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A01_東芝様AR2011_表紙.indd 2 11.8.15 5:15:55 PM

Table of contents

  • Page 1

  • Page 2
    ... manufacturer and provides a wide range of products and services on a global basis in four business domains: Digital Products, Electronic Devices, Social Infrastructure and Home Appliances. In addition to this, Toshiba Group also focuses on new business areas and business expansion. This report...

  • Page 3
    ... 40 46 48 Digital Products Segment Electronic Devices Segment Home Appliances Segment Social Infrastructure Segment Research & Development and Intellectual Property CSR Management Environmental Management Corporate Governance Directors and Executive Officers...

  • Page 4
    ... profit bases. We will also strive to greatly increase Toshiba Group's ability to respond to the challenges to society posed by the need for global environmental change. As we carry out these strategic management policies, we will further endeavor to enhance the corporate value of Toshiba Group. We...

  • Page 5
    TOSHIBA Annual Report 2011 03

  • Page 6
    ...(712.8) (151.3) Financial position and indicators Total assets Equity attributable to shareholders of Toshiba Corporation (Note 4) Interest-bearing debt Shareholders' equity ratio (%) Debt/equity ratio (Times) Investment R&D expenditures Capital expenditures (Property, plant and equipment) Return...

  • Page 7
    ... 09 10 11 07 08 09 10 11 Total equity attributable to shareholders of Toshiba Corporation (Billions of yen) Debt/equity ratio (Times) 1,108.3 1,022.3 R&D expenditures R&D/sales ratio (%) 370.3 (Billions of yen) Free cash flow (Billions of yen) 365.3 357.5 311.8 319.7 561.5 451.4 868...

  • Page 8
    ... that of the market as well as a more highly profitable business structure. I will advance our basic management policies of accelerating global business development, further speeding up the pace of innovation and assiduously promoting CSR management. I intend to make Toshiba an even stronger...

  • Page 9
    ... business. In our industrial lighting business, we consolidated overseas manufacturing bases and carried out a review of our business system in Japan. In addition, we transferred our mobile phone business to a new company through a business merger with Fujitsu Limited. In the system LSI business, we...

  • Page 10
    ... strategic management policies. The essential importance of such crucial matters as meeting the growing demand for electric power, more effectively dealing with environmental issues, advancing digitalization and networking and handling the hugely-increasing volume of information ï¬,ows remain as key...

  • Page 11
    ... aiming to achieve net sales of Â¥1.1 trillion in NAND ï¬,ash memories in FY2015. Q You are determined to make Smart Community-related businesses a new profit base. How do you expect this new business to develop in the coming years? A We will nurture Smart Community-related businesses into a new...

  • Page 12
    ... comprehensive energy-management systems and maximizing the synergistic effects of integrating technologies, products and services to create new business opportunities, we will further accelerate the global development of Smart Community-related businesses and become a leading global company in...

  • Page 13
    ... will not change, and we will continue to work to accelerate the global development of these systems. We have a long record of experience in the thermal power field, both in Japan and overseas, starting with achieving eight consecutive years in the No. 1 position in the share of orders received for...

  • Page 14
    ... April 2011, we integrated our visual products and PC businesses by incorporating them into a new in-house company organized on a regional basis with respective business units for Japan, Europe/U.S., emerging economies and China. We will carry out speedy and timely business strategies by developing...

  • Page 15
    ... at the same time, we will provide global markets with products and services that can continue to maintain the No. 1 market share in the world. I aim to make Toshiba an even stronger global contender, one with unrivalled global competitiveness. In Japan we will also make it our company's mission to...

  • Page 16
    ... LCD production line at Toshiba Mobile Display Co., Ltd. in Fukaya City, Saitama Prefecture, resumed full operation at the end of April. Providing Support toward Securing the Safety of the Nuclear Power Plants Special teams at Toshiba's Tokyo headquarters and its Isogo Nuclear Engineering Center...

  • Page 17
    TOSHIBA Annual Report 2011 effort, most of them engineers, and more than 1,200 have worked on site. We have about 400 people on site every day on a rotating basis. Beyond this, at TEPCO's request, we are developing solutions with Westinghouse Electric Company, a Toshiba group company; The Shaw ...

  • Page 18
    ... Mid- to Long-term Vision Transforming Business Structure Transform Toshiba Group into a top-level diversified electric/electronics manufacturer with strong global competitive power • Power Electronics, EV Applications Realize an environmentally friendly society by use of our core technologies...

