FORM 6-K
U.S.SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Report of Foreign Private Issuer
Pursuant to Rule 13a-16 or 15d-16 of
the Securities Exchange Act of 1934
Commission File Number: 333-13896
Supplement For the month of March 2009.
Total number of pages: 43
The exhibit index is located on page 1
NIDEC CORPORATION
(Translation of registrant’s name into English)
338 KuzeTonoshiro-Cho,
Minami-Ku,Kyoto 601-8205 Japan
(Address of principal executive offices)
Indicate by check mark whether the registrant files or will file annual reports under cover Form 20-F or Form 40-F:
Form 20-F X Form 40-F __
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): _
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): _
Indicate by check mark whether by furnishing the information contained in this Form, the registrant is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.
Yes __ No X
If “Yes” is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b): 82-_____
Information furnished on this form:
EXHIBITS
Exhibit Number
1
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
Date: March 31, 2009 | ||||
NIDEC CORPORATION | ||||
By: /S/ Masahiro Nagayasu | ||||
General Manager, Investor Relations |
2
NEWS RELEASE
NIDEC CORPORATION
New York Stock Exchange symbol: NJ
Stock exchange code (Tokyo, Osaka): 6594
FOR IMMEDIATE RELEASE
Contact: | |
Masahiro Nagayasu | |
General Manager | |
Investor Relations | |
+81-75-935-6140 | |
ir@jp.nidec.com |
QUARTERLY FINANCIAL STATEMENTS (U.S. GAAP)
RESULTS FOR THE THIRD QUARTER AND NINE MONTHS ENDED DECEMBER 31, 2008 (Unaudited)
(FROM APRIL 1, 2008 TO DECEMBER 31, 2008)
CONSOLIDATED
Released on March 31, 2009
3
NIDEC CORPORATION
338 Kuzetonoshiro-cho,
Minami-ku, Kyoto 601-8205 Japan
CONSOLIDATED FINANCIAL RESULTS FOR THE THIRD QUARTER AND NINE MONTHS ENDED DECEMBER 31, 2008 (Unaudited) |
CONSOLIDATED STATEMENTS OF INCOME
Yen in millions | U.S. dollars in thousands | |||||||||
(except per share amounts) | ||||||||||
For the three months ended December 31 | ||||||||||
2007 | 2008 | 2008 | ||||||||
Net sales | ¥ 193,150 | ¥ 141,186 | $ 1,550,983 | |||||||
Operating income | 23,118 | 10,038 | 110,271 | |||||||
Income (loss) from continuing operations before income taxes | 22,193 | (2,078 | ) | (22,828 | ) | |||||
Income (loss) from continuing operations | 13,955 | (2,428 | ) | (26,673 | ) | |||||
Loss on discontinued operations | (9 | ) | (2,349 | ) | (25,804 | ) | ||||
Net income (loss) | ¥ 13,946 | ¥ (4,777 | ) | $ (52,477 | ) | |||||
Per share data | ||||||||||
Earning per share - basic | ||||||||||
Income (loss) from continuing operations | ¥ 96.28 | ¥ (16.85 | ) | $ (0.18 | ) | |||||
Loss on discontinued operations | (0.06 | ) | (16.31 | ) | (0.18 | ) | ||||
Net income (loss) | 96.22 | (33.16 | ) | (0.36 | ) | |||||
Earning per share - diluted | ||||||||||
Income (loss) from continuing operations | 93.68 | (16.85 | ) | (0.18 | ) | |||||
Loss on discontinued operations | (0.06 | ) | (16.31 | ) | (0.18 | ) | ||||
Net income (loss) | ¥ 93.62 | ¥ (33.16 | ) | $ (0.36 | ) |
4
Yen in millions | U.S. dollars in thousands | |||||||||
(except per share amounts) | ||||||||||
For the nine months ended December 31 | ||||||||||
2007 | 2008 | 2008 | ||||||||
Net sales | ¥ 549,221 | ¥ 506,406 | $ 5,563,067 | |||||||
Operating income | 57,537 | 50,816 | 558,234 | |||||||
Income from continuing operations before income taxes | 54,115 | 41,303 | 453,730 | |||||||
Income from continuing operations | 34,579 | 25,618 | 281,424 | |||||||
Loss on discontinued operations | (276 | ) | (2,555 | ) | (28,068 | ) | ||||
Net income | ¥ 34,303 | ¥ 23,063 | $ 253,356 | |||||||
Per share data | ||||||||||
Earning per share - basic | ||||||||||
Income from continuing operations | ¥ 238.63 | ¥ 177.08 | $ 1.94 | |||||||
Loss on discontinued operations | (1.90 | ) | (17.66 | ) | (0.19 | ) | ||||
Net income | 236.73 | 159.42 | 1.75 | |||||||
Earning per share - diluted | ||||||||||
Income from continuing operations | 232.13 | 173.25 | 1.90 | |||||||
Loss on discontinued operations | (1.85 | ) | (17.31 | ) | (0.19 | ) | ||||
Net income | ¥ 230.28 | ¥ 155.94 | $ 1.71 |
CONSOLIDATED BALANCE SHEETS
Yen in millions | U.S. dollars in thousands | |||||||||
March 31, 2008 | December 31, 2008 | December 31, 2008 | ||||||||
Current assets | ¥ 356,998 | ¥ 355,898 | $ 3,909,678 | |||||||
Investments | 17,587 | 15,282 | 167,879 | |||||||
Property, plant, equipment and others | 297,129 | 288,932 | 3,174,030 | |||||||
Total assets | 671,714 | 660,112 | 7,251,587 | |||||||
Current liabilities | 253,099 | 278,253 | 3,056,718 | |||||||
Long-term liabilities | 30,845 | 28,145 | 309,183 | |||||||
Total liabilities | 283,944 | 306,398 | 3,365,901 | |||||||
Minority interest in consolidated subsidiaries | 68,186 | 61,724 | 678,062 | |||||||
Shareholders’ equity | 319,584 | 291,990 | 3,207,624 | |||||||
Total liabilities and shareholders’ equity | ¥ 671,714 | ¥ 660,112 | $ 7,251,587 |
5
CONSOLIDATED STATEMENTS OF CASH FLOWS
Yen in millions | U.S. dollars in thousands | |||||||||
For the nine months ended December 31 | ||||||||||
2007 | 2008 | 2008 | ||||||||
Net cash provided by operating activities | ¥ 57,285 | ¥ 47,195 | $ 518,455 | |||||||
Net cash used in investing activities | (32,887 | ) | (45,793 | ) | (503,053 | ) | ||||
Net cash (used in) provided by financing activities | (22,100 | ) | 24,497 | 269,109 | ||||||
Effect of exchange rate changes on cash and cash equivalents | (895 | ) | (11,922 | ) | (130,968 | ) | ||||
Net increase in cash and cash equivalents | 1,403 | 13,977 | 153,543 | |||||||
Cash and cash equivalents at beginning of period | 88,784 | 100,809 | 1,107,426 | |||||||
Cash and cash equivalents at end of period | ¥ 90,187 | ¥ 114,786 | $ 1,260,969 | |||||||
Cautionary Note Regarding Forward-Looking Statements This report contains forward-looking statements that are based on our current expectations, assumptions, estimates and projections about our business, our industry and capital markets around the world. These forward-looking statements are subject to various risks and uncertainties. Generally, these forward-looking statements can be identified by the use of forward-looking terminology such as “may,” “will,” “expect,” “anticipate,” “seek”, “estimate,” “plan” or similar words. These statements discuss future expectations, identify strategies, contain projections of results of operations or of our financial condition, or state other forward-looking information. Known and unknown risks, uncertainties and other factors could cause the actual results to differ materially from those contained in any forward-looking statement. We cannot promis e that our expectations expressed in these forward-looking statements will turn out to be correct. Our actual results could be materially different from and worse than our expectations as a result of various factors, including, but not limited to, (i) our ability to design, develop, mass produce and win acceptance of our products, particularly those that use fluid dynamic bearing motor technology, which are offered in highly competitive markets characterized by continual new products introduction and rapid technological development, (ii) general economic conditions in the computer, information technology and related product markets, particularly in the level of consumer spending, (iii) exchange rate fluctuations, particularly between the Japanese yen and the U.S. dollar and other currencies in which we make significant sales or in which our assets and liabilities are denominated, (iv) our ability to acquire and successfully integrate companies or businesses with complementary technologies and product lines, including, for example, the motors and actuators business of Valeo S.A. (France), which we acquired in December 2006, and (v) adverse changes in laws, regulations or economic policies in any of the countries where we have manufacturing operations, especially China. |
As used in this document, references to “we,” ”our” and “us” are to Nidec Corporation and, except as the context otherwise requires, its consolidated subsidiaries; “U.S. dollar” or “$” means the lawful currency of the United States of America, and “yen” or “¥” means the lawful currency of Japan; and “U.S. GAAP” means accounting principles generally accepted in the United States, and “Japanese GAAP” means accounting principles generally accepted in Japan.
6
Results of Operations — Three and Nine Months Ended December 31, 2008 Compared to Three and Nine Months Ended December 31, 2007
As of December 31, 2008, we discontinued our optical pickup unit (“OPU”) business which had been included within “electronic and optical components”. Net sales of electronic and optical components mentioned below don't include the sales amounts of OPU business pursuant to the Statement of Financial Accounting Standards No.144, “Accounting for the impairment or disposal of Long-Lived Assets”. The prior period OPU amounts included in the results for the three and nine months ended December 31, 2007 have also been excluded from the net sales amounts mentioned below, retrospectively.
Net Sales
(Yen in millions) For the three months ended December 31 | ||||||||||||||
2007 | 2008 | Inc/Dec | % | |||||||||||
Net sales: | ||||||||||||||
Small precision motors: | ||||||||||||||
Hard disk drives spindle motors | ¥ 63,089 | ¥ 37,533 | ¥ (25,556 | ) | (40.5 | )% | ||||||||
Other small precision brushless DC motors | 24,494 | 16,331 | (8,163 | ) | (33.3 | ) | ||||||||
Brushless DC fans | 12,592 | 8,948 | (3,644 | ) | (28.9 | ) | ||||||||
Other small precision motors | 6,844 | 5,821 | (1,023 | ) | (14.9 | ) | ||||||||
Sub-total | 107,019 | 68,633 | (38,386 | ) | (35.9 | ) | ||||||||
Mid-size motors | 23,268 | 15,898 | (7,370 | ) | (31.7 | ) | ||||||||
Machinery | 18,161 | 19,714 | 1,553 | 8.6 | ||||||||||
Electronic and optical components | 37,578 | 29,784 | (7,794 | ) | (20.7 | ) | ||||||||
Others | 7,124 | 7,157 | 33 | 0.5 | ||||||||||
Consolidated total | ¥ 193,150 | ¥ 141,186 | ¥ (51,964 | ) | (26.9 | )% | ||||||||
(Yen in millions) For the nine months ended December 31 | ||||||||||||||
2007 | 2008 | Inc/Dec | % | |||||||||||
Net sales: | ||||||||||||||
Small precision motors: | ||||||||||||||
Hard disk drives spindle motors | ¥ 171,192 | ¥ 147,358 | ¥ (23,834 | ) | (13.9 | )% | ||||||||
Other small precision brushless DC motors | 70,103 | 61,638 | (8,465 | ) | (12.1 | ) | ||||||||
Brushless DC fans | 36,764 | 31,369 | (5,395 | ) | (14.7 | ) | ||||||||
Other small precision motors | 17,267 | 18,211 | 944 | 5.5 | ||||||||||
Sub-total | 295,326 | 258,576 | (36,750 | ) | (12.4 | ) | ||||||||
Mid-size motors | 70,941 | 63,500 | (7,441 | ) | (10.5 | ) | ||||||||
Machinery | 53,130 | 60,321 | 7,191 | 13.5 | ||||||||||
Electronic and optical components | 110,055 | 101,298 | (8,757 | ) | (8.0 | ) | ||||||||
Others | 19,769 | 22,711 | 2,942 | 14.9 | ||||||||||
Consolidated total | ¥ 549,221 | ¥ 506,406 | ¥ (42,815 | ) | (7.8 | )% | ||||||||
7
Our net sales decreased ¥51,964 million, or 26.9%, from ¥193,150 million for the three months ended December 31, 2007 to ¥141,186 million for the three months ended December 31, 2008. Net sales of all product segments, excluding Machinery and Other products, decreased. This decrease was due to a world wide recession that reflected growing financial unrest, triggered by a variety of factors including the sub-prime loan crisis in the U.S.A. and yen appreciation against the U.S. dollar.
Our net sales decreased ¥42,815 million, or 7.8%, from ¥549,221 million for the nine months ended December 31, 2007 to ¥506,406 million for the nine months ended December 31, 2008.
