Wacom 2005 Annual Report Download

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ANNUAL REPO RT 2005
The harmonious development between man and technology

Table of contents

  • Page 1
    AN N UAL REPO RT 2 0 0 5 The harmonious development between man and technology

  • Page 2
    ... medical firms, transportation/shipping companies, and a host of other enterprises for which entering information via keyboards is impractical. Furthermore, by incorporating pen-sensor components into Tablet PCs, we've made it possible for mobile users such as delivery truck drivers to enter...

  • Page 3
    ... of online audio and video products. In addition, for the sixth consecutive year since 2000, W acom won the top prize in the electronic tablet category of J apan's BCN Award 2005. This prize is presented to top ranking vendors on the basis of their annual sales volume of PC-related products. Cintiq...

  • Page 4
    ... Medical ( hospitals, dental clinics, medication, etc.) Education ( schools, prep schools, e-learning, etc.) Business ( office systems, shop systems, call centers, etc.) Pen sensor technology ( Tablet PCs, mobile phones, PDAs, games, etc.) Customers 3 W acom Co., Ltd. Annual Report 2005

  • Page 5
    ...a Product D ata Management ( PD M ) system, begins Sep. 1998 • Marketing of Intuos, a line of professional pen tablets, begins J une 1999 • Marketing of EC AD /dio, a C AD system for electrical engineering, begins N ov. 1999 • Marketing of Graphire/FAVO , a line of consumer pen tablets, begins...

  • Page 6
    ... unique user interface solutions designed to enhance human creativity. Under the corporate philosophy of "harmonious development between man and technology," W acom has served customers worldwide while growing into a global company with a presence in all major regions. Today, W acom is recognized as...

  • Page 7
    ... pen developed. Core technology established with electronic pens. Electronic seals and other security applications Pen sensor components Input market Tablets for consumer use Tablets for professional use les d Sa t an n e m elop D ev Interactive pen displays C AD market D igitizer and software...

  • Page 8
    ... key technologies, we transferred our manufacturing bases to Asian countries to reduce costs. As part of the transfer of our manufacturing operations, we ensure high product quality by providing technical guidance and support to electronics manufacturing services ( EMS) production lines in China and...

  • Page 9
    ... marketing and product planning for consumer pen tablets. W EG provides market support in six languages. W acom Tech. Corp. W ACOM China Corporation ( W CC ) W CC was established in 2000 in Beijing.The company established and implemented a unique sales strategy for low-price tablets in the Chinese...

  • Page 10
    ... and sales of pen tablets, pen sensor components and related software. Pen tablets are computer data entry devices consisting of an electronic pen and a tablet. Pen sensor components include products such as electronic pens, sensor boards and pen sensor controller ICs. Pen tablets are used in...

  • Page 11
    ... display. Interactive pen displays for general users are widely used in such areas as medical care services, including electronic medical charts, education, call centers, and household use. Consumer Pen Tablet The Graphire/FAVO series, designed for general PC users, is user-friendly and features...

  • Page 12
    ... prowess and expertise we have accumulated over decades with the objective of entering overseas markets. Market demand CAD Component parts list ECS Business After sales service Procurement PDM Marketing activities/ order-receiving Shipment Manufacturing 11 W acom Co., Ltd. Annual Report 2005

  • Page 13
    .../ applied technology Solution Business Electronic seals Solutions employing pen tablet technology Expansion of Business Areas Individuals Enterprises Education sector Medical care and welfare sectors Financial institutions Public institutions ECS Business W acom Co., Ltd. Annual Report 2005 12

  • Page 14
    ...: Chief Financial O fficer H idetoshi Kamoto: Component Business D ivision Yuji W akabayashi: Engineering Collaborative Solutions D ivision ( As of J uly 1, 2005 ) Masahiko Yamada: President Sadao Yamamoto Takeshi O ki Shigeki Komiyama W ataru H asegawa Yasuyuki Fujishima Corporate Governance...

  • Page 15
    ... Business Performance 19 Consolidated Balance Sheets 21 Consolidated Statements of Income 22 Consolidated Statements of Shareholders' Equity 23 Consolidated Statements of Cash Flows 24 N otes to Consolidated Financial Statements 32 Repor t of Independent Auditors W acom Co., Ltd. Annual Report 2005...

  • Page 16
    ...50 87.41 * N ote 1: U.S. dollar amounts have been translated from yen, for convenience only, at the rate of ¥107.39= U.S.$1, the approximate exchange rate prevailing on March 31, 2005. * * N ote 2: Common shares were split on a five-for-one basis on N ovember 20, 2003. N et sales (Millions of yen...

  • Page 17
    ... sales growth. In addition to the existing market for graphics use, we explored new markets, including corporate users, by launching a new Biz Tablet for business use. W e also released a new Bluetooth-enabled wireless tablet model in the Graphire/FAVO series, a leading product for consumers...

  • Page 18
    ... of new customers in response to the expanding Tablet PC market. In the second half of this fiscal year, we released the W 8002 pen sensor controller for small information appliances such as mobile phones and prepared for the mass production and product delivery of this unit. As a result, sales grew...

