Ricoh 2004 Annual Report Download

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Table of contents

  • Page 1

  • Page 2
    ...Investor Relations) http://www.ricoh.com/ir/ • Environmental conservation http://www.ricoh.com/environment/index.html • Corporate social responsibility http://www.ricoh.co.jp/about/csr.html • Social contribution (Japanese only) http://www.ricoh.co.jp/kouken/ Annual Report • Management policy...

  • Page 3
    ... copiers, multifunctional and other printers, fax machines, personal computers, optical disc drives and media, and related supplies and services, as well as digital cameras and advanced electronic devices. We are rapidly building a solid presence worldwide as a provider of comprehensive document...

  • Page 4
    ... continued to be favorable in Europe. By product line, increased sales of color plain-paper copiers (PPCs) and printing systems, both core Ricoh products, compensated for decreased sales of stand-alone analog machines and optical disc drives. As a result, overseas sales went up 2.8% from that in...

  • Page 5
    ...monochrome products with color models, we placed new color multifunctional copiers and color laser printers on the market on a continuous basis to further expand our color line. As a result, we were able to greatly increase our market share of color copiers both in the United States and Europe. Also...

  • Page 6
    ... imagio Neo 752/602 series, which is a high-speed digital multifunctional copier that is easy to use, energy efficient, and environment friendly while still providing the high productivity expected in a high-speed machine. Establishing a CSR Charter The Ricoh Group promotes more effective corporate...

  • Page 7
    ... No. 1 in the 21st Century The Ricoh Group must strengthen its competitive edge by creating new customer values and developing highly efficient management if it is to continue to grow and develop. To become the world's No. 1 product engineering company, we must see potential customer needs as...

  • Page 8
    ....5 billion ($7,727 million). imagio Neo 752 series High-speed, digital multifunctional copier with an output of 75 pages per minute. The product features the best energy consumption efficiency in this class as well as high-level security guards, including an illegal copy prevention function. The...

  • Page 9
    ... easy to read text images, and in a size compressed to just one tenth of the usual volume, thanks to the addition of the new ClearWrite PDF function. Printing Systems area MFPs, laser printers, etc., and related supplies, services, related software, etc. Other Input/Output Systems area Optical disc...

  • Page 10
    .... Sales of Network System Solutions (Billions of Yen) 250 • Personal computers, servers, network systems, network-related software, application software,services,support,etc. 209.5 200 181.9 206.9 197.4 195.8 150 Performance Despite the increased sales of useware and software both in Japan...

  • Page 11
    ... devices); the area related to leasing by affiliates; and others. The R1180D series, new semiconductor products for mobile phones and other information technology devices, are in line with the demand for compact and energy-efficient equipment. The Caplio RX digital camera is another new model...

  • Page 12
    ... office machines and software flexibly on a network so that documents can be accessed easily. The highway is designed to be an open platform for network appliances and the basis for the easy operation of diverse devices and software that are linked on a network. Networked devices are like service...

  • Page 13
    ... contact with the paper. Blurred images and bleeding can be minimized. GELJET BT System: High-Speed, Laser-Quality Duplex Printing The GELJET BT system is an innovative, groundbreaking paper-feeding method. The electrostatic transfer belt system, which is used in laser printers, is optimized for...

  • Page 14
    ... and are widely disclosed to the public through various media, including websites. Based on these principles, Ricoh Group companies have independently established and managed their own rules regarding the environment according to their business type. Corporate Philosophy Love your neighbor Love...

  • Page 15
    ... the Ricoh Group Code of Conduct by revising the Ricoh Business Code of Conduct to reflect more responsible corporate activities that achieve harmony with society and the global environment together with the establishment of the Ricoh Group CSR Charter. Please refer to Ricoh's Web site for...

  • Page 16
    ...series won the Award. Hybrid QSU: Energy Saving for High-Speed Machines Hybrid QSU, which is incorporated into the imagio Neo752 series, is the industry's first hybrid heat source. Hybrid QSU is an integration of a next-generation electrical storage device; capacitor and Ricoh's quick start-up (QSU...