(Small precision motors)
Net sales of small precision motors decreased ¥38,386 million, or 35.9%, from ¥107,019 million for the three months ended December 31, 2007 to ¥68,633 million for the three months ended December 31, 2008. Net sales of each product included in the “small precision motors” are as shown below.
Net sales of small precision motors decreased ¥36,750 million, or 12.4%, from ¥295,326 million for the nine months ended December 31, 2007 to ¥258,576 million for the nine months ended December 31, 2008.
Hard disk drives spindle motors
Net sales of hard disk drives spindle motors decreased ¥25,556 million, or 40.5%, from ¥63,089 million for the three months ended December 31, 2007 to ¥37,533 million for the three months ended December 31, 2008. Sales volume of hard disk drives spindle motors decreased by over 20% compared to the same period of the previous fiscal year. This volume decrease was mainly due to lower customers' demands due to drastic changes in the business climate since middle of November, 2008. In addition the yen appreciated against the U.S. dollar. Net sales of hard disk drives spindle motors accounted for 32.7% of total net sales for the three months ended December 31, 2007 and 26.6% of total net sales for the three months ended December 31, 2008.
Net sales of hard disk drives spindle motors decreased ¥23,834 million, or 13.9%, from ¥171,192 million for the nine months ended December 31, 2007 to ¥147,358 million for the nine months ended December 31, 2008.
Other small precision brushless DC motors
Net sales of other small precision brushless DC motors decreased ¥8,163 million, or 33.3%, from ¥24,494 million for the three months ended December 31, 2007 to ¥16,331 million for the three months ended December 31, 2008. This decrease was mainly due to a decrease in customer demand and yen appreciation against the U.S. dollar. Net sales of other small precision brushless DC motors accounted for 12.7% of total net sales for the three months ended December 31, 2007 and 11.6% of total net sales for the three months ended December 31, 2008.
Net sales of other small precision brushless DC motors decreased ¥8,465 million, or 12.1%, from ¥70,103 million for the nine months ended December 31, 2007 to ¥61,638 million for the nine months ended December 31, 2008.
Brushless DC fans
Net sales of brushless DC fans decreased ¥3,644 million, or 28.9%, from ¥12,592 million for the three months ended December 31, 2007 to ¥8,948 million for the three months ended December 31, 2008. This decrease was mainly due to a decrease in customer demand and yen appreciation against the U.S. dollar. Net sales of brushless DC fans accounted for 6.5% of total net sales for the three months ended December 31, 2007 and 6.3% of total net sales for the three months ended December 31, 2008.
8
Net sales of brushless DC fans decreased ¥5,395 million, or 14.7%, from ¥36,764 million for the nine months ended December 31, 2007 to ¥31,369 million for the nine months ended December 31, 2008.
Other small precision motors
Net sales of other small precision motors decreased ¥1,023 million, or 14.9%, from ¥6,844 million for the three months ended December 31, 2007 to ¥5,821 million for the three months ended December 31, 2008. This was mainly due to a decrease in customer demand. Net sales of other small precision motors accounted for 3.5% of total net sales for the three months ended December 31, 2007 and 4.1% of total net sales for the three months ended December 31, 2008.
Net sales of other small precision motors increased ¥944 million, or 5.5%, from ¥17,267 million for the nine months ended December 31, 2007 to ¥18,211 million for the nine months ended December 31, 2008.
(Mid-size motors)
Net sales of mid-size motors decreased ¥7,370 million, or 31.7%, from ¥23,268 million for the three months ended December 31, 2007 to ¥15,898 million for the three months ended December 31, 2008, due mainly to a decrease in demand of motors for automobiles. Net sales of other mid-size motors for home appliance and industrial use also decreased due to the current recession. Net sales of mid-size motors accounted for 12.0% of our total net sales for the three months ended December 31, 2007 and 11.3% of total net sales for the three months ended December 31, 2008.
Net sales of mid-size motors decreased ¥7,441 million, or 10.5%, from ¥70,941 million for the nine months ended December 31, 2007 to ¥63,500 million for the nine months ended December 31, 2008.
(Machinery)
Net sales of machinery increased ¥1,553 million, or 8.6%, from ¥18,161 million for the three months ended December 31, 2007 to ¥19,714 million for the three months ended December 31, 2008. This increase was primarily due to an increase in net sales of Nidec Sankyo's LCD panel handling robots due to recovered demand compared to the same period of the previous fiscal year. Net sales of Nidec-Shimpo's factory automation equipment and Nidec-Read's testing equipments also increased, but net sales of the remaining machinery decreased. Net sales of machinery accounted for 9.4% of our total net sales for the three months ended December 31, 2007 and 14.0% of total net sales for the three months ended December 31, 2008.
Net sales of machinery increased ¥7,191 million, or 13.5%, from ¥53,130 million for the nine months ended December 31, 2007 to ¥60,321 million for the nine months ended December 31, 2008.
(Electronic and optical components)
As of December 31, 2008, we discontinued our optical pickup unit (“OPU”) business which had been included within “electronic and optical components”. Net sales of electronic and optical components mentioned don't include the sales amounts of OPU business pursuant to the Statement of Financial Accounting Standards No.144, “Accounting for the impairment or disposal of Long-Lived Assets”. The prior period sales amounts of the OPU have also been excluded from the net sales amounts mentioned, retrospectively.
9
Net sales of electronic and optical components decreased ¥7,794 million, or 20.7%, from ¥37,578 million for the three months ended December 31, 2007 to ¥29,784 million for the three months ended December 31, 2008. This decrease was primarily due to a decrease in net sales of shutters for digital cameras and mobile phones by Nidec Copal, electronic components for amusement machines by Nidec Copal Electronics. Net sales of electronic and optical components accounted for 19.5% of our total net sales for the three months ended December 31, 2007 and 21.1% of total net sales for the three months ended December 31, 2008.
Net sales of electronic and optical components decreased ¥8,757 million, or 8.0%, from ¥110,055 million for the nine months ended December 31, 2007 to ¥101,298 million for the nine months ended December 31, 2008.
(Others)
Net sales of other products increased ¥33 million, or 0.5%, from ¥7,124 million for the three months ended December 31, 2007 to ¥7,157 million for the three months ended December 31, 2008. Net sales of other products accounted for 3.7% of total net sales for the three months ended December 31, 2007 and 5.0% of total net sales for the three months ended December 31, 2008.
Net sales of other products increased ¥2,942 million, or 14.9%, from ¥19,769 million for the nine months ended December 31, 2007 to ¥22,711 million for the nine months ended December 31, 2008.
Cost of Products Sold
Our cost of products sold decreased ¥39,230 million, or 26.0%, from ¥150,682 million for the three months ended December 31, 2007 to ¥111,452 million for the three months ended December 31, 2008. This decrease was due mainly to sharp decreases in sales and yen appreciation against the U.S. dollars.
As a percentage of net sales, our cost of products sold increased from 78.0% for the three months ended December 31, 2007 to 78.9% for the three months ended December 31, 2008. This increase was due to invariable fixed costs despite sharp decreases in sales.
Our cost of products sold decreased ¥37,133 million, or 8.6%, from ¥430,944 million for the nine months ended December 31, 2007 to ¥393,811 million for the nine months ended December 31, 2008.
Selling, General and Administrative Expenses
Our selling, general and administrative expenses increased ¥868 million, or 7.3%, from ¥11,934 million for the three months ended December 31, 2007 to ¥12,802 million for the three months ended December 31, 2008. This increase was due mainly to a decrease in a gain related to fixed assets for the same period of the previous fiscal year and an increase in provision for doubtful accounts, which offset a decrease in personnel expenses.
As a percentage of net sales, our selling, general and administrative expenses increased from 6.2% for the three months ended December 31, 2007 to 9.1% for the three months ended December 31, 2008. This increase was due to sharp decreases in sales despite the improvement in cost efficiency.
Our selling, general and administrative expenses increased ¥1,874 million, or 4.9%, from ¥38,396 million for the nine months ended December 31, 2007 to ¥40,270 million for the nine months ended December 31, 2008.
10
Research and Development Expenses
Our research and development expenses decreased ¥522 million, or 7.0%, from ¥7,416 million for the three months ended December 31, 2007 to ¥6,894 million for the three months ended December 31, 2008. This decrease was primarily due to a decrease in research and development expenses related to small precision motors.
As a percentage of net sales, our research and development expenses increased from 3.8% for the three months ended December 31, 2007 to 4.9% for the three months ended December 31, 2008.
Our research and development expenses decreased ¥835 million, or 3.7%, from ¥22,344 million for the nine months ended December 31, 2007 to ¥21,509 million for the nine months ended December 31, 2008.
Operating Income
As a result of the foregoing, our operating income decreased ¥13,080 million, or 56.6%, from ¥23,118 million for the three months ended December 31, 2007 to ¥10,038 million for the three months ended December 31, 2008.
As a percentage of net sales, our operating income decreased from 12.0% for the three months ended December 31, 2007 to 7.1% for the three months ended December 31, 2008.
Our operating income decreased ¥6,721 million, or 11.7%, from ¥57,537 million for the nine months ended December 31, 2007 to ¥50,816 million for the nine months ended December 31, 2008.
Other Income (Expense)
Our other expense increased ¥11,191 million, from ¥925 million for the three months ended December 31, 2007 to ¥12,116 million for the three months ended December 31, 2008. This increase was mainly due to an increase in the foreign exchange loss.
Our foreign exchange loss, net increased ¥11,820 million, from ¥1,008 million for the three months ended December 31, 2007 to ¥12,828 million for the three months ended December 31, 2008.
Our other expense increased ¥6,091 million, or 178.0%, from ¥3,422 million for the nine months ended December 31, 2007 to ¥9,513 million for the nine months ended December 31, 2008. This increase was mainly due to foreign exchange rate fluctuations.
The exchange rate was ¥114.15 per U.S. dollar as of December 31, 2007 and ¥115.43 per U.S. dollar as of September 30, 2007. The yen appreciated to ¥91.03 per U.S. dollar as of December 31, 2008 and ¥103.57 per U.S. dollar as of September 30, 2008.
11
Income (Loss) from continuing operations before Income Taxes
As a result of the foregoing, we incurred loss before income taxes in the amount of ¥2,078 million for the three months ended December 31, 2008, while we had income before income taxes in the amount of ¥22,193 million for the three months ended December 31, 2007.
As a percentage of net sales, our income (loss) before income taxes decreased from 11.5% for the three months ended December 31, 2007 to minus 1.5 % for the three months ended December 31, 2008.
Our income before income taxes decreased ¥12,812 million, or 23.7%, from ¥54,115 million for the nine months ended December 31, 2007 to ¥41,303 million for the nine months ended December 31, 2008.
Income Taxes
Our income taxes decreased ¥5,752 million, or 97.1%, from ¥5,923 million for the three months ended December 31, 2007 to ¥171 million for the three months ended December 31, 2008.
Our income taxes decreased ¥2,806 million, or 19.8%, from ¥14,143 million for the nine months ended December 31, 2007 to ¥11,337 million for the nine months ended December 31, 2008.
The estimated effective income tax rate for the nine months ended December 31, 2008 was higher compared to the corresponding prior period. This was mainly due to the net impact of an increase in the impact of difference in the tax rates of foreign subsidiaries offset by increases in valuation allowance and in adoption of FIN No.48, Accounting for Uncertainty in Income Taxes.
For the details, please see Note 6.
Minority Interest in Income of Consolidated Subsidiaries
Our minority interest in income of consolidated subsidiaries decreased ¥2,138 million, or 91.6%, from ¥2,333 million for the three months ended December 31, 2007 to ¥195 million for the three months ended December 31, 2008. This decrease was primarily due to an increase in the loss of group companies such as Nidec Sankyo Corporation and certain of its subsidiaries.
Our minority interest in income of consolidated subsidiaries decreased ¥1,116 million, or 20.7%, from ¥5,386 million for the nine months ended December 31, 2007 to ¥4,270 million for the nine months ended December 31, 2008.
12
Equity in Net Income (Loss) of Affiliated Companies
Our equity in net income of affiliated companies decreased ¥2 million, or 11.1%, from ¥18 million for the three months ended December 31, 2007 to ¥16 million for the three months ended December 31, 2008.
Our equity in net loss of affiliated companies increased ¥71 million, from ¥7 million for the nine months ended December 31, 2007 to ¥78 million for the nine months ended December 31, 2008.
Income (Loss) from continuing operations
As a result of the foregoing, we incurred loss on continuing operations in the amount of ¥2,428 million for the three months ended December 31, 2008, while we had income from continuing operations in the amount of ¥13,955 million for the three months ended December 31, 2007.
