 6,367 | 12.1 | |||||||||||||||
Profit from operations |
19,307 | 6.6 | 25,924 | 8.7 | (6,617 | ) | (25.5 | ) | |||||||||||||
Other income (expenses) : |
|||||||||||||||||||||
Interest and dividend income |
2,702 | 0.9 | 1,810 | 0.6 | 892 | 49.3 | |||||||||||||||
Interest expense |
(314 | ) | (0.1 | ) | (237 | ) | (0.1 | ) | (77 | ) | | ||||||||||
Foreign currency transaction (losses) gains, net |
(163 | ) | (0.0 | ) | 466 | 0.2 | (629 | ) | | ||||||||||||
Equity in (losses) earnings of affiliates and unconsolidated subsidiaries |
(795 | ) | (0.3 | ) | 119 | 0.0 | (914 | ) | | ||||||||||||
Other, net |
975 | 0.3 | 489 | 0.2 | 486 | 99.4 | |||||||||||||||
Total other income (expenses) |
2,405 | 0.8 | 2,647 | 0.9 | (242 | ) | (9.1 | ) | |||||||||||||
Income before income taxes, minority interests |
21,712 | 7.4 | 28,571 | 9.6 | (6,859 | ) | (24.0 | ) | |||||||||||||
Income taxes |
7,095 | 2.4 | 10,983 | 3.7 | (3,888 | ) | (35.4 | ) | |||||||||||||
Income before minority interests |
14,617 | 5.0 | 17,588 | 5.9 | (2,971 | ) | (16.9 | ) | |||||||||||||
Minority interests |
(3 | ) | (0.0 | ) | (88 | ) | (0.0 | ) | 85 | | |||||||||||
Net income |
¥ | 14,614 | 5.0 | ¥ | 17,500 | 5.9 | ¥ | (2,886 | ) | (16.5 | ) | ||||||||||
Earnings per share : |
|||||||||||||||||||||
Basic |
¥ | 77.94 | ¥ | 93.34 | |||||||||||||||||
Diluted |
¥ | 77.94 | ¥ | 93.34 | |||||||||||||||||
Weighted average number of shares of common stock outstanding : |
|||||||||||||||||||||
Basic |
187,488 | 187,482 | |||||||||||||||||||
Diluted |
187,492 | 187,482 |
- 25 -
Notes:
1. | Kyocera applies SFAS No.130, Financial Reporting of Comprehensive Income. Based on this standard, comprehensive income for the three months ended December 31, 2004 and 2003 were an increase of 14,877 million yen and an increase of 30,757 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. |
- 26 -
CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)
Yen in millions |
||||||||
Three months ended December 31, |
||||||||
2004 |
2003 |
|||||||
Cash flows from operating activities: |
||||||||
Net income |
¥ | 14,614 | ¥ | 17,500 | ||||
Adjustments to reconcile net income to net cash provided by (used in) operating activities : |
||||||||
Depreciation and amortization |
17,414 | 17,856 | ||||||
Losses of inventories |
2,904 | (402 | ) | |||||
Foreign currency adjustments |
(204 | ) | (608 | ) | ||||
Decrease (increase) in receivables |
4,562 | (42,279 | ) | |||||
Increase in inventories |
(3,311 | ) | (3,625 | ) | ||||
(Increase) decrease in other current assets |
(356 | ) | 911 | |||||
(Decrease) increase in notes and accounts payable |
(15,118 | ) | 7,791 | |||||
Settlement regarding LaPine Case |
| (35,454 | ) | |||||
Other, net |
(7,832 | ) | 6,752 | |||||
Net cash provided by (used in) operating activities |
12,673 | (31,558 | ) | |||||
Cash flows from investing activities : |
||||||||
Payments for purchases of securities |
(6,890 | ) | (6,563 | ) | ||||
Payments for purchases of investments and advances |
(19,072 | ) | (6,804 | ) | ||||
Sales and maturities of securities |
3,865 | 11,651 | ||||||
Payments for purchases of property, plant and equipment, and intangible assets |
(17,810 | ) | (13,234 | ) | ||||
Proceeds from sales of property, plant and equipment, and intangible assets |
1,416 | 542 | ||||||
Deposit of negotiable certificate of deposits and time deposits |
(38,177 | ) | | |||||
