financial highlights 2001 - hitachi.com filecontents notes 1. hitachi’s fiscal year ends march 31....

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FINANCIAL HIGHLIGHTS 2001Year ended March 31, 2001

C h a n g e

Contents

Notes1. Hitachi’s fiscal year ends March 31.

2. Not all data have been audited.

3. Effective April 1, 1993, Hitachi, Ltd. adopted Statement of Financial Accounting Standards (SFAS) No. 109, “Accounting for Income Taxes,”

and has reported the cumulative effect of the change in the method of accounting for income taxes in the consolidated statement of

income for the fiscal year ended March 31, 1994. The cumulative effect of this change in accounting for income taxes of ¥2,970 million

is determined as of April 1, 1993.

4. In accordance with SFAS No. 109, the Company recognized the effect on deferred tax assets and liabilities of a change in income tax

rates in Japan, which resulted in a decrease in net income (loss) by ¥54,363 million and ¥27,053 million for the years ended March 31,

1999 and 1998.

5. The Company changed the method of carrying the investment in its certain affiliated company from cost to equity in 2000. Figures for the

fiscal years ended March 31, 1996 to 1999 have also been restated using the same method.

6. On April 1, 2000, the Company adopted SFAS No. 115, “Accounting for Certain Investments in Debt and Equity Securities.” Accordingly,

figures for the fiscal years ended March 31, 1996 to 2000 have been restated.

7. The merger of Hitachi Leasing, Ltd. (an affiliated company whose investment had been carried on the equity method) with Hitachi Credit

Corporation, a Hitachi subsidiary, effective on October 1, 2000, is assumed to have taken place on April 1, 2000. As a result, Hitachi

Leasing, Ltd. and its subsidiaries are consolidated as subsidiaries for the fiscal year ended March 31, 2001.

8. SFAS No. 87, “Employers’ Accounting for Pensions,” has been implemented for the fiscal year ended March 31, 2001.

Highlights of the Year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1

Corporate Data . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2

Main Products and Services . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3

Eleven-Year Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4

Consolidated Balance Sheets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6

Consolidated Statements of Income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10

Consolidated Statements of Cash Flows . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12

Segment Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14

Analysis of Operating Results . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16

Stock Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20

Major Consolidated Subsidiaries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22

1

Highlights of the YearHitachi, Ltd. and SubsidiariesYears ended March 31, 2000 and 2001

Millions of yen

2000 2001

For the year:Net sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥8,001,203 ¥ 8,416,982Operating income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 174,364 342,312Net income. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16,922 104,380Cash dividends declared . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20,026 36,716

At year-end:Total assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9,983,361 11,246,608Stockholders’ equity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,987,687 2,861,502

Yen

Per share data:Net income:

Basic . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥ 5.07 ¥ 31.27Diluted . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.99 30.32

Net income per ADS (representing 10 shares):Basic . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51 313Diluted . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50 303

Cash dividends declared . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.0 11.0Cash dividends declared per ADS (representing 10 shares) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60 110Stockholders’ equity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 895.08 857.27

See notes on inside cover.

2

Corporate DataAs of March 31, 2001

Corporate Name Hitachi, Ltd. (Kabushiki Kaisha Hitachi Seisakusho)

Principal Office 6, Kanda-Surugadai 4-chome,Chiyoda-ku, Tokyo 101-8010, Japan

Founded 1910 (Incorporated in 1920)

Number of Consolidated In Japan 734Subsidiaries Overseas 335

Number of Employees 340,939

Common Stock Par Value ¥50

Authorized 10,000,000,000 shares

Issued 3,337,931,857shares

Number of Shareholders 387,020

Internet Address http://global.hitachi.com

3

Main Products and Services

Information Systems & Electronics: Systems Integration, Software, RAID Storage Systems,Servers, PCs, Switches, Fiber Optic Components, DVD Drives, Semiconductors, LCDs, DisplayTubes, Semiconductor Manufacturing Equipment, Test and Measurement Equipment, MedicalElectronics Equipment

Power & Industrial Systems: Nuclear Power Plants, Hydroelectric Power Plants, Thermal PowerPlants, Control Equipment, Compressors, Rolling Mill Equipment, Plant Engineering andConstruction, Elevators, Escalators, Air-Conditioning Equipment, Rolling Stock, AutomotiveEquipment, Construction Machinery, Environmental Control Systems

Consumer Products: Room Air Conditioners, Refrigerators, Washing Machines, MicrowaveOvens, Vacuum Cleaners, Heating Appliances, Kitchen Appliances, Lighting Fixtures, TVs, VCRs,Mobile Phones, Audiotapes, Videotapes, Batteries, Optical Storage Media, Floppy Disks

Materials: Semiconductor Related Materials, Display Related Materials, Printed Circuit Boards,Synthetic Resin Materials, Housing Equipment, Specialty Steels, Rolls for Rolling Mills,Malleable Cast-Iron Products, Magnetic Materials, Pipe Fittings, Wires, Cables, Copper Products,Rubber Products

Services & Other: General Trading, Financial Services, Transportation, Property Management

Net Sales by Industry Segment

■ Information Systems & Electronics 32%■ Power & Industrial Systems 23%■ Consumer Products 9%■ Materials 13%■ Services & Other 23%

Note: Net sales by industry segment include intersegment transactions.