As a percentage of net sales, our income (loss) from continuing operations decreased from 7.2% for the three months ended December 31, 2007 to minus 1.7 % for the three months ended December 31, 2008.
Our income from continuing operations decreased ¥8,961 million, or 25.9%, from ¥34,579 million for the nine months ended December 31, 2007 to ¥25,618 million for the nine months ended December 31, 2008.
Loss on discontinued operations
Our loss on discontinued operations increased ¥2,340 million from ¥9 million for the three months ended December 31, 2007 to ¥2,349 million for the three months ended December 31, 2008.
Our loss on discontinued operations increased ¥2,279 million, or 825.7%, from ¥276 million for the nine months ended December 31, 2007 to ¥2,555 million for the nine months ended December 31, 2008.
For the details, please see Note 8.
Net Income (Loss)
As a result of the foregoing, we incurred net loss in the amount of ¥4,777 million for the three months ended December 31, 2008, while we had net income in the amount of ¥13,946 million for the three months ended December 31, 2007.
As a percentage of net sales, our net income (loss) decreased from 7.2% for the three months ended December 31, 2007 to minus 3.4 % for the three months ended December 31, 2008.
Our net income decreased ¥11,240 million, or 32.8%, from ¥34,303 million for the nine months ended December 31, 2007 to ¥23,063 million for the nine months ended December 31, 2008.
13
Segment Information
Based on the applicable criteria set forth in the Statement of Financial Accounting Standards No. 131, “Disclosures about Segments of an Enterprise and Related Information” (“SFAS No. 131”), we have sixteen reportable operating segments on which we report in our consolidated financial statements. For the information required by SFAS No. 131, see Note 10 to our consolidated financial statements included in this release.
The NCJ segment comprises NIDEC Corporation in Japan, which primarily produces and sells hard disk drives spindle motors, DC motors, fans, and mid-size motors.
The NET segment comprises Nidec Electronics (Thailand) Co., Ltd. and Nidec Precision (Thailand) Co., Ltd., subsidiaries in Thailand, which primarily produce and sell hard disk drives spindle motors.
The NCC segment comprises Nidec (Zhejiang) Corporation, a subsidiary in China, which primarily produces and sells hard disk drives spindle motors.
The NCD segment comprises Nidec (Dalian) Limited, a subsidiary in China, which primarily produces and sells DC motors and fans.
The NCS segment comprises Nidec Singapore Pte. Ltd., a subsidiary in Singapore, which primarily produces and sells hard disk drives spindle motors and pivot assemblies, and sells DC motors and fans.
The NCH segment comprises Nidec (H.K.) Co., Ltd., a subsidiary in Hong Kong, which primarily sells hard disk drives spindle motors, DC motors and fans.
The NCF segment comprises Nidec Philippines Corporation and Nidec Precision Philippines Corporation, subsidiaries in The Philippines, which primarily produce and sell hard disk drives spindle motors.
The NSNK segment comprises Nidec Sankyo Corporation, a subsidiary in Japan, which primarily produces and sells DC motors, machinery, and optical and electronic parts.
The NCPL segment comprises Nidec Copal Corporation, a subsidiary in Japan, which primarily produces and sells optical and electronic parts and machinery.
The NTSC segment comprises Nidec Tosok Corporation, a subsidiary in Japan, which primarily produces and sells automobile parts and machinery.
The NCEL segment comprises Nidec Copal Electronics Corporation, a subsidiary in Japan, which primarily produces and sells electronic parts.
The NSRV segment comprises Nidec Servo Corporation in Japan, which primarily produces and sells DC motors, fans and other small precision motors. Japan Servo Co., Ltd. changed its name to Nidec Servo Corporation as of October 1, 2008 and ”JSRV” was changed to “NSRV”. NSRV has been a new operating segment since the three months ended September 30, 2007.
The NSBC segment comprises Nidec Shibaura Corporation, a subsidiary in Japan, which primarily produces and sells mid-size motors.
14
The NSCJ segment comprises Nidec-Shimpo Corporation, a subsidiary in Japan, which primarily produces and sells power transmission drives, measuring machines and electric potter’s wheels.
The NMA segment comprises Nidec Motors & Actuators (Germany) GmbH and other subsidiaries in Europe and North America, which primarily produce and sell in-car motors.
The NNSN segment comprises Nidec Nissin Corporation, a subsidiary in Japan, which primarily produces and sells optical components.
The All Others segment comprises subsidiaries that are operating segments but not designated as reportable segments due to materiality.
In accordance with SFAS No. 144, “Accounting for the Impairment or Disposal of Long-Lived Assets”, amounts in the segment information do not reflect discontinued operations, and previous fiscal year’s segment information has been reclassified to conform to the current presentation.
We evaluate our financial performance based on segmental profit and loss, which consists of sales and operating revenues less operating expenses. Segmental profit or loss is determined using the accounting principles in the segment’s country of domicile. NCJ, NSNK, NCPL, NTSC, NCEL, NSRV, NSBC, NSCJ, NNSN apply Japanese GAAP; NET applies Thai accounting principles; NCC and NCD apply Chinese accounting principles; NCS applies Singaporean accounting principles; NCH applies Hong Kong accounting principles; NCF applies Philippine accounting principles; NMA mainly applies International Financial Reporting Standards (IFRS). Therefore our segmental data has not been prepared under U.S. GAAP on a basis that is consistent with our consolidated financial statements or on any other single basis that is consistent among segments. While there are several differences between U.S. GAAP and the underlying accounting principles used by the operating segments, the principal differences that affect segmental operating profit or loss are accounting for pension and severance costs, and leases.
The first of the following two tables shows revenues from external customers and other operating segments by reportable operating segment for the three months ended December 31, 2007 and 2008. The second table shows operating profit or loss by reportable operating segment, which includes intersegment revenues, for the three months ended December 31, 2007 and 2008:
Three months ended December 31 | |||||||||
2007 | 2008 | 2008 | |||||||
(Yen in millions and U.S. dollars in thousands) | |||||||||
NCJ | |||||||||
External revenues | ¥ 23,894 | ¥ 13,291 | $ 146,007 | ||||||
Intersegment revenues | 27,887 | 16,488 | 181,127 | ||||||
Sub total | 51,781 | 29,779 | 327,134 | ||||||
NET | |||||||||
External revenues | 27,820 | 15,869 | 174,327 | ||||||
Intersegment revenues | 9,223 | 7,985 | 87,718 | ||||||
Sub total | 37,043 | 23,854 | 262,045 | ||||||
NCC | |||||||||
External revenues | 3,299 | 4,048 | 44,469 | ||||||
Intersegment revenues | 3,149 | 458 | 5,031 | ||||||
Sub total | 6,448 | 4,506 | 49,500 | ||||||
NCD | |||||||||
External revenues | 1,064 | 1,350 | 14,830 | ||||||
Intersegment revenues | 11,221 | 5,387 | 59,178 | ||||||
Sub total | 12,285 | 6,737 | 74,008 |
15
Three months ended December 31 | |||||||||
2007 | 2008 | 2008 | |||||||
(Yen in millions and U.S. dollars in thousands) | |||||||||
NCS | |||||||||
External revenues | 12,581 | 5,334 | 58,596 | ||||||
Intersegment revenues | 75 | 53 | 582 | ||||||
Sub total | 12,656 | 5,387 | 59,178 | ||||||
NCH | |||||||||
External revenues | 11,076 | 9,458 | 103,900 | ||||||
Intersegment revenues | 1,407 | 1,414 | 15,533 | ||||||
Sub total | 12,483 | 10,872 | 119,433 | ||||||
NCF | |||||||||
External revenues | 1,665 | 1,846 | 20,279 | ||||||
Intersegment revenues | 10,909 | 4,363 | 47,929 | ||||||
Sub total | 12,574 | 6,209 | 68,208 | ||||||
NSNK | |||||||||
External revenues | 11,647 | 14,322 | 157,333 | ||||||
Intersegment revenues | 3,054 | 2,795 | 30,704 | ||||||
Sub total | 14,701 | 17,117 | 188,037 | ||||||
NCPL | |||||||||
External revenues | 16,364 | 12,244 | 134,505 | ||||||
Intersegment revenues | 1,821 | 2,105 | 23,124 | ||||||
Sub total | 18,185 | 14,349 | 157,629 | ||||||
NTSC | |||||||||
External revenues | 6,639 | 5,565 | 61,134 | ||||||
Intersegment revenues | 63 | 36 | 395 | ||||||
Sub total | 6,702 | 5,601 | 61,529 | ||||||
NCEL | |||||||||
External revenues | 6,366 | 4,972 | 54,619 | ||||||
Intersegment revenues | 1,046 | 1,416 | 15,556 | ||||||
Sub total | 7,412 | 6,388 | 70,175 | ||||||
NSRV | |||||||||
External revenues | 6,927 | 4,350 | 47,786 | ||||||
Intersegment revenues | 936 | 763 | 8,382 | ||||||
Sub total | 7,863 | 5,113 | 56,168 | ||||||
NSBC | |||||||||
External revenues | 3,928 | 3,208 | 35,241 | ||||||
Intersegment revenues | 740 | 710 | 7,800 | ||||||
Sub total | 4,668 | 3,918 | 43,041 | ||||||
NSCJ | |||||||||
External revenues | 2,836 | 2,399 | 26,354 | ||||||
Intersegment revenues | 637 | 508 | 5,581 | ||||||
Sub total | 3,473 | 2,907 | 31,935 | ||||||
NMA | |||||||||
External revenues | 8,709 | 4,379 | 48,105 | ||||||
Intersegment revenues | 117 | 5 | 55 | ||||||
Sub total | 8,826 | 4,384 | 48,160 |
16
Three months ended December 31 | |||||||||
2007 | 2008 | 2008 | |||||||
(Yen in millions and U.S. dollars in thousands) | |||||||||
NNSN | |||||||||
External revenues | 2,788 | 2,334 | 25,640 | ||||||
Intersegment revenues | 198 | 131 | 1,439 | ||||||
Sub total | 2,986 | 2,465 | 27,079 | ||||||
All Others | |||||||||
External revenues | 42,590 | 31,333 | 344,206 | ||||||
Intersegment revenues | 56,237 | 42,568 | 467,627 | ||||||
Sub total | 98,827 | 73,901 | 811,833 | ||||||
Total | |||||||||
External revenues | 190,193 | 136,302 | 1,497,331 | ||||||
Intersegment revenues | 128,720 | 87,185 | 957,761 | ||||||
Adjustments(*) | 2,957 | 4,884 | 53,652 | ||||||
Intersegment elimination | (128,720 | ) | (87,185 | ) | (957,761 | ) | |||
Consolidated total (net sales) | ¥ 193,150 | ¥ 141,186 | $ 1,550,983 | ||||||
(*) See Note 10 to the unaudited interim consolidated financial statements.
Three months ended December 31 | ||||||||||
2007 | 2008 | 2008 | ||||||||
(Yen in millions and U.S. dollars in thousands) | ||||||||||
Segment profit or loss: | ||||||||||
NCJ | ¥ 4,814 | ¥ 468 | $ 5,141 | |||||||
NET | 3,969 | 3,948 | 43,370 | |||||||
NCC | 260 | (211 | ) | (2,318 | ) | |||||
NCD | 1,156 | 493 | 5,416 | |||||||
NCS | 409 | 55 | 604 | |||||||
NCH | 183 | 140 | 1,538 | |||||||
NCF | 1,163 | 485 | 5,328 | |||||||
NSNK | 1,197 | 1,004 | 11,029 | |||||||
NCPL | 716 | 307 | 3,373 | |||||||
NTSC | 521 | (14 | ) | (154 | ) | |||||
NCEL | 1,283 | 480 | 5,273 | |||||||
NSRV | 52 | (325 | ) | (3,570 | ) | |||||
NSBC | (96 | ) | (162 | ) | (1,780 | ) | ||||
NSCJ | 314 | 59 | 648 | |||||||
NMA | 194 | (427 | ) | (4,691 | ) | |||||
NNSN | 160 | 41 | 451 | |||||||
All Others | 6,312 | 3,198 | 35,132 | |||||||
Total | 22,607 | 9,539 | 104,790 | |||||||
Adjustments (*) | 511 | 499 | 5,481 | |||||||
Consolidated total | ¥ 23,118 | ¥ 10,038 | $ 110,271 | |||||||
(*) See Note 10 to the unaudited interim consolidated financial statements.
