Annual Report 2017
Financial Section
Consolidated Balance Sheets
2Consolidated Statements of Income
4
Consolidated Statements of Comprehensive Income
5
Consolidated Statements of Changes in Net Assets
6
Consolidated Statements of Cash Flows
7
Notes to the Consolidated Financial Statements
8
Consolidated Balance Sheets
DAISHINKU CORP. and Consolidated Subsidiaries
(Millions of yen)
(Thousands of U.S. dollars)
(note 6)
March 31, March 31,
2017 2016 2017
ASSETS
Current assets:
Cash and cash equivalents (Notes 2 (c), 7 and 21) ¥17,304 ¥20,410 $154,238 Trade notes and accounts receivable (Note 21) 7,381 6,888 65,790
Short term investment (Note 9) 260 52 2,316
Inventories (Note 8 and 11) 9,434 8,447 84,089
Deferred income taxes (Note 5 and 16) 307 65 2,734
Other current assets 2,301 1,040 20,515
Allowance for doubtful accounts (12) (10) (108)
Total current assets 36,975 36,892 329,574
Investments and other assets:
Investment securities (Notes 9 and 21) 1,717 1,688 15,303 Deferred income taxes (Note 5 and 16) 217 178 1,936
Other assets 1,386 1,392 12,359
Total investments and other assets 3,320 3,258 29,598
Property, plant and equipment, at cost：(Notes 12)
Land 5,705 5,675 50,849
Buildings and structures 19,348 20,297 172,458
Machinery and equipment 50,043 49,884 446,053
Lease assets 825 830 7,356
Construction in progress 1,219 491 10,865
Total property, plant and equipment 77,140 77,177 687,581 Less: accumulated depreciation (Notes 3) (56,739) (56,900) (505,740) Property, plant and equipment, net(Notes 12 and 23) 20,401 20,277 181,841
Total assets ¥60,696 ¥60,427 $541,013
Consolidated Balance Sheets
DAISHINKU CORP. and Consolidated Subsidiaries
The accompanying notes are an integral part of these financial statements.
(Millions of yen)
(Thousands of U.S. dollars)
(note 6)
March 31, March 31,
2017 2016 2017
LIABILITIES AND NET ASSETS
Current liabilities:
Short-term borrowings (Notes 12 and 21) ¥1,525 ¥1,788 $13,596
Current portion of long-term debt (Notes 12 and 21) 5,089 5,094 45,363
Current portion of long-term lease obligations 68 70 610
Trade notes and accounts payable (Note 21) 3,225 2,645 28,742
Accounts payable (Note 21) 1,536 2,708 13,687
Accrued income taxes (Note 16) 528 192 4,711
Accrued employees' bonuses 461 471 4,111
Reserve for director's and corporate auditor's bonuses
(Note 2(k)) 15 - 134
Other current liabilities 780 712 6,948
Total current liabilities 13,227 13,680 117,902
Long-term liabilities:
Long-term debt (Notes 12 and 21) 12,851 12,444 114,551
Long-term lease obligations 641 713 5,710
Net defined benefit liability(Note 13) 1,692 2,115 15,080
Deferred income taxes (Note 16) 866 740 7,715
Long-term accounts payable (Note 21) 173 222 1,538
Asset retirement obligations 25 25 225
Other long-term liabilities 107 122 955
Total long-term liabilities 16,355 16,381 145,774
Total liabilities 29,582 30,061 263,676
Commitments and contingent liabilities (Note 19)
Net Assets:
Shareholders’ equity
Common stock:(Note 18)
Authorized: 26,000,000 shares
Issued: 9,049,242 shares at March 31, 2017 and
45,246,212 shares at March 31, 2016 19,345 19,345 172,430
Additional paid-in capital 7,158 7,158 63,808
Retained earnings (Note 18 and 24) 556 (19) 4,950
Less: treasury stock, at cost: 973,573 shares at March 31, 2017 and 4,854,810 shares at March 31, 2016,
respectively (1,918) (1,914) (17,091)
Total shareholders’ equity 25,141 24,570 224,097
Accumulated other comprehensive income
Net unrealized holding gains (losses) on available-for-
sale securities (Note 9) 424 288 3,779
Foreign currency translation adjustments 840 1,054 7,492
Remeasurements of defined benefit plans (22) (178) (200)
Total accumulated other comprehensive income 1,242 1,164 11,071
Non-controlling interests 4,731 4,632 42,169
Total net assets 31,114 30,366 277,337
Consolidated Statements of Income
DAISHINKU CORP. and Consolidated Subsidiaries
(Millions of yen)
(Thousands of U.S. dollars)
(note 6)
For the years ended March 31,
For the year ended March 31,
2017 2016 2017
Net sales (Note 23) ¥30,959 ¥32,182 $275,955
Cost of sales 23,450 25,287 209,024
Gross profit 7,509 6,895 66,931
Selling, general and administrative
Expenses (Note 14) 6,114 6,202 54,493
Operating income (Note 23) 1,395 693 12,438
Other income (expenses):
Interest and dividend income 83 80 743
Interest expenses (133) (165) (1,182)
Foreign currency exchange loss, net (256) (536) (2,280) Gain on contribution of securities to retirement
benefit trust 125 - 1,109
Gain (loss) on sales or disposal of property, plant
and equipment, net 41 (29) 365
Impairment loss (Note 10) (293) (13) (2,613)
Loss on abandonment of inventories (Note 11) (219) - (1,950)
Subsidy income 314 401 2,795
Other, net 136 225 1,212
Income before income taxes 1,193 656 10,637
Income taxes (Note 16):
Current 542 314 4,833
Deferred (217) 0 (1,937)
325 314 2,896
Income 868 342 7,741
Income attributable to non-controlling interests 172 202 1,540
Income attributable to owners of parent ¥696 ¥140 $6,201
Consolidated Statements of Comprehensive Income
DAISHINKU CORP. and Consolidated Subsidiaries
(Millions of yen)
(Thousands of U.S. dollars)
(note 6)
For the years ended March 31,
For the year ended March 31,
2017 2016 2017
Income ¥868 ¥342 $7,741
Other comprehensive income (Note 17)
Unrealized holding loss on available-for-sale securities 136 (239) 1,207
Foreign currency transaction adjustments (168) (1,373) (1,495)
Remeasurements of defined benefit plans 153 (540) 1,359
Total other comprehensive income, net 121 (2,152) 1,071
Comprehensive income ¥989 ¥(1,810) $8,812
Comprehensive income attributable to:
Consolidated Statements of Changes in Net Assets
DAISHINKU CORP. and Consolidated Subsidiaries
(Millions of yen)
Common stock Additional paid-in capital Retained earnings Treasury stock Net unrealized holding gains (losses) on available-for-sale securities Foreign currency translation adjustment Remeasurements of defined benefit
plans Non- controlling interests Total Net assets
Balance at April 1, 2015 ¥ 19,345 ¥ 12,413 ¥ (5,310) ¥ (1,910) ¥ 527 ¥ 1,891 ¥ 351 ¥ 5,149 ¥ 32,456
Deficit disposition - (5,255) 5,255 - - -
-Net income attributable to
owners of parent - - 140 -
-- - 140
Changes in retained earnings based on generally accepted international accounting standards used for foreign subsidiaries
- - (104) - - - - - (104)