4

Eleven-Year SummaryYears ended March 31

1991 1992 1993

For the year:

Net sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥7,736,961 ¥7,765,545 ¥7,536,166

Japan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,881,571 5,921,552 5,736,540

Other areas . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,855,390 1,843,993 1,799,626

Cost of sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,417,159 5,488,738 5,438,158

Selling, general and administrative expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,813,383 1,924,780 1,875,847

Operating income (loss) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 506,419 352,027 222,161

Income (loss) before income taxes, minority interests

and cumulative effect of accounting change . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 562,073 374,882 234,744

Net income (loss) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 230,185 127,611 77,289

Capital investment (Property, plant and equipment) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 781,488 757,389 615,345

Depreciation (Property, plant and equipment) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 448,124 503,980 479,943

R&D expenditure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 490,708 519,525 501,191

Per share data:

Net income (loss) Basic . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥ 70.81 ¥ 38.96 ¥ 23.59

Diluted . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 65.96 36.91 22.68

Cash dividends declared . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11.00 11.00 11.00

Stockholders’ equity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 858.71 890.64 897.42


5

Millions of yen1994 1995 1996 1997 1998 1999 2000 2001

¥7,400,205 ¥7,592,266 ¥8,123,810 ¥8,523,100 ¥8,416,834 ¥7,977,374 ¥8,001,203 ¥8,416,982

5,699,533 5,768,963 6,020,922 6,070,552 5,805,111 5,533,554 5,657,571 5,791,300

1,700,672 1,823,303 2,102,888 2,452,548 2,611,723 2,443,820 2,343,632 2,625,682

5,311,992 5,393,757 5,828,887 6,250,895 6,230,044 6,052,345 5,898,756 6,155,023

1,874,824 1,893,919 1,962,341 1,975,039 1,977,783 1,959,103 1,928,083 1,919,647

213,389 304,590 332,582 297,166 209,007 (34,074) 174,364 342,312

228,363 283,643 349,992 264,795 173,458 (221,174) 79,235 323,655

65,279 113,912 143,135 89,802 12,163 (327,611) 16,922 104,380

662,248 655,410 723,477 740,135 712,672 585,718 574,642 971,095

496,132 521,435 556,671 543,560 550,393 547,022 541,253 505,507

484,237 491,481 493,788 503,508 510,878 496,728 432,342 435,579

Yen

¥ 19.92 ¥ 34.66 ¥ 43.00 ¥ 26.95 ¥ 3.64 ¥ (98.15) ¥ 5.07 ¥ 31.27

19.27 33.02 40.48 25.97 3.58 (98.15) 4.99 30.32

11.00 11.00 11.00 11.00 11.00 5.50 6.00 11.00

901.71 922.73 1,068.00 1,054.26 1,012.77 900.57 895.08 857.27

6

Consolidated Balance SheetsYears ended March 31

1991 1992 1993

Assets:

Current assets:

Cash and cash equivalents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥1,648,460 ¥1,495,794 ¥1,368,270

Short-term investments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 384,909 487,303 639,108

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,033,369 1,983,097 2,007,378

Trade receivables:

Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 481,258 493,303 418,489

Accounts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,352,641 1,327,165 1,347,967

Investment in leases . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . –– –– ––

Inventories . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,597,129 1,750,263 1,605,178

Prepaid expenses and other current assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 286,559 295,727 295,658

Total current assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,750,956 5,849,555 5,674,670

Noncurrent receivables and restricted funds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 155,680 172,427 185,130

Investments and advances, including affiliated companies . . . . . . . . . . . . . . . . . . . . . . . . . . 420,178 436,498 436,614

Property, plant and equipment:

Land . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 251,755 280,241 297,504

Buildings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,017,059 1,149,894 1,237,429

Machinery and equipment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,356,157 3,650,784 3,844,842

Construction in progress . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 89,474 106,136 78,733

4,714,445 5,187,055 5,458,508

Less accumulated depreciation 2,728,719 3,017,948 3,254,674

Net property, plant and equipment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,985,726 2,169,107 2,203,834

Other assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 213,581 230,323 247,523

¥8,526,121 ¥8,857,910 ¥8,747,771


7

Millions of yen1994 1995 1996 1997 1998 1999 2000 2001

¥1,331,605 ¥1,620,936 ¥ 1,627,716 ¥ 1,309,949 ¥ 1,199,540 ¥1,237,527 ¥1,357,432 ¥ 1,381,603

806,699 582,785 711,857 847,854 771,147 605,679 632,434 433,650

2,138,304 2,203,721 2,339,573 2,157,803 1,970,687 1,843,206 1,989,866 1,815,253

403,311 402,024 462,685 411,459 369,838 307,354 295,526 307,635

1,396,149 1,440,006 1,662,631 1,876,678 1,897,410 1,878,272 1,908,692 2,191,698

–– –– –– –– –– –– –– 623,789

1,523,593 1,572,259 1,707,159 1,576,751 1,626,684 1,470,847 1,416,878 1,514,163

335,093 357,922 377,839 396,931 418,742 408,577 354,581 391,963

5,796,450 5,975,932 6,549,887 6,419,622 6,283,361 5,908,256 5,965,543 6,844,501

169,170 180,464 161,795 188,473 195,546 176,403 160,583 163,003

438,488 436,603 1,146,508 932,015 861,126 823,136 817,436 885,669

297,889 317,604 334,488 345,322 363,771 369,701 380,076 386,785

1,392,564 1,434,417 1,514,113 1,635,937 1,703,708 1,730,333 1,731,561 1,801,731

4,064,912 4,246,645 4,538,128 4,817,314 5,074,698 5,116,062 4,887,088 5,622,410

42,575 51,599 90,481 117,290 99,755 54,453 71,184 95,663

5,797,940 6,050,265 6,477,210 6,915,863 7,241,932 7,270,549 7,069,909 7,906,589

3,505,071 3,739,284 4,055,425 4,356,366 4,595,800 4,662,942 4,515,160 5,231,632

2,292,869 2,310,981 2,421,785 2,559,497 2,646,132 2,607,607 2,554,749 2,674,957

234,114 237,638 190,815 241,615 305,727 332,340 485,050 678,478

¥8,931,091 ¥9,141,618 ¥10,470,790 ¥10,341,222 ¥10,291,892 ¥9,847,742 ¥9,983,361 ¥11,246,608

8

1991 1992 1993

Liabilities and Stockholders’ Equity:

Current liabilities:

Short-term debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥ 861,859 ¥ 906,002 ¥ 825,060