  • Page 17
    ... of Income 27 Consolidated Statements of Shareholders' Investment 28 Consolidated Statements of Cash Flows 29 Notes to Consolidated Financial Statements 30 Report of Independent Registered Public Accounting Firm 55 Ricoh's Global Network 56 Senior Management 57 Corporate Data 58 16

  • Page 18
    ... In terms of the domestic market, sales increased for Printing Systems such as multifunctional printers (MFPs) and laser printers. Although sales performance also became favorable for solutions business such as support services and document management, sales of optical disc decreased. As a result of...

  • Page 19
    ..., the company reduced interest-bearing debt and interest costs by reinforcing cash management systems in Japan, the United States, and Europe. In accordance with an amendment of the pension system, furthermore, certain marketable securities were contributed to the employee retirement benefit trust...

  • Page 20
    ... sales network, Ricoh has injected full effort into the retail of color PPCs and into Printing Systems that can respond to customers' changing needs for networking, coloration, and high speeding. Furthermore, we have also striven to expand sales to major accounts. Nevertheless, sales in the Americas...

  • Page 21
    ... maturity date Average pay rate Total 2005 2006 2007 2008 2009 2010 and thereafter Fair Value (Excluding capital lease obligations and SFAS ... $196,615 $3,468,548 INTEREST RATE SWAPS Notional amounts (Millions) Type of swap Average receive rate Average pay rate Total 2005 2006 Millions of yen ...

  • Page 22
    ... capital expenditures towards digital and networking equipment, such as digital plain paper copiers ("PPCs"), multi-functional printers ("MFPs") and laser printers, and manufacturing facilities to maintain or enhance competitiveness in the industry. In fiscal 2004, Ricoh also invested a significant...

  • Page 23
    ...from changes in their market prices. Marketable securities consist of a diversified pool of Japanese equity securities. Ricoh's overall investment policy is to invest in highly-liquid, low risk investments. The table provides information about contractual maturities for available-for-sale securities...

  • Page 24
    ...Ricoh Company, Ltd. and Consolidated Subsidiaries For the Years Ended March 31 1995 1996 1997 For the Year: Net sales Cost of sales Selling... Total assets Long-term indebtedness Shareholders' investment Working capital Return on sales Return on shareholders' investment ¥1,320,617 386,535 377,840 142...

  • Page 25
    1998 Millions of yen 1999 Thousands of U.S. dollars 2000 2001 2002 2003 2004 2004 ¥1,403,348 838,440 475,201 68,428 40,210 30,131 94,117 61,971 ¥1,425,999 857,423 495,029 53,054 24,555 30,655 70,469 67,456 ¥1,447,157 867,148 491,088 70,393 28,363 41,928 58,356 61,946 ¥1,538,262 924,...

  • Page 26
    ... Sheets Ricoh Company, Ltd. and Consolidated Subsidiaries March 31, 2003 and 2004 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 raw...

  • Page 27
    ...Short-term borrowings Current maturities of long-term indebtedness Trade payables- Notes Accounts...Long-Term Liabilities: Long-term indebtedness Accrued pension and severance costs Deferred income taxes 345... Accumulated other comprehensive income (loss) Treasury stock at cost; 2,303,443 shares in 2003...

  • Page 28
    ...2004 Thousands of U.S. dollars 2004 Net Sales Cost of Sales Gross profit Selling, General and Administrative Expenses Transfer to the government of the substitutional portion of Employees' Pension Fund: Settlement loss Subsidy from government Operating income Other (Income) Expenses: Interest and...

  • Page 29
    ..., 9,111,925 shares in 2003 and 5,731,150 shares in 2004 Sales of treasury stock; 269,000 shares in 2002 and 6,873 shares in 2004 Retirement of treasury stock; 7,000,000 shares in 2003 Issuance of treasury stock in exchange for subsidiary's stock; 2,010,533 shares in 2004 Ending balance - ¥ (1,083...

  • Page 30
    ... of long-term debt securities Dividend payments Payment for purchase of treasury stock Other, net Net cash provided by (used in) financing activities Effect of Exchange Rate Changes on Cash and Cash Equivalents Net Increase in Cash and Cash Equivalents Cash and Cash Equivalents at Beginning of Year...

  • Page 31
    ... group) is a world-wide supplier of office automation equipment, including copiers, facsimile machines, data processing systems, printers and related supplies. Ricoh is also well known for its state-of-the-art electronic devices, digital photographic equipment and other products. Ricoh distributes...