Acquisition of treasury
stock - - - (4)
-- - (4)
Disposal of treasury stock - 0 - 0 - - - - 0
Other changes - - - - (239) (837) (529) (517) (2,122)
Balance at April 1, 2016 19,345 7,158 (19) (1,914) 288 1,054 (178) 4,632 30,366
Dividends - - (121) - - - (121)
Net income attributable to
owners of parent - - 696 -
-- - 696
Acquisition of treasury
stock - - - (4)
-- - (4)
Disposal of treasury stock - 0 - 0 - - - - 0
Other changes - - - - 136 (214) 156 99 177
Balance at March 31, 2017 ¥ 19,345 ¥ 7,158 ¥ 556 ¥ (1,918) ¥ 424 ¥ 840 ¥ (22) ¥ 4,731 ¥ 31,114
(Thousands of U.S. dollars) (note 6) Common stock Additional paid-in capital Retained earnings Treasury stock Net unrealized holding gains (losses) on available-for-sale securities Foreign currency translation adjustment Remeasurements of defined benefit
plans Non- controlling interests Total Net assets
Balance at April 1, 2016 $ 172,430 $ 63,809 $ (171) $ (17,062) $ 2,572 $ 9,394 $ (1,587) $ 41,282 $ 270,667
Dividends - - (1,080) - - - - - (1,080)
Net income attributable to
owners of parent - - 6,201 - - - - - 6,201
Acquisition of treasury
stock - - - (31) - - - - (31)
Disposal of treasury stock - (1) - 2 - - - - 1
Other changes - - - - 1,207 (1,902) 1,387 887 1,579
Consolidated Statements of Cash Flows
DAISHINKU CORP. and Consolidated Subsidiaries
(Millions of yen)
(Thousands of U.S. dollars)
(note 6)
For the years ended March 31,
For the year ended March 31
2017 2016 2017
OPERATING ACTIVITIES:
Income before income taxes ¥1,193 ¥656 $10,637
Adjustments for:
Depreciation and amortization 2,584 2,459 23,035
Impairment loss on fixed assets 293 13 2,613
Amortization of long-term prepaid expenses 73 35 647
Allowance for doubtful accounts, net 3 (2) 25
Increase (decrease) in provision for bonuses (9) (5) (82)
Increase (decrease) in provision for director's and corporate auditor's bonuses 15 - 134
Net defined benefit liability 4 (56) 37
Loss (Gain) on sales or disposal of property, plant and equipment, net (41) 29 (366)
Interest and dividend income (83) (80) (743)
Interest expenses 133 165 1,182
Foreign currency exchange gains (losses) , net (145) 460 (1,296)
Gain on contribution of securities to retirement benefit trust (124) - (1,109)
Loss on abandonment of inventories 219 - 1,950
Changes in assets and liabilities：
Increase (decrease) in trade notes and accounts receivable (482) (250) (4,294)
Increase (decrease) in inventories (1,220) 911 (10,870)
Increase (decrease) in trade notes and accounts payable 639 523 5,700
Other-net (148) 337 (1,315)
Sub-total 2,904 5,195 25,885
Interest and dividends-received 83 80 743
Interest-paid (131) (168) (1,167)
Income taxes-paid (271) (259) (2,421)
Net cash provided by operating activities 2,585 4,848 23,040
INVESTING ACTIVITIES:
Decrease (increase) in time deposits, net 4 - 31
Decrease (increase) in short-term investment securities, net (189) (56) (1,687)
Payments for purchase of property, plant and equipment (4,763) (1,705) (42,453)
Proceeds from sales of property, plant and equipment 108 96 962
Purchase of long-term prepaid expenses - (822)
-Payments for sales of shares of subsidiaries resulting in change
in scope of consolidation (141) - (1,256)
Other-net (90) 68 (796)
Net cash used in investing activities (5,071) (2,419) (45,199)
FINANCING ACTIVITIES:
Increase (decrease) in short-term borrowings (274) (2,146) (2,440)
Proceeds from long -term debt 5,664 10,009 50,486
Repayments of long-term debt (5,393) (5,034) (48,069)
Proceeds from sales and leasebacks - 829
Repayments of finance lease (74) (52) (660)
Cash dividends-paid (121) 0 (1,075)
Cash dividends paid to non-controlling shareholders (118) (168) (1,052)
Other- net (3) (4) (29)
Net cash provided by financing activities (319) 3,434 (2,839)
Effect of exchange rate changes on cash and cash equivalents (301) (601) (2,688)
Net increase (decrease) in cash and cash equivalents (3,106) 5,262 (27,686)
Cash and cash equivalents at beginning of year 20,410 15,148 181,924
1. BASIS OF PRESENTING CONSOLIDATED FINANCIAL STATEMENTS
The accompanying consolidated financial statements have been prepared based on the accounts maintained by Daishinku Corp. (the
“Company”) and its consolidated subsidiaries. The Company and its domestic subsidiaries have maintained their accounts and records in
accordance with the provisions set forth in the Financial Instruments and Exchange Act, and in conformity with accounting principles generally
accepted in Japan, which are different in certain respects as to application and disclosure requirements of International Financial Reporting
Standards and are compiled from the consolidated financial statements prepared by the Company as required by the Financial Instruments and
Exchange Act. Overseas consolidated subsidiaries maintain their records in conformity with accounting principles and practices generally accepted
in their respective countries. In general, no adjustments to the accounts of overseas consolidated subsidiaries have been reflected in the
accompanying consolidated financial statements to present them in conformity with Japanese accounting principles and practices followed by the
Company as allowed under accounting principles generally accepted in Japan.
Certain items presented in the consolidated financial statements filed with the Director of the Kanto Finance Bureau have been reclassified for
the convenience of readers outside Japan.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (a) PRINCIPLES OF CONSOLIDATION
The consolidated financial statements include the accounts of the Company and its significant subsidiaries. Investments in certain subsidiaries
which are not consolidated and in affiliates are, due to immaterial, accounted for at cost.
(Changes in the scope of consolidation)
HARMONY ELECTRONICS (Suzhou) Co., Ltd. was excluded from the consolidation scope due to sale of all shares during the year ended
March 31, 2017.
Generally, shareholdings in companies of more than 50% fall into the category of subsidiaries and shareholdings in companies of between 20%
and 50% fall into the category of affiliates. However, shareholdings of between 40% and 50% may also fall into the category of subsidiaries, if the
Company either substantially controls the investee company or has significant influence and relationship with the investees, respectively.
