Suzuki 2014 Annual Report Download

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2014

Table of contents

  • Page 1
    2014

  • Page 2
    ... in Review _____ 5 Automobiles _____ 6 Motorcycles _____ 9 Marine Products _____ 12 Others _____ 13 Topics _____ 14 Directors, Officers and Auditors _____ 17 Management Policy _____ 18 Risks in Operations _____ 24 The Status of the Corporate Group _____ 26 Financial Section _____ 28 Company Outline...

  • Page 3
    Mission Statement 1.Develop products of superior value by focusing on the customer 2.Establish a refreshing and innovative company through teamwork 3.Strive for individual excellence through continuous improvement SUZUKI MOTOR CORPORATION 1

  • Page 4
    ... compact motorcycle business mainly in Asia is still in the middle of reform. The Group will continuously be aiming at recovering its presence in the motorcycle market by uniting the planning, technology and sales functions and by developing new products that suit the market needs further. The Group...

  • Page 5
    ... its preparedness against natural disasters. The Group has carried out its operations on the basis of manufacturing of "value-packed products" to satisfy customers since its establishment with the motto "Develop products of superior value by focusing on the customer" in the first paragraph of its...

  • Page 6
    Financial Highlights Financial Highlights SUZUKI MOTOR CORPORATION AND CONSOLIDATED SUBSIDIARIES Years ended March 31, 2014 and 2013 Net sales ...Net income...Net income per share: Primary ...Fully diluted ...Cash dividends per share...Net assets ...Total current assets...Total assets ......

  • Page 7
    ...Net Sales By Market (Year ended March 31, 2014 Millions of yen) Marine & Power Products, etc. 56,046 1.9% Other 193,941 6.6% Motorcycle 266,602 9.1% Europe North America 394,714 13.4% 64,890 2.2% Japan 1,132,732 38.6% Automobile 2,615,664 89.0% Asia 1,152,034 39.2% SUZUKI MOTOR CORPORATION 5

  • Page 8
    ... the Swift compact car by adding a grade that includes the newly developed Dualjet engine (a unit that combines great fuel economy with powerful performance) and the Ene-Charge energy regenerative system. • In September 2013, Suzuki launched the first comprehensively enhanced version of the Carry...

  • Page 9
    ...Company launched the SX4 S-CROSS in China at the end of the fiscal year, but overall demand for compact cars was down. Suzuki's sales in the five key ASEAN countries (Indonesia, Thailand, Vietnam, the Philippines, and Malaysia) surged by 19% year-on-year to 225,000 units owing partly to strong sales...

  • Page 10
    Year in Review Three-row compact car Ertiga C-segment crossover SX4 S-CROSS Global compact car Celerio 8 SUZUKI MOTOR CORPORATION

  • Page 11
    ... reflected the market trend by growing for three years in a row. The Company plans to treat these highly profitable models as the focus of its sales-promotion efforts. Light, compact scooter BURGMAN 200 3. Suzuki Topics in Fiscal 2013 • In January 2014, Suzuki launched the half-faired GSR250S to...

  • Page 12
    ... of Suzuki's Main Overseas Motorcycle Markets Sales of motorcycles in Europe in fiscal 2013 were flat on the year at 821,000 units. Sales of motorcycles (including ATVs) in North America rose by 5% year-on-year to 801,000 units. Sales in the six key ASEAN countries (Indonesia, Thailand, Vietnam...

  • Page 13
    .... The Company unveiled the race machine it was developing. • In September 2013, the Suzuki Endurance Racing Team won the FIM Endurance World Championship for the fourth time in a row and the 13th time in total. • Also in September 2013, Suzuki unveiled new models in Europe: the V-Strom 1000 ABS...

  • Page 14
    ... models in Thailand and larger models at the Toyokawa Plant in Japan. DF60AV Suzuki Topic in Fiscal 2013 • In September 2013, Suzuki agreed with the French boat builder Bénéteau for an exclusive supply of Suzuki outboard motors to their outboard powered boats sold in four countries in Europe...

