Oki 2007 Annual Report Download

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(For the year ended March 31, 2007)
2007
Annual Report

Table of contents

  • Page 1
    Annual Report 2007 (For the year ended March 31, 2007)

  • Page 2
    .... Stepping boldly onto the world stage, the OKI Group is targeting a 50% overseas sales ratio in the fiscal year ending March 2011, representing a significant leap from the 36% achieved the fiscal year ended March 2007. In the focus region of China, OKI is targeting a net sales ratio of 10%.

  • Page 3
    ...Printer businesses are already positioned fully in the global market spotlight. In addition, OKI aims to take bold strides forward in Info-Telecom System...on the improvement of regional structures rather than on Japan-centered operations, OKI continues to make advances in its overseas business: ...

  • Page 4
    ...2007. Within the OKI Group, sales in the financial system business increased owing to healthier capital investment within the financial market, while sales of color LED* non-impact printers..., OKI has resolved to implement a human resource shift affecting 1,700 employees. 3 Annual Report 2007

  • Page 5
    ... beyond Europe, the Americas and Japan, while also pursing sustained earnings in its dot impact printer category. In addition to these three strategies, OKI will ... In addition, OKI is looking to boost profitability in the large LCD driver business and further focus on system LSIs with differentiated...

  • Page 6
    ... CTstage® CTI* system, which boasts the leading market share in the contact center market in Japan. These technologies prove that we already possess significant strengths in the technological Q2. You have designated an "accelerated selection and concentration" scheme as one of OKI's policies to...

  • Page 7
    ...technologies together is one of OKI's unique strengths. In the Printer segment, our LED print-head and mechatronics technologies, which ...customized models to meet regional needs. We are now working to expand our leading IP-based key telephone systems for SMB offices throughout China, Europe...

  • Page 8
    ...services, accessible to users anytime and anywhere. f i le 1: Koji Shibaike System Engineer Marketing & Sales Division, Systems Hardware Company Oki Electric Industry Co., Ltd. Japan Develop user-centered ATMs The ATMs installed at supermarkets and convenience stores.... 7 Annual Report 2007

  • Page 9
    Group 2. New factory in China begins ATM production Oki Electric Industry (Shenzhen) Co., Ltd., which manufactures ATMs, printers and other equipment, transferred its operations to a new facility, starting production in January 2007. The new facility, which has twice the ï¬,oor space and triple the ...

  • Page 10
    ... its quest for greater corporate sales in overseas markets, OKI is developing full-scale key telephone systems that support IP telephony and mobile functions, while undertaking aggressive business phone sales activities across the world, including in China and India. * FMC: Fixed Mobile Convergence...

  • Page 11
    ... as external lines when away from the LAN. Also, it accommodates SIP*1 soft phone functions, the first telephone system of its kind in Japan. Sales are already under way in China, with OKI planning gradual expansion targeting Asian and Pacific regions. *1 SIP: Session Initiation Protocol; a major...

  • Page 12
    .... In an environment where railway stations are undergoing increasing change due to the introduction of web-based ticket reservation and on-line payment systems, I hope to continue to promote OKI's truly cutting-edge products and technologies-with honesty, tenacity and smiles. 11 Annual Report 2007

  • Page 13
    ... disaster prevention system Utilizing urgent earthquake reports from the Japan Meteorological Agency and early P-wave tremor detection capabilities, OKI's real-time earthquake disaster prevention system provides advance warning before a major S-wave quake arrives. The system cuts off the supply of...

  • Page 14
    ... a keen work awareness. OKI's semiconductors have an excellent reputation for technological superiority and excellent quality in the global market. In a spirit of teamwork, we are making efforts to proactively nurture employees into future OKI leaders in the Asian region. 13 Annual Report 2007

  • Page 15
    ...intensity on a single chip, the new IC does not require an optical cut filter, which allows manufacturers to develop compact and highly mobile UV devices at low cost. In addition to conventional applications such as accessory-type devices to measure the amount of UV in daylight, OKI plans to expand...

  • Page 16
    ...America, Southeast Asia and China, in addition to the United States, Europe and Japan, as it seeks further growth. In terms of product development, OKI released a new LED print-head that is half the size of conventional types and contributes to more compact, lower cost printers. In order to maintain...

  • Page 17
    ... constructed manufacturing site in January 2007. With production now under way, the company is expected to reach an annual production capacity of 600,000 units, tripling its previous production volume of color LED and dot-impact printers. Supplying printers to over 120 countries, OKI has positioned...

  • Page 18
    ..., which opens up many possibilities in developing a variety of IC devices. OKI has applied its proprietary EFB technology to create a new type of LED print-head for printers. Thinned LED array chips and driver IC chips that have been integrated using intermolecular bonding force are, as a single...

  • Page 19
    ... their choice via the MAILPIA Web site. Making registration even easier for those who use mobile phones to access Web sites-usually intended for personal computer Web browsing-OKI has launched a mobile-browser-supported service site that cuts down on access and download time, making mobile access to...

