FORM 6-K
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
REPORT OF FOREIGN PRIVATE ISSUER
Pursuant to Rule 13a-16 or 15d-16
of the Securities Exchange Act of 1934
For the month of July 2007
Commission File Number 2 - 68279
RICOH COMPANY, LTD.
-----------------------------------------------
(Translation of Registrant's name into English)
13-1, Ginza 8-Chome, Chuo-ku, Tokyo 104-8222, 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-__ )
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
Ricoh Company, Ltd.
------------------------------
(Registrant)
By: /S/ Zenji Miura
------------------------------
Zenji Miura
Director, Chief Financial Officer
Corporate Executive Vice President
July 26, 2007
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RICOH July 26, 2007
QUARTERLY REPORT
First Quarter ended June 30, 2007
(Results for the Period from April 1, 2007 to June 30, 2007)
PERFORMANCE OUTLINE (CONSOLIDATED)
(Billions of yen)
---------------------------------------------------------------------------------------------------------------------------
Three months ended Three months ended Year ending
June 30, 2006 June 30, 2007 March 31, 2008
Results Results Change Forecast Change
---------------------------------------------------------------------------------------------------------------------------
Domestic sales 240.4 244.7 1.8% 1,040.0 3.8%
Overseas sales 244.1 285.3 16.9% 1,210.0 13.4%
Net sales 484.5 530.1 9.4% 2,250.0 8.8%
Gross profit 202.5 228.7 12.9% 940.0 9.0%
Operating income 40.6 46.6 14.7% 195.0 11.8%
Income from continuing operations before
income taxes 38.7 53.2 37.6% 192.0 10.0%
Net income 29.1 33.8 16.2% 117.0 4.7%
---------------------------------------------------------------------------------------------------------------------------
Exchange rate (Yen/US$) 114.53 120.77 6.24 116.44 -0.58
Exchange rate (Yen/EURO) 143.78 162.72 18.94 156.93 6.85
---------------------------------------------------------------------------------------------------------------------------
Net income per share (yen) 39.92 46.38 6.46 160.28 7.18
Net income per share-diluted (yen) 39.92 45.15 5.23 156.03 4.14
---------------------------------------------------------------------------------------------------------------------------
Cash flows from operating activities 26.3 21.4 -4.9 -- --
Cash flows from investing activities -5.0 -107.2 -102.1 -- --
Cash flows from financing activities -17.4 -2.8 14.5 -- --
Cash and cash equivalents at end of period 189.1 171.6 -17.5 -- --
---------------------------------------------------------------------------------------------------------------------------
Capital expenditures 15.9 17.1 1.1 90.0 4.2
Depreciation for tangible fixed assets 15.9 16.8 0.9 76.0 3.5
R&D expenditures 25.3 27.2 1.8 128.0 13.0
---------------------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------
March 31, 2007 June 30, 2007 Change
-----------------------------------------------------------------------------------------
Total assets 2,243.4 2,313.5 70.1
Shareholders' equity 1,070.9 1,111.0 40.1
Interest-bearing debt 415.6 429.0 13.3
-----------------------------------------------------------------------------------------
Equity ratio (%) 47.7 48.0 0.3
-----------------------------------------------------------------------------------------
Shareholders' equity per share (yen) 1,467.03 1,522.12 55.09
-----------------------------------------------------------------------------------------
RICOH COMPANY, LTD.
* The Company bases the forecast estimates for the fiscal year ending March 31,
2008 above upon information currently available to management, which involves
risks and uncertainties that could cause actual results to differ materially
from those projected.
1
RICOH COMPANY, LTD. AND CONSOLIDATED SUBSIDIARIES
FINANCIAL HIGHLIGHTS FOR THE FIRST QUARTER ENDED JUNE 30, 2007
(U.S. GAAP FINANCIAL INFORMATION)
1 RESULTS FOR THE PERIOD FROM APRIL 1, 2007 TO JUNE 30, 2007
(1) Operating Results (Millions of yen)
-------------------------------------------------------------------------------------------------------------
Three months ended Three months ended Year ended
June 30, 2006 June 30, 2007 March 31, 2007
-------------------------------------------------------------------------------------------------------------
Net sales 484,576 530,113 2,068,925
(% change from the previous corresponding period) 7.3 9.4 --
Operating income 40,647 46,616 174,380
(% change from the previous corresponding period) 11.7 14.7 --
Income from continuing operations before income taxes 38,704 53,264 174,519
(% change from the previous corresponding period) 4.0 37.6 --
Net income 29,125 33,855 111,724
(% change from the previous corresponding period) 22.8 16.2 --
Net income per share-basic (yen) 39.92 46.38 153.10
Net income per share-diluted (yen) 39.92 45.15 151.89
-------------------------------------------------------------------------------------------------------------
(2) Financial Position (Millions of yen)
-------------------------------------------------------------------------------------------------------------
June 30, 2006 June 30, 2007 March 31, 2007
-------------------------------------------------------------------------------------------------------------
Total assets 2,048,349 2,313,588 2,243,406
Shareholders' Investment 973,758 1,111,025 1,070,913
Equity ratio (%) 47.5 48.0 47.7
Equity per share (yen) 1,334.83 1,522.12 1,467.03
-------------------------------------------------------------------------------------------------------------
(3) Cash Flows (Millions of yen)
-------------------------------------------------------------------------------------------------------------
Three months ended Three months ended Year ended
June 30, 2006 June 30, 2007 March 31, 2007
-------------------------------------------------------------------------------------------------------------
Cash flows from operating activities 26,345 21,425 167,297
Cash flows from investing activities -5,086 -107,242 -115,432
Cash flows from financing activities -17,482 -2,882 9,282
Cash and cash equivalents at end of period 189,173 171,602 255,737
-------------------------------------------------------------------------------------------------------------
2. FORECAST OF OPERATING RESULTS FROM APRIL 1, 2007 TO MARCH 31, 2008 (Millions of yen)
-------------------------------------------------------------------------------------------------------------
Half year ending Year ending
September 30, 2007 March 31, 2008
-------------------------------------------------------------------------------------------------------------
Net sales 1,067,700 2,250,000
Operating income 83,000 195,000
Income from continuing operations before income taxes 89,000 192,000
Net income 56,000 117,000
Net income per share (yen) 76.72 160.28
-------------------------------------------------------------------------------------------------------------
* In accordance with Japanese regulations, Ricoh has issued forecast for its
financial results for the fiscal year ending March 31, 2008. These forecast
are forward-looking statements based on a number of assumptions and beliefs
in light of the information.
