RNS Number:5266W
Pioneer Corporation
14 May 2007
For Immediate Release
May 14, 2007
Pioneer Announces Business Results for Fiscal 2007
TOKYO - Pioneer Corporation today announced its business results on
consolidated and non-consolidated bases for fiscal 2007, ended March 31, 2007.
Consolidated Financial Highlights
(In millions of yen except per share information)
Year ended March 31
2007 2006 % to
prior year
Operating revenue Y797,102 Y754,964 105.6%
Operating income (loss) 12,487 (16,409) -
Income (loss) from continuing operations
before income taxes (7,717) (71,165) -
Income (loss) from continuing operations (9,536) (85,758) -
Income from discontinued operations,
net of tax 2,775 772 359.5
Net income (loss) Y (6,761) Y (84,986) -%
Basic net income (loss) per share:
Income (loss) from continuing operations Y(54.67) Y(491.66)
Income from discontinued operations,
net of tax 15.91 4.43
Net income (loss) Y(38.76) Y(487.23)
Diluted net income (loss) per share:
Income (loss) from continuing operations Y(54.67) Y(491.66)
Income from discontinued operations,
net of tax 15.91 4.43
Net income (loss) Y(38.76) Y(487.23)
Note:In fiscal 2006, the Company sold a subsidiary engaged in the development of
cable TV software, and in fiscal 2007, sold subsidiaries involved in the
electronic components business. The operating results of these subsidiaries and
the gain on the sales are presented as income from discontinued operations in
the table above.
For further information, please contact:
Investor Relations Department, Corporate Branding and Communications Division
Pioneer Corporation, Tokyo
Phone: +81-3-3495-6773 / Fax: +81-3-3495-4301
E-mail: pioneer_ir@post.pioneer.co.jp
IR Website: http://pioneer.jp/ir-e/
Consolidated Business Results
In fiscal 2007, the year ended March 31, 2007, consolidated operating revenue
rose 5.6% year on year to Y797,102 million (US$6,755.1 million). This increase
mainly reflected higher sales of car navigation systems and DVD drives and the
weaker yen, despite a drop in sales of DVD recorders.
Operating income was Y12,487 million (US$105.8 million), compared with an
operating loss of Y16,409 million in the previous fiscal year. This was due
chiefly to higher sales, as well as an improved gross profit margin and lower
selling, general and administrative expenses due to the benefits of business
restructuring measures and the weaker yen. On the other hand, the net loss was
Y6,761 million (US$57.3 million) due mainly to impairment losses on property,
plant and equipment mainly for plasma displays. Meanwhile, the net loss in the
previous fiscal year was Y84,986 million, mainly attributable to expenses and
losses accompanying the implementation of business restructuring measures.
During fiscal 2007, the average value of the Japanese yen was weaker against the
U.S. dollar and the euro by 3.2% and 8.1%, respectively, compared with fiscal
2006.
Home Electronics sales increased 3.9% year on year to Y368,622 million
(US$3,123.9 million). Plasma display sales declined slightly due to a drop in
overall OEM (original equipment manufacturing) sales, despite increased sales of
own-brand models in Europe and North America. Plasma display sales accounted for
approximately 48% of Home Electronics sales. Meanwhile, sales of DVD drives,
DVD-related devices and DJ equipment rose, while sales of DVD recorders fell
year on year.
In terms of geographic sales, sales in Japan declined 19.7% to Y65,851 million
(US$558.1 million), while overseas sales increased 11.0% to Y302,771 million
(US$2,565.9 million).
The operating loss in this segment was Y16,236 million (US$137.6 million),
improving from an operating loss of Y35,184 million in the previous fiscal year.
This was mainly attributable to an improved gross profit margin mainly for
plasma displays, largely due to the benefits of business restructuring measures.
Car Electronics sales increased 8.3% year on year to Y357,809 million
(US$3,032.3 million) due to higher sales of both car navigation systems and car
audio products. In car navigation systems, consumer-market sales rose mainly in
Japan and OEM sales also increased mainly in North America. In car audio
products, consumer-market sales increased in Central and South America and
Russia, while OEM sales declined in North America, but rose in Japan and China.
Total OEM sales in this segment accounted for approximately 36% of Car
Electronics sales in fiscal 2007.
