Toshiba 2013 Annual Report Download

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Table of contents

  • Page 1

  • Page 2
    ...are also promoting global business in retail store solutions and office equipment. Electronic Devices Segment We are driving forward storage solutions with our world-class NAND flash memory, and deploying lineups of discrete and system LSI. Social Infrastructure Segment Supporting society's safety...

  • Page 3
    ... Toshiba Group Data Section Corporate Data Power Systems Company Social Infrastructure Systems Company Toshiba Elevator and Building Systems Corporation Toshiba Solutions Corporation Toshiba Medical Systems Corporation Toshiba Consumer Electronics Holdings Corporation TOSHIBA Annual Report 2013...

  • Page 4
    ... system, the Board of Directors is expected to play the key role in supervising management. It has been 10 years this year since Toshiba has shifted to the Company with Committees governance system. Under this organization structure, management functions are separated: basic management policy-making...

  • Page 5
    ...new management team, I will do all I can to ensure that Toshiba Group will make a further leap ahead as a global corporation. I sincerely ask our shareholders for their further support and guidance. To Our Shareholders June 2013 Atsutoshi Nishida Chairman of the Board of Directors TOSHIBA Annual...

  • Page 6
    ... LCD business, consolidated operating income was ¥194.3 billion. The Electronic Devices segment also recorded a higher level of operating income, reflecting the positive effect of production adjustment for NAND flash memories and the expansion of sales of high-value-added 04 TOSHIBA Annual Report...

  • Page 7
    ... to our debt-to-equity ratio (D/E ratio), although interest-bearing liabilities increased due to the acquisition from IBM of the Retail Store Solution (RSS) business and the purchase from the Shaw Group in the U.S. of its 20% holding in Westinghouse, total shareholders' equity improved, in part due...

  • Page 8
    ... Total assets Equity attributable to shareholders of Toshiba Corporation (Note 3) Interest-bearing debt Shareholders' equity ratio (%) Debt/equity ratio (Times) Investment R&D expenditures Capital expenditures (Property, plant and equipment) Depreciation (Property, plant and equipment) Return...

  • Page 9
    ... FY08 FY09 FY10 FY11 FY12 Net income (loss) (Billions of yen) Return on sales (%) 137.8 2.2 70.1 Total equity attributable to shareholders of Toshiba Corporation (Billions of yen) Debt/equity ratio (Times) 1,034.5 77.5 1.3 4.0 797.4 868.1 863.5 1.1 53 -5.3 -343.6 FY08 FY09 FY10 FY11 FY12...

  • Page 10
    ... this plan, in addition to "Energy" and "Data Storage," which continue to be two strategic business pillars of Toshiba Group, we will turn "Healthcare" into our third business pillar. Based primarily on these three business pillars, we will aim to develop solutions to important global social issues...

  • Page 11
    ...as by making global use of shared services, and by enhancing the quality, efficiency, speed and added value of our work in all of our businesses. Our objective is to make extraordinary operational quality a key Toshiba Group competitive advantage. Third, to help uncover new needs, we need to develop...

  • Page 12
    ... business boundaries in Toshiba Group so as to allow us to make maximum use of Toshiba Group's assets and resources as we pursue new business development and support the incubation of creative ideas. This new type of organization will play a key role in such areas as product planning and marketing...

  • Page 13
    ... work to develop new approaches to patient care and health management with a focus on helping to provide better total lifetime healthcare. Moreover, presently in the Toshiba Group, various businesses related to the medical field such as carbon ion radiotherapy systems, in-vitro diagnostic equipment...

  • Page 14
    ... with each other. Toshiba Group is accepting the challenge to work toward solutions of these difficult issues by means of developing and commercializing high-efficiency, low-carbon-emission baseload power technologies that President's Perspective contribute to protecting the global environment. In...

  • Page 15
    ...our product lines Along with the impressive evolution of data storage systems, the volume of information has continued to increase explosively, and in the storage device business it is necessary to develop products that have faster speed and higher capacity. Toshiba Group is the only one company in...

  • Page 16
    ... Products & Services Group. The Community Solutions Group was formed by gathering together our Smart Community Solutions business and Buildings and Facilities business in order to unify and strengthen these business operations. In this business group, we repositioned our lighting and air conditioner...

  • Page 17
    ... Streamlined LCA (Life Cycle Assessment) Going forward, I will work to the best of my abilities to build a corporate group that is trusted as global company and is seen as an excellent corporate citizen of planet Earth. I will also constantly work to maximize Toshiba's corporate value. The ultimate...

  • Page 18
    ... Factories Power Supply Buildings Renewable Energy ICT/Cloud Storage Distribution & Retailing TV, PC, Home Appliances Multifunction printers Materials and Devices Homes Smart Community Medical services Data Storage Data Centers Servers Storage Arrays HDD/SSD/NAND *1: Home Energy Management System...