  • Page 15
    ... most fuel-efficient petrol-engine Auto Gear Shift car in Japan**; it delivers fuel economy of 35km/L*** (an improvement of 2km/L) together with nimble performance. Suzuki increased fuel efficiency by complementing the Alto Eco's existing fuel-saving technologies (for instance, the Ene-Charge energy...

  • Page 16
    ... consideration of female users. In December 2013, the car won the interior and design awards at the Japan Fashion Color Association's 2014 Auto Color Awards. August 2013 Announcement of Plans to Build Hamamatsu Plant Suzuki announced plans to build a production, research, development, and testing...

  • Page 17
    ... the Middle East and Latin America as a world strategic model. The SX4 S-CROSS also received maximum 5-star Euro NCAP overall safety rating, and proved its high safety perPrime Minister Viktor Orbán and Suzuki formance. Chairman and CEO Osamu Suzuki Unveiling of an Enhanced Alto Eco: the Most Fuel...

  • Page 18
    ..., Suzuki Motor (Thailand) Co., Ltd. as its second car that meets the eco-car project promoted by the government. It is planned to be distributed in Thailand and its neighboring countries as well as in Europe. Development of New Transmission Auto Gear Shift Auto Gear Shift is an automated manual...

  • Page 19
    ... Operations Deputy Executive General Manager, Automobile Engineering Executive General Manager, Manufacturing Executive General Manager, Finance / Managing Officer, Finance Dept. Executive General Manager, Corporate Planning Office President, Suzuki Motor Sales Hyogo Inc. President, Suzuki Motor...

  • Page 20
    ... internal reserve for future business developments from the medium- to long-term viewpoint, with the emphasis on the continuous and stable distribution. The Group has a structure in which profits are highly dependent on overseas manufacturing plants. They are mainly located in developing countries...

  • Page 21
    ... reviewed and basic concepts are adjusted and established. In order to embody the said basic concepts, The Company has the Corporate Planning Office. (Various meeting on execution of operation) The Company enhances efficiency of management by sharing important information on execution of operation...

  • Page 22
    ... correction of problems. The audit department also helps to make rules for enhancement of management structures, conducts guidance and supports for compliance with the laws, regulations and rules and promotes efficiency and standardization of their business. Company Auditors adjust audit plans and...

  • Page 23
    ... the "Suzuki Rules of Corporate Ethics" which lays out a set of basic points for Directors and employees to act in a fair and faithful manner in compliance with the laws, regulations, social rules and in-company rules. It is revised whenever necessary by "Corporate Ethics Committee" which promotes...

  • Page 24
    ... The subsidiaries report to The Company on their business operation and consult with The Company on important matters in accordance with those rules, and departments in charge give guidance and advice to them to enhance their management structure. And our audit department helps to make rules for the...

  • Page 25
    ... by the Business Accounting Council of Financial Services Agency, The Japanese government. Based on that assessment, our management executive concluded that our Group's internal control over financial reporting was effective as of March 31, 2014. Seimei Audit Corporation, The Company's Independent...

  • Page 26
    ... of The Group including motorcycles, automobiles and outboard motors. They may also affect the performance and financial conditions of The Group. In addition, we conduct businesses around the world, and our dependency on the overseas manufacturing plants especially in the developing countries of the...

  • Page 27
    ...export motorcycles, automobiles, outboard motors and related parts to various countries in the world from Japan. In addition, we export those products and parts from the overseas manufacturing plants to multiple other countries. Fluctuations of exchange rates may adversely affect the performance and...

  • Page 28
    ...main businesses are manufacturing and marketing of motorcycles, automobiles, marine & power products, motorized wheelchairs, electro senior vehicles and houses, further developing the businesses of logistics and other services related to the respective operations. The position of the group companies...

  • Page 29
    ... (Major companies only) No marks : Subsidiaries : Affiliates Flow of products, parts Flow of services M/C : Motorcycle A/M : Automobile M/P : Marine and Power products, etc. Overseas Manufacturing & Marketing Companies Magyar Suzuki Corporation Ltd. PT Suzuki Indomobil Motor Maruti Suzuki India...