  • Page 20
    ... ensures transparency in the criteria and mechanisms used to ...ficials. The Compliance Committee, headed by the Chief Compliance Offi...System Selection/dismissal Collaboration Audit Supervision OKI's Corporate Governance Structure 19 Annual Report 2007 (As of June 11, 2007) Japan's new Corporation...

  • Page 21
    ...-product recovery system and realize eco-friendly recycling methods. Contributing to Society OKI Supports Elementary School Project in China In the fiscal year ending March 2007, the OKI Group participated in a special project in China that was organized by Foster Parents Plan Japan. The second...

  • Page 22
    ..., Manufacturing Service Company Directors Sei Yano General Manager, Corporate Strategy Planning Office Mikihiko Maeno President and CEO, Oki Data Corporation Minoru Morio *2 *1 *2 *3 *4 Representative Directors External Director Executive Vice President External Auditors (As of June 29, 2007...

  • Page 23
    ... Consolidated Statements of Operations...31 Consolidated Statements of Cash Flows ...32 Consolidated Statements of Changes in Net Assets...33 Notes to Consolidated Financial Statements...35 Report of Independent Auditors...48 22

  • Page 24
    ... income per share Cash dividends per share Number of shareholders Number of employees Ratios (%): (Note 2) Return ...annual report are translated from yen, for convenience only, at ¥118=US$1.00, the approximate exchange rate prevailing on March 31, 2007. Note 2: Effective the year ended March 31, 2007...

  • Page 25
    Financial Review Annual Report for Oki Electric Industry Co., Ltd. and its Consolidated Subsidiaries SCOPE OF CONSOLIDATION In the fiscal year ended March 31, 2007, 17 companies, including 11 equity-method subsidiaries, were newly included in the Group's scope of consolidation, while two other ...

  • Page 26
    ...Printers GEOGRAPHIC SEGMENT INFORMATION Japan In the domestic market, despite the downturn of investment in fixedline systems by telecommunication carriers, sales of financial institution system... Income ROE (%) 25 Annual Report 2007 Cash Flows from Operating Activities Cash Flows from ...

  • Page 27
    ... customers. Within this environment, the OKI Group is exerting efforts to raise the earning capacity of its Info-Telecom Systems segment. To this end, it plans to consolidate low-profit businesses, strengthen Company competitiveness, expand its software service business by creating a global software...

  • Page 28
    ...in the OKI Group's principal operating markets of Japan, North America, Europe and Asia may impact its business performance and financial position. (2) Sudden Technological Innovation The OKI Group's principal business segments comprising Info-Telecom Systems, Semiconductors and Printers are subject...

  • Page 29
    ... (Tokyo), Miyazaki Prefecture, Miyagi Prefecture and Thailand due to earthquake, wide and flood damage or power blackout may affect the OKI Group's performance and financial position. (11) Information Management Although the OKI Group implements defense measures to protect its internal systems...

  • Page 30
    Consolidated Balance Sheets Oki Electric Industry Co., Ltd. and consolidated subsidiaries As of March 31, 2007 and 2006 Millions of yen Thousands of U.S. dollars (Note 2) ASSETS Current assets: Cash and ...,923 4,202,915 7,093 5,429,500 (4,330,381) 1,099,118 300,974 $ 5,325,406 29 Annual Report 2007

  • Page 31
    ... liabilities Total liabilities NET ASSETS Shareholders' equity (Notes 9 and 18): Common stock: Authorized-2,400,000,000 shares Issued-684,256,778 shares in 2007 and 612,371,797 shares in 2006 Additional paid-in capital (Accumulated deficit) retained earnings Less: Treasury stock, at cost: 1,069,266...

  • Page 32
    ... of Operations Oki Electric Industry Co., Ltd. and consolidated subsidiaries Years ended March 31, 2007, 2006 and 2005 Millions of yen Thousands of U.S. dollars (Note 2) 2007 Net sales Cost...5,107 (211) 161 5,058 11,226 (297) 245 ¥ 11,174 (305,898) (2,322) (635) $ (308,864) 31 Annual Report 2007

  • Page 33
    Consolidated Statements of Cash Flows Oki Electric Industry Co., Ltd. and consolidated subsidiaries Years ended March 31, 2007, 2006 and 2005 Millions of yen Thousands of U.S. dollars (Note 2) 2007 Cash flows from operating activities: Net (loss) income Adjustments to reconcile net (loss) income to...

  • Page 34
    ...in Net Assets Oki Electric Industry Co., Ltd. and consolidated subsidiaries Years ended March 31, 2007, 2006 and 2005 Shareholders' equity (Accumulated deficit) retained earnings Numbers of shares ... 152,542 (15,542) (308,864) (338) (194) 1,406 (9,661) 2,728 (177,923) $ 855,838 33 Annual Report 2007

  • Page 35
    Valuation, translation adjustments and other Net Total unrealized valuation, holding gain Loss on translation on other deferred Translation adjustments securities hedges adjustments and other Warrants Minority interests in consolidated subsidiaries Total net assets Millions of yen ¥ 10,932 ¥ ...

  • Page 36
    ... subsidiaries March 31, 2007 1. SIGNI FI C A NT ACCOUNT ING P OLIC I ES (a) Basis of presentation Oki Electric Industry Co., Ltd. (the "Company") and its domestic consolidated subsidiaries (collectively and including its overseas subsidiaries, the "Group") maintain their books of account in...

