ロボット ロボマシン

ANNUAL REPORT 2017
Year ended March 31, 2017

FANUC’s Symbol “Keyaki” – Zelkova tree

CONTENTS
Financial Highlights (Consolidated)･････････････2
A Message To Our Shareholders･･･････････････3
Summary of FANUC Business･･････････････････4
Business Report･･･････････････････････････････5
Management Policy･･･････････････････････････8
History of FANUC･････････････････････････････9
Corporate Governance･･････････････････････ 10
Financial Section････････････････････････････ 13
Global Service Network･････････････････････ 36

Forward-looking statements
Statements contained in this report that relate to the future operating activities, business performance, events or conditions of
FANUC are forward-looking statements. Forward-looking statements are based on judgments made by FANUC’s management
based on information available at the time of publishing this report and are subject to significant assumptions. As such, theseforward-looking statements are subject to various risks and uncertainties and actual business results may vary substantially fromthe forecasts expressed or implied in forward-looking statements. Accordingly, you are cautioned not to place undue relianceon forward-looking statements. FANUC disclaims any obligation to revise forward-looking statements in light of new information,
future events or other findings.

1

Financial Highlights (Consolidated)Thousands of
U.S. dollars

Millions of yen

Years ended March 31

2015

2016

2017

2017

¥ 729,760¥ 623,418¥ 536,942$ 4,794,125

207,599

159,700

127,697

1,140,152

Total assets¥1,611,626¥1,512,895¥1,564,769$13,971,152

Net assets

1,386,695

1,334,910

1,369,457

12,227,295

For the year:
Net sales
Net income attributable to owners of parent
At the year end:

Yen

U.S. dollars

Per share data:¥ 1,061.02

Net income
Cash dividends¥

636.62816.78490.07¥

658.63$

5.88

395.18

3.53

Note :	The U.S. dollar amounts shown above and elsewhere in this annual report are converted from yen, for the readers’convenience at the rate of ¥112 = U.S.$1.00.

Net Sales

Net income attributable to owners of parent(Millions of yen)

Total Assets(Millions of yen)729,760(Millions of yen)

1,611,626

1,564,769

1,512,895

207,599
623,418

536,942

159,700

127,697

2015

2

2016

2017

2015

2016

2017

2015

2016

2017

FANUC CORPORATION ANNUAL REPORT 2017

A Message To Our Shareholders

During this period, the business environment surrounding the FANUC Group was marked by steady demand for capital investment in theAmericas, and unchanged levels of demand in Japan and Europe. In China and other Asian economies, signs of recovery were observed fromaround the end of the period.
Under these circumstances, the FANUC Group strived to earn customer trust in our products and services to an even greater extent, by becoming united as one group under the slogans “one FANUC,” “Reliable / Predictable / Easy to Repair,” and “Service First.” In addition, we
pushed ahead with initiatives to stabilize and further develop our future business, by proceeding with the adoption of AI technology to our
products along with accelerating support for IoT mainly through preparations for the startup of the FIELD system (FANUC Intelligent Edge
Link and Drive system).
During the fiscal year ended March 31, 2017, FANUC posted consolidated net sales totaling ¥536,942 million, down 13.9%, consolidated
operating income totaling ¥153,217 million, down 28.9%, and consolidated net income totaling ¥127,697 million, down 20.0%, comparedwith the previous fiscal year.
Going forward, it is anticipated that the US market will remain strong, and continued signs of recovery will be observed in China and other
Asian economies. The FANUC Group will firmly address demand, while making all-out efforts to expand sales in Europe.
Despite these trends, however, the situation is expected to remain challenging and unpredictable as a whole, due to foreign exchange movements and concerns over geopolitical risks and other factors.
Even under these circumstances, the FANUC Group, looking ahead to the future, will continue management that is based on a long-term
perspective and is not affected by short-term events.
Based on this fundamental approach and the slogan of “one FANUC,” the FANUC Group shall take maximum advantage of our uniquestrength in uniting our FA, ROBOT and ROBOMACHINE Divisions to jointly provide total solutions and take care of customers throughout theworld.
In addition, the FANUC Group will adhere to its origins as a producer of equipment to be used in manufacturing sites, and shall be thoroughin implementing our slogan of “Reliable / Predictable / Easy to Repair” in product development, in order to minimize downtime in our customers’ factories and improve their operation rates. At the same time, as a supplier of capital goods, we will fulfill our supplier responsibility tocustomers by ensuring a production system that customers can rely on.
Furthermore, we shall practice our basic policy of “Service First” in providing high-level services pursuant to FANUC’s global standard anywhere in the world, and “lifetime maintenance” for as long as our customers use our products.
FANUC believes that AI and IoT are indispensable technologies in order for FANUC to continue developing and launching highly competitive
products in the market. By proactively adopting these technologies in all areas of the FA, ROBOT and ROBOMACHINE products, we willfurther promote customers’ production efficiency.
United as one group in the promotion of these measures, we will continue to ensure the practice of “Strict Preciseness and Transparency,”
the principle of FANUC since its foundation, and make efforts to gain more customer confidence and trust in the FANUC Group and become
a company that will last forever.
Thank you for your continued support and assistance to FANUC.