  • Page 19
    ....0 120 20% 9% 120 23% 14% FCF*1 Shareholders' equity ratio ROI*2 x 1.42 x 1.01 x 0.80 FY13-15 FY13-15 FY2012 FY2013 FY2015 *1: Free Cash Flow *2: Return On Investment = Operating income/(Shareholders' Equity + Interest-bearing Debt) *3: Debt / Equity Ratio TOSHIBA Annual Report 2013 17

  • Page 20
    ... High efficiency facility equipment : 21% Energy-saving control function (BEMS) : 11% *1 Results of Toshiba's trial calculations *2 BEMS: Building Energy Management System Retail Solutions Systems Expanding business by utilizing power of No.1 global share ¥300 billion 18 TOSHIBA Annual Report...

  • Page 21
    ... make maximum use of Toshiba Group's assets and resources New Business Development Marketing, product design and business model planning e.g.1 Infrastructure Maintenance Support for Incubation of Creative Ideas Technology, sales, manufacturing, management strategy, design, finance, human resources...

  • Page 22
    ... of net sales total prior to elimination of inter-segment sales Home Appliances Segment Toshiba Consumer Electronics Holdings Corporation Social Infrastructure Segment Power Systems Company Social Infrastructure Systems Company Toshiba Elevator and Building Systems Corporation Toshiba Solutions...

  • Page 23
    Breakdown by segment: Sales (Billions of yen) Digital Products Electronic Devices Social Infrastructure Home Appliances Others Capital Expenditures (Billions of yen) 16.8% (Order basis) 6.1% 7.8% 6,512.7 6,291.2 1,803.0 6,398.5 6,100.3 1,661.0 Share by segment 5,800.3 1,432.7 423.8 26.8 ...

  • Page 24
    ... LCD TVs recorded a loss for the second consecutive year due to further fall-off in demand despite structural reform. PCs secured profit but saw lower operating income. Toshiba TEC Corporation saw higher operating income reflecting positive effects from the acquisition of IBM's retail store solution...

  • Page 25
    ... develop new products that will meet ever diversifying user needs, and strengthen our enterprise business. *1: Lightest 13.3" wide screen LCD equipped laptop PC. Based on in-house research as of June 11, 2012. *2: When "high-speed startup mode" is selected. Fastest recorded result in seconds at time...

  • Page 26
    ... and system LSI. FY2012 Business Review / Electronic Devices Segment 21.4% FY2008 Share 19.8% of total sales Note: Ratio of net sales total prior to exclusion of inter-segment sales Sales (Billions of yen) Capital expenditures (order basis) (Billions of yen) Sales ¥1,335.3 Operating income...

  • Page 27
    ... and sells advanced semiconductor manufacturing equipment, and is closely involved in the development of related technologies. System LSI Business In FY2012 net sales declined on lower demand. However, expanding the proportion of high value-added products and carrying out structural reform secured...

  • Page 28
    ... of April 2013. *4: Based on in-house research as of June 2012. *5: As a near-line HDD product. Based on in-house research as of December 2012. *6: Based on in-house research as of September 2012. Storage Business At the start of FY2012, the balance of supply and demand in the HDD market was tight...

  • Page 29
    ...addition to supplying state-of-the-art energy solutions services, we also aim to support the safety and security of society by focusing on the Smart Community business through the provision of comprehensive technologies including power electronics, elevators, medical systems and IT services. FY2012...

  • Page 30
    ... Business Toshiba Group is working to solve global energy and environmental problems and to realize a sustainable society. We are promoting our smart community concept through "total energy innovation" that realizes a highly efficient and stable energy infrastructure, and "total storage innovation...

  • Page 31
    ... infrastructure for power grid integrating remote data management software and Landis+Gyr's smart meters. In solar power, the home system business in Japan last year received more than 40,000 orders, taking our market share from 7 to 11% (in-house research). In TOSHIBA Annual Report 2013 29

  • Page 32
    ... of existing equipment, and on total solution proposals that consider the environment, energy saving and security. FY2012 results showed higher net sales from Residential solar power system businesses in China, Macau and Malaysia, and despite falling prices, particularly in Japan, operating income...

  • Page 33
    ... company in Turkey will support our expansion in the Middle East. In Brazil a new plant commenced New storage array products operation in Sao Paulo state in March 2013. Going forward we will continue to supply the South American market with safe, cost-competitive and reliable medical equipment...

  • Page 34
    ... 012 12 9.5 Share of total sales FY2008 FY20 Business Review / Home Appliances Segment 9.6% 9. Note: Ratio of net sales total prior to exclusion of inter-segment sales Sales (Billions of yen) Capital expenditures (order basis) (Billions of yen) 21.4 Sales ¥591.5 Operating income 674.3 579...

  • Page 35
    ...heating systems, achieve high level energy efficiency and comfort. In Japan, we meet growing demand for energy-efficient and power-saving products with efficient facility management systems for commercial and industrial applications. Solutions include custom store and office air-conditioning systems...