In terms of geographic sales, sales in Japan rose 7.4% to Y126,278 million
(US$1,070.2 million) and overseas sales increased 8.7% to Y231,531 million
(US$1,962.1 million).
Operating income in this segment rose 26.5% to Y22,116 million (US$187.4
million). This increase principally reflected sales growth and cost reductions
achieved by reorganizing our production sites.
In Patent Licensing, royalty revenue decreased 45.4% year on year to Y4,661
million (US$39.5 million). This decrease was attributable to the impact of the
expiration of some patents licensed to the optical disc industry.
Operating income in this segment declined 45.6% to Y3,924 million (US$33.3
million).
In the Others segment, sales rose 7.8% year on year to Y66,010 million (US$559.4
million). This mainly reflected higher sales of factory automation systems and
passive-matrix organic light-emitting diode (OLED) displays, despite lower sales
of speaker units for cellular phones.
In terms of geographic sales, sales in Japan increased 24.9% to Y41,490 million
(US$351.6 million), while overseas sales were down 12.4% at Y24,520 million
(US$207.8 million).
Operating income in this segment was Y2,875 million (US$24.4 million) compared
with an operating loss of Y3,991 million in the previous fiscal year. This
improvement was mainly attributable to improved profitability in OLED displays
primarily due to the benefits of business restructuring measures.
Note:Operating income (loss) in each business segment represents operating
income (loss) before elimination of intersegment transactions.
Cash Flows
During fiscal 2007, operating activities provided net cash of Y16,752 million
(US$142.0 million). This was due mainly to adjustments for non-cash expenses,
such as depreciation and amortization of Y41,127 million (US$348.5 million) and
impairment losses of Y22,711 million (US$192.5 million) on property, plant and
equipment, despite the net loss of Y6,761 million (US$57.3 million) and a
decrease in accounts payable and accrued liabilities of Y24,285 million
(US$205.8 million). Investing activities used net cash of Y16,468 million
(US$139.6 million). This reflected Y41,932 million (US$355.4 million) mainly for
capital expenditures related to car electronics products and plasma displays,
partially offset by an advance of Y14,112 million (US$119.6 million) for the
sale of all land and buildings at the Tokorozawa Plant and some at the Omori
Plant and by proceeds of Y10,949 million (US$92.8 million) from the sale of
subsidiaries. Financing activities used net cash of Y21,673 million (US$183.7
million), mainly for repayments of loans.
Consequently, cash and cash equivalents at March 31, 2007 were Y101,820 million
(US$862.9 million), Y19,860 million lower than at March 31, 2006.
Dividends
Pioneer positions its dividend policy as one of its highest management
priorities. On the basis of maintaining stable dividends, the Company sets
dividend payments appropriately in light of its financial position, consolidated
business results, and other factors. Retained earnings are effectively used
primarily to develop businesses, as well as reinforce competitiveness and our
management base.
Based on this dividend policy, Pioneer has decided to pay a year-end dividend
for fiscal 2007 of Y5.0 (US$0.04) per share of common stock, subject to approval
by the ordinary general meeting of shareholders to be held in June 2007. The
total annual dividend for fiscal 2007, including the interim dividend, will be Y
10.0 per share.
Business Forecasts for Fiscal 2008
Consolidated business forecasts for fiscal 2008, the year ending March 31, 2008,
are as follows:
(In millions of yen)
First half Full year
Projections Results Percent Projections Results for Percent
for for changes for fiscal 2007 changes
fiscal 2008 fiscal fiscal 2008
2007
Operating revenue Y368,000 Y380,319 - Y835,000 Y797,102 +4.8%
3.2%
Operating income (loss) (3,500) 11,691 - 15,000 12,487 +20.1
Income (loss) before
income taxes 9,500 12,624 - 29,000 (7,717) -
24.7
Net income (loss) Y 3,000 Y 9,208 67.4% Y 12,500 Y (6,761) -%
For fiscal 2008, Pioneer is forecasting operating revenue of Y835,000 million on
a full-year basis, an increase of 4.8% year on year. This mainly reflects a
large projected increase in plasma display sales in the Home Electronics
business in the second half of fiscal 2008, due to the launch of products
featuring new panel technologies. Additionally, in the Car Electronics business,
Pioneer anticipates sales growth in the OEM business, and higher sales of car
navigation systems for overseas consumer markets and car audio products for
Central and South America and Russia.