  • Page 30
    ... Statements of Income and Consolidated Statements of Comprehensive Income ...34 Consolidated Statements of Changes in Net Assets ...36 Consolidated Statements of Cash Flows...37 Notes to Consolidated Financial Statements ...38 Independent Auditor's Report...63 28 SUZUKI MOTOR CORPORATION

  • Page 31
    ... profit from Japan by the impact of the exchange rate and increase in income in Asia. (c) Marine and Power products, etc. The net sales increased by ¥5.8 billion (11.6%) to ¥56.0 billion year-on-year, mainly owing to increase in sales of outboard motors in Europe. The operating income increased...

  • Page 32
    ... in consumption tax rate in Japan, and economic trends in emerging Asian markets such as India, Indonesia, and Thailand in overseas, The Group will work as one to reform in every field to accomplish more than the below forecasts for the consolidated operation by developing the business activity...

  • Page 33
    ...Fully diluted...Cash dividends per share...Net assets ...Total current assets...Total assets ...Depreciation and amortization... Note: Yen amounts are translated into US dollars for convenience only, at ¥102.92 = US$1, the prevailing exchange rate as of March 31, 2014. SUZUKI MOTOR CORPORATION 31

  • Page 34
    Consolidated Financial Statements Consolidated Balance Sheets As of March 31, 2014 and 2013 SUZUKI MOTOR CORPORATION AND CONSOLIDATED SUBSIDIARIES ASSETS Current assets: Cash and cash equivalents *NOTE 4 ...Receivables: Notes and accounts receivables-trade *NOTE 4 ...Allowance for doubtful accounts...

  • Page 35
    ...as of March 31, 2013 - 561,047,304...Capital surplus ...Retained earnings ...Treasury stock ...Total shareholders' equity ...Accumulated other comprehensive income: Valuation difference on available-for-sale securities ...Deferred gains or losses on hedges...Foreign currency translation adjustment...

  • Page 36
    ... (Consolidated Statements of Income) Years ended March 31, 2014 and 2013 SUZUKI MOTOR CORPORATION AND CONSOLIDATED SUBSIDIARIES Net sales ...Cost of sales ...Gross profit...Selling, general and administrative expenses ...Operating income ...Other income (expenses): Interest and dividend income...

  • Page 37
    Consolidated Financial Statements (Consolidated Statements of Comprehensive Income) Years ended March 31, 2014 and 2013 SUZUKI MOTOR CORPORATION AND CONSOLIDATED SUBSIDIARIES Income before minority interests ...Other comprehensive income Valuation difference on available-for-sale securities ......

  • Page 38
    ... Financial Statements Consolidated Statements of Changes in Net Assets Years ended March 31, 2014 and 2013 Millions of yen SUZUKI MOTOR CORPORATION AND CONSOLIDATED SUBSIDIARIES Balance as of March 31, 2012 Dividends from surplus .. Change in equity...Net income ...Purchase of treasury stock...

  • Page 39
    Consolidated Financial Statements Consolidated Statements of Cash Flows Years ended March 31, 2014 and 2013 SUZUKI MOTOR CORPORATION AND CONSOLIDATED SUBSIDIARIES Cash flows from operating activities Income before income taxes...Depreciation and amortization ...Impairment loss ...Increase (...

  • Page 40
    ... the opening balance of shareholders' equity, have been presented in US dollars by translating all Japanese yen amounts on the basis of 102.92 to US$1, the rate of exchange prevailing as of March 31, 2014. Consequently, the totals shown in the consolidated financial statements (both in yen and...

  • Page 41
    ... by The Company and its subsidiaries are available-for-sale securities. Available-for-sale securities for which market quotations are available are stated at market value method based on the market values as of the consolidated account settlement date (The evaluation differences shall be reported as...

  • Page 42
    ... Financial Statements (o) Method of depreciation and amortization of significant depreciable assets a. Property, plant and equipment (excluding lease assets) ...Mainly declining balance method for The Company and domestic subsidiaries and mainly straight-line method for foreign subsidiaries. Main...

