Ricoh 1999 Annual Report Download

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A
DDING
C
OLORTO
Y
OUR
W
ORLD
A NNUAL R EPORT 1 9 9 9

Table of contents

  • Page 1
    AN N UAL REPORT 1999 ADDING COLOR TO Y OUR WORLD

  • Page 2
    ... Our lineup includes copiers, printers, fax machines, personal computers, and related supplies. We are also prominent in digital and conventional cameras, CDRecordable and CD-ReWritable drives and media, and advanced electronic devices. Through Image Communication, our corporate slogan that embodies...

  • Page 3
    ... COVERAGE Highly productive equipment should be available to users in all business environments- corporate, mobile, and home offices. Product manufacturer Dealer Reuse of products Private reuse User M aintenance company Pr ivate r ecycling machine Produ recyc cent Recovery center Recycling...

  • Page 4
    F INANCIAL HIGHLIGHTS Ricoh Company, Ltd., and Consolidated Subsidiaries For the Years Ended March 31, 1998 and 1999 1998 Millions of yen Thousands of U.S. dollars % change 1999/ 1998 1999 1999 For the Year: Net sales Domestic Overseas Net income ¥ 1,403,348 831,339 572,009 30,131 ¥ 1,425...

  • Page 5
    ...products-particularly multifunctional digital copiers and printers-can clearly contribute to office efficiency and productivity. More about that later. Overseas, conditions were tough throughout Asia. That is not surprising. We did extremely well in Europe and the United States, however, building on...

  • Page 6
    ... networked. In Japan, Ricoh now offers a full regiment of color and monochrome laser printers, as well as inkjet machines. We are pleased to report that all these products were instant hits. We also brought out an exciting new line of color digital copiers domestically and internationally...

  • Page 7
    ...to expand our operational scope and establish high-return models. In the core copiers and supplies area, we will improve our cash position to allocate resources to new growth areas like printers and solutions. 2. Pursue global, yet locally focused, expansion by setting up the best sales channels in...

  • Page 8
    ... business processes, trim inventories, shorten lead times, and slash costs. These efforts will build on the Ricoh Product Development System, an ongoing cost-cutting program introduced several years ago. We will also establish a new supply chain that encompasses procurement, production, and sales...

  • Page 9
    ... in digital monochrome copiers in Europe and the United States. These achievements complement Ricoh's primacy in the Japanese market. T his special section of the annual report highlights some of the myriad ways Ricoh-through Aficio-is working to ensure that it remains the best in its industry. 8 6

  • Page 10
    ... w ➣ ➣ C Co o lo lo rr ➣ W it h t h e d o m e s t ic la u n c h o f a n e w p r in t e r r a n g e in f is c a l 1 9 9 9 , R ic o h n o w b o a s t s a b a la n c e d lin e u p o f o f f ic e o u t p u t s y s t e m s f e a t u r in g b o t h c o p ie r s a n d p r in t e r s -p o s it io...

  • Page 11
    ... engine can now be used to power a host of multifunctional capabilities, from copying to printing and faxing. The bottom line for offices is that they can reliably save space and money. Speed is another key consideration. There is nothing worse than waiting what seems like hours to do a simple copy...

  • Page 12
    ... y of Aficio series models sold t hroughout t he region and develops driver soft ware. s e a m le s s p h o t o c o n d u c t o r b e lt a n d m id - t r a n s f e r b e lt . T h is d ir e c t r o u t e s e e m s o b v io u s . B u t it h a s b e e n t h e H o ly G r a il o f o f f ic e e q u ip...

  • Page 13
    ... The plan stresses progress in four areas: 1. Environmental management systems 2. Resource conservation and recycling 3. Energy saving 4. Pollution prevention Ricoh has used its environmental management system to help all major Group companies earn certification under ISO 14001, the global standard...

  • Page 14
    ... of parts Recycled materials user Closed loop materials recycling M aterials recycling company Open loop materials recycling Oil recovery • M etals recycling company Smelting company M etals User M aintenance company Pr ivate r ecycling machine Product recycling center Parts recycling center...

  • Page 15
    ... Kong headquarters of CATHAY P ACIFIC AIRWAYS LIMITED bought more than 30 units of the Aficio 650 because of the machine's 65-cpm output and stapling, sorting, and other convenient finishing functions. 1 OPERATI ON S C E EQUI P M E N T FISCAL 1999 P ERFORMANCE In fiscal 1999, copier sales rose...

  • Page 16
    ...cpm in color mode, SEIKO INSTRUMENTS USA INC. uses the sixcolor-cpm, networkable Aficio Color 5106 heavily to output advertising and other artwork. Pictured is Greg Roper, marketing communications specialist. The Brussels office of VOLKSWAGEN B RUXELLESBRUSSEL NV-SA has bought several Ricoh copiers...