3. OTHERS
(1) Significant changes to consolidated subsidiaries:
Consolidated subsidiaries: 1 removal (Lanier Worldwide, Inc.)
(2) Changes in accounting method:
Not applicable
2
CONSOLIDATED PERFORMANCE
1. OPERATING RESULTS
*Overview
Consolidated net sales for the first quarter of fiscal year 2008 (the three
months period from April 1, 2007 to June 30, 2007) increased by 9.4% as
compared to the previous corresponding period, to Yen 530.1 billion. During
this quarter, the average yen exchange rates were Yen 120.77 against the U.S.
dollar (down Yen 6.24) and Yen 162.72 against the Euro (down Yen 18.94). Net
sales would have increased by 4.1% excluding impact of such foreign currency
exchange fluctuation.
As for Japan, sales of product categories such as PPCs (plain paper copiers),
MFPs (multifunctional printers) and laser printers, especially color models,
and sales in the solutions business, such as support and services relating to
Ricoh's imaging solutions products, increased. Sales in the Industrial Products
and Other segments also increased. Consequently, overall domestic sales
increased by 1.8% as compared to the previous corresponding period.
As for overseas, the increase in sales of color MFPs and color laser printers
contributed to the favorable performance in each geographic area. Although
sales in the Americas increased slightly by 2.5% (-2.7%, excluding foreign
currency exchange fluctuation) due to a special pronouncement in the Industrial
Products segment, sales in Europe, including Infotec Europe increased
significantly by 29.4% (14.4%, excluding foreign currency exchange fluctuation)
and sales in Other, comprised of China, Asia and Oceania, continued to increase
by 17.9% (6.8%, excluding foreign currency exchange fluctuation). As a result,
sales in the overseas market increased by 16.9% as compared to the previous
corresponding period. Excluding effects of foreign currency fluctuations, net
sales in overseas would have increased by 6.4% as compared to the previous
corresponding period.
Gross profit increased by 12.9% as compared to the previous corresponding
period, to Yen 228.7 billion. This increase primarily reflects the increase in
sales derived from the value-added high-margin products in the Office Solutions
segment and depreciation of yen in exchange rate. Gross profit as a percentage
of net sales increased by 1.4 percentage points as compared to the previous
corresponding period, to 43.2%.
Selling, general and administrative expenses increased by 12.5% as compared to
the previous corresponding period, to Yen 182.1 billion due to the increase in
personnel expenses resulting from merit increase, as well as increased R&D
expenses and depreciation of yen.
As a result, operating income increased by 14.7% as compared to the previous
corresponding period, to Yen 46.6 billion.
Other (income) expenses improved significantly as compared to the previous
corresponding period due to a gain on foreign exchange as opposed to a loss on
foreign exchange in the previous corresponding period. As a result, income from
continuing operations before income taxes increased by 37.6% as compared to the
previous corresponding period, to Yen 53.2 billion.
As a result, income from continuing operations increased by 43.3% as compared
to the previous corresponding period.
Net income increased by 16.2% as compared to the previous corresponding period,
to Yen 33.8 billion, despite the fact that income from discontinued operations
Yen 5.5 billion recorded in the previous corresponding period.
3
*Conditions by Product Line
Office Solutions (Sales up 10.0% to Yen 452.8 billion)
------------------------------------------------------
Imaging Solutions (Sales up 10.6% to Yen 412.1 billion)
-------------------------------------------------------
As for PPCs and MFPs, decreased sales of monochrome products were offset
completely the increased sales of color products mainly in the overseas
market. As a result, overall sales of PPCs and MFPs increased as compared to
the previous corresponding period.
As for printers, sales of color laser printers and color GELJET printers
increased and sales of monochrome products increased in the overseas market
as well.
Network System Solutions (Sales up 4.1% to Yen 40.6 billion)
------------------------------------------------------------
Sales of PC servers mainly in Japan market and sales of support and services
in Japan and the overseas market increased.
As a result, sales in the Office Solutions segment increased by 10.0% as
compared to the previous corresponding period, to Yen 452.8 billion. Operating
income increased by 18.3% as compared to the previous corresponding period, to
Yen 60.7 billion due to the increase in sales of color products, as well as
continuous cost reduction and depreciation of yen.