17
Net sales of NCJ decreased ¥22,002 million, or 42.5%, from ¥51,781 million for the three months ended December 31, 2007 to ¥29,779 million for the three months ended December 31, 2008. The main reasons for this decrease were due primarily to the change in the exchange rate and a rapid decrease in the demand of hard disk drives spindle motors and other small precision motors. External revenues of NCJ decreased ¥10,603 million, or 44.4%, from ¥23,894 million for the three months ended December 31, 2007 to ¥13,291 million for the three months ended December 31, 2008. Operating profit of NCJ decreased ¥4,346 million, or 90.3%, from ¥4,814 million for the three months ended December 31, 2007 to ¥468 million for the three months ended December 31, 2008. This decrease was due primarily to a rapid decrease in sales of hard disk drives spindle motors.
Net sales of NET decreased ¥13,189 million, or 35.6%, from ¥37,043 million for the three months ended December 31, 2007 to ¥23,854 million for the three months ended December 31, 2008 due primarily to the change in the exchange rate and a rapid decrease in the demand of hard disk drives spindle motors by a world wide recession. Operating profit decreased ¥21 million, or 0.5%, from ¥3,969 million for the three months ended December 31, 2007 to ¥3,948 million for the three months ended December 31, 2008. This was due primarily to the change in the exchange rate, despite a reduction of fixed cost.
Net sales of NCC decreased ¥1,942 million, or 30.1%, from ¥6,448 million for the three months ended December 31, 2007 to ¥4,506 million for the three months ended December 31, 2008. The main reasons for this decrease were due primarily to the change in the exchange rate and a rapid decrease in the demand of hard disk drives spindle motors. NCC had operating profit of ¥260 million for the three months ended December 31, 2007 and operating loss of ¥211 million for the three months ended December 31, 2008. This was due primarily to a rapid decrease in sales of hard disk drives spindle motors.
Net sales of NCD decreased ¥5,548 million, or 45.2%, from ¥12,285 million for the three months ended December 31, 2007 to ¥6,737 million for the three months ended December 31, 2008. The main reasons for this decrease were due primarily to the change in the exchange rate and a rapid decrease in the demand of small precision motors. Operating profit decreased ¥663 million, or 57.4%, from ¥1,156 million for the three months ended December 31, 2007 to ¥493 million for the three months ended December 31, 2008. This was due primarily to a rapid decrease in sales of the products with higher margins.
Net sales of NCS decreased ¥7,269 million, or 57.4%, from ¥12,656 million for the three months ended December 31, 2007 to ¥5,387 million for the three months ended December 31, 2008, resulting primarily from a decrease in sales of hard disk drives spindle motors to a main customer, which transferred its production from Singapore to China and Thailand. Operating profit decreased ¥354 million, or 86.6%, from ¥409 million for the three months ended December 31, 2007 to ¥55 million for the three months ended December 31, 2008. This was due primarily to a decrease in sales of hard disk drives spindle motors manufactured by NCS along with the transfer of its manufacturing to other subsidiaries.
Net sales of NCH decreased ¥1,611 million, or 12.9%, from ¥12,483 million for the three months ended December 31, 2007 to ¥10,872 million for the three months ended December 31, 2008. This decrease was due primarily to the change in the exchange rate. Operating profit decreased ¥43 million, or 23.5%, from ¥183 million for the three months ended December 31, 2007 to ¥140 million for the three months ended December 31, 2008. This decrease was due primarily to the change in the exchange rate.
Net sales of NCF decreased ¥6,365 million, or 50.6%, from ¥12,574 million for the three months ended December 31, 2007 to ¥6,209 million for the three months ended December 31, 2008. The major reason for this decrease was a rapid decrease in the demand of hard disk drives spindle motors. Operating profit decreased ¥678 million, or 58.3%, from ¥1,163 million for the three months ended December 31, 2007 to ¥485 million for the three months ended December 31, 2008. The major reasons for this decrease were due mainly to a rapid decrease in sales of hard disk drives spindle motors and a delay in cost reduction of new models.
18
Net sales of NSNK increased ¥2,416 million, or 16.4%, from ¥14,701 million for the three months ended December 31, 2007 to ¥17,117 million for the three months ended December 31, 2008. This was due primarily to an increase in sales of LCD panel handling robots, despite a decrease in sales of electronic components and cardreaders. However, operating profit decreased ¥193 million, or 16.1%, from ¥1,197 million for the three months ended December 31, 2007 to ¥1,004 million for the three months ended December 31, 2008. The major reason for this decrease was a decrease in sales of electronic components and cardreaders, despite the increase in sales of robots.
Net sales of NCPL decreased ¥3,836 million, or 21.1%, from ¥18,185 million for the three months ended December 31, 2007 to ¥14,349 million for the three months ended December 31, 2008. This was due primarily to a decrease in the demand of products related to digital cameras and camera shutters for mobile phones. Operating profit decreased ¥409 million, or 57.1%, from ¥716 million for the three months ended December 31, 2007 to ¥307 million for the three months ended December 31, 2008. This was due primarily to a decrease in sales of products related to digital cameras and camera shutters for mobile phones.
Net sales of NTSC decreased ¥1,101 million, or 16.4%, from ¥6,702 million for the three months ended December 31, 2007 to ¥5,601 million for the three months ended December 31, 2008. This was due primarily to a decrease in sales of semiconductor manufacturing equipment due to the world wide recession. NTSC had operating profit of ¥521 million for the three months ended December 31, 2007 and operating loss of ¥14 million for the three months ended December 31, 2008. This was due primarily to a decrease in sales of semiconductor manufacturing equipment and a decrease in profitability in the auto parts.
Net sales of NCEL decreased ¥1,024 million, or 13.8%, from ¥7,412 million for the three months ended December 31, 2007 to ¥6,388 million for the three months ended December 31, 2008. This decrease was due primarily to a decrease in sales of actuators for the amusement machines and other electronic components. Operating profit decreased ¥803 million, or 62.6%, from ¥1,283 million for the three months ended December 31, 2007 to ¥480 million for the three months ended December 31, 2008. This was due primarily to a decrease in sales.
Net sales of NSRV decreased ¥2,750 million, or 35.0%, from ¥7,863 million for the three months ended December 31, 2007 to ¥5,113 million for the three months ended December 31, 2008. This was due primarily to a rapid decrease in the demand of small precision motors. NSRV had operating profit of ¥52 million for the three months ended December 31, 2007 and operating loss of ¥325 million for the three months ended December 31, 2008. This was due primarily to a rapid decrease in sales.
Net sales of NSBC decreased ¥750 million, or 16.1%, from ¥4,668 million for the three months ended December 31, 2007 to ¥3,918 million for the three months ended December 31, 2008. This was due primarily to a decrease in sales of mid-size motors due to the world wide recession. Operating loss increased ¥66 million, or 68.8%, from ¥96 million for the three months ended December 31, 2007 to ¥162 million for the three months ended December 31, 2008. This was due primarily to a delay in fixed cost reduction, despite a decrease in sales.
19
Net sales of NSCJ decreased ¥566 million, or 16.3%, from ¥3,473 million for the three months ended December 31, 2007 to ¥2,907 million for the three months ended December 31, 2008. This was due primarily to a decrease in sales of power transmission equipment due to the world wide recession. Operating profit decreased ¥255 million, or 81.2%, from ¥314 million for the three months ended December 31, 2007 to ¥59 million for the three months ended December 31, 2008. This was due primarily to a decrease in sales.
Net sales of NMA decreased ¥4,442 million or 50.3%, from ¥8,826 million for the three months ended December 31, 2007 to ¥4,384 million for the three months ended December 31, 2008 due primarily to a rapid decrease in the demand of automobiles due to the world wide recession. NMA had operating profit of ¥194 million for the three months ended December 31, 2007 and operating loss of ¥427 million for the three months ended December 31, 2008. This was due primarily to a rapid decrease in sales.
Net sales of NNSN decreased ¥521 million, or 17.4%, from ¥2,986 million for the three months ended December 31, 2007 to ¥2,465 million for the three months ended December 31, 2008. This decrease was primarily due to a decrease in sales of products related to engineering plastics and plastics for lens. Operating profit decreased ¥119 million, or 74.4%, from ¥160 million for the three months ended December 31, 2007 to ¥41 million for the three months ended December 31, 2008. This decrease was primarily due to a decrease in sales.
Within the All Others segment, net sales decreased ¥24,926 million, or 25.2% from ¥98,827 million for the three months ended December 31, 2007 to ¥73,901 million for the three months ended December 31, 2008. This decrease was primarily due to a decrease in many other segments by a world wide recession. Operating profit decreased ¥3,114 million, or 49.3%, from ¥6,312 million for the three months ended December 31, 2007 to ¥3,198 million for the three months ended December 31, 2008. This was due primarily to a decrease in sales.
Liquidity and Capital Resources
During the nine months ended December 31, 2008, our total assets decreased ¥11,602 million, or 1.7%, from ¥671,714 million to ¥660,112 million. The decrease of ¥11,602 million was due primarily to decreases from the following components:
・ Trade accounts receivable decreased ¥22,848 million due primarily to a decrease of net sales and the effect of exchange rate changes; and
・ Property, plant and equipment decreased ¥10,848 million due primarily to the effect of exchange rate changes and disposal of fixed assets derived from discontinued operations.
On the other hand, cash and cash equivalents increased ¥13,977 million due to the reason as mentioned below under “Cash Flows”.
During the nine months ended December 31, 2008, our total liabilities increased ¥22,454 million, or 7.9%, from ¥283,944 million to ¥306,398 million. The increase of ¥22,454 million was due mainly to an increase in short-term borrowings of ¥82,165 million owing to redemption of corporate bonds, purchase of treasury stock and marketable securities and additional investments in subsidiaries.
On the other hand, current portion of long-term debt decreased ¥27,223 million owing to redemption of corporate bonds. In addition, trade notes and accounts payable decreased ¥24,083 million due primarily to a decrease of purchases which was affected by the sales decrease and the effect of exchange rate changes.
During the nine months ended December 31, 2008, our working capital, defined as current assets less current liabilities, decreased ¥26,254 million, or 25.3%, from ¥103,899 million to ¥77,645 million.
20
During the nine months ended December 31, 2008, our total shareholders’ equity decreased ¥27,594 million, or 8.6%, from ¥319,584 million to ¥291,990 million. The decrease of ¥27,594 million was primarily due to foreign currency translation adjustments of ¥19,143 million owing to sharp appreciation of the yen, loan to shareholder of ¥14,500 million and purchase of treasury stock of ¥6,473 million. Those factors offset increases in retained earnings of ¥14,258 million. As a result, the ratio of stockholders’ equity to total assets decreased 3.4% from 47.6% as of March 31, 2008 to 44.2% as of December 31, 2008.
Cash Flows
Net cash provided by operating activities decreased ¥10,090 million from ¥57,285 million for the nine months ended December 31, 2007 to ¥47,195 million for the nine months ended December 31, 2008. Amid global economic crisis, the decreased cash inflows in operating activities were due primarily to the decreases in net income of ¥11,240 million and changes in operating assets and liabilities of ¥612 million, resulted from a decrease in net sales. The ¥612 million consisted of the decrease in operating assets of ¥24,604 million and notes and accounts payable of ¥25,216 million. On the other hand, the increase in foreign currency adjustments of ¥7,096 million was due mainly to the sharp appreciation of the yen.
Net cash used in investing activities increased ¥12,906 million from ¥32,887 million for the nine months ended December 31, 2007 to ¥45,793 million for the nine months ended December 31, 2008. The increased cash outflows in investing activities were due primarily to an increase in additions to property, plant and equipment of ¥5,305 million, purchases of marketable securities of ¥3,500 million and payments for additional investments in subsidiaries of ¥1,265 million.
Net cash provided by financing activities was ¥24,497 million for the nine months ended December 31, 2008 while net cash used in financing activities was ¥22,100 million for the nine months ended December 31, 2007. The increased cash inflows of ¥46,597 million in financing activities were due mainly to an increase in short-term borrowings of ¥95,473 million. The increase in short-term borrowings offset redemption of corporate bonds of ¥26,412 million, payment for loan to shareholder of ¥14,500 million, purchases of treasury stock of ¥6,456 million and an increase in dividends paid of ¥1,457 million.
As a result of the foregoing factors and the effect of exchange rate changes, our total outstanding balance of cash and cash equivalents increased ¥13,977 million from ¥100,809 million as of March 31, 2008 to ¥114,786 million as of December 31, 2008.
