Fujitsu 2013 Annual Report Download - page 27

Approach to Financing Activities and Credit Rating Status
To ensure efficient fund procurement when the need for funds arises, Fujitsu views the maintenance of an appropriate level of liquidity as an important policy with respect to its financing
activities. “Liquidity” refers to cash and cash equivalents and the total unused balance of financing frameworks based on commitment lines established with multiple financial institutions. As of
March 31, 2013, the Group had liquidity of ¥482.3 billion ($3,027 million), of which ¥284.5 billion ($30,271 million) was cash and cash equivalents and ¥197.7 billion ($21,039 million) was
the yen value of unused commitment lines.
To raise funds from global capital markets, the Group has acquired bond ratings from Moody’s Investors Service (Moody’s), Standard & Poor’s (S&P), and Rating and Investment Information, Inc.
(R&I). As of March 31, 2013, the Company had bond ratings (long-term/short-term) of A3 (long-term) from Moody’s, BBB+ (long-term) from S&P, and A (long-term) and a-1 (short-term) from R&I.
Foreign Exchange Effects
Yen appreciation in the first half of the fiscal year turned into yen depreciation in the second half. For fiscal 2012, the average yen exchange rates against major currencies were ¥83 to the U.S. dollar
(representing a yen depreciation of ¥4), ¥107 to the euro (an appreciation of ¥2), and ¥131 to the British pound (a depreciation of ¥5). As a result, foreign exchange fluctuations for fiscal 2012 saw
the U.S. dollar and the British pound increase net sales by approximately ¥20 billion and ¥10 billion, respectively. The euro had a negligible impact on net sales. The resulting ratio of sales outside
Japan was 34.2%, an increase of 0.5 of a percentage point compared to the previous fiscal year. The Fujitsu Group makes every effort to reduce the impact of foreign exchange movements on
earnings. However, in fiscal 2012, exchange rates had the impact of reducing operating income by ¥5.0 billion year on year. In terms of exchange rate sensitivity, every change of ¥1 in the yen’s
exchange rate in fiscal 2012 against the U.S. dollar, euro and British pound had an impact on operating income of approximately ¥0.2 billion, ¥0.1 billion, and ¥0 billion, respectively.
Yen (billions)
Years ended March 31 2012 2013
YoY
Change
Change
(%)
Net sales . . . . . . . . . . . . . . . . . . 4,467.5 4,381.7 (85.8) (1.9)
Cost of sales . . . . . . . . . . . . . . . . 3,232.1 3,177.9 (54.1) (1.7)
Gross profit . . . . . . . . . . . . . . . . 1,235.4 1,203.7 (31.6) (2.6)
Selling, general and
administrative expenses . . . . . 1,130.1 1,108.4 (21.6) (1.9)
Operating income . . . . . . . . . . . 105.3 95.2 (10.0) (9.5)
Other income (expenses) . . . . . (38.5) (140.3) (101.8) —
Income (loss) before income
taxes and minority interests
. . . 66.7 (45.1) (111.8) —
Income taxes . . . . . . . . . . . . . . . 29.9 24.2 (5.7) (19.1)
Minority interests in
income (loss) of
consolidated subsidiaries . . . . (5.9) 3.5 9.5 —
Net income (loss) . . . . . . . . . . . 42.7 (72.9) (115.6) —
Yen (billions)
As of March 31 2012 2013
YoY
Change
Assets
Current assets . . . . . . . . . . . . . . . . . 1,701.7 1,722.2 20.5
Property, plant and equipment . . . . 640.9 618.4 (22.4)
Intangible assets . . . . . . . . . . . . . . . 230.2 187.3 (42.9)
Investments and
other non-current assets . . . . . . . . 372.4 520.9 148.4
Total assets . . . . . . . . . . . . . . . . . . . 2,945.5 3,049.0 103.5
Liabilities
Current liabilities . . . . . . . . . . . . . . . 1,420.3 1,568.5 148.1
Long-term liabilities . . . . . . . . . . . . 558.5 570.7 12.1
Total liabilities . . . . . . . . . . . . . . . . . 1,978.9 2,139.2 160.3
Net assets
Shareholders’ equity . . . . . . . . . . . . 926.0 832.5 (93.4)
Accumulated other
comprehensive income . . . . . . . . . (85.0) (51.1) 33.8
Minority interests in
consolidated subsidiaries . . . . . . . 125.4 128.3 2.8
Total net assets . . . . . . . . . . . . . . . . 966.5 909.8 (56.7)
Total liabilities and net assets . . . . . 2,945.5 3,049.0 103.5
Cash and cash equivalents at
end of year . . . . . . . . . . . . . . . . . . . . 266.6 286.6 19.9
Interest-bearing loans . . . . . . . . . . . . . 381.1 534.9 153.8
Net interest-bearing loans . . . . . . . . . 114.4 248.3 133.9
Owners’ equity . . . . . . . . . . . . . . . . . . . 841.0 781.4 (59.6)
Notes: Year-end balance of interest-bearing loans: Short-term borrowings and current
portion of bonds payable (Current liabilities) + Long-term borrowings and bonds
payable (Long term liabilities)
Net interest-bearing loans: Interest-bearing loans – Cash and cash equivalents
Owners’ equity: Net assets – Subscription rights to shares – Minority interests in
consolidated subsidiaries
of the LSI assembly and testing facilities. In addition, person-
nel-rationalization expenses were included in restructuring
charges for the LSI devices business. The restructuring charges
for business outside Japan consist of personnel-related
expenses, primarily for the European subsidiary Fujitsu Tech-
nology Solutions (Holding) B.V. (FTS) Other restructuring
charges include losses mainly related to the personnel-related
expenses associated with rationalizations at managerial levels
in Japan.
The impairment loss stems mainly from an impairment loss
recorded on unamortized goodwill and intangible assets with
respect to the European subsidiary FTS In light of continued
deterioration of economic conditions in Europe, the business
plan of FTS was revised as investments planned at the time of
acquisition are less likely to be collectible, leading to the
recording of the impairment loss.
As a result, Fujitsu recorded a net loss of ¥72.9 billion,
representing a deterioration of ¥115.6 billion from net income
in fiscal 2011.
Financial Initiatives in Fiscal 2012
The owners’ equity ratio decreased by 3.0 percentage points
compared to the previous fiscal year-end, to 25.6%. The
decrease primarily reflected lower shareholders’ equity mainly
due to the net loss posted for the year and the payment of
year-end dividends for fiscal 2011 and interim dividends for
fiscal 2012. Consolidated total assets at the end of fiscal 2012
amounted to ¥3,049.0 billion, an increase of ¥103.5 billion
from the end of fiscal 2011. This represented an increase of
approximately ¥110.0 billion as a result of yen depreciation.
The balance of interest-bearing loans amounted to ¥534.9
billion, an increase of ¥153.8 billion from the previous fiscal
year-end. Short-term borrowings increased to finance a potion
of working capital and a special contribution into UK pension
plans.Consequently, the D/E ratio was 0.68 times, an increase
of 0.23 of a point and the net D/E ratio was 0.32 times,
an increase of 0.18 point from the previous fiscal year-end.
Condensed Consolidated Income Statements
Condensed Consolidated Balance Sheets
Corporate Executive Vice President and Director,
Chief Financial Officer
Kazuhiko Kato
025
FUJITSU LIMITED ANNUAL REPORT 2013
MANAGEMENT