Yoshiharu Inaba
Chairman & CEO

Kenji Yamaguchi
President & COO

3

Summary of FANUC Business

FA Division
Main Products

Results for Fiscal 2016

●

CNC

●

SERVO MOTOR

Consolidated net sales was ¥175,016
million, up 2.8% compared with the pre-

●

LASER

vious fiscal year, accounting for 32.6% ofconsolidated net sales.
Refer to page 5 for details

ROBOT Division
Main Products

Results for Fiscal 2016

Collaborative Robot Consolidated net sales was ¥190,043
million, up 0.9% compared with the pre● Super Heavy●

Payload Robot●

Genkotsu-Robot

vious fiscal year, accounting for 35.4% ofconsolidated net sales.
Refer to page 6 for details

ROBOMACHINE Division
Main Products

Results for Fiscal 2016●

ROBODRILL●ROBOSHOT●ROBOCUT

Consolidated net sales was ¥93,939
million, down 48.7% compared withthe previous fiscal year, accounting for●

ROBONANO

17.5% of consolidated net sales.

Refer to page 7 for details

Service Division
Results for Fiscal 2016
Consolidated net sales was ¥77,944 million, down 4.8% compared with the previous fiscal year, accounting for 14.5% ofconsolidated net sales.

4

FANUC CORPORATION ANNUAL REPORT 2017

Business Report

FA Business Division
The machine tool industry, the primary market for
FANUC CNC systems, experienced an increase in
short-term demand in China at the beginning of theperiod and showed signs of an overall recovery trend
in China and other Asian economies from aroundthe end of the period, despite continued severe difficulties mainly in Europe. Sales in Japan remained
steady.
Due to these circumstances, net sales of CNC systems of the FANUC Group increased compared withthe previous fiscal year.
In terms of development, “Fine Surface Technology,”
a control technology capable of realizing high-quality machining at a superior level, was developed forthe nano CNCs, “FANUC 30i series” that deliver highspeed, high-quality machining, and for FANUC’s
global-standard CNCs, “FANUC 0i series.” In addition, “Smart Machine Control,” which performs motor control while monitoring machine conditions andis a group of functions differentiated from conventional motor control, was further enhanced during
this period. Furthermore, our CNCs for general industrial machines, the Power Motion series, were
given various upgrades and additional functions, including significant enhancement of basic performance and cycle time reduction.
In the servo field, the lineup of the “SYNCHRONOUS
BUILT-IN SPINDLE MOTOR BiS-B series” was expanded, and their capabilities including output were enhanced. Furthermore, spindle motors received
additional functions related to reduction of machining time and improvement of movement stability,
among other changes. In addition, a tool was developed that allows customers to select motors appropriate to their machines’ specifications.
FANUC laser sales were sluggish domestically andabroad.
In terms of development, the lineup of the fiber laser
oscillators “FANUC FIBER LASER series” was completed, now with products ranging from 500W to
6000W in output, as a result of adding the 500W
and 1000W output models. The models with an
output of 1000W or less are highly expected to be
applied to laser multi-tasking machines and to expand sales in fields such as 3D additive manufacturing (3D printing) using metal.

CNC Series

SERVO MOTOR, SERVO AMPLIFIER

LASER

5

ROBOT Business Division
Sales of robots remained steady in the Americas andEurope, despite a trough in facility investments in theautomobile industry, etc. during the first half of thisperiod. In China, the growth of demand was striking.
In Japan, sales were favorable mainly with robots forthe automobile industry.
New developments included the enhancement ofour green “Collaborative Robots,” which do not require a safety fence and enable robots and humans
to work together, with the addition of three models
of small payload types, which can be expected to
expand sales in general industries.

Collaborative Robot

In the multi-purpose intelligent “FANUC Robot R2000iC series,” which is the culmination of FANUC’s
long years of experience and technology, an upsidedown mount type 220 kg payload model and a water proof for washing, 210 kg payload model were
newly developed to expand the lineup.
Additionally, in the medium-sized intelligent handling“FANUC Robot M-20iB/25 series,” a model with enhanced dustproof, waterproof and rustproof performance was developed. Sales of such robots are
expected to expand into various fields including thefood and pharmaceutical industries.

R－２０００i C

With such new products and new functions, therange of application of FANUC robots is anticipated
to expand further.

M－２０i B

6

FANUC CORPORATION ANNUAL REPORT 2017

ROBOMACHINE Business Division
Sales of the ROBODRILL (compact machining center)remained steady for automobile and motorcycle
parts processing, and short-term IT-related demandbegan to show some movement from the fourth
quarter. However, sales declined compared with theprevious fiscal year when there was a strong contribution from short-term IT-related demand.
On the development front, the “FANUC ROBODRILL
α-DiB series,” which has a completely new CNC
screen, shortens cycle time and has a high performance specification model added to its lineup, wasdeveloped as a successor model to the “FANUC ROBODRILL α-DiA series.” This series has already beenwell-received by the market.
Demand for the ROBOSHOT (electric injection molding machine) remained unchanged except in the ITrelated field, but overall sales decreased slightly as
IT-related demand failed to bring about full-fledged
recovery.
In the electric injection molding “FANUC ROBOSHOT α-SiA series,” the horizontal second injection
unit called “FANUC ROBOSHOT SI-300HA” was developed. With this model, relatively large-size moldings can be supported, and combining it with thevertical second injection unit, “FANUC ROBOSHOT
SI-20A” enables “three components molding.”
This in turn is expected to further broaden the scopeof its applications.
Sales of the ROBOCUT (wire-cut electric dischargemachine) remained unchanged. The total of accumulated shipment volume surpassed 30,000 units in
March 2017.
On the development front, the “FANUC ROBOCUT
α-CiB series” was developed as a successor modelto the wire-cut electric discharge machine “FANUC
ROBOCUT α-CiA series.” The basic performancewas enhanced and large-size specification models
were added to the lineup to enable large die machining, thus expanding the scope of its applications.
This series has already been well received by themarket.
As for the ROBONANO (ultra precision machine),
the ultra precision “FANUC ROBONANO α-NMiA,” amachining system which adopts FANUC’s latest FA
technology, was developed. This machine has greatly improved machining surface accuracy and surface
quality compared with the previous model, and thescope of its applications is highly expected to expand commensurate with the expanded machining
area of work.