  • Page 36
    ... electrical provider. In order to make the most of the individual technologies that are Toshiba Group's strength, and to propose them as innovative solutions, we will continue to direct our focus to integrated storage, smart communities, power electronics/EVs, renewable energy, healthcare and...

  • Page 37
    ... that delivers high speed read and write speeds. Two models have been developed, offering storage capacities of 1 terabyte (TB) and 750 gigabytes (GB). Image High-efficiency combined cycle power plant The combined cycle power generation system we will supply to Chubu Electric Power Co., Ltd...

  • Page 38
    ... & Solution Development Center (Digital Products) Center for Semiconductor Research and Development Power & Industrial Systems Research and Development Center Toshiba America Research, Inc. Major research and development bases in Japan and overseas Toshiba Research Europe Ltd. Cambridge Research...

  • Page 39
    ...Hai Precision Industry GE LG Electronics Hitachi CY08 CY09 CY10 CY11 CY12 Survey results from Patolis Source: IFI Co. (US) data External evaluations related to intellectual property and research and development Various cutting-edge Toshiba Group technologies have received a high evaluation...

  • Page 40
    ... / Employee Satisfaction Diversity Strategy Promotion Committee Human Rights Enlightenment Committee In-house Companies, Key Group Companies Chief CSR Officers Group Companies in Japan Chief CSR Officers Overseas Group companies Chief CSR Officers (As of March 31, 2013) 38 TOSHIBA Annual Report...

  • Page 41
    ... manufacturing sites, such as our semiconductors plants, to improve understanding and promote CSR across the entire supply chain with regard to labor conditions, health and safety, the environment and ethics. Minamisoma Solar Agri-Park Continued support for recovery from the Great East Japan...

  • Page 42
    ... as human resource development, environmental communication and conservation of biodiversity Target Increase eco efficiency by 1.5 times against the FY2000 level by 2015 Target Train 2000 Toshiba eco style leaders by 2015 Energy-saving diagnosis High-efficiency freezer Employee participation...

  • Page 43
    ... heating equipment" due to use of a unique twin cooling system (93W, GR-F51FXV) *2 MKxx01GRxx Series (released Oct 2011), AL13SEBxxx Series (released Jul 2012) TM1-AD (Japan release 2012/3) Energy saving No.1 (Overall energy efficiency 94%) Resource saving No.1 *2 (body weight of 94kg) (10-year...

  • Page 44
    ... community development Engagement Other information (PDF version) Environment Homepage http://www.toshiba.co.jp/env/en/ Main items featured Information and announcements Green Management Greening of Process Greening of Product Greening by Technology (PDF version) 42 TOSHIBA Annual Report 2013

  • Page 45
    ... the commercial code, in another move toward reinforcing management efficiency and transparency, we introduced the Company with Committees system, pursuant to a resolution approved by the general meeting of shareholders. Reflecting the continued expansion of Toshiba's global business, the number of...

  • Page 46
    ... scale of their operations, establish 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/governance/ governance_system.htm 44 TOSHIBA Annual Report...

  • Page 47
    ...outside director since June 2012 and currently carries out appropriate supervision of the Company's management based on her rich experience and knowledge as a top executive. [Significant concurrent positions] President, JBond Totan Securities Co., Ltd.; President, the Totan Information Technology Co...

  • Page 48
    ... shareholders, Toshiba has filed declarations naming all the four of them as independent directors, as prescribed by Article 436-2 of the Security Listing Regulations of the Tokyo Stock Exchange. Corporate Governance limit their liabilities as provided in Article 423, Paragraph 1 of the Companies...

  • Page 49
    ... whole of Japan now stands at a crossroad. The notion that global business expansion is indispensable for Toshiba to survive is recognized company-wide. In order to realize it, drastic innovations including the reform of company structure, investment in and development of new technology fields and...

  • Page 50
    ... package functions as an effective incentive to improve business performance. 1) Director's compensation Fixed compensation is paid to directors who do not concurrently hold office as an executive officer, and is based on status as a full-time or part-time director and on the duties performed. The...

  • Page 51
    ...) Name Position Company Fixed Compensation Performance-based Compensation Â¥ âˆ' Total Amount Atsutoshi Nishida Director Toshiba Corporation Â¥ 127 Â¥ 127 Corporate Governance Norio Sasaki Director Executive Officer Toshiba Corporation 6 102 âˆ' 7 115 TOSHIBA Annual Report 2013 49

  • Page 52
    ...Corporate Senior Executive Vice Presidents Hidejiro Shimomitsu Hideo Kitamura Makoto Kubo Akira Sudo Masahiko Fukakushi Kiyoshi Kobayashi Yasuharu Igarashi Toshio Masaki Hiroshi Saito Fumiaki Ushio Masaaki Oosumi Shigenori Shiga Masayasu Toyohara Hironobu Nishikori 50 TOSHIBA Annual Report 2013

  • Page 53
    ...the Audit Committee Kiyomi Saito Outside Director Member, the Audit Committee Member, the Compensation Committee Executive Officers Corporate Vice Presidents Osamu Maekawa Shigenori ...Keizo Maeda Seiichi Mori Noriaki Hashimoto Hidehito Murato (As of October 1, 2013) TOSHIBA Annual Report 2013 51

  • Page 54
    ... Div. Corporate Research & Development Center Corporate Software Engineering Center Corporate Manufacturing Engineering Center Energy & Infrastructure Group Community Solutions Group Cloud & Solutions Company Toshiba Solutions Corp. Power Systems Company Nuclear Energy Systems & Services Div...