  • Page 19
    ...-rechargeable batteries to meet demand for EVs, Smart-Grid applications Home Appliances Increase production of models for emerging economies Capex, investments & loans 1,450 1,300 R&D expenditures Shiftable corporate funds 1,070 1,100 Improved assets* Total assets of ¥700 billion for making...

  • Page 20
    ...-based products, such as LCD TVs and PCs, for a system under which teams develop multiple crossDigital Products Segment category digital products. In FY2010, Toshiba ranked fourth in global combined unit sales of LCD TVs and notebook PCs (Toshiba research). Taking advantage of this scale merit...

  • Page 21
    ... Systems Company The Social Infrastructure Systems Company merges two in-house companies and one strategic business unit, providing a base for proactive global development of the Smart Community-related business. The company integrates the power-related systems and industrial electrical systems...

  • Page 22
    ... Mobile Display Co., Ltd. Social Infrastructure Segment Power Systems Company Social Infrastructure Systems Company Toshiba Elevator and Building Systems Corporation Toshiba Solutions Corporation Toshiba Medical Systems Corporation Home Appliances Segment (As of April 1, 2011) Toshiba Consumer...

  • Page 23
    ... performance and a positive result that mainly stemmed from the continued effect of the eco-points program and a hot summer in Japan. Lighting Systems also reported a healthy performance mainly due to increased sales of LED lighting and a recovery in domestic housing and building starts. The segment...

  • Page 24
    ... billion yen (+65.4 billion yen, +3% vs. FY2009) (-8.1 billion yen vs. FY2009) Overall segment sales increased on growth in the visual products business such as for LCD TVs, and PCs. Although PCs and Retail Information Systems improved, market declines in Storage Devices (HDD, ODD) resulted in...

  • Page 25
    TOSHIBA Annual Report 2011 On April 1, 2011, the Visual Products Company, (main product: LCD TVs), and the Digital Products and Network Company (main product: notebook PCs), combined to form the Digital Products & Services Company. In the mobile phone business, we merged our operations with those ...

  • Page 26
    ... hard disk drives (HDD) and optical disk drives (ODD) add significant value to end products. In FY2010 the global notebook PC market saw growth slow. The arrival of tablet PCs sapped demand for notebook PCs, especially netbooks, and cut into sales of storage products, resulting in lower revenue and...

  • Page 27
    ...the Memory and LCD businesses were strong on increased demand for mobile products, resulting in improved segment sales. Significant operating income reflected strong performances in Semiconductors and LCDs and positive results from cost cutting. Percentage of sales Sales 1,601.7 (Billions of yen...

  • Page 28
    ... Iwate Toshiba Electronics Co., Ltd. in northeast Japan. Production resumed on April 18. The memory business, number two in global market share (April 2011; Source: Toshiba), in August 2010 led the industry in starting mass produc tion of NAND flash memories with 24-nanometer process technology, and...

  • Page 29
    ... Flat Panel Display Co., a Singapore facility for PC displays, to a Taiwanese company. Looking to the future, we broke ground for a new LCD production facility in Ishikawa Prefecture in March 2011. This will help us to channel management resources into growth areas, such as displays for mobile...

  • Page 30
    ... billion yen vs. FY2009) The Power Systems and Industrial Systems were solid but slow markets in Social Infrastructure, Solutions and Medical Systems, plus the impact of the earthquake, left year on year largely unchanged. Social Infrastructure and Medical Systems saw lower sales and operating...

  • Page 31
    ... develop highly efficient, high quality systems. We will use our overseas bases to expand business at the global level, with a focus on emerging markets, such as China, India and Southeast Asia. *As at February 2011, based on in-house research Transmission Distribution & Industrial Systems Company...

  • Page 32
    ...consume less energy and release less CO 2. In Vietnam, newly established Toshiba Industrial Products Asia Co., Ltd. started to manufacture motors in fall 2010. In Japan, we won orders for photovoltaic power generation systems for four mega solar power plants (seven projects in all). Our market share...

  • Page 33
    ...Our tri-polar research and development structure, based in Japan, the United States and Europe, will support us in contributing to global advances in medicine by providing the high quality, highly reliability medical systems and services. Toshiba Solutions Corporation From planning and consultation...

  • Page 34
    ...(+14.2 billion yen vs. FY2009) Overall sales improved due to strong sales of White Goods and Room Air-conditioners, driven by the eco-points program and a hot summer in Japan. The White Goods, Lighting Systems and Airconditioning businesses recorded a surplus as a result of increased sales and of...