ROBODRILLROBOSHOTROBOCUTROBONANO

7

Management Policy

Basic Management Policy
FANUC was the first private company to succeed in the development of NC’s and servomechanism inJapan, and ever since this success in 1956, has consistently pursued automation in factories.
With its three pillars consisting of the FA business, which comprises FANUC’s basic technologyof NC and servos, the ROBOT and ROBOMACHINE businesses which apply this basic technology,
FANUC contributes to the manufacturing industry in Japan and overseas by promoting automationand efficiency in manufacturing.

Three Key Words of FANUC

The three businesses of FA, ROBOT and
ROBOMACHINE are unified with SERVICE
as “one FANUC”, to provide innovation andreassurance to manufacturing sites around theworld.

Reliable
Predictable
Easy to repair

FANUC aims
to minimize downtime
in all factories all over the world.

Conforming to the spirit of “Service First”,
FANUC provides lifetime maintenance toits products for as long as they are used bycustomers, through more than 250 service
locations in 45 countries throughout the world.

8

FANUC CORPORATION ANNUAL REPORT 2017

History of FANUC
1956
1959
1972


1974

1975
1977

1978

1980
1982

1984

1985
1986


1987
1989
1992


1997
1999
2003

2009

2012
2013
2015

2016

The first NC and SERVO systems in the Japanese private sector were developed successfully.
The first electro-hydraulic pulse motor was developed.
FANUC was established.
CNC was introduced.
NC Drill was developed.
ROBOTs were developed and installed in FANUC factories.
The production and sale of DC SERVO MOTORs were started under GETTYS MANUFACTURING., INC license.
Wire-cut electric discharge machine was completed.
FANUC USA CORPORATION was established.
The commercial production and shipment of ROBOTs started (ROBOT-MODEL1).
KOREA NUMERIC CORPORATION was jointly established by FANUC and Hwacheon Machinery Works, Co. Ltd.
FANUC EUROPE S.A. was established.
The Fuji Factory was completed.
GMFanuc Robotics Corporation was jointly established in the U.S.A. by FANUC and General Motors.
AC SERVO MOTOR was developed.
FANUC headquarters was moved to the foot of Mt. Fuji.
All-electric plastics injection molding machine, “FANUC AUTOSHOT” was developed.
FANUC series 0 was developed.
FANUC TAIWAN Corporation was established.
GE Fanuc Automation Corporation was jointly established in the U.S.A. by FANUC and General Electric.
Digital SERVO was completed.
CO2 LASER was developed.
The Tsukuba Factory was constructed.
GMFanuc Robotics Corporation was restructured to FANUC’s wholly owned share holding company, FANUC Robotics Corporation, together with its subsidiaries.
BEIJING-FANUC Mechatronics CO., LTD was jointly established by FANUC and the Beijing Machine Tool Research Institute.
FANUC INDIA PRIVATE LIMITED was established.
SHANGHAI-FANUC Robotics CO., LTD. was jointly formed in China by FANUC and Shanghai Mechanical & Electric Industrial
Investment Corp.
The commercial production of 16i Series CNC started.
The commercial production of intelligent ROBOTs started.
The commercial production of 30i Series CNC started.
The joint venture with General Electric Company was resolved and the joint venture’s FA operations in the Americas weretransferred to FANUC America Corporation.
The commercial production of the Genkotsu-Robot, a Parallel Link Robot, started.
European subsidiaries were reorganized, and FANUC Europe Corporation was established.
Subsidiaries in North and South America were reorganized, and FANUC America Corporation was established.
Collaborative ROBOT CR-35 A was developed.
FIBER LASER was developed
The Mibu Factory was completed

800

Sales

537

700

(Billions of Yen)

600
500
400
300
200
100

72

74

76

78

80

82

84

86

88

90

92

94

96

98

00

02
04
06
08
10
12
14
16 17
Consolidated from the year ended March 31,1983

0

9

CORPORATE GOVERNANCE

Fundamental Concept of Corporate GovernanceWe ensure the practice of the principle, “preciseness and transparency,” which has been the principle of
FANUC since its foundation. We think it is important for the practical functioning of governance to share suchan easy-to-understand and simple principle among all officers and employees of the Group.

About “Preciseness and Transparency”
PrecisenessThe permanence and soundness of a company are created by preciseness.
Transparency
The corruption of an organization and the collapse of a company start from opacity.
By establishing a specific code of conduct while practicing “preciseness and transparency,” we will makeefforts to maintain a high level of awareness of officers and employees of our Group into the future.

Organizational Structure
As we are surrounded by a very rapidly changing business environment, unless the Board of Directors
understands accurate information about customer and market trends, service status, etc., the Board will not
be able to make appropriate managerial decisions. Due to these circumstances, in principle, our directors
other than outside directors execute the business of our company, aiming at a system where directors are
involved in daily operations themselves, acquire accurate information themselves, and mutually share suchinformation among the members of the Board of Directors. Furthermore, we have chosen to be a company
with Audit & Supervisory Board, as an organizational design that can make best use of these characteristics.

