Isuzu 2004 Annual Report Download

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01
Isuzu is one of the world’s leading manufacturers of commercial vehicles
and diesel engines. Always an innovator, Isuzu introduced Japan’s first
diesel engine in 1936, and today we are leading the way in developing
environmentally friendly diesel technology. We are the market leader in at
least one product category in 23 different countries and our products are
found in over 130 countries around the world. For example, in Japan we led
the market for 2–3 ton trucks with a 36.1% market share in fiscal 2004, and
in the U.S. Isuzu has been the leader in imported class 3 and class 7 low
cab forward (LCF) trucks for 18 straight years.
Trucks
>>
Isuzu trucks are trusted around the world for their
reliability on the job and durability even under the
most demanding conditions. We are the world’s
largest manufacturer of medium-duty trucks and
our lineup of trucks—ranging from the light duty N
series (ELF in Japan) to the heavy duty C&E series
(GIGA in Japan)—is designed to meet the needs
of any business. Isuzu trucks exceed today’s
stricter environmental standards, offering cleaner
emissions as well as advanced safety features.
Isuzu innovations include Japan’s first “4-bag” air
suspension and the “Smoother” series of
transmissions for easy handling and better fuel
economy. Isuzu also offers services such as
seminars on economical operating techniques
and consulting on meeting emissions standards.
Truck Lineup
Heavy-duty trucks Japan: • GIGA series
Overseas: • C&E series
Medium-duty trucks Japan: • FORWARD series
Overseas: • F series
Light-duty trucks Japan: • ELF series
Overseas: • N series
ISUZU AT A GLANCE
Key Events in the History of Isuzu
>>
Japan’s first domestically produced truck, a Wolseley
model A-9, rolls out of the Tokyo Ishikawajima
Shipbuilding and Engineering plant
December
1922
The first Hillman passenger car rolls out of Isuzu. By
January 1957 all parts are locally made.
October
1953
Isuzu unveils the ELF TL model light-duty truck
August
1959
Isuzu unveils the 117 coupe passenger car
October
1968
Isuzu unveils the FORWARD TR model 4-ton truck
April
1970
Isuzu and US-based General Motors sign basic
agreement for comprehensive business pact
July
1971

Table of contents

  • Page 1
    ... in Japan we led the market for 2-3 ton trucks with a 36.1% market share in fiscal 2004, and in the U.S. Isuzu has been the leader in imported class 3 and class 7 low cab forward (LCF) trucks for 18 straight years. Trucks >> Isuzu trucks are trusted around the world for their reliability on the job...

  • Page 2
    Isuzu Motors Limited Annual Report 2004 Buses >> Our ERGA and ERGA Mio buses are powered by fuel-efficient, low-emission Isuzu diesel engines, with CNG power plants available on some models. The highly rigid body structure of these buses complies with the Economic Commission for Europe's (ECE) ...

  • Page 3
    ...direct-injection, diesel-cycle, mono-fuel, CNGpowered ELF light-duty truck in collaboration with Westport Innovations, Inc. of Canada at the Michelin Challenge Bibendum, considered one of the premier global events for advanced technology vehicles. Isuzu is moving forward on research and development...

  • Page 4
    ... the highest priority on product quality. Our long-term management vision is to transform Isuzu into a company that leads the way in engineering distribution systems. To accomplish this, we will: • Build an earnings base that is centered on commercial vehicles • Advance our technology to create...

  • Page 5
    Isuzu Motors Limited Annual Report 2004 CONSOLIDATED FINANCIAL HIGHLIGHTS Thousands of U.S. dollars Millions of yen Year ended March 31 For the Year: Net sales Net income (loss) At Year End: Total assets Shareholders' equity 2004 ¥1,430,339 54,713 2003 ¥1,349,449 (144,301) 2002 ¥1,597,701 (...

  • Page 6
    ... I d a President & Representative Director Fiscal 2004 (ended March 31, 2004) was a pivotal year for Isuzu. In fiscal 2003 we embarked on our New Three-Year Business Plan, and with the support of our shareholders, customers, suppliers, and other stakeholders, in fiscal 2004 our efforts to radically...

  • Page 7
    ... where we are strongest-commercial vehicles and diesel engines. Sales in these areas grew remarkably thanks to the introduction of stricter emission regulations in Japan and our aggressive marketing efforts overseas. Our business is steadily growing in ASEAN and China locations where we took the...

  • Page 8
    ...earnings structure. Our core markets will be Japan; promising markets in China and ASEAN where we have taken the lead in establishing local facilities; and North America. The integration of our bus operations with those of Hino Motors is helping us to create an even more efficient business structure...

  • Page 9
    ... even in SUVs and developing our commercial vehicle business. Streamlining our distribution structure in Japan is another key issue for Isuzu. Although we have been able to steadily lift the operating cost coverage ratio by working to cover our dealerships' fixed costs with revenue generated from...

  • Page 10
    ... of key technologies Super-Clean Diesel Engine Lower fuel costs, more Powerful, Quieter ...all at once Post-treatment technology Combustion Oxidation catalyst optimization technology Diesel Particulate Defuser Fuel injection system Selective catalytic Combustion system reduction (urea) Turbocharger...

