Toshiba 2004 Annual Report Download - page 36

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Toshiba Group comprises Toshiba Corporation, 319 consolidated subsidiaries (203 in Japan,
116 overseas) and 64 equity method affiliates (32 in Japan, 32 overseas). The results for fiscal
2003, ended March 31, 2004, consolidate four more subsidiaries than the previous fiscal year.
This follows a strategic restructuring and change in consolidation policy that added 35
companies to the consolidation while excluding 31 companies, both in Japan and overseas,
some of which were integrated into other Group companies, while others were sold or liquidated.
> NET SALES
Consolidated net sales for fiscal 2003 were ¥5,579.5 billion (US$52,637 million), down by 1%
year on year. This slight decline primarily resulted from business transfers, among them joint
ventures with Matsushita Electric Industrial Co., Ltd. in CRTs and with Mitsubishi Electric
Corporation in the industrial systems business. The electronic devices segment, centered on
semiconductors and LCDs, reported strong sales results, while PCs and peripherals as well as
color TVs recorded sales declines.
The average exchange rate for the Japanese yen to the U.S. dollar appreciated by ¥9, from
¥122 to ¥113, which had a negative influence on sales for the fiscal year under review. The
exchange rate with the euro was ¥133, a ¥13 depreciation from ¥120 in fiscal 2002. These
shifts had an overall negative impact on net sales of ¥63.0 billion.
> NET SALES BY REGION
Millions of yen
Years ended March 31 20 04 20 03 20 02
Japan ¥3,399,903 ¥3,343,551 ¥3,340,491
Asia 829,914 837,845 659,820
North America 710,108 860,306 825,902
Europe 517,235 509,620 453,093
Others 122,346 104,456 114,727
Net Sales ¥5,5 79,506 ¥5,655,778 ¥5,394,033
Note: These figures are based on geographic location of the market in which sales were
recorded, and therefore differ from the segment sales reported on p. 39, which are based on the
location of the distribution source.
> JAPAN—Sales of ¥3,399.9 billion (US$32,075 million) were higher than in the previous
fiscal year, despite business transfers, including the joint venture with Matsushita Electric
Industrial Co., Ltd. in CRTs and the joint venture with Mitsubishi Electric Corporation in
industrial systems. Electronic devices, including semiconductors and LCDs, recorded positive
results.
> ASIA—Sales of ¥829.9 billion (US$7,829 million) were 1% lower year on year, due to the
transfer of the CRT business.
> NORTH AMERICA—Sales of ¥710.1 billion (US$6,699 million) were 17% lower than in the
previous fiscal year, the result of declines in thermal power plant projects, portable PCs and
color TVs, as well as the impact of the transfer of the CRT business.
> EUROPE—Sales of ¥517.2 billion (US$4,880 million) were slightly higher than in the
previous fiscal year, due to healthy sales of electronic devices, including semiconductors.
> NET INCOME (LOSS)
Net sales totaled ¥5,579.5 billion (US$52,637 million), down ¥76.3 billion compared with the
previous fiscal year. The gross profit margin improved 0.3 point to 27.0%, largely as a result of
cost reduction programs, reviews of procurement sources and increased overseas procurement.
The cost of sales and overhead costs were ¥15.3 billion lower than in the previous fiscal year
due to business transfers and the transfer to the government of the employees’ pension fund, a
move that generated income of ¥48.9 billion (US$462 million). Operating income was ¥174.6
billion (US$1,647 million), ¥59.0 billion more than in the previous fiscal year.
Non-operating loss totaled ¥29.6 billion (US$279 million), a ¥32.8 billion improvement
from the previous fiscal year. This was primarily due to sales of securities totaling ¥32.5 billion
and a ¥13.4 billion gain on foreign currency transactions. Negative factors included a ¥15.2
billion increase in restructuring costs. Net financial expenses were ¥10.4 billion (US$98
million), a ¥0.5 billion improvement from the previous fiscal year primarily due to reduced
interest expenses.
SCOPE OF
CONSOLIDATION
RESULTS OF
OPERATIONS