Brother International 2007 Annual Report Download - page 13

11
Brother Annual Report 2007
Total Assets
Fiscal years ended March 31
(¥ billion)
500
400
300
200
100
02006 20072005
343.8 348.2
399.1
Owners' Equity
Owners' Equity Ratio
Fiscal years ended March 31
(¥ billion)
300
250
200
150
100
50
02006 20072005
149.9
181.1
210.4
52.7
52.0
Owners' Equity
Owners' Equity Ratio
(%)
60
50
40
30
20
10
0
43.6
The Brother Group believes that its operating cash flow s, internal liquidity, including credit
facilities, and sound balance sheet can provide the necessary funds for w orking capital, capital
expenditures and R&D activities in order to sustain the group's grow th.
2) Cash Flow
Cash Flow from Operating Activities
Net cash provided by operating activities w as ¥47,773 million. Income before income taxes and
minority interests w as ¥45,788 million and depreciation and amortization w as ¥18,442 million. M ain
uses of cash were a ¥8,200 million increase in trade notes and accounts receivable, a ¥2,586 million
decrease in trade notes and accounts payable and income taxes paid of ¥10,402 million.
Cash Flow from Investing Activities
Net cash used in investing activities w as ¥35,864 million. This w as mainly attributable to payments
of ¥23,826 million for the purchase of property, plant and equipment, ¥5,136 million for the purchase
in intangible assets, and payments of ¥4,645 million for the purchase of stock in affiliated companies
due to a change in the scope of consolidation.
Cash Flow from Financing Activities
Net cash used in financing activities was ¥6,693 million. This includes debt repayments of ¥2,400
million for short-term and long-term loans and bonds and dividend payments of ¥3,870 million.
Outlook for Fiscal 2008
In the fiscal year ending in M arch 2008, the outlook for the U.S. economy is becoming increasingly
uncertain and economic grow th is expected to slow in Europe and Asia. In Japan, a slow pace of
grow th in the corporate sector is foreseen despite the outlook for healthy consumer spending.
The Brother Group expects higher sales in fiscal 2008 because of a continuation in strong sales
of communications and printing equipment. How ever, the group is forecasting declines in operat-
ing income and ordinary income. Substantial research and development expenses in the printing
business and new businesses aimed at supporting future grow th and higher depreciation expenses
resulting from grow th in capital expenditures are expected to hold dow n earnings. The Brother
Group is also forecasting low er net income as the application of tax-effect accounting results in
higher income taxes.
This outlook is based on yen exchange rates of ¥115 to the U.S. dollar and ¥150 to the euro.