  • Page 55
    ... & Services Group Healthcare Business Development Div. Semiconductor & Storage Products Company Discrete Semiconductor Div. Digital Products & Services Company Visual Solutions Div. Personal Solutions Div. Business Solutions Div. Ome Complex Toshiba Medical Systems Corp. • Himeji Operations...

  • Page 56
    ... Corporation • Toshiba Industrial Products Sales Corporation • Toshiba Information Equipments Co., Ltd. • Toshiba Lighting & Technology Corporation • Toshiba Logistics Corporation • Toshiba Medical Systems Corporation • Toshiba Plant Systems & Services Corporation* • Toshiba Solutions...

  • Page 57
    ..., Toshiba Corporation, Sony Corporation and Hitachi, Ltd. Toshiba TEC Corporation acquired the retail store solutions business of US-based IBM (International Business Machines Corporation). Apr. 2005 Oct. 2006 Jan. June Oct. Oct. 2010 July 2011 2009 Mar. 2012 Aug. 2012 TOSHIBA Annual Report 2013...

  • Page 58
    ... Toshiba Group's mission Toshiba Group Management Vision A set of values and targets shared throughout Toshiba Group Toshiba Brand Statement United Nations Global Compact* Responsibilities as a global enterprise * UN Global Compact: A voluntary corporate citizenship initiative concerning human...

  • Page 59
    ... Stock Information 58 60 62 63 64 65 66 67 68 Data Section 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, 2013, please refer to the "Financial Review 2013." TOSHIBA Annual Report...

  • Page 60
    ... Operating income ratio (%) Return on sales (%) Cost of sales ratio (%) Selling, general and administrative expenses ratio (%) Total Assets, Equity Attributable to Shareholders of Toshiba Corporation and Interest-bearing Debt Total assets Equity attributable to shareholders of Toshiba Corporation...

  • Page 61
    ... 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 TOSHIBA Annual...

  • Page 62
    ...,592 662,474 1,019,066 ¥5,379,319 378,474 812,160 1,190,634 ¥5,752,737 336,330 1,015,827 1,352,157 ¥6,106,732 For more information, please visit our IR website at http://www.toshiba.co.jp/about/ir/en/finance/index.htm Data Section 60 TOSHIBA Annual Report 2013

  • Page 63
    ...620 779,414 163,930 1,852,964 1,038,448 715,450 192,588 1,946,486 Equity attributable to shareholders of Toshiba Corporation Common stock Additional paid-in capital Retained earnings Accumulated other comprehensive loss Treasury stock, at cost 280,281 291,137 395,134 (517,996) (1,210) 447,346 311...

  • Page 64
    ... 23,012 14.46 5.43 Data Section shareholders of Toshiba Corporation Basic earnings (loss) per share attributable to shareholders of Toshiba Corporation (Â¥) For more information, please visit our IR website at http://www.toshiba.co.jp/about/ir/en/finance/index.htm 62 TOSHIBA Annual Report 2013

  • Page 65
    ... Interests Comprehensive Income Attributable to Shareholders of Toshiba Corporation Beginning with the fiscal year ended March 31, 2013, Toshiba Corporation adopted ASU No. 2011-05, and discloses consolidated statements of comprehensive income. Data Section TOSHIBA Annual Report 2013 63

  • Page 66
    ... costs, 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...

  • Page 67
    ... 14.7 - 2.7 - 19 17.0 9.5 4.1 16.9 (32.6) 14.5 (31.0) 411.4 (12.0) Data Section Others Net sales Share of net sales (%) Operating income (loss) Operating income ratio (%) Number of employees (Thousands) R&D expenditures Depreciation Capital expenditures Total assets TOSHIBA Annual Report 2013 65

  • Page 68
    ...50,368 193,566 98,548 341,960 - - ¥1,082,046 ¥ 2013 - 232,064 56,477 198,237 159,831 - 203,792 394,813 ¥1,245,214 For more information on corporate bonds and ratings, please visit our IR website at http://www.toshiba.co.jp/about/ir/en/stock/bond.htm Data Section 66 TOSHIBA Annual Report 2013

  • Page 69
    ...37.3 Overseas investors Financial institutions in Japan 37.3% 20 39.6 38.1 38.9 24.7% Securities companies in Japan 1.8% Companies in Japan 0 2009 2010 2011 2012 2013 3.7% Major Shareholders The Master Trust Bank of Japan, Limited (trust accounts) Japan Trustee Service Bank, Limited...

