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 August 2009
Commission File Number 2 - 68279
RICOH COMPANY, LTD.
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(Translation of Registrant's name into English)
13-1, Ginza 8-Chome, Chuo-ku, Tokyo 104-8222, Japan
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(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.
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(Registrant)
By: /S/ Zenji Miura
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Zenji Miura
Director, Chief Financial Officer
Corporate Executive Vice President
August 7, 2009
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RICOH COMPANY, LTD.
Consolidated Financial Statements
for the First Quarter Ended June 30, 2009
This is an English translation of the Quarterly Securities Report (Shihanki
Hokokusho) for the first quarter ended June 30, 2009 pursuant to the Japanese
Financial Instrument and Exchange Law.
Ricoh Company, Ltd. and Consolidated Subsidiaries
CONSOLIDATED BALANCE SHEETS
June 30, 2009 and March 31, 2009
Millions of Yen
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June 30, March 31,
ASSETS 2009 2009
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Current assets:
Cash and cash equivalents 196,098 258,484
Time deposits 1,805 2,043
Trade receivables:
Notes 46,474 45,781
Accounts 428,738 460,519
Less- Allowance for doubtful receivables (21,275) (21,533)
Current maturities of long-term finance receivables, net 197,727 195,617
Inventories:
Finished goods 108,540 123,798
Work in process and raw materials 84,793 67,772
Deferred income taxes and other 79,735 79,385
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Total current assets 1,122,635 1,211,866
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Property, plant and equipment, at cost:
Land 45,509 45,693
Buildings 240,014 235,905
Machinery and equipment 638,780 613,879
Construction in progress 21,221 23,459
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Total 945,524 918,936
Less- accumulated depreciation (677,435) (649,600)
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Net property, plant and equipment 268,089 269,336
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Investments and other assets:
Long-term finance receivables, net 458,704 465,262
Investment securities 54,624 47,815
Investments in and advances to affiliates 1,209 1,248
Goodwill 253,697 250,330
Other intangible assets 161,311 165,126
Lease deposits and other 104,122 102,512
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Total investments and other assets 1,033,667 1,032,293
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Total 2,424,391 2,513,495
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1
Millions of Yen
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June 30, March 31,
LIABILITIES AND SHAREHOLDERS' EQUITY 2009 2009
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Current liabilities:
Short-term borrowings 82,027 184,210
Current maturities of long-term indebtedness 88,597 85,582
Trade payables:
Notes 13,402 12,914
Accounts 233,010 272,499
Accrued income taxes 5,298 10,317
Accrued expenses and other 223,173 207,969
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Total current liabilities 645,507 773,491
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Long-term liabilities:
Long-term indebtedness 551,049 509,403
Accrued pension and severance costs 153,859 156,625
Deferred income taxes 47,487 49,626
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Total long-term liabilities 752,395 715,654
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Ricoh Shareholders' Equity:
Common stock 135,364 135,364
Additional paid-in capital 186,083 186,083
Retained earnings 805,741 815,725
Accumulated other comprehensive loss (113,421) (125,121)
Treasury stock at cost (36,701) (36,678)
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Total Ricoh shareholders' equity 977,066 975,373
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Noncontrolling interest 49,423 48,977
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Total equity 1,026,489 1,024,350
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Total 2,424,391 2,513,495
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The accompanying notes are an integral part of these financial statements.
2
Ricoh Company, Ltd. and Consolidated Subsidiaries
CONSOLIDATED STATEMENT OF INCOME
For the First Quarter Ended June 30, 2008 and 2009
Millions of Yen
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First quarter ended First quarter ended
June 30, 2008 June 30, 2009
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Net Sales:
Products 275,485 225,311
Post sales and rentals 221,044 241,379
Other revenue 25,045 24,699
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Total 521,574 491,389
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Cost of sales:
Products 175,250 159,051
Post sales and rentals 98,441 113,074
Other revenue 19,486 18,959
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Total 293,177 291,084
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Gross profit 228,397 200,305
Selling, general and administrative expenses 188,647 194,229
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Operating income 39,750 6,076
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Other (income) expenses:
Interest and dividend income (1,288) (583)
Interest expense 1,069 2,103
Foreign currency exchange (gain) loss, net (2,935) 944
Other, net (831) 197
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Total (3,985) 2,661
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Income before income taxes and equity in earnings of affiliates 43,735 3,415
Provision for income taxes:
Current 19,479 6,012
Deferred (2,654) (4,133)
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Total 16,825 1,879
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Equity in earnings of affiliates 7 4
Consolidated net income 26,917 1,540
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Net income attributable to noncontrolling interest 1,174 637
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Net income attributable to Ricoh Company, Ltd. 25,743 903
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Yen Yen
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Per share of common stock:
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Basic 35.71 1.24
Diluted 34.75 1.20
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Cash dividends paid per share 17.00 15.00
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Per American Depositary Share, each representing 5 shares of
common stock:
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Basic 178.55 6.20
Diluted 173.75 6.00
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Cash dividends paid per share 85.00 75.00
=========================================================================================================================
The accompanying notes are an integral part of these financial statements.
3
Ricoh Company, Ltd. and Consolidated Subsidiaries
CONSOLIDATED STATEMENT OF CASH FLOWS
For the First Quarter Ended June 30, 2008 and 2009
Millions of Yen
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First Quarter ended First Quarter ended
June 30, 2008 June 30, 2009
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CASH FLOWS FROM OPERATING ACTIVITIES:
Consolidated net income 26,917 1,540
Adjustments to reconcile net income to net cash
provided by operating activities-
Depreciation and amortization 24,312 23,836
Equity in earnings of affiliates, net of dividends received (7) (4)
Deferred income taxes (2,654) (4,133)
Losses on disposals and sales of property, plant and equipment 348 86
Pension and severance costs, less payment 695 (550)
Changes in assets and liabilities, net of effects from acquisition-
Decrease in trade receivables 238 35,697
(Increase) Decrease in inventories (18,258) 241
(Increase) Decrease in finance receivables (11,369) 8,134
Decrease in trade payables (16,658) (39,847)
Increase in accrued income taxes and accrued expenses and other 9,427 4,306
Other, net (2,726) 3,238
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Net cash provided by operating activities 10,265 32,544
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CASH FLOWS FROM INVESTING ACTIVITIES:
Proceeds from sales of property, plant and equipment 0 178
Expenditures for property, plant and equipment (20,414) (17,384)
Payments for purchases of available-for-sale securities (504) (602)
Proceeds from sales of available-for-sale securities 224 910
(Increase) Decrease in time deposits, net (377) 218
Purchase of business, net of cash acquired (4,717) (4,760)
Other, net (4,914) (5,124)
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Net cash used in investing activities (30,702) (26,564)
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CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from long-term indebtedness 13,777 28,903
Repayment of long-term indebtedness (17,515) (21,626)
Increase (Decrease) in short-term borrowings, net 34,484 (101,061)
Proceeds from issuance of long-term debt securities -- 35,000
Dividends paid (12,256) (10,885)
Payment for purchase of treasury stock (54) (30)
Other, net (387) (276)
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Net cash provided by (used in) financing activities 18,049 (69,975)
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EFFECT OF EXCHANGE RATE CHANGES ON CASH AND CASH EQUIVALENTS 6,040 1,609
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NET INCREASE IN CASH AND CASH EQUIVALENTS 3,652 (62,386)
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CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR 170,607 258,484
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CASH AND CASH EQUIVALENTS AT END OF PERIOD 174,259 196,098
=========================================================================================================================
The accompanying notes are an integral part of these financial statements.
