TDK Corporation
1-13-1 Nihonbashi
Chuo-ku, Tokyo
103-8272 Japan
Contacts;
TDK Corporation (Tokyo) Corporate Communications
Department
Michinori Katayama +81(3)5201-7102
TDK U.S.A. Corporation Francis J. Sweeney +1(516)535-2600
UK Branch (TDK Marketing UK) Ron Matier +44(1737)773773
FOR IMMEDIATE RELEASE
TOKYO - April 28, 2004 TDK Corporation today announced its Consolidated
business results prepared in conformity with accounting principles generally
accepted in the United States of America ("U.S. GAAP") for fiscal year ("FY")
2004 and Non-Consolidated business results for FY 2004.
I. Consolidated
I-1) Summary
Consolidated results (April 1, 2003 - March 31, 2004)
FY2004 FY2003
(April 1, 2003 - March 31, (April 1, 2002 - Mar.
2004) 31, 2003) Change
Item/Term (Yen (U.S.$ (Yen
millions) % thousands) (Yen millions) % millions) %
Net sales 658,862 100.0 6,215,679 608,880 100.0 49,982 8.2
Operating income 54,322 8.2 512,472 22,080 3.6 32,242 146.0
Income before
income taxes 55,603 8.4 524,557 18,081 3.0 37,522 207.5
Net income 42,101 6.4 397,179 12,019 2.0 30,082 250.3
Per common share:
Net income / Basic Yen 317.80 U.S.$3.00 Yen 90.56
Net income /
Diluted Yen 317.69 U.S.$3.00 -
(Sales breakdown)
FY2004 FY2003
(April 1, 2003 - March 31, (April 1, 2002 - Mar.
2004) 31, 2003) Change
Product/Term (Yen (U.S.$ (Yen
millions) % thousands) (Yen millions) % millions) %
Electronic materials and
components 522,862 79.4 4,932,660 472,529 77.6 50,333 10.7
Electronic materials 166,818 25.3 1,573,755 168,949 27.8 (2,131) -1.3
Electronic devices 107,999 16.4 1,018,858 112,729 18.5 (4,730) -4.2
Recording devices 230,105 35.0 2,170,802 175,986 28.9 54,119 30.8
Semiconductors & others 17,940 2.7 169,245 14,865 2.4 3,075 20.7
Recording media &
systems 136,000 20.6 1,283,019 136,351 22.4 (351) -0.3
Total sales 658,862 100.0 6,215,679 608,880 100.0 49,982 8.2
Overseas sales 490,206 74.4 4,624,585 443,377 72.8 46,829 10.6
Note: U.S.$1=Yen 106
I-2) Management Policies
1. Fundamental Management Policy
TDK was established in 1935 as the world's first company to commercialize a
magnetic material called ferrite. In the ensuing years, TDK has developed and
commercialized electronic materials, electronic devices, recording devices and
recording media & systems. This drive has been based on the company's founding
spirit: "Contribute to culture and industry through creativity."
To preserve its identity as a dynamic company, TDK is dedicated to creating
value for all stakeholders, including shareholders, customers, suppliers,
society and employees, by drawing on innovative thinking and a willingness to
tackle new challenges. TDK firmly believes that it must remain an organization
that is a constant source of exciting ideas that are of true value to
stakeholders.
2. Fundamental Policy for Distribution of Earnings
Returning earnings to shareholders is one of TDK's highest management
priorities. As such, TDK's fundamental policy is to devote its efforts to a
stable increase of the dividend while taking into consideration a broad range
of factors, including the return on equity (ROE), dividends as a percentage of
equity (DOE) and the company's results of operation on a consolidated basis.
Retained earnings are used to invest in the development of new products and
technologies in key fields, to upgrade production facilities and in other ways
to make TDK more competitive and respond precisely to the rapid technological
advances in the electronics industry.
3. Medium- and Long-Term Management Strategy
In April 2004, TDK launched an initiative aimed at generating new growth with
the overriding aim of becoming an exciting company, an ongoing theme at TDK.
The electronics industry, TDK's main market, is witnessing escalating
competition due to progress in the digitalization and standardization of key
devices. To accurately respond to changing market needs as product life spans
shorten, TDK is dedicated to delivering new products that the market demands,
without delay, precisely when those products are needed. With this in mind, TDK
is aiming to increase the weighting of new products in its overall sales mix as
its growth strategy over the medium term.
TDK also plans to take steps to refine its sophisticated technological and
development capabilities in the core electronic materials and components
business. TDK is aiming for growth by delivering the value customers demand in
a timely manner through the development of products rooted in the company's
core materials, process and evaluation technologies, which underpin its
electronic materials and components business.
As a responsible corporate citizen, TDK believes that it is important to
incorporate public, ethical, environmental and other considerations in its
management processes and dealings with society. In particular, determined to
play its part in preserving the environment for future generations, TDK has
formulated a fundamental environmental plan, "TDK Environmental Action 2010,"
for contributing to the realization of a sustainable society.
4. Corporate Ethics
TDK has formulated a corporate code of ethics to guide the activities of all
members of TDK in their efforts to create an even better company. The corporate
code of ethics, which is based on TDK's corporate motto and principles,
specifies the rules that the company, management and employees must observe in
the conduct of business. This code demonstrates TDK's commitment to constantly
upholding corporate ethical standards and improving risk management. TDK takes
every possible opportunity to educate staff on the corporate code of ethics.
5. Strategy to Improve Corporate Governance
Companies must conduct their activities and manage their operations in a fair,
impartial and transparent manner, abiding by laws and regulations, and with the
recognition that their existence is supported by shareholders, customers,
suppliers, society and employees. TDK put in place internal controls with this
fundamental recognition in mind. It has also implemented a number of other
measures in the same vein, such as appointing an outside director and statutory
auditors, involving people outside the company in setting directors'
remuneration, and ensuring that corporate ethics are strictly observed.
5-1. Management structure and other corporate governance systems concerning
decision-making, strategy execution and supervision
One of TDK's 7 directors is an outside director, who also serves as the
chairperson of the Remuneration Committee, which was set up to ensure the
fairness of directors' remuneration. Another committee, the Corporate Ethics
Committee, was established to ensure that TDK upholds corporate ethical
standards. Independent of this committee, TDK has a "helpline" that encourages
employees to report matters relating to corporate ethics and offer suggestions.
Moreover, having introduced the post of corporate officer, TDK has clearly
demarcated responsibilities: directors are responsible for decision-making and
oversight, while corporate officers have responsibility for executing
day-to-day operations. Corporate officers execute policies set by the Board of
Directors in their respective areas of responsibility.
TDK applies the Corporate Auditor System in accordance with the Commercial Code
of Japan, and 3 of its 5 corporate auditors come from outside the company. The
role of the corporate auditor is not restricted to the supervision of
directors' activities. As required, they also audit business activities. In
addition, the Management Review & Support Department is primarily responsible
for auditing business activities.
Another defining aspect of TDK's corporate governance system is that it
receives advice and warnings from outside legal counsel and independent
auditors regarding risks associated with TDK's corporate activities.
5-2. Personal, financial and trading relationships between the company and the
outside director and outside corporate auditors, and other beneficial
relationships
There are no personal or financial relationships between TDK and the outside
director or the three outside corporate auditors.
5-3. Measures taken to enhance corporate governance over the past year
To ensure that corporate ethical standards are being upheld, TDK has put in
place a global corporate ethics framework that encompasses the activities of
overseas subsidiaries as well as domestic ones. And, to comply with the U.S.