Withdrawal of negotiable certificate of deposits and time deposits |
75,871 | | ||||||
Withdrawal of restricted cash |
| 52,983 | ||||||
Other, net |
179 | (3,857 | ) | |||||
Net cash (used in) provided by investing activities |
(618 | ) | 34,718 | |||||
Cash flows from financing activities : |
||||||||
Increase in short-term debt |
782 | 10,019 | ||||||
Proceeds from issuance of long-term debt |
297 | 97 | ||||||
Payments of long-term debt |
(788 | ) | (773 | ) | ||||
Dividends paid |
(5,924 | ) | (5,796 | ) | ||||
Other, net |
1,196 | (328 | ) | |||||
Net cash (used in) provided by financing activities |
(4,437 | ) | 3,219 | |||||
Effect of exchange rate changes on cash and cash equivalents |
(3,363 | ) | (1,355 | ) | ||||
Net increase in cash and cash equivalents |
4,255 | 5,024 | ||||||
Cash and cash equivalents at beginning of period |
256,965 | 299,160 | ||||||
Cash and cash equivalents at end of period |
¥ | 261,220 | ¥ | 304,184 | ||||
- 27 -
SEGMENT INFORMATION (Unaudited)
1. Operating segments :
Yen in millions |
|||||||||||||||
Three months ended December 31, |
|||||||||||||||
2004 |
2003 |
Increase (Decrease) |
|||||||||||||
Amount |
Amount |
Amount |
% |
||||||||||||
Net sales : |
|||||||||||||||
Fine Ceramics Group |
¥ | 72,781 | ¥ | 67,120 | ¥ | 5,661 | 8.4 | ||||||||
Electronic Device Group |
62,463 | 68,364 | (5,901 | ) | (8.6 | ) | |||||||||
Equipment Group |
134,253 | 142,654 | (8,401 | ) | (5.9 | ) | |||||||||
Others |
27,889 | 24,061 | 3,828 | 15.9 | |||||||||||
Adjustments and eliminations |
(5,306 | ) | (4,745 | ) | (561 | ) | | ||||||||
¥ | 292,080 | ¥ | 297,454 | ¥ | (5,374 | ) | (1.8 | ) | |||||||
Operating profit : |
|||||||||||||||
Fine Ceramics Group |
¥ | 10,390 | ¥ | 8,284 | ¥ | 2,106 | 25.4 | ||||||||
Electronic Device Group |
6,812 | 5,205 | 1,607 | 30.9 | |||||||||||
Equipment Group |
(1,294 | ) | 8,108 | (9,402 | ) | | |||||||||
Others |
2,583 | 2,543 | 40 | 1.6 | |||||||||||
18,491 | 24,140 | (5,649 | ) | (23.4 | ) | ||||||||||
Corporate |
3,968 | 4,257 | (289 | ) | (6.8 | ) | |||||||||
Equity in (losses) earnings of affiliates and unconsolidated subsidiaries |
(795 | ) | 119 | (914 | ) | | |||||||||
Adjustments and eliminations |
48 | 55 | (7 | ) | (12.7 | ) | |||||||||
Income before income taxes |
¥ | 21,712 | ¥ | 28,571 | ¥ | (6,859 | ) | (24.0 | ) | ||||||
Depreciation and amortization : |
|||||||||||||||
Fine Ceramics Group |
¥ | 4,454 | ¥ | 4,302 | ¥ | 152 | 3.5 | ||||||||
Electronic Device Group |
5,776 | 5,971 | (195 | ) | (3.3 | ) | |||||||||
Equipment Group |
5,305 | 5,796 | (491 | ) | (8.5 | ) | |||||||||
Others |
1,222 | 1,167 | 55 | 4.7 | |||||||||||
Corporate |
657 | 620 | 37 | 6.0 | |||||||||||
¥ | 17,414 | ¥ | 17,856 | ¥ | (442 | ) | (2.5 | ) | |||||||
Capital expenditures : |
|||||||||||||||
Fine Ceramics Group |
¥ | 7,762 | ¥ | 3,301 | ¥ | 4,461 | 135.1 | ||||||||
Electronic Device Group |
4,437 | 4,191 | 246 | 5.9 | |||||||||||
Equipment Group |
3,917 | 5,230 | (1,313 | ) | (25.1 | ) | |||||||||
Others |
815 | 188 | 627 | 333.5 | |||||||||||
Corporate |
640 | 216 | 424 | 196.3 | |||||||||||
¥ | 17,571 | ¥ | 13,126 | ¥ | 4,445 | 33.9 | |||||||||
- 28 -
2. Geographic segments (Sales and Operating profits by geographic area) :
Yen in millions |
|||||||||||||||
Three months ended December 31, |
|||||||||||||||
2004 |
2003 |
Increase (Decrease) |
|||||||||||||
Amount |
Amount |
Amount |
% |
||||||||||||
Net sales: |