  • Page 70
    Stock 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) -Basic...

  • Page 71
    ... and beliefs based on economic, financial and competitive data currently available. Furthermore, they are subject to a number of risks and uncertainties that, without limitation, relate to economic conditions, worldwide mega-competition in the electronics business, customer demand, foreign currency...

  • Page 72
    Public Relations & Investor Relations Office Corporate Communications Division Tree use cycle mark We believe that it is important to make proactive use of domestic wood products and to grow forests, and we support the Forestry Agency's efforts to promote "tree trainer activities". Domestic timber...

  • Page 73

  • Page 74
    ... to shareholders of the Company (Note 2) âˆ'Basic âˆ'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 Â¥ 2012 6,100...

  • Page 75
    ... structure toward securing autonomous growth by creating future markets. The Group is promoting Total Energy Innovation and Total Storage Innovation to support realization of its Smart Community concept, strengthening its six focus businesses, and making steady progress in continuing to develop...

  • Page 76
    ... debt-to-equity ratio was 142%, a 1-point decrease from the end of March 2012. The Group strongly promotes capital expenditure and investments & loans. The Group sets "Shiftable funds", which enables the Company to make speedy and flexible decisions of investments in response to change of business...

  • Page 77
    ... The Retail Information Systems and the Office Equipment businesses reported higher sales due to the positive effects of the acquisition of IBM's Retail Store Solutions business. However, the Visual Products business, which includes LCD TVs, saw sales slide on a deepening decline in demand in Japan...

  • Page 78
    ... 2012 have been revised to reflect this change. Prior-period data on consolidated segment information has been reclassified to conform with the current classification, mainly due to changes of the structure of the Group's organization in the year ended March 31, 2013. 06 TOSHIBA Annual Report 2013

  • Page 79
    ... and electronics provider through promoting further evolution of innovation with deepened imagination. The Group accelerates expanding overseas business answering market needs through promoting Total Energy Innovation and Total Storage Innovation, in order to suggest innovative solutions using...

  • Page 80
    ...Products Electronic Devices Social Infrastructure Home Appliances • Acquisition of the distribution and retail store point-of-sale solutions business from IBM Corporation of the U.S. • Acquisition of shares of NuFlare Technology Inc. • Acquisition of equity in investment of Westinghouse Group...

  • Page 81
    ... year to 209.2 billion yen. TREASURY STOCK Shares held as of the closing date of last period: Shares acquired during the period: Demand for purchase of shares less than one unit from shareholders Aggregate amount of acquisition costs: Shares disposed during the period: Demand for sale of shares...

  • Page 82
    ...) Location Toshiba TEC Corporation Toshiba Plant Systems & Services Corporation Toshiba Elevator and Building Systems Corporation Toshiba Solutions Corporation Toshiba Medical Systems Corporation Toshiba Nuclear Energy Holdings (US) Inc. Toshiba Nuclear Energy Holdings (UK) Ltd. Toshiba Consumer...

  • Page 83
    ... energy and power electronics/EV, and total storage innovation, such as NAND flash memory, HDD/SSD, health care solutions, and retail solutions. In areas such as System LSIs, the Group is also restructuring and selectively allocating resources. While it is essential to allocate limited management...

  • Page 84
    ... market trends and to make capital investments in a timely manner, while thoroughly controlling flexible production that corresponds to fluctuations in market demand, adjustment of supplies and investment management. The Group promotes procurement of components from overseas in US dollars in order...

  • Page 85
    ... power distribution system business, including production, the Group plans to expand the business centered around emerging economies. (4) Business environment of the Home Appliances business The Home Appliances business faces intense competition from many companies manufacturing and selling products...

  • Page 86
    ... debt crisis, interest rate movements and fund supply and demand. Thus, changes in these factors may have an adverse effect on the Group's funding activities. The Group has also been raising funds by issuing bonds or taking loans from financial institutions. In the case the financial markets fall...

  • Page 87
    ... storage, smart communities, power electronics and EV, renewable energy, healthcare and digital fusion products. Promotion of new business is essential for implementation of the growth strategy, and as a part of this, in the year ended March 31, 2013, the Group acquired the Retail Stores Solutions...

  • Page 88
    ... by sharing intellectual property through the promotion of common platforms 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...

  • Page 89
    ... in February 2013. 9. Risks related to directors, employees, major shareholders and affiliates (1) Alliance in NAND flash memory The Group has a strategic alliance with a U.S. company, SanDisk Corporation ("SanDisk"), for the production of NAND flash memory, which includes production joint ventures...

  • Page 90
    ... social conditions The Group undertakes global business operations. Any changes in political, economic, and social conditions and policies, legal or regulatory changes and exchange rate fluctuations, in Japan or overseas, may impact market demand and the Group's business operations. The Group makes...

  • Page 91
    ... (Note 9) Marketable securities and other investments (Notes 5 and 6) Total long-term receivables and investments Property, plant and equipment (Notes 17 and 22): Land Buildings Machinery and equipment Construction in progress Less-Accumulated depreciation Total property, plant and equipment Other...