All significant intercompany accounts and transactions and unrealized inter-company profits are eliminated upon consolidation. The excess of
the investment cost over the fair value of underlying net equity in subsidiaries and affiliates which are consolidated or accounted for by the equity
method at the date of an acquisition is amortized on a straight-line basis within mainly five years or less.
TIANJIN KDS CORP., HARMONY ELECTRONICS CORP., HARMONY ELECTRONICS (Shen Zhen) Co., Ltd., HARMONY
ELECTRONICS (Thailand) Co., Ltd., SHANGHAI DAISHINKU INTERNATIONAL TRADING Co., Ltd. and DAISHINKU (THAILAND)
Co., Ltd. use a fiscal year ending December 31. DAISHINKU H.K Ltd., DAISHINKU AMERICA CORP., DAISHINKU (SINGAPORE) PTE.
Ltd., DAISHINKU DEUTSCHLAND GmbH., PT KDS INDONESIA and KYUSYU DAISHINKU CORP use a fiscal year ending March 31.
TIANJIN KDS CORP., HARMONY ELECTRONICS CORP., HARMONY ELECTRONICS (Shen Zhen) Co., Ltd. HARMONY
ELECTRONICS (Thailand) Co., Ltd., SHANGHAI DAISHINKU INTERNATIONAL TRADING Co., Ltd. and DAISHINKU (THAILAND)
Co., Ltd. have performed a hard close as of March 31, 2017.
(b) TRANSLATION OF FOREIGN CURRENCIES
All monetary assets and liabilities denominated in foreign currencies are translated into Japanese yen at the exchange rates prevailing at the
balance sheet date. Resulting gains and losses are included in net profit or loss for the period when incurred.
Assets and liabilities of the overseas consolidated subsidiaries are translated into Japanese yen at the exchange rates prevailing at the balance
sheet date. The shareholders' equity at the beginning of the year is translated into Japanese yen at the historical rates. Differences in yen amounts
arising from the use of different rates are presented as "Foreign currency translation adjustments" in the net assets and included in non-controlling
interests in the net assets.
(c) CASH AND CASH EQUIVALENTS
on demand and highly liquid investments purchased with initial maturities of three months or less and which present a low risk of fluctuation in
value.
(d) INVENTORIES
Inventories are mainly stated at cost determined by the average method. (The write-downs of inventories due to decreased profitability shall be
recognized as cost of sales, in the case that the net selling value falls below the acquisition cost at the end of period, in the same manner as if these
inventories were stated at the lower of cost or market.)
(e) SHORT-TERM INVESTMENTS AND INVESTMENT SECURITIES
All securities held by the Company and its consolidated subsidiaries are classified into Available-for-sale securities.
Available-for-sale securities with readily determinable fair values are stated at fair value. Net unrealized gains or losses on these securities are
reported as a separate item in the valuation and translation adjustments in the net assets at a net-of-tax amount.
Available-for-sale securities without readily determinable fair values are stated at cost, except as stated in the paragraph below.
When the market price of available-for-sale securities falls below 50% of the price of the securities at the time of acquisition, a realized loss is
recognized with the new cost basis being the current market price. If the market price falls 30% or more but less than 50%, a judgment is made
about the likelihood of a recovery in price and decision is taken whether to write down to fair value.
(f) PROPERTY, PLANT AND EQUIPMENT AND DEPRECIATION (EXCEPT FOR LEASED ASSETS UNDER FINANCE LEASES) Property, plant and equipment are stated at cost. Depreciation is principally computed by the declining-balance method (excluding buildings
acquired on or after April 1, 1998 and structures and facilities attached to buildings acquired on or after April 1, 2016, for which the straight-line
method are applied), except that the foreign consolidated subsidiaries mainly compute depreciation by the straight-line method.
The principal estimated useful lives used for computing depreciation are as follows:
Building and structures 3 to 60 years
Machinery and equipment 2 to 17 years
The cost of maintenance, repairs and minor renewals is charged to income when incurred; major renewals and betterments are capitalized.
(g) FINANCE LEASES
Leases that transfer substantially all the risks and rewards of ownership of the assets are accounted for as capital leases. Leases that do not
transfer ownership of the assets at the end of the lease term are accounted for as operating leases, in accordance with accounting principles and
practices generally accepted in Japan.
For lease assets in finance lease transactions that do not transfer ownership, the straight-line method is employed, depreciating these assets
down to their remaining guaranteed amount over the lease period, which is used as the service life.
(h)GOODWILL
Goodwill is amortized by the straight-line method over periods of no more than 5 years. Negative goodwill recognized on or after April 1, 2010
is credited to income as incurred.
(i) ALLOWANCE FOR DOUBTFUL ACCOUNTS
The allowance for doubtful accounts is computed based on historical write-off experience from a certain reference period plus estimated
uncollectible amounts based on the analysis of individual accounts.
(j) ACCRUED EMPLOYEES’ BONUSES
Accrued employees’ bonuses are provided for the estimated amounts which the Company is obligated to pay to employees after the fiscal
(k) RESERVE FOR DIRECTOR’S AND CORPORATE AUDITOR’S BONUSES
Reserve for director's and corporate auditor's bonuses are provided for the estimated amounts which the Company is obligated to pay to director
and corporate auditor after the fiscal year-end, based on services provided during the current period.
(l) RETIREMENT BENEFITS AND PENSION PLAN
The provision for retirement benefits represents the estimated present value of projected benefit obligations in excess of the fair value of the plan
assets at the balance sheet date. Unrecognized prior service costs are amortized based on the straight-line method over a period of ten years
beginning at the date of adoption of the plan amendment. Unrecognized actuarial gains and losses are amortized based on the straight-line
method over a period of ten years starting from the beginning of the subsequent year.
(m) RESEARCH AND DEVELOPMENT EXPENSES
Research and development expenses are charged to income when incurred.
(n) INCOME TAXES
The provision for income taxes is computed based on income before income taxes and non-controlling interests in the consolidated statements of
income. The asset and liability approach is used to recognize deferred tax assets and liabilities for the expected future tax consequences of
temporary differences between the carrying amounts and the tax basis of assets and liabilities.
(o) DERIVATIVES AND HEDGING ACTIVITIES
Derivative instruments are recognized as either assets or liabilities at their respective fair values at the date of contract, and gains and losses
arising from changes in fair value are recognized in earnings in the corresponding fiscal period. If certain hedging criteria are met, such gains and
losses are deferred and accounted for as assets or liabilities.
For interest rate swaps, if certain hedging criteria are met, interest rate swaps are not recognized at their fair values as an alternative method
under Japanese accounting standards. The amounts received or paid for such interest rate swap arrangements are charged or credited to income as
incurred.