4
Ricoh Company, Ltd. and Consolidated Subsidiaries
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
1. SIGNIFICANT ACCOUNTING AND REPORTING POLICIES
According to the article 93 of the "Regulations Regarding Terms, Forms and
Preparation of Interim Consolidated Financial Statements" (Cabinet office
Ordinance No.64, 2007), the accompanying consolidated financial statements of
Ricoh (Ricoh Company, Ltd. and its consolidated subsidiaries) have been prepared
in conformity with U.S. generally accepted accounting principles. Significant
accounting and reporting policies are summarized below:
The accompanying consolidated financial statements for the first quarter ended
June 30, 2009 are presented in Japanese yen, the functional currency of the
Company and its domestic subsidiaries.
The books of the Company and its domestic subsidiaries are maintained in
conformity with Japanese accounting principles and practices, while foreign
subsidiaries maintain their books in conformity with the standards of their
country of domicile.
The accompanying consolidated financial statements reflect necessary
adjustments, not recorded in the books, to present them in conformity with U.S.
generally accepted accounting principles.
(A) PRINCIPLES OF CONSOLIDATION
The accompanying consolidated financial statements include the accounts of the
Company and all majority-owned subsidiaries. The accounts of variable interest
entity as defined by the FASB Interpretation ("FIN") No. 46 (revised December
2003), "Consolidated of Variable Interest Entities" are included in the
consolidated financial statements, if applicable. Investments in entities in
which Ricoh has the ability to exercise significant influence over the entities'
operating and financial policies (generally 20 to 50 % ownership) are accounted
for on an equity basis. All significant intercompany balances and transactions
have been eliminated in consolidation.
The accounts of certain consolidated subsidiaries have been included on the
basis of fiscal periods ended within three months prior to June 30.
(B) REVENUE RECOGNITION
Ricoh generates revenue principally through the sale of equipment, supplies and
related services under separate contractual arrangements for each. Ricoh
recognizes revenue when (1) it has a firm contract, (2) the product has been
shipped to and accepted by the customer or the service has been provided, (3)
the sales price is fixed or determinable and (4) amounts are reasonably assured
of collection.
Products sales is recognized at the time of delivery and installation at the
customer location. Equipment revenues are based on established prices by product
type and model and are net of discounts. A sales return is accepted only when
the equipment is defective and does not meet Ricoh's product performance
specifications. Other than installation, there are no customer acceptance
clauses in the sales contract.
Post sales and rentals result primarily from maintenance contracts that are
normally entered into at the time the equipment is sold. Standard service fee
prices are established depending on equipment classification and include a cost
value for the estimated services to be performed based on historical experience
plus a profit margin thereon. As a matter of policy, Ricoh does not discount
such prices. On a monthly basis,
5
maintenance service revenues are earned and recognized by Ricoh and billed to
the customer in accordance with the contract and include a fixed monthly fee
plus a variable amount based on usage. The length of the contract ranges up to
five-years, however, most contracts are cancelable at any time by the customer
upon a short notice period. Leases not qualifying as sales-type leases or direct
financing leases are accounted for as operating leases and related revenue is
recognized over the lease term.
Ricoh enters into arrangements with multiple elements, which may include any
combination of products, equipment, installation and maintenance. Ricoh
allocates revenue to each element based on its relative fair value if such
element meets the criteria for treatment as a separate unit of accounting as
prescribed in the Emerging Issues Task Force ("EITF") Issue No.00-21, "Revenue
Arrangements with Multiple Deliverables". Pursuant to EITF 00-21, the delivered
item in a multiple element arrangement should be considered a separate unit of
accounting if all of the following criteria are met: (1) a delivered item has
value to customers on a stand-alone basis, (2) there is objective and reliable
evidence of fair value of an undelivered item, and (3) the delivery of the
undelivered item must be probable and controlled by Ricoh if the arrangement
includes the right of return. The price charged when the element is sold
separately generally determines fair value. Otherwise, revenue is deferred until
the undelivered elements are fulfilled as a single unit of accounting.
Revenue from the sale of equipment under sales-type leases is recognized as
product sales at the inception of the lease. Other revenue consists primarily of
interest income on sales-type leases and direct-financing leases, which are
recognized as other revenue over the life of each respective lease using the
interest method.
(C) FOREIGN CURRENCY TRANSLATION
For foreign operations with functional currencies other than the Japanese yen,
assets and liabilities are translated at the exchange rates in effect at each
end of the period, and income and expenses are translated at the average rates
of exchange prevailing during each period. The resulting translation adjustments
are included as a part of accumulated other comprehensive income (loss) in Ricoh
shareholders' equity.
All foreign currency transaction gains and losses are included in other income
and expense in the period incurred.
(D) CASH EQUIVALENTS
Cash and cash equivalents include highly liquid investments with maturities of
three months or less at the date of purchase such as time deposits and
short-term investment securities which are available-for sale at any time,
present insignificant risk of changes in value due to being readily convertible
into cash and have an original maturity of three months or less, such as money
management funds and free financial funds.
(E) DERIVATIVE FINANCIAL INSTRUMENTS AND HEDGING ACTIVITIES
As discussed further in Note 7, Ricoh manages its exposure to certain market
risks, primarily foreign currency and interest rate risks, through the use of
derivative instruments. As a matter of policy, Ricoh does not enter into
derivative contracts for trading or speculative purposes.
In accordance with Statement of Financial Accounting Standards ("SFAS") No.133,
as amended, Ricoh recognizes all derivative instruments as either assets or
liabilities in the consolidated balance sheets and measures those instruments at
fair value. When Ricoh enters into a derivative contract, it makes a
determination as to whether or not for accounting purposes the derivative is
part of a hedging relationship. In general, a derivative may be designated as
either (1) a hedge of the fair value of a recognized asset or
6
liability or an unrecognized firm commitment ("fair value hedge"), (2) a hedge
of the variability of the expected cash flows associated with an existing asset
or liability or a forecasted transaction ("cash flow hedge"), or (3) a foreign
currency fair value or cash flow hedge ("foreign currency hedge"). Ricoh
formally documents all relationships between hedging instruments and hedged
items, as well as its risk-management objective and strategy for undertaking
various hedge transactions. This process includes linking all derivatives that
are designated as fair value, cash flow, or foreign currency hedges to specific
assets and liabilities on the consolidated balance sheets or to specific firm
commitments or forecasted transactions.