Directors and Audit & Supervisory Board Members
Member of the Board (13 in total, including 3 outside directors)
Representative Member of the Board, Chairman and CEO
Dr. Yoshiharu Inaba
Representative Member of the Board, President and COO
Kenji Yamaguchi (General Manager, FA Business Division)
Representative Member of the Board, Senior Executive Vice President and CTO
Hiroyuki Uchida (General Manager, ROBOMACHINE Business Division)
Representative Member of the Board, Senior Executive Vice President and CFO
Yoshihiro Gonda (General Manager, Corporate Administration Division)
Member of the Board, Executive Vice President
Dr. Kiyonori Inaba (General Manager, ROBOT Business Division)
Hiroshi Noda (Vice General Manager (R&D), FA Business Division)
Katsuo Kohari (Vice General Manager (Sales), FA Business Division, General Manager, Service Division)
Shunsuke Matsubara (General Manager, Research & Development Administration Division)Toshiya Okada (Vice General Manager, Corporate Administration Division, General Manager, Legal Division)
Member of the Board
Richard E. Schneider (Chairman, FANUC America Corporation)
Kazuo Tsukuda (Outside)
Yasuo Imai (Outside)
Masato Ono (Outside)
Audit & Supervisory Board Members (5 in total, including 3 outside Audit & Supervisory Board Members)
Shunsuke Kimura
Naoki Shimizu
Dr. Takeo Nakagawa (Outside)
Masaharu Sumikawa (Outside)
Hajime Harada (Outside)10

FANUC CORPORATION ANNUAL REPORT 2017

Outside Directors and Outside Audit & Supervisory Board Members
Outside Directors

Reason for appointment

Kazuo Tsukuda

In order to develop the Company’s business steadily and to enhance its corporate value, it is quite effective to introduce to the Board of Directors
an outsider’s eye with a broad perspective and excellent insight. Kazuo Tsukuda has been providing the Company with extremely valuable advice,with his outstanding knowledge of manufacturing and extensive experience in management, having a deep understanding of the Company’sbusiness. He will be expected to continue to contribute to the Company’s Board of Directors from an independent position as Outside Director.

Yasuo Imai

After joining in the Ministry of International Trade and Industry (currently, the Ministry of Economy, Trade and Industry), Yasuo Imai had experienceof being posted overseas as General Manager of the Washington Office of Japan National Oil Corporation. He successfully held a number of
positions starting from the post of Deputy Director-General, Director-General of the Petroleum Department of Agency for Natural Resources andEnergy. Subsequently he moved to the post of Director-General of the Manufacturing Industries Bureau, and then to the post of Commissionerof the Japan Patent Office. Based on these experiences, Yasuo Imai, being familiar with foreign affairs, has a global perspective and extensive
knowledge concerning the manufacturing industry and the protection of intellectual property, etc. At the same time, he is currently an active
corporate executive and is also knowledgeable about corporate management due to having more than 10 years’ experience in business. Yasuo Imai
has been providing the Company with extremely valuable advice as Outside Director with his extensive experience in various fields and from his
broad vision. He will be expected to continue to contribute to the Company’s Board of Directors from an independent position as Outside Director.

Masato Ono

Our company has specialized in business activities in the narrow field of the automation of manufacturing and as such, the Board of Directors
consists mostly of Directors with engineering background focusing on its core business. Given this context, Masato Ono has been providing theCompany with extremely valuable advice on enhancing corporate value from a totally different point of view by contributing to active discussions
at the meeting of the Board of Directors based on his many years of experience in management of financial institutions. Although Masato Ono
has served as Deputy President and Representative Director of Mizuho Financial Group, Inc., he meets the Company’s criteria for independenceof Outside Directors and Outside Audit & Supervisory Board Members (see the section “Independent Directors/Audit & Supervisory Board
Members”), (The Company has never applied for a loan from any bank of Mizuho Financial Group.), it has been over 9 years since he retired
as Director of the Mizuho Financial Group, Inc., and there is no risk of his independence being affected by this position. He will be expected tocontinue to contribute to the Company’s Board of Directors from an independent position as Outside Director.

Outside Audit &Supervisory Board
Members

Reason for appointment

Takeo Nakagawa

As Professor Emeritus of the University of Tokyo and a corporate manager, Takeo Nakagawa has been consistently engaged in “monozukuri(manufacturing).” For this reason, he has given us objective and valuable advice from various aspects based on his profound understanding of theCompany’s business. We believe that we can expect him to continue to play a significant role going forward.

Masaharu Sumikawa

We expect him to provide advice whenever necessary, based on his wide experience, expertise and knowledge he had obtained as a longserving corporate executive.

Hajime Harada

Hajime Harada has been providing the Company with extremely valuable advice whenever necessary based on his wide experience andknowledge as a lawyer.
Although his term of office as Outside Audit & Supervisory Board Member of the Company has reached 13 years as of the end of June 2017,
he meets the Company’s criteria for independence of Outside Directors and Outside Audit & Supervisory Board Members (see the section“Independent Directors/Audit & Supervisory Board Members”) and has no business transactions with or interest in the Group As a lawyer, Hajime
Harada has a responsibility under the Basic Rules on the Duties of Practicing Attorneys to “maintain his or her freedom and independence”(Article 20 of the Rules) and to “perform his or her duties fairly” (Article 5), and in fact he gives his frank opinion from an independent standpoint.
We therefore believe that he maintains sufficient independence now and in the future. In particular, he has a deep understanding of corporate
governance, an issue that has grown increasingly important in recent years, gained through his experience including service as a lawyer oncompliance committees at another listed company for many years. Furthermore, he has advanced, wide-ranged and specialized knowledge,
based on his experience including court cases in a variety of fields such as systems development, intellectual property rights, antimonopoly
law, international joint ventures, and claims collection. For these reasons, we can expect him to continue to offer appropriate advice from an
extremely broad perspective with regard to risks that the Company may face in the future and other matters.