Sarbanes-Oxley Act of 2002, a strict law relating to corporate governance that
was prompted by a series of scandals involving major corporations, TDK formed a
project team that includes outside experts to undertake a fundamental review
and reinforce corporate systems. Furthermore, in the same vein, TDK restricts
the work that is outsourced to independent auditors so as to preserve their
impartiality and independence. Moreover, at the ordinary general meeting of
shareholders held in June 2003, a resolution was approved that shortens the
terms of directors to one year. This change was made to give the company the
best management structure with which to respond flexibly to changes in its
operating environment and to build greater trust with shareholders.
6. Policy Regarding Reduction of TDK's Share Trading Unit
On August 1, 2000, TDK reduced the trading unit of its common shares from 1,000
to 100 shares to broaden the shareholder base and increase the liquidity of the
company's shares. TDK now considers that its shares have sufficient liquidity.
TDK will consider a further reduction of the trading unit based on its stock
price and market needs as well as on a cost-benefit analysis.
I-3) Business Results and Financial Position
1. Summary
Consolidated results for fiscal 2004, ended March 31, 2004, were as follows.
The Japanese economy in fiscal 2004 tended toward recovery, led by IT-related
production and exports. However, with no upturn evident in household incomes,
consumer spending failed to rebound. Meanwhile, the U.S. economy, the driving
force for the world economy, expanded compared with the previous year, with
consumer spending, housing investment and capital expenditures all rising, as
the government eased fiscal and monetary policy.
In the electronics industry, the year was characterized by the rising
popularity of LCD and plasma flat-screen TVs, digital cameras and DVD
recorders, as well as by the increasing sophistication of mobile phones and
replacement demand for PCs, and the growing use of electronics in automobiles.
However, deflationary trends in world markets affected these finished products,
placing unrelenting pricing pressure on electronic materials and components and
recording media and systems, TDK's main products.
TDK saw orders drop in the first quarter (April-June 2003) of fiscal 2004 due
to one-off factors such as the SARS outbreak and fallout from the Iraq war.
Nevertheless, TDK remained focused on implementing profit structure reforms,
carrying on initiatives from fiscal 2003 to improve asset productivity and
concentrate resources on strategic businesses.
As a result, TDK posted consolidated net sales of �658,862 million
(U.S.$6,215,679 thousand), up 8.2% from �608,880 million. Operating income
climbed 146.0%, from �22,080 million to �54,322 million (U.S.$512,472
thousand). Income before income taxes jumped 207.5%, from �18,081 million to �
55,603 million (U.S.$524,557 thousand). Net income soared 250.3%, from �12,019
million to �42,101 million (U.S.$397,179 thousand). Basic net income per common
share was �317.80 (U.S.$3.00), up from �90.56.
During the year, the average exchange rate was �113.19 for the U.S. dollar and
�132.65 for the euro, representing a 7.2% appreciation in the yen's value
against the U.S. dollar and a 9.7% depreciation against the euro. Overall,
exchange rate movements had the effect of lowering net sales by approximately �
4 billion and operating income by approximately �1.5 billion.
(Sales by Segment)
The following is a discussion of sales by business segment.
Electronic materials and components segment
In the electronic materials and components segment, net sales increased 10.7%,
from �472,529 million to �522,862 million (U.S.$4,932,660 thousand). Sales in
both the electronic materials and electronic devices sectors decreased compared
with the previous fiscal year when TDK benefited from a temporary surge in
demand related to the 2002 FIFA World Cup(tm) and strong demand from manufacturers
following a period of inventory reductions. This decline occurred despite solid
demand for components that was spurred by the growing popularity of flat-screen
TVs, digital cameras, DVD recorders and other electronic products, as well as
by recovering sales of mobile phones. Segment sales as a whole rose on the back
of a sharp year-on-year increase in sales of HDD heads accompanying burgeoning
demand for HDDs. Sector results were as follows.
Electronic materials
Sales in the electronic materials sector decreased 1.3%, from �168,949 million
to �166,818 million (U.S.$1,573,755 thousand).
(Capacitors) Sales of multilayer chip capacitors, the main product in the
capacitor sector, increased. Higher orders for capacitors, which reflected
growing demand for communications products, offset falling sales prices and the
negative effect of exchange rate movements.
(Ferrite cores and magnets) In ferrite cores, deflection yoke cores and flyback
transformer cores saw sales drop due to falling demand and sales prices. The
drop in orders is a reflection of a rapid shift in consumer demand from CRT TVs
to LCD, plasma and other flat-panel models. Higher sales of small coils and
transformer cores, a category where demand is increasing, failed to offset this
decrease, resulting in a decline in overall sales of ferrite cores. Magnet
sales declined as the effect of falling sales prices outweighed higher sales
volumes. Overall, sales of ferrite cores and magnets were down year on year.
Electronic devices
In the electronic devices sector, sales decreased 4.2%, from �112,729 million
to �107,999 million (U.S.$1,018,858 thousand).
(Inductive devices) Inductive devices, the largest product category in this
sector, posted higher sales as demand for communications products increased in
line with advances in the performance of mobile phones. However, sales growth
was held back by lower sales prices and foreign currency movements.
(High-frequency components) Sales of high-frequency components decreased
despite an upswing in shipment volumes that resulted from strong demand for
components used in mobile phones, the main market for these components, and
successful activities to win new orders. The decrease reflects the continuing
glut in the supply of high-frequency components in the market as a whole, which
prompted customers to demand price reductions that were greater than in other
electronic component categories.
(Other products) Overall, sales of other products decreased. Sensors and
actuators recorded higher sales due to growth in demand for communications
products and PCs and peripherals. However, sales of power systems declined due
to lackluster demand associated with the amusement field, a sector where demand
was strong in the previous fiscal year.
Recording devices
Recording devices sales climbed 30.8%, from �175,986 million to �230,105
million (U.S.$2,170,802 thousand). Sales of HDD heads, the main product in this
sector, were up sharply. This was primarily because of continuing expansion in
the HDD market and the resulting robust HDD sales by major TDK customers. Sales
of other heads also increased.
Semiconductors & others
Sales in the semiconductors & others sector climbed 20.7%, from �14,865 million
to �17,940 million (U.S.$169,245 thousand), despite sluggish sales of
semiconductors for communications applications. Growth reflected higher sales
of anechoic chambers for noise control and equipment used in these chambers.
Recording media & systems segment
In the recording media & systems segment, sales edged down 0.3%, from �136,351
million to �136,000 million (U.S.$1,283,019 thousand). While TDK continues to
command a high share of the audiotape and videotape markets, sales in these two
categories decreased as demand continues to shrink due to structural changes.
Optical media products posted increased sales, with higher sales volumes of
CD-Rs and DVDs in an expanding market offsetting lower sales prices. Sales of
other products decreased. Higher sales of LTO-standard* (Linear Tape-Open)
tape-based data storage media for computers failed to offset lower sales of PC
software, recording equipment and other products.
*Linear Tape-Open, LTO, LTO logo, Ultrium and Ultrium logo are trademarks of
HP, IBM and Certance LLC in the U.S., other countries or both.