For derivative contracts that are designated and qualify as fair value hedges
including foreign currency fair value hedges, the derivative instrument is
marked-to-market with gains and losses recognized in current period earnings to
offset the respective losses and gains recognized on the change in fair value of
the hedged item. For derivative contracts that are designated and qualify as
cash flow hedges including foreign currency cash flow hedges, the effective
portion of gains and losses on these contracts is reported as a component of
accumulated other comprehensive income (loss) and reclassified into earnings in
the same period the hedged item or transaction affects earnings. Any hedge
ineffectiveness on cash flow hedges is immediately recognized in earnings. For
all derivative instruments that are not designated as part of a hedging
relationship and for designated derivative instruments that do not qualify for
hedge accounting, the contracts are recorded at fair value with the gain or loss
recognized in current period earnings.
(F) ALLOWANCE FOR DOUBTFUL TRADE RECEIVABLES AND FINANCE RECEIVABLES
Ricoh records allowances for doubtful receivables that are based upon historical
experience and specific customer collection issues. The estimated amount of
probable credit losses in its existing receivables is determined from write-off
history adjusted to reflect current economic conditions and specific allowances
for receivables including nonperforming leases, impaired loans or other accounts
of which Ricoh has concluded it will be unable to collect all amounts due
according to original terms of the lease or loan agreement. Account balances net
of expected recovery from available collateral are charged-off against the
allowances when collection is considered remote.
(G) SECURITIES
Ricoh applies SFAS No.115, "Accounting for Certain Investments in Debt and
Equity Securities", which requires all investments in debt and marketable equity
securities to be classified as either held-to-maturity, trading, or
available-for-sale securities. As of June 30, 2009 and March 31, 2009, Ricoh's
investments in debt and marketable equity securities are classified as trading
or available-for-sale securities. Trading securities are reported at fair value
with gains and losses recognized in current earnings. Available-for-sale
securities are reported at fair value with unrealized gains and losses, net of
related taxes, reported in accumulated other comprehensive income (loss).
Available-for-sale securities, which mature or are expected to be sold in one
year, are classified as current assets.
Individual securities classified as available-for-sale securities are reduced to
fair market value by a charge to income for other than temporary declines in
value. Factors considered in assessing whether an indication of other than
temporary impairment exists with respect to available-for-sale securities
include: length of time and extent of decline, financial condition and near term
prospects of issuer and intent and ability of Ricoh to retain its investments
for a period of time sufficient to allow for any anticipated recovery in market
value.
The cost of the securities sold is computed based on the average cost of each
security held at the time of sale.
7
Investments in affiliated companies over which Ricoh has the ability to exercise
significant influence, but does not hold a controlling financial interest, are
accounted for by the equity method.
Non-marketable equity securities owned by Ricoh primarily relate to less than
20% owned companies and are stated at cost unless indication of impairment
exist, which require the investment to be written down to its estimated fair
value.
(H) INVENTORIES
Inventories are mainly stated at the lower of average cost or net realizable
values. Inventory costs include raw materials, labor and manufacturing
overheads.
(I) PROPERTY, PLANT AND EQUIPMENT
For the Company and its domestic subsidiaries, depreciation of property, plant
and equipment is computed principally by using the declining-balance method over
the estimated useful lives. Most of the foreign subsidiaries have adopted the
straight-line method for computing depreciation. The depreciation period
generally ranges from 5 years to 50 years for buildings and 2 years to 12 years
for machinery and equipment.
Ordinary maintenance and repairs are charged to expense as incurred. Major
replacements and improvements are capitalized. When properties are retired or
otherwise disposed of, the property and related accumulated depreciation
accounts are relieved of the applicable amounts, and any differences are
included in earnings.
(J) CAPITALIZED SOFTWARE COSTS
In accordance with Statement of Position ("SOP") 98-1, "Accounting for the Costs
of Computer Software Developed or Obtained for Internal Use," Ricoh capitalizes
qualifying cost of computer software. Costs incurred during the application
development stage as well as upgrades and enhancements that results in
additional functionality are capitalized. The capitalized software is amortized
on a straight line basis over their estimated useful lives.
(K) GOODWILL AND OTHER INTANGIBLE ASSETS
SFAS No.141 (revised 2007), "Business Combinations" requires the use of the
acquisition method of accounting for business combinations and refines the
definition of intangible assets acquired in a purchase business combination.
SFAS No.142, "Goodwill and Other Intangible Assets" eliminates the amortization
of goodwill and instead requires goodwill to be tested at least annually for
impairment. SFAS 142 also requires acquired intangible assets with a definite
useful life to be amortized over their respective estimated useful lives and
reviewed for impairment when an indication of impairment is identified in
accordance with SFAS No.144, "Accounting for the Impairment or Disposal of
Long-Lived Assets". Other intangible assets with definite useful lives,
consisting primarily of software, patents, customer relationships and trademarks
are amortized on a straight line basis over 1 year to 20 years. Any acquired
intangible assets determined to have an indefinite useful life are not
amortized, but instead are tested annually for impairment based on its fair
value until its life would be determined to no longer be indefinite.
(L) PENSION AND RETIREMENT ALLOWANCES PLANS
The measurement of pension costs and liabilities is determined in accordance
with SFAS No.87, "Employers' Accounting for Pensions" and SFAS No.158,
"Employers' Accounting for Defined Benefit
8
Pension and Other Postretirement Plans." Under SFAS 158, Ricoh recognized the
funded status (i.e., the difference between the fair value of plan assets and
the projected benefit obligations) of its pension fund plans on the consolidated
balance sheets, with a corresponding adjustment to accumulated other
comprehensive income (loss), net of tax. The expected long-term rate of return
on plan assets used for pension accounting is determined based on the historical
long-term rate of return on plan assets. The discount rate is determined based
on the rates of return of high-quality fixed-income investments currently
available and expected to be available during the period to maturity of the
pension benefits.
(M) INCOME TAXES
Income taxes are accounted for under the asset and liability method. Deferred
tax assets and liabilities are recognized for the future tax consequences
attributable to differences between the financial statement carrying amounts of
existing assets and liabilities and their respective tax bases and operating
loss and tax credit carryforwards. Deferred tax assets and liabilities are
measured using enacted tax rates expected to apply to taxable income in the
years in which those temporary differences and carryforwards are expected to be
realized or settled.
Ricoh applies FIN 48, "Accounting for Uncertainty in Income Taxes - an
Interpretation of FASB Statement No. 109". Ricoh recognizes interest and
penalties accrued related to unrecognized tax benefits in income taxes in the
consolidated statement of income.