For the full year, we are forecasting a 20.1% year-on-year increase in operating
income to Y15,000 million on expectations of a significant improvement in the
profitability of the Home Electronics business in the second half of fiscal 2008
as we launch new plasma display products. The forecast also factors in the
adverse effects of intensifying competition and falling prices for core
products, tax reforms applicable to depreciation and amortization, and
increasing operating expenses.
Furthermore, Pioneer expects to book a gain of Y12,500 million on the sale of
all land and buildings at the Tokorozawa Plant and some at the Omori Plant in
conjunction with the transfer and concentration of planning, development and
design departments in the Home Electronics business at the newly established
Kawasaki Plant. Due to these and other factors, Pioneer is forecasting income
before income taxes of Y29,000 million and net income of Y12,500 million.
We are assuming average yen-U.S. dollar and yen-euro exchange rates of Y115 and
Y155, respectively.
Cautionary Statement with Respect to Forward-Looking Statements
Statements made in this release with respect to our current plans, estimates,
strategies and beliefs, and other statements that are not historical facts are
forward-looking statements about our future performance. These statements are
based on management's assumptions and beliefs in light of the
information currently available to it. We caution that a number of important
risks and uncertainties could cause actual results to differ materially from
those discussed in the forward-looking statements, and therefore you should not
place undue reliance on them. It is not our obligation to update or revise any
forward-looking statements, whether as a result of new information, future
events or otherwise. We disclaim any such obligation. Risks and uncertainties
that might affect us include, but are not limited to, (i) general economic
conditions in our markets, particularly levels of consumer spending; (ii)
exchange rates, particularly between the yen and the U.S. dollar, euro, and
other currencies in which we make significant sales or in which our assets and
liabilities are denominated; (iii) our ability to continue to design and develop
and win acceptance of our products and services, which are offered in highly
competitive markets characterized by continual new product introductions, rapid
developments in technology, severe price competition and subjective and changing
consumer preferences; (iv) our ability to successfully implement our business
strategies; (v) our ability to compete, as well as develop and implement
successful sales and distribution strategies, in light of technological
developments in and affecting our businesses; (vi) our continued ability to
devote sufficient resources to research and development, and capital
expenditure; (vii) our ability to continuously enhance our brand image; (viii)
the success of our joint ventures and alliances; (ix) the success of our
business restructuring plans; and (x) the outcome of contingencies.
Basic Management Policies and Medium-term Management Strategies
Pioneer positions customer satisfaction at the core of management. We seek to
offer innovative, high-quality, and value-added electronics products that create
new value for customers, aiming to share the Pioneer Group's philosophy,
"Move the Heart and Touch the Soul," with more people around the
world.
Based on this group philosophy, in April 2006 Pioneer formulated a group vision
to guide management over the medium term: "To become a company that
encourages all its members to work as a team, with everyone customer-focused,
integrating each one's professionalism in pursuing innovations one after
another." Through this vision, we believe that we can set a process in
motion where employees fulfill their duties from the customer's
perspective, and come up with ideas that resonate with other employees around
them to give rise to major innovations. This innovation will produce products
that play an integral role in offering new lifestyle proposals and triggering
revolutions in consumers' ways of life.
Pioneer has set, for the fiscal year ending March 31, 2009, management targets
of operating revenue and operating income of Y950 billion and at least Y30
billion, respectively, on a consolidated basis. However, Pioneer faces a more
severe business environment, characterized by further decreases in flat-panel TV
prices, and shrinking consumer markets for car audio products in Japan, North
America and Europe. Accordingly, the Company is currently reviewing its business
strategies.
In the Home Electronics business, we aim to enhance the image of our brands,
providing new forms of value for customers, mainly through plasma displays, in
terms of picture quality, product design, user friendliness, quality, and sound,
while improving earnings by focusing on profitable products.