Criteria for Independence of Outside Directors and Outside Audit & Supervisory Board Members
With regard to Independent Outside Directors and Outside Audit & Supervisory Board Members, the Company nominates candidates
who do not have any certain interest in the Company, and who can be expected to make frank comments without hesitation at Boardof Directors meetings, etc. Furthermore, in order to ensure such real independence, as minimum requirements, candidates must meeteach of the following conditions.
1. Business transactions between the Company and the company from which the candidate comes must amount to less than 2% of therespective consolidated sales of both companies.
2. The Company must not have any loans from the company from which the candidate comes (if the candidate comes from a bank.)
3. The Company must not have any important transactions such as advisory contracts with the candidate or the firm he works for (ifthe candidate is a lawyer or other professional.)
4. The candidate must not come from the audit firm that is the Company’s Accounting Auditor.
5. There must be no other particular reasons that could give rise to a conflict of interest with the Company.
6. The candidate must not be the spouse or a relative within the second degree of anyone who does not meet the above conditions
1 through 5.

11

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FANUC CORPORATION ANNUAL REPORT 2017

Financial Section
TEN-YEAR FINANCIAL SUMMARY･･･････････････････････････････ 14
CONSOLIDATED STATEMENTS OF INCOME････････････････････ 16
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME･･･ 17
CONSOLIDATED BALANCE SHEETS･････････････････････････････ 18
CONSOLIDATED STATEMENTS OF CHANGES IN NET ASSETS･･･ 19
CONSOLIDATED STATEMENTS OF CASH FLOWS･･･････････････ 20
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS･････ 21
NON-CONSOLIDATED STATEMENTS OF INCOME･ ･････････････ 34
NON-CONSOLIDATED BALANCE SHEETS･ ･･････････････････････ 35

13

Ten-Year Financial Summary

2008

2009

2010

2011

¥ 468,399¥ 388,271¥ 253,393¥ 446,201

189,564

134,449

55,024

189,757

40.5%

34.6%

21.7%

42.5%

Income before income taxes

211,875

149,148

55,826

193,495

Net income attributable to owners of parent

127,030

97,16237,511

120,155

Current assets

750,328

683,719

623,573

753,992

Current liabilities

104,151

55,72556,18889,589Total assets

1,046,837

970,441

891,651

1,013,000

Net assets

911,395

893,282

812,657

894,494

611.14467.55187.75613.75————183.35140.2756.33

184.134,225.39

4,177.28

4,133.89

4,550.71

Years ended March 31

Net sales
Operating income
Operating income as a percentage of net sales

Per share data (Yen and U.S. Dollars):

Net income:
Basic
DilutedCash dividends
Net assets

Note : The U.S. dollar amounts shown above and elsewhere in this annual report are converted from yen, for the readers’convenience, at the rate of ¥112 = U.S.$1.00.

14

FANUC CORPORATION ANNUAL REPORT 2017

Millions of yen, except for per share data

Thousands of
U.S. dollars,
except for per share data

2012

2013

2014

2015

2016

2017

2017

¥ 538,492¥ 498,395¥ 450,976¥ 729,760¥ 623,418¥ 536,942$ 4,794,125

221,834

184,821

164,134

297,839

215,567

153,217

1,368,008

41.2%

37.1%

36.4%

40.8%

34.6%

28.5%

28.5%

228,578

191,242

174,360

311,951

229,361

168,829

1,507,401

138,819

120,484

110,930

207,599

159,700

127,697

1,140,152

848,669

906,440

1,027,801

1,273,355

1,072,770

1,059,644

9,461,108

115,270

92,97399,449172,611106,116

120,715

1,077,812

1,130,625

1,219,113

1,343,904

1,611,626

1,512,895

1,564,769

13,971,152

985,322

1,094,129

1,199,863

1,386,695

1,334,910

1,369,457

12,227,295

709.20615.59566.86

1,061.02

816.78658.63

5.88

—

—

—

—

—

—

—

212.77184.68170.06636.62490.07395.183.53

5,013.69

5,565.64

6,102.20

7,049.39

6,825.27

7,031.79

62.78

15

Consolidated Statements of Income

Thousands of
U.S. dollars(Note 3)

Millions of yen

2015

2016

2017

2017

¥ 729,760¥ 623,418¥ 536,942$4,794,125

350,746

326,912303,415

2,709,063

379,014

296,506

233,527

2,085,062

81,17580,93980,310717,054

297,839

215,567

153,217

1,368,008

Interest income

2,628

2,537

2,343

20,920Equity in earnings of affiliates

9,886

11,494

10,022

89,482Other, net (Note 10)

1,598

(237)

3,247

28,991

14,112

13,794

15,612

139,393311,951

229,361

168,829

1,507,401

Current

111,261

66,12347,736426,214

Deferred(8,162)

2,906(6,684)(59,679)

Net income

208,852

160,332

127,777

1,140,866

1,253

632

80

714

¥ 207,599¥ 159,700¥ 127,697$1,140,152

Years ended March 31

Net sales
Cost of goods sold (Note 9)
Gross profit
Selling, general and administrative
expenses (Note 9)
Operating income

Other income (expenses):

Income before income taxes
Income taxes:

Net income attributable tonon-controlling interests
Net income attributable to owners of parent

U.S. dollars(Note 3)

Yen

Amounts per share of common stock:

Net income
Cash dividends
See notes to the consolidated financial statements.