Industrial Products (Sales up 2.4% to Yen 35.5 billion)
-------------------------------------------------------
Sales in the Industrial Products segment increased by 2.4% as compared to the
previous corresponding period, to Yen 35.5 billion. Although sales of
electronic components in the Americas decreased significantly, sales of thermal
media and semiconductor devices increased. Sales of measuring equipment
increased due primarily to the recovery in demand for such products.
As a result, operating income in the Industrial Products segment was Yen 1.1
billion (Yen 1.2 billion for the previous corresponding period).
Other (Sales up 9.7% to Yen 41.7 billion)
-----------------------------------------
Net sales in the Other segment increased by 9.7% as compared to the previous
corresponding period, to Yen 41.7 billion. Sales of optical discs increased in
the overseas market and sales of digital cameras increased mainly in Japan
market. As a result operating income in the Other segment was Yen 0.8 billion
(Yen 0.6 billion for the previous corresponding period).
2. FINANCIAL POSITION
*Assets, Liabilities and Shareholders' Investment
For Assets, cash and cash equivalents decreased and other investments including
goodwill increased due primarily to the formation of a joint venture company,
InfoPrint Solutions Company, LLC, with IBM Corporation. Assets denominated in
foreign currency increased due primarily to the foreign currency exchange
fluctuations. As a result, total assets increased by Yen 70.1 billion, to Yen
2,313.5 billion.
For Liabilities, short-term borrowings temporarily increased and other fixed
liabilities increased due primarily to the joint venture as well as foreign
currency exchange fluctuations. As a result, total liabilities increased by Yen
22.4 billion, to Yen 1,138.0 billion.
Stockholders' investment increased by Yen 40.1 billion, to Yen 1,111.0 billion
due primarily to retained earnings decreased by dividends payment and increased
by earning profit, and an increase in cumulative translation adjustments for
foreign currency exchange fluctuations.
*Cash Flows (Three months from April 1, 2007 to June 30, 2007)
As compared to the previous corresponding period, net cash provided by
operating activities in this period decreased by Yen 4.9 billion, to Yen 21.4
billion. Net cash provided by operating activities consisted primarily of an
increase in net income and depreciation and amortization, a decrease in trade
receivables and other of which were partially offset by an increase in
inventories and a decrease in trade payables.
As compared to the previous corresponding period, net cash used in investing
activities in this period decreased by Yen 102.1 billion, to Yen 107.2 billion.
Net cash used in investing activities consisted primarily of a payment for the
formation of a joint venture company with IBM Corporation.
As a result, free cash flows generated by operating and investing activities
decreased by Yen 107.0 billion as compared to the previous corresponding
period, to cash outflows of Yen 85.8 billion.
Net cash used in financing activities amounted to Yen 2.8 billion due primarily
to a decrease in long-term indebtedness and dividends payment and other of
which were partially offset by an increase in short-term borrowings.
As a result, cash and cash equivalents at the end of this first quarter
decreased by Yen 84.1 billion as compared to the end of the preceding fiscal
year, to Yen 171.6 billion.
4
3. FORECAST FOR THE ENTIRE FISCAL YEAR
Ricoh has not changed its fiscal forecast for the year ending March 31, 2008
that previously announced in April 2007 although the exchange rate fluctuations
would effect its financial statements as with this first quarter results.
Ricoh assumes that exchange rates of Yen 115.00 against the U.S. dollar and of
Yen 155.00 against the Euro in and after the second quarter, which were the
same forecast that announced in April 2007. The actual exchange rates during
the first quarter were incorporated in annual exchange rates assumption.
Our performance forecast for fiscal year 2008 is as follows:
Exchange Rate Assumptions for the full year ending March 31, 2008
US$ 1 = Yen 116.44 (Yen 117.02 in previous fiscal year)
EURO 1 = Yen 156.93 (Yen 150.08 in previous fiscal year)
(Billions of yen)
---------------------------------------------------------------------------------------------
Year ended Year ending
March 31, 2007 March 31, 2008
(Results) (Forecast) Change
---------------------------------------------------------------------------------------------
Domestic sales 1,002.2 1,040.0 3.8%
Overseas sales 1,066.6 1,210.0 13.4%
Net sales 2,068.9 2,250.0 8.8%
Gross profit 862.4 940.0 9.0%
Operating income 174.3 195.0 11.8%
Income from continuing operations before
income taxes 174.5 192.0 10.0%
Net income 111.7 117.0 4.7%
---------------------------------------------------------------------------------------------
* Ricoh bases the forecast estimates for the year ending March 31, 2008 above
upon information currently available to management, which involves risks and
uncertainties that could cause actual results to differ materially from those
projected.
4. OTHER
(1) Significant changes to consolidated subsidiaries:
As of April 1, 2007, Ricoh Corporation ("RC"), a wholly-owned subsidiary of the
Company, completed the merger with Lanier Worldwide, Inc. ("Lanier"), a
wholly-owned subsidiary of RC. In associated with the merger, RC changed its
name to Ricoh Americas Corporation while Lanier was liquidated.