In the Car Electronics business, Pioneer aims to grow its earnings by allocating
more resources to maintain a leading position in consumer markets and to drive
further expansion in the OEM business, as well as by developing products more
efficiently. Furthermore, Pioneer has taken steps to pave the way for further
business expansion in this segment. In Thailand, we have ramped up production
capacity and established a new product development facility. In China, we are
currently building a new plant due to come on stream in August 2007.
Going forward, we consider the Home Electronics business and Car Electronics
business as our growth drivers, and thus remain focused on improving
profitability in the Home Electronics business and increasing earnings in the
Car Electronics business.
Issues to Be Addressed
The economic outlook is for continued stable growth overall, supported by
favorable corporate earnings and consumer spending, despite some lingering
concerns over surging materials prices. However, Pioneer faces extremely
challenging business conditions such as ongoing price-based competition
involving its core products.
In the plasma display business, Pioneer will leverage its technological edge in
panel technologies to offer outstanding high-resolution plasma displays, as
demand for high-definition panels is projected to increase in step with the
worldwide uptake of HD broadcasting and HD content through media such as Blu-ray
Discs. Efforts will also focus on offering unique value propositions based on
stronger combinations and links between plasma displays and other audio/video
products, and reinforcing Pioneer's brand strategy. In doing so, we aim
to develop businesses with an emphasis on profitability rather than merely
pursuing expansion. This approach will be underpinned by high-definition,
high-quality panel production and continuous cost reductions. At the same time,
we will continue to consider all options for optimizing our production
structure, including rebuilding panel plants and joint investments with other
companies.
In the optical disc business, Pioneer is focusing on Blu-ray Disc products,
having already shifted the core of development from DVD products. Looking ahead,
we will offer new value propositions worldwide based on combinations of Blu-ray
Disc products and plasma displays. In Blu-ray Disc drives for PCs, we aim to
achieve profitability by accelerating the pace of product development.
To generate synergies between plasma displays and other audio/video products,
Pioneer is currently integrating its respective planning, development and design
departments for products in the Home Electronics business at a recently
completed new office in Kawasaki City, Kanagawa Prefecture.
In the Car Electronics business, Pioneer aims to increase earnings in both
consumer and OEM markets.
In car audio products for consumer markets, Pioneer is focusing on fast-growing
markets such as Central and South America and Russia in order to retain its
position of leadership in these products. The Company will also offer products
that stand apart from those of other companies by delivering new value and
functions. In car navigation systems for consumer markets, we will drive further
growth in Japan, where Pioneer's car navigation systems have enjoyed a
strong reputation. Pioneer will also actively press ahead with business
expansion in North America and Europe, through such actions as launching car
navigation systems with built-in audio/video functions in price ranges targeting
broad consumer uptake. Aiming to curb burgeoning software development costs
accompanying product advancements, Pioneer is reforming product development
processes and pursuing sharing and standardization in this area.
In both OEM car audio products and OEM car navigation systems, Pioneer seeks to
drive further business expansion by offering new proposals to customers by
leveraging its product planning capabilities, which have garnered strong support
in consumer markets.
Pioneer Corporation is a leading global manufacturer of consumer- and
business-use electronics products such as audio, video and car electronics. Its
shares are traded on the Tokyo Stock Exchange.
# # # # # #
The U.S. dollar amounts in this release represent translations of Japanese yen,
for convenience only, at the rate of Y118=US$1.00, the approximate rate
prevailing on March 31, 2007.
