Ricoh 2008 Annual Report Download - page 46

45 ANNUAL REPORT 2008
The investments in and advances to affiliates primarily relate to
20% to 50% owned companies. Ricoh’s equity in the underlying
net book values of the companies is approximately equal to their
individual carrying values of ¥15,608 million and ¥1,977 million
($19,770 thousand) at March 31, 2007 and 2008, 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.”
On November 30, 2007, Ricoh sold the part of shares of common
stock of SINDO RICOH CO., LTD. The gain on sale of the shares
was not material.
As a result, proportion of ownership interest of Coca-Cola West
Holdings Co., Ltd. and SINDO RICOH 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 these companies from affiliate
companies on October 1, 2006 and February 29, 2008, respectively.
Summarized financial information for all affiliates as of March 31,
2007 and 2008 and for the years ended March 31, 2006, 2007 and
2008 is as follows:
Financial Position
Thousands of
Millions of Yen U.S. Dollars
2007 2008 2008
Assets:
Current assets ¥ 63,626 ¥ 4,088 $ 40,880
Other assets 20,791 1,581 15,810
¥ 84,417 ¥ 5,669 $ 56,690
Liabilities and shareholders’ investment:
Current liabilities ¥ 10,217 ¥ 3,489 $ 34,890
Other liabilities 3,399 581 5,810
Shareholders’ investment 70,801 1,599 15,990
¥ 84,417 ¥ 5,669 $ 56,690
Operations
Thousands of
Millions of Yen U.S. Dollars
2006 2007 2008 2008
Sales ¥320,537 ¥193,753 ¥68,662 $686,620
Costs and expenses 309,164 186,199 64,013 640,130
Net income ¥ 11,373 ¥ 7,554 ¥ 4,648 $ 46,480
The significant transactions of Ricoh with these affiliates for the
years ended March 31, 2006, 2007 and 2008, and the related
account balances at March 31, 2007 and 2008 are summarized as
follows:
Thousands of
Millions of Yen U.S. Dollars
2006 2007 2008 2008
Transactions:
Sales ¥20,205 ¥16,158 ¥20,184 $201,840
Purchases 25,617 28,993 21,274 212,740
Dividend income 1,175 828 625 6,250
Unrealized profits regarding the above transactions were eliminated
in the consolidated financial statements.
Thousands of
Millions of Yen U.S. Dollars
2007 2008 2008
Account balances:
Receivables ¥ 3,541 ¥ 3,080 $ 30,800
Payables 2,611 1,930 19,300
As of March 31, 2008, consolidated retained earnings included
undistributed earnings of 20% to 50% owned companies accounted
for by the equity method in the amount of ¥45,119 million
($451,190 thousand). This amount included undistributed earnings
of ¥35,104 million of Coca-Cola West Holdings Co., Ltd. and of
¥9,487 million ($94,870 thousand) of SINDO RICOH CO., LTD. as
of the date that Ricoh ceased applying the equity method.
Proceeds from the sales of available-for-sale securities were
¥141,620 million, ¥96,087 million and ¥100,025 million
($1,000,250 thousand) for the years ended March 31, 2006, 2007
and 2008, 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, 2007 and 2008. There were no significant
realized losses of available-for-sale securities for the years ended
March 31, 2006, 2007 and 2008.
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