(p) DISTRBUTION OF RETAINED EARNINGS
Under the Corporation Law of Japan (the “Law”), the distribution of retained earnings with respect to a given financial period is made by
resolution of the shareholders at a general meeting held subsequent to the close of the financial period. The accounts for that period do not,
therefore, reflect such distributions. Refer to Note 24.
3. CHANGE IN ACCOUNTING POLICY
(Adoption of the Practical Solution on Accounting for Changes in Depreciation Method related to the 2016 Tax Law Changes)
Following the revision of the Corporation Tax Act, the Company applied the "Practical Solution on Accounting for Changes in Depreciation
Method related to the 2016 Tax Law Changes (PITF No.32 of June 17, 2016)," to the year ended March 31, 2017. Accordingly, the depreciation
method of structures and facilities attached to buildings acquired on and after April 1, 2016 was changed from declining-balance method to
straight-line method. The impact on the consolidated financial statements of the year ended March 31, 2017 is immaterial.
4. RECLASSIFICATIONS
Certain reclassifications have been made to the prior year’s consolidated financial statements in order to conform to the current year presentations.
5. SUPPLEMENTARY INFORMATION
(Adoption of the Implementation Guidance on Recoverability of Deferred Tax Assets)
The Company adopted the Implementation Guidance on Recoverability of Deferred Tax Assets (ASBJ Guidance No. 26 of March 28, 2016) from
6. U.S. DOLLAR AMOUNTS
The United States dollar amounts are included solely for convenience and represent translations of Japanese yen amounts, as a matter of
arithmetical computation only, at the rate of ¥112= US$1, the exchange rate prevailing on March 31, 2017. This translation should not be construed
as a representation that Japanese yen amounts have been, could have been or could be realized or converted into United States dollars at the above
or any other rate.
7. CASH AND CASH EQUIVALENTS
A reconciliation of cash and cash equivalents between the consolidated statements of cash flows for the years ended March 31, 2017 and 2016
and the consolidated balance sheets as of March 31, 2017 and 2016 has been omitted since there were no reconciliation items.
8. INVENTORIES
Inventories at March 31, 2017 and 2016 consisted of the following:
(Thousands of
(Millions of yen) U.S. dollars)
March 31, March 31,
2017 2016 2017
Finished goods ¥3,145 ¥2,717 $28,036
Work in process 3,074 3,103 27,401
Materials and supplies 3,215 2,627 28,652
¥9,434 ¥8,447 $84,089
9. SHORT-TERM INVESTMENTS AND INVESTMENT SECURITIES
Short-term investments and investment securities at March 31, 2017 and 2016 were as follows:
(Millions of yen)
(Thousands of U.S. dollars)
March 31, March 31,
2017 2016 2017
Short-term investments
Time deposits ¥- ¥- $-
Other 260 52 2,316
Total ¥260 ¥52 $2,316
Investment securities:
Marketable equity securities and investment trust ¥1,568 ¥1,545 $13,979
Investment in unconsolidated subsidiaries 30 30 268
Other 119 113 1,056
Total ¥1,717 ¥1,688 $15,303
Information regarding marketable securities at March 31, 2017 and 2016 were as follows:
(Millions of yen)
March 31,
2017
Cost
Gross unrealized gains
Gross unrealized
losses Fair value Equity securities ¥965 ¥609 ¥(6) ¥1,568
Others - - - -
(Millions of yen)
March 31,
2016
Cost
Gross unrealized gains
Gross unrealized
losses Fair value Equity securities ¥1,143 ¥427 ¥(25) ¥1,545
Others - - - -
Total ¥1,143 ¥427 ¥(25) ¥1,545
(Thousands of U.S. dollars)
March 31,
2017
Cost
Gross unrealized gains
Gross unrealized
losses Fair value
Equity securities $8,599 $5,429 $(49) $13,979
Others - - - -
Total $8,599 $5,429 $(49) $13,979
Unlisted equity securities of ¥148 million ($1,323 thousand) and ¥143 million as of March 31, 2017 and 2016, respectively, that do not have
market value and for which it is difficult to determine the fair value are not included in the above table.
10. LOSS ON IMPAIRMENT OF FIXED ASSETS
(Millions of yen)
(Thousands of U.S. dollars)
Location Use Classification 2017 2017
Kanzaki Plant
Kanzaki County, Hyogo Prefecture Idle assets Construction in progress ¥5 $48 Tottori Business Place
Tottori City, Tottori Prefecture Idle assets Machinery and equipment 121 1,079
Tokushima Business Place
Yoshinogawa City, Tokushima Prefecture Idle assets Machinery and equipment etc. 86 761
HARMONY ELECTRONICS CORP.
Kaohsiung City, Taiwan Idle assets Machinery and equipment 17 152
HARMONY ELECTRONICS (Suzhou) Co., Ltd.
Suzhou, P.R. China
Potential
disposal assets Buildings and structures
64 573
Total ¥293 $2,613
The company and its consolidated subsidiaries categorize business assets by business segmentation and lease property, idle assets, and assets to be
disposed are categorized by separately.
The book values of idle assets, which are not expected to be utilized in the future, are written down to the recoverable amount and such
written-downs were recorded as impairment loss. The recoverable amount was measured as net selling prices, calculated using the market price in
Tokushima Business Place, and as zero in others.
The book values of assets to be disposed are written down to the recoverable amounts and such write-downs were recorded as impairment loss.
The recoverable amount was measured as net selling prices, calculated using appraisal report by a third-party real-estate appraiser in HARMONY
ELECTRONICS (Suzhou) Co., Ltd. .
(Millions of yen)
Location Use Classification 2016
TIANJIN KDS CORP.
Tianjin, P.R. China Idle assets Machinery and equipment etc. ¥13
The company and its consolidated subsidiaries categorize business assets by business segmentation and lease property, idle assets, and assets to be
disposed are categorized by separately. The book values of idle assets, which are not expected to be utilized in the future, are written down to the
recoverable amount and such written-downs were recorded as impairment loss. The recoverable amount was measured as net selling prices.
11. LOSS ON ABANDONMENT OF INVENTORIES
The Company group had put business structural change at the year ended March 31 2015. Based of which, the Company have finished partial
withdrawal of optical business (Single lens reflex product business) at the year ended March 31 2017. As a result, the Company recognized the loss
on abandonment of inventories.
12. SHORT-TERM BORROWINGS AND LONG-TERM DEBT
Short-term borrowings consisted principally of bank loans with a weighted average interest rate of 0.9% and 0.7% at March 31, 2017 and 2016,
respectively.