(Sales by Region)
By region, sales in Japan increased 1.9%, from �165,503 million to �168,656
million (U.S.$1,591,094 thousand). While sales fell in the electronic materials
and electronic devices sectors and recording media & systems segment, sales
rose sharply in the recording devices sector. In the Americas, sales decreased
15.5%, from �106,060 million to �89,657 million (U.S.$845,821 thousand). Sales
fell in all sectors, with the exception of semiconductors & others, due to the
negative effect of the appreciation of the yen relative to the U.S. dollar. In
Europe, sales rose 4.1%, from �78,740 million to �81,950 million (U.S.$773,113
thousand), reflecting the yen's depreciation relative to the euro and strong
sales of CD-Rs and DVDs. In Asia (excluding Japan) and other areas, sales
climbed 23.2%, from �258,577 million to �318,599 million (U.S.$3,005,651
thousand), mainly due to higher sales of recording devices.
The overall result was a 10.6% rise in overseas sales year on year, from �
443,377 million to �490,206 million (U.S.$4,624,585 thousand). Overseas sales
accounted for 74.4% of consolidated net sales, a 1.6 percentage point increase
from 72.8% one year earlier.
On a parent-company basis, net sales decreased 1.4%, from �320,697 million to �
316,050 million (U.S.$2,981,603 thousand). Operating income decreased 44.8%,
from �3,182 million to �1,756 million (U.S.$16,566 thousand). Current income
rose 13.2%, from �9,078 million to �10,277 million (U.S.$96,952 thousand). Net
income was �4,458 million (U.S.$42,056 thousand), compared with �133 million in
fiscal 2003, while basic net income per share rose from �0.53 to �32.87
(U.S.$0.31).
TDK plans to pay a year-end dividend of �30 per common share. Together with the
interim dividend of �25 per common share paid in December 2003, the dividend
per common share applicable to the year will be �55.
On a parent-company basis, fiscal 2004 ROE was 1.1% and DOE was 1.7%.
2. Financial Position
(2-1) The following table summarizes TDK's balance sheet at March 31, 2004.
Total assets �770,319 million 3.1% increase
Total stockholders' equity �576,219 million 4.0% increase
Equity ratio 74.8% 0.7 percentage point increase
At the end of the year, cash and cash equivalents were �56,604 million higher
than on March 31, 2003. Net property, plant and equipment and other assets
decreased �16,962 million and �14,526 million, respectively. As a result of the
above items and other changes, total assets increased �22,982 million.
Total liabilities increased �732 million. Trade payables, accrued expenses and
income taxes payable increased �2,957 million, �5,963 million and �3,632
million, respectively, while retirement and severance benefits decreased �
11,450 million.
Total stockholders' equity increased �22,334 million. Retained earnings
increased �34,837 million, while accumulated other comprehensive loss increased
�11,563 million.
(2-2) Cash Flows
(� millions)
FY 2004 FY 2003 Change
Net cash provided by operating activities 114,704 104,358 10,346
Net cash used in investing activities (37,770) (46,645) 8,875
Net cash used in financing activities (9,661) (7,925) (1,736)
Effect of exchange rate changes on cash and cash
equivalents (10,669) (4,998) (5,671)
Net increase in cash and cash equivalents 56,604 44,790 11,814
Cash and cash equivalents at beginning of period 170,551 125,761 44,790
Cash and cash equivalents at end of period 227,155 170,551 56,604
Operating activities provided net cash of �114,704 million (U.S.$1,082,113
thousand), a year-on-year increase of �10,346 million. This reflected a �30,082
million increase in net income to �42,101 million (U.S.$397,179 thousand) and a
�6,556 million decrease to �51,233 million (U.S.$483,330 thousand) in
depreciation and amortization. In changes in assets and liabilities, there were
increases in trade receivables and inventories of �5,326 million and �22,101
million, respectively.
Investing activities used net cash of �37,770 million (U.S.$356,321 thousand),
�8,875 million less than a year earlier. While capital expenditures increased �
3,415 million to �44,866 million (U.S.$423,264 thousand), payment for purchase
of investments decreased �6,863 million.
Financing activities used net cash of �9,661 million (U.S.$91,141 thousand), �
1,736 million more than in the previous fiscal year. This primarily reflected
increases in repayments of short-term debt and dividends paid of �793 million
and �652 million, respectively.
(2-3) Trends in Cash Flow Indicators
FY FY FY FY FY
2000 2001 2002 2003 2004
Stockholders' equity ratio (%) 73.6 77.8 77.9 74.1 74.8
Capital adequacy ratio on a market value basis
(%) 239.9 133.8 121.7 80.4 136.7
No. of years to redeem debt 0.02 0.10 0.07 0.02 0.00
Interest coverage ratio (times) 165.3 138.0 32.8 180.9 355.1
[Notes]
Stockholders' equity ratio = Total stockholders' equity / Total assets
Capital adequacy ratio on a market value basis = Market capitalization (*1) /
Total assets
(*1) Market capitalization = Closing price of TDK's common shares on the Tokyo
Stock Exchange on March 31, 2004 x Shares issued and outstanding at year-end
after deducting treasury stock
No. of years to redeem debt = Interest-bearing liabilities (*2) / Cash flows
from operating activities (*3)
(*2) Interest-bearing liabilities: The balance of "short-term debt" and
long-term debt included in "long-term debt, excluding current installments" on
the consolidated balances sheets.
(*3) Cash flows from operating activities: "Net cash provided by operating
activities" on the consolidated statements of cash flows.
Interest coverage ratio = Cash flows from operating activities / Interest
payments (*4)
(*4) Interest payments: "Interest expense" on the consolidated statements of
income.
3. Fiscal 2005 Projections
TDK's consolidated and non-consolidated projections for fiscal 2005, the year
ending March 31, 2005, are as follows.
[Consolidated Projections for Fiscal 2005]
Year ending March % change Year ended March
2005 from FY04 2004
(� millions) (� millions)
Net sales 680,000 3.2 658,862
Operating income 60,000 10.5 54,322
Income before income taxes 62,000 11.5 55,603
Net income 46,500 10.4 42,101
[Non-Consolidated Projections for Fiscal 2005]
Year ending March % change Year ended March
2005 from FY04 2004
(� millions) (� millions)
Net sales 338,000 6.9 316,050
Operating income 9,700 452.4 1,756
Current income 20,500 99.5 10,277
Net income 13,500 202.8 4,458
The projections are based principally on the following assumptions:
* An average exchange rate of U.S.$1=�105 for fiscal 2005.
* Orders for passive components (electronic materials and electronic
devices) as a whole are expected to remain at a comparatively high level,
supported by firm demand in the first half of the year. However, this demand
may wane by the end of 2004.
* Orders for recording devices are expected to decline in the first half of
fiscal 2005, but second-half sales of these products should be supported by
growth in demand for HDDs used in PCs and consumer electronics.
* In the recording media & systems segment, lower sales of audiotapes and
videotapes are forecast. However, sales may rise year on year in the segment as
a whole, with higher sales of optical media products absorbing this decline.
Cautionary Statement About Projections
This earnings release contains forward-looking statements, including
projections, plans, policies, management strategies, targets, schedules,
understandings and evaluations, about TDK and its group companies that are not
historical facts. These forward-looking statements are based on current
forecasts, estimates, assumptions, plans, beliefs and evaluations in light of
information available to management on the date of this earnings release.
In preparing forecasts and estimates, TDK and its group companies have used as
their basis, certain assumptions as necessary, in addition to confirmed
historical facts. However, due to their nature, there is no guarantee that
these statements and assumptions will prove to be accurate in the future. TDK
therefore wishes to caution readers that these statements, facts and certain
assumptions contained in this earnings release are subject to a number of risks
and uncertainties and may prove to be inaccurate.