  • Page 32
    ... based on the average cost of each security held at the time of sale. Non-marketable equity securities owned by Ricoh primarily relate to less than 20% owned companies and are stated at cost. As discussed further in Note 5, Ricoh changed its accounting policy with respect to the recognition of...

  • Page 33
    ... the average remaining service period of active employees expected to receive benefits under the plan. The expected long-term rate of return on plan assets used for pension accounting is determined based on the historical long-term rate of return on plan assets. The discount rate is determined based...

  • Page 34
    ... - 13,328 Retirement of treasury stock Issuance of treasury stock in - - exchange for subsidiary's stock Transfer of marketable equity securities to employee retirement - - benefit trust ¥ - 75 - $ - 721 - 3,930 3,648 37,788 35,077 (s) Use of Estimates Management of the Company has made...

  • Page 35
    ...hold the lease receivables have limited recourse to Ricoh's other assets for failure of debtors to pay. Ricoh recognizes gains or losses attributable to the change in the fair value of the retained interests, which are recorded at estimated fair value and accounted for as "trading" securities. Ricoh...

  • Page 36
    ...credit losses, and components of all receivables managed...317 $210,298 The current and noncurrent security types of available-for-sale securities, and the respective cost, gross unrealized ... Current: Corporate debt securities Other Noncurrent: Equity securities Corporate debt securities Other ¥...

  • Page 37
    ... Fair value holding losses Fair value holding losses 2004: Current: Available-for-sale: Corporate debt securities Noncurrent: Available-for-sale: Equity securities $433,875 $ $433,875 $ $125,962 $ $125,962 $ 212 212 317 317 $ $ $ $ - - - - $ $ $ $ - - - - The contractual maturities of debt...

  • Page 38
    ... companies, to its employee retirement benefit trust (the "Trust") fully administered and controlled by an independent bank trustee, with no cash proceeds thereon (the "2000 Transfer"). The 2000 Transfer of the available-for-sale securities was accounted for as a sale in accordance with SFAS No.125...

  • Page 39
    ...Ricoh with these affiliates for the years ended March 31, 2002, 2003 and 2004, and the related account...2004 Transactions- Sales Purchases Dividend ...50% owned companies accounted for by ...Software Trade...software was increased for the year ended March 31, 2004 mainly due to back-office information systems...

  • Page 40
    ... for income taxes Shareholders' investment: Foreign currency translation adjustments Unrealized gains (losses) on securities Unrealized losses on derivatives Minimum pension liability adjustment Cumulative effect of accounting change ¥51,147 2,062 (582) (146) (11,760) - ¥40,721 ¥51,984 (826...

  • Page 41
    ... Property, plant and equipment Accrued pension and severance costs 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...

  • Page 42
    ...: Weighted average interest rate 2004 2003 Millions of yen 2003 2004 Thousands of U.S. dollars 2004 Borrowings, principally from banks Commercial paper The Company and certain of its subsidiaries enter into the contracts with financial institutions regarding lines of credit and overdrawing. Those...

  • Page 43
    ...insurance companies and other financial institution, 1.25% weighted average, due through 2013 Capital lease obligations (see Note 2 (j)) Total SFAS No. 133 fair value adjustment Less-Current maturities included in current liabilities Secured loans are collateralized by land, buildings and lease... 200,...

  • Page 44
    ... to exist exclusively as a corporate defined benefit pension plan. Pursuant to the new law, Ricoh received an approval of exemption from the Minister of Health, Labor and Welfare, effective January 1, 2003, from the obligation for benefits related to future employee service with respect to the...

  • Page 45
    ...31, 2002, 2003 and 2004 were as follows: 2002 2003 2004 Discount rate Rate of compensation increase Expected long-term return on plan assets 2.9% 3.2% 4.8% 3.3% 3.4% 3.6% 2.6% 3.4% 2.5% The net periodic benefit costs of the pension plans for the three years ended March 31, 2004 consisted of the...

  • Page 46
    ..., as of March 31, 2004. Ricoh's domestic benefit plan asset allocation at March 31, 2003 and 2004 are as follows: 2003 2004 Equity securities Debt securities Life insurance company general accounts Other Total The total fair value of plan assets for domestic plan as of March 31, 2004 was...