Current installments of long-term debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53,056 113,990 103,103

Trade payables:

Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 335,938 318,625 273,520

Accounts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 723,182 636,634 614,237

Accrued expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 587,664 627,604 628,361

Income taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 155,717 96,214 70,567

Advances received . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 495,183 572,081 573,583

Other current liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 481,733 470,493 466,384

Total current liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,694,332 3,741,643 3,554,815

Long-term debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 891,022 975,605 990,113

Retirement and severance benefits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 520,108 564,932 601,243

Other liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . —— —— ——

Total liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,105,462 5,282,180 5,146,171

Minority interests . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 609,518 657,779 661,442

Stockholders’ equity:

Common stock of ¥50 par value . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 269,747 270,917 270,918

Capital surplus . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 410,381 436,753 436,819

Legal reserve . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 66,519 72,163 78,161

Retained earnings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,093,902 2,173,995 2,209,261

Accumulated other comprehensive income (loss) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (29,408) (35,877) (55,001)

Total stockholders’ equity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,811,141 2,917,951 2,940,158

¥8,526,121 ¥8,857,910 ¥8,747,771


9

Millions of yen1994 1995 1996 1997 1998 1999 2000 2001

¥ 794,250 ¥ 823,402 ¥ 882,605 ¥ 994,469 ¥ 1,103,217 ¥1,045,543 ¥1,046,571 ¥ 1,199,209

107,316 83,848 150,746 187,022 214,064 114,268 259,099 412,646

245,175 212,007 212,789 140,067 132,159 97,863 98,058 138,161

640,963 710,397 823,280 945,450 944,112 907,641 974,721 1,160,789

664,065 674,653 734,036 732,070 728,741 694,399 706,647 786,813

84,671 106,793 130,974 118,685 89,715 63,241 76,969 106,727

544,449 578,137 500,889 411,752 395,674 418,360 382,085 385,741

494,925 500,637 581,829 439,489 452,007 436,653 395,686 432,571

3,575,814 3,689,874 4,017,148 3,969,004 4,059,689 3,777,968 3,939,836 4,622,657

1,025,305 1,011,996 1,203,353 1,244,612 1,287,532 1,478,168 1,482,810 1,881,270

629,242 648,493 659,510 671,794 682,871 723,028 699,385 982,332

81,625 82,651 301,581 168,071 93,050 86,101 81,718 73,689

5,311,986 5,433,014 6,181,592 6,053,481 6,123,142 6,065,265 6,203,749 7,559,948

659,940 675,227 733,663 768,836 788,239 776,462 791,925 825,158

273,266 276,041 278,178 281,684 281,735 281,735 281,738 281,754

440,517 445,260 480,718 486,695 492,272 494,782 499,081 501,243

84,147 89,955 95,377 101,146 104,370 105,905 106,885 109,815

2,231,914 2,303,612 2,439,015 2,483,489 2,451,037 2,100,392 2,082,541 2,157,136

(70,679) (81,491) 262,247 165,891 51,097 23,201 17,442 (188,446)

2,959,165 3,033,377 3,555,535 3,518,905 3,380,511 3,006,015 2,987,687 2,861,502

¥8,931,091 ¥9,141,618 ¥10,470,790 ¥10,341,222 ¥10,291,892 ¥9,847,742 ¥9,983,361 ¥11,246,608

10

Consolidated Statements of IncomeYears ended March 31

1991 1992 1993

Net sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥7,736,961 ¥7,765,545 ¥7,536,166

Cost of sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,417,159 5,488,738 5,438,158

Gross Profit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,319,802 2,276,807 2,098,008

Selling, general and administrative expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,813,383 1,924,780 1,875,847

Operating income (loss) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 506,419 352,027 222,161

Other income:

Interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 173,692 168,991 126,176

Dividends . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9,072 8,351 9,167

Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22,153 10,456 3,563

204,917 187,798 138,906

Other deductions:

Interest charges. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 129,886 140,282 113,839

Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19,377 24,661 12,484

149,263 164,943 126,323

Income (Loss) before income taxes, minority interests


Income taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 290,450 219,336 138,916

Income (Loss) before minority interests


Minority interests . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41,438 27,935 18,539

Income (Loss) before cumulative effect of accounting change . . . . . . . . . . . . . . . . . . . . . 230,185 127,611 77,289

Cumulative effect of accounting change . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . —— —— ——

Net income (loss) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 230,185 127,611 77,289


11

Millions of yen1994 1995 1996 1997 1998 1999 2000 2001

¥7,400,205 ¥7,592,266 ¥8,123,810 ¥8,523,100 ¥8,416,834 ¥7,977,374 ¥8,001,203 ¥8,416,982

5,311,992 5,393,757 5,828,887 6,250,895 6,230,044 6,052,345 5,898,756 6,155,023

2,088,213 2,198,509 2,294,923 2,272,205 2,186,790 1,925,029 2,102,447 2,261,959

1,874,824 1,893,919 1,962,341 1,975,039 1,977,783 1,959,103 1,928,083 1,919,647

213,389 304,590 332,582 297,166 209,007 (34,074) 174,364 342,312

94,434 74,550 51,126 37,632 41,084 40,178 35,380 32,428

6,863 8,003 7,482 8,113 8,881 7,060 6,662 9,641

3,675 13,319 53,720 43,557 112,255 1,144 30,059 27,544

104,972 95,872 112,328 89,302 162,220 48,382 72,101 69,613

78,113 74,998 63,375 60,669 59,635 59,028 52,015 58,759

11,885 41,821 31,543 61,004 138,134 176,454 115,215 29,511

89,998 116,819 94,918 121,673 197,769 235,482 167,230 88,270

228,363 283,643 349,992 264,795 173,458 (221,174) 79,235 323,655

146,953 153,443 165,764 138,495 134,409 97,660 47,502 164,861

81,410 130,200 184,228 126,300 39,049 (318,834) 31,733 158,794

13,161 16,288 41,093 36,498 26,886 8,777 14,811 54,414

68,249 113,912 143,135 89,802 12,163 (327,611) 16,922 104,380

2,970 —— —— —— —— —— —— ––

65,279 113,912 143,135 89,802 12,163 (327,611) 16,922 104,380

12

Consolidated Statements of Cash FlowsYears ended March 31

1991 1992 1993

Cash flows from operating activities:

Net income (loss) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥ 230,185 ¥ 127,611 ¥ 77,289

Adjustments to reconcile net income (loss) to net cash provided by operating activities:Depreciation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 448,124 503,980 479,943

Impairment loss for long-lived assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . —— —— ——

Comulative effect of accounting change . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . —— —— ——Deferred income taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (17,761) (7,358) (21,977)

Gain on sale of investments and subsidiaries’ common stock . . . . . . . . . . . . . . . . . . . . (21,255) (16,102) (2,007)

Loss on disposal of rental assets and other property . . . . . . . . . . . . . . . . . . . . . . . . . . . —— —— ——Income applicable to minority interests . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41,438 27,935 18,539

(Increase) decrease in receivables . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (213,413) 101,428 48,713

(Increase) decrease in inventories . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (258,290) (160,465) 120,492(Increase) decrease in prepaid expenses and other current assets . . . . . . . . . . . . . . . (7,078) (9,992) (8,370)

Increase (decrease) in payables . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 144,218 (122,775) (93,370)

Increase (decrease) in accrued expenses and retirement and severance benefits . . . 60,560 84,764 45,045Increase (decrease) in accrued income taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (1,052) (59,267) (24,921)

Increase (decrease) in other liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30,735 13,022 19,737

Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (7,193) 27,764 25,867Net cash provided by operating activities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 429,218 510,545 684,980

Cash flows from investing activities:(Increase) decrease in short-term investments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (60,125) (109,527) (137,859)

Capital expenditures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (743,399) (781,748) (639,323)

Purchase of asets to be leased (Note 1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . —— —— ——Collection of investment in leases (Note 1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . —— —— ——

Proceeds from disposition of rental assets and other property . . . . . . . . . . . . . . . . . . . . . 47,719 58,126 58,283

Proceeds from sale of investments and subsidiaries’ common stock . . . . . . . . . . . . . . . . 26,271 24,178 4,380Purchase of investments and subsidiaries’ common stock . . . . . . . . . . . . . . . . . . . . . . . . (45,745) (17,823) (9,290)

Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (27,619) (36,929) (21,077)

Net cash used in investing activities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (802,898) (863,723) (744,886)

Cash flows from financing activities:

Increase (decrease) in short-term debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 96,357 50,743 (51,609)Proceeds from long-term debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 128,017 211,066 159,692

Payments on long-term debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (44,971) (54,414) (119,468)

Proceeds from sale of common stock by subsidiaries . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46,459 42,821 270Dividends paid to stockholders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (37,783) (35,925) (35,906)

Dividends paid to minority stockholders of subsidiaries . . . . . . . . . . . . . . . . . . . . . . . . . . . (9,428) (9,756) (9,482)

Purchase and retirement of common shares by subsidiaries . . . . . . . . . . . . . . . . . . . . . . . —— —— ——Net cash provided by (used in) financing activities . . . . . . . . . . . . . . . . . . . . . . . . . . . 178,651 204,535 (56,503)

Effect of exchange rate changes on cash and cash equivalents . . . . . . . . . . . . . . . . . . . . . . (10,245) (4,023) (11,115)Net increase (decrease) in cash and cash equivalents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (205,274) (152,666) (127,524)

Cash and cash equivalents at beginning of year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,853,734 1,648,460 1,495,794

Cash and cash equivalents at end of year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥1,648,460 ¥1,495,794 ¥1,368,270

Notes: 1. According to the importance of lease assets, the Company divided the amount of “Capital expenditures” into two categories; “Capital expenditures” and “Purchase of assetsto be leased.” Figures for 1999 and 2000 have also been restated using the same method.

2. See notes on inside cover.

13

Millions of yen1994 1995 1996 1997 1998 1999 2000 2001

¥ 65,279 ¥ 113,912 ¥ 143,135 ¥ 89,802 ¥ 12,163 ¥ (327,611) ¥ 16,922 ¥ 104,380

496,132 521,435 556,671 543,560 550,393 547,022 541,253 505,507

—— —— —— 44,289 35,504 2,740 9,310 ——

2,970 —— —— —— —— —— —— ——

(8,721) (16,488) (30,154) (61,099) (14,667) (22,976) (67,179) 12,505

(3,229) (5,879) (40,746) (24,262) (117,998) (3,938) (36,215) (17,437)

—— —— —— 24,200 12,078 69,996 19,921 19,165

13,161 16,288 41,093 36,498 26,886 8,777 14,811 54,414

(77,936) (50,604) (295,990) (197,337) 13,175 (2,549) (107,685) (72,035)

57,969 (67,092) (102,694) 162,473 (53,703) 127,802 (26,273) (128,477)

(947) (12,029) (15,145) 4,335 (12,847) (1,133) (9,931) (38,234)

7,589 41,581 104,944 994 (7,254) (45,274) 78,728 95,855

71,704 37,272 57,730 (3,428) 5,132 19,400 3,846 8,171

14,913 23,307 21,141 (14,461) (28,880) (25,135) 15,884 26,337

18,290 (1,618) 25,620 (98,271) 6,892 25,338 (41,385) (62,858)

31,056 20,668 7,828 (20,569) (6,133) 16,420 39,443 28,140

688,230 620,753 473,433 486,724 420,741 388,879 451,450 535,433

(163,313) 225,843 (8,216) (169,644) 49,462 153,382 (15,155) 198,610

(593,462) (651,577) (717,085) (750,066) (690,419) (406,685) (365,744) (463,585)

—— —— —— —— —— (212,657) (211,185) (532,142)