16¥ 1,061.02
636.62¥

816.78490.07¥

658.63395.18

$

5.88
3.53

FANUC CORPORATION ANNUAL REPORT 2017

Consolidated Statements of Comprehensive Income

Thousands ofMillions of yen

U.S. dollars

2015

2016

2017

2017

¥208,852¥160,332¥127,777$1,140,866

Valuation difference on availablefor-sale securities

2,370(3,091)

4,203

37,527

Foreign currency translation adjustment

22,178(21,866)(2,076)(18,536)

Remeasurements of defined benefit
plans(2,736)(15,337)(443)(3,955)

Share of other comprehensive
income of affiliates accounted forusing equity method

4,687(2,085)(4,527)(40,420)

Total other comprehensive income

26,499(42,379)(2,843)(25,384)¥235,351¥117,953¥124,934$1,115,482

233,467

117,873

124,774

1,114,054

1,884

80

160

1,428

Years ended March 31

Net income
Other comprehensive income

Comprehensive income
Comprehensive income attributable to:
Owners of parent
Non-controlling interests

17

Consolidated Balance Sheets
Millions of yen

As of March 31

ASSETS
Current assets:
Cash and bank deposits
Receivables, trade:
Notes and accounts
Allowance for doubtful accounts
Marketable securities
Finished goods
Work in progress
Raw materials and supplies
Deferred income taxes (Note 11)
Other current assets
Total current assets
Investments (Note 5)
Property, plant and equipment, at cost:
Land
Buildings
Machinery and equipment
Construction in progress
Less accumulated depreciation
Property, plant and equipment, net
Intangible assets:
Goodwill
Other intangible assets
Total intangible assets
Total assets
LIABILITIES AND NET ASSETS
Current liabilities:
Payables, trade
Accrued income taxes
Warranty reserves
Other current liabilities
Total current liabilities
Long-term liabilities:
Net defined benefit liability (Note 6)
Other long-term liabilities
Total long-term liabilities
NET ASSETS
Shareholders’ equity:
Common stock:
Authorized - 400,000,000 shares
Issued - 204,072,715 shares
Capital surplus
Retained earnings
Treasury stock, at cost :2016 - 11,300,237 shares2017 - 10,216,648 shares
Total shareholders’ equity
Accumulated other comprehensive income:
Valuation difference on available-for-sale securities
Foreign currency translation adjustment
Remeasurements of defined benefit plans
Total accumulated other comprehensive income
Non-controlling interests
Total net assets
Total liabilities and net assets
See notes to the consolidated financial statements.

18

Thousands of
U.S. dollars(Note 3)

2016

2017

2017

¥686,662¥629,761$5,622,866

100,307(1,568)145,000
52,736
39,206
11,124
23,107
16,196
1,072,770
84,190120,787(1,287)145,000
60,58043,892
13,864
24,384
22,663
1,059,644
94,0481,078,455(11,491)
1,294,643
540,893
391,893
123,786
217,714202,349
9,461,108
839,714

131,800
232,538
154,216
85,917(252,411)
352,060

134,400
339,090
184,80922,015(273,924)
406,390

1,200,000
3,027,589
1,650,080
196,563(2,445,750)
3,628,482

—
3,875
3,875
¥1,512,895

—
4,687
4,687
¥1,564,769—
41,84841,848$13,971,152¥24,815
17,1996,676
57,426106,116¥36,01122,994
6,994
54,716
120,715$321,527
205,304
62,445488,536
1,077,812

68,346
3,523
71,86971,175
3,422
74,597635,491
30,554
666,045

69,01496,206
1,269,557

69,01496,2081,307,254

616,196
859,000
11,671,911(90,574)—
1,344,203—(90,677)
1,381,799—(809,616)
12,337,491

4,391
5,974
(26,085)(15,720)
6,427
1,334,910¥1,512,895

8,594
(710)
(26,528)(18,644)
6,302
1,369,457¥1,564,769

76,732(6,339)(236,857)(166,464)
56,268
12,227,295$13,971,152

FANUC CORPORATION ANNUAL REPORT 2017

Consolidated Statements of Changes in Net Assets
Millions of yen

Commonstock
Balance at March 31, 2014
Cumulative effects of changes
in accounting policies
Restated balance
Cash dividends
Net income
Purchase of treasury stock
Disposal of treasury stock
Retirement of treasury stock
Change of scope of consolidation
Change in equity from transactions
with non-controlling shareholders
Net change except shareholder’sequity during the year
Balance at March 31, 2015
Cumulative effects of changes
in accounting policies
Restated balance
Cash dividends
Net income
Purchase of treasury stock
Disposal of treasury stock
Retirement of treasury stock
Change of scope of consolidation
Change in equity from transactions
with non-controlling shareholders
Net change except shareholder’sequity during the year
Balance at March 31, 2016
Cumulative effects of changes
in accounting policies
Restated balance
Cash dividends
Net income
Purchase of treasury stock
Disposal of treasury stock
Retirement of treasury stock
Change of scope of consolidation
Change in equity from transactions
with non-controlling shareholders
Net change except shareholder’sequity during the year
Balance at March 31, 2017

¥69,014¥69,014¥96,270 ¥1,340,809

Valuation
Foreign RemeasureNonTreasury
difference on currency
ments
Total
controllingstock,
available-for- translation of defined
net assets
at costinterests
sale securities adjustment benefit plans(¥312,299)¥5,112¥3,138(¥8,012)¥5,831 ¥1,199,863(1,452)(1,452)

CapitalsurplusRetainedearnings¥96,270 ¥1,339,357 (¥312,299)(46,559)
207,599(559)
7
3¥5,112¥3,138(¥8,012)238¥5,831 ¥1,198,411(46,559)
207,599
(559)
10
—
238
—