(N) RESEARCH AND DEVELOPMENT EXPENSES AND ADVERTISING COSTS
Research and development expenses and advertising costs are expensed as
incurred.
(O) SHIPPING AND HANDLING COSTS
Shipping and handling costs, which mainly include transportation to customers,
are included in selling, general and administrative expenses in the consolidated
statements of income.
(P) IMPAIRMENT OR DISPOSAL OF LONG-LIVED ASSETS
Long-lived assets and acquired intangible assets with a definite life are
reviewed for impairment whenever events or changes in circumstances indicate
that the carrying amount of an asset or asset group may not be recoverable.
Recoverability of assets to be held and used is assessed by comparing the
carrying amount of an asset or asset group to the expected future undiscounted
net cash flows of the asset or asset group. If an asset or asset group is
considered to be impaired, the impairment charge to be recognized is measured as
the amount by which the carrying amount of the asset or asset group exceeds fair
value. Long-lived assets meeting the criteria to be considered as held for sale
are reported at the lower of their carrying amount or fair value less costs to
sell.
(Q) EARNINGS PER SHARE
Basic net income attributable to Ricoh Company, Ltd. per common share is
calculated by dividing net income by the weighted-average number of shares
outstanding during the period. The calculation of diluted net income
attributable to Ricoh Company, Ltd. per common share is similar to the
calculation of basic net income attributable to Ricoh Company, Ltd. per share,
except that the weighted-average number of shares outstanding includes the
additional dilution from potential common stock equivalents such as convertible
bonds.
9
(R) NON-CASH TRANSACTIONS
There were no significant non-cash transactions for the first quarter ended June
30, 2008.
The following non-cash transactions for the first quarter ended June 30, 2009
have been excluded from the consolidated statements of cash flows:
Millions of yen
-------------------
First quarter ended
June 30, 2009
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Debt assumed in connection with business acquisition 3,941
================================================================================
(S) USE OF ESTIMATES
Management of Ricoh has made a number of estimates and assumptions that affect
the reported amounts of assets, liabilities, revenues and expenses, including
impairment losses of long-lived assets and the disclosures of fair value of
financial instruments and contingent assets and liabilities, to prepare these
financial statements in conformity with U.S. generally accepted accounting
principles. Actual results could differ from those estimates.
Ricoh has identified seven areas where it believes assumptions and estimates are
particularly critical to the consolidated financial statements. These are
determination of the allowance for doubtful receivables, impairment of
securities, impairment of long-lived assets including goodwill, uncertain tax
positions, realizability of deferred tax assets, the valuation of assets and
liabilities in purchase business combinations and pension accounting.
(T) RECENTLY ADOPTED NEW ACCOUNTING STANDARDS
In December 2007, the FASB issued SFAS No.141 (revised 2007), "Business
Combinations " ("SFAS 141R"). SFAS 141R establishes principles and requirements
for how an acquirer recognizes and measures in its financial statements the
identifiable assets acquired, the liabilities assumed, any noncontrolling
interest in the acquiree and the goodwill acquired. SFAS 141R also establishes
disclosure requirements to enable the evaluation of the nature and financial
effects of the business combination. SFAS 141R is effective for fiscal years
beginning on or after December 15, 2008 and was adopted by Ricoh in the first
quarter beginning April 1, 2009. The adoption of SFAS 141R did not have a
material effect on Ricoh's consolidated financial position or results of
operations.
In December 2007, the FASB issued SFAS No.160, "Noncontrolling Interests in
Consolidated Financial Statements - an amendment of ARB No. 51." This Statement
requires that the noncontrolling interest in the equity of a subsidiary be
accounted for and reported as equity, provides revised guidance on the treatment
of net income and losses attributable to the noncontrolling interest and changes
in ownership interests in a subsidiary and the valuation of retained
noncontrolling equity investments when a subsidiary is deconsolidated. SFAS 160
also requires additional disclosures that identify and distinguish between the
interests of the controlling and noncontrolling owners. Pursuant to the
transition provisions of SFAS 160, Ricoh will adopt SFAS 160 in fiscal year 2009
via retrospective application of the presentation and disclosure requirements.
In accordance with SFAS 160, noncontrolling interest which were previously
referred to as minority interests and classified between total liabilities and
shareholders' investment on the consolidated balance sheets, are now included as
a separate component of total equity. In addition, consolidated net income on
the consolidated statements of income now includes the net income (loss)
attributable to noncontrolling interest. These financial statement presentation
requirements have been
10
adopted retrospectively and prior year amounts in the consolidated financial
statements of cash flows have been reclassified or adjusted to conform to SFAS
160.
In May 2009, the FASB issued SFAS No.165, "Subsequent Events." SFAS 165 is
intended to establish general standards of accounting for and disclosure of
events that occur after the balance sheet date but before financial statements
are issued or are available to be issued. It requires the disclosure of the date
through which an entity has evaluated subsequent events and the basis for that
date -- that is, whether that date represents the date the financial statements
were issued or were available to be issued. SFAS 165 is effective for fiscal
years ended after June 15, 2009, and interim periods within those fiscal years.
SFAS 165 was be adopted by Ricoh in the first quarter beginning April 1, 2009.
The adoption of SFAS 165 did not have any effect on Ricoh's consolidated
financial position or results of operations.
In April 2008, the FASB finalized FSP 142-3, "Determination of the Useful Life
of Intangible Assets". The position amends the factors that should be considered
in developing renewal or extension assumptions used to determine the useful life
of a recognized intangible asset under SFAS 142. The position applies to
intangible assets that are acquired individually or with a group of other assets
and both intangible assets acquired in business combinations and asset
acquisitions. FSP 142-3 is effective for fiscal years beginning after December
15, 2008, and was adopted by Ricoh in the first quarter beginning April 1, 2009.
The adoption of SFAS 142-3 did not have a material effect on Ricoh's
consolidated financial position or results of operations.
(U) NEW ACCOUNTING STANDARDS NOT YET ADOPTED
In June 2009, the FASB issued SFAS No.166, "Accounting for Transfers of
Financial Assets-an amendment of FASB Statement No. 140." This statement
eliminates the concept of a qualifying special-purpose entity ("QSPE"),
establishes conditions for reporting a transfer of a portion of a financial
asset as a sale, clarifies the financial-asset derecognition criteria, revises
how interests retained by the transferor in a sale of financial assets initially
are measured, removes the guaranteed mortgage securitization recharacterization
provisions and requires additional disclosures. SFAS 166 is effective for fiscal
years beginning after November 15, 2009 and for subsequent interim and annual
reporting periods. SFAS 166 will be adopted by Ricoh in the first quarter
beginning April 1, 2010. Ricoh is currently evaluating the effect that the
adoption of SFAS 166 will have on its consolidated results of operations and
financial condition.