  • Page 35
    ... group companies in the home appliances business, including white goods, lighting fixtures and air-conditioning. Our consumer electronics business has supported daily life with the latest technologies for 80 years, since we produced Japan's first electric washing machine in 1930. By developing...

  • Page 36
    ... capture, renewable energy- notably geothermal and solar power-LED lighting and high efficiency power devices. In the mid-term, we will support management by developing technologies that sustain major businesses, including post-NAND memories and even safer nuclear power systems, and by cultivating...

  • Page 37
    ... strategy - Industrial, governmental and academic collaboration markets. In using and managing IP, our business model is based on differentiation and licensing, and targeted on making a larger contribution to increasing operating profit. Toshiba's breakthroughs win high praise. The Japan Institute...

  • Page 38
    ...form a stable revenue base and maintain a robust financial footing in order to continue to be trusted by society. In all business activities, Toshiba Group accords the highest priority to human life, safety and compliance as an operating principle. We make sure that all our employees also share this...

  • Page 39
    ... this we communicate with them in a number of ways. Toshiba Group's primary responsibilities toward shareholders and investors are to provide timely, appropriate information and a reasonable share of profit. We seek to supply customers with safe, reliable and wor thwhile products and services, and...

  • Page 40
    ... Global Warming Green Company, Henan Province Good Governance Project 2010 Philippine Environment Partnership Program (PEPP) Seal of Approval Don Emilio Abello Energy Efficiency Award and Outstanding Energy Manager Awarded to Diagnostics Ultrasonic System Aplioâ„¢ MX (SSA-780A) Development of long...

  • Page 41
    ... news and timely updates on our websites. • CSR performance Organizational Governance, Human Rights, Labor Practices, Environment, Fair Operating Practices, Consumer Issues, Community Involvement and Development • Engagement • Other information Environmental Report/Environmental Management...

  • Page 42
    ...the Company with Committees system, pursuant to a resolution approved by the annual meeting of the shareholders. As a Company with Committees we separate functions: basic policy making and supervision of management are undertaken by the board of directors and the committees, while executive officers...

  • Page 43
    ...open company with a high level of transparency. That includes the board of directors, which encourages frank expressions of opinions. I believe that top management has a good understanding of corporate governance and compliance and that they are soundly implemented. As Toshiba develops globally, all...

  • Page 44
    ...internal control systems based on those of the parent company. The following website provides detailed information on the structure of our internal control systems. http://www.toshiba.co.jp/about/ir/en/policy/ governance_system.htm Risk Management At Toshiba, throughout our worldwide operations, we...

  • Page 45
    ... Committee on each year's audit policy and plans. It also holds semimonthly liaison meetings with the Audit Committee for pre-audit discussions and to share information on the divisions subject to audit. The Corporate Audit Division carries out on-site inspections and reports its results to the...

  • Page 46
    ...& Co., Ltd. holds Toshiba's shares in a trust for its corporate pension plan. There is no relationship to be disclosed between the Company and other entities at which outside directors concurrently hold important posts. 3) Main activities In FY2010, the Board of Directors met 13 times, and the Audit...

  • Page 47
    ... 163 38 Directors and executive officers whose total compensation exceeded 100 million yen for FY2010 Name Position Company Fixed Compensation (Millions of yen) Performance Based Compensation (Millions of yen) Total Amount (Millions of yen) Atsutoshi Nishida Director Toshiba Corporation 116...

  • Page 48
    ... Hideo Kitamura Director Executive Officers Representative Executive Officer President and Chief Executive Officer Representative Executive Officer Corporate Executive Vice President Makoto Kubo Executive Officers Corporate Executive Vice Presidents Executive Officers Corporate Senior Vice...

  • Page 49
    ... Committee Audit Committee Member Compensation Committee Member Takeo Kosugi Outside Director Nomination Committee Member Audit Committee Member Compensation Committee Member Executive Officers Corporate Vice Presidents Koji Iwama Masakazu Kakumu Yasuhiro Shimura Munehiko Tsuchiya Masazumi...

  • Page 50
    .... •Toshiba General Hospital Finance & Accounting Group •Finance & Accounting Div. •Global Financial System Div. •CSR Implementation Office •Corporate Government & External Relations Div. Digital Products Group Electronic Devices & Components Group Digital Products & Services Company...

  • Page 51
    .... •Corporate Research & Development Center •Corporate Software Engineering Center Marketing Group •Marketing Planning Div. (Overseas Offices) •Moscow •Johannesburg •Baghdad New Lighting Systems Div. Smart Community Div. •Customer Satisfaction Div. •Corporate Sales & Marketing Div...

