Konica Minolta 2007 Annual Report Download - page 38

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business had a positive affect on the overall profit margin. The weaker yen was an additional
positive earnings factor. As a result, operating income for the fiscal year ended March 2007
increased 24.7% to ¥104.0 billion, while the operating income ratio improved by 2.3 percentage
points from 7.8% to 10.1%.
Net other expenses (income) improved by ¥120.2 billion over the previous fiscal year to a sur-
plus of ¥0.9 billion. The major factors behind this improvement included the absence of (1) a
¥96.6 billion charge for costs related to the decision to exit the Photo Imaging business last
fiscal year, (2) a goodwill amortization charge of ¥2.4 billion related to the prior management
integration, and (3) a provision of ¥6.5 billion for the special outplacement program recorded the
previous fiscal year. For the fiscal year ended March 2007, a gain on the sale of fixed assets of
¥7.3 billion related to the exit from the Photo Imaging business, and gains of ¥2.8 billion on the
sale of investment securities were recorded. In addition, interest expenses declined because of a
reduction in interest-bearing debt.
As a result of the above, income before income taxes and minority interests was ¥104.9 billion
and net income for the period was ¥72.5 billion. Net income per share of common stock was
¥136.67, while ROE (return on equity) was 21.9% and ROA (operating income + interest and div-
idend income return on total assets) was 11.2%.
Liquidity and Financial Position
Total Assets, Liabilities and Shareholders’ Equity/Net Assets
Total assets at the end of the fiscal year were ¥7.0 billion higher than at the end of the previous
fiscal year at ¥951.1 billion.
In current assets, notes and accounts receivable–trade increased by ¥11.1 billion due to growth
in sales. In addition, inventories declined by ¥15.9 billion and allowance for doubtful accounts
declined by ¥4.3 billion, mainly as a result of the exit from the Photo Imaging business.
In property, plant and equipment, the book value of mainly machinery and equipment, build-
ings and structures, and land declined by ¥34.9 billion as a result of asset sales related to the
decision to exit the Photo Imaging business. However, as accumulated depreciation also increased
by ¥48.9 billion, the net value of property, plant and equipment increased ¥14.0 billion as a
result of capital expenditures mainly in the Business Technologies and Optics businesses. In other
asset categories, investment securities declined by ¥3.5 billion due to stock liquidations arising
from the sale of stock in affiliated companies and the unwinding of cross-holdings due to the
decision to exit the Photo Imaging business.
Under liabilities, interest-bearing debt declined by ¥7.2 billion to ¥229.4 billion. Short-term
debt declined by ¥55.4 billion, and the current portion of long-term debt declined by ¥5.0 billion.
On the other hand, long-term debt increased by ¥53.3 billion due to the issuance of convertible
bonds (¥70.3 billion).
In net assets, as net income for the period was ¥72.5 billion, retained earnings increased by
¥95.6 billion. On the other hand, as retained earnings were used to offset the loss at the end
of the previous fiscal year, additional paid-in capital declined by ¥21.9 billion, and unrealized
gains on securities declined by ¥2.7 billion because of the sale of stocks held. As a result of the
above, net assets at the end of the period increased by ¥72.1 billion over the end of the previous
fiscal year, and the equity ratio increased by 7.5 percentage points over the end of the previous
fiscal year to 38.6%.
Equity Ratio
(%)
2005 2006 2007
0
10
20
30
40
Interest Coverage Ratio
(Times)
2005 2006 2007
0
6
12
18
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