  • Page 11
    ... heavy-duty GIGA series trucks equipped with the Smoother-G transmission system that regulates consumption. shifting to manage fuel Diesel Particulate Defuser Nox Catalyst Super-Clean Diesel Engines As environmental problems become increasingly serious on a global scale, emissions regulations...

  • Page 12
    ENVIRONMENTAL & SOCIAL ACTIVITIES Environmental Efforts At Isuzu, we have taken a two-pronged approach to environmental responsibility. We aim to (1) develop cleaner vehicles and (2) minimize the environmental burden of our manufacturing facilities. 12

  • Page 13
    ...improved lineup of GIGA heavy-duty trucks that conformed to new Japanese emission rules for 12-ton and bigger trucks one year earlier than required. We have also equipped our ELF and GIGA series trucks with new "Smoother" series transmissions that help manage fuel consumption. Finally, we opened the...

  • Page 14
    ... for executing business strategies to the operating level. In addition, we have implemented a Vehicle Line Executive (VLE) scheme. The Vehicle Line Executives, who are responsible for each of our product areas-commercial vehicles, light commercial vehicles and powertrains-report directly to the...

  • Page 15
    ISUZU MOTORS LIMITED ANNUAL REPORT 2004 FINANCIAL SECTION Exceeding Consumer Expectations, Maximizing Corporate Value Five-Year Summary MD&A Consolidated Balance Sheets Consolidated Statements of Operations Consolidated Statements of Shareholders' Equity Consolidated Statements of Cash Flows Notes...

  • Page 16
    FINANCIAL SECTION Isuzu Motors Limited Annual Report 2004 Consolidated Five-Year Summary Millions of yen Thousands of U.S. dollars 2004 For the Year: Net sales Cost of sales Gross profit Selling, general and administrative expenses Operating income (loss) Income (loss) before special items Income...

  • Page 17
    ... market for pickup trucks and a 25% share of the overall vehicle market. North American sales fell 33.4% to ¥251,563 million as we worked to improve marketing efficiency, right-size inventory, and implement appropriate incentive programs as part of our effort to build a realistic business structure...

  • Page 18
    ... Business Plan. North America North American sales fell 34.7% to ¥235,386 million, with the decline largely attributable to fact that we are no longer treating DMAX Ltd., our Ohio diesel manufacturing facility, as a consolidated subsidiary since a majority 60% share is now held by General Motors...

  • Page 19
    ..., sell, and distribute its products as well as to build and maintain good relationships with our business partners. For marketable securities, a downturn in share prices could have a negative impact on the earnings and financial position of the Isuzu group. Isuzu provides management guidance and...

  • Page 20
    FINANCIAL SECTION Isuzu Motors Limited Annual Report 2004 Consolidated Balance Sheets Assets Current Assets: Cash and cash equivalents (Note 2,4) Receivables: Notes and accounts (Note 4) Less : allowance for doubtful receivables Inventories (Note 4) Deferred taxes (Note 6) Other current assets ...

  • Page 21
    Isuzu Motors Limited Annual Report 2004 Consolidated Balance Sheets Liabilities and Shareholders' Equity Current Liabilities: Bank loans Current portion of bonds Commercial paper Notes and accounts payable Accrued expenses Accrued income taxes (Note 6) Deposits received Deferred tax current ...

  • Page 22
    ..., plant and equipment, net Gain on sales of investments Gains on return of substituted portions of employee pension fund (Note 2,5) Loss on revaluation of investments Loss on business model reform Loss on investment for affiliated company restructuring Severance benefit of early retirement plan...

  • Page 23
    Isuzu Motors Limited Annual Report 2004 Consolidated Statements of Shareholders' Equity 2004 Common Stock and Preferred Stock: Balance at beginning of the year Add: Issuance of common stock Issuance of preferred stock The exercise of stock acquisition right Deduct: Capital deduct (off-set with ...

  • Page 24
    FINANCIAL SECTION Consolidated Statements of Cash Flows Isuzu Motors Limited Annual Report 2004 (For the years ended March 31, 2004, 2003 and 2002) Millions of yen Thousands of U.S. dollars 2004 Cash Flows from Operating Activities Net income (loss) before income taxes and minority interests ...

  • Page 25
    ...to severance payments based on compensation at the time of severance and years of service. The Company has adopted the new Financial Accounting Standard for retirement benefits in Japan effective from April 1, 2000. In accordance with this standard, accrued employees' retirement b) Foreign Currency...

  • Page 26
    FINANCIAL SECTION Isuzu Motors Limited Annual Report 2004 benefits at March 31, 2001 have been provided mainly at an amount calculated based on the retirement benefit obligation and the fair value of the pension plan assets as of March 31, 2001 as adjusted for unrecognized actuarial gain or loss. ...

  • Page 27
    ... subscription: January 7, 2004 10. Date of payment: January 7, 2004 The Company issued 1st Series Unsecured Convertible Bonds in fiscal year 2004. The contents are as follows. (*) 1. Name of the Bonds: Isuzu Motors Limited 1st Series Unsecured Convertible Bonds (bonds with stock acquisition rights...