  • Page 52
    ... • Toshiba Industrial Products Sales Corporation • Toshiba Information Equipments Co., Ltd. • Toshiba Lighting & Technology Corporation • Toshiba Logistics Corporation • Toshiba Medical Systems Corporation • Toshiba Mobile Display Technology Co., Ltd. • Toshiba Plant Systems & Services...

  • Page 53
    ... company became "Toshiba Corporation." Dec. 1989 Absorbed Nippon Atomic Industry Group Co., Ltd. June 1998 Introduced corporate executive officer system. Apr. 1999 Introduced in-house company system. July 2001 Changed registered headquarters from Kawasaki City, Kanagawa, to Minato Ward, Tokyo. Aug...

  • Page 54
    ... Forum. Toshiba joined the UN Global Compact in 2004. Toshiba Group Management Vision A set of values and targets shared throughout Toshiba Group Toshiba Group Standards of Conduct Standards of conduct to which everyone in Toshiba Group is required to adhere Toshiba Group's Corporate Philosophy...

  • Page 55
    ... Performance Long-term Debt Stock/Shareholder Information 54 56 58 58 59 60 61 62 Major indices of the Data Section have been compiled chronologically based on the fiscal years. For the details of financial information for the year ended March 31, 2011, please refer to the "Financial Review 2011...

  • Page 56
    ... Total assets Equity Attributable to Shareholders of Toshiba Corporation Interest-bearing debt Long-term debt Short-term debt Shareholders' equity ratio (%)*2 Debt/equity ratio (Times)*3 R&D, Capital Expenditures and Depreciation R&D expenditures Capital expenditures (Property, plant and equipment...

  • Page 57
    ... coverage ratio (Times) = (Operating income (loss) + Interest and dividends) / Interest expense *12 Free cash flow = Net cash provided by operating activities + Net cash used in investing activities *13 Market capitalization = Common stock price [Year-end / Yen / Close] Ã- Total issued shares 55

  • Page 58
    ... Sheets (Millions of yen) March 31 2007 2008 2009 2010 2011 ASSETS Current Assets: Cash and cash equivalents Notes and accounts receivable, trade Notes Accounts Allowance for doubtful notes and accounts Inventories Deferred tax assets Prepaid expenses and other current assets ¥ 309,312 106...

  • Page 59
    ... Report 2011 (Millions of yen) March 31 2007 2008 2009 2010 2011 LIABILITIES AND EQUITY Current Liabilities: Short-term borrowings Current portion of long-term debt Notes and accounts payable, trade Accounts payable, other and accrued expenses Accrued income and other taxes Advance payments...

  • Page 60
    ...quarter 3rd quarter (Millions of yen) 4th quarter Year ended March 31 Net sales Operating income (loss) Net income (loss) attributable to shareholders of Toshiba Corporation Basic earnings (loss) per share attributable to shareholders of Toshiba Corporation (¥) 2010 2011 ¥1,313,718 ¥1,451,366...

  • Page 61
    ..., less payments Deferred income taxes Equity in (earnings) losses of affiliates, net of dividends (Gain) loss from sales, disposal and impairment of property, plant and equipment, intangible assets and securities, net (Increase) decrease in notes and accounts receivable, trade (Increase) decrease...

  • Page 62
    Industry Segment Performance (Billions of yen) Year ended March 31 Digital Products Net sales Share of net sales (%) Operating income Operating income ratio (%) Number of employees (Thousands) R&D expenditures Depreciation Capital expenditures Total assets 2007 Change (%) ¥2,536.1 34.2 4.6 0.2 46...

  • Page 63
    ...of yen) Year ending March 31 2011 2012 2013 2014 2015 2016 and thereafter 2016 2017 and thereafter Total 2010 ¥ 190,085 207,255 182,072 226,826 34,498 270,847 - - ¥1,111,583 ¥ 2011 - 137,941 182,229 178,884 34,000 - 81,004 265,339 ¥879,397 For more information on corporate bonds and ratings...

  • Page 64
    .../Shareholder Information Common Stock Price Trends Year ended March 31 Common stock price (Yen, fiscal year) High Low Nikkei average (Yen) Number of shares issued (Millions of shares) Market capitalization (Billions of yen) Earnings per share attributable to shareholders of Toshiba Corporation (Yen...