  • Page 47
    ... in net income Net unrealized gains (losses) Minimum pension liability adjustment Other comprehensive income (loss) 2004: Foreign currency translation adjustments Unrealized gains (losses) on securities: Cumulative effect of accounting change Unrealized holding gains (losses) arising during the year...

  • Page 48
    ... currency translation adjustments Unrealized gains on securities Unrealized losses on derivatives Minimum pension liability adjustment Accumulated other comprehensive income (loss) 2002: Beginning balance Cumulative effect of accounting change Change during the year Ending balance 2003: Beginning...

  • Page 49
    ... of yen 2003 - - - 742,293 Thousands of U.S. dollars 2004 2002 2004 Income before cumulative effect of accounting change applicable to common shareholders Effect of dilutive securities: Convertible bonds- 1.8%, payable in yen, due March 2002 1.5%, payable in yen, due March 2002 0.35%, payable in...

  • Page 50
    ... credit ratings. Ricoh utilizes a number of counterparties to minimize the concentration of credit risk. Foreign Exchange Risk Management Ricoh conducts business on a global basis and holds assets and liabilities denominated in foreign currencies. Ricoh enters into foreign exchange contracts...

  • Page 51
    ... securities and Investment securities Installment loans Long-term indebtedness Interest rate swap agreements, net Foreign currency contracts,... (2,735,846) 21,788 18,038 (1,394) Limitations Fair value estimates are made at a specific point in time, based on relevant market information and information...

  • Page 52
    ... of yen 2003 Thousands of U.S. dollars 2004 Ricoh's operating segments are comprised of office equipment, including copiers and related supplies, communications and information systems, and others, including optical equipment and electronic devices. The following tables present certain information...

  • Page 53
    ... expenses for corporate headquarters. Intersegment sales are not separated by operating segment because they are immaterial. Corporate assets consist primarily of cash and cash equivalents and marketable securities maintained for general corporate purposes. (b) Geographic Information Sales which are...

  • Page 54
    ... sales Consolidated Operating income- Japan The Americas Europe Other Elimination of intersegment profit Consolidated Other expenses Income before income taxes, minority interests, equity in earnings of affiliates and cumulative effect of accounting change Total assets- Japan The Americas Europe...

  • Page 55
    ... between geographic areas are made at cost plus profit. Operating income by geographic area is sales less expense related to the area's operating revenue. No single customer accounted for 10% or more of the total revenues for the periods ended as of March 31, 2002, 2003 and 2004. 19. SUPPLEMENTARY...

  • Page 56
    ... financial statements, the Company and its subsidiaries changed their accounting policy with respect to the recognition of unrealized gains and losses as realized in the statements of income on transfers of marketable equity securities to its employee retirement benefit trust. As discussed...

  • Page 57
    ... Ltd. Sales and Other Lanier de Panama, S.A. Puerto Rico Ricoh Deutschland GmbH NRG Deutschland GmbH Lanier Deutschland GmbH & Co. KG Guernsey Asia and Oceania Production China NRG Distribution Corporation Lanier Puerto Rico, Inc. United States NRG International Limited Hungary Ricoh Tohoku Co...

  • Page 58
    Senior Management As of June 25, 2004 Board of Directors President, Chief Executive Officer and Chief Operating Officer Corporate Auditors Hisaaki Koga Hideyuki Takamatsu Kohji Tomizawa Kenji Matsuishi Takehiko Wada Group Executive Officers Senior Vice Presidents Masamitsu Sakurai Deputy ...

  • Page 59
    ..., Amsterdam, Frankfurt, Paris Independent Public Accountants KPMG Transfer Agent for Common Stock Euroclear France Crédit Lyonnais Banque Nomura France The Chuo Mitsui Trust and Banking Co., Ltd. 33-1, Shiba 3-chome, Minato-ku, Tokyo 105-8574, Japan For further information and additional copies...

  • Page 60
    ..., West Caldwell, New Jersey 07006, U.S.A. Phone: +1-973-882-2000 Facsimile: +1-973-882-2506 http://www.ricoh-usa.com/ Ricoh Europe B.V. Groenelaan 3, 1186 AA, Amstelveen, The Netherlands Phone: +31-20-5474111 Facsimile: +31-20-5474154 http://www.ricoh-europe.com/ Ricoh Asia Pacific Pte. Ltd. #15...