  • Page 92
    ... shares Issued: 2013 and 2012 âˆ'4,237,602,026 shares Â¥ 439,901 Additional paid-in capital 404,430 Retained earnings 635,586 Accumulated other comprehensive loss (443,919) Treasury stock, at cost: 2013âˆ'2,789,946 shares (1,542) 2012âˆ'2,636,058 shares âˆ' Total equity attributable to shareholders...

  • Page 93
    Consolidated Statements of Income Toshiba Corporation and Subsidiaries For the years ended March 31, 2013 and 2012 Millions of yen Thousands of U.S. dollars (Note 3) 2013 Sales and other income: Net sales Interest and dividends Equity in earnings of affiliates (Note 9) Other income (Notes 5, 6, ...

  • Page 94
    ... Income Toshiba Corporation and Subsidiaries For the years ended March 31, 2013 and 2012 Millions of yen Thousands of U.S. dollars (Note 3) Net income before noncontrolling interests Other comprehensive income (loss), net of tax (Note 19) Net unrealized gains and losses on securities (Note...

  • Page 95
    ... of Equity Toshiba Corporation and Subsidiaries For the years ended March 31, 2013 and 2012 Millions of yen Accumulated other comprehensive income(loss) Equity attributable to shareholders of the Company Equity attributable to noncontrolling interests Common stock Additional paid-in capital...

  • Page 96
    ... Common stock Additional paid-in capital Retained earnings Treasury stock Total equity Balance at March 31, 2012 $ 4,679,798 $ 4,267,287 $ 6,297,149 $ (6,042,330) $ Change in ownership for noncontrolling interests and others 35,224 (476,745) Dividend attributable to shareholders of the Company...

  • Page 97
    ... information Cash paid during the year forâˆ' Interest Income taxes Acquisition of IBM's Retail Store Solution business (Note 28)âˆ' Assets acquired (net of cash and cash equivalents) Liabilities assumed Noncontrolling interests assumed Account payable-nontrade for consideration for acquisition Sale...

  • Page 98
    ... Statements Toshiba Corporation and Subsidiaries March 31, 2013 1. DESCRIPTION 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...

  • Page 99
    ... are probable and the costs can be reasonably estimated, based on current law and existing technologies. Such liabilities are adjusted as further information develops or circumstances change. Costs of future obligations are not discounted to their present values. TOSHIBA Annual Report 2013 27

  • Page 100
    ... service period of employees expected to receive benefits. NET EARNINGS (LOSS) PER SHARE ATTRIBUTABLE TO SHAREHOLDERS OF THE COMPANY Basic net earnings (loss) per share attributable to shareholders of the Company ("EPS") are computed based on the weighted-average number of shares of common stock...

  • Page 101
    ... up to June 25, 2013 in accordance with ASC No.855 "Subsequent Events". RECLASSIFICATIONS Certain reclassifications to the prior year's consolidated financial statements and related footnote amounts have been made to conform to the presentation for the current year. TOSHIBA Annual Report 2013 29

  • Page 102
    ...FY2011. However, the Company continues the maintenance service of products manufactured and supplied. In accordance with ASC No.205-20 "Presentation of Financial Statements-Discontinued Operations" ("ASC No.205-20"), operating results relating to the mobile phone business are separately presented as...

  • Page 103
    ... of yen March 31, 2012 Level 1 Level 2 Level 3 Total Assets: Marketable securities: Equity securities Debt securities Derivative assets: Forward exchange contracts Total assets Liabilities: Derivative liabilities: Forward exchange contracts Interest rate swap agreements Currency swap agreements...

  • Page 104
    ... Consolidated Financial Statements Toshiba Corporation and Subsidiaries March 31, 2013 Thousands of U.S. dollars March 31, 2013 Level 1 Level 2 Level 3 Total Assets: Marketable securities: Equity securities Debt securities Derivative assets: Forward exchange contracts Currency options Total assets...

  • Page 105
    ... and losses on securities Purchases Sales Issuances Settlements Balance at end of year $ 32,628 $ 4,160 35,596 âˆ' âˆ' (32,575) 39,809 At March 31, 2013 and 2012, Level 3 assets measured at fair value on a recurring basis consisted of corporate debt securities. TOSHIBA Annual Report 2013 33

  • Page 106
    ... 2012 are as follows: Millions of yen Year ended March 31, 2013 Level 1 Â¥ âˆ' 25,886 âˆ' âˆ' 25,886 Â¥ Level 2 Level 3 166 2,411 0 7,500 10,077 Â¥ Total 166 28,297 0 7,500 35,963 Assets: Equity securities Investments in affiliates Long-lived assets held for use Component held for sale Total...