Long-term debt at March 31, 2017 and 2016 consisted of the following:
(Millions of yen)
(Thousands of U.S. dollars)
March 31, March 31,
2017 2016 2017
Loans principally from banks, due from 2017 to 2022, with weighted average interest of 0.6% and 0.6% at March 31, 2017 and 2016,
respectively. ¥17,940 ¥17,538 $159,914
Less; current portion (5,089) (5,094) (45,363)
¥12,851 ¥12,444 $114,551
The aggregate annual maturities of long-term debt at March 31, 2017 were as follows:
(Thousands of
(Millions of yen) U.S. dollars)
Year ending March 31,
2018 ¥5,089 $45,363
2019 3,562 31,753
2020 4,577 40,793
2021 3,502 31,220
2022 and thereafter 1,210 10,785
¥17,940 $159,914
Repayment schedule 5 years subsequent to March 31, 2017 for long-term debt and other debt is as above:
The following assets were pledged as collateral for bonds and loans principally from banks at March 31, 2017 and 2016:
Long-term debt with pledged assets at March 31, 2017and 2016 were as follows:
(Millions of yen)
(Thousands of U.S. dollars)
March 31, March 31,
2017 2016 2017
Current portion of long –term debt ¥77 ¥104 $684
Long-term debt 115 181 1,026
¥192 ¥285 $1,710
(Millions of yen)
(Thousands of U.S. dollars)
March 31, March 31,
2017 2016 2017
Land ¥467 ¥442 $4,163
Buildings and structures 322 318 2,872
13. RETIREMENT BENEFITS TO EMPLOYEES
The Company and consolidated subsidiaries have defined benefit pension plans. The plans comprise funded pension plans and unfunded pension
plans. Additionally the Company has defined contribution plans. The Company has instituted retirement benefit trusts since September 2016.
Under defined benefit pension plans, the reconciliation of opening and ending balances for project benefit obligation for the year ended March 31,
2017and 2016were as follows;
(Thousands of U.S.dollars)
(Millions of yen)
March 31, March 31,
2017 2016 2017
Project benefit obligation at beginning of year ¥5,116 ¥4,615 $45,600
Service cost 216 192 1,928
Interest cost 66 105 587
Actuarial differences 63 573 560
Retirement benefits paid (300) (286) (2,674)
Other 11 (83) 94
Project benefit obligation at ending of year ¥5,172 ¥5,116 $46,095
Under defined benefit pension plans, the reconciliation of opening and ending balances for pension assets for the year ended March 31, 2017 and
2016 were as follows;
(Thousands of U.S.dollars)
(Millions of yen)
March 31, March 31,
2017 2016 2017
Plan assets at beginning of year ¥3,001 ¥3,121 $26,751
Expected return on plan assets 45 47 402
Actuarial differences 164 (108) 1,465
Contribution paid by the business proprietor 218 218 1,939
Contribution of securities to retirement benefit trust 280 - 2,496
Retirement benefits paid (234) (261) (2,090)
Other 6 (16) 52
Plan assets at ending of year ¥3,480 ¥3,001 $31,015
The following table sets forth the funded status of the plans and the amounts recognized in the consolidated balance sheet as of March 31, 2017 and
2016 for the Company’s and the consolidated subsidiaries’ defined benefit pension plan;
(Thousands of U.S.dollars)
(Millions of yen)
March 31, March 31,
2017 2016 2017
Funded retirement benefit obligations ¥4,368 ¥4,408 $38,933
Plan assets at fair value (3,480) (3,001) (31,015)
888 1,407 7,918
Unfunded retirement benefit obligations 804 708 7,162
Net defined benefit liability in the balance sheet ¥1,692 ¥2,115 $15,080
Net defined benefit liability 1,692 2,115 15,080
The components of retirement benefit expenses for the year ended March 31, 2017 and 2016 were as follows;
(Thousands of U.S.dollars)
(Millions of yen)
March 31, March 31,
2017 2016 2017
Service cost ¥216 ¥192 $1,928
Interest cost 66 104 587
Expected return on plan assets (45) (47) (403)
Amortization of actuarial differences 36 (50) 325
Amortization of prior service costs - 0
-Other 3 (3) 27
Retirement benefit expenses ¥276 ¥196 $2,464
Remeasurements of defined benefit plans, before income-tax effect, at March 31, 2017 and 2016 consisted of;
(Thousands of U.S.dollars)
(Millions of yen)
March 31, March 31,
2017 2016 2017
Prior service cost ¥- ¥0
$-Actuarial differences (138) 569 (1,232)
Total ¥(138) ¥569 $(1,232)
Amortization of remeasurements of defined benefit plans, before income-tax effect, at March 31, 2017 and 2016 consisted of;
(Thousands of
U.S.dollars)
(Millions of yen)
March 31, March 31,
2017 2016 2017
Unrecognized actuarial gain/loss ¥73 ¥211 $647
The major categories of plan assets as of March 31, 2017 and 2016 were as follows;
March 31,
2017 2016
Bonds 36 % 38 %
Stocks 42 35
General accounts controlled by insurance companies 17 20
Other 5 7
Total 100 % 100 %
The above includes contribution of securities to retirement benefit trust by 10%.
The expected return on plan assets has been estimated considering the anticipated allocation to each asset class and the expected long-term returns
on assets held in each category.
The assumptions used in accounting for the above retirement benefit plans for the year ended March 31, 2017 and 2016 were as follows;
March 31,
2017 2016
Discount rate 0.3 % 0.3 %
Expected rate of return on plan assets 1.5 1.5
Total contributions paid by the Company and its consolidated subsidiaries to the defined contribution pension plans amounted to ¥ 57 million
14. RESEARCH AND DEVELOPMENT EXPENSES
Research and development expenses are included in selling, general and administrative expenses for the years ended March 31, 2017 and 2016
amounted to ¥1,739 million ($15,501 thousand) and ¥1,818 million respectively.
15. LEASES
Finance leases other than those deemed to transfer the ownership of leased property to the lessee mainly consist of production equipment for
application product of crystal.
Future lease payments for non-cancelable operating leases as a lessee at March 31, 2017 and 2016 were as follows:
Future lease payments for non-cancelable operating leases as a lessor at March 31, 2017and 2016 were as follows:
16. INCOME TAXES
Income taxes applicable to the Company and its domestic subsidiaries include (1) corporation tax, (2) enterprise tax and (3) inhabitants tax
which, in the aggregate, result in an effective tax rate approximately equal to 30.8% and 33.0% for the years ended March 31, 2017 and 2016.
Reconciliation between the Japanese statutory income tax rate and the effective tax rate for the year ended March 31, 2017 and 2016 were as
follows.