  • Page 43
    ... companies with which The Group has business relationship, and as for listed stocks, The Group quarterly identifies those fair values and reports them to the Board of Directors. Most of accounts payable-trade are due within one year. Applications of borrowings are fund for operating capital (mainly...

  • Page 44
    ... Carrying amount ¥279,009 253,237 2013 Fair value ¥279,009 253,225 Difference ¥ - (12) Cash and deposits Notes and accounts receivables-trade Short-term investment securities and Investment securities Available-for-sale securities Investments in affiliates Total of assets Accounts payable-trade...

  • Page 45
    ... of deposits are approximately equal to the book values, book values are used as fair values. b. Notes and accounts receivables-trade Fair values of sales finance receivables are calculated on the discount method by the expected rate applied to new loan contract, on each receivable classified into...

  • Page 46
    ... Over 1 year, Within 5 years Over 5 years, Within 10 years Cash and deposits Notes and accounts receivables- trade Securities and i nvestment securities with maturities Total $ 3,486,699 2,422,623 5,951,125 $11,860,449 $ - 519,052 $ - 5,116 - $519,052 - $5,116 44 SUZUKI MOTOR CORPORATION

  • Page 47
    Consolidated Financial Statements (c) Securities a. Available-for-sale securities with market value as of March 31, 2014 and 2013 Millions of yen 2014 Acquisition cost Carrying Amount Difference Acquisition cost 2013 Carrying Amount Difference Securities for which the carrying amount exceeds the...

  • Page 48
    ...762 ¥762 762 ¥762 Thousands of US dollars 2014 Type Pay fixed receive floating Pay PHP receive USD Pay floating receive floating Pay INR receive USD Total 46 SUZUKI MOTOR CORPORATION Contract/ notional amount Amount due after one year Fair value Gain (loss) $11,659 $ - $ 822 $ 822 69...

  • Page 49
    ... Financial Statements Commodity-related transactions (market transactions) 2014 Type Commodity Futures contract Buying Total Contract/ notional amount Amount due after one year Fair value Gain (loss) Contract/ notional amount 2013 Amount due after one year Millions of yen Gain (loss) Fair value...

  • Page 50
    ... 154 - * AUD 19,817 - * NZD 3,406 - * GBP 2,932 - * MXN 6,722 - * CNY 545 - * Buying EUR 6,604 - * Total $309,588 - $(1,827) * Because these foreign currency forward contracts are handled together with hedged items, their fair values are included in that of hedged items. 48 SUZUKI MOTOR CORPORATION

  • Page 51
    ... Statements Cross currency interest rate swap transactions Principal hedged item: long-term debt Millions of yen 2014 Type Contract/ Amount due notional amount after one year Principle hedge accounting Pay fixed receive floating Pay JPY receive USD ¥121,243 ¥121,243 Pay fixed receive floating Pay...

  • Page 52
    ... 31, 2014 and 2013 were as follows. The annual interest rates of short-term borrowings as of March 31, 2014 were from 0.24 percent to 12.25 percent. Thousands of US dollars Millions of yen 2014 Short-term loans payable and current portion of Long-term loans payable Secured ...Unsecured ...Lease...

  • Page 53
    ... balance of this contract as of March 31, 2014 and 2013 were as follows: Millions of yen Thousands of US dollars 2014 Commitment line contract total ...Actual loan balance...Variance ¥200,000 - ¥200,000 2013 ¥200,000 - ¥200,000 2014 $1,943,256 - $1,943,256 SUZUKI MOTOR CORPORATION 51

  • Page 54
    ... amount of retirement benefits b. Discount rate c. Reassessment rate d. Assumed return of investment ratio e. Number of years for amortization of past service cost : Straight-line basis : Mainly 2.00% : 1.50% : Mainly 0.77% : Mainly 15 years To be amortized by straight-line method with certain term...

  • Page 55
    ... Financial Statements (Year ended March 31, 2014) 1. Outline of adopted retirement benefit systems As for The Company, cash balance corporate pension plan and lump-sum retirement benefit plan are established. And as for some of consolidated subsidiaries, defined benefit corporate pension plan...