¥69,014¥96,277 ¥1,500,635(¥312,855)

2,370

26,234(2,736)¥7,482¥29,372(¥10,748)

1,687

27,555¥7,518 ¥1,386,695—¥69,014¥96,277 ¥1,500,635 (¥312,855)(151,385)
159,700(17,194)74(78) (239,393)
239,471¥7,482¥29,372(¥10,748)¥7,518 ¥1,386,695(151,385)
159,700(17,194)
11———¥69,014¥96,206 ¥1,269,557(¥90,574)(3,091)(23,398)(15,337)(1,091)(42,917)¥4,391¥5,974(¥26,085)¥6,427 ¥1,334,910—¥69,014¥96,206 ¥1,269,557(76,623)
127,6972(2)(13,377)(¥90,574)¥4,391¥5,974(¥26,085)(13,483)1
13,379¥6,427 ¥1,334,910(76,623)
127,697(13,483)3——

2¥69,0142¥96,208 ¥1,307,254(¥90,677)

4,203(6,684)(443)¥8,594(¥710)(¥26,528)(125)(3,049)¥6,302 ¥1,369,457

Thousands of U.S. dollars (Note 3)

Commonstock
Balance at March 31, 2016
Cumulative effects of changes
in accounting policies
Restated balance
Cash dividends
Net income
Purchase of treasury stock
Disposal of treasury stock
Retirement of treasury stock
Change of scope of consolidation
Change in equity from transactions
with non-controlling shareholders
Net change except shareholder’sequity during the year
Balance at March 31, 2017

$616,196

CapitalsurplusRetainedearnings$858,982 $11,335,330

Valuation
Foreign RemeasureNonTreasury
difference on currency
ments
Total
controllingstock,
available-for- translation of defined
net assets
at costinterests
sale securities adjustment benefit plans($808,696)$39,205$53,340 ($232,902)$57,384 $11,918,839—$616,196$858,982 $11,335,330(684,134)
1,140,152
18(18)(119,437)($808,696)$39,205$53,340($232,902)(120,384)
9
119,455$57,384 $11,918,839(684,134)
1,140,152(120,384)
27
—
—

18

$616,196$859,000 $11,671,911

See notes to the consolidated financial statements.

18($809,616)

37,527(59,679)(3,955)$76,732($6,339)($236,857)(1,116)(27,223)$56,268 $12,227,295

19

Consolidated Statements of Cash Flows
Thousands of
U.S. dollars(Note 3)

Millions of yen

2015

2016

2017

2017

¥311,951¥229,361¥168,829$1,507,401

21,685223
6,081(3,665)(9,886)(37,331)(17,712)
11,723
1,266
284,335
6,379(68,891)
1,089
222,912

21,106(536)
21,311(3,909)(11,494)
29,207
1,602(13,749)(21,506)
251,393
10,061(121,281)460
140,633

26,530(239)
3,178(3,789)(10,022)(17,386)(16,519)
11,292(6,470)155,404
8,562(43,039)786
121,713

236,875(2,134)28,375(33,830)(89,482)(155,232)(147,491)
100,822(57,768)
1,387,536
76,446(384,277)
7,017
1,086,722

Cash flows from investing activities
Purchases of property, plant and equipment
Purchases of investment securities
Proceeds from sales of investment securities
Other
Net cash used in investing activities(21,427)(3,355)1(145)(24,926)(102,008)(7,830)—(2,839)(112,677)(87,509)
(559)
—
(494)
(88,562)(781,330)(4,991)—(4,411)(790,732)

Cash flows from financing activities
Purchases of treasury stock
Dividends paid
Other
Net cash used in financing activities(549)(46,568)(197)(47,314)(17,253)(151,237)(1,082)(169,572)(13,481)(76,505)(281)(90,267)(120,366)(683,080)(2,509)(805,955)

16,425(17,958)

215

1,920

167,097
823,669(159,574)
991,236(56,901)
831,662(508,045)
7,425,554

470

—

—

—

¥991,236¥831,662¥774,761$6,917,509

Years ended March 31

Cash flows from operating activities
Income before income taxes
Adjustments to reconcile income
before income taxes to net cash
provided by operating activities:
Depreciation and amortization
Allowance for doubtful accounts
Net defined benefit liability
Interest and dividend income
Equity in earnings of affiliates, net(Increase) decrease in receivables, trade(Increase) decrease in inventories
Increase (decrease) in payables, trade
Other
Cash generated from operations
Interest and dividends received
Income taxes paid
Other
Net cash provided by operating activities

Effect of exchange rate changes on cash
and cash equivalents
Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of year
Increase in cash and cash equivalentsfrom newly consolidated subsidiaries
Cash and cash equivalents at end of year
See notes to the consolidated financial statements.

20

FANUC CORPORATION ANNUAL REPORT 2017

Notes to the Consolidated Financial Statements

1. Basis of preparation
The accompanying consolidated financial statements of FANUC CORPORATION (the “Company”) and its consolidated subsidiaries (together, the“Group”) are prepared on the basis of accounting
principles generally accepted in Japan, which are
different in certain respects as to the applicationand disclosure requirements of International Financial Reporting Standards, and have been compiled from the consolidated financial statements
prepared by the Company as required by the Financial Instruments and Exchange Law of Japan.
In addition, the notes to the consolidated financial statements include information which is
not required under accounting principles generally accepted in Japan but is presented herein
as additional information.
In preparing the accompanying consolidated
financial statements, the Company has madecertain reclassifications and rearrangements tothe consolidated financial statements preparedin Japan in order to present them in a format
which is more familiar to readers outside Japan.