Attachments:
I.Consolidated financial statements for the year ended March 31, 2007
II.Non-consolidated financial statements for the year ended March 31, 2007
III.Proposed changes in management
I.CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31, 2007
(1) OPERATING REVENUE BY SEGMENT
(In millions of yen)
Year ended March 31
2007 2006 % to
Amount % to total Amount % to total prior year
Domestic Y 65,851 8.3% Y 81,998 10.9% 80.3%
Overseas 302,771 37.9 272,692 36.1 111.0
Home Electronics 368,622 46.2 354,690 47.0 103.9
Domestic 126,278 15.8 117,560 15.6 107.4
Overseas 231,531 29.1 212,962 28.2 108.7
Car Electronics 357,809 44.9 330,522 43.8 108.3
Domestic - - - - -
Overseas 4,661 0.6 8,540 1.1 54.6
Patent Licensing 4,661 0.6 8,540 1.1 54.6
Domestic 41,490 5.2 33,208 4.3 124.9
Overseas 24,520 3.1 28,004 3.8 87.6
Others 66,010 8.3 61,212 8.1 107.8
Domestic 233,619 29.3 232,766 30.8 100.4
Overseas 563,483 70.7 522,198 69.2 107.9
Total Y797,102 100.0% Y754,964 100.0% 105.6%
(2) CONSOLIDATED STATEMENTS OF OPERATIONS
(In millions of yen)
Year ended March 31
2007 2006 % to
prior year
Operating revenue:
Net sales Y792,441 Y746,424 106.2%
Royalty revenue 4,661 8,540 54.6
Total operating revenue 797,102 754,964 105.6
Operating costs and expenses:
Cost of sales 614,444 593,238 103.6
Selling, general and administrative expenses 170,171 178,135 95.5
Total operating costs and expenses 784,615 771,373 101.7
Operating income (loss) 12,487 (16,409) -
Other income (expenses):
Interest income 5,873 2,658 221.0
Foreign exchange loss (2,558) (2,326) 110.0
Interest expense (2,622) (1,479) 177.3
Other -net (20,897) (53,609) 39.0
Total other expenses (20,204) (54,756) 36.9
Loss from continuing operations before income taxes (7,717) (71,165) -
Income taxes 1,758 (4,660) -
Minority interest in losses (earnings) of subsidiaries (404) 4,774 -
Equity in earnings (losses) of affiliated companies 343 (24,027) -
Loss from continuing operations (9,536) (85,758) -
Income from discontinued operations, net of tax 2,775 772 359.5
Net loss Y (6,761) Y (84,986) -%
(3) CONSOLIDATED BALANCE SHEETS
(In millions of yen)
March 31
2007 2006 Increase
(Decrease)
ASSETS
Current assets:
Cash and cash equivalents Y101,820 Y121,680 Y(19,860)
Trade receivables, less allowance 117,875 107,563 10,312
Inventories 105,331 104,226 1,105
Assets held for sale - 25,577 (25,577)
Others 69,066 69,626 (560)
Total current assets 394,092 428,672 (34,580)
Investments and long-term receivables 27,219 29,772 (2,553)
Property, plant and equipment, less depreciation 146,475 160,231 (13,756)
Intangible assets 18,248 20,576 (2,328)
Other assets 49,440 38,795 10,645
Total assets Y635,474 Y678,046 Y(42,572)
LIABILITIES, MINORITY INTERESTS AND SHAREHOLDERS' EQUITY
Current liabilities:
Short-term borrowings and current portion
of long-term debt Y 18,605 Y 30,370 Y(11,765)
Trade payables 93,351 102,082 (8,731)
Liabilities held for sale - 17,863 (17,863)
Others 130,757 121,977 8,780
Total current liabilities 242,713 272,292 (29,579)
Long-term debt 86,015 92,970 (6,955)
Other long-term liabilities 24,341 25,425 (1,084)
Total liabilities 353,069 390,687 (37,618)
Minority interests 14,289 14,109 180
Shareholders' equity:
Common stock 49,049 49,049 -
Capital surplus 82,983 82,910 73
Retained earnings 165,321 173,826 (8,505)
Accumulated other comprehensive loss (16,784) (20,092) 3,308
Treasury stock (12,453) (12,443) (10)
Total shareholders' equity 268,116 273,250 (5,134)
Total liabilities, minority interests and
shareholders' equity Y635,474 Y678,046 Y(42,572)
Breakdown of accumulated other comprehensive loss:
Minimum pension liability adjustments Y (3,680) Y 3,680
Pension liability adjustments Y (5,009) - (5,009)
Net unrealized gains on securities 7,405 10,352 (2,947)
