Pioneer 2009 Annual Report Download - page 21

Annual Report 2009 19
FINANCIAL REVIEW
Year ended March 31, 2009,
compared with year ended March 31, 2008
Management’s Discussion and Analysis of Financial Position,
Results of Operations and Cash Flows
Significant Accounting Policies and Estimates
Effective from fiscal 2009, the year ended March 31, 2009,
Pioneer has changed its accounting principles for preparing
consolidated financial statements from U.S. generally
accepted accounting principles (GAAP) to Japanese GAAP.
Figures for fiscal 2008 have been reclassified based on
Japanese GAAP accordingly.
Details of significant accounting policies and estimates are
shown in the Notes to Consolidated Financial Statements.
Financial Position
Total assets as of March 31, 2009 were ¥429.1 billion, a
decrease of ¥133.2 billion from March 31, 2008. This mainly
reflected decreases in trade receivables, inventories, deferred
tax assets, and investment securities. Trade receivables
decreased ¥34.5 billion to ¥61.0 billion, mainly due to lower
sales. Inventories declined ¥20.0 billion to ¥84.9 billion, mainly
due to production cutbacks centered on plasma displays and
car audio products in response to lower sales. Current and
noncurrent deferred tax assets decreased ¥22.8 billion to
¥19.6 billion, mainly in line with an increase in the valuation
allowance. Meanwhile, investment securities declined ¥16.9
billion to ¥19.0 billion, mainly due to falling prices of shares
held by the Company.
Total liabilities as of March 31, 2009 were ¥317.2 billion, up
¥14.3 billion from March 31, 2008. This mainly reflected an
increase of ¥95.2 billion in short-term borrowings, and
decreases of ¥45.4 billion and ¥16.5 billion in trade payables,
and accrued expenses, respectively.
Total equity was ¥111.8 billion, a decrease of ¥147.5 billion
from March 31, 2008. This mainly reflected a decrease of
¥131.1 billion in retained earnings. Another factor was a decline
of ¥13.9 billion in foreign currency translation adjustments from
March 31, 2008, due to the impact of the yen’s appreciation.
Results of Operations
Operating revenue
In fiscal 2009, consolidated operating revenue decreased
27.8% year on year to ¥558.8 billion. This was mainly the
result of a decline in sales of car audio products, plasma
displays and DVD drives, which largely reflected the sharp
deterioration in consumer spending worldwide in the wake of
the U.S. financial crisis as well as the impact of the Japanese
yen’s appreciation.
Car Electronics operating revenue decreased 22.0% year on
year to ¥291.7 billion because of lower sales of both car audio
products and car navigation systems, partly due to lackluster
auto sales worldwide. In car navigation systems, consumer-
market sales declined year on year, mainly due to lower sales
in North America, Japan and Europe. Meanwhile, OEM sales
rose on the back of higher sales in Japan and China, despite
lower sales in North America. In car audio products, consumer-
market sales decreased, mainly because of lower overseas
sales. OEM sales also decreased due to lower sales in Japan
and North America. Total OEM sales in this segment accounted
for approximately 41% of Car Electronics operating revenue in
fiscal 2009, compared with approximately 39% in fiscal 2008.
In terms of geographic operating revenue, operating revenue in
Japan decreased 9.8% to ¥114.0 billion, mainly due to
declines in consumer- market sales of car navigation systems
and OEM sales of car audio products, despite higher OEM
sales of car navigation systems in Japan. Overseas operating
revenue declined 28.2% to ¥177.7 billion, mainly due to weak
car audio product sales.