(2) Changes in accounting method:
Not applicable
5
5. CONSOLIDATED FINANCIAL STATEMENTS
(1) Consolidated Balance Sheets
Assets (Millions of yen)
---------------------------------------------------------------------------------------------------
March 31, 2007 June 30, 2007 Change
---------------------------------------------------------------------------------------------------
Current Assets
Cash and time deposits 257,154 173,211 -83,943
Trade receivables 693,237 704,335 11,098
Marketable securities 177 212 35
Inventories 184,354 203,565 19,211
Other current assets 65,170 68,222 3,052
Total Current Assets 1,200,092 1,149,545 -50,547
Fixed Assets
Tangible fixed assets 264,668 264,730 62
Finance receivables 435,874 441,411 5,537
Other investments 342,772 457,902 115,130
Total Fixed Assets 1,043,314 1,164,043 120,729
---------------------------------------------------------------------------------------------------
Total Assets 2,243,406 2,313,588 70,182
---------------------------------------------------------------------------------------------------
Note:
Contents of cash and time deposits;
Cash and cash equivalents 255,737 171,602
Time deposits 1,417 1,609
Liabilities and Shareholders' Investment (Millions of yen)
---------------------------------------------------------------------------------------------------
March 31, 2007 June 30, 2007 Change
---------------------------------------------------------------------------------------------------
Current Liabilities
Trade payables 367,211 357,723 -9,488
Short-term borrowings 178,847 197,283 18,436
Other current liabilities 189,554 193,944 4,390
Total Current Liabilities 735,612 748,950 13,338
Fixed Liabilities
Long-term indebtedness 236,801 231,717 -5,084
Accrued pension and severance costs 99,028 100,503 1,475
Other fixed liabilities 44,183 56,900 12,717
Total Fixed Liabilities 380,012 389,120 9,108
---------------------------------------------------------------------------------------------------
Total Liabilities 1,115,624 1,138,070 22,446
---------------------------------------------------------------------------------------------------
Minority Interest 56,869 64,493 7,624
---------------------------------------------------------------------------------------------------
Shareholders' Investment
Common stock 135,364 135,364 --
Additional paid-in capital 186,454 186,455 1
Retained earnings 752,398 775,303 22,905
Accumulated other comprehensive income (loss) 26,998 44,389 17,391
Treasury stock -30,301 -30,486 -185
Total Shareholders' Investment 1,070,913 1,111,025 40,112
---------------------------------------------------------------------------------------------------
Total Liabilities and Shareholders' Investment 2,243,406 2,313,588 70,182
---------------------------------------------------------------------------------------------------
Note:
Other comprehensive income;
Net unrealized holding gains on
available-for-sale securities 9,001 12,843 3,842
Pension liability adjustments -9,406 -12,789 -3,383
Net unrealized gains (losses) on derivative
instruments -28 -39 -11
Cumulative translation adjustments 27,431 44,374 16,943
Reference: Exchange rate
US$ 1 Yen 118.05 Yen 123.26
EURO 1 Yen 157.33 Yen 165.64
6
(2) CONSOLIDATED STATEMENTS OF INCOME
(Millions of yen)
------------------------------------------------------------------------------------------------
Three months ended Three months ended
June 30, 2006 June 30, 2007 Change %
------------------------------------------------------------------------------------------------
Net sales 484,576 530,113 45,537 9.4
Cost of sales 282,011 301,343 19,332 6.9
Percentage of net sales (%) 58.2 56.8
Gross Profit 202,565 228,770 26,205 12.9
Percentage of net sales (%) 41.8 43.2
Selling, general and administrative
expenses 161,918 182,154 20,236 12.5
Percentage of net sales (%) 33.4 34.4
Operating income 40,647 46,616 5,969 14.7
Percentage of net sales (%) 8.4 8.8
Other (income) expenses
Interest and dividend income 1,097 1,305 208 19.0
Percentage of net sales (%) 0.2 0.2
Interest expense 1,584 1,149 -435 -27.5
Percentage of net sales (%) 0.3 0.2
Other, net 1,456 -6,492 -7,948 --
Percentage of net sales (%) 0.3 -1.2
Income from continuing operations
before income taxes, equity income
and minority interests 38,704 53,264 14,560 37.6
Percentage of net sales (%) 8.0 10.0
Provision for income taxes 14,226 18,192 3,966 27.9
Percentage of net sales (%) 2.9 3.4
Minority interests in earnings of
subsidiaries 1,339 1,622 283 21.1
Percentage of net sales (%) 0.3 0.3
Equity in earnings of affiliates 486 405 -81 -16.7
Percentage of net sales (%) 0.1 0.1
Income from continuing operations 23,625 33,855 10,230 43.3
Percentage of net sales (%) 4.9 6.4
Income from discontinued operations,
net of tax 5,500 -- -5,500 --
Percentage of net sales (%) 1.1 --
Net Income 29,125 33,855 4,730 16.2
Percentage of net sales (%) 6.0 6.4
------------------------------------------------------------------------------------------------
Reference : Exchange rate
US$ 1 Yen 114.53 Yen 120.77
EURO 1 Yen 143.78 Yen 162.72
(3)-1 CONSOLIDATED SALES BY PRODUCT CATEGORY
(Millions of yen)
------------------------------------------------------------------------------------------------
Three months ended Three months ended
June 30, 2006 June 30, 2007 Change %
------------------------------------------------------------------------------------------------
[Office Solutions]
Imaging Solutions 372,755 412,183 39,428 10.6
Percentage of net sales (%) 76.9 77.8
Network System Solutions 39,047 40,655 1,608 4.1
Percentage of net sales (%) 8.1 7.6