  • Page 17
    ... hard. In analog copiers, we stepped up environmental protection efforts in Japan by bringing out more remanufactured models incorporating up to 60% recycled parts. Complementing our copiers are high-resolution, wide-format copiers and stencil duplicators, many of which are digital and networkable...

  • Page 18
    ... P ARTS CENTRE warehouses more than 160,000 service parts for Ricoh machines, and ships to more than 1,000 locations in Europe in as little as four hours after receiving orders. The Aficio Color 5206 's ability to produce topquality images quickly and at low cost prompted the SPANISH NATIONAL...

  • Page 19
    ..., a compact, computer-connective plain-paper model for small work groups. T he FAX4800L was similarly successful. This machine can be upgraded to the G4 protocol. It also features an Internet connection option to streamline communications. In Japan, we reinforced our line of Super G3 models. They...

  • Page 20
    ... printers and scanners domestiThe JACKSONVILLE JAGUARS, LTD., a National Football League team, tackles its communications easily with the FAX 2000L, a compact machine with Super G3 transmission speed. Pictured is William Houston, account executive, Corporate Sponsorship. The IPSiO Color 5000 laser...

  • Page 21
    ... MP7040 series of compact CD-R/ RW drives. They write at quadruple speed and read out at SALES OF OTHER B USINESSES 20-times speed. ELECTRONIC DEVICES 200 154.2 171.2 179.4 191.5 189.9 Ricoh develops and manufactures electronic devices, crucial to innovating image processing systems. We create...

  • Page 22
    ... input devices. During the year, we introduced the RICOH DC-4 series (RDC-4300/ 4200 overseas). This camera features a 3X optical zoom lens and a resolution of 1,320,000 pixels. Our advanced 35mm compact camera range includes the GR1S and the GR10, for which demand is high in Japan and abroad...

  • Page 23
    ..., sales of copiers and related supplies rose 1.8%. This business benefited from a stronger sales structure overseas and favorable conditions in the European and U.S. markets, which offset stagnant conditions in Japan. Communications and information systems sales advanced 1.6%. New networkable...

  • Page 24
    ..., sales of copiers and related supplies rose 1.8%. This business benefited from a stronger sales structure overseas and favorable conditions in the European and U.S. markets, which offset stagnant conditions in Japan. Communications and information systems sales advanced 1.6%. New networkable...

  • Page 25
    ... 2.1% 6.4% 1.27 1.34 6.8 1.71 6.4 1.42 7.8 SALES BY P RODUCT LINE 1998 Millions of yen Percentage of net sales Millions of yen 1999 Percentage of net sales Thousands of U.S. dollars Office Equipment: Copiers and related supplies Communications and information systems ¥ 891,043 63.5% 23.0 13...

  • Page 26
    INDUSTRY SEGMENT INFORMATION BASED ON JAPANESE DISCLOSURE STANDARDS Millions of yen 1998 1999 Thousands of U.S. dollars 1999 Net Sales Office Equipment: Unaffiliated Customers Intersegment Total Other Businesses: Unaffiliated Customers Intersegment Total Eliminations Consolidated ¥ 1,213,468 - 1,...

  • Page 27
    ...1999 1999 Net Sales Japan Unaffiliated Customers Intersegment Total The Americas Unaffiliated Customers Intersegment Total Europe... Operating Income Japan The Americas Europe Other Corporate and Eliminations Consolidated ¥ ¥ ¥ $ Identifiable Assets Japan The Americas Europe Other Corporate ...

  • Page 28
    ... products through sales companies. Changes to avoid Y2K problems are almost complete. Ricoh aims to finish work on other offerings by the end of September 1999. The Company has publicized its Y2K information and relevant contact details at the following website: http:/ / www.ricoh.co.jp/ year2000...

  • Page 29
    ...Lease Obligations) Average interest rate Total 2000 2001 Millions of yen Expected maturity date 2002 2003 2004 2005 and thereafter Convertible Bonds Bonds Medium-Term Notes... date Average receive rate Average pay rate 2005 and thereafter INTEREST RATE SWAPS Notional amounts (Millions) Type of ...

  • Page 30
    ... supplied its sales companies and dealers are almost all Y2K-compliant. After installing new versions of Ricoh-provided software, all will be ready. It is difficult to accurately estimate Y2K-related costs because the readiness effort has been both internal and external. The parent company and main...

  • Page 31
    ... assets Long-term indebtedness Shareholders' investment Working capital Return on sales Return on shareholders' investment ¥ 831,627 86,147 347,041 183,008 1.9 % 4.8 ¥ 1,198,717 246,853 362,988 114,809 1.4 % 3.8 Common Stock Price Range (in yen and dollars): High Low ¥ 1,360 1,010 ¥ 1,340 671...