21
NIDEC CORPORATION
CONSOLIDATED BALANCE SHEETS
ASSETS
(Unaudited)
Yen in millions | U.S. dollars in thousands | ||||||||
2008 | December 31, | ||||||||
March 31 | December 31 | 2008 | |||||||
Current assets: | |||||||||
Cash and cash equivalents | ¥ 100,809 | ¥ 114,786 | $ 1,260,969 | ||||||
Trade notes and accounts receivable, net of allowance for doubtful accounts of ¥795 million at March 31, 2008 and ¥466 million ($5,119 thousand) at December 31, 2008 | |||||||||
Notes | 17,205 | 18,236 | 200,330 | ||||||
Accounts | 148,928 | 126,080 | 1,385,038 | ||||||
Inventories: | |||||||||
Finished goods | 32,735 | 35,081 | 385,378 | ||||||
Raw materials | 17,849 | 17,464 | 191,849 | ||||||
Work in progress | 16,164 | 16,812 | 184,686 | ||||||
Project in progress | 816 | 1,205 | 13,237 | ||||||
Supplies and other | 2,254 | 2,140 | 23,509 | ||||||
Other current assets | 20,238 | 24,094 | 264,682 | ||||||
Total current assets | 356,998 | 355,898 | 3,909,678 | ||||||
Marketable securities, other securities investments and other investments | 15,485 | 13,648 | 149,929 | ||||||
Investments in and advances to affiliated companies | 2,102 | 1,634 | 17,950 | ||||||
17,587 | 15,282 | 167,879 | |||||||
Property, plant and equipment: | |||||||||
Land | 39,389 | 39,220 | 430,847 | ||||||
Buildings | 110,258 | 108,695 | 1,194,057 | ||||||
Machinery and equipment | 264,019 | 247,476 | 2,718,620 | ||||||
Construction in progress | 11,309 | 13,305 | 146,161 | ||||||
424,975 | 408,696 | 4,489,685 | |||||||
Less - Accumulated depreciation | (226,146 | ) | (220,715 | ) | (2,424,640 | ) | |||
198,829 | 187,981 | 2,065,045 | |||||||
Goodwill | 71,223 | 73,675 | 809,349 | ||||||
Other non-current assets, net of allowance for doubtful accounts of ¥1,451 million at March 31, 2008 and ¥1,595 million ($17,522 thousand) at December 31, 2008 | 27,077 | 27,276 | 299,636 | ||||||
Total assets | ¥ 671,714 | ¥ 660,112 | $ 7,251,587 | ||||||
The accompanying notes are an integral part of these financial statements.
22
NIDEC CORPORATION
CONSOLIDATED BALANCE SHEETS
LIABILITIES AND SHAREHOLDERS’ EQUITY
(Unaudited)
Yen in millions | U.S. dollars in thousands | ||||||||
2008 | December 31, | ||||||||
March 31 | December 31 | 2008 | |||||||
Current liabilities: | |||||||||
Short-term borrowings | ¥ 68,854 | ¥ 151,019 | $ 1,659,003 | ||||||
Current portion of long-term debt | 29,196 | 1,973 | 21,674 | ||||||
Trade notes and accounts payable | 121,698 | 97,615 | 1,072,339 | ||||||
Other current liabilities | 33,351 | 27,646 | 303,702 | ||||||
Total current liabilities | 253,099 | 278,253 | 3,056,718 | ||||||
Long-term liabilities: | |||||||||
Long-term debt | 3,430 | 2,735 | 30,045 | ||||||
Accrued pension and severance costs | 14,953 | 14,154 | 155,487 | ||||||
Other long-term liabilities | 12,462 | 11,256 | 123,651 | ||||||
Total long-term liabilities | 30,845 | 28,145 | 309,183 | ||||||
Minority interest in consolidated subsidiaries | 68,186 | 61,724 | 678,062 | ||||||
Commitments and contingencies (Note 7) | |||||||||
Shareholders’ equity: | |||||||||
Common stock authorized: 480,000,000 shares issued and outstanding: 144,987,492 shares at March 31, 2008 and 145,075,080 shares at December 31, 2008 | 66,248 | 66,551 | 731,089 | ||||||
Additional paid-in capital | 68,859 | 69,162 | 759,772 | ||||||
Retained earnings | 193,407 | 207,665 | 2,281,280 | ||||||
Accumulated other comprehensive income | |||||||||
Foreign currency translation adjustments | (10,233 | ) | (29,376 | ) | (322,707 | ) | |||
Unrealized gains (losses) from securities, net | 1,016 | (1,094 | ) | (12,018 | ) | ||||
Pension liability adjustments | 568 | 336 | 3,691 | ||||||
Treasury stock, at cost: 47,495 shares at March 31, 2008 and 1,787,918 shares at December 31, 2008 | (281 | ) | (6,754 | ) | (74,195 | ) | |||
Loan to shareholder | - | (14,500 | ) | (159,288 | ) | ||||
Total shareholders’ equity | 319,584 | 291,990 | 3,207,624 | ||||||
Total liabilities and shareholders’ equity | ¥ 671,714 | ¥ 660,112 | $ 7,251,587 | ||||||
The accompanying notes are an integral part of these financial statements.
23
NIDEC CORPORATION
CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
Yen in millions | U.S. dollars in thousands | |||||||||
For the three months ended December 31 | For the three months ended December 31, | |||||||||
2007 | 2008 | 2008 | ||||||||
Net sales | ¥ 193,150 | ¥ 141,186 | $ 1,550,983 | |||||||
Operating expenses: | ||||||||||
Cost of products sold | 150,682 | 111,452 | 1,224,344 | |||||||
Selling, general and administrative expenses | 11,934 | 12,802 | 140,635 | |||||||
Research and development expenses | 7,416 | 6,894 | 75,733 | |||||||
170,032 | 131,148 | 1,440,712 | ||||||||
Operating income | 23,118 | 10,038 | 110,271 | |||||||
Other income (expense): | ||||||||||
Interest and dividend income | 557 | 771 | 8,470 | |||||||
Interest expense | (372 | ) | (347 | ) | (3,812 | ) | ||||
Foreign exchange loss, net | (1,008 | ) | (12,828 | ) | (140,921 | ) | ||||
(Loss) gain on marketable securities, net | (2 | ) | 127 | 1,395 | ||||||
Other, net | (100 | ) | 161 | 1,769 | ||||||
(925 | ) | (12,116 | ) | (133,099 | ) | |||||
Income (loss) from continuing operations before income taxes | 22,193 | (2,078 | ) | (22,828 | ) | |||||
Income taxes | (5,923 | ) | (171 | ) | (1,878 | ) | ||||
Income (loss) from continuing operations before minority interest and equity in earnings of affiliated companies | 16,270 | (2,249 | ) | (24,706 | ) | |||||
Minority interest in income of consolidated subsidiaries | 2,333 | 195 | 2,142 | |||||||
Equity in net income of affiliated companies | (18 | ) | (16 | ) | (175 | ) | ||||
Income (loss) from continuing operations | 13,955 | (2,428 | ) | (26,673 | ) | |||||
Loss on discontinued operations | (9 | ) | (2,349 | ) | (25,804 | ) | ||||
Net income (loss) | ¥ 13,946 | ¥ (4,777 | ) | $ (52,477 | ) | |||||
Yen | U.S. dollars | |||||||||
Per share data: | ||||||||||
Earning per share - basic | ||||||||||
Income (loss) from continuing operations | ¥ 96.28 | ¥ (16.85 | ) | $ (0.18 | ) | |||||
Loss on discontinued operations | (0.06 | ) | (16.31 | ) | (0.18 | ) | ||||
Net income (loss) | 96.22 | (33.16 | ) | (0.36 | ) | |||||
Earning per share - diluted | ||||||||||
Income (loss) from continuing operations | 93.68 | (16.85 | ) | (0.18 | ) | |||||
Loss on discontinued operations | (0.06 | ) | (16.31 | ) | (0.18 | ) | ||||
Net income (loss) | 93.62 | (33.16 | ) | (0.36 | ) | |||||
Cash dividends | ¥ 25.00 | ¥ 30.00 | $ 0.33 |
The accompanying notes are an integral part of these financial statements.
24
NIDEC CORPORATION
CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
Yen in millions | U.S. dollars in thousands | |||||||||
For the nine months ended December 31 | For the nine months ended December 31, | |||||||||
2007 | 2008 | 2008 | ||||||||
Net sales | ¥ 549,221 | ¥ 506,406 | $ 5,563,067 | |||||||
Operating expenses: | ||||||||||
Cost of products sold | 430,944 | 393,811 | 4,326,167 | |||||||
Selling, general and administrative expenses | 38,396 | 40,270 | 442,382 | |||||||
Research and development expenses | 22,344 | 21,509 | 236,284 | |||||||
491,684 | 455,590 | 5,004,833 | ||||||||
Operating income | 57,537 | 50,816 | 558,234 | |||||||
Other income (expense): | ||||||||||
Interest and dividend income | 2,062 | 2,039 | 22,399 | |||||||
Interest expense | (1,879 | ) | (1,054 | ) | (11,579 | ) | ||||
Foreign exchange loss, net | (2,645 | ) | (10,155 | ) | (111,557 | ) | ||||
Gain from marketable securities, net | 117 | 70 | 769 | |||||||
Other, net | (1,077 | ) | (413 | ) | (4,536 | ) | ||||
(3,422 | ) | (9,513 | ) | (104,504 | ) | |||||
Income from continuing operations before income taxes | 54,115 | 41,303 | 453,730 | |||||||
Income taxes | (14,143 | ) | (11,337 | ) | (124,542 | ) | ||||
Income from continuing operations before minority interest and equity in earnings of affiliated companies | 39,972 | 29,966 | 329,188 | |||||||
Minority interest in income of consolidated subsidiaries | 5,386 | 4,270 | 46,907 | |||||||
Equity in net losses of affiliated companies | 7 | 78 | 857 | |||||||
Income from continuing operations | 34,579 | 25,618 | 281,424 | |||||||
Loss on discontinued operations | (276 | ) | (2,555 | ) | (28,068 | ) | ||||
Net income | ¥ 34,303 | ¥ 23,063 | $ 253,356 | |||||||
Yen | U.S. dollars | |||||||||
Per share data: | ||||||||||
Earning per share - basic | ||||||||||
Income from continuing operations | ¥ 238.63 | ¥ 177.08 | $ 1.94 | |||||||
Loss on discontinued operations | (1.90 | ) | (17.66 | ) | (0.19 | ) | ||||
Net income | 236.73 | 159.42 | 1.75 | |||||||
Earning per share - diluted | ||||||||||
Income from continuing operations | 232.13 | 173.25 | 1.90 | |||||||
Loss on discontinued operations | (1.85 | ) | (17.31 | ) | (0.19 | ) | ||||
Net income | 230.28 | 155.94 | 1.71 | |||||||
Cash dividends | ¥ 50.00 | ¥ 60.00 | $ 0.66 |
The accompanying notes are an integral part of these financial statements.
25
NIDEC CORPORATION
CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY
AND COMPREHENSIVE INCOME
(Unaudited)
Yen in millions | |||||||||||||||||||
Common stock | Additional paid-in capital | Retained earnings | Accumulated other comprehensive loss | Treasury stock, at cost | Loan to shareholder | Total | |||||||||||||
Shares | Amount | ||||||||||||||||||
Balance at March 31, 2008 | 144,987,492 | ¥66,248 | ¥68,859 | ¥193,407 | ¥(8,649 | ) | ¥(281) | - | ¥319,584 | ||||||||||
Effects of changing pension plan measurement date pursuant to SFAS No. 158, net of tax | (106 | ) | (5 | ) | (111 | ) | |||||||||||||
Comprehensive income: | |||||||||||||||||||
Net income | 23,063 | 23,063 | |||||||||||||||||
Other comprehensive income (loss): | |||||||||||||||||||
Foreign currency translation adjustments | (19,143 | ) | (19,143 | ) | |||||||||||||||
Unrealized losses on securities, net of reclassification adjustment | (2,110 | ) | (2,110 | ) | |||||||||||||||
Pension liability adjustments | (227 | ) | (227 | ) | |||||||||||||||
Total comprehensive income | 1,583 | ||||||||||||||||||
Dividends paid | (8,699 | ) | (8,699 | ) | |||||||||||||||
Conversion of convertible debt | 87,588 | 303 | 303 | 606 | |||||||||||||||
Purchase of treasury stock | (6,473) | (6,473 | ) | ||||||||||||||||
Payment for loan to shareholder | (14,500) | (14,500 | ) | ||||||||||||||||
Balance at December 31, 2008 | 145,075,080 | ¥66,551 | ¥ 69,162 | ¥207,665 | ¥(30,134 | ) | ¥(6,754) | ¥(14,500) | ¥291,990 | ||||||||||
U.S. dollars in thousands | |||||||||||||||||
Common Stock | Additional paid-in capital | Retained earnings | Accumulated other comprehensive loss | Treasury stock, at cost | Loan to shareholder | Total | |||||||||||
Balance at March 31, 2008 | $727,760 | $756,443 | $2,124,650 | $(95,013 | ) | $(3,087) | - | $3,510,753 | |||||||||
Effects of changing pension plan measurement date pursuant to SFAS No. 158, net of tax | (1,164 | ) | (55 | ) | (1,219 | ) | |||||||||||
Comprehensive income: | |||||||||||||||||
Net income | 253,356 | 253,356 | |||||||||||||||
Other comprehensive income (loss): | |||||||||||||||||
Foreign currency translation adjustments | (210,293 | ) | (210,293 | ) | |||||||||||||
Unrealized losses on securities, net of reclassification adjustment | (23,179 | ) | (23,179 | ) | |||||||||||||
Pension liability adjustments | (2,494 | ) | (2,494 | ) | |||||||||||||
Total comprehensive income | 17,390 | ||||||||||||||||
Dividends paid | (95,562 | ) | (95,562 | ) | |||||||||||||
Conversion of convertible debt | 3,329 | 3,329 | 6,658 | ||||||||||||||
Purchase of treasury stock | (71,108) | (71,108 | ) | ||||||||||||||
Payment for loan to shareholder | (159,288) | (159,288 | ) | ||||||||||||||
Balance at December 31, 2008 | $731,089 | $759,772 | $2,281,280 | $(331,034 | ) | $(74,195) | $(159,288) | $3,207,624 | |||||||||
The accompanying notes are an integral part of these financial statements.
