Ricoh 2007 Annual Report Download - page 46

45 ANNUAL REPORT 2007
The investments in and advances to affiliates primarily relate to 20% to
50% owned companies. Included in these companies is SINDO RICOH
CO., LTD., a 20.0% owned affiliate. The common stock of this company
is publicly traded. The carrying value of the investment in this company
was equal to its underlying book value and amounted to ¥12,212
million and ¥13,816 million ($117,085 thousand) as of March 31, 2006
and 2007, respectively. The quoted market value of Ricoh’s investment
in this company was ¥13,635 million ($115,551 thousand) as of March
31, 2007.
Ricoh’s equity in the underlying net book values of the other 20% to
50% owned companies is approximately equal to their individual
carrying values of ¥39,816 million and ¥1,792 million ($15,186
thousand) at March 31, 2006 and 2007, respectively.
On July 1, 2006, “Coca-Cola West Japan Co., Ltd. (former affiliate
company)” and “Kinki Coca-Cola Bottling Co., Ltd (former unrelated
company).” established a joint holding company “Coca-Cola West
Holdings Co., Ltd.” As a result, proportion of ownership interest of Coca-
Cola West Holdings Co., Ltd. by Ricoh decreased under 20% and
according to Accounting Principles Board (“APB”) Opinion No. 18
“The Equity Method of Accounting for Investments in Common stock,”
Ricoh excluded the Coca-Cola West Holdings Co., Ltd from affiliate
company on October 1, 2006. Since then, assets, liabilities and
operations of Coca-Cola West Holdings Co., Ltd. have been excluded
from the accompany consolidated financial statements.
Summarized financial information for all affiliates as of March 31,
2006 and 2007 and for the years ended March 31, 2005, 2006 and 2007
is as follows:
Financial Position
Thousands of
Millions of Yen U.S. Dollars
2006 2007 2007
Assets:
Current assets ¥112,312 ¥63,626 $539,203
Other assets 174,529 20,791 176,195
¥286,841 ¥84,417 $715,398
Liabilities and shareholders’ investment:
Current liabilities ¥ 29,084 ¥ 10,217 $ 86,585
Other liabilities 20,335 3,399 28,805
Shareholders’ investment 237,422 70,801 600,008
¥286,841 ¥ 84,417 $715,398
Operations
Thousands of
Millions of Yen U.S. Dollars
2005 2006 2007 2007
Sales ¥330,362 ¥320,537 ¥193,753 $1,641,975
Costs and expenses 315,729 309,164 186,199 1,577,958
Net income ¥ 14,633 ¥ 11,373 ¥ 7,554 $ 64,017
The significant transactions of Ricoh with these affiliates for the years
ended March 31, 2005, 2006 and 2007, and the related account
balances at March 31, 2006 and 2007 are summarized as follows:
Thousands of
Millions of Yen U.S. Dollars
2005 2006 2007 2007
Transactions:
Sales ¥19,365 ¥20,205 ¥16,158 $136,932
Purchases 27,286 25,617 28,993 245,703
Dividend income 1,154 1,175 828 7,017
Proceeds from the sales of available-for-sale securities were ¥118,120
million, ¥141,620 million and ¥96,087 million ($814,297 thousand)
for the years ended March 31, 2005, 2006 and 2007, respectively.
The realized gains on the sales of available-for-sale securities for the
year ended March 31, 2006 was ¥1,053 million. There were no
significant realized gains of available-for-sale securities for the years
ended March 31, 2005 and 2007. There were no significant realized
losses of available-for-sale securities for the years ended March 31, 2005,
2006 and 2007.
Effective October 1, 2005, UFJ Holdings, Inc. (“UFJ”) and Mitsubishi
Tokyo Financial Group, Inc. completed a merger, in which the UFJ
shares of common stock owned by the Company were exchanged for
shares of common stock of the newly merged entity, Mitsubishi UFJ
Financial Group, Inc. (“MUFG”). As a result of this merger and
common stock exchange, Ricoh recognized a gain on securities of ¥992
million between the cost of UFJ shares surrendered and the current
market value of MUFG shares in “Other, net” as other (income)
expenses on its consolidated statements of income for the year ended
March 31, 2006.
7. INVESTMENTS IN AND ADVANCES TO AFFILIATES