Foreign currency translation adjustments (19,180) (26,764) 7,584
Total accumulated other comprehensive loss Y(16,784) Y(20,092) Y 3,308
(4) CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY
(In millions of yen)
Common Capital Retained Accumulated Treasury Total
Stock Surplus Earnings Other Stock Shareholders'
Comprehensive Equity
Loss
Balance at March 31, 2005 Y49,049 Y82,735 Y260,556 Y(47,669) Y (12,432) Y332,239
Net loss (84,986) (84,986)
Other comprehensive
income 27,577 27,577
Value ascribed to stock
options 175 175
Cash dividends
(Y10 per share) (1,744) (1,744)
Purchase and sales of
treasury stock, net (11) (11)
Balance at March 31, 2006 49,049 82,910 173,826 (20,092) (12,443) 273,250
Net loss (6,761) (6,761)
Other comprehensive
income 3,308 3,308
Value ascribed to stock
options 73 73
Cash dividends
(Y10 per share) (1,744) (1,744)
Purchase and sales of
treasury stock, net (10) (10)
Balance at March 31, 2007 Y49,049 Y82,983 Y165,321 Y(16,784) Y(12,453) Y268,116
(5) CONSOLIDATED STATEMENTS OF CASH FLOWS
(In millions of yen)
Year ended March 31
2007 2006
I. Cash flows from operating activities:
Net loss Y (6,761) Y (84,986)
Depreciation and amortization 41,127 46,703
Decrease (increase) in trade receivables (6,348) 19,329
Decrease in inventories 4,380 9,530
Increase (decrease) in trade payables (11,841) 13,941
Increase (decrease) in other accrued liabilities (12,444) 24,114
Other 8,639 39,698
Net cash provided by operating activities 16,752 68,329
II. Cash flows from investing activities:
Payment for purchase of fixed assets (41,932) (40,325)
Proceed from sale of discontinued operations 10,949 754
Other 14,515 9,812
Net cash used in investing activities (16,468) (29,759)
III. Cash flows from financing activities:
Decrease in short-term borrowings and long-term debt (17,012) (31,204)
Dividends paid (1,308) (3,499)
Decrease in capital-lease obligations (3,149) (3,535)
Other (204) (313)
Net cash used in financing activities (21,673) (38,551)
Effect of exchange rate changes on cash and cash equivalents 1,529 4,980
Net increase (decrease) in cash and cash equivalents (19,860) 4,999
Cash and cash equivalents, beginning of year 121,680 116,681
Cash and cash equivalents, end of year Y101,820 Y121,680
Free cash flow (I + II) Y284 Y38,570
(6) SEGMENT INFORMATION
The following segment information is prepared pursuant to the regulations under
the Securities and Exchange Law of Japan.
(Business Segments)
(In millions of yen)
Year ended March 31
2007 2006 % to prior year
Operating Operating Operating Operating Operating Operating
Revenue Income Revenue Income Revenue Income
Home Electronics Y369,446 Y(16,236) Y356,813 Y(35,184) 103.5% -%
Car Electronics 359,802 22,116 332,101 17,486 108.3 126.5
Patent Licensing 5,423 3,924 10,588 7,217 51.2 54.4
Others 100,287 2,875 98,857 (3,991) 101.4 -
Total 834,958 12,679 798,359 (14,472) 104.6 -
Corporate and Eliminations (37,856) (192) (43,395) (1,937) - -
Consolidated Y797,102 Y 12,487 Y754,964 Y(16,409) 105.6% -%
(Geographic Segments)
(In millions of yen)
Year ended March 31
2007 2006 % to prior year
Operating Operating Operating Operating Operating Operating
Revenue Income Revenue Income Revenue Income
Japan Y 632,730 Y (941) Y604,649 Y(25,832) 104.6% -%
North America 208,914 423 202,970 3,368 102.9 12.6
Europe 180,038 4,945 163,702 3,519 110.0 140.5
Other Regions 350,431 6,580 333,942 3,697 104.9 178.0
Total 1,372,113 11,007 1,305,263 (15,248) 105.1 -
Corporate and Eliminations (575,011) 1,480 (550,299) (1,161) - -
Consolidated Y 797,102 Y12,487 Y 754,964 Y(16,409) 105.6% -%
Notes:
1.The Company's consolidated financial statements have been prepared in
conformity with accounting principles generally accepted in the United States of
America (U.S. GAAP), except for the disclosure of segment information.