26
NIDEC CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
Yen in millions | U.S. dollars in thousands | ||||||||
For the nine months ended December 31 | For the nine months ended December 31, | ||||||||
2007 | 2008 | 2008 | |||||||
Cash flows from operating activities: | |||||||||
Net income | ¥ 34,303 | ¥ 23,063 | $ 253,356 | ||||||
Adjustments to reconcile net income to net cash provided by operating activities: | |||||||||
Depreciation and amortization | 28,171 | 26,123 | 286,971 | ||||||
Gain from marketable securities, net | (117 | ) | (70 | ) | (769 | ) | |||
Loss on sales, disposal or impairment of property, plant and equipment | 341 | 554 | 6,086 | ||||||
Minority interest in income of consolidated subsidiaries | 5,232 | 3,302 | 36,274 | ||||||
Equity in net losses of affiliated companies | 7 | 78 | 857 | ||||||
Foreign currency adjustments | 1,707 | 8,803 | 96,704 | ||||||
Changes in operating assets and liabilities: | |||||||||
(Increase) decrease in notes and accounts receivable | (13,843 | ) | 14,781 | 162,375 | |||||
Increase in inventories | (2,286 | ) | (6,306 | ) | (69,274 | ) | |||
Increase (decrease) in notes and accounts payable | 7,665 | (17,551 | ) | (192,805 | ) | ||||
Other | (3,895 | ) | (5,582 | ) | (61,320 | ) | |||
Net cash provided by operating activities | 57,285 | 47,195 | 518,455 | ||||||
Cash flows from investing activities: | |||||||||
Additions to property, plant and equipment | (25,972 | ) | (31,277 | ) | (343,590 | ) | |||
Proceeds from sales of property, plant and equipment | 1,907 | 590 | 6,481 | ||||||
Payments for loans receivable | (160 | ) | (106 | ) | (1,164 | ) | |||
Collection of loans receivable | 146 | 109 | 1,197 | ||||||
Purchases of marketable securities | (107 | ) | (3,607 | ) | (39,624 | ) | |||
Proceeds from sales of marketable securities | 2,029 | 63 | 692 | ||||||
Acquisitions of consolidated subsidiaries, net of cash acquired | (2,618 | ) | (756 | ) | (8,305 | ) | |||
Payments for additional investments in subsidiaries | (6,604 | ) | (7,869 | ) | (86,444 | ) | |||
Other | (1,508 | ) | (2,940 | ) | (32,296 | ) | |||
Net cash used in investing activities | (32,887 | ) | (45,793 | ) | (503,053 | ) | |||
Cash flows from financing activities: | |||||||||
(Decrease) increase in short-term borrowings | (11,251 | ) | 84,222 | 925,211 | |||||
Proceeds from issuance of long-term debt | - | 88 | 967 | ||||||
Repayments of long-term debt | (2,523 | ) | (1,525 | ) | (16,753 | ) | |||
Redemption of corporate bonds | - | (26,412 | ) | (290,146 | ) | ||||
Proceeds from issuance of new shares | 761 | - | - | ||||||
Purchases of trasury stock | (17 | ) | (6,473 | ) | (71,108 | ) | |||
Payment for loan to shareholder | - | (14,500 | ) | (159,288 | ) | ||||
Dividends paid | (7,242 | ) | (8,699 | ) | (95,562 | ) | |||
Other | (1,828 | ) | (2,204 | ) | (24,212 | ) | |||
Net cash (used in) provided by financing activities | (22,100 | ) | 24,497 | 269,109 | |||||
Effect of exchange rate changes on cash and cash equivalents | (895 | ) | (11,922 | ) | (130,968 | ) | |||
Net increase in cash and cash equivalents | 1,403 | 13,977 | 153,543 | ||||||
Cash and cash equivalents at beginning of period | 88,784 | 100,809 | 1,107,426 | ||||||
Cash and cash equivalents at end of period | ¥ 90,187 | ¥ 114,786 | $ 1,260,969 |
The accompanying notes are an integral part of these financial statements.
27
NIDEC CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
1. Basis of preparation:
The accompanying interim condensed consolidated financial statements of NIDEC Corporation (the “Company”, and together with its consolidated subsidiaries, “NIDEC”) have been prepared in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”), however, certain footnotes required by U.S. GAAP have been omitted. The interim condensed consolidated financial statements are unaudited but include all adjustments, consisting of only normal recurring adjustments, which the Company considers necessary for a fair presentation of the consolidated financial position and the consolidated results of its operations and cash flows. Results for the nine months ended December 31, 2008 are not necessarily indicative of results that may be expected for the full year. The consolidated balance sheet at March 31, 2008, has been derived from the audited consolidated financial statements a t that date, but does not include all of the information required by U.S. GAAP for complete financial statements. For further information, refer to the audited consolidated financial statements and footnotes thereto for the year ended March 31, 2008, included on Form 20-F/A, filed with the Securities and Exchange Commission on December 24, 2008.
U.S. dollar amounts are included solely for the convenience of readers at the rate of ¥91.03 = US$1, the approximate current exchange rate at December 31, 2008.
Certain reclassifications in the consolidated balance sheets as of March 31, 2008, the consolidate statements of income for the three and nine months ended December 31, 2007 and the consolidated statements of cash flows for the nine months ended December 31, 2007 have been made to conform to the presentation used for the three and nine months ended December 31, 2008.
As of December 31, 2008, NIDEC discontinued its optical pickup unit (“OPU”) business. The results of the OPU business were previously recorded in the NSNK and All Others reporting segments. The operating results of the OPU business and exit costs with related taxes were recorded as “loss on discontinued operations” in the consolidated statement of income in accordance with Statement of Financial Accounting Standards No.144, “Accounting for the impairment or disposal of Long-Lived Assets”. All prior period information has been reclassified to be consistent with the current period presentation.
2. Goodwill and other intangible assets
Goodwill represents the excess of purchase price and related costs over the fair value of net assets of acquired businesses. Under SFAS No. 142 “Goodwill and Other Intangible Assets”, goodwill is not amortized but rather tested annually for impairment. If, between annual tests, an event, which would reduce the fair value below its carrying amount, occurs, NIDEC would recognize an impairment at such time.
Due to the discontinuation of the operations, an impairment loss of ¥360 million of goodwill in “All Others” segment was recorded as “loss on discontinued operations” in the consolidated statement of income in accordance with SFAS No.144, “Accounting for the impairment or disposal of Long-Lived Assets”.
28
NIDEC CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
The changes in the carrying amount of goodwill for the nine months ended December 31, 2008 are as follows:
Yen in millions | U.S dollars in thousands | ||||
Balance as of April 1, 2008 | ¥ 71,223 | $ 782,412 | |||
Acquired during nine months | 2,812 | 30,891 | |||
Impairment loss during nine months | (360 | ) | (3,954 | ) | |
Balance as of December 31, 2008 | ¥ 73,675 | $ 809,349 | |||
3. Earnings per share:
The tables below set forth a reconciliation of the differences between basic and diluted income (loss) per share for the three months and nine months ended December 31, 2007 and 2008:
Yen in millions | Thousands of shares | Yen | U.S. dollars | |||||||||
Net income (loss) | Weighted- average shares | Net income (loss) per share | Net income (loss) per share | |||||||||
For the three months ended December 31, 2007: | ||||||||||||
Basic net income (loss) per share | ||||||||||||
Income from continuing operations | ¥ 13,955 | 144,940 | ¥96.28 | |||||||||
Loss on discontinued operations | (9 | ) | 144,940 | (0.06 | ) | |||||||
Net income available to common shareholders | 13,946 | 144,940 | 96.22 | |||||||||
Effect of dilutive securities | ||||||||||||
Zero coupon 0.0% convertible bonds | - | 4,022 | ||||||||||
Diluted net income (loss) per share | ||||||||||||
Income from continuing operations | 13,955 | 148,962 | 93.68 | |||||||||
Loss on discontinued operations | (9 | ) | 148,962 | (0.06 | ) | |||||||
Net income for computation | ¥ 13,946 | 148,962 | ¥ 93.62 | |||||||||
For the three months ended December 31, 2008: | ||||||||||||
Basic net loss per share | ||||||||||||
Loss on continuing operations | ¥ (2,428 | ) | 144,098 | ¥ (16.85 | ) | $ (0.18 | ) | |||||
Loss on discontinued operations | (2,349 | ) | 144,098 | (16.31 | ) | (0.18 | ) | |||||
Net loss available to common shareholder | (4,777 | ) | 144,098 | (33.16 | ) | (0.36 | ) | |||||
Effect of dilutive securities | ||||||||||||
Zero coupon 0.0% convertible bonds | (3 | ) | 727 | |||||||||
Diluted net loss per share | ||||||||||||
Loss on continuing operations | (2,428 | ) | 144,098 | (16.85 | ) | (0.18 | ) | |||||
Loss on discontinued operations | (2,349 | ) | 144,098 | (16.31 | ) | (0.18 | ) | |||||
Net loss for computation | ¥ (4,777 | ) | 144,098 | ¥ (33.16 | ) | $ (0.36 | ) |
29
NIDEC CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(Continued)
(Unaudited)
Yen in millions | Thousands of shares | Yen | U.S. dollars | |||||||||
Net income (loss) | Weighted- average shares | Net income (loss) per share | Net income (loss) per share | |||||||||
For the nine months ended December 31, 2007: | ||||||||||||
Basic net income (loss) per share | ||||||||||||
Income from continuing operations | ¥ 34,579 | 144,906 | ¥ 238.63 | |||||||||
Loss on discontinued operations | (276 | ) | 144,906 | (1.90 | ) | |||||||
Net income available to common shareholders | 34,303 | 144,906 | 236.73 | |||||||||
Effect of dilutive securities | ||||||||||||
Zero coupon 0.0% convertible bonds | - | 4,022 | ||||||||||
Stock option | - | 34 | ||||||||||
Diluted net income (loss) per share | ||||||||||||
Income from continuing operations | 34,579 | 148,962 | 232.13 | |||||||||
Loss on discontinued operations | (276 | ) | 148,962 | (1.85 | ) | |||||||
Net income for computation | ¥ 34,303 | 148,962 | ¥ 230.28 | |||||||||
For the nine months ended December 31, 2008: | ||||||||||||
Basic net income (loss) per share | ||||||||||||
Income from continuing operations | 25,618 | 144,669 | ¥ 177.08 | $ 1.94 | ||||||||
Loss on discontinued operations | (2,555 | ) | 144,669 | (17.66 | ) | (0.19 | ) | |||||
Net income available to common shareholder | 23,063 | 144,669 | 159.42 | 1.75 | ||||||||
Effect of dilutive securities | ||||||||||||
Zero coupon 0.0% convertible bonds | (48 | ) | 2,919 | |||||||||
Diluted net income (loss) per share | ||||||||||||
Income from continuing operations | 25,570 | 147,588 | 173.25 | 1.90 | ||||||||
Loss on discontinued operations | (2,555 | ) | 147,588 | (17.31 | ) | (0.19 | ) | |||||
Net income for computation | ¥ 23,015 | 147,588 | ¥ 155.94 | $ 1.71 |
4. Summarized income statement information for affiliated companies:
Summarized financial information for affiliated companies accounted for by the equity method is shown below:
Yen in millions | U.S. dollars in thousands | |||||||
For the nine months ended December 31 | For the nine months ended December 31, | |||||||
2007 | 2008 | 2008 | ||||||
Net revenue | ¥ 12,374 | ¥ 9,659 | $ 106,108 | |||||
Gross profit | ¥ 1,037 | ¥ 738 | $ 8,107 | |||||
Net income | ¥ 15 | ¥ (263 | ) | $ (2,889 | ) | |||
30
NIDEC CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(Continued)
(Unaudited)
5. Pension and severance plans:
The amounts of net periodic benefit cost in pension and severance plans for the nine months ended December 31, 2007 and 2008 were as follows:
Yen in millions | U.S. dollars in thousands | ||||||||
For the nine months ended December 31 | For the nine months ended December 31, | ||||||||
2007 | 2008 | 2008 | |||||||
Service cost | ¥ 908 | ¥ 1,122 | $ 12,326 | ||||||
Interest cost | 419 | 433 | 4,757 | ||||||
Expected return on plan assets | (149 | ) | (118 | ) | (1,296 | ) | |||
Amortization of net actuarial gain | (3 | ) | (8 | ) | (88 | ) | |||
Amortization of prior service cost | (47 | ) | (47 | ) | (516 | ) | |||
Cost for defined contribution plans and others | 458 | 445 | 4,887 | ||||||
Net periodic pension cost | ¥ 1,586 | ¥ 1,827 | $ 20,070 | ||||||
As of April 1, 2008, NIDEC adopted the measurement date provision of SFAS No. 158. In accordance with this provision, the measurement dates of some of the benefit pension plans were changed to the date of the employer's fiscal year-end from within the three months prior to the year-end. By the application of the second approach described in the paragraph 19 of SFAS No. 158, at the beginning of this fiscal year, accrued pension and severance costs increased by ¥225 million. Furthermore, retained earnings, net of tax were reduced by ¥106 million and accumulated other comprehensive income, net of tax was reduced by ¥5 million.