The electronics markets in which TDK and its group companies operate are highly
susceptible to rapid changes. Furthermore, TDK and its group companies operate
not only in Japan, but in many other countries. As such, factors that can have
significant effects on its results include, but are not limited to, shifts in
technology, demand, prices, competition, economic environments and foreign
exchange rates.
The premises and assumptions used in computing the projections in this earnings
release include, but are not limited to, those explained above.
Consolidated
I-4) Statements of income
FY2004 FY2003
(April 1, 2003 - March 31, (April 1, 2002 -
2004) Mar. 31, 2003) Change
Item/Term (Yen (U.S.$ (Yen
millions) % thousands) (Yen millions) % millions) %
Net sales 658,862 100.0 6,215,679 608,880 100.0 49,982 8.2
Cost of sales 474,106 72.0 4,472,698 459,616 75.5 14,490 3.2
Gross profit 184,756 28.0 1,742,981 149,264 24.5 35,492 23.8
Selling, general and
administrative expenses 130,434 19.8 1,230,509 127,184 20.9 3,250 2.6
Operating income 54,322 8.2 512,472 22,080 3.6 32,242 146.0
Other income (deductions):
Interest and dividend
income 1,189 11,217 1,379 (190)
Interest expense (323) (3,047) (577) 254
Foreign exchange gain
(loss) (3,065) (28,915) (1,482) (1,583)
Other-net 3,480 32,830 (3,319) 6,799
Total other income
(deductions) 1,281 0.2 12,085 (3,999) -0.6 5,280 -
Income before income taxes 55,603 8.4 524,557 18,081 3.0 37,522 207.5
Income taxes 13,143 2.0 123,991 5,296 0.9 7,847 148.2
Income before minority
interests 42,460 6.4 400,566 12,785 2.1 29,675 232.1
Minority interests (359) -0.0 (3,387) (766) -0.1 407 53.1
Net income 42,101 6.4 397,179 12,019 2.0 30,082 250.3
Note: U.S.$1=Yen 106
Consolidated
I-5) Balance sheets
ASSETS
As of Mar. 31,
As of March 31, 2004 2003 Change
Item/Term (Yen (U.S.$ (Yen (Yen
millions) % thousands) millions) % millions)
Current assets 475,773 61.8 4,488,424 420,962 56.3 54,811
Cash and cash equivalents 227,155 2,142,972 170,551 56,604
Marketable securities 402 3,792 - 402
Net trade receivables 138,331 1,305,009 140,023 (1,692)
Inventories 77,301 729,255 73,917 3,384
Other current assets 32,584 307,396 36,471 (3,887)
Noncurrent assets 294,546 38.2 2,778,736 326,375 43.7 (31,829)
Investments in securities 18,381 173,406 18,722 (341)
Net property, plant and
equipment 208,945 1,971,179 225,907 (16,962)
Other assets 67,220 634,151 81,746 (14,526)
TOTAL 770,319 100.0 7,267,160 747,337 100.0 22,982
LIABILITIES AND STOCKHOLDERS' EQUITY
As of Mar. 31,
As of March 31, 2004 2003 Change
(Yen (U.S.$ (Yen (Yen
Item/Term millions) % thousands) millions) % millions)
Current liabilities 115,218 15.0 1,086,962 105,014 14.0 10,204
Short-term debt 416 3,924 1,919 (1,503)
Trade payables 59,917 565,255 56,960 2,957
Accrued expenses 45,534 429,566 39,571 5,963
Income taxes payables 4,689 44,236 1,057 3,632
Other current liabilities 4,662 43,981 5,507 (845)
Noncurrent liabilities 75,606 9.8 713,264 85,078 11.4 (9,472)
Long-term debt, excluding
current installments 27 255 94 (67)
Retirement and severance
benefits 73,521 693,594 84,971 (11,450)
Deferred income taxes 215 2,028 13 202
Other noncurrent liabilities 1,843 17,387 - 1,843
Total liabilities 190,824 24.8 1,800,226 190,092 25.4 732
Minority interests 3,276 0.4 30,906 3,360 0.5 (84)
Common stock 32,641 307,934 32,641 -
Additional paid-in capital 63,051 594,821 63,051 -
Legal reserve 16,497 155,632 15,953 544
Retained earnings 560,756 5,290,151 525,919 34,837
Accumulated other comprehensive
income (loss) (90,387) (852,708) (78,824) (11,563)
Treasury stock (6,339) (59,802) (4,855) (1,484)
Total stockholders' equity 576,219 74.8 5,436,028 553,885 74.1 22,334
TOTAL 770,319 100.0 7,267,160 747,337 100.0 22,982
Note: U.S.$1=Yen 106
Consolidated
I-6) Statements of stockholders' equity
FY2004 FY2003
(April 1, 2003 - Mar. (April 1, 2002 -
31, 2004) Mar. 31, 2003)
(Yen (U.S.$
Item/Term millions) thousands) (Yen millions)
Common stock:
Balance at beginning of period 32,641 307,934 32,641
Balance at end of period 32,641 307,934 32,641
Additional paid-in capital:
Balance at beginning of period 63,051 594,821 63,051
Balance at end of period 63,051 594,821 63,051
Legal reserve:
Balance at beginning of period 15,953 150,500 15,683
Transferred from retained earnings 544 5,132 270
Balance at end of period 16,497 155,632 15,953
Retained earnings:
Balance at beginning of period 525,919 4,961,500 520,143
Net income 42,101 397,179 12,019
Cash dividends (6,625) (62,500) (5,973)
Losses on sales of treasury stock (95) (896) -
Transferred to legal reserve (544) (5,132) (270)
Balance at end of period 560,756 5,290,151 525,919
Accumulated other comprehensive
income (loss):
Balance at beginning of period (78,824) (743,623) (43,999)
Other comprehensive income (loss) for
the period, net of tax (11,563) (109,085) (34,825)
Balance at end of period (90,387) (852,708) (78,824)
Treasury stock:
Balance at beginning of period (4,855) (45,802) (3,592)
Acquisition of treasury stock (1,865) (17,594) (1,263)
Exercise of stock option 381 3,594 -
Balance at end of period (6,339) (59,802) (4,855)
Total stockholders' equity 576,219 5,436,028 553,885
Disclosure of comprehensive income
(loss):
Net income for the period 42,101 397,179 12,019
Other comprehensive income (loss) for
the period, net of tax (11,563) (109,085) (34,825)
Total comprehensive income (loss) for
the period 30,538 288,094 (22,806)
Note: U.S.$1=Yen 106
Consolidated
I-7) Statements of cash flows
FY2004 FY2003
(April 1, 2003 - (April 1, 2002 -
March 31, 2004) Mar. 31, 2003)
Item/Term (Yen (U.S.$
millions) thousands) (Yen millions)
Cash flows from operating activities:
Net income 42,101 397,179 12,019
Adjustments to reconcile net income to
net cash provided by operating
activities:
Depreciation and amortization 51,233 483,330 57,789
Loss on disposal of property and
equipment 1,789 16,877 4,845
Deferred income taxes 2,868 27,057 4,301
Loss on securities 1,093 10,311 3,298
Gain on sale of a subsidiary (567) (5,349) -
Changes in assets and liabilities:
Increase in trade receivables (7,582) (71,528) (2,256)
Decrease (increase) in inventories (7,824) (73,811) 14,277
Increase in trade payables 8,171 77,085 6,691
Increase (decrease) in accrued expenses 8,660 81,698 (5,971)
Increase (decrease) in income taxes
payables, net 5,877 55,443 2,265
Increase in retirement and severance
benefits 9,285 87,594 7,639
Other-net (400) (3,773) (539)
Net cash provided by operating activities 114,704 1,082,113 104,358
Cash flows from investing activities:
Capital expenditures (44,866) (423,264) (41,451)
Proceeds from sales and maturities of
investments 1,814 17,113 1,511
Payment for purchase of investments (443) (4,179) (7,306)
Proceeds from sales of property, plant
and equipment 4,571 43,123 4,590
Acquisition of minority interests (366) (3,453) (3,967)
Proceeds from sale of a subsidiary 1,523 14,368 -
Other-net (3) (29) (22)
Net cash used in investing activities (37,770) (356,321) (46,645)
Cash flows from financing activities:
Proceeds from long-term debt 69 651 211
Repayment of long-term debt (479) (4,519) (646)
Increase (decrease) in short-term debt,
net (1,047) (9,877) (254)
Sale (purchase) of treasury stock, net (1,579) (14,896) (1,263)
Dividends paid (6,625) (62,500) (5,973)
Net cash used in financing activities (9,661) (91,141) (7,925)
Effect of exchange rate changes on cash
and cash equivalents (10,669) (100,651) (4,998)
Net increase in cash and cash equivalents 56,604 534,000 44,790
Cash and cash equivalents at beginning of
period 170,551 1,608,972 125,761
Cash and cash equivalents at end of
period 227,155 2,142,972 170,551
Note: U.S.$1=Yen 106
Consolidated
I-8) Summary of Significant Accounting Policies
1. The consolidated financial statements are prepared in conformity with
U.S. GAAP.