  • Page 32
    ...1994 1995 1996 1997 1998 Thousands of U.S. dollars 1999 1999 ¥ 1,017,417 677,674 328,522 10,...,592 349,945 116,108 1.0 % 2.7 ¥ 1,320,617 386,535 377,840 142,021 1.8 % 5.1 ¥ 1,508,519 411,023 401,471 139,163 2.0 % 5.6 ¥ 1,644,896 386,918 422,923 77,527 2.2 % 7.0 ¥ 1,660,496 295,536 475,005...

  • Page 33
    ... BALANCE SHEETS Ricoh Company, Ltd. and Consolidated Subsidiaries March 31, 1998 and 1999 ASSETS Current Assets: Cash and cash equivalents Time deposits Marketable securities Trade receivables- Notes Accounts Less-Allowance for doubtful receivables Inventories- Finished goods Work in process and...

  • Page 34
    ...Trade payables- Notes Accounts Accrued income taxes Accrued expenses and other Total current liabilities ¥ Millions of yen 1998 Thousands of U.S. dollars 1999 1999...364 311,223 Commitments and Contingent Liabilities (Note 16) Shareholders' Investment: Common stock, par value ¥50 per share: ...

  • Page 35
    C ONSOLIDATED STATEM ENTS OF I NCOM E Ricoh Company, Ltd. and Consolidated Subsidiaries For the Years Ended March 31, 1997, 1998 and 1999 1997 Millions of yen 1998 Thousands of U.S. dollars 1999 1999 Net Sales Cost of Sales Gross profit ¥ 1,316,072 772,238 543,834 460,471 83,363 ¥ 1,403...

  • Page 36
    C ONSOLIDATED STATEM ENTS OF SHAREHOLDERS' I NVESTM ENT Ricoh Company, Ltd. and Consolidated Subsidiaries For the Years Ended March 31, 1997, 1998 and 1999 1997 Millions of yen 1998 Thousands of U.S. dollars 1999 1999 Common Stock: Beginning balance Conversion of convertible bonds; 4,888,423 ...

  • Page 37
    C ONSOLIDATED STATEM ENTS OF CASH FLOW S Ricoh Company, Ltd. and Consolidated Subsidiaries For the Years Ended March 31, 1997, 1998 and 1999 1997 Millions of yen 1998 Thousands of U.S. dollars 1999 1999 Cash Flows from Operating Activities: Net income Adjustments to reconcile net income to ...

  • Page 38
    ... in 1936, and is headquartered in Tokyo, Japan. The Company and significant subsidiaries ("Ricoh" as a consolidated group) is a worldwide supplier of office automation equipment, including copiers, facsimile machines, data processing systems, printers, and related supplies. Ricoh is also well known...

  • Page 39
    ... April 1, 1999, it requires Ricoh to capitalize the costs of computer software for internal use if certain criteria are met. Previously, Ricoh expensed all such costs. (m) Accounting for Stock Splits The stock splits of common stock made at various times have been accounted for by transferring an...

  • Page 40
    ...in Japan. 4. FINANCE RECEIVABLES Finance receivables as of March 31, 1998 and 1999 are comprised of lease receivables and installment loans. The Company's products are leased to customers primarily through Ricoh Leasing Company, Ltd., a major subsidiary. These leases are accounted for as sales-type...

  • Page 41
    ... as of March 31, 1998 and 1999 primarily relate to less than 20%-owned companies and are stated at cost. The current and noncurrent security types of available-for-sale securities, and the respective cost, gross unrealized holding gains, gross unrealized holding losses and fair value as of March...

  • Page 42
    ...Ricoh Elemex Corporation, a 44.8%-owned major affiliate of which common stock is publicly traded, became a consolidated subsidiary as a result of it being merged with a consolidated subsidiary...$1,486,851 Operations 1997 Millions of yen 1998 Thousands of U.S. dollars 1999 1999 Sales Costs and ...

  • Page 43
    ...611 (28,901) $202,934 1997 Millions of yen 1998 Thousands of U.S. dollars 1999 1999 Provision for income taxes Shareholders' investment: Net unrealized holding gains on available-for-sale securities Pension liability adjustment Translation adjustments ¥ 39,864 (10,935) (2,583) 727 ¥ 27,073...

  • Page 44
    ... Deferred charges Estimated retirement allowances Net operating losses carryforward Other Less-Valuation allowance Liabilities: Sales-type leases Undistributed earnings of foreign subsidiaries and affiliates Net unrealized holding gains on available-for-sale securities Other Net deferred tax assets...

  • Page 45
    ...992 trade notes receivable discounted and/ or long-term loans; however, there are no formal compensating balance agreements with any banks. The weighted average interest rate on these time deposits was 0.2% as of March 31, 1999. The Company and certain of its subsidiaries had unused lines of credit...