(Millions of yen)
(Thousands of U.S. dollars)
March 31, March 31,
2017 2016 2017
Due within one year ¥49 ¥107 $435
Due after one year 29 71 259
Future lease payments ¥78 ¥178 $694
(Millions of yen)
(Thousands of U.S. dollars)
March 31, March 31,
2017 2016 2017
Due within one year ¥3 ¥3 $27
Due after one year 17 20 153
Future lease payments ¥20 ¥23 $180
2017 2016
Japanese statutory tax rate 30.8 % 33.0 %
Valuation allowances (19.8) (46.6)
Expenses not deductible for tax purposes 14.3 18.0
Per capital inhabitant tax 1.4 3.1
Deficit of consolidated subsidiaries - 40.6
Undistributed profit of foreign subsidiaries 2.7 (6.8) Income of foreign subsidiaries taxed at lower than statutory tax rates 1.1 6.3
Others (3.3) 0.3
The components of the deferred tax assets and deferred tax liabilities at March 31, 2017 and 2016 were as follows：
(Thousands of
(Millions of yen) U.S. dollars)
March 31, March 31,
2017 2016 2017
Deferred tax assets:
Write-down of property, plant and equipment ¥782 ¥785 $6,969
Net defined benefit liability 489 568 4,360
Write-down of inventories 224 146 1,999
Unrealized profit 170 27 1,518
Other 534 598 4,755
Gross deferred tax assets 2,199 2,124 19,601
Less: valuation allowance (1,557) (1,794) (13,879)
Total deferred tax assets ¥642 ¥330 $5,722
Deferred tax liabilities:
Temporary difference of investment in subsidiaries (390) (356) (3,480)
Depreciation of foreign subsidiaries (118) (127) (1,052)
Net unrealized holding gains(losses) on available-for- sale securities (180) (120) (1,601)
Other (297) (226) (2,644)
Gross deferred tax liabilities (985) (829) (8,777)
Net deferred tax assets (liabilities) ¥(343) ¥(499) $(3,055)
17. COMPREHENSIVE INCOME
Other comprehensive income for the year ended March 31, 2017 and 2016 consisted of the following:
(Millions of yen)
(Thousands of U.S. dollars)
March 31 March 31
2017 2016 2017
Net unrealized holding gain on securities
Gains (Losses) arising during the year ¥241 ¥(361) $2,148
Reclassification adjustments to profit or loss (46) (1) (408)
Amount before income tax effect 195 (362) 1,740
Income tax effect (60) 123 (533)
Total 135 (239) 1,207
Translation adjustments
Gains (Losses) arising during the year (168) (1,373) (1,495)
Remeasurements of defined benefit plans
Gains (Losses) arising during the year 102 (521) 907
Reclassification adjustments to profit or loss 36 (48) 325
Amount before income tax effect 138 (569) 1,232
Income tax effect 15 29 127
Total 153 (540) 1,359
Total other comprehensive income ¥120 ¥(2,152) $1,071
18. NET ASSETS
The Japanese Companies Act (“the Law”) became effective on May 1, 2006, replacing the Japanese Commercial Code (“the Code”).
Under the Japanese laws and regulations, the entire amount paid for new shares is required to be designated as common stock. However, a
company may, by a resolution of the Board of Directors, designate an amount not exceeding one-half of the price of the new shares as additional
paid-in capital.
Under the Law, in cases where dividend distribution of surplus is made, the smaller of an amount equal to 10% of the dividend or the excess, if
any, of 25% of common stock over the total of additional paid-in-capital and legal earnings reserve must be set aside as additional paid–in-capital
Under the Code, companies were required to set aside an amount equal to at least 10% of cash dividends and other cash appropriations as legal
earnings reserve until the total of legal earnings reserve and additional paid-in capital equaled 25% of common stock.
Under the Code, legal earnings reserve and additional paid-in capital could be used to eliminate or reduce a deficit by a resolution of the
shareholders’ meeting or could be capitalized by a resolution of the Board of Directors. Under the law, both of these appropriations generally
require a resolution of the shareholders’ meeting.
Additional paid-in capital and legal earnings reserve may not be distributed as dividends. Under the Code, however, additional paid-in capital and
legal earnings reserve may be transferred to retained earnings by the resolution of the shareholders meeting as long as the total amount of legal
earnings reserve and additional paid-in capital remained equal to or exceeded 25% of common stock. Under the law, all additional paid-in-capital
and all legal earnings reserve may be transferred to other capital surplus and remained earnings, respectively, which are potentially available for
dividends.
Movements in common stock and treasury stock for the year ended March 31, 2017 was as follows:
Thousands of shares April 1,
2016
Increase in the year
Decrease in the year
March 31, 2017
Shares outstanding
Common stock 45,246 - (36,197) 9,049
Total 45,246 - (36,197) 9,049
Treasury stock
Common stock 4,855 8 (3,889) 974
Total 4,855 8 (3,889) 974
Effective October 1, 2016, the Company consolidated its common stocks at the ratio of five shares to one share.
19. COMMITMENTS AND CONTINGENT LIABILITIES Contingent liabilities at March 31, 2017 and 2016 were as follows:
(Millions of yen) (Thousands of
U.S. dollars)
March 31, March 31,
2017 2016 2017
Trade notes endorsed ¥83 ¥102 $744
20. NET INCOME PER SHARE
Amounts per share at March 31, 2017 and 2016 and were as follows:
(Yen) (U.S. dollars)
March 31, March 31,
2017 2016 2017
Net assets ¥3,267.04 ¥3,185.66 $29.12
Net income (loss) 86.13 17.31 0.77
Cash dividends applicable to the year - 2.00
-Diluted net income per share for the years ended March 31, 2017 and 2016 has not been disclosed because no potential for dilution exited at
March 31, 2017 and 2016. Amounts per share of net assets are computed based on the number of shares of common stock outstanding at the year
end. Basic net income per share is computed based on the net income attributable to shareholders of common stock and the weighted-average
number of shares of common stock outstanding during the year. Cash dividends per share represent the cash dividends proposed by the Board of
Directors as applicable to the respective fiscal years.
Effective October 1, 2016, the Company consolidated its common shares at the ratio of five shares to one share. Accordingly, the net assets per
share and earnings per share have been calculated as if the said share consolidation was conducted at the beginning of the previous fiscal year.
Dividends prior to the share consolidation are ¥1 per share and dividends after the share consolidation are ¥ 25 per share. Based on this, the
21. FAIR VALUES OF FINANCIAL INSTRUMENTS
For financial instruments, amounts recorded on the consolidated balance sheet and fair values as of March 31, 2017 and 2016, and the differences between the two were as follows. It should be noted that financial instruments for which it is considered extremely difficult to assets fair values are
not included in the following table.