  • Page 107
    ... investments. Included in other expense are charges of ¥5,096 million ($54,213 thousand) and ¥7,411 million related to other-thantemporary impairments in the marketable and non-marketable equity securities for the years ended March 31, 2013 and 2012, respectively. TOSHIBA Annual Report 2013 35

  • Page 108
    ... for the years ended March 31, 2013 and 2012, respectively. Subsequent to the transfers, the Group retains collection and administrative responsibilities for the receivables. Servicing fees received by the Group approximate the prevailing market rate. Related servicing assets or liabilities...

  • Page 109
    ... and 2012, respectively, based on quoted 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...

  • Page 110
    ...Statements Toshiba Corporation and Subsidiaries March 31, 2013 10. GOODWILL AND OTHER INTANGIBLE ASSETS The Group tested goodwill for impairment in accordance with ASC No.350, applying a fair value based test and has concluded that there was no impairment for the years ended March 31, 2013 and 2012...

  • Page 111
    ... mainly allocated to Digital Products. Toshiba TEC Corporation ("TEC"), a consolidated subsidiary of the Company, entered into an agreement with IBM and acquired IBM's Retail Store Solutions business. Accordingly, the Company is in the process of allocating the purchase price to the assets acquired...

  • Page 112
    ...and 2012 were ¥26,978 million ($287,000 thousand) and ¥52,689 million, respectively. The aggregate annual maturities of long-term debt, as of March 31, 2013, excluding those of capital lease obligations, are as follows: Year ending March 31 Millions of yen Thousands of U.S. dollars 2014 2015 2016...

  • Page 113
    ... stock for the year ended March 31, 2012. The additional 175,295,212 shares relating to the potential conversion of the 2011 Bonds are included in the calculation of the diluted net income per share attributable to shareholders of the Company for the year ended March 31, 2012. TOSHIBA Annual Report...

  • Page 114
    ... employees each year according to the regulation of retirement benefit, length of service and conditions under which their employment terminates. The obligation for the severance indemnity benefit is provided for through accruals and funding of the defined benefit corporate pension plan. The Company...

  • Page 115
    ...,834 2013 $ 16,624,447 The components of the net periodic pension and severance cost for the years ended March 31, 2013 and 2012 are as follows: Millions of yen Year ended March 31 Thousands of U.S. dollars Service cost Interest cost on projected benefit obligation Expected return on plan assets...

  • Page 116
    ... to Consolidated Financial Statements Toshiba Corporation and Subsidiaries March 31, 2013 For the year ended March 31, 2013, the Company contributed certain marketable equity securities to employee retirement benefit trusts, with no cash proceeds thereon. The fair value of these securities at the...

  • Page 117
    ... Cash and cash equivalents Equity securities: Japanese companies Foreign companies Pooled funds Debt securities: Government bonds Municipal bonds Corporate bonds Pooled funds Other assets: Hedge funds Real estate Life insurance company general accounts Other assets Total Level 1 ¥ 54,579 138,579...

  • Page 118
    Notes to Consolidated Financial Statements Toshiba Corporation and Subsidiaries March 31, 2013 Millions of yen March 31, 2012 Cash and cash equivalents Equity securities: Japanese companies Foreign companies Pooled funds Debt securities: Government bonds Municipal bonds Corporate bonds Pooled ...

  • Page 119
    ... 37,830 308,926 Total $ 1,341,606 9,809 110,532 33,213 $ 1,495,160 $ $ Certain of the Company's subsidiaries provide certain health care and life insurance benefits to retired employees. Such benefits were not material for the years ended March 31, 2013 and 2012. TOSHIBA Annual Report 2013 47

  • Page 120
    ...Due to a decrease in demand and price declines, the Group recorded impairment loss of ¥8,684 million ($92,383 thousand) related to the property, plant and equipment, and finite-lived intangible assets of the Visual Products business for the year ended March 31, 2013. The impairment loss is included...

  • Page 121
    ... valuation allowance because of a change in judgment about the realizability of the related deferred tax assets in future years for the year ended March 31, 2013 were not significant. The amounts of adjustments for the year ended March 31, 2012 were ¥36,041 million. TOSHIBA Annual Report 2013 49

  • Page 122
    ...Consolidated Financial Statements Toshiba Corporation and Subsidiaries March 31, 2013 The Group's tax loss carryforwards for the corporate and local taxes at March 31, 2013 amounted to ¥568,297 million ($6,045,713 thousand) and ¥747,698 million ($7,954,234 thousand), respectively, the majority of...

  • Page 123
    19. EQUITY COMMON STOCK The total number of authorized shares of the Company is 10,000,000,000. The total number of shares issued for the years ended March 31,2013 and 2012 are 4,237,602,026. RETAINED EARNINGS Retained earnings at March 31, 2013 and 2012 included a legal reserve of ¥34,780 million ...

  • Page 124
    Notes to Consolidated Financial Statements Toshiba Corporation and Subsidiaries March 31, 2013 Tax effects allocated to each component of other comprehensive income (loss) for the years ended March 31, 2013 and 2012 are shown below: Millions of yen Pre-tax amount Tax benefit (expense) Net-of-tax ...