  • Page 46
    ...10. PENSION AND RETIREMENT ALLOWANCES PLANS The Company and certain of its subsidiaries have various trusteed noncontributory employees pension fund ("EPF") plans covering substantially all of their employees. Under the plans, employees are entitled to lump-sum payments at the time of termination or...

  • Page 47
    ... - 9.0% The discount rate, rate of increase in compensation and expected long-term rate of return on plan assets of domestic pension plans are 3.75%, 3.7% and 3.75%, respectively, for the year ended March 31, 1998, and 3.5%, 3.7% and 3.5%, respectively, for the year ended March 31, 1999. The other...

  • Page 48
    ... Company was required to record an additional minimum pension liability at March 31, 1998 and 1999. This amount represents the excess of the accumulated benefit obligations over the fair value of plan assets. This excess is primarily attributable to a substantial reduction in the discount rate used...

  • Page 49
    ... yen Tax expense Before-tax amount Net-of-tax amount 1997: Foreign currency translation adjustments Unrealized holding gains arising during the year Minimum pension liability adjustment Other comprehensive income (loss) 1998: Foreign currency translation adjustments Unrealized gain on securities...

  • Page 50
    ... Unrealized gains on securities Minimum pension liability adjustment Accumulated other comprehensive ...14,336) (4,509) ¥ (18,845) ¥ (11,658) (10,650) ¥ (22,308) Thousands of U.S. dollars 1999: Beginning balance Change during the year Ending balance $ (84,215) (18,322) $ (102,537) $ 106,347 (32...

  • Page 51
    ...used for the computation. Thousands of shares 1998 1997 1999 Average common shares outstanding Effect of dilutive securities: Convertible bonds... Company and certain of its subsidiaries have used interest rate swap agreements as a means of managing its interest exposure; at March 31, 1998 and 1999,...

  • Page 52
    ... ¥46,307 million ($382,702 thousand) in fiscal 1999, under operating lease agreements for office space and machinery and equipment, which are primarily cancelable and renewable. At March 31, 1999, the Company and certain of its subsidiaries were parties to litigation involving routine matters, such...

  • Page 53
    ... Ricoh's industry segments are comprised of office equipment, including copiers and related supplies, communications and information systems, and others, including optical equipment and electronic devices. The office equipment segment accounted for 86% in fiscal 1997 and 1998, and 87% in fiscal 1999...

  • Page 54
    ... statements referred to above present fairly, in all material respects, the financial position of Ricoh Company, Ltd. and its consolidated subsidiaries as of March 31, 1998 and 1999, and the results of their operations and their cash flows for each of the three years in the period ended March...

  • Page 55
    ...NRG Belgium S.A. Gestetner Colombia S.A. Denmark Mexico Gestetner A/S Ricoh Mexicana, S.A. de C.V. France Peru Gestetner S.A. Puerto Rico NRG Distribution Corporation United States Germany Ricoh France S.A. Gestetner S.A. NRG France S.A. Rex-Rotary S.A. Ricoh Deutschland GmbH NRG Office System...

  • Page 56
    ... Electronic Technology Ltd. (Shanghai) Ricoh Electronic Technology Ltd. (Beijing) Hong Kong Ricoh Polska Sp.zo.o. Russia Mitsui-Ricoh CIS Ltd. South Africa Gestetner (Proprietary) Limited Spain Ricoh España S.A. NRG Comunicaciones S.A. Sweden Ricoh Hong Kong Ltd. Ricoh Asia Industry Ltd. Ricoh...

  • Page 57
    .... Ricoh Industrie France S.A. Taiwan Ricoh Co., Ltd. Ricoh Asia Industry (Shenzhen) Ltd. Ricoh Corporation Ricoh Europe B.V. Ricoh Deutschland GmbH Ricoh UK Ltd. Gestetner Holdings PLC Ricoh España S.A. Ricoh France S.A. Ricoh Italia S.p.A. Ricoh Hong Kong Ltd. Ricoh Asia Industry Ltd. Ricoh Photo...

  • Page 58
    ...Stock Listings Tokyo, Osaka, Nagoya, Fukuoka, Sapporo, Hiroshima, Niigata, Kyoto, Amsterdam, Frankfurt, Paris Independent Public Accountants Arthur Andersen Transfer Agent for Common Stock The Chuo Trust and Banking Co., Ltd. 7-1, Kyobashi 1-chome, Chuo-ku, Tokyo 104-0031, Japan Depositary and Agent...

  • Page 59
    ...-882-2506 Website: http:/ / www.ricoh-usa.com/ RICOH EUROPE B.V. Groenelaan 3, P.O. Box 114, 1186 AA Amstelveen, Netherlands Tel: (31) 20-5474111 Fax: (31) 20-5474154 Website: http:/ / www.ricoh-europe.com/ RICOH ASIA PACIFIC P TE. LTD. #15-01/ 02 The Heeren, 260 Orchard Road, Singapore 238855 Tel...