  • Page 19
    ...$2 million (up 117.5% year-on-year), for payment of cash dividends and the expenditure of ¥324 million, or U.S. $3 million (down 47.0% year-on-year), for payment of longterm debt. -200 -400 -723 -600 -800 -1,039 -1,000 -1,200 '01 '02 '03 '04 '05 W acom Co., Ltd. Annual Report 2005 18

  • Page 20
    ... yen Thousands of U.S. dollars ( N ote 1 ) March 31 Assets Current assets: Cash and cash equivalents ( N otes 2 and 5 ) N otes and accounts receivable, trade Inventories ( N otes ... 15) The accompanying notes are an integral part of the financial statements. 19 W acom Co., Ltd. Annual Report 2005

  • Page 21
    Thousands of yen Thousands of U.S. dollars ( N ote 1 ) March 31 Liabilities and Shareholders' Equity Current liabilities: Short-term debt ( N ote 5 ) N otes and accounts payable, trade Accrued income taxes ( N otes 2 and 10 ) Accrued bonuses to employees O ther current liabilities Total current ...

  • Page 22
    ...2004 Thousands of U.S. dollars ( N ote 1 ) Year ended March 31 2005 2005 N et sales ( N ote 15) Cost of sales ( N ote 15) Gross profit Selling, general and administrative expenses ( N otes 8, 9 and 15 ) O perating income O ther income: Interest and dividend income Foreign exchange gain, net Gain...

  • Page 23
    ...ew stock issued in public offering Exercise of warrants End of period ¥1,069,550 272,610 32,130 ¥1,374,290 ¥1,374,290 - 67,565 ¥1,441,855 $12,797 - 629 $13,426 Retained earnings: Beginning of period Add - N et income D educt - Cash dividends paid Bonuses to directors D ecrease resulting from...

  • Page 24
    ... of long-term debt Payments of other long-term liabilities D ividends paid Proceeds from issuance of stock O ther, net N et cash used in financing activities Effect of exchange rate changes on cash and cash equivalents N et increase in cash and cash equivalents Cash and cash equivalents at beginning...

  • Page 25
    ...these securities are reported as a separate component in shareholders' equity at a net-of-tax amount. O ther securities for which market quotations are unavailable are stated at cost. 2. Summary of significant accounting policies: ( 1) Consolidation The consolidated financial statements include the...

  • Page 26
    ... based on the useful life of 3 years. ( 8) Accrued retirement benefits Lump-sum severance indemnity regulations of the Company, which cover substantially all employees, provide for benefit payments determined by reference to the employee's current basic rate of pay, length of service, position in...

  • Page 27
    ... of U.S. dollars March 31, 2005 Book carrying amount H eld-to-maturity debt securities Share stocks invested in affiliates O ther securities Share stocks not listed in the market (excluding over-the-counter stocks) ¥- - 55,643 ¥55,643 $- - 518 $518 W acom Co., Ltd. Annual Report 2005 26

  • Page 28
    ... 2004 March 31 2005 Thousands of U.S. dollars March 31 2005 Unsecured zero-coupon standard bond due 2005 Unsecured standard bond due 2006 with interest rate of 1.100% per annum Unsecured floating rate bond due 2007 (0.190% at March 31, 2005) Secured bank loans due 2005 to 2010 with average interest...

  • Page 29
    ... Accrued expenses Accrued retirement benefits Accrued bonuses Inventory-intercompany profit Accrued severance indemnities for directors and statutory corporate auditors Tax loss carryforwards W rite - down of investment securities Enterprise tax Software development costs W rite - down of membership...

  • Page 30
    ...to major international finance institutions, the Company does not anticipate any losses arising from credit risk. The following are the stock options granted to directors and employees which would result in increasing the number of common shares with the following exercise prices. D ate of ordinary...

  • Page 31
    ... the management control of the business. b) Main products of each business segment: i) ESD business: Professional graphics tablet, Consumer graphics tablet, LCD tablet, Pen sensor component ii) ECS business: EC AD /duo, ProøD enki, SMARTEAM iii) EH I business: Electronic Seal inpplet c) Corporate...

  • Page 32
    ... to each segment. i) N orth America: U.S.A., Canada ii) Europe: United Kingdom, Germany, France, N etherlands iii) O thers: South Korea,Taiwan, Australia, China c) O verseas sales comprise sales of the Company and its consolidated subsidiaries outside J apan. 31 W acom Co., Ltd. Annual Report 2005

  • Page 33
    W acom Co., Ltd. Annual Report 2005 32

  • Page 34
    ...tablets • Consumer pen tablets • Interactive pen display • Pen sensor components 2. Engineering Collaborative Solutions ( ECS) Business D evelopment, manufacture, sale, support, and maintenance of industrial systems • Electronic design C AD software • PD M/SMARTEAM H ead O ffice / Factory...

  • Page 35
    Stock Exchange Listing J asdaq Securities Exchange ( Trade code 6727 ) Share Data Total number of shares to be issued Total number of issued ...W ilnau Co. Masahiko Yamada Yoshimi O gawa Unitech H oldings International Co., Ltd. O HJ IC Co., Ltd. Koichi N oda J apan Trustee Services Bank, Ltd. ( Trust...

  • Page 36
    © 2005 W acom Co., Ltd. All Rights Reserved