In June 2009, the FASB issued SFAS No.167, "Amendments to FASB Interpretation
No. 46(R)". This statement requires reporting entities to evaluate former QSPEs
for consolidation, changes the approach to determining a VIE's primary
beneficiary from a mainly quantitative assessment to an exclusively qualitative
assessment designed to identify a controlling financial interest, and increases
the frequency of required reassessments to determine whether a company is the
primary beneficiary of a VIE. SFAS 167 is effective for fiscal years beginning
after November 15, 2009 and for subsequent interim and annual reporting periods.
Earlier application is prohibited. SFAS 167 will be adopted by Ricoh in the
first quarter beginning April 1, 2010. Ricoh is currently evaluating the effect
that the adoption of SFAS 167 will have on its consolidated results of
operations and financial condition.
In December 2008, the FASB issued FSP No. FAS 132(R)-1, "Employer's Disclosures
about Postretirement Benefit Plan Assets." FSP FAS 132(R)-1 requires additional
disclosures about assets held in an employer's defined benefit pension or other
postretirement plan. FSP FAS 132(R)-1 is effective for fiscal years ending after
December 15, 2009 and will be adopted by Ricoh in the first quarter beginning
April 1, 2010. Ricoh is currently evaluating the requirements of these
additional disclosures, but does not expect the adoption of FSP FAS 132(R)-1 to
have an impact on its consolidated results of operations and financial
condition.
11
(V) RECLASSIFICATIONS
Certain reclassifications have been made to the prior year's consolidated
financial statement to confirm with the presentation used for the first quarter
ended June 30, 2009.
In accordance with SFAS 160, noncontrolling interest which were previously
referred to as minority interests and classified between total liabilities and
shareholders' investment on the consolidated balance sheets, are now included as
a separate component of total equity. In addition, consolidated net income on
the consolidated statements of income now includes the net income (loss)
attributable to noncontrolling interest.
Purchase of business, net of cash acquired which was included in other, net of
"CASH FLOWS FROM INVESTING ACTIVITIES" on the consolidated statements of cash
flows for the first quarter ended June 30, 2008, are shown separately from the
first quarter ended June 30, 2009.
12
2. SECURITIES
Marketable securities and investment securities as of June 30, 2009 and
March 31, 2009 consist of the following:
Millions of Yen
------------------------------
June 30, 2009 March 31, 2009
--------------------------------------------------------------------------------
Marketable securities:
Trading securities -- 725
--------------------------------------------------------------------------------
Investment securities:
Available-for-sale securities 53,150 46,341
Non-marketable equity securities 1,474 1,474
--------------------------------------------------------------------------------
54,624 47,815
================================================================================
The current and non-current security types of available-for-sale securities, and
the respective cost, gross unrealized holding gains, gross unrealized holding
losses and fair value as of June 30, 2009 and March 31, 2009 are as follows:
Millions of Yen
-------------------------------------------------------------------------------------
June 30, 2009 March 31, 2009
----------------------------------------- -----------------------------------------
Gross Gross Gross Gross
unrealized unrealized unrealized unrealized
holding holding Fair holding holding Fair
Cost gains losses value Cost gains losses value
------------------------------------------------------------------------------------------------------------
Non-current:
Equity securities 42,683 9,269 660 51,292 43,002 2,650 590 45,062
Corporate debt
securities 1,822 36 -- 1,858 1,279 0 -- 1,279
------------------------------------------------------------------------------------------------------------
44,505 9,305 660 53,150 44,281 2,650 590 46,341
============================================================================================================
Gross unrealized holding losses and the fair value of available-for-sale
securities, aggregated by investment category and length of time that individual
securities have been in a continuous unrealized loss position at June 30, 2009
are as follows:
Millions of Yen
---------------------------------------------------------------------------
Less than 12 months 12 months or longer Total
----------------------- ----------------------- -----------------------
Gross Gross Gross
unrealized unrealized unrealized
holding holding holding
Fair value losses Fair value losses Fair value losses
----------------------------------------------------------------------------------------------------
Noncurrent:
Available-for-sale:
Equity securities 1,703 546 514 114 2,218 660
====================================================================================================
Ricoh judged the decline in fair value of investment securities at yearend to be
temporary, with considering such factors as financial and operating conditions
of issuer, the industry in which the issuer operates and other relevant factors.
The contractual maturities of debt securities classified as available-for-sale
as of June 30, 2009 are as follows:
13
Millions of Yen
------------------
Cost Fair value
--------------------------------------------------------------------------------
Due after one year through five years 459 464
Over five years 1,363 1,394
--------------------------------------------------------------------------------
1,822 1,858
================================================================================
Proceeds from the sales of available-for-sale securities were Yen 224 million
and Yen 910 million for the first quarter ended June 30, 2008 and 2009,
respectively.
There were no significant realized gains or losses on sales of
available-for-sale securities for the first quarter ended June 30, 2008 and
2009.
There were no significant realized gains or losses on valuation of
available-for-sale securities for the first quarter ended June 30, 2008 and
2009.
3. INCOME TAXES
The estimated annual effective tax rate for fiscal year 2009 was approximately
55 percent as of June 30, 2009. The estimated rate differed from the
approximately 41 percent statutory tax rate due primarily to the net increase in
valuation allowance for deferred tax assets.
4. EQUITY
The change in Ricoh shareholders' equity, noncontrolling interest and total
equity for the three months ended June 30, 2008 and 2009 is as follow:
Ricoh adopted the measurement date provisions of SFAS 158 on April 1, 2008. The
adoption of the measurement date provisions resulted in adjustments to change in
Ricoh shareholders' equity and total equity as of April 1, 2008.
