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Financial Information:
Annual Report 2005
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Notes to Consolidated
Financial Statements |
| NSK Ltd. and Subsidiaries
For the year ended March 31, 2005 |
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4. Inventories
Inventories at March 31, 2005 and 2004 were as follows:
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Millions of yen |
Thousands of
U.S. dollars |
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| As of March 31, |
2005 |
2004 |
2005 |
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| Finished products |
¥44,571 |
¥42,891 |
$416,551 |
| Work in process |
22,655 |
19,292 |
211,729 |
| Raw materials and supplies |
14,504 |
13,720 |
135,551 |
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¥81,730 |
¥75,905 |
$763,832 |
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5. Depreciation
Depreciation of property, plant and equipment for the
years ended March 31, 2005 and 2004 amounted to ¥27,010 million ($252,430
thousand) and ¥26,597
million, respectively.
6. Short-Term Debt
At March 31, 2005 and 2004, short-term debt consisted of the following:
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Millions of yen |
Thousands of
U.S. dollars |
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| As of March 31, |
2005 |
2004 |
2005 |
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| Bank loans |
¥63,884 |
¥75,249 |
$597,047 |
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Short-term bank loans are principally unsecured and
consist of notes maturing generally within one year. The
interest rates applicable to the loans at March 31, 2005 and 2004 ranged
principally from 0.3892 percent to 8.50 percent
and from 0.3892 percent to 7.48 percent, respectively.
7. Income Taxes
Income taxes applicable to the Company and its domestic
subsidiaries comprise corporation tax, inhabitants’
taxes and enterprise tax which, in the aggregate, resulted
in statutory tax rates of 40.0 percent for 2005 and 42.0 percent for 2004.
Income taxes of the foreign subsidiaries
are based generally on the tax rates applicable in their
countries of incorporation.
The effective tax rate reflected in the consolidated statement of income for
the year ended March 31, 2005 differs from
the statutory tax rate for the following reasons:
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| Year ended March 31 |
2005 |
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| Statutory tax rate |
40.0% |
| Effect of: |
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Expenses not deductible for income tax purposes |
3.9 |
| Tax credits |
(1.2) |
| Different tax rates applied to income of foreign subsidiaries |
(1.5) |
| Changes in valuation allowance |
(6.4) |
| Equity in earnings of affiliated companies |
(3.5) |
| Other, net |
1.8 |
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| Effective tax rate |
33.1% |
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The difference between the effective tax rate and the
statutory tax rate reflected in the accompanying consolidated
statement of income for the year ended March 31,
2004 is less than 5% and, therefore, no reconciliation has
been disclosed.
The significant components of deferred tax assets and liabilities as of March
31, 2005 and 2004 were as follows:
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Millions of yen |
Thousands of
U.S. dollars |
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| As of March 31, |
2005 |
2004 |
2005 |
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| Deferred tax assets: |
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Accrued retirement benefits |
¥15,687 |
¥15,651 |
$146,607 |
| Property, plant and equipment |
1,823 |
2,042 |
17,037 |
| Accrual payroll expenses |
2,830 |
2,491 |
26,449 |
| Accrued bonuses |
3,576 |
3,377 |
33,421 |
| Net loss carryforward |
21,279 |
24,135 |
198,869 |
| Inventories |
1,322 |
1,387 |
12,355 |
| Loss on devaluation of investment securities |
703 |
910 |
6,570 |
| Other |
8,892 |
6,625 |
83,103 |
| Valuation allowance |
(24,029) |
(21,139) |
(224,570) |
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| Total deferred tax assets |
32,085 |
35,482 |
299,860 |
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| Deferred tax liabilities: |
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Depreciation |
4,572 |
5,108 |
42,729 |
| Unrealized holding gain on securities |
13,846 |
12,559 |
129,402 |
| Gain on contribution of securities to employees’ retirement
benefit trust |
13,818 |
13,601 |
129,140 |
| Other |
5,645 |
6,230 |
52,757 |
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| Total deferred tax liabilities |
37,883 |
37,499 |
354,047 |
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| Net deferred tax liabilities |
¥(5,797) |
¥(2,016) |
$(54,178) |
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8. Accrued Expenses and Other Current
Liabilities
At March 31, 2005 and 2004, accrued expenses and other current liabilities consisted
of the following:
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Millions of yen |
Thousands of
U.S. dollars |
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| As of March 31, |
2005 |
2004 |
2005 |
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| Accrued bonuses |
¥10,100 |
¥8,718 |
$94,393 |
| Dividends payable |
2,972 |
1,621 |
27,776 |
| Other |
32,195 |
30,419 |
300,888 |
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¥45,268 |
¥40,759 |
$423,065 |
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9. Long-Term Debt
At March 31, 2005 and 2004, long-term dept consisted of the following:
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Millions of yen |
Thousands of
U.S. dollars |
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| As of March 31, |
2005 |
2004 |
2005 |
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| Secured loans from banks, insurance companies and
others, |
| due through 2014 at interest rates ranging from
0.95 percent to 6.15 percent |
¥2,740 |
¥3,710 |
$25,607 |
| Unsecured loans from banks, insurance companies and others, |
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| due through 2020 at interest rates ranging from
0.72 percent to 9.00 percent |
60,560 |
60,598 |
565,981 |
| Unsecured yen convertible bonds: |
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| At an interest rate of 1.6 percent, due through 2005 |
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16,989 |
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| Unsecured yen bonds: |
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| At interest rates ranging from 0.86 percent to
3.6 percent, due through 2012 |
80,000 |
90,000 |
747,664 |
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143,300 |
171,298 |
1,339,252 |
| Less current portion |
(21,770) |
(39,157) |
(203,458) |
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¥121,529 |
¥132,141 |
$1,135,785 |
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The aggregate annual maturities of long-term debt subsequent to March 31, 2005
are summarized as follows:
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| Year ending March 31, |
Millions of yen |
Thousands of
U.S. dollars |
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| 2006 |
¥21,770 |
$203,458 |
| 2007 |
25,619 |
239,430 |
| 2008 |
33,114 |
309,477 |
| 2009 |
25,605 |
239,299 |
| 2010 and thereafter |
37,191 |
347,579 |
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¥143,300 |
$1,339,252 |
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The assets pledged as collateral for short-term debt, notes and accounts payable
and long-term debt at March 31, 2005
were as follows:
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| As of March 31, 2005 |
Millions of yen |
Thousands of
U.S. dollars |
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| Investment securities |
¥257 |
$2,402 |
| Property, plant and equipment, at net book value |
8,016 |
74,916 |
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¥8,274 |
$77,327 |
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