(1) Marketable Securities
Statement of Financial Accounting Standards ("SFAS") No.115, "Accounting for
Certain Investments in Debt and Equity Securities" is adopted.
(2) Inventories
Inventories are stated at the lower of cost or market. Cost is determined
principally by the average method.
(3) Depreciation
Depreciation of property, plant and equipment is principally computed by the
declining-balance method for assets located in Japan and certain foreign
subsidiaries, and by the straight-line method for assets of other foreign
subsidiaries based on estimated useful lives.
(4) Income Taxes
Income taxes are accounted for under the asset and liability method. Deferred
tax assets and liabilities are recognized for the estimated future tax
consequences attributable to differences between the financial statement
carrying amounts of existing assets and liabilities and their respective tax
base and operating loss and tax credit carryforwards.
(5) Derivatives Financial Instruments
SFAS No.133, "Accounting for Derivative Instruments and Hedging Activities" and
SFAS No.138, "Accounting for Certain Derivative Instruments and Certain Hedging
Activities, an amendment of FASB Statement No.133" are adopted.
(6) Goodwill and Other Intangible Assets
SFAS No. 141, "Business Combinations" and SFAS No.142, "Goodwill and Other
Intangible Assets" are adopted.
2. During this consolidated accounting period, TDK had 72 subsidiaries (20
in Japan and 52 overseas). TDK also had 8 affiliates (5 in Japan and 3
overseas) whose financial statements are accounted for by the equity method.
3. Comprehensive income comprises net income and other comprehensive
income. Other comprehensive income includes changes in foreign currency
translation adjustments, minimum pension liability adjustments and net
unrealized gains (losses) on securities. The net income, other comprehensive
income (loss) and total comprehensive income (loss) for the fiscal year ended
Mar. 31, 2004 and 2003 were as follows;
FY2004 FY2003
(April 1, 2003 - March (April 1, 2002 - Mar.
31, 2004) 31, 2003)
Item/Term (Yen (U.S.$
millions) thousands) (Yen millions)
Net income 42,101 397,179 12,019
Other comprehensive income
(loss), net of tax:
Foreign currency translation
adjustments (26,287) (247,991) (18,747)
Minimum pension liability
adjustments 14,186 133,830 (15,809)
Net unrealized gains (losses) on
securities 538 5,076 (269)
Total comprehensive income
(loss) 30,538 288,094 (22,806)
Note: U.S.$1=Yen 106
Consolidated
4. Adoption of new accounting standards
(1) Accounting for Asset Retirement Obligation
In June 2001, the Financial Accounting Standards Board ("FASB") issued
Statement of Financial Accounting Standards No.143 ("SFAS 143"), "Accounting
for Asset Retirement Obligations", which addresses financial accounting and
reporting for obligations associated with the retirement of tangible long-lived
assets and associated asset retirement costs. SFAS 143 applies to legal
obligations associated with the retirement of long-lived assets that result
from the acquisition, construction, development and (or) the normal operation
of a long-lived asset, except for certain obligations of lessees. SFAS 143
requires that the fair value of a liability for an asset retirement obligation
be recognized in the period in which it is incurred if a reasonable estimate of
fair value can be made. The associated asset retirement costs are capitalized
as part of the carrying amount of the long-lived asset and subsequently
allocated to expense over the asset's useful life. TDK adopted SFAS 143 on
April 1, 2003. The adoption of SFAS 143 did not have a material effect on TDK's
consolidated financial statements.
(2) Accounting for Revenue Arrangements with Multiple Deliverables
In November 2002, the Emerging Issues Task Force reached a consensus on Issue
00-21 ("EITF 00-21"), "Accounting for Revenue Arrangements with Multiple
Deliverables". EITF 00-21 provides guidance on when and how to account for
arrangements that involve the delivery or performance of multiple products,
services and/or rights to use assets. TDK adopted EITF 00-21 on July 1, 2003.
The adoption of EITF 00-21 did not have a material effect on TDK's consolidated
financial position and results of operations.
(3) Consolidation of Variable Interest Entities
In December 2003, FASB issued FASB Interpretation No. 46 (revised December
2003) ("FIN 46R"), "Consolidation of Variable Interest Entities", which
addresses the consolidation by primary beneficiary of variable interest
entities ("VIEs") as defined in the Interpretation. FIN 46R replaces FASB
Interpretation No. 46, "Consolidation of Variable Interest Entities", which was
issued in January 2003. FIN 46R is effective immediately for all VIEs created
or acquired after January 31, 2003 and effective for other VIEs as of March 31,
2004. TDK has not created or acquired any VIEs after January 31, 2003. For VIEs
created or acquired before February 1, 2003, the adoption of FIN 46R for these
entities did not have a material effect on TDK's consolidated financial
statements.
Consolidated
I-9) Segment Information
The following industry and geographic segment information are required by the
Japanese Securities Exchange Law.
FY2004 FY2003
(April 1, 2003 - March 31, (April 1, 2002 - Mar.