2.The Company's business is classified into four segments: "Home
Electronics," "Car Electronics," "Patent
Licensing" and "Others." Principal products and services
included in each segment are as follows:
Home Electronics
plasma displays, DVD recorders, DVD players, DVD drives, Blu-ray Disc players,
Blu-ray Disc drives, audio systems, individual audio components, DJ equipment,
telephones and equipment for cable TV systems
Car Electronics
car navigation systems, car stereos, car AV systems and car speakers
Patent Licensing
licensing of patents related to laser optical disc technologies
Others
organic light-emitting diode (OLED) displays, factory automation systems,
speaker units, electronics devices and parts and business-use AV systems
3.In accordance with the Statement of Financial Accounting Standards ("
SFAS") No. 158, "Employers' Accounting for Defined
Benefit Pension and Other Postretirement Benefits," which is effective
from fiscal 2007, the Company reported the difference between the projected
benefit obligations and the fair value of plan assets in the consolidated
balance sheets, and recognized an adjustment in accumulated other comprehensive
loss net of tax. The effect on accrued pension and severance cost, and on
accumulated other comprehensive loss, was an increase of Y2,795 million and Y
1,783 million, respectively. There was no effect on net income.
4.In fiscal 2006, the Company sold a subsidiary engaged in the development of
cable TV software, and in fiscal 2007, sold subsidiaries involved in the
electronic components business. The operating results of these subsidiaries and
the gain on the sales are presented as income from discontinued operations in
the consolidated statements of operations.
Summarized financial information of the discontinued operations for the years
ended March 31, 2006 and 2007 is as follows:
(In millions of yen)
Year ended March 31
2007 2006
Operating revenue Y10,442 Y30,274
Operating income 425 739
Income before income taxes 324 820
Gain on sales of discontinued operations 2,488 434
Income taxes 37 482
Income from discontinued operations Y2,775 Y772
5.Changes in accumulated other comprehensive loss for the years ended March 31,
2006 and 2007 are as follows:
(In millions of yen)
Minimum Pension Net Foreign Total
Pension Liability Unrealized Currency Accumulated
Liability Adjustments Gains on Translation Other
Adjustments Securities Adjustments Comprehensive
Loss
Balance at March 31, 2005 Y(11,186) - Y 8,250 Y(44,733) Y(47,669)
Adjustments for the year 7,506 - 2,102 17,969 27,577
Balance at March 31, 2006 (3,680) - 10,352 (26,764) (20,092)
Adjustments for the year 454 - (2,947) 7,584 5,091
Adjustments pursuant to
SFAS No. 158 Y 3,226 Y(5,009) - - (1,783)
Balance at March 31, 2007 - Y(5,009) Y 7,405 Y(19,180) Y(16,784)
II.NON-CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31, 2007
(1) CONDENSED STATEMENTS OF OPERATIONS
(In millions of yen)
Year ended March 31
2007 2006 % to
prior year
Net sales Y532,895 Y515,792 103.3%
Cost of sales 468,442 451,320 103.8
Selling, general and administrative expenses 81,730 96,712 84.5
Operating income (loss) (17,277) (32,239) -
Non-operating income -net 5,007 692 722.9
Ordinary income (loss) (12,269) (31,546) -
Other income (expenses) -net (10,518) (13,183) -
Income (loss) before income taxes (22,788) (44,730) -
Income taxes (501) 3,027 -
Net income (loss) Y (22,286) Y (47,757) -%
(2) CONDENSED BALANCE SHEETS
(In millions of yen)
March 31
2007 2006 Increase
(Decrease)
ASSETS
Current assets:
Cash Y30,367 Y50,305 Y(19,937)
Notes and accounts receivable -trade 50,462 46,034 4,427
Inventories 28,630 30,015 (1,385)
Other current assets 44,733 40,105 4,627
Total current assets 154,192 166,461 (12,268)
Fixed assets:
Tangible 63,904 55,537 8,366
Intangible 31,348 28,752 2,595
Investments and others 190,518 201,979 (11,461)
Total fixed assets 285,770 286,269 (498)
Total assets Y439,963 Y452,730 Y(12,766)
LIABILITIES
Current liabilities:
Notes and accounts payable -trade Y52,701 Y 56,175 Y(3,474)
Accrued expenses 55,787 61,190 (5,403)