|||||||||||||||
Japan |
¥ | 129,527 | ¥ | 130,398 | ¥ | (871 | ) | (0.7 | ) | ||||||
Intra-group sales and transfer between geographic areas |
77,765 | 70,570 | 7,195 | 10.2 | |||||||||||
207,292 | 200,968 | 6,324 | 3.1 | ||||||||||||
United States of America |
76,373 | 85,975 | (9,602 | ) | (11.2 | ) | |||||||||
Intra-group sales and transfer between geographic areas |
6,360 | 4,926 | 1,434 | 29.1 | |||||||||||
82,733 | 90,901 | (8,168 | ) | (9.0 | ) | ||||||||||
Asia |
34,266 | 36,057 | (1,791 | ) | (5.0 | ) | |||||||||
Intra-group sales and transfer between geographic areas |
31,407 | 28,551 | 2,856 | 10.0 | |||||||||||
65,673 | 64,608 | 1,065 | 1.6 | ||||||||||||
Europe |
46,668 | 40,076 | 6,592 | 16.4 | |||||||||||
Intra-group sales and transfer between geographic areas |
7,477 | 8,316 | (839 | ) | (10.1 | ) | |||||||||
54,145 | 48,392 | 5,753 | 11.9 | ||||||||||||
Others |
5,246 | 4,948 | 298 | 6.0 | |||||||||||
Intra-group sales and transfer between geographic areas |
1,884 | 2,068 | (184 | ) | (8.9 | ) | |||||||||
7,130 | 7,016 | 114 | 1.6 | ||||||||||||
Adjustments and eliminations |
(124,893 | ) | (114,431 | ) | (10,462 | ) | | ||||||||
¥ | 292,080 | ¥ | 297,454 | ¥ | (5,374 | ) | (1.8 | ) | |||||||
Operating Profits : |
|||||||||||||||
Japan |
¥ | 15,975 | ¥ | 18,710 | ¥ | (2,735 | ) | (14.6 | ) | ||||||
United States of America |
(311 | ) | 3,233 | (3,544 | ) | | |||||||||
Asia |
2,516 | 3,592 | (1,076 | ) | (30.0 | ) | |||||||||
Europe |
(100 | ) | (647 | ) | 547 | | |||||||||
Others |
277 | 335 | (58 | ) | (17.3 | ) | |||||||||
18,357 | 25,223 | (6,866 | ) | (27.2 | ) | ||||||||||
Adjustments and eliminations |
182 | (1,028 | ) | 1,210 | | ||||||||||
18,539 | 24,195 | (5,656 | ) | (23.4 | ) | ||||||||||
Corporate |
3,968 | 4,257 | (289 | ) | (6.8 | ) | |||||||||
Equity in (losses) earnings of affiliates and unconsolidated subsidiaries |
(795 | ) | 119 | (914 | ) | | |||||||||
Income before income taxes |
¥ | 21,712 | ¥ | 28,571 | ¥ | (6,859 | ) | (24.0 | ) | ||||||
- 29 -
3. Geographic segments (Sales by region) :
Yen in millions |
|||||||||||||||||||
Three months ended December 31, |
|||||||||||||||||||
2004 |
2003 |
Increase (Decrease) |
|||||||||||||||||
Amount |
% |
Amount |
% |
Amount |
% |
||||||||||||||
Japan |
¥ | 118,391 | 40.5 | ¥ | 114,655 | 38.5 | ¥ | 3,736 | 3.3 | ||||||||||
United States of America |
61,648 | 21.1 | 64,287 | 21.6 | (2,639 | ) | (4.1 | ) | |||||||||||
Asia |
43,637 | 15.0 | 52,010 | 17.5 | (8,373 | ) | (16.1 | ) | |||||||||||
Europe |
45,350 | 15.5 | 38,957 | 13.1 | 6,393 | 16.4 | |||||||||||||
Others |
23,054 | 7.9 | 27,545 | 9.3 | (4,491 | ) | (16.3 | ) | |||||||||||
Net sales |
¥ | 292,080 | 100.0 | ¥ | 297,454 | 100.0 | ¥ | (5,374 | ) | (1.8 | ) | ||||||||
Sales outside Japan |
¥ | 173,689 | ¥ | 182,799 | ¥ | (9,110 | ) | (5.0 | ) | ||||||||||
Sales outside Japan to net sales |
59.5 | % | 61.5 | % |
- 30 -
January 27, 2005
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 Transfer of
Domestic Sales Business of Solar Energy Products of Kyocera Group
Kyocera Corporation (the Company) will transfer its domestic sales business of solar energy products by means of corporate splits to Kyocera Solar Corporation (KSC), as announced on December 17, 2004. This is to advise you that the agreement for corporate split was approved at the Companys Board of Directors Meeting on January 27, 2005, as descried below.