—— —— —— —— —— —— —— 421,527

32,100 93,230 61,925 49,075 32,334 26,427 133,806 70,442

7,673 12,801 33,665 34,760 144,127 16,542 67,971 50,473

(18,894) (15,518) (38,914) (43,751) (165,898) (13,837) (40,463) (125,473)

3,322 (502) (4,201) 9,123 (7,932) (13,721) (4,821) 9,431

(732,574) (335,723) (672,826) (870,503) (638,326) (450,549) (435,591) (370,717)

(8,800) 52,132 17,964 60,490 97,057 (1,845) 43,155 (5,153)

149,188 130,490 332,559 201,985 279,866 375,344 315,408 518,872

(76,951) (126,321) (118,716) (168,597) (223,517) (230,273) (194,038) (642,594)

357 1,138 3,460 5,305 7,423 701 9,046 13,342

(35,937) (36,005) (36,337) (36,520) (36,600) (18,412) (27,762) (28,235)

(9,603) (9,746) (9,805) (10,599) (11,838) (11,722) (12,033) (15,739)

—— —— —— —— —— —— (7,946) ——

18,254 11,688 189,125 52,064 112,391 113,793 125,830 (159,507)

(10,575) (7,387) 17,048 13,948 (5,215) (14,136) (21,784) 18,962

(36,665) 289,331 6,780 (317,767) (110,409) 37,987 119,905 24,171

1,368,270 1,331,605 1,620,936 1,627,716 1,309,949 1,199,540 1,237,527 1,357,432

¥1,331,605 ¥1,620,936 ¥1,627,716 ¥1,309,949 ¥1,199,540 ¥1,237,527 ¥1,357,432 ¥1,381,603

14

Segment InformationYears ended March 31, 1999, 2000 and 2001

Millions of yen1999 2000 2001

Sales Information Systems & Electronics . . . . . . . . . . . . . . . . . . . . ¥3,106,377 ¥3,148,888 ¥ 3,455,578

Power & Industrial Systems. . . . . . . . . . . . . . . . . . . . . . . . . . 2,406,966 2,372,610 2,530,772

Consumer Products . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 897,241 904,992 923,458

Materials . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,338,819 1,346,292 1,460,638

Services & Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,123,300 2,146,177 2,458,270

Subtotal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9,872,703 9,918,959 10,828,716

Eliminations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (1,895,329) (1,917,756) (2,411,734)

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7,977,374 8,001,203 8,416,982

Operating income Information Systems & Electronics . . . . . . . . . . . . . . . . . . . . (90,362) 52,325 142,111

(loss) Power & Industrial Systems. . . . . . . . . . . . . . . . . . . . . . . . . . 30,313 41,790 85,216

Consumer Products . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (6,375) 19,949 2,478

Materials . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27,886 49,887 82,148

Services & Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51,474 53,781 66,428

Subtotal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12,936 217,732 378,381

Eliminations & Corporate items . . . . . . . . . . . . . . . . . . . . . . . (47,010) (43,368) (36,069)

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (34,074) 174,364 342,312

Notes: 1. Net sales by industry segment include intersegment transactions.2. This information is disclosed in accordance with a ministerial ordinance under the Securities and Exchange Law of Japan.

Industry Segments

15


Japan Sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥5,533,554 ¥5,657,571 ¥5,791,300

Percentage of net sales (%) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 69 71 69

Outside Japan Asia . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 895,457 897,664 966,870


North America . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 838,848 767,241 903,800


Europe . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 539,741 484,744 550,968


Other Areas . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 169,774 193,983 204,044


Subtotal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,443,820 2,343,632 2,625,682


Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7,977,374 8,001,203 8,416,982


Sales

Japan Outside customer sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥6,325,140 ¥6,410,934 ¥6,557,736

Intersegment transactions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 914,527 951,918 1,148,587

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7,239,667 7,362,852 7,706,323

Asia Outside customer sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 471,049 462,652 550,303Intersegment transactions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 260,979 303,156 415,946

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 732,028 765,808 966,249North America Outside customer sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 732,695 723,086 863,349

Intersegment transactions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46,116 31,512 48,141Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 778,811 754,598 911,490

Europe Outside customer sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 410,770 364,618 395,809Intersegment transactions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21,169 44,737 27,513

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 431,939 409,355 423,322Other Areas Outside customer sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37,720 39,913 49,785

Intersegment transactions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,697 10,016 4,254Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42,417 49,929 54,039

Subtotal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9,224,862 9,342,542 10,061,423Eliminations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (1,247,488) (1,341,339) (1,644,441)

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7,977,374 8,001,203 8,416,982Operating Income (Loss)Japan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,116 183,954 303,359Asia . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9,118 21,302 45,032North America . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (3,769) 15,513 7,037Europe . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,926 3,871 13,109Other Areas . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (498) (1,407) 1,246

Subtotal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9,893 223,233 369,783Eliminations & Corporate items . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (43,967) (48,869) (27,471)

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (34,074) 174,364 342,312

Geographic Segments

Sales by Market

16

1991 1992 1993

Net sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥7,737 ¥7,766 ¥7,536Operating income (loss) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 506 352 222Net income (loss) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 230 128 77Cost of sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,417 5,489 5,438

Ratio to net sales (%) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 70.0% 70.7% 72.2%Selling, general and administrative expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,813 1,925 1,876

Ratio to net sales (%) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23.4% 24.8% 24.9%Operating income (loss) to net sales (%). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.5% 4.5% 2.9%Return on sales (%) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.0% 1.6% 1.0%Return on equity (%) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8.6% 4.5% 2.6%Return on assets (%) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.7% 1.4% 0.9%Capital investment (Property, plant and equipment) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 781 757 615Depreciation (Property, plant and equipment) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 448 504 480Free cash flows . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (374) (353) (60)R&D expenditure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 491 520 501

Ratio to net sales (%) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.3% 6.7% 6.7%

Notes: 1. Figures may not agree due to rounding.2. Rerutn on sales = Net income (loss) / Net sales.3. Rerutn on equity = Net income (loss) / Average shareholder’s equity.4. Rerutn on assets = Net income (loss) / Total assets as of March 31.5. Free cash flows = Cash flows from operating activities + Cash flows from investing activities.6. See notes on inside cover.