Office Solutions Total 411,802 452,838 41,036 10.0
Percentage of net sales (%) 85.0 85.4
------------------------------------------------------------------------------------------------
[Industrial Products]
Industrial Products 34,709 35,536 827 2.4
Percentage of net sales (%) 7.2 6.7
------------------------------------------------------------------------------------------------
[Other]
Other 38,065 41,739 3,674 9.7
Percentage of net sales (%) 7.8 7.9
------------------------------------------------------------------------------------------------
Grand Total 484,576 530,113 45,537 9.4
Percentage of net sales (%) 100.0 100.0
------------------------------------------------------------------------------------------------
(3)-2 CONSOLIDATED SALES BY GEOGRAPHIC AREA
(Millions of yen)
------------------------------------------------------------------------------------------------
Three months ended Three months ended
June 30, 2006 June 30, 2007 Change %
------------------------------------------------------------------------------------------------
[Domestic] 240,431 244,734 4,303 1.8
Percentage of net sales (%) 49.6 46.2
[Overseas] 244,145 285,379 41,234 16.9
Percentage of net sales (%) 50.4 53.8
The Americas 100,635 103,174 2,539 2.5
Percentage of net sales (%) 20.8 19.5
Europe 113,510 146,849 33,339 29.4
Percentage of net sales (%) 23.4 27.7
Other 30,000 35,356 5,356 17.9
Percentage of net sales (%) 6.2 6.6
Grand Total 484,576 530,113 45,537 9.4
Percentage of net sales (%) 100.0 100.0
------------------------------------------------------------------------------------------------
7
(4) CONSOLIDATED STATEMENTS OF SHAREHOLDERS' INVESTMENT
Three month ended June 30, 2006 (Millions of yen)
------------------------------------------------------------------------------------------------------------
Accumulated
Additional other Total
Common paid-in Retained comprehensive Treasury Shareholders'
stock capital earnings income stock Investment
------------------------------------------------------------------------------------------------------------
Balance at March 31, 2006 135,364 186,450 665,394 4,099 -31,062 960,245
Cumulative effect of adjustment
from applying SAB 108 -- -- -6,464 -- -- -6,464
------------------------------------------------------------------------------------------------------------
Balance at April 1, 2006 as
adjusted 135,364 186,450 658,930 4,099 -31,062 953,781
------------------------------------------------------------------------------------------------------------
Gain on disposal of treasury stock 0 0
Dividends declared and approved -8,764 -8,764
Comprehensive income
Net income 29,125 29,125
Net unrealized holding losses
on available-for-sale securities -804 -804
Pension liability adjustments 557 557
Net unrealized losses on
derivative instruments -36 -36
Cumulative translation
adjustments 20 20
-------
Total comprehensive income 28,862
-------
Net changes in treasury stocks -121 -121
------------------------------------------------------------------------------------------------------------
Balance at June 30, 2006 135,364 186,450 679,291 3,836 -31,183 973,758
============================================================================================================
Three month ended June 30, 2007 (Millions of yen)
------------------------------------------------------------------------------------------------------------
Accumulated
Additional other Total
Common paid-in Retained comprehensive Treasury Shareholders'
stock capital earnings income stock Investment
------------------------------------------------------------------------------------------------------------
Balance at March 31, 2007 135,364 186,454 752,398 26,998 -30,301 1,070,913
------------------------------------------------------------------------------------------------------------
Gain on disposal of treasury stock 1 1
Dividends declared and approved -10,950 -10,950
Comprehensive income
Net income 33,855 33,855
Net unrealized holding gains
on available-for-sale securities 3,842 3,842
Pension liability adjustments -3,383 -3,383
Net unrealized losses on
derivative instruments -11 -11
Cumulative translation
adjustments 16,943 16,943
---------
Total comprehensive income 51,246
---------
Net changes in treasury stocks -185 -185
------------------------------------------------------------------------------------------------------------
Balance at June 30, 2007 135,364 186,455 775,303 44,389 -30,486 1,111,025
============================================================================================================
8
(5) CONSOLIDATED STATEMENTS OF CASH FLOWS
(Millions of yen)
-------------------------------------------------------------------------------
Three months ended Three months ended
June 30, 2006 June 30, 2007
-------------------------------------------------------------------------------
I. Cash Flows from Operating Activities:
Net income 29,125 33,855
Income from discontinued
operations, net of tax -5,500 --
-------------------------------------
Income from continuing operations 23,625 33,855
Adjustments to reconcile net
income to net cash provided by
operating activities--
Depreciation and amortization 20,776 21,652
Equity in earnings of
affiliates, net of
dividends received 7 170
Deferred income taxes -1,232 1,236
Loss on disposals and sales
of tangible fixed assets 116 126
Pension and severance costs,
less payments 134 -3,074
Changes in assets and liabilities--
Decrease in trade receivables 3,233 4,886
Increase in inventories -14,205 -14,148
Increase in finance receivables -7,217 -4,068