  • Page 65
    Corporate Data TOSHIBA Annual Report 2011 As of March 31, 2011 Headquarters: Founded: Number of Employees: Fiscal Year: Authorized Number of Shares: Number of Shares Issued: Number of Shareholders: Stock Exchange Listings: ISIN: Ticker Code on the Tokyo Stock Exchange: Shareholder Registration ...

  • Page 66

  • Page 67
    TOSHIBA CORPORATION 2011 FINANCIAL REVIEW Annual Report 2011 • Financial Review

  • Page 68
    ...) attributable to shareholders of the Company (Note 2) -Basic -Diluted Cash dividends Total assets Equity attributable to shareholders of the Company Capital expenditures (Property, plant and equipment) Depreciation (Property, plant and equipment) R&D expenditures Number of employees 2011 ¥ 6,398...

  • Page 69
    .... 202 affiliates were accounted for by the equity method as of the end of March 2011. RESULTS OF OPERATIONS NET SALES AND INCOME (LOSS) Despite uncertainties stemming from fiscal austerity and financial conditions in parts of Europe, the global economy continued to recover, supported by economic...

  • Page 70
    ... of March 2011 was 125%, a 28-point improvement from the end of March 2010. Placing importance on efficiency of investment, the Group took a very active approach during the term in its capital investment in fields in which growth is expected. As a result, capital expenditure on ordering amount basis...

  • Page 71
    ... of the Group's financial position and strategic investment plans, and other factors will announce the dividend for FY2011 as soon as it is determined. RESULTS BY INDUSTRY SEGMENT Billions of yen Net Sales Year ended March 31 - Change (%) - Operating Income (loss) Change Digital Products Electronic...

  • Page 72
    ... performance and a positive result that mainly stemmed from the continued effect of the eco-points program and a hot summer in Japan. Lighting Systems also reported a healthy performance mainly due to increased sales of LED lighting and a recovery in domestic housing and building starts. The segment...

  • Page 73
    ... accounted for by the equity method. In the Digital Products segment, capital investments amounted to 23.8 billion yen for development and manufacturing for PCs, TVs and HDDs. Major projects completed by the Group in this fiscal year included building of manufacturing facilities for HDDs (located...

  • Page 74
    ... in "CAPITAL EXPENDITURE OVERVIEW". 3) The major planned new facilities and equipment upgrades in FY2011 are as follows: As of March 31, 2011 Name of Company and Office Place Business Segment Type of Facility Manufacturing facilities for semiconductors Planned Beginning Flash Forward LLC...

  • Page 75
    ... Corporation Toshiba Solutions Corporation Toshiba Medical Systems Corporation Toshiba Nuclear Energy Holdings (US) Inc. Toshiba Nuclear Energy Holdings (UK) Ltd. Toshiba Consumer Electronics Holdings Corporation Toshiba Consumer Marketing Corporation Toshiba America, Inc. Toshiba Capital (Asia...

  • Page 76
    ... Risks related to management policy (1) Strategic concentrated investment The Group makes strategic, concentrated investments in the expansion of hybrid products and services in the areas of NAND flash memories, smart communities, power electronics and EVs, recyclable energy, healthcare and digital...

  • Page 77
    ... of the Electronic Devices business The market for the Electronic Devices business is highly cyclical, depending on demand, and intensely competitive, with many companies, mainly in overseas markets, manufacturing and selling products similar to those offered by the Group. The results of this...

  • Page 78
    ... the sales volume initially expected and the actual demand for such products, or cause the business to be adversely affected by a decrease in product unit prices due to oversupply. In particular, the price for NAND flash memories, the Group's major product in this business, may undergo rapid change...

  • Page 79
    ... this, the Group is making every effort to expand this business by developing it at the global level, including in developing nations that have a high growth rate, as well as developing new products that are environmentally friendly and that contribute to energy saving, such as new lighting systems...

  • Page 80
    ... the number of qualified personnel in each area and process is limited, while demand for such personnel is increasing. As a result, the Group may fail to retain existing employees or to obtain new human resources. The Group will further reinforce educational programs for employees, toward developing...

  • Page 81
    ... and using overseas resources more efficiently in system development. 7. Risks related to laws and regulations (1) Information security The Group maintains and manages personal information obtained through business operations, as well as trade secrets regarding the Group's technology, marketing and...

  • Page 82
    ... the Group are currently pending in the United States. 9. Risks related to directors, employees, major shareholders and affiliates (1) Alliance in NAND flash memories The Group has a strategic alliance with a U.S. company, SanDisk Corporation ("SanDisk"), for the production of NAND flash memories...

