Oki 2011 Annual Report Download - page 23

20
(Billions of yen) (%)
(Ended March 31)
R&D Expenses/
R&D Expenses to Net Sales
10
15
5
0
4
2
3
1
0
2009 2010 2011
16.8
14.6 13.8
3.1%
3.3% 3.2%
R&D Expenses (left scale)
R&D Expenses to Net Sales (right scale)
Annual Report 2011 21
decreased ¥20.4 billion from ¥172.5 billion at the previous fiscal
year-end, to ¥152.1 billion, due mainly to repayment of long-term
debt. Due to a modification of the Group’s retirement benefit sys-
tem, while the allowance for retirement benefits declined ¥23.3
billion, long-term payables increased ¥31.5 billion.
CASH FLOWS
Net cash provided by operating activities amounted to ¥1.6 billion,
down ¥49.7 billion from the previous fiscal year. This was mainly
due to a decrease in income before income taxes stemming from
implementation of the Group’s program to enhance its manage-
ment bases and an increase in working capital.
Net cash used in investing activities totaled ¥4.4 billion, down
¥8.6 billion from the previous fiscal year. Main outflows were for
purchases of property, plant, and equipment.
Free cash flows, which are the sum of cash from operating activi-
ties and investing activities, saw a net outflow of ¥2.8 billion,
compared with a net inflow of ¥38.3 billion in the previous fiscal year.
Net cash provided by financing activities was ¥11.2 billion,
compared with ¥31.3 billion in net cash used in financing activities
in the previous fiscal year. This was due to inflows stemming from
long-term debt and the issuance of Class A Preferred Stocks by
private placement to a third party, which more than offset outflows
from the repayment of long-term debt. As a result, cash and cash
equivalents at fiscal year-end stood at ¥79.6 billion, up from ¥71.2
billion a year earlier.
CAPITAL EXPENDITURES, DEPRECIATION, AND RESEARCH
AND DEVELOPMENT EXPENSES
Capital expenditures declined ¥0.6 billion year on year to ¥8.0 bil-
lion. This was because the Group restrained spending compared
with its initial plans due to a decline in sales amid economic stagna-
tion. Depreciation declined ¥0.8 billion year on year to ¥9.7 billion,
reflecting decreased capital expenditures. R&D expenses totaled
¥13.8 billion, down ¥0.8 billion from the previous fiscal year.
OUTLOOK FOR
FISCAL YEAR ENDING MARCH 31, 2012
In the fiscal year ending March 31, 2012, the world economy is
expected to continue recovering moderately, driven by such
emerging nations as China and India, where steady economic
expansion is anticipated. By contrast, the domestic economy is
expected to remain sluggish over the short term due to the impact
of the Great East Japan Earthquake. There are also concerns about
further economic stagnation due to the impact on production
activities of electric power supply restrictions and delays in the
procurement of parts and components.
During the year ahead, the OKI Group will celebrate the 130th
anniversary of its foundation. The year also represents the first
year of the Group’s brushed-up mid-term business plan. Despite
the impact of the earthquake, we forecast a ¥3.3 billion year-on-
year increase in consolidated net sales, to ¥436.0 billion. Factors
expected to boost sales include expansion of the services busi-
ness particularly ATM-LCM services and EXaaS cloud computing
services, growth in demand for upgrading and replacement of
social infrastructure systems, increased sales of ATMs in Japan
and China, and growth in our EMS business.
For the fiscal year, we forecast a ¥4.0 billion year-on-year
increase in operating income, to ¥15.0 billion, owing to rigorous
cost-reduction efforts and the benefits of business restructuring
aimed at generating stable profits under our mid-term business
plan, which should compensate for the impact of the optimization
of our treatment plan. We forecast net income of ¥7.5 billion, a
¥34.5 billion year-on-year improvement. Factors boosting net
income will be the increase in operating income, improved non-
operating income/expenses due to a decline in expenses
associated with preferred share issuances and a reduction in inter-
est-bearing debt, and a major improvement in extraordinary
income/loss stemming from a decrease in business restructuring
expenses, including declines in retirement benefit system revision
expenses and special retirement benefits, which were incurred in
the preceding year as a result of enforcing measures under the
mid-term business plan.
The above forecasts for the fiscal year ending March 31, 2012
are based on assumed exchange rates of ¥85 per U.S. dollar and
¥110 per euro.
Performance Forecasts for the Fiscal Year Ending March 31, 2012
(Billions of yen unless otherwise stated)
Operating Net Income
Net Sales Income Net Income per Share (Yen)
¥436.0 ¥15.0 ¥7.5 ¥8.45