Decrease in trade payables -9,533 -13,989
Increase in accrued income
taxes and accrued expenses
and other 7,970 -32
Other, net 2,671 -5,189
-------------------------------------------------------------------------------
Net cash provided by operating
activities 26,345 21,425
-------------------------------------------------------------------------------
II. Cash Flows from Investing Activities:
Proceeds from sales of property,
plant and equipment 42 56
Expenditures for property, plant
and equipment -15,954 -17,104
Payments for purchases of
available-for-sale securities -24,739 -24,261
Proceeds from sales of
available-for-sale securities 24,019 24,421
Increase in time deposits -38 -131
Proceeds from sales of
discontinued operations 12,000 --
Other, net -416 -90,223
-------------------------------------------------------------------------------
Net cash used in investing
activities -5,086 -107,242
-------------------------------------------------------------------------------
III. Cash Flows from Financing Activities:
Proceeds from long-term
indebtedness 36,069 9,683
Repayment of long-term
indebtedness -13,845 -22,562
Increase (Decrease) in short-term
borrowings, net -12,526 31,441
Repayment of long-term debt
securities -18,000 -10,000
Dividends paid -8,764 -10,950
Payment for purchase of treasury
stock -125 -186
Other, net -291 -308
-------------------------------------------------------------------------------
Net cash used in financing activities -17,482 -2,882
-------------------------------------------------------------------------------
IV. Net Increase in Cash and Cash
Equivalents from discontinued
operations 825 --
-------------------------------------------------------------------------------
V. Effect of Exchange Rate Changes
on Cash and Cash Equivalents -2,484 4,564
-------------------------------------------------------------------------------
VI. Net Increase (Decrease) in Cash
and Cash Equivalents 2,118 -84,135
-------------------------------------------------------------------------------
VII. Cash and Cash Equivalents at
Beginning of Year 187,055 255,737
-------------------------------------------------------------------------------
VIII. Cash and Cash Equivalents at
End of Period 189,173 171,602
-------------------------------------------------------------------------------
9
(6) SEGMENT INFORMATION
(a) Operating Segments Information
(Millions of yen)
-----------------------------------------------------------------------------------------------
Three months ended Three months ended
June 30, 2006 June 30, 2007 Change %
-----------------------------------------------------------------------------------------------
OFFICE SOLUTIONS:
Net sales:
Unaffiliated customers 411,802 452,838 41,036 10.0
Intersegment -- -- -- --
Total 411,802 452,838 41,036 10.0
-----------------------------------------------------------------------------------------------
Operating expenses 360,458 392,081 31,623 8.8
-----------------------------------------------------------------------------------------------
Operating income 51,344 60,757 9,413 18.3
Operating income on sales
in Office Solutions (%) 12.5 13.4
-----------------------------------------------------------------------------------------------
INDUSTRIAL PRODUCTS:
Net sales:
Unaffiliated customers 34,709 35,536 827 2.4
Intersegment 1,205 1,119 -86 -7.1
Total 35,914 36,655 741 2.1
-----------------------------------------------------------------------------------------------
Operating expenses 34,680 35,554 874 2.5
-----------------------------------------------------------------------------------------------
Operating income 1,234 1,101 -133 -10.8
Operating income on sales
in Industrial Products (%) 3.4 3.0
-----------------------------------------------------------------------------------------------
OTHER:
Net sales:
Unaffiliated customers 38,065 41,739 3,674 9.7
Intersegment -- -- -- --
Total 38,065 41,739 3,674 9.7
-----------------------------------------------------------------------------------------------
Operating expenses 37,382 40,897 3,515 9.4
-----------------------------------------------------------------------------------------------
Operating income 683 842 159 23.3
Operating income on sales
in Other (%) 1.8 2.0
-----------------------------------------------------------------------------------------------
CORPORATE AND ELIMINATIONS:
Net sales:
Intersegment -1,205 -1,119 86 --
Total -1,205 -1,119 86 --
-----------------------------------------------------------------------------------------------
Operating expenses:
Intersegment -1,250 -1,117 133 --
Corporate 12,659 16,082 3,423 --
Total 11,409 14,965 3,556 --
-----------------------------------------------------------------------------------------------
Operating income -12,614 -16,084 -3,470 --
-----------------------------------------------------------------------------------------------
CONSOLIDATED:
Net sales:
Unaffiliated customers 484,576 530,113 45,537 9.4
Intersegment -- -- -- --
Total 484,576 530,113 45,537 9.4
-----------------------------------------------------------------------------------------------
Operating expenses 443,929 483,497 39,568 8.9
-----------------------------------------------------------------------------------------------
Operating income 40,647 46,616 5,969 14.7
Operating income on
consolidated net sales (%) 8.4 8.8
-----------------------------------------------------------------------------------------------
10
(b) Geographic Segments Information
(Millions of yen)