Cost of sales and SG&A expenses

■ Cost of sales■ SG&A expenses

Return on assets and Return on equity

Return on assets Return on equity

Capital investment (Property, plant and equipment)

■ Net sales (left scale)■ Net income (loss) (right scale)

Net sales and Net income (loss)

Analysis of Operating ResultsYears ended March 31

-4,000

-2,000

0

2,000

4,000

6,000

8,000

10,000

-400

-300

0

100

200

300

400

500

01009998979695949392910

2,000

4,000

6,000

8,000

0100999897969594939291

-15

-10

-5

0

5

10

01009998979695949392910

200

400

600

800

1,000

0100999897969594939291

(Billions of yen) (Billions of yen)

(%)

(Billions of yen)

(Billions of yen)

17

Billions of yen1994 1995 1996 1997 1998 1999 2000 2001

¥7,400 ¥7,592 ¥8,124 ¥8,523 ¥8,417 ¥7,977 ¥8,001 ¥8,417213 305 333 297 209 (34) 174 342

65 114 143 90 12 (328) 17 1045,312 5,394 5,829 6,251 6,230 6,052 5,899 6,155

71.8% 71.0% 71.8% 73.3% 74.0% 75.9% 73.7% 73.1%1,875 1,894 1,962 1,975 1,978 1,959 1,928 1,920

25.3% 25.0% 24.2% 23.2% 23.5% 24.6% 24.1% 22.8%2.9% 4.0% 4.1% 3.5% 2.5% (0.4)% 2.2% 4.1%0.9% 1.5% 1.8% 1.0% 0.0% (4.1)% 0.2% 1.2%2.2% 3.8% 4.3% 2.5% 0.4% (10.3)% 0.6% 3.6%0.7% 1.2% 1.4% 0.9% 0.1% (3.3)% 0.2% 0.9%

662 655 723 740 713 586 575 971496 521 557 544 550 547 541 506(44) 285 (199) (384) (218) (62) 16 165484 491 494 504 511 497 432 4366.5% 6.5% 6.1% 5.9% 6.1% 6.2% 5.4% 5.2%

Free cash flows andDepreciation (Property, plant and equipment)

■ Free cash flows■ Depreciation

Operating income (loss) to net sales Return on sales

R&D expenditure and R&D expenditure to net sales

■ R&D expenditure (left scale)R&D expenditure to net sales (right scale)

-2

0

2

4

6

8

0100999897969594939291-5

-4

0

1

2

3

4

0100999897969594939291

-400

-200

0

200

400

600

01009998979695949392910

100

200

300

400

500

600

0100999897969594939291

2

4

6

8

10

12

(%)

(Billions of yen)

(%)

(Billions of yen) (%)

18

1991 1992 1993

Interest expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥ 130 ¥ 140 ¥ 114Interest coverage (Times) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.33 3.67 3.06Current assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,751 5,850 5,675Current liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,694 3,742 3,555Current ratio (%) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 155.67% 156.34% 159.63%Short-term debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 915 1,020 928Long-term debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 891 976 990Total debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,806 1,996 1,918Stockholders’ equity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,811 2,918 2,940Total assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8,526 8,858 8,748Debt / equity ratio (Times) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.64 0.68 0.65Stockholders’ equity ratio (%) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32.97% 32.94% 33.61%Asset turnover (Times) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.91 0.88 0.86Fixed assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,986 2,169 2,204Fixed assets turnover (Times) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.90 3.58 3.42

Notes: 1. Interest coverage =

2. “Fixed assets” represents the net carrying amounts of property, plant and equipment.3. Current ratio = Current assets / Current liabilities as of March 31.4. Stockholders’ equity ratio = Stockholders’ equity / Total assets as of March 31.5. Asset turnover = Net sales / Total assets as of March 31.6. Fixed assets turnover = Net sales / Fixed assets as of March 31.7. See notes on inside cover.

Asset turnover Fixed assets turnover

Current ratio

■ Interest expense (left scale)Interest coverage (right scale)

Interest expense and Interest coverage

Income (loss) before income taxes and minority interests + Interest expenseInterest expense

-100

-50

0

50

100

150

200

0100999897969594939291-4

-2

0

2

4

6

8

0

150

160

170

0100999897969594939291

0

0.8

0.9

1.0

01009998979695949392910

3

4

5

0100999897969594939291

(Billions of yen) (Times)

(Times)

(%)

(Times)

19

Billions of yen1994 1995 1996 1997 1998 1999 2000 2001

¥ 78 ¥ 75 ¥ 63 ¥ 61 ¥ 60 ¥ 59 ¥ 52 ¥ 593.92 4.78 6.52 5.36 3.91 (2.75) 2.52 6.51

5,796 5,976 6,550 6,420 6,283 5,908 5,966 6,8453,576 3,690 4,017 3,969 4,060 3,778 3,940 4,623

162.10% 161.95% 163.05% 161.74% 154.77% 156.39% 151.42% 148.06%902 907 1,033 1,181 1,317 1,160 1,306 1,612

1,025 1,012 1,203 1,245 1,288 1,478 1,483 1,8811,927 1,919 2,237 2,426 2,605 2,638 2,788 3,4932,959 3,033 3,556 3,519 3,381 3,006 2,988 2,8628,931 9,142 10,471 10,341 10,292 9,848 9,983 11,247

0.65 0.63 0.63 0.69 0.77 0.88 0.93 1.2233.13% 33.18% 33.96% 34.03% 32.85% 30.52% 29.93% 25.44%

