Epson 2011 Annual Report Download - page 27

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26
Minority interests in income
Minority interests in income for the period under review were ¥170 million, compared to ¥1 million in the
previous period. This was due to a decrease in losses distributed proportionally to minority interests in the period
under review in conjunction with Epson Toyocom Corporation becoming a wholly owned subsidiary during the
previous period.
Net income
As a result of the foregoing, Epson posted net income of ¥10,239 million, a ¥30,030 million increase from the
previous period.
(2) Liquidity and capital resources
Cash flow
Net cash provided by operating activities in the period under review was ¥32,395 million, down ¥24,146 million
from the previous period. Among the factors contributing to increased cash flow were the recording of a ¥16,181
million increase in income before income taxes and minority interests, a ¥16,599 million effect from a decrease
in notes and accounts receivable-trade, and ¥9,909 million in business structure improvement expenses
associated with the transfer of the small- and medium-sized displays business. Factors contributing to the
decrease included a ¥40,965 million effect from a decrease in notes and accounts payable-trade accompanying
repayments, a ¥8,536 million effect from an increase in inventories due to a strategic build-up of product
inventory for the following year, the recording of a ¥7,269 million impairment loss in the preceding period
associated with the small- and medium-sized displays business, and a ¥6,236 million decrease in depreciation
and amortization due to more rigorous selectivity in investments in past years.
Net cash used in investing activities totaled ¥23,615 million, down ¥19,588 million from the previous period.
Cash used in the year under review decreased due to ¥13,405 million used to acquire subsidiary company shares
in the previous period.
Net cash used in financing activities was ¥42,691 million, a ¥1,604 million increase compared to the previous
period. While loan repayments decreased, net cash used in financing activities increased mainly as a result of a
¥2,621 million increase in dividend payments as the company's financial performance improved.
Due to these factors, as of March 31, 2011, cash and cash equivalents at the end of the period stood at ¥211,777
million, a drop of ¥42,812 million from the previous period , giving Epson sufficient liquidity.
The combined total of short- and long-term loans payable was ¥180,722 million, a decrease of ¥28,338 million
compared to the previous period, owing to progress in repaying general interest-bearing liabilities.
Long-term loans payable (excluding the current portion), which comprise the majority of loans, amount to
¥107,500 million as of March 31, 2011, at a weighted average interest rate of 1.62% and with a repayment
deadline of March 2015. These borrowings were obtained as unsecured loans primarily from banks.
Financial condition
Total assets as of March 31, 2011 stood at ¥798,229 million, a decrease of ¥71,861 million from the previous
fiscal year-end due primarily to a decrease in current assets. Current assets declined by ¥52,680 million. The
main cause of the decrease was a ¥42,811 million total decline in cash and deposits and in securities, mainly due
to repayment of interest-bearing liabilities and payment of notes and accounts payable-trade. Total property,
plant and equipment declined by ¥11,731 million, primarily because of a more rigorous approach to the selection
of investments. Total liabilities as of March 31, 2011 were ¥527,421 million, down ¥59,804 million from the
previous fiscal year. This decrease in total liabilities was due to repayment of interest-bearing liabilities that
results in a decrease in short-term loans payable, current portion of bonds, current portion of long-term loans
payable, bonds payable, and long-term loans payable totaling ¥38,338 million, as well as a ¥17,935 million
decrease in notes and accounts payable-trade.
Retained earnings increased by ¥6,243 million, largely as a result of having posted net income. Nevertheless,