  • Page 83
    ... are found worldwide. While the Group makes every effort to prevent counterfeit products, the heavy circulation of counterfeit products may dilute the value of the Toshiba brand, and the Group's net sales may be adversely affected. (2) Protection of intellectual property rights The Group makes every...

  • Page 84
    ... current assets Long-term receivables and investments: Long-term receivables (Note 7) Investments in and advances to affiliates (Note 9) Marketable securities and other investments (Note 6) Total long-term receivables and investments Property, plant and equipment (Notes 17 and 22): Land Buildings...

  • Page 85
    ..., 21, 26 and 27) Total long-term liabilities Total liabilities Equity attributable to shareholders of the Company (Notes 12 and 19): Common stock: Authorized-10,000,000,000 shares Issued: 2011 and 2010-4,237,602,026 shares Additional paid-in capital Retained earnings Accumulated other comprehensive...

  • Page 86
    Consolidated Statements of Income Toshiba Corporation and Subsidiaries For the years ended March 31, 2011 and 2010 Millions of yen Thousands of U.S. dollars (Note 3) 2011 Sales and other income: Net sales Interest and dividends Equity in earnings of affiliates (Note 9) Other income (Notes 6, 16 ...

  • Page 87
    ... Corporation and Subsidiaries For the years ended March 31, 2011 and 2010 Millions of yen Common stock Additional paidin capital Retained earnings Accumulated other comprehensive income (loss) Treasury stock Equity attributable to Equity attributable shareholders of to noncontrolling the Company...

  • Page 88
    ... taxes Equity in earnings of affiliates, net of dividends Loss from sales, disposal and impairment of property, plant and equipment and intangible assets, net Loss from sales and impairment of securities and other investments, net (Increase) decrease in notes and accounts receivable, trade Increase...

  • Page 89
    ... OF BUSINESS Toshiba Corporation ("the Company") and its subsidiaries (hereinafter collectively, "the Group") are engaged in research and development, manufacturing and sales of high-technology electronic and energy products, which range (1)Digital Products, (2)Electronic Devices, (3)Social...

  • Page 90
    ...loss is recorded based on the fair value of the asset. Fair value is determined primarily by using the anticipated cash flows discounted at a rate commensurate with the risk involved. For assets held for sale, an impairment loss is further increased by costs to sell. Long-lived assets to be disposed...

  • Page 91
    ... specific criteria of the equipment are demonstrated by the Group. Revenue from services, such as maintenance service for plant and other systems, that are priced and sold separately from the equipment is recognized ratably over the contract term or as the services are provided. Revenue on long-term...

  • Page 92
    ... contract on July 29, 2010. The purpose of this business merger was to enhance their handset development capabilities and at the same time to improve business efficiency by combining their mobile phone development know-how and technological strengths, in the domestic and overseas mobile phone market...

  • Page 93
    ...this contract, the Company will continue manufacturing and selling of the existing models of mobile phones until the first half of FY2011. In accordance with ASC No.205-20 "Presentation of Financial Statements-Discontinued Operations" ("ASC No.205-20"), operating results relating to the mobile phone...

  • Page 94
    ... measured at fair value on a recurring basis at March 31, 2011 and 2010 are as follows: Millions of yen March 31, 2011 Level 1 Level 2 Level 3 Total Assets: Marketable securities: Equity securities Debt securities Derivative assets: Forward exchange contracts Interest rate swap agreements Currency...

  • Page 95
    ...prices in active markets with sufficient volume and frequency of transactions. Level 2 securities represent marketable equity securities listed in less active markets, which are valued based on quoted market prices for identical assets in inactive markets. Level 3 securities represent corporate debt...

  • Page 96
    ... Analyses of the changes in Level 3 assets measured at fair value on a recurring basis for the years ended March 31, 2011 and 2010 are as follows: Millions of yen Year ended March 31, 2011 Marketable securities Subordinated retained interests Total Balance at beginning of year Total gains or losses...

  • Page 97
    .... The impaired long-lived assets were classified within level 3 as they were valued based on discounted cash flows expected to be generated by the related assets and on the transfer price of stocks with unobservable inputs. As a result, the net impacts for the years ended March 31, 2011 and 2010...

  • Page 98
    ... Financial Statements Toshiba Corporation and Subsidiaries March 31, 2011 6. MARKETABLE SECURITIES AND OTHER INVESTMENTS The aggregate cost, gross unrealized holding gains and losses, and aggregate fair value for marketable equity securities and debt securities classified as available-for-sale...