1. | Objective of Corporate Split |
Domestic sales of Kyocera Group solar energy products is undertaken by the Company, handling sales of solar power generation systems for use by domestic public sector industries, and by KSC, a wholly owned subsidiary of the Company, handling solar power generation systems for residential use. To enhance its business in the expanding market for domestic solar power generation systems, the Company will transfer its domestic sales division for solar energy products to KSC. In addition, in order to improve materials procurement efficiency, the Company will integrate a part of its solar energy products manufacturing division, which procures peripheral components incorporated into solar power generation systems, into KSC.
2. | Outline of Corporate Split |
(1) | Schedule of Corporate Split |
Meeting of Board of Directors to approve agreement for corporate split: | January 27, 2005 | |
Execution of agreement for corporate split: | January 27, 2005 | |
General Shareholders Meeting to approve agreement for corporate sprit: | Both the Company and KSC 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, 2005 (scheduled) | |
Register of corporate split in Commercial Register: | April 1, 2005 (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 KSC, 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, in which shares issued by KSC shall be allocated to the Company, is the most suitable option for transfer of the Companys domestic sales division for solar energy products and a part of the manufacturing division relating to solar energy products to KSC, a wholly-owned subsidiary of the Company.
(3) | Allocation of Shares |
(i) | Allocation Ratio of Shares |
One share to be issued by KSC in the corporate split shall be allocated to the Company.
- 2 -
(ii) | The Basis of Calculation of Allocation Ratio |
KSC 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, KSC will succeed to all assets and liabilities of the Company 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 KSC to the Company because the amount of the difference between assets and liabilities of KSC 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 KSC have agreed that the one share of KSC 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 (KSC) |
KSC will succeed to assets and liabilities and rights and obligations belonging to the Companys domestic sales division for solar energy products and a part of the manufacturing division of solar energy products pursuant to agreements as of the effective date of the corporate split. More detailed content thereof shall be decided by the time of execution of the agreement for 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 (KSC) |
Taking into consideration the amounts of the assets, liabilities and net asset value of KSC and the amounts of assets, liabilities and net asset value, etc. to which KSC will succeed, it is judged that there will be no problem with respect to the certainty of performance by KSC of its debts.
(7) | New Directors or Corporate Auditors of the Succeeding Company (KSC) |
Not yet decided.
- 3 -
3. | Content of Business to be Divided |
(1) | Content of the domestic sales division for solar energy products and a part of the manufacturing division of solar energy products: |
Sale of solar power generation systems, procurement of peripheral components other than solar batteries, etc., which are incorporated into solar power generation systems. Quality guarantee relating thereto.
(2) | Performance of the Domestic Sales Division for Solar Energy Products of the Company for the fiscal year ended March 31, 2004: |
Net sales of the Company derived from its domestic sales division for solar energy products for the fiscal year ended March 31, 2004 were 4,391 million yen, representing 0.9% of the total net sales of the Company in the amount of 494,035 million yen for the same period.