  • Page 56
    ...of major components to total pension assets were as follows: Debt securities General account of life insurance companies Others Total 51.1% 38.0% 10.9% 100.0% b. Method to determine long-term expected return on plan assets Expected return on pension assets were determined by considering the current...

  • Page 57
    ... tax liabilities Valuation difference on available-for-sale securities ...Variance from the complete market value method of consolidated subsidiaries ...Reserve for advanced depreciation of noncurrent assets ...Others...Deferred tax liabilities total ...Net amounts of deferred tax assets ...Â¥(56...

  • Page 58
    ...assets The Companies Act of Japan requires that at least 50% of the contribution of new shares be included in capital stock. The portion to be recorded as capital stock is determined by resolution of the meeting of the Board of Directors. Proceeds in excess of the capital stock should be credited to...

  • Page 59
    ... date was in the next fiscal year Resolution Ordinary General Meeting of Shareholders held on June 27, 2014 Total amount of cash dividends Cash dividends per share Record date Effective date ¥7,854 million ¥14.00 $76,317 thousand $0.136 March 31, 2014 June 30, 2014 SUZUKI MOTOR CORPORATION 57

  • Page 60
    Consolidated Financial Statements NOTE 14: Stock option plan The Company adopts stock option plan by using subscription rights to shares. The plan was adopted at the Ordinary General Meeting of Shareholders and meeting of the Board of Directors held on June 28, 2012, June 27, 2013 and June 27, 2014...

  • Page 61
    ... Automobile Marine and Power products, etc. Main products and services Motorcycles, All-terrain vehicles Minivehicles, Sub-compact vehicles, Standard-sized vehicles Outboard motors, Engines for snowmobiles, etc., Electro senior vehicles, Houses 2. Methods of measurement for the amounts of net sales...

  • Page 62
    ... Financial Statements 3. Information about the amounts of net sales, profit or loss, assets and other items by reportable segment (Years ended March 31) Millions of yen 2014 Motorcycle Automobile Marine & Power products, etc. Adjustment Consolidated Net Sales: Net sales to external customers...

  • Page 63
    ... on location of The Company and its consolidated subsidiaries (Years ended March 31) Millions of yen 2014 Japan Europe Asia Other areas Eliminations Consolidated Net Sales: Net sales to external customers...Internal net sales or transfer among geographical areas ...Total Operating income...Â¥1,309...

  • Page 64
    ... ¥1,097,265 ¥2,938,314 Millions of yen 2013 Japan India Others Consolidated Net sales ... ¥1,040,948 ¥647,390 ¥889,977 ¥2,578,317 Thousands of US dollars 2014 Japan India Others Consolidated Net sales ... $11,005,950 $6,882,207 $10,661,338 $28,549,496 62 SUZUKI MOTOR CORPORATION

  • Page 65
    ...in Japan. The amounts expressed in U.S. dollars, which are provided solely for the convenience of the reader, have been translated on the basis set forth in Note 1 to the accompanying consolidated financial statements. Seimei Audit Corporation Tokyo, Japan June 27, 2014 SUZUKI MOTOR CORPORATION 63

  • Page 66
    ... authorized shares Total number of shares issued Number of shareholders Stock Listing Securities Code Ordinary General Meeting of Shareholders Record Dates Shareholders' Register Manager Name of Shareholder Volkswagen AG The Master Trust Bank of Japan, Ltd. (Trust Account...

  • Page 67
    ... Major Overseas Subsidiaries [Marketing Subsidiaries] 30 directly managed overseas marketing companies [ASIA] India India Pakistan Indonesia Thailand Thailand Malaysia Philippines Cambodia China Vietnam Taiwan Myanmar Maruti Suzuki India Ltd. Suzuki Motorcycle India Private Limited Pak Suzuki Motor...

  • Page 68
    MEMO 66 SUZUKI MOTOR CORPORATION

  • Page 69

  • Page 70
    300 Takatsuka-Cho, Minami-Ku, Hamamatsu-shi, Shizuoka, Japan 432-8611 http://www.globalsuzuki.com ANNUAL REPORT 2014 Printed in Japan