Harman Kardon 2007 Annual Report Download - page 64

Download and view the complete annual report

Please find page 64 of the 2007 Harman Kardon annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 95

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95

51
Note 3 - Property, Plant and Equipment
Property, plant and equipment are composed of the following:
June 30,
($000s omitted)
2007 2006
Land $
14,738
11,737
Buildings and improvements
269,968
244,960
Machinery and equipment
905,293
764,969
Furniture and fixtures
41,386
53,187
1,231,385
1,074,853
Less accumulated depreciation and amortization
(639,409) (552,918)
Property, plant and equipment, net $
591,976
521,935
Note 4 - Goodwill
Goodwill was $403.7 million at June 30, 2007 compared with $381.2 million at June 30, 2006. The
increase is primarily due to contingent consideration and deferred purchase price payments paid during
fiscal 2007 associated with prior year acquisitions. Currency translation also contributed to the increase.
Our SFAS 142 annual impairment test concluded that goodwill was not impaired as of the test date, April
30, 2007.
In fiscal 2006, goodwill increased $36.1 million, which was mainly due to the acquisition of PhatNoise
and our investment in a joint venture in Korea. Contingent consideration associated with the acquisition
of Innovation Systems in a prior fiscal year also contributed to the increase in goodwill.
Note 5 - Short-Term Borrowings
At June 30, 2007, we had outstanding short-term borrowings of $1.8 million with a weighted average
interest rate of 5.5 percent. The short-term borrowings were under unsecured lines of credit totaling $18.3
million in Japan, China and the United Kingdom. We had $1.8 million of outstanding short-term
borrowings with a weighted average interest rate of 5.3 percent at June 30, 2006.