  • Page 125
    ...any large-scale acquisitions of the Company's shares (the "Plan"), based on the shareholders' approval of the Plan 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...

  • Page 126
    Notes to Consolidated Financial Statements Toshiba Corporation and Subsidiaries March 31, 2013 20. NET EARNINGS (LOSS) PER SHARE ATTRIBUTABLE TO SHAREHOLDERS OF THE COMPANY The following reconciliation table of the numerators and denominators sets forth the computation of basic and diluted net ...

  • Page 127
    ... debt to a fixed-rate basis for the next 7 years. The Group expects to reclassify ¥973 million ($10,351 thousand) of net income on derivative financial instruments from accumulated other comprehensive loss to net income (loss) attributable to shareholders of the Company during the next 12 months...

  • Page 128
    ...to Consolidated Financial Statements Toshiba Corporation and Subsidiaries March 31, 2013 The Group's forward exchange contract amounts, the aggregate notional principal amounts of interest rate swap agreements, currency swap agreements and currency options outstanding at March 31, 2013 and 2012 are...

  • Page 129
    ... those related to leasing activities. The table also excludes marketable securities and other investments which are disclosed in Note 6. In assessing the fair value of these financial instruments, the Group uses a variety of methods and assumptions, which are based on estimates of market conditions...

  • Page 130
    ...Financial Statements Toshiba Corporation and Subsidiaries March 31, 2013 The effect of derivative instruments on the consolidated statements of income for the year ended March 31, 2012...recognized Location Amount recognized Location Amount recognized Forward exchange contracts Interest rate swap...

  • Page 131
    ..., 2013 and 2012 were not significant. Minimum lease payments for the Group's capital and non-cancelable operating leases as of March 31, 2013 are as follows: Millions of yen Year ending March 31 Capital leases Operating leases Thousands of U.S. dollars Capital leases Operating leases 2014 2015 2016...

  • Page 132
    ... Statements Toshiba Corporation and Subsidiaries March 31, 2013 24. GUARANTEES GUARANTEES OF UNCONSOLIDATED AFFILIATES AND THIRD PARTY DEBT The Group guarantees debt as well as certain financial obligations of unconsolidated affiliates and third parties to support the sale of the Group's products...

  • Page 133
    ...be subject to a ruling requiring payment of amounts far exceeding its expectations. Any judgment or decision unfavorable to the Group could have a materially adverse effect on the Group's business, results of operations or financial condition. The Group's Management currently believes that there are...

  • Page 134
    ... Financial Statements Toshiba Corporation and Subsidiaries March 31, 2013 ...products or equipment with PCB which some Group's operations in Japan have retained. The Westinghouse Group, consolidated subsidiaries of the Company, is subject to federal, state and local laws and regulations relating...

  • Page 135
    ...sales force and the strong relationships developed with hospitals, university medical schools and distribution partners. Operating results of VITAL are included in the Company's consolidated statement of income from the acquisition date. These amounts are not significant. TOSHIBA Annual Report 2013...

  • Page 136
    ...solutions services, and aim to expand its global operations and to grow the Smart Community business. The Group allocated the purchase price to the assets acquired and liabilities assumed in accordance with ASC No.805. The consolidated financial statements and notes for the year ended March 31, 2012...

  • Page 137
    ... point of sale systems company that provides new value to customers, globally offering high-level products and solutions in the retail solution market which has been rapidly growing in the Americas, Europe, Japan, Asia, and worldwide. The company is in the process of allocating the purchase price to...

  • Page 138
    ... and sells advanced semiconductor manufacturing equipment and has a close relationship with the Company in development of related technologies. The Company decided to acquire additional shares in consideration of the need to extend its support to NFT in technological and management operations and...

  • Page 139
    ... ventures, the Group and SanDisk share power equally. Unconsolidated VIEs involved in Social Infrastructure are established for the purpose of developing nuclear power plants, supplying stable electric power systems, and providing electric services and equipments to electric power operators. The...

  • Page 140
    ..., Hard disk drives, 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. 68 TOSHIBA Annual Report 2013

  • Page 141
    ...included in Corporate and Eliminations of Identifiable assets, are mainly marketable securities of the Company. 3) Prior-period data for the fiscal year ended March 31, 2012 has been reclassified to conform to the current classification, mainly due to changes of the structure of the Group's internal...

  • Page 142
    Notes to Consolidated Financial Statements Toshiba Corporation and Subsidiaries March 31, 2013 GEOGRAPHIC INFORMATION Net Sales Net sales by region based on the location of the customer for the years ended March 31, 2013 and 2012 are as follows: Millions of yen Year ended March 31 Thousands of U.S....

  • Page 143
    ... of Directors and Shareholders of Toshiba Corporation We have audited the accompanying consolidated financial statements of Toshiba Corporation and subsidiaries (the "Group"), which comprise the consolidated balance sheets as of March 31, 2013 and 2012, and the related consolidated statements of...

  • Page 144
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