2004) 31, 2003) Change
Product/Term (Yen (U.S.$ (Yen
millions) % thousands) (Yen millions) % millions) %
Electronic materials
and components
Net sales 522,862 100.0 4,932,660 472,529 100.0 50,333 10.7
Unaffiliated customers 522,862 4,932,660 472,529 50,333 10.7
Intersegment - - - - -
Operating expenses 466,335 89.2 4,399,387 451,993 95.7 14,342 3.2
Operating income 56,527 10.8 533,273 20,536 4.3 35,991 175.3
Recording media &
systems
Net sales 136,000 100.0 1,283,019 136,351 100.0 (351) -0.3
Unaffiliated customers 136,000 1,283,019 136,351 (351) -0.3
Intersegment - - - - -
Operating expenses 138,205 101.6 1,303,820 134,807 98.9 3,398 2.5
Operating income (loss) (2,205) -1.6 (20,801) 1,544 1.1 (3,749) -
TOTAL
Net sales 658,862 100.0 6,215,679 608,880 100.0 49,982 8.2
Unaffiliated customers 658,862 6,215,679 608,880 49,982 8.2
Intersegment - - - - -
Operating expenses 604,540 91.8 5,703,207 586,800 96.4 17,740 3.0
Operating income 54,322 8.2 512,472 22,080 3.6 32,242 146.0
Note: U.S.$1=Yen 106
2. Geographic segment information
FY2004 FY2003
(April 1, 2003 - March 31, (April 1, 2002
2004) - Mar. 2003) Change
Region/Term (Yen (U.S.$ (Yen
millions) % thousands) (Yen millions) % millions) %
Japan Net sales 329,782 100.0 3,111,151 334,882 100.0 (5,100) -1.5
Operating
income 8,538 2.6 80,547 5,193 1.6 3,345 64.4
Americas Net sales 104,400 100.0 984,906 101,784 100.0 2,616 2.6
Operating
income
(loss) 2,797 2.7 26,387 (1,082) -1.1 3,879 -
Europe Net sales 80,641 100.0 760,764 78,462 100.0 2,179 2.8
Operating
income
(loss) (115) -0.1 (1,085) (3,547) -4.5 3,432 96.8
Asia and Net sales
others 380,781 100.0 3,592,273 314,918 100.0 65,863 20.9
Operating
income 42,912 11.3 404,830 20,640 6.6 22,272 107.9
Intersegment Net sales 236,742 2,233,415 221,166 15,576
eliminations Operating
income
(loss) (190) (1,793) (876) 686
Total Net sales 658,862 100.0 6,215,679 608,880 100.0 49,982 8.2
Operating
income 54,322 8.2 512,472 22,080 3.6 32,242 146.0
Notes:
1. The sales are classified by geographic areas of the seller and include
transfers between geographic areas.
2. U.S.$1=Yen 106
3. Sales by region
FY2004 FY2003
(April 1, 2003 - March 31, (April 1, 2002 - Mar.
2004) 31, 2003) Change
Region/Term (Yen (U.S.$ (Yen
millions) % thousands) (Yen millions) % millions) %
Americas 89,657 13.6 845,821 106,060 17.4 (16,403) -15.5
Europe 81,950 12.4 773,113 78,740 12.9 3,210 4.1
Asia and others 318,599 48.4 3,005,651 258,577 42.5 60,022 23.2
Overseas sales
total 490,206 74.4 4,624,585 443,377 72.8 46,829 10.6
Japan 168,656 25.6 1,591,094 165,503 27.2 3,153 1.9
Net sales 658,862 100.0 6,215,679 608,880 100.0 49,982 8.2
Notes:
1. Sales by region are classified by geographic areas of the buyer.
2. U.S.$1=Yen 106
Consolidated
I-10) Fair Value of Securities
Gross Gross
Unrealized Unrealized Fair
(Yen millions) Cost Holding Gains Holding Losses Value
As of March 31, 2004
Equity securities 2,782 1,054 - 3,836
Debt securities 1,101 0 0 1,101
Total 3,883 1,054 0 4,937
As of March 31, 2003
Equity securities 3,455 122 11 3,566
Debt securities 2,495 3 - 2,498
Total 5,950 125 11 6,064
U.S.$1=Yen 106 Gross Gross
(U.S.$ thousands) Cost Unrealized Holding Gains Unrealized Holding Losses Fair Value
As of March 31, 2004
Equity securities 26,245 9,943 - 36,188
Debt securities 10,387 0 0 10,387
Total 36,632 9,943 0 46,575
I-11) Fair Value of Derivatives
Estimated
Contract Carrying Fair
(Yen millions) Amount Amount Value
As of March 31, 2004
Forward foreign exchange contracts 18,638 396 396
Currency option contracts 16,340 91 91
Currency swap agreements for loans to its
subsidiaries 12,605 252 252
As of March 31, 2003
Forward foreign exchange contracts 19,016 39 39
Currency swap agreements for loans to its
subsidiaries 13,794 (287) (287)
Estimated
(U.S.$ thousands) Contract Carrying Fair
U.S.$1=Yen 106 Amount Amount Value
As of March 31, 2004
Forward foreign exchange contracts 175,830 3,736 3,736
Currency option contracts 154,151 858 858
Currency swap agreements for loans to its
subsidiaries 118,915 2,377 2,377
Consolidated
I-12) Supplementary Information
Exchange rates used for conversion
April 1, 2003 - March 31, 2004 April 1, 2002 - March 31, 2003
Item/Term US$=Yen Euro=Yen US$=Yen Euro=Yen
Sales 113.19 132.65 121.98 120.88
The end of the
period 105.69 128.88 120.20 129.83
Consolidated
April 1, 2003 - March 31, April 1, 2002 - March 31,
2004 2003
Amount Ratio to Amount Ratio to Change
Item/Term (Yen millions) sales (%) (Yen millions) sales (%) (%)
Capital expenditures 44,866 - 41,451 - 8.2
Depreciation and
amortization 51,233 7.8 57,789 9.5 -11.3
Research and
development 34,495 5.2 31,862 5.2 8.3
Result of financial
income 866 802 8.0
Number of employees 36,804 31,705
(as at the end of
the period)
Ratio of overseas
production 58.9% 56.0%
OVERSEAS SALES BY DIVISION
April 1, 2003 - March April 1, 2002 - March
31, 2004 31, 2003
Amount Ratio to Amount Ratio to Change
Product/Term (Yen millions) sales (%) (Yen millions) sales (%) (%)
Electronic materials
and components 386,736 58.7 341,615 56.1 13.2
Electronic materials 121,446 18.5 122,761 20.2 -1.1
Electronic devices 61,373 9.3 58,671 9.6 4.6
Recording devices 195,137 29.6 152,476 25.0 28.0
Semiconductors & others 8,780 1.3 7,707 1.3 13.9
Recording media &
systems 103,470 15.7 101,762 16.7 1.7
Overseas sales 490,206 74.4 443,377 72.8 10.6
Non-Consolidated
II. Non-Consolidated
II-1) Summary
Non-Consolidated results (April 1, 2003 - March 31, 2004)
FY2004 FY2003
(April 1, 2003 - Mar. 31, 2004) (April 1, 2002 - Mar. 31, 2003) Change
(U.S.$ (Yen
Item/Term (Yen millions) % thousands) (Yen millions) % millions) %
Net sales 316,050 100.0 2,981,603 320,697 100.0 (4,647) -1.4
Operating
income 1,756 0.6 16,566 3,182 1.0 (1,426) -44.8
Current
income 10,277 3.3 96,952 9,078 2.8 1,199 13.2
Net income 4,458 1.4 42,056 133 0.0 4,325 3,251.9
Per common
share:
Net income /
Basic Yen 32.87 U.S.$0.31 Yen 0.53
Net income /
Diluted Yen 32.86 U.S.$0.31 -
Dividends
per share Yen 30.00 U.S.$0.28 Yen 25.00
Notes:
1. Any portion less than Yen one million is disregarded, the same being
applicable hereinafter. U.S.$1=Yen 106 (U.S. dollar translation is added herein
solely for convenience of readers outside Japan.)
2. The figures for net income per common share are calculated based upon the
weighted average number of shares of common stock (the total outstanding
number).