Other current liabilities 63,050 40,512 22,537
Total current liabilities 171,538 157,879 13,659
Long-term liabilities 72,019 73,351 (1,331)
Total liabilities 243,558 231,230 12,328
SHAREHOLDERS' EQUITY
Common stock - 49,048 (49,048)
Capital surplus - 81,315 (81,315)
Retained earnings - 96,169 (96,169)
Net unrealized gains on securities - 7,409 (7,409)
Treasury stock - (12,442) 12,442
Total shareholders' equity - 221,500 (221,500)
Total liabilities and shareholders' equity - Y452,730 452,730
NET ASSETS
Shareholders' equity:
Common stock 49,048 - 49,048
Capital surplus 81,314 - 81,314
Retained earnings 72,574 - 72,574
Treasury stock (12,452) - (12,452)
Total shareholders' equity 190,485 - 190,485
Adjustments to valuation and translation
Net unrealized gains on securities 6,041 - 6,041
Deferred gains (losses) on hedges (121) - (121)
Total adjustments to valuation and translation 5,920 - 5,920
Total net assets 196,405 - 196,405
Total liabilities and net assets Y439,963 - Y439,963
(3) CONDENSED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY
(In millions of yen)
Shareholders' Equity
Common Capital Retained Treasury Total
Stock Surplus Earnings Stock Shareholders'
Equity
Balance at March 31, 2006 Y49,048 Y81,315 Y96,169 Y(12,442) Y214,090
Dividends paid (1,308) (1,308)
Net loss (22,286) (22,286)
Purchase and sales of
treasury stock, net 0 (10) (10)
Net change in items other
than shareholders' equity -
Balance at March 31, 2007 Y49,048 Y81,314 Y72,574 Y(12,452) Y190,485
Adjustments to Total
Valuation and Translation Net Assets
Net Deferred Total
Unrealized Gains Adjustments
Gains on (Losses) to Valuation
Securities on Hedges and
Translation
Balance at March 31, 2006 Y 7,409 - Y 7,409 Y221,500
Dividends paid - (1,308)
Net loss - (22,286)
Purchase and sales of
treasury stock, net (10)
Net change in items other
than shareholders' equity (1,368) Y(121) (1,489) (1,489)
Balance at March 31, 2007 Y 6,041 Y(121) Y 5,920 Y196,405
III. Proposed Changes in Management (Previously Announced on April 18, 2007)
Pioneer has announced the following proposed changes in management, which are
subject to approval by the ordinary general meeting of shareholders to be held
on June 28, 2007.
(1)Mr. Hajime Ishizuka, currently Senior Managing Director and Representative
Director, will be promoted to Executive Vice President and Representative
Director.
(2)Candidates for directors to be newly elected:
- Mr. Hideki Okayasu, currently Senior Executive Officer, and General
Manager of Finance and Accounting Division and President and Representative
Director of Pioneer AFM Corporation, will be elected as Managing Director.
- Mr. Koichi Ueda, professor at Meiji Law School and attorney-at-law,
will be elected as Outside Director.
(3)Directors who will retire:
- Mr. Osamu Yamada, Senior Managing Director, and General Manager of
Research & Development Group and General Manager of Corporate Research &
Development Laboratories*1; and
- Mr. Tatsuhiro Ishikawa, Outside Director.
(4)Candidates for Corporate Auditors to be newly elected:
- Mr. Michiyoshi Ogawa, currently Managing Director of Tohoku Pioneer
Corporation*2, will be elected as Corporate Auditor (full time); and
- Mr. Shinichi Yamada, certified public accountant, will be elected as
Outside Corporate Auditor.
(5)Corporate Auditors who will retire:
- Mr. Makoto Koshiba, Corporate Auditor (full time); and
- Mr. Isao Moriya, Outside Corporate Auditor.
(6)Mr. Takashi Miyazawa, General Manager of Legal Affairs Division, will be
newly elected as Substitute Auditor in case of a vacancy.
*1:Mr. Osamu Yamada will retire from his post as General Manager of Research &
Development Group and General Manager of Corporate Research & Development
Laboratories effective May 16, 2007.
*2:Mr. Michiyoshi Ogawa will retire from the office of Managing Director of
Tohoku Pioneer Corporation effective June 26, 2007.
This information is provided by RNS
The company news service from the London Stock Exchange
END
FR OKQKPKBKDDPD
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