-----------------------------------------------------------------------------------------------
Three months ended Three months ended
June 30, 2006 June 30, 2007 Change %
-----------------------------------------------------------------------------------------------
JAPAN:
Net sales:
External customers 246,140 252,126 5,986 2.4
Intersegment 123,068 141,627 18,559 15.1
Total 369,208 393,753 24,545 6.6
-----------------------------------------------------------------------------------------------
Operating expenses 337,072 358,680 21,608 6.4
-----------------------------------------------------------------------------------------------
Operating income 32,136 35,073 2,937 9.1
Operating income on sales
in Japan (%) 8.7 8.9
-----------------------------------------------------------------------------------------------
THE AMERICAS:
Net sales:
External customers 100,625 102,511 1,886 1.9
Intersegment 989 829 -160 -16.2
Total 101,614 103,340 1,726 1.7
-----------------------------------------------------------------------------------------------
Operating expenses 99,593 101,504 1,911 1.9
-----------------------------------------------------------------------------------------------
Operating income 2,021 1,836 -185 -9.2
Operating income on sales
in the Americas (%) 2.0 1.8
-----------------------------------------------------------------------------------------------
EUROPE:
Net sales:
External customers 113,509 146,618 33,109 29.2
Intersegment 898 1,210 312 34.7
Total 114,407 147,828 33,421 29.2
-----------------------------------------------------------------------------------------------
Operating expenses 109,783 141,063 31,280 28.5
-----------------------------------------------------------------------------------------------
Operating income 4,624 6,765 2,141 46.3
Operating income on sales
in Europe (%) 4.0 4.6
-----------------------------------------------------------------------------------------------
OTHER:
Net sales:
External customers 24,302 28,858 4,556 18.7
Intersegment 32,347 47,426 15,079 46.6
Total 56,649 76,284 19,635 34.7
-----------------------------------------------------------------------------------------------
Operating expenses 52,330 70,614 18,284 34.9
-----------------------------------------------------------------------------------------------
Operating income 4,319 5,670 1,351 31.3
Operating income on sales
in Other (%) 7.6 7.4
-----------------------------------------------------------------------------------------------
CORPORATE AND ELIMINATIONS:
Net sales:
Intersegment -157,302 -191,092 -33,790 --
Total -157,302 -191,092 -33,790 --
-----------------------------------------------------------------------------------------------
Operating expenses -154,849 -188,364 -33,515 --
-----------------------------------------------------------------------------------------------
Operating income -2,453 -2,728 -275 --
-----------------------------------------------------------------------------------------------
CONSOLIDATED:
Net sales:
External customers 484,576 530,113 45,537 9.4
Intersegment -- -- -- --
Total 484,576 530,113 45,537 9.4
-----------------------------------------------------------------------------------------------
Operating expenses 443,929 483,497 39,568 8.9
-----------------------------------------------------------------------------------------------
Operating income 40,647 46,616 5,969 14.7
Operating income on
consolidated net sales (%) 8.4 8.8
----------------------------------------------------------------------------------------------
11
-APPENDIX- (THREE MONTHS ENDED JUNE 30, 2007)
1. CONSOLIDATED SALES BY PRODUCT CATEGORY
(Millions of yen)
----------------------------------------------------------------------------------------------------------------------
Three months ended Three months ended Change excluding
June 30, 2006 June 30, 2007 Change % exchange impact %
----------------------------------------------------------------------------------------------------------------------
[Office Solutions]
Imaging Solutions 372,755 412,183 39,428 10.6 15,534 4.2
Percentage of net sales (%) 76.9 77.8
Domestic 151,521 151,673 152 0.1 152 0.1
Overseas 221,234 260,510 39,276 17.8 15,382 7.0
Network System Solutions 39,047 40,655 1,608 4.1 1,287 3.3
Percentage of net sales (%) 8.1 7.6
Domestic 37,242 38,038 796 2.1 796 2.1
Overseas 1,805 2,617 812 45.0 491 27.2
Office Solutions Total 411,802 452,838 41,036 10.0 16,821 4.1
Percentage of net sales (%) 85.0 85.4
Domestic 188,763 189,711 948 0.5 948 0.5
Overseas 223,039 263,127 40,088 18.0 15,873 7.1
The Americas 93,041 98,657 5,616 6.0 519 0.6
Europe 107,310 138,259 30,949 28.8 14,867 13.9
Other 22,688 26,211 3,523 15.5 487 2.1
----------------------------------------------------------------------------------------------------------------------
[Industrial Products]
Industrial Products 34,709 35,536 827 2.4 15 0.0
Percentage of net sales (%) 7.2 6.7
Domestic 18,830 20,660 1,830 9.7 1,830 9.7
Overseas 15,879 14,876 -1,003 -6.3 -1,815 -11.4
The Americas 7,339 3,494 -3,845 -52.4 -4,025 -54.8
Europe 4,700 5,968 1,268 27.0 708 15.1
Other 3,840 5,414 1,574 41.0 1,502 39.1
----------------------------------------------------------------------------------------------------------------------
[Other]
Other 38,065 41,739 3,674 9.7 3,150 8.3
Percentage of net sales (%) 7.8 7.9
Domestic 32,838 34,363 1,525 4.6 1,525 4.6
Overseas 5,227 7,376 2,149 41.1 1,625 31.1
The Americas 255 1,023 768 301.2 748 293.3
Europe 1,500 2,622 1,122 74.8 827 55.1
Other 3,472 3,731 259 7.5 50 1.4
----------------------------------------------------------------------------------------------------------------------