Millions of Yen
---------------------------------------------------------------------------------------
First quarter ended June 30, 2008 First quarter ended June 30, 2009
------------------------------------------ ------------------------------------------
Ricoh Ricoh
Shareholders' Noncontrolling Total Shareholders' Noncontrolling Total
Equity Interest Equity Equity Interest Equity
---------------------------------------------------------------------------------------------------------------------------------
Equity, Beginning of Period 1,080,196 58,283 1,138,479 975,373 48,977 1,024,350
---------------------------------------------------------------------------------------------------------------------------------
Cumulative effect of adjustment
from applying measurement date
provisions of SFAS No.158, net
of tax (649) -- (649) -- -- --
---------------------------------------------------------------------------------------------------------------------------------
Equity, Beginning of Period as adjusted 1,079,547 58,283 1,137,830 975,373 48,977 1,024,350
---------------------------------------------------------------------------------------------------------------------------------
Net income 25,743 1,174 26,917 903 637 1,540
Unrealized gains on securities 2,303 32 2,335 3,472 43 3,515
Pension liability adjustments 1,656 26 1,682 2,800 25 2,825
Unrealized gains (losses) on
derivatives 381 90 471 (351) (1) (352)
Foreign currency translation
adjustments 25,477 85 25,562 5,779 24 5,803
---------------------------------------------------------------------------------------------------------------------------------
Comprehensive income 55,560 1,407 56,967 12,603 728 13,331
---------------------------------------------------------------------------------------------------------------------------------
Cash dividends on Common stock (12,256) -- (12,256) (10,885) -- (10,885)
Distributions to Noncontrolling
interest -- (407) (407) -- (282) (282)
Payment to acquire Treasury stock (39) -- (39) (23) -- (23)
Other (1) (55) (56) (2) -- (2)
---------------------------------------------------------------------------------------------------------------------------------
Equity, End of Period 1,122,811 59,228 1,182,039 977,066 49,423 1,026,489
=================================================================================================================================
14
5. DIVIDENDS
Cash dividends paid during the first quarter ended June 30, 2009 is as follows:
Resolved at the General meetings of Shareholders on June 25, 2009
--------------------------------------------------------------------------------
Total amount of dividends (million of yen) 10,885
Dividend per share of common stock (yen) 15.00
Record date March 31, 2009
Effective date June 26, 2009
Resource for dividend Retained earnings
================================================================================
6. PER SHARE DATA
Ricoh shareholders' equity per share was Yen 1,346.45 and Yen 1,344.08 as of
June 30, 2009 and March 31, 2009, respectively. Dividends per share shown in the
consolidated statement of income are computed based on dividends paid for the
first quarter ended June 30, 2009 and the year ended March 31, 2009.
A reconciliation of the numerator and the denominators of the basic and diluted
per share computations for net income attributable to Ricoh Company, Ltd. are as
follows:
Thousands of shares
-----------------------------------------
First quarter ended First quarter ended
June 30, 2008 June 30, 2009
---------------------------------------------------------------------------------------------
Weighted average number of shares of common stock 720,932 725,680
outstanding
Effect of dilutive securities:
Euro Yen Zero Coupon Convertible Bonds
- Due December 2011 19,741 19,741
---------------------------------------------------------------------------------------------
Diluted shares of common stock outstanding 740,673 745,421
=============================================================================================
Millions of Yen
-----------------------------------------
First quarter ended First quarter ended
June 30, 2008 June 30, 2009
---------------------------------------------------------------------------------------------
Net income attributable to Ricoh Company, Ltd. 25,743 903
Effect of dilutive securities:
Euro Yen Zero Coupon Convertible Bonds
- Due December 2011 (6) (6)
---------------------------------------------------------------------------------------------
Diluted net income 25,737 897
=============================================================================================
15
Yen
-----------------------------------------
First quarter ended First quarter ended
June 30, 2008 June 30, 2009
---------------------------------------------------------------------------------------------
Earnings per share:
Basic 35.71 1.24
Diluted 34.75 1.20
=============================================================================================
16
7. DERIVATIVE FINANCIAL INSTRUMENTS
Risk Management Policy
Ricoh enters into various derivative financial instrument contracts in the
normal course of business in connection with the management of its assets and
liabilities.
Ricoh uses derivative instruments to reduce risk and protect market value of
assets and liabilities in conformity with the Ricoh's policy. Ricoh does not use
derivative financial instruments for trading or speculative purposes, nor is it
a party to leveraged derivatives.
All derivative instruments are exposed to credit risk arising from the inability
of counterparties to meet the terms of the derivative contracts. However, Ricoh
does not expect any counterparties to fail to meet their obligations because
these counterparties are financial institutions with satisfactory credit
ratings. Ricoh utilizes a number of counterparties to minimize the concentration
of credit risk.
Foreign Exchange Risk Management
Ricoh conducts business on a global basis and holds assets and liabilities
denominated in foreign currencies. Ricoh enters into foreign exchange contracts
and foreign currency options to hedge against the potentially adverse impacts of
foreign currency fluctuations on these assets and liabilities denominated in
foreign currencies.
Interest Rate Risk Management
Ricoh enters into interest rate swap agreements to hedge against the potential
adverse impacts of changes in fair value or cash flow fluctuations on interest
of its outstanding debt.
Fair Value Hedges
Changes in the fair value of derivative instruments and the related hedged items
designated and qualifying as fair value hedges are included in other (income)
expenses in the consolidated statements of income. There is no hedging
ineffectiveness nor are net gains or losses excluded from the assessment of
hedge effectiveness for the first quarter ended June 30, 2009 as the critical
terms of the interest rate swap match the terms of the hedged debt obligations.
Cash Flow Hedges
Changes in the fair value of derivative instruments designated and qualifying as
cash flow hedges are included in accumulated other comprehensive income (loss)
on the consolidated balance sheets. These amounts are reclassified into earnings
as interest on the hedged loans is paid. There is no hedging ineffectiveness nor
are net gains or losses excluded from the assessment of hedge effectiveness for
the first quarter ended June 30, 2009 as the critical terms of the interest rate
swap match the terms of the hedged debt obligations. Ricoh expects that it will
reclassify into earnings through other (income) expenses during the next 12
months approximately Yen 210 million of the balance of accumulated other
comprehensive loss as of June 30, 2009.
Undesignated Derivative Instruments
Derivative instruments not designated as hedging instruments are held to reduce
the risk relating to the variability in exchange rates on assets and liabilities
denominated in foreign currencies. Changes in the fair value of these
instruments are included in other (income) expenses in the consolidated
statement of income.