  • Page 99
    ... are as follows: Millions of yen Total principal amount of receivables March 31 Amount 90 days or more past due Net credit losses Year ended March 31 Accounts receivable Notes receivable Total managed portfolio Securitized receivables Total receivables 2011 2010 2011 2010 2011 2010 ¥ 1,189,602...

  • Page 100
    ... market prices at those dates. Summarized financial information of the affiliates accounted for by the equity method is shown below: Millions of yen March 31 Thousands of U.S. dollars Current assets Other assets including property, plant and equipment Total assets Current liabilities Long-term...

  • Page 101
    ... of yen March 31, 2011 Gross carrying amount Accumulated amortization Net carrying amount Other intangible assets subject to amortization: Software Technical license fees Core and current technology Other Total Other intangible assets not subject to amortization: Brand name Other Total ¥ ¥ 194...

  • Page 102
    ... 229,024 152,145 Goodwill represents the excess of the purchase price over the fair value of the net assets acquired. The changes in the carrying amount of goodwill for the years ended March 31, 2011 and 2010 are as follows: Millions of yen Year ended March 31 Thousands of U.S. dollars Balance at...

  • Page 103
    ...Bonds with stock acquisition rights: Due 2011 convertible at ¥542 per share at March 31, 2011 Euro yen medium-term notes of subsidiaries, due 2011 with interest rate of 1.31% at March 31, 2011 and due 2011 to 2014 with interest ranging from 1.31% to 1.67% at March 31, 2010 Capital lease obligations...

  • Page 104
    ...any time after the closing price of the shares on at least one trading case of the 2009 Bonds) or July 21, 2010 (in day is more than 120% of the conversion price in effect on each such trading day. the case of the 2011 Bonds) The 2011 Bonds were not converted into shares of common stock for the year...

  • Page 105
    ... employees and managements in January 2011, and introduced Cash Balance Plan from April 2011. This plan is designed that each plan participant has a notional account, which is accumulated based on salary standards, interest rates in financial markets and others. The funding policy for the plans...

  • Page 106
    ...Other changes in plan assets and benefit obligation recognized in the other comprehensive income (loss) for the years ended March 31, 2011 and 2010 are as follows: Millions of yen Year ended March 31 Thousands of U.S. dollars Current year actuarial loss Recognized actuarial loss Prior service cost...

  • Page 107
    ... policies and strategies are to assure adequate plan assets to provide for future payments of pension and severance benefits to participants, with reasonable risks. The Group designs the basic target allocation of the plan assets to mirror the best portfolio based on estimation of mid-term and long...

  • Page 108
    ... at fair value at March 31, 2011 and 2010 by asset category are as follows: Millions of yen March 31, 2011 Level 1 Level 2 Level 3 Total Cash and cash equivalents Equity securities: Japanese companies Foreign companies Pooled funds Debt securities: Government bonds Municipal bonds Corporate bonds...

  • Page 109
    ... bonds, which are valued based on quoted market prices in active markets with sufficient volume and frequency of transactions. Level 2 plan assets represent pooled funds that invest in equity securities and debt securities, corporate bonds and life insurance company general accounts. Pooled funds...

  • Page 110
    ... East Japan Earthquake of March 11, 2011 was not significant. 17. IMPAIRMENT OF LONG-LIVED ASSETS Due to general price erosion and severe market competition, the Group recorded impairment losses of ¥19,023 million ($229,193 thousand) related primarily to the manufacturing facilities of the System...

  • Page 111
    18. INCOME TAXES The Group is subject to a number of different income taxes which, in the aggregate, result in an effective statutory tax rate in Japan of approximately 40.7 percent for the years ended March 31, 2011 and 2010. A reconciliation table between the reported income tax expense and the ...

  • Page 112
    .... In other major foreign tax jurisdictions, the Group is no longer subject to regular income tax examinations by tax authorities for years before the fiscal year ended March 31, 2006 with few exceptions. 19. EQUITY COMMON STOCK The total number of authorized shares of the Company is 10,000...

  • Page 113
    ... ($1,171,783 thousand). The Company resolved, at the board of directors meeting held on May 7, 2010, the submission of the disposition of the Company's other capital surplus based on Article 452 of the Corporation Law of Japan. As a result, the additional paid-in capital was reduced by ¥46,772...

  • Page 114
    ...yen Pre-tax amount Tax benefit (expense) Net-of-tax amount For the year ended March 31, 2011: Net unrealized gains and losses on securities: Unrealized holding losses arising during year Less: reclassification adjustment for losses included in net income attributable to shareholders of the Company...