  • Page 37
    ... estimated average remaining years of service of the participants in the ... difference between financial reporting and the tax bases...meet the required criteria are accounted for ...Japan... exist and if the book value of the fixed asset... rate prevailing on March 31, 2007. This translation should not be construed...

  • Page 38
    ... balance sheet 2006 Quoted market price Amount recorded in balance sheet 2007 Quoted market price Difference Difference Difference Held-to-maturity securities whose ... 900 0 8,686 460 ¥ 0 2006 ¥ ¥ - 100 - 3,701 - 11,046 600 2007 $ $ 0 847 7,627 0 73,610 3,898 23,754 37 Annual Report 2007

  • Page 39
    ... 2006 were as follows: Millions of yen Thousands of U.S. dollars 2007 Finished goods Work in process Raw materials and supplies ¥ 52,419 67,257 47,835 ¥167,513 2006 ¥ 53,277 69,231 44,392 ¥166,899 2007 $ 444,228 569,974 405,381 $1,419,601 5. INV ES T M ENT S IN A ND A DVA NC...

  • Page 40
    ... conversion price of ¥ 504 ($ 4.3) per share. *2 The zero coupon convertible bonds with stock acquisition rights due 2011 (the "Bonds" )...($18,254 thousand). As is customary in Japan, both short-term and long-term bank ...OKI Pension Fund which was established on January 1, 2005. 39 Annual Report 2007

  • Page 41
    ... their projected benefit obligation. Components of net periodic pension cost for the years ended March 31, 2007, 2006 and 2005: Millions of yen Thousands of U.S. dollars 2007 Service cost during the year Interest cost on projected benefit obligation Expected return on plan assets Amortization of...

  • Page 42
    ...(4) (5) ¥17,793 2007 $ 50,652 1,296 (177) (19,525) $ 32,237 Income taxes applicable to the Company and its domestic consolidated subsidiaries comprised corporation tax, inhabitants' taxes and... 50.4% (2.5) (6.3) 38.1% - - - 10.1 6.9 (3.5) 4.0 2.9 (1.0) - 2006 41.0% 2005 41.0% 41 Annual Report 2007

  • Page 43
    ...Corporation Law of Japan (the "Law"), which superseded most of the provisions of the Commercial Code of Japan...2007. As a result, the common stock and additional paid-in capital increased during the year ended March 31, 2007... production lines of Miyagi Oki Electric Industry Co., Ltd. were suspended and ...

  • Page 44
    ... restructuring of the Info-Telecom Systems business. 15. D ERI VAT...reporting system... control system to ...March 31, 2007, 2006 and...dollars Millions of yen 2007 Machinery and equipment Other ...6,749 ¥11,195 2007 $189,050 29,...payments subsequent to March 31, 2007 required under operating leases with...

  • Page 45
    ...Type of shares with warrants granted Number of shares with warrants granted Option price per warrant Exercise period Common stock 153,000 shares Â¥271 July 1, 2004âˆ' June 30, 2007 On June 26, 2007...of certain subsidiaries in accordance with the Corporation Law of Japan and Item 12 of the Company's ...

  • Page 46
    ...price of the Company's shares of common stock traded on the Tokyo Stock Exchange in the month prior to the date of the ...ended March 31, Info-Telecom Systems Semiconductors Printers Other Total 2007 Corporate and eliminations Consolidated Sales to...) ¥ 74,456 ¥ 1,927 ¥ 3,886 45 Annual Report 2007

  • Page 47
    ... Systems Semiconductors Printers Other Total 2007 Corporate and...on the nature of the products or services rendered and similarities in sales methodology. (2)...266 Millions of yen Year ended March 31, Japan North America Europe 2006 Corporate and Asia Total eliminations Consolidated Sales to third ...

  • Page 48
    ...Japan North America Europe 2005 Corporate... Year ended March 31, Japan North America Europe 2007 Corporate and Asia Total eliminations Consolidated...subsidiaries (other than exports to Japan), totaled ¥259,952 million... sales for the years ended March 31, 2007, 2006 and 2005, respectively. As presented...

  • Page 49
    Report of Independent Auditors 48

  • Page 50
    ...Korea Co., Ltd. Oki Semiconductor Singapore Pte. Ltd. Oki Techno Centre (Singapore) Pte. Ltd. Oki Data (Singapore) Pte. Ltd. Oki Systems (Thailand) Ltd. Oki (Thailand) Co., Ltd. Oki Data Manufacturing (Thailand) Co., Ltd. Oki Precision (Thailand) Co., Ltd. Europe Oki Europe Ltd. Oki (UK) Ltd. Oki...

  • Page 51
    ...by Shareholder Type (As of March 31, 2007) Japanese corporations and others Foreign corporation and others 7.6% 9.6% Japanese individual investors Annual Report Japanese financial institutes 56.2% 26.6% Economy * This annual report contains forward-looking statements concerning the OKI Group...

  • Page 52
    This entire brochure was printed in Japan using 100% plant-based soy ink and a waterless printing process on 70% recycled paper.