17
Contract amounts of derivative instruments at June 30, 2009 are shown in the
following tables:
June 30, 2009 Millions of Yen
--------------------------------------------------------------------------------
Interest rate swap agreements 317,446
Foreign currency contracts 136,116
Foreign currency options 22,910
================================================================================
The location and fair value amounts of derivatives in consolidated balance sheet
are shown in the following tables:
Derivatives designated as hedging instruments under SFAS No. 133
Millions of Yen
------------------------------------------------------------
Current Long-term
----------------------------- ----------------------------
Balance Sheet Balance Sheet
Location Fair Value Location Fair Value
-----------------------------------------------------------------------------------------------
Asset Derivatives
Deferred income Lease deposits
Interest rate swap agreements taxes and other 29 and other 135
-----------------------------------------------------------------------------------------------
Liability Derivatives
Accrued expenses Deferred income
Interest rate swap agreements and other 6 taxes and other 1,553
===============================================================================================
Derivatives not designated as hedging instruments under SFAS No. 133
Millions of Yen
------------------------------------------------------------
Current Long-term
----------------------------- ----------------------------
Balance Sheet Balance Sheet
Location Fair Value Location Fair Value
-----------------------------------------------------------------------------------------------
Asset Derivatives
Foreign currency contracts Deferred income 617 --
Foreign currency options taxes and other 96 --
-----------------------------------------------------------------------------------------------
Total 713 --
-----------------------------------------------------------------------------------------------
Liability Derivatives
Interest rate swap agreements 8 380
Foreign currency contracts Accrued expenses 1,985 Deferred income 864
Foreign currency options and other 495 taxes and other --
-----------------------------------------------------------------------------------------------
Total 2,488 1,244
===============================================================================================
Millions of
Yen
-----------
Fair Value
--------------------------------------------------------------------------------
Total Asset Derivatives 877
Total Liability Derivatives 5,291
================================================================================
18
The location and amount of gains and losses related to derivatives reported in
the consolidated statement of income for the first quarter ended June 30, 2009
are shown in the following tables:
Derivatives designated as hedging instruments under SFAS No. 133
Millions of Yen
-----------------------------------------------------------------------------------------------
Gain or (Loss)
Recognized in OCI Gain or (Loss) Reclassified from
on Derivative Accumulated OCI Into Income Gain or (Loss) Recognized in Income on
(Effective Portion) (Effective Portion) Derivative (Ineffective Portion)
-----------------------------------------------------------------------------------------------
Amount Location Amount Location Amount
-------------------------------------------------------------------------------------------------------------------------------
Cash flow hedge
Interest rate swap agreements (368) Interest expense (16) -- --
===============================================================================================================================
Millions of Yen
---------------------------------------------------------
Gain or (Loss) Recognized Gain or (Loss) on Hedged Item
in Income on Derivative Recognized in Income
---------------------------------------------------------
Location Amount Location Amount
-----------------------------------------------------------------------------------------
Fair value hedge
Interest rate swap agreements Interest income 52 Interest expense (91)
=========================================================================================
Derivatives not designated as hedging instruments under SFAS No. 133
Millions of Yen
---------------------
Location Amount
--------------------------------------------------------------------------------
Interest rate swap agreements Other income 23
Foreign currency contracts Other income 230
Foreign currency options Other income 1,044
--------------------------------------------------------------------------------
Total 1,297
================================================================================
8. COMMITMENTS AND CONTINGENT LIABILITIES
Ricoh was contingently liable for certain guarantees including employees housing
loans of Yen 298 million as of June 30, 2009.
As of June 30, 2009 the Company and certain of its subsidiaries were parties to
litigation involving routine matters, such as patent rights. In the opinion of
management, the ultimate liability, if any, resulting from such litigation will
not materially affect the consolidated financial position or the results of
operations of Ricoh.
19
9. DISCLOSURES ABOUT THE FAIR VALUE OF FINANCIAL INSTRUMENTS
(A) CASH AND CASH EQUIVALENTS, TIME DEPOSITS, TRADE RECEIVABLES, SHORT-TERM
BORROWINGS, CURRENT MATURITIES OF LONG-TERM INDEBTEDNESS, TRADE PAYABLES
AND ACCRUED EXPENSES
The carrying amounts approximate fair values because of the short maturities of
these instruments.
(B) MARKETABLE SECURITIES AND INVESTMENT SECURITIES
The fair value of the marketable securities and investment securities is
principally based on quoted market price.
(C) INSTALLMENT LOANS
The fair value of installment loans is based on the present value of future cash
flows using the current interest rate for similar instruments of comparable
maturity.
(D) LONG-TERM INDEBTEDNESS
The fair value of each of the long-term indebtedness instruments is based on the
present value of future cash flows associated with each instrument discounted
using the current borrowing rate for similar instruments of comparable maturity.
(E) INTEREST RATE SWAP AGREEMENTS
The fair value of interest rate swap agreements is estimated by obtaining quotes
from brokers.
(F) FOREIGN CURRENCY CONTRACTS AND FOREIGN CURRENCY OPTIONS
The fair value of foreign currency contracts and foreign currency options is
estimated by obtaining quotes from brokers.
The estimated fair value of the financial instruments as of June 30, 2009 and
March 31, 2009 are summarized as follows:
Millions of Yen
---------------------------------------------
June 30, 2009 March 31, 2009
--------------------- ---------------------
Carrying Estimated Carrying Estimated
amount fair value amount fair value
----------------------------------------------------------------------------------
Marketable securities and
Investment securities 54,624 54,624 48,540 48,540
Installment loans 62,969 62,968 60,781 60,754
Long-term indebtedness (551,049) (542,746) (509,403) (500,774)
Interest rate swap agreements, net (1,783) (1,783) (1,031) (1,031)
Foreign currency contracts, net (2,232) (2,232) (2,994) (2,994)
Foreign currency options, net (399) (399) (1,443) (1,443)
==================================================================================
20
Limitations: Fair value estimates are made at a specific point in time, based on
relevant market information and information about the financial instrument.
These estimates are subjective in nature and involve uncertainties and matters
of significant judgment and therefore cannot be determined with precision.
Changes in assumptions could significantly affect the estimates.
10. FAIR VALUE MEASUREMENTS
SFAS 157 defines fair value as the price that would be received to sell an asset
or paid to transfer a liability in an orderly transaction between market
participants at the measurement date. SFAS 157 establishes a three-level fair
value hierarchy that prioritizes the inputs used to measure fair value.
Pursuant to the provisions of FSP 157-2, Ricoh adopted SFAS 157 for nonfinancial
assets and nonfinancial liabilities that are recognized or disclosed at fair
value in the financial statements on a nonrecurring basis in the first quarter
beginning April 1, 2009.
During the three months ended June 30, 2009, there were no circumstances that
required any nonfinancial assets or nonfinancial liabilities that are not
measured at fair value in the financial statements on a nonrecurring basis.
The three levels of inputs used to measure fair value are as follows:
Level 1 - Inputs are quoted prices in active markets for identical assets or
liabilities.
Level 2 - Inputs are quoted prices for similar assets or liabilities in an
active market, quoted prices for identical or similar assets or
liabilities in markets that are not active, inputs other than quoted
prices that are observable and market-corroborated inputs which are
derived principally from or corroborated by observable market data.
Level 3 - Inputs are derived from valuation techniques in which one or more
significant inputs or value drivers are unobservable.
The following table presents the fair-value hierarchy levels of Ricoh's assets
and liabilities that are measured at fair value on a recurring basis as of June
30, 2009 and March 31, 2009.