(Sales breakdown)
FY2004 FY2003
(April 1, 2003 - Mar. 31, (April 1, 2002 - Mar. 31,
2004) 2003) Change
Product/Term (U.S.$ (Yen mil
(Yen millions) % thousands) (Yen mil lions) % lions) %
Electronic
materials and
components 271,043 85.8 2,557,009 278,006 86.7 (6,963) -2.5
Electronic
materials 130,925 41.4 1,235,141 133,325 41.6 (2,400) -1.8
Electronic devices 81,096 25.7 765,056 86,274 26.9 (5,178) -6.0
Recording devices 40,227 12.7 379,500 46,437 14.5 (6,210) -13.4
Semiconductors &
others 18,793 5.9 177,292 11,968 3.7 6,825 57.0
Recording media &
systems 45,006 14.2 424,584 42,690 13.3 2,316 5.4
Total sales 316,050 100.0 2,981,603 320,697 100.0 (4,647) -1.4
Overseas sales 182,928 57.9 1,725,735 176,461 55.0 6,467 3.7
Note: U.S.$1=Yen 106
Non-Consolidated
II-2) Statements of income (Non-Consolidated)
FY2004 FY2003
(April 1, 2003 - Mar. 31, (April 1, 2002 -
2004) Mar. 31, 2003) Change
Item/Term (Yen (U.S.$ (Yen (Yen
millions) % thousands) millions) % millions) %
Net sales 316,050 100.0 2,981,603 320,697 100.0 (4,647) -1.4
Cost of sales 255,372 80.8 2,409,169 262,053 81.7 (6,681) -2.5
Gross profit 60,677 19.2 572,424 58,643 18.3 2,034 3.5
Selling, general and
administrative expenses 58,921 18.6 555,858 55,461 17.3 3,460 6.2
Operating income 1,756 0.6 16,566 3,182 1.0 (1,426) -44.8
Other income
(deductions):
Interest and dividend
income 3,369 31,783 2,803 566
Technology commission 7,784 73,433 3,754 4,030
Interest expense (26) (245) (18) (8)
Foreign exchange gain
(loss) (2,471) (23,311) (532) (1,939)
Other-net (134) (1,264) (112) (22)
Total other income
(deductions) 8,521 2.7 80,386 5,895 1.8 2,626 44.5
Current income 10,277 3.3 96,952 9,078 2.8 1,199 13.2
Extraordinary profit 1,816 0.6 17,132 351 0.1 1,465 417.4
Extraordinary loss (6,410) -2.1 (60,471) (7,806) -2.4 1,396 -17.9
Income before income
taxes 5,683 1.8 53,613 1,623 0.5 4,060 250.2
Income taxes 1,224 0.4 11,547 1,489 0.5 (265) -17.8
Net income 4,458 1.4 42,056 133 0.0 4,325 3,251.9
Note: U.S.$1=Yen 106
Non-Consolidated
II-3) Balance sheets (Non-Consolidated)
ASSETS
As of Mar. 31,
As of Mar. 31, 2004 2003 Change
Item/Term (Yen (U.S.$ (Yen (Yen
millions) % thousands) millions) % millions)
Current assets 261,758 49.8 2,469,415 224,917 44.1 36,841
Cash 59,450 560,849 55,240 4,210
Marketable securities 15,398 145,264 11,399 3,999
Net trade receivables 82,464 777,962 74,566 7,898
Inventories 24,574 231,830 26,136 (1,562)
Other current assets 79,870 753,490 57,574 22,296
Noncurrent assets 264,385 50.2 2,494,198 284,643 55.9 (20,258)
Investments in
securities 3,202 30,207 4,082 (880)
Investments in
affiliates 107,949 1,018,386 107,888 61
Net property, plant and
equipment 114,294 1,078,245 123,737 (9,443)
Other assets 38,938 367,339 48,934 (9,996)
TOTAL 526,143 100.0 4,963,613 509,561 100.0 16,582
LIABILITIES AND STOCKHOLDERS' EQUITY
As of Mar. 31,
As of Mar. 31, 2004 2003 Change
Item/Term (Yen (U.S.$ (Yen (Yen
millions) % thousands) millions) % millions)
Current liabilities 72,832 13.8 687,094 60,672 11.9 12,160
Trade payables 38,704 365,132 32,843 5,861
Accrued expenses 12,831 121,047 8,387 4,444
Income taxes payables 2,282 21,528 52 2,230
Other current liabilities 19,014 179,377 19,389 (375)
Noncurrent liabilities 37,432 7.2 353,132 29,646 5.8 7,786
Retirement and severance
benefits 37,128 350,264 29,337 7,791
Director's retirement allowance 303 2,858 309 (6)
Total liabilities 110,264 21.0 1,040,226 90,319 17.7 19,945
Common stock 32,641 307,933 32,641 -
Additional paid-in capital 59,256 559,018 59,256 -
Legal reserve 8,160 76,981 8,160 -
Retained earnings 321,674 3,034,660 323,999 (2,325)
Net unrealized gains (losses)
on securities 484 4,566 37 447
Treasury stock (6,338) (59,792) (4,854) (1,484)
Total stockholders' equity 415,878 79.0 3,923,377 419,241 82.3 (3,363)
TOTAL 526,143 100.0 4,963,613 509,561 100.0 16,582
Note: U.S.$1=Yen 106
Non-Consolidated
II-4) Management Changes
1. Candidate for election to the Board of Directors
Takehiro (General manager, Data Storage & Thin Film Technology
Kamigama components Business Group)
2. Retiring
director
Hirokazu (General manager, China Business Development Group)
Nakanishi
3. Candidate for election to the Board of Corporate Auditors
Ryoichi Ohno * (Chief Financial Officer, The Gibraltar Life Insurance Co.,
Ltd. Vice President, Finance, Prudential Financial, Inc.)
* Outside Corporate Auditor
4. Retiring
corporate
auditors
Osamu Nakamoto
*
* Outside Corporate Auditor
Non-Consolidated
II-5) Supplementary Information
Ratio of results on a Consolidated basis to results on a Non-Consolidated basis
Ratio of the previous
Ratio of the FY2004 fiscal year
Net sales 2.1 1.9
Operating income 30.9 6.9
Income before income
taxes 5.4 11.1
Net income 9.4 90.4
Exchange rates used for conversion
April 1, 2003 - March 31, 2004 April 1, 2002 - March 31, 2003
Item/Term US$=Yen Euro=Yen US$=Yen Euro=Yen
Sales 113.19 132.65 121.98 120.88
The end of the
period 105.69 128.88 120.20 129.83
Non-Consolidated
April 1, 2003 - March April 1, 2002 - March
31, 2004 31, 2003
Amount Ratio to Amount Ratio to
Change
Item/Term (Yen sales (Yen sales
millions) (%) millions) (%) (%)
Capital expenditures 19,627 - 24,959 - -21.4
Depreciation and amortization 25,109 7.9 26,529 8.3 -5.4
Research and development 24,759 7.8 22,530 7.0 9.9
Result of financial income 3,373 2,829 19.2
Number of employees (as at
the end of the period) 6,113 6,212
Contacts:
Nobuyuki Koike
TDK Corporation
Corporate Communications Dept.
Tel: (81)-3-5201-7102
E-mail; nkoike@mb1.tdk.co.jp
FOR IMMEDIATE RELEASE
TDK Issues Stock Acquisition Rights for Stock Options
TOKYO JAPAN, April 28, 2004 - TDK Corporation (the "Company") (President:
Hajime Sawabe) announces that at the meeting of the Board of Directors held on
April 28, 2004, a resolution passed that the issue of stock acquisition rights
with specially favorable terms and conditions to persons other than
stockholders for the purpose of implementing stock options pursuant to Articles
280-20 and 280-21 of the Commercial Code of Japan will be proposed for approval
at the 108th Ordinary Annual General Meeting of Stockholders scheduled for
Tuesday, June 29, 2004.