0.83 0.83 0.78 0.82 0.82 0.81 0.80 0.752,293 2,311 2,422 2,559 2,646 2,608 2,555 2,675

3.23 3.29 3.35 3.33 3.18 3.06 3.13 3.15

Debt / equity ratio Stockholders’ equity ratio

0

0.6

0.8

1.0

1.2

1.4

0100999897969594939291

(Times) (%)

0

25

30

35

0100999897969594939291

20

Stock Information

Common Stock Price Movement (Tokyo Stock Exchange)

Price Range of Hitachi Common Stock1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001

Price range High . . . . . . ¥ 1,720 ¥ 1,270 ¥ 873 ¥ 979 ¥ 1,120 ¥ 1,140 ¥ 1,180 ¥ 1,390 ¥ 1,015 ¥ 1,709 ¥ 1,549

Low . . . . . . . 1,020 750 670 729 799 781 961 877 532 814 899

Price at the end of March . 1,230 785 848 930 900 1,040 1,100 970 877 1,219 1,073

Nikkei Stock Average (225) . . 26,292 19,345 18,591 19,111 16,139 21,406 18,003 16,527 15,836 20,337 12,999

Note: Common stock prices are those of Hitachi, Ltd.

Price/Earnings Ratio, Price/Cash Flow Ratio and Price/Book Value RatioYears ended March 31

1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001

Net income (loss) per share

(Diluted) (¥) . . . . . . . . . . . . . . . . . 65.96 36.91 22.68 19.27 33.02 40.48 25.97 3.58 (98.15) 4.99 30.32

Price/earnings ratio (Times) . . . . . 18.6 21.3 37.4 48.3 27.3 25.7 42.4 270.9 —— 244.3 35.4

Free cash flows per share (¥) . . . (105.72) (99.92) (16.95) (12.55) 80.65 (55.88) (108.18) (61.36) (17.40) 4.47 46.47

Price/free cash flow ratio (Times) . . —— —— —— —— 11.16 —— —— —— —— 272.71 23.09

Stockholders’ equity per share (¥) . 858.71 890.64 897.42 901.71 922.73 1,068.00 1,054.26 1,012.77 900.57 895.08 857.27

Price/book value ratio (Times) . . . 1.43 0.88 0.94 1.03 0.98 0.97 1.04 0.96 0.97 1.36 1.25

Cash dividends declared

per share (¥) . . . . . . . . . . . . . . . . 11.00 11.00 11.00 11.00 11.00 11.00 11.00 11.00 5.50 6.00 11.00

Notes: 1. Net income (loss) per share is based on common stock and common stock equivalents of Hitachi, Ltd.2. Stockholders’ equity per share is based on common stock of Hitachi, Ltd.3. Free cash flows per share is based on common stock and common stock equivalents of Hitachi, Ltd.4. See notes on inside cover.

Issue date Type Amount Coupon (%) Conversion Price Redemption Date

1/27/1987 CB #5 ¥120,000 million 1.7 ¥1,012.40 3/29/2002

8/ 2 /1988 CB #6 ¥120,000 million 1.3 ¥1,875.20 9/30/2003

5/16/1989 CB #7 ¥250,000 million 1.4 ¥1,694.30 9/30/2004

Equity-Linked Financings

0

500

1,000

1,500

2,000

2,500

3,000

01009998979695949392910

5,000

10,000

15,000

20,000

25,000

30,000

Hitachi’s Common Stock Price at the end of March(left scale)Nikkei Stock Average (225) (right scale)

■ Price range

(Yen) (Yen)

21

Depositary forAmerican DepositaryReceipts:

Transfer Agent forthe Shares:

Composition ofShareholdersAs of March 31, 2001

Major StockholdersAs of March 31, 2001

Numbers of Shares held Percentage of Shares Held

Japan Trustee Services Bank, Ltd. 184,058,000 5.51%

Nippon Life Insurance Company 132,416,472 3.97%

The Chase Manhattan Bank, N.A. London 124,802,267 3.74%

State Street Bank and Trust Company 107,778,562 3.23%

NATS CUMCO 103,134,580 3.09%

The Chuo Mitsui Trust and Banking Company, Limited 99,066,500 2.97%

The Dai–Ichi Mutual Life Insurance Company 93,284,178 2.79%

Hitachi Employees’ Shareholding Association 85,040,952 2.55%

The Mitsubishi Trust and Banking Corporation 83,842,222 2.51%

The Toyo Trust and Banking Company, Limited 76,123,565 2.28%

Note: NATS CUMCO is the nominee name for the aggregate of the Company’s American Depositary Reciepts (ADRs) holders.

Financial Institutions and Securities Firms 39.97%

Foreign Investors 29.41%

Individuals 27.06%

Others 3.56%

Governments 0.00%

TOKYO SECURITIES TRANSFER AGENT CO., LTD.5-1, Marunouchi, 1-chome, Chiyoda-ku, Tokyo, 100-0005, JapanTel. +81-3-3212-4601

Citibank, N.A.111 Wall StreetNew York, NY10005, U.S.A.Tel. +1-877-248-4237

Overseas StockExchange Listings

Luxembourg, Frankfurt, Amsterdam, Paris and New York stock exchanges

Japanese StockExchange Listings

Tokyo, Osaka, Nagoya, Fukuoka, and Sapporo stock exchanges

22

Issued Capital PercentageName of Subsidiary (Millions of yen) of Ownership Industry Segments

Babcock-Hitachi Kabushiki Kaisha 5,000 100.0 Power & Industrial Systems

Hitachi Air Conditioning Systems Co., Ltd. 10,000 100.0 Power & Industrial Systems

Hitachi Cable, Ltd. 25,948 52.5 Materials

Hitachi Chemical Co., Ltd. 15,028 53.9 Materials

Hitachi Construction Machinery Co., Ltd. 22,199 54.8 Power & Industrial Systems

Hitachi Electronics Engineering Co., Ltd. 2,275 61.0 Information Systems & Electronics