6. Income taxes:
NIDEC is subject to a number of different income taxes, which, in the aggregate, indicate statutory rates in Japan of approximately 41.0% for the nine months ended December 31, 2007 and 2008. Reconciliation of the differences between the statutory tax rates and the estimated effective income tax rates is as follows:
For the nine months ended December 31 | |||||
2007 | 2008 | ||||
Statutory tax rate | 41.0 | % | 41.0 | % | |
Increase (reduction) in taxes resulting from: | |||||
Difference in statutory tax rate of foreign subsidiaries | (16.9 | ) | (21.5 | ) | |
Tax on undistributed earnings | 0.6 | (0.3 | ) | ||
Valuation allowance | 2.5 | 4.8 | |||
Liabilities for unrecognized tax benefits | - | 2.8 | |||
Other | (1.1 | ) | 0.6 | ||
Estimated effective income tax rate | 26.1 | % | 27.4 | % | |
31
NIDEC CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(Continued)
(Unaudited)
The estimated effective income tax rate for the nine months ended December 31, 2008 was higher compared to the corresponding prior period. This was mainly due to the net impact of an increase in the impact of difference in the tax rates of foreign subsidiaries offset by increases in valuation allowance and in adoption of FIN No.48, Accounting for Uncertainty in Income Taxes.
7. Contingencies:
Contingent liabilities for guarantees given in the ordinary course of business amounted to approximately ¥223 million ($2,450 thousand) at December 31, 2008.
NIDEC has guaranteed approximately ¥223 million ($2,450 thousand) of bank loans for employees in connection with their housing costs. If an employee defaults on his/her loan payments, NIDEC would be required to perform under the guarantee.
The undiscounted maximum amount of NIDEC’s obligation to make future payments in the event of defaults is approximately ¥223 million ($2,450 thousand). The current carrying amount of the liabilities for our obligations under the guarantee is zero.
8. Discontinued Operations
As of December 31, 2008, NIDEC discontinued its optical pickup unit (“OPU”) business. The results of the OPU business were previously recorded in the NSNK and All Others reporting segments. NIDEC discontinued the OPU business by winding down operations in an effort to concentrate management resources and focus capital and R&D expenditures on other growing businesses. Total exit costs were ¥3,740 million (net of tax ¥2,431 million), which includes an impairment loss of ¥360 million of goodwill, loss on disposal of fixed assets and inventories, and other closing costs. The operating results of the OPU business and exit costs with related taxes were recorded as “loss on discontinued operations” in the consolidated statement of income in accordance with Statement of Financial Accounting Standards No.144, “Accounting for the impairment or disposal of Long-Lived Assets”. All prior period information has been reclassified to be consistent with the current period presentation.
Operating results of discontinued operations for the three months and the nine months ended December 31, 2007 and 2008 were as follows:
32
NIDEC CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(Continued)
(Unaudited)
Yen in millions | U.S. dollars in thousands | ||||||||
For the three months ended December 31 | For the three months ended December 31, | ||||||||
2007 | 2008 | 2008 | |||||||
Net sales | ¥ 3,137 | ¥ 1,260 | $ 13,842 | ||||||
Loss on discontinued operations before income taxes | (47 | ) | (4,755 | ) | (52,235 | ) | |||
Income taxes | 36 | 1,543 | 16,951 | ||||||
Minority interest in loss of consolidated subsidiaries | (2 | ) | (863 | ) | (9,480 | ) | |||
Loss on discontinued operations | ¥ (9 | ) | ¥ (2,349 | ) | $ (25,804 | ) | |||
Yen in millions | U.S. dollars in thousands | ||||||||
For the nine months ended December 31 | For the nine months ended December 31, | ||||||||
2007 | 2008 | 2008 | |||||||
Net sales | ¥ 9,767 | ¥ 7,698 | $ 84,566 | ||||||
Loss on discontinued operations before income taxes | (463 | ) | (5,079 | ) | (55,795 | ) | |||
Income taxes | 33 | 1,556 | 17,093 | ||||||
Minority interest in loss of consolidated subsidiaries | (154 | ) | (968 | ) | (10,634 | ) | |||
Loss on discontinued operations | ¥ (276 | ) | ¥ (2,555 | ) | $ (28,068 | ) | |||
33
NIDEC CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(Continued)
(Unaudited)
9. Related Party Transactions
Loan to shareholder-
In December 2008, the Company advanced a loan of ¥14,500 million to a company indirectly owned by the Chief Executive Officer (“CEO”) that is involved in asset management (the “Borrower”). The loan was guaranteed by the CEO and collateralized by a pledge of 4,500,000 of the CEO’s shares in NIDEC. The loan had a term of 5 years and accrued interest quarterly at an annual rate of 2.4%. The loan was repaid in full on February 17, 2009. As of December 31, 2008, the loan receivable was recorded in the balance sheet in equity as “Loan to shareholder” and is presented as a financing activity in the Cash Flow Statement.
The Borrower obtained the funds to repay the loan through the sale of a total of 3,356,000 of its shares in NIDEC through the J-NET and on the Osaka Securities Exchange. Of these shares, 2,917,800 were purchased by the Company through the J-NET for a total of ¥12,867 million. See Note 11. Upon repayment, the Company released from pledge the shares that had collateralized the loan.
The loan was repaid shortly after the Company and the CEO determined that the loan was not permitted under Section 402 of the U.S. Sarbanes-Oxley Act of 2002. A special committee of the Company’s Board of Corporate Auditors conducted an independent investigation of this matter with the assistance of independent counsel and concluded that the failure to comply with Section 402 was inadvertent. At the recommendation of the Board of Corporate Auditors, however, the Company has adopted and is in the process of implementing certain procedures and protocols to strengthen internal controls and corporate governance, and has voluntarily brought this matter to the attention of the U.S. Securities and Exchange Commission.
During the period the loan was outstanding, the Borrower qualified as a variable interest entity in accordance with FIN 46(R), “Consolidation of Variable Interest Entities – an interpretation of ARB No. 51.” NIDEC was not the primary beneficiary. NIDEC had no other material arrangements with the entity.
34
NIDEC CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(Continued)
(Unaudited)
10. Segment data:
In accordance with SFAS No. 144, “Accounting for the Impairment or Disposal of Long-Lived Assets”, amounts in the segment information do not reflect discontinued operations, and previous fiscal year’s segment information has been reclassified to conform to the current presentation.
(1) Enterprise-wide information
The following table provides product information for the three months ended December 31, 2007 and 2008:
Yen in millions | U.S. dollars in thousands | ||||||||
For the three months ended December 31 | For the three months ended December 31, | ||||||||
2007 | 2008 | 2008 | |||||||
Net sales: | |||||||||
Small precision motors: | |||||||||
Hard disk drives spindle motors | ¥ 63,089 | ¥ 37,533 | $ 412,315 | ||||||
Other small precision brushless DC motors | 24,494 | 16,331 | 179,402 | ||||||
Brushless DC fans | 12,592 | 8,948 | 98,297 | ||||||
Other small precision motors | 6,844 | 5,821 | 63,946 | ||||||
Sub total | 107,019 | 68,633 | 753,960 | ||||||
Mid-size motors | 23,268 | 15,898 | 174,646 | ||||||
Machinery | 18,161 | 19,714 | 216,566 | ||||||
Electronic and optical components | 37,578 | 29,784 | 327,189 | ||||||
Others | 7,124 | 7,157 | 78,622 | ||||||
Consolidated total | ¥ 193,150 | ¥ 141,186 | $ 1,550,983 |
The following table provides product information for the nine months ended December 31, 2007 and 2008:
Yen in millions | U.S. dollars in thousands | ||||||||
For the nine months ended December 31 | For the nine months ended December 31, | ||||||||
2007 | 2008 | 2008 | |||||||
Net sales: | |||||||||
Small precision motors: | |||||||||
Hard disk drives spindle motors | ¥ 171,192 | ¥ 147,358 | $ 1,618,785 | ||||||
Other small precision brushless DC motors | 70,103 | 61,638 | 677,117 | ||||||
Brushless DC fans | 36,764 | 31,369 | 344,601 | ||||||
Other small precision motors | 17,267 | 18,211 | 200,055 | ||||||
Sub total | 295,326 | 258,576 | 2,840,558 | ||||||
Mid-size motors | 70,941 | 63,500 | 697,572 | ||||||
Machinery | 53,130 | 60,321 | 662,650 | ||||||
Electronic and optical components | 110,055 | 101,298 | 1,112,798 | ||||||
Others | 19,769 | 22,711 | 249,489 | ||||||
Consolidated total | ¥ 549,221 | ¥ 506,406 | $ 5,563,067 |
35
NIDEC CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(Continued)
(Unaudited)
(2) Operating segment information
We evaluate our financial performance based on segmental profit and loss, which consists of sales and operating revenues less operating expenses. Segmental profit or loss is determined using the accounting principles in the segment’s country of domicile. NIDEC Corporation, or NCJ, Nidec Sankyo Corporation, or NSNK, Nidec Copal Corporation, or NCPL, Nidec Tosok Corporation, or NTSC, Nidec Copal Electronics Corporation, or NCEL, Nidec Servo Corporation, or NSRV, Nidec Shibaura Corporation, or NSBC, Nidec-Shimpo Corporation or NSCJ, and Nidec Nissin Corporation or NNSN apply Japanese GAAP; Nidec Electronics (Thailand) Co., Ltd., or NET, applies Thai accounting principles; Nidec (Zhejiang) Corporation, or NCC and Nidec (Dalian) Limited, or NCD, applies Chinese accounting principles; Nidec Singapore Pte. Ltd., or NCS, applies Singaporean accounting principles; Nidec (H.K.) Co., Ltd., or NCH, applies Hong Kong accounting principles ; Nidec Philippines Corporation, or NCF, applies Philippine accounting principles; Nidec Motors & Actuators group, or NMA mainly applies International Financial Reporting Standards (IFRS).
As a result, our segmental data has not been prepared under U.S. GAAP on a basis that is consistent with our consolidated financial statements or on any other single basis that is consistent between segments. While there are several differences between U.S. GAAP and the underlying accounting principles used by the sixteen operating segments, the principal differences that affect segmental operating profit or loss are accounting for pension and severance costs and leases. We believe that the monthly segmental information is available on a timely basis and that it is sufficiently accurate at the segment profit and loss level for us to manage our business.