March 31, 2017
(Millions of yen) (Thousands of U.S. dollars)
Amounts on consolidated balance sheet
Fair Value Difference
Amounts on consolidated balance sheet
Fair Value Difference
(1)Cash and cash equivalent ¥17,304 ¥17,304 - $154,238 $154,238
-(2)Trade notes and accounts
receivable 7,381 7,381 - 65,790 65,790
-(3)Investment securities 1,828 1,828 - 16,295 16,295
-Assets total 26,513 26,513 - 236,323 236,323
-(1)Trade notes and accounts
payable 3,225 3,225 - 28,742 28,742
-(2)Short-term borrowings 1,525 1,525 - 13,596 13,596
-(3) Accounts payable 1,536 1,536 - 13,687 13,687
-(4)Long-term debt 17,940 17,968 28 159,914 160,161 247
Liabilities total 24,226 24,254 28 215,939 216,186 247
Derivative transactions(*) 2 2 - 16 16
-March 31, 2016
(Millions of yen)
Amounts on consolidated balance sheet
Fair Value Difference
(1)Cash and cash equivalent ¥20,410 ¥20,410 -(2)Trade notes and accounts
receivable 6,888 6,888
-(3)Investment securities 1,597 1,597
-Assets total 28,895 28,895
-(1)Trade notes and accounts
payable 2,645 2,645
-(2)Short-term borrowings 1,788 1,788
-(3) Accounts payable 2,708 2,708
-(4)Long-term debt 17,538 17,548 10
Liabilities total 24,679 24,689 10
Derivative transactions(*) 33 33
-*Derivative assets and (liabilities) are on a net basis.
Assets
(1) Cash and cash equivalents and (2) Trade notes and accounts receivable
All of these are settled within a short time, and their fair value and book value are nearly equal. Thus, the book value is listed as fair value in the
table above. Additionally, foreign exchange forward contracts are accounted for as part of accounts receivable. Therefore, the fair value of the
contracts are included in the fair value of underlying account receivable.
(3) Investment securities
The fair value of equity securities equals quoted market price, if available.
Liabilities
(1) Trade notes and accounts payable, (2) Short-term borrowings and (3) Accounts payable
The book value is used as the fair value for these items, as their fair values approximate their book values due to the short maturity of these
instruments.
(4) Long-term debt
The fair value of accounts payable and long-term borrowings are based on the present value of the total amount including principal and interest,
discounted by the expected interest rate to be applied if similar new loans with a similar remaining period were entered into. Variable interest rate
for long-term borrowings is hedged by interest rate swap contract and accounted for as debt with interest rate. The fair value of long-term
borrowings with variable interest is reasonably based on the present value of the total of principal, interest and net cash flow of interest rate swap
contract discounted by reasonably estimated interest rate to be applied if similar new loans with a similar remaining period were entered into.
22. DERIVATIVE TRANSACTIONS
1. Derivative transactions that do not adopt hedge accounting
(1) Currency-related derivatives
(Millions of yen ) March 31, 2017
Contract amounts
Fair value
Realized gain (losses) Off-market transactions Total Due after one year
Currency options:
Selling call US dollar ¥228 ¥- ¥(2) ¥(2)
Buying put US dollar 228 - 4 4
Currency swaps:
Receive Japanese yen / Pay US dollar 204 204 6 6
Forward foreign exchange contracts:
Selling US dollar 1,924 - (3) (3)
Selling Japanese yen 40 - (1) (1)
Buying US dollar 60 - (2) (2)
Total ¥2,684 ¥204 ¥2 ¥2
(Thousands of U.S. dollars ) March 31, 2017
Contract amounts
Fair value
Realized gain (losses)
Off-market transactions Total Due after one year
Currency options:
Selling call US dollar $2,032 $- $(14) $(14)
Buying put US dollar 2,032 - 37 37
Currency swaps:
Receive Japanese yen / Pay US dollar 1,817 1,817 51 51
Forward foreign exchange contracts:
Selling US dollar 17,150 - (31) (31)
Selling Japanese yen 357 - (6) (6)
Buying US dollar 531 - (20) (20)
(Millions of yen ) March 31, 2016
Contract amounts
Fair value
Realized gain (losses) Off-market transactions Total Due after one year
Forward foreign exchange contracts:
Selling US dollar ¥574 - ¥32 ¥32
Total ¥574 - ¥32 ¥32
Fair value is based on information provided by financial institutions at the end of the fiscal year.
2. Derivative transactions that adopt hedge accounting
(1) Currency-related derivatives
(Millions of yen) March 31, 2017
Hedge accounting method Type Main hedge item
Contract amounts
Fair values Total Due after
one year Allocation method for forward
foreign exchange contract
Selling US dollar Account
receivable ¥2,606 ¥- *1
Total ¥2,606 ¥-
(Thousands of U.S. dollars ) March 31, 2017
Hedge accounting method Type Main hedge item
Contract amounts
Fair values
Total Due after
one year Allocation method for forward
foreign exchange contract
Selling US dollar Account
receivable $23,230 $- *1
Total $23,230 $-
(Millions of yen) March 31, 2016
Hedge accounting method Type Main hedge item
Contract amounts
Fair values Total Due after
one year Allocation method for forward
foreign exchange contract
Selling US dollar Account
receivable There were not applicable Total
*1. Foreign exchange forward contracts are accounted for as part of accounts receivable. Therefore, the fair value of the contracts are included in
(2) Interest rate-related derivatives
(Millions of yen) March 31, 2017
Hedge accounting method Type Main hedge item
Contract amounts
Fair values Total Due after
one year Interest rate swaps Receive variable
/ Pay fixed
Long-term debt
¥120 ¥40 *1
Total ¥120 ¥40
(Thousands of U.S. dollars) March 31, 2017
Hedge accounting method Type Main hedge item
Contract amounts
Fair values
Total Due after
one year
Interest rate swaps Receive variable
/ Pay fixed
Long-term debt
$1,070 $357 *1
Total $1,070 $357
(Millions of yen) March 31, 2016
Hedge accounting method Type Main hedge item
Contract amounts
Fair values Total Due after
one year Interest rate swaps Receive variable
/ Pay fixed
Long-term debt
¥160 ¥40 *1
Total ¥160 ¥40
*1. Since these interest rate swaps that are subject to special treatment accounted for with long-term debt, which are hedged items, their fair value
is included in the fair value of said long-term debt.
23. SEGMENT INFORMATION (1) Overview of reportable segments
Segments used for financial reporting are the Company’s constituent units for which separate financial information is available and for which
the Board of Directors performs periodic studies for the purpose of determining the allocation of resources and evaluating performance.
The Company undertakes production and sales activities in the quartz crystal. Within Japan, these operations are mainly handled by the
Company. Overseas, operations are handled by DAISHINKU (AMERICA) CORP. in America, DAISHINKU (DEUTSULAND) GmbH in
Europe, DAISHINKU (HK) LTD. and TIANJIN KDS CORP. in China, HARMONY ELECTRONICS CORP. and its subsidiaries in Taiwan,
and DAISHINKU (SINGAPORE) PTE.LTD., DAISHINKU (THAILAND) Co., Ltd. and PT. KDS INDONESIA in Asia. These affiliates each
operate as autonomous business units, forming comprehensive strategies in each region and developing business activities for the products and
services they undertake.
Accordingly, the Company’s basic production and sales structure comprises the six regional reportable segments of Japan, North America,
Europe, China, Taiwan, and Asia.