Hitachi Hokkai Semiconductor, Ltd. 2,400 100.0 Information Systems & Electronics

Hitachi Hometec, Ltd. 800 100.0 Consumer Products

Hitachi Kiden Kogyo, Ltd. 2,613 58.6 Power & Industrial Systems

Hitachi Maxell, Ltd. 12,202 52.4 Consumer Products

Hitachi Media Electronics Co., Ltd. 500 100.0 Consumer Products

Hitachi Medical Corporation 13,884 65.5 Information Systems & Electronics

Hitachi Metals, Ltd. 26,283 55.0 Materials

Hitachi Telecom Technologies, Ltd. 900 100.0 Information Systems & Electronics

Hitachi Tohbu Semiconductor, Ltd. 1,280 100.0 Information Systems & Electronics

Hitachi Tokyo Electronics Co., Ltd. 600 100.0 Information Systems & Electronics

Hitachi Via Mechanics, Ltd. 1,650 100.0 Power & Industrial Systems

Japan Servo Co., Ltd. 2,547 53.1 Power & Industrial Systems

Trecenti Technologies, Inc. 30,000 60.0 Information Systems & Electronics

Major Consolidated SubsidiariesAs of March 31, 2001

Japan/Manufacturing

23

Issued Capital PercentageName of Subsidiary (Millions of yen) of Ownership Industry Segments

Chuo Shoji, Ltd. 2,000 100.0 Services & Other

Hitachi Building Systems Co., Ltd. 5,105 100.0 Power & Industrial Systems

Hitachi Capital Corporation 9,459 53.0 Services & Other

Hitachi Electronics Services Co., Ltd. 5,000 100.0 Information Systems & Electronics

Hitachi Engineering & Services Co., Ltd. 1,950 100.0 Power & Industrial Systems

Hitachi Engineering Co., Ltd. 1,650 100.0 Power & Industrial Systems

Hitachi Information Systems, Ltd. 13,062 50.5 Information Systems & Electronics

Hitachi Life Corporation 1,000 100.0 Services & Other

Hitachi Mobile Co., Ltd. 1,000 100.0 Power & Industrial Systems

Hitachi Plant Engineering & Construction Co., Ltd. 7,319 56.3 Power & Industrial Systems

Hitachi Semiconductor and Devices Sales Co., Ltd. 2,000 100.0 Information Systems & Electronics

Hitachi Service & Engineering (East), Ltd. 600 100.0 Power & Industrial Systems

Hitachi Service & Engineering (West), Ltd. 600 100.0 Power & Industrial Systems

Hitachi Software Engineering Co., Ltd. 32,776 52.6 Information Systems & Electronics

Hitachi Systems & Services, Ltd. 1,000 100.0 Information Systems & Electronics

Hitachi Techno Engineering Co., Ltd. 1,000 100.0 Power & Industrial Systems

Hitachi Transport System, Ltd. 16,802 59.9 Services & Other

Nikkyo Create, Ltd. 1,000 100.0 Services & Other

Nissei Sangyo Co., Ltd. 5,438 58.0 Services & Other

Notes: 1. Hitachi Credit Corporation and Hitachi Leasing, Ltd. were merged to create Hitachi Capital Corporation on October 1, 2000.2. Nikkyo Create, Ltd. changed its name from Hitachi Keisho, Ltd. on October 1, 2000.

Japan/Engineering, Sales and Service

24

PercentageName of Subsidiary Issued Capital of Ownership Industry Segments

Hitachi Automotive Products (USA), Inc. US$32.8 million 100.0 Power & Industrial Systems

Hitachi Computer Products (America), Inc. US$14.0 million 100.0 Information Systems & Electronics

Hitachi Computer Products (Asia) Corp. P.P2,005.3 million 100.0 Information Systems & Electronics

Hitachi Computer Products (Europe) S.A. FFr100.0 million 100.0 Information Systems & Electronics

Hitachi Consumer Products (S) Pte. Ltd. S$18.7 million 100.0 Consumer Products

Hitachi Electronic Devices (Singapore) Pte. Ltd. S$70.0 million 85.0 Information Systems & Electronics

Hitachi Electronic Devices (USA), Inc. US$140.9 million 100.0 Information Systems & Electronics

Hitachi Home Electronics (America), Inc. US$40.0 million 100.0 Consumer Products

Hitachi Home Electronics (Europe) Ltd. £13.0 million 100.0 Consumer Products

Hitachi Nippon Steel Semiconductor Singapore Pte. Ltd. S$440 million 53.8 Information Systems & Electronics

Hitachi Semiconductor (Europe) GmbH DM500.0 million 100.0 Information Systems & Electronics

Hitachi Semiconductor (Malaysia) Sdn. Bhd. M$84.0 million 90.0 Information Systems & Electronics

Shanghai Hitachi Household Appliances Co., Ltd. RMB262.7 million 60.0 Consumer Products

Taiwan Hitachi Co., Ltd. NT$2,334.5 million 61.5 Power & Industrial Systems

Abroad/Manufacturing

PercentageName of Subsidiary Issued Capital of Ownership Industry Segments

Hitachi America, Ltd. US$245.8 million 100.0 Services & Other

Hitachi Asia Ltd. S$24.0 million 100.0 Services & Other

Hitachi (China), Ltd. US$62.2 million 100.0 Services & Other

Hitachi Data Systems Holding Corp. US$381.8 million 100.0 Information Systems & Electronics

Hitachi Europe Ltd. £12.3 million 100.0 Services & Other

Hitachi Semiconductor (America) Inc. US$57.0 million 100.0 Information Systems & Electronics

Abroad/Engineering, Sales and Service

For further information, please contact:Investor Relations

Phone +81-3-3258-2055

Facsimile +81-3-3258-5480

Printed in JapanThis Financial Highlights was printed on 100% recycled paper.

financial highlights 2001 - hitachi.com filecontents notes 1. hitachi’s fiscal year ends march 31....

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