Pioneer 2007 Annual Report Download - page 28

Download and view the complete annual report

Please find page 28 of the 2007 Pioneer annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 74

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74

PIONEER CORPORATION27
Cash flows
Net cash provided by operating activities in fiscal 2007 was
¥16.8 billion, a decrease of ¥51.6 billion compared to fiscal
2006. Changes in operating assets and liabilities were the
primary cause for the decreased cash flows from operating
activities. Among operating assets and liabilities, accounts
payable decreased due mainly to lower production volume of
plasma displays in the fourth quarter of fiscal 2007. In addition,
accrued liabilities decreased due mainly to the payments of
accrued special retirement expenses. Decreases in non-cash
expenses, such as equity in losses of affiliated companies and
impairment losses of fixed assets, were also the cause for the
decrease. In fiscal 2006, we recorded assumption of debt
amounting to ¥25.3 billion incurred by ELDis, Inc. Because of
these factors, cash flows from operating activities decreased
despite decreased net loss.
Net cash used in investing activities was ¥16.5 billion for
fiscal 2007, a decrease of ¥13.3 billion compared to ¥29.8
billion in fiscal 2006. The decrease was mainly due to an
advance of ¥14.1 billion for the sale of land and buildings at
the Tokorozawa and Omori Plants and proceeds of ¥10.9
billion from the sale of subsidiaries in fiscal 2007, which more
than offset a substantial decline in the proceeds from sales of
securities recorded in fiscal 2006.
Net cash used in financing activities was ¥21.7 billion, a
decrease of ¥16.9 billion compared to ¥38.6 billion in fiscal
Liquidity and Capital Resources
2006. In fiscal 2007, cash was used primarily for reducing long-
term debt, short-term borrowings and the payment of divi-
dends. ¥17.0 billion cash was used for repayments of
long-term debt and short-term borrowings. Cash used in divi-
dend payments amounted to ¥1.3 billion.
As a result of these activities and the effect of changes in
exchange rates on cash and cash equivalents of overseas
subsidiaries, cash and cash equivalents decreased by ¥19.9
billion to ¥101.8 billion at the end of fiscal 2007, from ¥121.7
billion at the end of fiscal 2006.
Capital requirements
Our requirements for operating capital primarily are for the
purchase of raw materials and parts for manufacturing our
products. Also, operating expenses, including manufacturing
expenses and SGA expenses, require a substantial amount of
operating capital. Payroll and payroll-benefits, and marketing
expenses, such as those for advertising and sales promotion,
account for a significant portion of operating expenses. Our
expenditure for R&D is included in various operating expenses,
and payroll for R&D-related personnel accounts for a substan-
tial portion of R&D expenses.
We believe that our ability to generate positive operating
cash flows and liquidity discussed in the following financial
management section provides sufficient resources to fund
future operating capital requirements and capital expenditures.