(3) | Assets and Liabilities to be Transferred and Amounts thereof (as of December 31, 2004): |
(Millions of Yen)
Assets |
Liabilities | |||||
Item |
Book Value |
Item |
Book Value | |||
Current Assets |
448 | Current Liabilities |
103 | |||
Fixed Assets |
93 | Fixed Liabilities |
0 | |||
Total |
541 | Total |
103 |
* | As of December 31, 2004, the amount of assets to be succeeded (541 million yen) represented 0.04% of the total assets of the Company (1,247,415 million yen) as of the same date. |
4. | Outlines of Parties to the Corporate Split (as of December 31, 2004) |
(1) Name |
Kyocera Corporation |
Kyocera Solar Corporation | ||
(2) Principal Businesses |
- Fine ceramics group - Electronic device group - Equipment group - Others |
Sales, servicing and construction of solar power generating systems. | ||
(3) Date of Incorporation |
April, 1959 |
September, 1996 | ||
(4) Location of Headquarters |
Fushimi-ku, Kyoto |
Fushimi-ku, Kyoto | ||
(5) Representatives |
Yasuo Nishiguchi President and Director |
Isao Yukawa President and Director | ||
(6) Capital Amount |
115,703 million yen |
300 million yen | ||
(7) Number of Shares Issued and Outstanding |
191,309,290 shares (out of which 3,823,896 shares are treasury stock) |
6,000 shares (there is no treasury stock) | ||
(8) Shareholders Equity |
1,042,354 million yen |
1,818 million yen | ||
(9) Total Assets |
1,247,415 million yen |
6,396 million yen |
- 4 -
(10) Fiscal Year End |
March 31 |
March 31 | ||||
(11) Number of Employees |
12,585 |
222 |
(12) Principal Suppliers and Customers |
Suppliers: |
Suppliers: | ||||
Matsushita Electric Industrial Co., Ltd. Mitsui & Co., Ltd. |
Kyocera Corporation | |||||
Sony Corp. |
||||||
Customers: |
Customers: | |||||
Fujitsu Ltd. Hitachi, Ltd. NEC Corp. |
PanaHome Corporation Daiwa House Industry Co., Ltd. |
(13) Principal Shareholders and Their Shareholding Ratios |
Japan Trustee Services Bank, Ltd. (Trust Account) |
7.19% |
Kyocera Corporation 100.00% |
The Master Trust Bank of Japan, Ltd. (Trust Account) |
6.18% |
The Bank of Kyoto, Ltd. |
3.77% |
Kazuo Inamori |
3.56% |
Inamori Foundation |
2.45% |
(Shareholding ratio is as of September 30, 2004) | ||||||
(14) Principal Banks |
The Bank of Kyoto, Ltd. UFJ Bank Ltd. |
The Bank of Kyoto, Ltd. UFJ Bank Ltd. |
(15) Relationship between the Parties |
Capital Relationship |
KSC is a wholly-owned subsidiary of the Company. |
Personnel Relationship |
The Company forwards Directors, Corporate Auditors and employees to KSC. KSC seconds employees to the Company. |
Trades between the Parties |
Manufacture and development of solar power generating equipments |
- 5 -
(16) | Performance in Most Recent Three Fiscal Years |
(Millions of Yen)
Kyocera Corporation (100% parent company) |
Kyocera Solar Corporation (wholly-owned subsidiary) | |||||||||||
Fiscal Year Ended March 31, |
Fiscal Year Ended March 31, | |||||||||||
2002 |
2003 |
2004 |
2002 |
2003 |
2004 | |||||||
Net Sales |
499,264 | 482,834 | 494,035 | 941 | 1,283 | 11,784 | ||||||
Recurring Profit (or Loss) |
56,412 | 54,685 | 61,788 | 8 | 148 | 503 | ||||||
Net Income |
34,475 | 27,923 | 60,663 | 2 | 135 | 309 | ||||||
Net Income per Share |
182.36 yen | 149.45 yen | 324.70 yen | 483.73 yen | 22,512.99 yen | 51,568.70 yen | ||||||
Dividend per Share |
60.00 yen | 60.00 yen | 60.00 yen | 0 | 11,256 yen | 25,784 yen | ||||||
Shareholders Equity per Share |
4,652.07 yen | 4,676.97 yen | 5,492.08 yen | 207,771 yen | 225,961 yen | 261,952 yen |
5. | 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 |
There will be a decrease in the amount of the Companys assets in an amount equivalent to the amount of liabilities to be assumed by KSC.
(3) | Impact on Companys Performance |
The effective date of the corporate split will be April 1, 2005, 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, 2005.
- 6 -