36
NIDEC CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(Continued)
(Unaudited)
The following tables show revenue from external customers and other financial information by operating segment for the three months and nine months ended December 31, 2007 and 2008, respectively:
Business segment
Yen in millions | U.S. dollars in thousands | ||||||||
For the three months ended December 31 | For the three months ended December 31, | ||||||||
Revenue from external customers: | 2007 | 2008 | 2008 | ||||||
NCJ | ¥ 23,894 | ¥ 13,291 | $ 146,007 | ||||||
NET | 27,820 | 15,869 | 174,327 | ||||||
NCC | 3,299 | 4,048 | 44,469 | ||||||
NCD | 1,064 | 1,350 | 14,830 | ||||||
NCS | 12,581 | 5,334 | 58,596 | ||||||
NCH | 11,076 | 9,458 | 103,900 | ||||||
NCF | 1,665 | 1,846 | 20,279 | ||||||
NSNK | 11,647 | 14,322 | 157,333 | ||||||
NCPL | 16,364 | 12,244 | 134,505 | ||||||
NTSC | 6,639 | 5,565 | 61,134 | ||||||
NCEL | 6,366 | 4,972 | 54,619 | ||||||
NSRV | 6,927 | 4,350 | 47,786 | ||||||
NSBC | 3,928 | 3,208 | 35,241 | ||||||
NSCJ | 2,836 | 2,399 | 26,354 | ||||||
NMA | 8,709 | 4,379 | 48,105 | ||||||
NNSN | 2,788 | 2,334 | 25,640 | ||||||
All Others | 42,590 | 31,333 | 344,206 | ||||||
Total | 190,193 | 136,302 | 1,497,331 | ||||||
Consolidated adjustments related to elimination of intercompany transactions via third party | 0 | 0 | 0 | ||||||
Others *1 | 2,957 | 4,884 | 53,652 | ||||||
Consolidated total | ¥ 193,150 | ¥ 141,186 | $ 1,550,983 | ||||||
*1 The revenues of subsidiaries not included in management reports due to their immateriality are main components of Others.
37
NIDEC CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(Continued)
(Unaudited)
Business segment
Yen in millions | U.S. dollars in thousands | ||||||||
For the nine months ended December 31 | For the nine months ended December 31, | ||||||||
Revenue from external customers: | 2007 | 2008 | 2008 | ||||||
NCJ | ¥ 71,329 | ¥ 49,745 | $ 546,468 | ||||||
NET | 71,092 | 65,672 | 721,432 | ||||||
NCC | 10,696 | 14,996 | 164,737 | ||||||
NCD | 3,231 | 6,336 | 69,603 | ||||||
NCS | 34,468 | 22,826 | 250,752 | ||||||
NCH | 30,178 | 30,988 | 340,415 | ||||||
NCF | 4,333 | 6,414 | 70,460 | ||||||
NSNK | 33,403 | 41,480 | 455,674 | ||||||
NCPL | 48,159 | 45,050 | 494,892 | ||||||
NTSC | 18,756 | 18,831 | 206,866 | ||||||
NCEL | 16,636 | 15,550 | 170,823 | ||||||
NSRV | 19,057 | 16,525 | 181,534 | ||||||
NSBC | 12,593 | 11,704 | 128,573 | ||||||
NSCJ | 8,305 | 7,650 | 84,038 | ||||||
NMA | 27,403 | 21,111 | 231,913 | ||||||
NNSN | 7,966 | 7,923 | 87,037 | ||||||
All Others | 126,941 | 111,933 | 1,229,629 | ||||||
Total | 544,546 | 494,734 | 5,434,846 | ||||||
Consolidated adjustments related to elimination of intercompany transactions via third party | (49 | ) | 0 | 0 | |||||
Others *1 | 4,724 | 11,672 | 128,221 | ||||||
Consolidated total | ¥ 549,221 | ¥ 506,406 | $ 5,563,067 | ||||||
*1 The revenues of subsidiaries not included in management reports due to their immateriality are main components of Others.
38
NIDEC CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(Continued)
(Unaudited)
Yen in millions | U.S. dollars in thousands | ||||||||
For the three months ended December 31 | For the three months ended December 31, | ||||||||
2007 | 2008 | 2008 | |||||||
Revenue from other operating segments: | |||||||||
NCJ | ¥ 27,887 | ¥ 16,488 | $ 181,127 | ||||||
NET | 9,223 | 7,985 | 87,718 | ||||||
NCC | 3,149 | 458 | 5,031 | ||||||
NCD | 11,221 | 5,387 | 59,178 | ||||||
NCS | 75 | 53 | 582 | ||||||
NCH | 1,407 | 1,414 | 15,533 | ||||||
NCF | 10,909 | 4,363 | 47,929 | ||||||
NSNK | 3,054 | 2,795 | 30,704 | ||||||
NCPL | 1,821 | 2,105 | 23,124 | ||||||
NTSC | 63 | 36 | 395 | ||||||
NCEL | 1,046 | 1,416 | 15,556 | ||||||
NSRV | 936 | 763 | 8,382 | ||||||
NSBC | 740 | 710 | 7,800 | ||||||
NSCJ | 637 | 508 | 5,581 | ||||||
NMA | 117 | 5 | 55 | ||||||
NNSN | 198 | 131 | 1,439 | ||||||
All Others | 56,237 | 42,568 | 467,627 | ||||||
Total | 128,720 | 87,185 | 957,761 | ||||||
Intersegment elimination | (128,720 | ) | (87,185 | ) | (957,761 | ) | |||
Consolidated total | - | - | - | ||||||
39
NIDEC CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(Continued)
(Unaudited)
Yen in millions | U.S. dollars in thousands | ||||||||
For the nine months ended December 31 | For the nine months ended December 31, | ||||||||
2007 | 2008 | 2008 | |||||||
Revenue from other operating segments: | |||||||||
NCJ | ¥ 76,211 | ¥ 61,057 | $ 670,735 | ||||||
NET | 24,464 | 24,542 | 269,603 | ||||||
NCC | 7,887 | 1,811 | 19,895 | ||||||
NCD | 35,294 | 24,015 | 263,814 | ||||||
NCS | 164 | 156 | 1,714 | ||||||
NCH | 3,305 | 4,565 | 50,148 | ||||||
NCF | 32,926 | 19,335 | 212,403 | ||||||
NSNK | 9,195 | 9,159 | 100,615 | ||||||
NCPL | 4,861 | 5,930 | 65,143 | ||||||
NTSC | 227 | 182 | 1,999 | ||||||
NCEL | 2,939 | 4,746 | 52,137 | ||||||
NSRV | 2,693 | 3,157 | 34,681 | ||||||
NSBC | 2,536 | 2,342 | 25,728 | ||||||
NSCJ | 1,889 | 1,598 | 17,555 | ||||||
NMA | 157 | 12 | 132 | ||||||
NNSN | 633 | 495 | 5,438 | ||||||
All Others | 167,812 | 155,794 | 1,711,457 | ||||||
Total | 373,193 | 318,896 | 3,503,197 | ||||||
Intersegment elimination | (373,193 | ) | (318,896 | ) | (3,503,197 | ) | |||
Consolidated total | - | - | - | ||||||
40
NIDEC CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(Continued)
(Unaudited)
Yen in millions | U.S. dollars in thousands | ||||||||
For the three months ended December 31 | For the three months ended December 31, | ||||||||
2007 | 2008 | 2008 | |||||||
Segment profit or loss: | |||||||||
NCJ | ¥ 4,814 | ¥ 468 | $ 5,141 | ||||||
NET | 3,969 | 3,948 | 43,370 | ||||||
NCC | 260 | (211 | ) | (2,318 | ) | ||||
NCD | 1,156 | 493 | 5,416 | ||||||
NCS | 409 | 55 | 604 | ||||||
NCH | 183 | 140 | 1,538 | ||||||
NCF | 1,163 | 485 | 5,328 | ||||||
NSNK | 1,197 | 1,004 | 11,029 | ||||||
NCPL | 716 | 307 | 3,373 | ||||||
NTSC | 521 | (14 | ) | (154 | ) | ||||
NCEL | 1,283 | 480 | 5,273 | ||||||
NSRV | 52 | (325 | ) | (3,570 | ) | ||||
NSBC | (96 | ) | (162 | ) | (1,780 | ) | |||
NSCJ | 314 | 59 | 648 | ||||||
NMA | 194 | (427 | ) | (4,691 | ) | ||||
NNSN | 160 | 41 | 451 | ||||||
All Others | 6,312 | 3,198 | 35,132 | ||||||
Total | 22,607 | 9,539 | 104,790 | ||||||
U.S. GAAP adjustments to accrue pension and severance costs | (119 | ) | (3 | ) | (33 | ) | |||
Consolidation adjustments mainly related to elimination of intercompany profits | 349 | 992 | 10,898 | ||||||
Reclassification *1 | 1,536 | (21 | ) | (231 | ) | ||||
Others *2 | (1,255 | ) | (469 | ) | (5,153 | ) | |||
Consolidated total | ¥ 23,118 | ¥ 10,038 | $ 110,271 | ||||||
*1 Some items are reclassified from other expenses (income) and included in operating expenses (income). Reclassification mainly includes gain (loss) from sales of fixed assets.
*2 Others mainly includes profit or loss of subsidiaries not included in management reports due to their immateriality and amortization of capitalized assets related to the business acquisition.
41
NIDEC CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(Continued)
(Unaudited)
Yen in millions | U.S. dollars in thousands | ||||||||
For the nine months ended December 31 | For the nine months ended December 31, | ||||||||
2007 | 2008 | 2008 | |||||||
Segment profit or loss: | |||||||||
NCJ | ¥ 11,751 | ¥ 6,847 | $ 75,217 | ||||||
NET | 8,895 | 13,006 | 142,876 | ||||||
NCC | 985 | 33 | 363 | ||||||
NCD | 3,817 | 2,611 | 28,683 | ||||||
NCS | 1,036 | 189 | 2,076 | ||||||
NCH | 454 | 490 | 5,383 | ||||||
NCF | 3,539 | 2,277 | 25,014 | ||||||
NSNK | 2,979 | 4,128 | 45,348 | ||||||
NCPL | 2,324 | 2,263 | 24,860 | ||||||
NTSC | 1,231 | 743 | 8,162 | ||||||
NCEL | 2,749 | 1,963 | 21,564 | ||||||
NSRV | 318 | (617 | ) | (6,778 | ) | ||||
NSBC | (100 | ) | (152 | ) | (1,670 | ) | |||
NSCJ | 892 | 433 | 4,757 | ||||||
NMA | 326 | (44 | ) | (483 | ) | ||||
NNSN | 405 | 307 | 3,373 | ||||||
All Others | 16,824 | 15,436 | 169,569 | ||||||
Total | 58,425 | 49,913 | 548,314 | ||||||
U.S. GAAP adjustments to accrue pension and severance costs | (367 | ) | (14 | ) | (154 | ) | |||
Consolidation adjustments mainly related to elimination of intercompany profits | (743 | ) | 878 | 9,645 | |||||
Reclassification *1 | 3,197 | (19 | ) | (209 | ) | ||||
Others *2 | (2,975 | ) | 58 | 638 | |||||
Consolidated total | ¥ 57,537 | ¥ 50,816 | $ 558,234 | ||||||
*1 Some items are reclassified from other expenses (income) and included in operating expenses (income). Reclassification mainly includes gains due to reversal of allowance for doubtful accounts for the period ended December 31, 2007 and gain (loss) from sales of fixed assets for the period ended December 31, 2008.
*2 Others mainly includes profit or loss of subsidiaries not included in management reports due to their immateriality and amortization of capitalized assets related to the business acquisition.
42
NIDEC CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(Continued)
(Unaudited)
11. Subsequent event:
Own share repurchase-
On February 12, 2009, NIDEC repurchased its own shares through Osaka Securities Exchange’s J-NET pursuant to a general authorization provided in a resolution under Article 459, Paragraph 1, Item 1 of the Company Law of Japan which was released on Form 6-K, furnished to the Securities and Exchange Commission on November 21, 2008. The resolution authorized the repurchase, until November 24, 2009, of up to 5,000,000 shares for a total of up to ¥25,000 million as a part of efforts to ensure a flexible capital structure responsive to the changing business environment.
The details of the repurchase are as follows:
1. Reason for share repurchase: | The repurchase was made to facilitate the Borrower’s sale of shares in NIDEC to obtain the funds necessary to repay the loan discussed in Note 9, and thereby bring the Company into compliance with Section 402 of the Sarbanes-Oxley Act of 2002 promptly. The share repurchase was within the parameters established in the resolution described above and the repurchase was structured in a manner intended to give all shareholders the opportunity to have their shares repurchased by the Company, on a pro rata basis, at the same time and at the same price. Accordingly, on February 10, 2009, the Company publicly announced its intention to repurchase on J-NET, on the morning of February 12, 2009, 3,500,000 shares at the closing price on the market on February 10, 2009. Based on the offers received, the Company repurchased 2,917,800 of its shares from the Borrower and 582,200 of its shares from other shareholders. |
2. Class of shares repurchased: | Common stock |
3. Total number of shares repurchased: | 3,500,000 shares |
4. Total amount of repurchase: | ¥15,435 million (representing the closing price of ¥4,410 per share on the Osaka Securities Exchange on February 10, 2009) |
5. Method of repurchase: | Repurchased through J-NET, the Osaka Securities Exchange |
43