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Hitachi, Ltd. Annual Report 2006
76
25. SUPPLEMENTARY CASH FLOW INFORMATION
Thousands of
Millions of yen U.S. dollars
2006 2005 2004 2006
Cash paid during the year for:
Interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥ 31,584 ¥ 30,706 ¥32,128 $ 269,949
Income taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 118,486 123,541 93,858 1,012,701
Noncash investing and financial activities:
Capitalized lease assets . . . . . . . . . . . . . . . . . . . . . . ¥ 5,206 ¥ 2,109 ¥ 3,998 $ 44,496
Conversion of convertible debentures
issued by the Company . . . . . . . . . . . . . . . . . . . . . . –21 –
Conversion of convertible debentures
issued by subsidiaries . . . . . . . . . . . . . . . . . . . . . . . –11,054 6,769 –
During the year ended March 31, 2005, the Company acquired and merged an affiliated company through exchange of
equity securities procedure as shown in note 29.
The proceeds from sale of securities classified as available-for-sale discussed in note 4 are included in both decrease in
short-term investments and proceeds from sale of investments and subsidiaries’ common stock on the consolidated
statements of cash flows.
24. SUPPLEMENTARY INCOME INFORMATION
Thousands of
Millions of yen U.S. dollars
2006 2005 2004 2006
Taxes other than income taxes consist of the following:
Property . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥ 39,975 ¥ 39,597 ¥ 40,001 $ 341,667
Welfare . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 204,124 192,763 199,630 1,744,649
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25,551 22,890 12,969 218,385
¥269,650 ¥255,250 ¥252,600 $2,304,701
Maintenance and repairs . . . . . . . . . . . . . . . . . . . . . . . ¥ 82,786 ¥ 73,952 ¥ 69,084 $ 707,573
Research and development expense . . . . . . . . . . . . . . 405,079 388,634 371,825 3,462,214
Advertising expense . . . . . . . . . . . . . . . . . . . . . . . . . . . 52,175 53,405 48,512 445,940
Rent. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 149,241 137,179 142,649 1,275,564
26. DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES
Overall risk profile
The major manufacturing bases of the Company and its subsidiaries are located in Japan and Asia. The selling bases are
located globally, and the Company and its subsidiaries generate approximately 40% of their sales from overseas. These
overseas sales are mainly denominated in the U.S. dollar or Euro. As a result, the Company and its subsidiaries are
exposed to market risks from changes in foreign currency exchange rates.
The Company’s financing subsidiaries in the U.K., the U.S. and Singapore issue variable rate medium-term notes mainly
through the Euro markets to finance its overseas long-term operating capital. As a result, the Company and its
subsidiaries are exposed to market risks from changes in foreign currency exchange rates and interest rates.
The Company and its subsidiaries are also exposed to credit-related losses in the event of non-performance by
counterparties to derivative financial instruments, but it is not expected that any counterparties will fail to meet their
obligations because most of the counterparties are internationally recognized financial institutions and contracts are
diversified into a number of major financial institutions.