1. Reason for Issuing Stock Acquisition Rights with specially Favorable
Terms and Conditions to Parties Other Than Stockholders:
TDK will implement a stock option program for Directors, Corporate Executive
Officers and high-ranking Managers of TDK and group companies. The stock option
program is designed to provide TDK's key personnel with further incentive for
enhancement of consolidated operating results.
2. Matters Pertaining to the Issuance of Stock Acquisition Rights:
(1) Class and Number of Shares to be Issued upon exercise the Stock
Acquisition Rights:
Up to 380,000 shares of common stock
In the event that the number of shares allocated per stock acquisition rights
(as defined below) is adjusted in accordance with (2) below, the maximum number
of shares to be issued for the purpose of granting stock acquisition rights
shall be calculated by multiplying the aggregate number of stock acquisition
rights to be issued by the number of shares after adjustment.
(2) Aggregate Number of Stock Acquisition Rights to Be Issued:
Up to 3,800
The number of shares per stock acquisition right (hereinafter the "number of
shares granted") shall be 100. Provided, however, that in the event that the
Company makes a stock split or stock consolidation for its common stock on and
after the date on which stock acquisition rights are issued (hereinafter the
"issue date"), the number of shares granted shall be adjusted proportionately
based on the stock split or stock consolidation ratio. Fractions less than one
share arising out of such adjustment shall be discarded.
(3) Issue Price of Stock Acquisition Rights:
Free of charge
(4) Total Amount Due Upon Exercise of Stock Acquisition Rights:
The total amount due upon exercise of stock acquisition rights shall be the
price to be paid for each share, issued or transferred upon the exercise of
rights (hereinafter the "exercise price"), multiplied by the number of shares
granted.
The exercise price shall be an amount which is the average of the closing price
(regular way) of the Company's shares of common stock on the Tokyo Stock
Exchange on each day (other than any day on which no sale is reported) of the
month immediately preceding the date of the issuance of stock acquisition
rights, multiplied by 1.05. Any amount less than one yen arising out of such
adjustment shall be rounded upward to the nearest yen.
Provided, however, that, if such price is less than the closing price as of the
date of issue of stock acquisition rights, then such closing price reported on
the date of issue of stock acquisition rights shall be the exercise price.
In case the Company issues new shares or disposes of its own shares at a price
less than the current market price after the issue date, the exercise price
shall be adjusted in accordance with the following formula and any amount less
than one yen arising out of such adjustment shall be rounded upward to the
nearest yen:
Number of � Amount paid
shares
per share
newly
Number issued
of
shares +
issued
Current market price
Exercise price Exercise Number Number of new shares
after = price � of +
adjustment before shares increased after stock split
adjustment issued or new issuance
In the above formula, the "number of shares issued" shall be defined as the
number of shares of common stock issued and outstanding less the number of
treasury stock. In the event that the Company disposes of treasury stock, the
"number of shares newly issued" shall be read as "number of treasury stock to
be transferred." Provided, however, that in the event that the Company makes a
stock split or stock consolidation for its common stock on and after the issue
date, the exercise price shall be adjusted proportionately based on the stock
split or stock consolidation ratio. Fractions less than one share arising out
of such adjustment shall be discarded.
(5) Exercise Period for Stock Acquisition Rights:
From August 1, 2006 to July 31, 2010
(6) Conditions for Exercising of Stock Acquisition Rights:
Partial exercise of stock acquisition rights is not permitted.
(7) Reasons and Conditions for the Cancellation of Stock Acquisition Rights:
(1) The Company may cancel these stock acquisition rights without
compensation, if a proposal for approval of a merger agreement, under which the
Company is the dissolving company, is approved at a meeting of stockholders of
the Company, or if a proposal for approval of a stock exchange agreement or a
proposal for share transfer that makes the Company a wholly owned subsidiary,
is approved at a meeting of stockholders of the Company.
(2) In the event that the Company acquires unexercised stock acquisition
rights, it may cancel these stock acquisition rights without compensation at
any time.(8) Transfer Restrictions of Stock Acquisition Rights:
The transfer of stock acquisition rights requires the approval of the Board of
Directors of the Company.
3. Matters Pertaining to the Allotment of Stock Acquisition Rights: When
granting stock acquisition rights, the Company shall execute a "Agreement of
Allotment of Stock Acquisition Rights" with each eligible person. This
Agreement sets forth the following conditions that the Company's Board of
Directors has deemed reasonable for deciding on the issuance of stock
acquisition rights.
(1) In the event that Eligible Directors and corporate officers, who have
been granted such stock acquisition rights, are removed from their respective
offices, voluntarily resign, or lose their positions due to disqualification,
stock acquisition rights may not be exercised. Provided, however, that this
excludes the situation where a Director, corporate officer or employee is
dismissed or resigns due to a change in their position.
(2) Eligible employees who leave due to dismissal for cause, demotion,
involuntary release or voluntary resignation may not exercise these rights.
(3) Eligible persons who leave an eligible post for a reason other than those
listed above (1) and (2) may exercise these options for a period of two years
following the date they become no longer to hold the post.
(4) The stock acquisition rights may not be sold, transferred, disposed of
and inherited upon the death of the holder.
(5) The Agreement shall also specify other matters that limit the exercise of
stock acquisition rights in addition to the above.
Note: Subject to approval at the 108th Ordinary Annual General Meeting of
Stockholders scheduled for Tuesday, June 29, 2004, the specific details of the
issue and granting of stock acquisition rights will be determined at a meeting
of the Board of Directors to be held subsequent to the closing of the said
Ordinary Annual General Meeting of Stockholders.
# # #
Contacts:
Nobuyuki Koike
TDK Corporation
Corporate Communications Dept.
Tel: (81)-3-5201-7102
e-mail; nkoike@mb1.tdk.co.jp
FOR IMMEDIATE RELEASE
TDK to Buy Back Shares
(Acquisition of Treasury Stock Under Article 210 of the Commercial Code of
Japan)
TOKYO JAPAN, April 28, 2004 - TDK Corporation (the "Company") (President:
Hajime Sawabe) announces that at the meeting of the Board of Directors held on
April 28, 2004 a resolution passed that share buyback in accordance with
Article 210 of the Commercial Code of Japan will be proposed at the 108th
Ordinary Annual General Meeting of Stockholders scheduled for Tuesday, June 29,
2004.
1. Reason for Share Buyback
TDK will repurchase its own shares so that it may transfer treasury stock upon
exercise of stock acquisition rights under the stock option program.
2. Details of the Share Buyback
(1) Type of shares to be repurchased: common stock
(2) Number of shares to be repurchased: Up to 380,000 shares
(3) Total cost: Up to �3.4 billion
Note: The period of share buyback will start on or after such share buyback is
resolved at the 108th Ordinary Annual General Meeting of Stockholders to be
held on June 29, 2004 and extend until the closing of the next ordinary annual
general meeting of stockholders.
(Reference)
Number of treasury stock held as of March 31, 2004:
Total number of shares issued (excluding treasury stock): 132,409,452 shares
Number of treasury stock: 780,207 shares
# # #
END
TDK (LSE:TDK)
Historical Stock Chart
From Aug 2024 to Sep 2024
TDK (LSE:TDK)
Historical Stock Chart
From Sep 2023 to Sep 2024