(2) Calculation methods for net sales, profits/losses, assets, liabilities, and other items for each reportable segment
The accounting methods by reportable business segment herein are almost the same as the description of the “summary of significant accounting
policies (Note 2)”. Income by reportable business segment is stated on an operating income basis. Intersegment net sales and transfers are
(3) Information about sales, profit (loss), assets, liabilities and other items is as follows.
(Millions of yen)
Japan
North-
America Europe China Taiwan Asia Total Adjustment
Consolidated amount
Year ended March 31,2017 Sales:
Sales to outside customers ¥ 7,105 ¥ 1,653 ¥ 2,572 ¥ 10,227 ¥ 7,295 ¥ 2,107 ¥ 30,959 ¥ - ¥ 30,959
Inter-segment sales 19,189 54 3 2,040 2,921 5,574 29,781 (29,781)
-Total 26,294 1,707 2,575 12,267 10,216 7,681 60,740 (29,781) 30,959
Segment profit (loss) ¥ 1,107 ¥ 15 ¥ 76 ¥ (378) ¥ 672 ¥ 107 ¥ 1,599 ¥ (204) ¥ 1,395
Segment assets 39,017 789 886 7,262 15,117 6,501 69,572 (8,876) 60,696
Others:
Depreciation 1,158 2 2 98 699 462 2,421 (18) 2,403
Impairment loss 244 - - - 81 - 325 (32) 293
Increase in tangible
and Intangible fixed assets 1,687 0 1 117 761 1,178 3,744 (73) 3,671
( Thousands of U.S. dollars )
Japan
North-
America Europe China Taiwan Asia Total Adjustment
Consolidated
amount
Year ended March 31,2017
Sales:
Sales to outside customers $ 63,330 $ 14,735 $ 22,926 $ 91,160 $ 65,023 $ 18,781 $ 275,955 $ - $ 275,955
Inter-segment sales 171,039 481 31 18,181 26,038 49,685 265,455 (265,455) -
Total 234,369 15,216 22,957 109,341 91,061 68,466 541,410 (265,455) 275,955
Segment profit (loss) $ 9,867 $ 135 $ 678 $ (3,373) $ 5,995 $ 953 $ 14,255 $ (1,817) $ 12,438
Segment assets 347,778 7,028 7,893 64,733 134,746 57,947 620,125 (79,112) 541,013
Others:
Depreciation 10,325 19 15 869 6,227 4,121 21,576 (155) 21,421
Impairment loss 2,177 - - - 725 - 2,902 (289) 2,613
Increase in tangible
and Intangible fixed assets 15,041 3 8 1,041 6,789 10,496 33,378 (654) 32,724
(Millions of yen)
Japan North-
America Europe China Taiwan Asia Total Adjustment
Consolidated amount
Year ended March 31,2016
Sales:
Sales to outside customers ¥ 6,385 ¥ 2,076 ¥ 2,441 ¥ 10,417 ¥ 8,095 ¥ 2,768 ¥ 32,182 ¥ - ¥ 32,182
Inter-segment sales 19,526 46 2 3,640 2,531 5,648 31,393 (31,393) -
Total 25,911 2,122 2,443 14,057 10,626 8,416 63,575 (31,393) 32,182
Segment profit (loss) ¥ 731 ¥ 27 ¥ 50 ¥ (714) ¥ 528 ¥ 152 ¥ 774 ¥ (81) ¥ 693
Segment assets 38,492 815 762 7,894 14,120 5,732 67,815 (7,388) 60,427
Others:
Depreciation 650 4 3 172 871 523 2,223 (1)- 2,222
Impairment loss - - - 13 - - 13 - 13
Increase in tangible
Note: 1. (1) Adjustments on segment profit (loss) are eliminations of transactions in intersegment transactions, amortization of goodwill, and
other adjustments.
(2) Adjustments on segment assets are eliminations of receivables and payables in intersegment debtors and creditors, and other
adjustments.
(3) Adjustment on depreciation is eliminations of transactions in intersegment transactions.
2. Segment profit (loss) is reconciled to operating income on the consolidated statements of income.
3. Major countries and regions located in areas outside of Japan, China and Taiwan are as follows:
(1) North-America: The United States
(2) Europe: Germany
(3) Asia: Indonesia, Singapore, Thailand
Amortization of goodwill presented in the above table is included in selling, general and administrative expenses in the consolidated statement
of income for the year ended March 31, 2016.
(Related information)
(1) Information by products and services
Sales to external customers of individual products and services accounted for more than 90% of net sales reported on the Consolidated
Statements of Income. The Company, therefore, has not provided information by product and service.
(2) Information by region
a. Sales
Millions of Yen
Thousands of
U.S. dollars
Nets sales 2017 2016 2017
Japan ¥ 5,151 ¥ 4,556 $ 45,916
North-America 1,653 2,112 14,733
Europe 2,572 2,445 22,927
China 10,255 10,396 91,407
Taiwan 7,319 8,103 65,234
Asia 4,009 4,570 35,738
Total ¥ 30,959 ¥ 32,182 $ 275,955
Note: Net sales are classified by country and region based on customer location.
b. Tangible assets
Millions of Yen
Thousands of
U.S. dollars
2017 2016 2017
Japan ¥ 11,843 ¥ 11,723 $ 105,559
North-America 1 1 6
Europe 3 4 27
China 1,322 1,421 11,785
Taiwan 4,791 5,360 42,700
Indonesia 2,423 1,746 21,601
Asia 18 22 163
(Loss on impairment of fixed assets by each reportable segment)
Millions of Yen
Thousands of
U.S. dollars
2017 2016 2017
Japan ¥ 244 ¥ - $ 2,177
North-America - - -
Europe - - -
China - 13 -
Taiwan 81 - 725
Asia - - -
Adjustment (32) - (289)
Total ¥ 293 ¥ 13 $ 2,613
(Amortization and remaining balance of goodwill by each reportable segment)
(Millions of yen)
Japan North-
America Europe China Taiwan Asia Total Adjustment Consolidated
amount
Year ended March 31,2016
Amortization ¥ - - - ¥ 8 ¥ 8
Remaining balance - - - - ¥ - ¥ -
There were not applicable for the year ended March 31, 2017.
(Negative goodwill by each reportable segment)
As there is no negative goodwill, the disclosure of information on negative goodwill has been omitted.
24. SUBSEQUENT EVENTS
(Reversal of reserve for director’s and corporate auditor's bonuses)
The Company has decided not to pay director’s and corporate auditor’s bonuses at the board meeting on May 15, 2017. Accordingly, the Company
plans to record as non-operating income for reversal of reserve for director’s and corporate auditor’s bonuses at the year ending March 31, 2018.
(Cash Dividends)
The following distribution of retained earnings of the Company, which has not been reflected in the accompanying consolidated financial
statements for the year ended March 31, 2017, was approved at a meeting of the shareholders of the Company held on June 29, 2017:
(Millions of yen)
(Thousands of U.S dollars)