Grand Total 484,576 530,113 45,537 9.4 19,986 4.1
Percentage of net sales (%) 100.0 100.0
Domestic 240,431 244,734 4,303 1.8 4,303 1.8
Percentage of net sales (%) 49.6 46.2
Overseas 244,145 285,379 41,234 16.9 15,683 6.4
Percentage of net sales (%) 50.4 53.8
The Americas 100,635 103,174 2,539 2.5 -2,758 -2.7
Percentage of net sales (%) 20.8 19.5
Europe 113,510 146,849 33,339 29.4 16,402 14.4
Percentage of net sales (%) 23.4 27.7
Other 30,000 35,356 5,356 17.9 2,039 6.8
Percentage of net sales (%) 6.2 6.6
----------------------------------------------------------------------------------------------------------------------
Reference: Exchange rate
US$ 1 Yen 114.53 Yen 120.77 Yen 6.24
EURO 1 Yen 143.78 Yen 162.72 Yen 18.94
* Each category includes the following product line:
Imaging Solutions Digital PPCs, color PPCs, digital duplicators,
facsimile machines, analog PPCs, diazo copiers,
scanners, MFPs(multifunctional printers),
laser printers and software
Network System Solutions Personal computers, servers, network systems
and network related software
Industrial Products Thermal media, optical equipment, semiconductor
devices, electronic components and measuring
equipment
Other Optical discs and digital cameras
A1
2. FORECAST OF CONSOLIDATED PERFORMANCE
(Billions of yen)
----------------------------------------------------------------------------------------------------------------------------
Three months ended Three months ending Half year ending Year ending
June 30, 2007 Change Sept. 30, 2007 Change Sept. 30, 2007 Change March 31, 2008 Change
Results % Forecast % Forecast % Forecast %
----------------------------------------------------------------------------------------------------------------------------
Net sales 530.1 9.4 537.5 7.0 1,067.7 8.2 2,250.0 8.8
Gross profit 228.7 12.9 222.4 8.3 451.2 10.6 940.0 9.0
Operating income 46.6 14.7 36.3 11.9 83.0 13.4 195.0 11.8
Income from continuing
operations before
income taxes 53.2 37.6 35.7 0.5 89.0 19.8 192.0 10.0
Net income 33.8 16.2 22.1 -3.4 56.0 7.6 117.0 4.7
----------------------------------------------------------------------------------------------------------------------------
Net income per share (yen) 46.38 -- 30.34 -- 76.72 -- 160.28 --
Net income per
share-diluted (yen) 45.15 -- 29.53 -- 74.68 -- 156.03 --
----------------------------------------------------------------------------------------------------------------------------
Capital expenditures 17.1 -- 22.8 -- 40.0 -- 90.0 --
Depreciation for
tangible fixed assets 16.8 -- 19.1 -- 36.0 -- 76.0 --
R&D expenditures 27.2 -- 33.7 -- 61.0 -- 128.0 --
----------------------------------------------------------------------------------------------------------------------------
Exchange rate (Yen/US$) 120.77 -- 115.00 -- 117.89 -- 116.44 --
Exchange rate (Yen/EURO) 162.72 -- 155.00 -- 158.86 -- 156.93 --
----------------------------------------------------------------------------------------------------------------------------
3. FORECAST OF CONSOLIDATED SALES BY PRODUCT CATEGORY
(Billions of yen)
---------------------------------------------------------------------------------------------------------
Half year ending September 30, 2007 Year ending March 31, 2008
----------------------------------------------------------------------
Change Change Change Change
Forecast % Forecast(*) % Forecast % Forecast(*) %
---------------------------------------------------------------------------------------------------------
[Office Solutions]
Imaging Solutions 813.0 9.3 784.9 5.6 1,735.2 9.8 1,714.0 8.5
Domestic 299.2 1.7 299.2 1.7 625.6 3.6 625.6 3.6
Overseas 513.7 14.4 485.6 8.1 1,109.5 13.7 1,088.3 11.5
Network System Solutions 99.2 5.1 98.9 4.7 206.1 6.1 205.8 5.9
Domestic 93.4 4.2 93.4 4.2 195.1 5.7 195.1 5.7
Overseas 5.8 20.8 5.4 13.1 11.0 14.3 10.6 11.0
Office Solutions Total 912.2 8.9 883.8 5.5 1,941.4 9.4 1,919.9 8.2
Domestic 392.7 2.3 392.7 2.3 820.8 4.1 820.8 4.1
Overseas 519.5 14.4 491.0 8.2 1,120.5 13.7 1,099.0 11.5
The Americas 204.6 7.2 200.8 5.2 458.6 13.1 462.7 14.1
Europe 261.9 22.3 240.3 12.2 555.7 15.8 533.1 11.1
Other 52.9 8.1 49.8 1.9 106.2 5.8 103.1 2.7
---------------------------------------------------------------------------------------------------------
[Industrial Products]
Industrial Products 71.8 5.2 70.7 3.7 141.5 6.1 140.5 5.4
Domestic 42.0 9.3 42.0 9.3 79.3 4.1 79.3 4.1
Overseas 29.7 0.1 28.7 -3.5 62.1 8.7 61.2 7.0
The Americas 7.7 -35.5 7.6 -37.0 16.5 -14.4 16.6 -14.3
Europe 11.1 19.0 10.3 10.4 21.7 12.3 20.8 7.6
Other 10.8 30.5 10.7 29.6 23.8 29.3 23.7 28.9
---------------------------------------------------------------------------------------------------------
[Other]
Other 83.5 3.7 83.0 3.0 167.0 3.7 166.5 3.4
Domestic 69.9 -0.1 69.9 -0.1 139.8 1.8 139.8 1.8
Overseas 13.6 28.8 13.1 23.4 27.2 14.6 26.7 12.6
The Americas 1.6 188.3 1.6 193.6 2.5 56.9 2.6 65.0
Europe 4.7 60.1 4.3 46.7 9.6 21.5 9.2 16.5
Other 7.3 3.1 7.1 0.2 15.0 6.0 14.8 4.6
---------------------------------------------------------------------------------------------------------
Grand Total 1,067.7 8.2 1,037.5 5.1 2,250.0 8.8 2,227.0 7.6
Domestic 504.7 2.5 504.7 2.5 1,040.0 3.8 1,040.0 3.8
Overseas 563.0 13.9 532.8 7.8 1,210.0 13.4 1,187.0 11.3
The Americas 214.0 5.2 210.0 3.2 477.7 12.0 481.9 13.0
Europe 277.8 22.7 255.0 12.6 587.1 15.8 563.2 11.1
Other 71.0 10.4 67.7 5.3 145.1 9.1 141.7 6.6
---------------------------------------------------------------------------------------------------------
* Excluding foreign exchange impact
A2