Millions of Yen
------------------------------------
June 30, 2009
------------------------------------
Level 1 Level 2 Level 3 Total
-----------------------------------------------------------------------------------
Assets:
Available-for-sale securities 51,850 -- -- 51,850
Derivative instruments -- 877 -- 877
Other investments -- -- 4,289 4,289
-----------------------------------------------------------------------------------
Total assets 51,850 877 4,289 57,016
===================================================================================
Liabilities:
Derivatives instruments -- 5,291 -- 5,291
-----------------------------------------------------------------------------------
Total liabilities -- 5,291 -- 5,291
===================================================================================
21
Millions of Yen
------------------------------------
March 31, 2009
------------------------------------
Level 1 Level 2 Level 3 Total
-----------------------------------------------------------------------------------
Assets:
Trading and Available-for-sale securities 45,761 -- -- 45,761
Derivative instruments -- 1,359 -- 1,359
Other investments -- -- 4,293 4,293
-----------------------------------------------------------------------------------
Total assets 45,761 1,359 4,293 51,413
===================================================================================
Liabilities:
Derivatives instruments -- 6,827 -- 6,827
-----------------------------------------------------------------------------------
Total liabilities -- 6,827 -- 6,827
===================================================================================
Trading and Available-for-sale securities
Trading and Available-for-sale securities classified Level 1 in the fair value
hierarchy contains marketable securities and bonds. Marketable securities and
bonds are valued using a market approach based on the quoted market prices of
identical instruments in active markets.
Derivative instruments
Ricoh uses foreign exchange contracts, foreign currency options and interest
rate swap agreements to manage exposure to the variability of cash flow. These
derivative instruments are classified as Level 2 in the fair value hierarchy,
since they are valued using observable market data such as LIBOR-based yield
curves.
Other investments
Other investments classified as Level 3 in the fair value hierarchy represent
the retained interests in securitizations of finance lease receivables in which
Ricoh valued using cash flows discounted by an estimated interest rate
reflecting underlying risks. The following table presents a reconciliation of
activity for such retained interests on a net basis.
Millions of Yen
-------------------
First quarter ended
June 30, 2009
-------------------
Other investments
--------------------------------------------------------------------------------
Balance at beginning of period 4,293
Total gains or losses (realized and unrealized)
Included in net income --
Included in other comprehensive income (loss) --
Sales, collections and repurchases, net (4)
--------------------------------------------------------------------------------
Balance at end of period 4,289
================================================================================
Millions of Yen
-------------------
First quarter ended
June 30, 2008
-------------------
Other investments
--------------------------------------------------------------------------------
Balance at beginning of period 5,887
Total gains or losses (realized and unrealized)
Included in net income --
Included in other comprehensive income (loss) --
Sales, collections and repurchases, net (1,601)
--------------------------------------------------------------------------------
Balance at end of period 4,286
================================================================================
22
11. SEGMENT INFORMATION
The operating segments presented below are the segments of Ricoh for which
separate financial information is available and for which a measure of profit or
loss is evaluated regularly by Ricoh's management in deciding how to allocate
resources and in assessing performance.
(A) OPERATING SEGMENT INFORMATION
Millions of Yen
-----------------------------------------
First quarter ended First quarter ended
June 30, 2008 June 30, 2009
------------------------------------------------------------------------------------
Sales-
Imaging & Solutions 455,258 436,820
Industrial Products 34,253 25,648
Other 33,221 29,815
Intersegment transaction (1,158) (894)
------------------------------------------------------------------------------------
Consolidated 521,574 491,389
====================================================================================
Operating Income(Loss)-
Imaging & Solutions 55,418 23,859
Industrial Products 1,006 (354)
Other 513 (278)
Elimination (1) (4)
Unallocated expense (17,186) (17,147)
------------------------------------------------------------------------------------
Consolidated 39,750 6,076
====================================================================================
Other, net 3,985 (2,661)
====================================================================================
Income before Income Taxes and Equity in
Earnings of Affiliates 43,735 3,415
====================================================================================
Unallocated expense represents expenses for corporate headquarters.
Intersegment sales are not separated by operating segment because they are
immaterial.
(B) GEOGRAPHIC INFORMATION
Sales which are attributed to countries based on location of customers for the
first quarter ended June 30, 2008 and 2009 are as follows:
Millions of Yen
-----------------------------------------
First quarter ended First quarter ended
June 30, 2008 June 30, 2009
------------------------------------------------------------------------------------
Sales-
Japan 233,869 206,739
The Americas 101,664 142,770
Europe 148,671 113,750
Other 37,370 28,130
------------------------------------------------------------------------------------
Consolidated 521,574 491,389
====================================================================================
23
(C) ADDITIONAL INFORMATION
The following information shows net sales and operating income recognized by
geographic origin for the first quarter ended June 30, 2008 and 2009. In
addition to the disclosure requirements under SFAS No.131, "Disclosure about
Segments of an Enterprise and Related Information," Ricoh discloses this
information as supplemental information in light of the disclosure requirements
of the Japanese Financial Instrument and Exchange Law, which a Japanese public
company is subject to.
Millions of Yen
-----------------------------------------
First quarter ended First quarter ended
June 30, 2008 June 30, 2009
------------------------------------------------------------------------------------
Sales-
Japan
External customers 241,120 210,421
Intersegment 123,371 90,510
------------------------------------------------------------------------------------
Total 364,491 300,931
------------------------------------------------------------------------------------
The Americas
External customers 101,285 142,656
Intersegment 1,224 638
------------------------------------------------------------------------------------
Total 102,509 143,294
------------------------------------------------------------------------------------
Europe
External customers 148,256 114,516
Intersegment 723 604
------------------------------------------------------------------------------------
Total 148,979 115,120
------------------------------------------------------------------------------------
Other
External customers 30,913 23,796
Intersegment 43,927 33,897
------------------------------------------------------------------------------------
Total 74,840 57,693
------------------------------------------------------------------------------------
Elimination of intersegment sales (169,245) (125,649)
------------------------------------------------------------------------------------
Consolidated 521,574 491,389
====================================================================================
Operating Income(Loss)-
Japan 26,076 2,590
The Americas (1,213) (4,733)
Europe 11,669 5,258
Other 4,567 2,400
------------------------------------------------------------------------------------
Elimination of intersegment sales (1,349) 561
------------------------------------------------------------------------------------
Consolidated 39,750 6,076
====================================================================================
Other, net 3,985 (2,661)
====================================================================================
Income before Income Taxes and Equity in
Earnings of Affiliates 43,735 3,415
====================================================================================
Intersegment sales between geographic areas are made at cost plus profit.
Operating income by geographic area is sales less expense related to the area's
operating revenue.
No single customer accounted for 10% or more of the total revenues for the first
quarter ended June 30, 2008 and 2009.
24
12. SUPPLEMENTARY INFORMATION TO THE STATEMENT OF INCOME
The following amounts were charged to selling, general and administrative
expenses for the first quarter ended June 30, 2008 and 2009:
Millions of Yen
-----------------------------------------
First quarter ended First quarter ended
June 30, 2008 June 30, 2009
------------------------------------------------------------------------------------
Research and development costs 31,797 27,280
Advertising costs 3,340 1,981
Shipping and handling costs 5,824 4,266
====================================================================================
13. SUBSEQUENT EVENTS
There had been no significant subsequent event through August 7, 2009, which is
the date the financial statements were issued.
25