  • Page 28
    FINANCIAL SECTION Isuzu Motors Limited Annual Report 2004 14. Method and date of payment of interest: Not applicable. in Item 21, by indicating the bonds for which a request for early redemption is made, and by stating the date of request and other matters, and by affixing their respective names ...

  • Page 29
    ...request delivery of, shares of common stock of the Company at a price less than the current market price of the shares of common stock of the Company and in certain other cases. (11) Substitute Payment: Pursuant to Items 7 and 8, Paragraph 1 of Article 341-3 of the Commercial Code of Japan, when the...

  • Page 30
    ... Place of acceptance of Request for Exercise: Transfer Agent: UFJ Trust Bank Limited, Securities Agency Department From September 1, 2003, The Company amended the Employee Pension Fund to establish the cash balance pension plan. (2) Retirement benefit cost for the year ended March 31, 2004. Millions...

  • Page 31
    ... 31, 2004 were as follows: Millions of yen Thousands of U.S. dollars 7. Shareholders' Equity On October 1, 2001, an amendment (the "Amendment") to the Commercial Code of Japan (the "Code") became effective. The Amendment eliminates the stated par value of the Company's outstanding shares, which...

  • Page 32
    ... Isuzu Motors Limited Annual Report 2004 preferentially registered pledges in a given business year does not reach the amount of the preferred dividend, the shortfall will not be carried over to the next business year for accumulation. When the residual property of the Company is to be distributed...

  • Page 33
    ...price) of daily closing prices (including quoted price) in regular transactions of common stocks of the Company at the Tokyo Stock Exchange. during 30 business days starting from 45th business day preceding the date of revision of conversion price (hereinafter referred to as actual value calculation...

  • Page 34
    ... price) of daily closing prices (including quoted price) in regular transactions of common stocks of the Company at the Tokyo Stock Exchange during 30 business days starting from 45th business day preceding the date of revision of conversion price (hereinafter referred to as actual value calculation...

  • Page 35
    ... of daily closing prices (including quoted price) in regular transactions of common stocks of the Company at the Tokyo Stock Exchange. during 30 business days (excluding days without closing price) starting from 45th business day preceding the first day of period for claiming conversion (calculated...

  • Page 36
    ... Isuzu Motors Limited Annual Report 2004 (b) Revision of Conversion Price Conversion price is revised to the average price (excluding days without closing price) of daily closing prices (including quoted price) in regular transactions of common stocks of the Company at the Tokyo Stock Exchange...

  • Page 37
    Isuzu Motors Limited Annual Report 2004 The method of revaluation is as follows: Under article 3-3 of the enforcement ordinance for the law, the land price for the revaluation is determined based on the official notice prices assessed and published by the National Land Agency of Japan, after ...

  • Page 38
    FINANCIAL SECTION Isuzu Motors Limited Annual Report 2004 12. Segment Information (1) The business segment information for the Company and its consolidated subsidiaries for the years ended March 31, 2004 and 2003 was as follows: Automotive Year ended March 31, 2003 Sales to third parties Interarea...

  • Page 39
    Isuzu Motors Limited Annual Report 2004 Japan Year ended March 31, 2003 Sales to third parties Interarea sales and transfers Total sales Operating expenses Operating income (loss) Total assets 812,932 129,523 942,455 923,139 19,316 901,618 North America 351,543 8,664 360,208 371,727 (11,518) 84,...

  • Page 40
    ... Motors Limited and consolidated subsidiaries as of March 31, 2004, 2003 and 2002, and the related consolidated statements of operations, shareholders' equity, and cash flows for the years then ended, all expressed in yen. These financial statements are the responsibility of the Company's management...

  • Page 41
    ...Huan North Road, Chao Yang District, Beijing, The People's Republic of China Tel: 86-10-6590-8957 P. T. Astra Isuzu Casting Company (AICC) Isuzu Autoparts Manufacturing Corporation (IAMC) 114 North Main Avenue, Phase III, Special Economic Zone, Laguna Technopark, Binan, Laguna 4024, Philippines Tel...

  • Page 42
    BOARD OF DIRECTORS Isuzu Motors Limited Annual Report 2004 ቫ ቭቪ ቨ ...Officer Fujio Anzai Shigeji Nakamori Yoshiyuki Miyatake Hakaru Shibata Ryozo Tsukioka Makoto Ushiyama Tsutomu Yamada Chikao Mitsuzaki Shunichi Satomi Yasuaki Shimizu Akira Shinohara CORPORATE AUDITORS >> Standing Corporate...

  • Page 43
    ... 140-8722, Japan Tel: +81-3-5471-1141 Head Office Fax: +81-3-5471-1043 Plants and Other Facilities Kawasaki Plant Tochigi Plant Fujisawa Plant Isuzu Engine Manufacturing Hokkaido Corporation Wa.com Hokkaido Co., Ltd. Manufacturing of heavy-duty engines and parts Manufacturing of engines and parts...