Ricoh 2008 Annual Report Download - page 42

41 ANNUAL REPORT 2008
million ($77,880 thousand). Goodwill arising from the acquisition
of InfoPrint Solutions Company, LLC has all been allocated to the
Office Solutions segment.
Pro forma results of operations, assuming this acquisition was
made at the beginning of fiscal year 2008, have not been presented,
because the results of operations related to InfoPrint Solutions
Company, LLC were impracticable.
Furthermore, Ricoh acquired other immaterial entities during the
year ended March 31, 2008 for a consideration of ¥3,840 million
($38,400 thousand), net of cash acquired.
In January 2007, Ricoh Europe B.V., a wholly-owned subsidiary of
the Company acquired the European operations of Danka Business
Systems PLC (“Danka’s European operations”) for total cash
consideration of ¥27,132 million including direct acquisition costs.
Ricoh made the acquisition to strengthen its sales and service
network in major countries in Europe.
Ricoh applied the purchase method of accounting to account for the
acquisition and, accordingly, the purchase price has been allocated
to the tangible and intangible net assets of Danka’s European
operations. based on the estimated fair value of such net assets.
The amount of consideration paid in excess of the estimated fair
value of the net assets acquired of ¥18,658 million was recorded as
goodwill which is not tax deductible. Assets, liabilities and
operations of Danka’s European operations have been included in
the accompanying consolidated financial statements since the
acquisition date.
The following table reflects the January 31, 2007 condensed
balance sheet of Danka’s European operations., as adjusted to give
effect to the purchase method accounting adjustments:
Millions of Yen
Cash and cash equivalents ¥ 3,839
Receivables and other assets 22,385
Property and equipment 1,434
Identifiable intangible assets 4,883
Goodwill 18,658
Liabilities (24,067)
Total cash consideration ¥ 27,132
Identifiable intangible assets of Danka’s European operations
primarily comprised customer relationships of ¥4,700 million,
which were estimated to have a remaining useful life of 10 years to
18 years. Goodwill arising from the acquisition of Danka’s
European operations has all been allocated to the Office Solutions
segment.
Information pertaining to Ricoh’s lease receivables as of March 31, 2007 and 2008 is as follows:
Thousands of
Millions of Yen U.S. Dollars
2007 2008 2008
Minimum lease payments receivable ¥ 636,174 ¥ 645,198 $ 6,451,980
Estimated non-guaranteed residual value 5,000 6,358 63,580
Unearned income (52,341) (56,408) (564,080)
Allowance for doubtful receivables (12,520) (9,935) (99,350)
Lease receivables, net 576,313 585,213 5,852,130
Less - Current portion of lease receivable, net (191,529) (193,497) (1,934,970)
Amounts due after one year, net ¥ 384,784 ¥ 391,716 $ 3,917,160
Summarized selected financial information for the years ended
March 31, 2006 and 2007 for the discontinued operations
reclassified during the year ended March 31, 2007 is as follows:
4. DISCONTINUED OPERATIONS
5. FINANCE RECEIVABLES
Millions of Yen
2006 2007
Net sales ¥ 5,852 ¥ 1,487
Income from discontinued operations before gain on
disposal of discontinued operations and provision for income taxes 3,433 866
Gain on disposal of discontinued operations - 8,830
Provision for income taxes 1,398 4,196
Income from discontinued operations, net of tax ¥ 2,035 ¥ 5,500
Finance receivables as of March 31, 2007 and 2008 are comprised
primarily of lease receivables and installment loans.
Ricoh’s products are leased to domestic customers primarily through
Ricoh Leasing Company, Ltd., a majority-owned domestic subsidiary, and
to overseas customers primarily through certain overseas subsidiaries.
These leases are accounted for as sales-type leases in conformity with
SFAS 13. Sales revenue from sales-type leases is recognized at the
inception of the leases.