  • Page 115
    ...for the purpose of protection and enhancement of the corporate value of the Company and the common interests of shareholders. Specifically, if an acquirer commences or plans to commence an acquisition or a tender offer that would result in the acquirer holding 20% or more of the shares issued by the...

  • Page 116
    ... (loss) attributable to shareholders of the Company ¥ ¥ Thousands of shares Year ended March 31 2011 4,235,297 175,295 4,410,592 Yen 2010 4,004,801 - 4,004,801 U.S. dollars Weighted-average number of shares of common stock outstanding for the year Incremental shares from assumed conversions...

  • Page 117
    ... currencies and the payments of accounts payable denominated in foreign currencies and variable interest associated with the floating-rate debts. Derivatives Not Designated as Hedging Instruments Strategy The Group has entered into certain forward exchange contracts, interest rate swap agreements...

  • Page 118
    ... are summarized as follows: Millions of yen March 31 Location Thousands of U.S. dollars 2011 2010 2011 Derivatives designated as hedging instruments: Assets: Forward exchange contracts Prepaid expenses and other current assets Interest rate swap agreements Currency swap agreements Liabilities...

  • Page 119
    ... fair value of these financial instruments, the Group uses a variety of methods and assumptions, which are based on estimates of market conditions and risks existing at that time. For certain instruments, including cash and cash equivalents, notes and accounts receivable-trade, short-term borrowings...

  • Page 120
    ... Derivatives not designated as hedging instruments: Millions of yen Amount of gain (loss) recognized in income (loss) Location Amount recognized Forward exchange contracts Currency options Other income Other expense ¥ 1,676 (162) 22. LEASES The Group leases manufacturing equipment, office and...

  • Page 121
    ... policy. RESIDUAL VALUE GUARANTEES UNDER SALE AND LEASEBACK TRANSACTIONS The Group has entered into several sale and leaseback transactions in which certain manufacturing equipment was sold and leased back. The Group may be required to make payments for residual value guarantees in connection...

  • Page 122
    Notes to Consolidated Financial Statements Toshiba Corporation and Subsidiaries March 31, 2011 WARRANTY Estimated warranty costs are accrued for at the time a product is sold to a customer. Estimates for warranty costs are made based primarily on historical warranty claim experience. The following ...

  • Page 123
    ... Ltd. and Sumitomo Electric Industries, Ltd. with the intention of expanding the Group's Nuclear Power Systems business by establishing a market presence in Japan and building a fuel production platform in Asia. The Group allocated the purchase price to the assets acquired and liabilities assumed in...

  • Page 124
    ...purchase price and the fair values of noncontrolling interests to the identifiable assets acquired and liabilities assumed as of the acquisition date: As of the acquisition date Millions of yen Thousands of U.S. dollars Purchase price Noncontrolling interests Total Current assets Non-current assets...

  • Page 125
    .... Unconsolidated VIEs involved in Electronic Devices are joint ventures established with SanDisk Corporation ("SanDisk") for the purpose of strengthening the production of NAND flash memories. For those joint ventures, the Group and SanDisk have an equally sharing power. Unconsolidated VIEs involved...

  • Page 126
    ...crystal displays, etc. (3) Social Infrastructure: Energy-related equipment, Medical equipment, IT solutions, Elevators, etc. (4) Home Appliances: Refrigerators, Washing drying machines, Light fixtures, Air-conditioners, etc. (5) Others: Logistics Service, etc. BUSINESS SEGMENTS Financial information...

  • Page 127
    ... (20,443) ¥ (7,667) ¥ As of and for the year ended March 31, 2011 Thousands of U.S. dollars Digital Products Net sales (1) Unaffiliated customers (2) Intersegment Total Identifiable assets Depreciation and amortization Capital expenditures Segment operating income (loss) $ $ 26,853,194 1,202...

  • Page 128
    ... Corporation and Subsidiaries March 31, 2011 GEOGRAPHIC INFORMATION Net Sales Net sales by region based on the location of the customer for the years ended March 31, 2011 and 2010 are as follows: Millions of yen Year ended March 31 Thousands of U.S. dollars Japan Overseas Asia North America Europe...

  • Page 129
    Report of Independent Auditors The Board of Directors and Shareholders of Toshiba Corporation We have audited the accompanying consolidated balance sheets of Toshiba Corporation and subsidiaries (the "Group") as of March 31, 2011 and 2010, and the related consolidated statements of income, equity, ...

  • Page 130
    This report was printed on recycled paper with soy-based ink. Printed in Japan