2. Summary of significant accounting policies(b) Cash equivalents
The Group considers all highly liquid investmentswith a maturity of three months or less when purchased to be cash equivalents.
(c) Translation of foreign currency accounts
All monetary receivables and payables denominated in foreign currencies are translated into
Japanese yen at the exchange rates in effect atthe balance sheet date. Foreign exchange gainor loss on translation is recognized in the consolidated statements of income.
Assets and liabilities of the consolidated subsidiaries outside Japan are translated into Japanese yen at the applicable year-end rates except
for shareholders’ equity which is translated at thehistorical rates. Differences arising from translation are reflected as “Foreign currency translation
adjustments” in a separate component of net assets. Income and expense accounts are translated at the average rates for the year.
(d) Valuation of securities
Securities other than investments in affiliates areclassified as available-for-sale securities (“Other
securities”) and include securities other than(a) Principles of consolidation

trading securities and securities held to maturity.

The consolidated financial statements include the

Other securities whose fair value is readily deter-

accounts of the Company and, with minor excep-

minable are stated at fair value with the corre-tions, the subsidiaries under its control. Intercom-

sponding unrealized gain or loss, net of taxes,

pany accounts and significant intercompany

recorded directly as a separate component oftransactions have been eliminated in consolida-

net assets. Other securities whose fair value istion.

not readily determinable are stated at moving

The investments in unconsolidated subsidiaries
and affiliated companies over which the Company

average cost. The cost of other securities sold is
calculated by the moving average method.

exerts substantial influence are, with minor exceptions, stated at their underlying equity value.
Goodwill is amortized over a period of five
years.

(e) Allowance for doubtful accounts
The allowance for doubtful accounts is provided
at an amount deemed sufficient to cover estimated future losses.

21

(f) Inventories

Past service cost is being amortized as incurred

Raw materials and purchased components areby the straight-line method over a period (10 years)

stated primarily at cost determined by the mostwhich is shorter than the estimated average

recent purchase price method.

remaining years of service of the eligible employees.

Work in progress is stated at actual cost which includes direct costs for materials and labor and over-(j) Revenue recognition

head manufacturing costs including depreciation.

In general, sales of products, other than those ex-

Finished goods are stated principally at cost(the valuation method) by the average method.

ported, are recognized in the accounts upon acceptance by the customers. Export sales arerecognized as of the respective dates of ship-(g) Property, plant and equipment and depreciation

ment.

Property, plant and equipment, including significant renewals and additions, is stated at cost.

(k) Income taxes

Depreciation is computed principally by theDeferred income taxes are provided by the asset

declining-balance method at rates based on theand liability method. Deferred income tax assets

estimated useful lives of the respective assets

and liabilities are determined based on the tem-

which vary according to general classification,

porary differences between the financial state-type of construction and use.

ments and the tax bases of the assets andMaintenance and repairs, including minor re-liabilities, using the enacted tax rates which will

newals and improvements, are charged to in-

be in effect during the years in which the differ-come as incurred.

ences are expected to reverse.

(h) Warranty reserves(l) Net income per share

The Group provides warranty reserves for goods

Net income per share is calculated based on thesold under warranty agreements. Estimates fornet income available for distribution to share-

these warranty reserves are based primarily on

holders of common stock and the weighted-av-

historical experience. In addition, they are calcu-

erage number of shares of common stock

lated with reference to current information con-outstanding during the year.

cerning specific issues.
(m) Shareholders’ equity

22(i) Retirement benefits

The Companies Act of Japan provides that an

The benefit formula basis is applied as theamount equal to 10% of the amount to be disbursed

method for attributing the expected retirement

as distributions of capital surplus (other thanbenefits to periods of service for the calculation

capital reserve) and retained earnings (otherof the retirement benefit obligation.

than legal reserve) be transferred to capital re-Actuarial gain or loss is amortized in the year

serve and legal reserve, respectively, until thefollowing the year in which the gain or loss is

sum of the capital reserve and the legal reserve

recognized primarily by the straight-line method

equals 25% of the capital stock account. Such dis-over a period (10 years) which is shorter than thetributions can be made at any time by resolution

estimated average remaining years of service ofof the shareholders or by the Board of Directors

the eligible employees.

if certain conditions are met.

FANUC CORPORATION ANNUAL REPORT 2017

3. U.S. dollar amounts
The Company and its domestic consolidated subsidiaries maintain their books of account in yen.
The U.S. dollar amounts included in the accompanying consolidated financial statements and thenotes thereto represent the arithmetic results oftranslating yen into dollars at ¥112 = U.S.$1.00,
the approximate rate of exchange prevailing on
March 31, 2017.
U.S. dollar amounts are presented solely forthe convenience of the reader and the translation is not intended to imply that assets and liabilities which originate in yen have been or could
readily be converted, realized or settled in U.S.
dollars at the above or any other rate.

4. Financial instruments

relationships, are exposed to the risk of market
price fluctuations.
Payables such as trade notes and trade accounts are mostly due within one year.
(3) Risk management for financial instruments( i ) Management of credit risk
The Group monitors due dates and manages
balances of receivables by customer according
to internal guidelines and periodically checks
credit risks of key customers taking into account their financial position and other factors.
( ii ) Management of market risk
The Group regularly monitors the market priceand the financial condition of the issuer withrespect to its securities and continuously reviews the investment made in each company,

Basic policy to manage financial instruments andtaking into account its relationship with the coun-

related risk

terparty.

(1) Group policy for financial instruments
The Company and its consolidated subsidiaries relyon their own resources to finance operations anddo not raise funds from external resources.
In addition, they do not enter into any derivative contracts.
(2) Nature and extent of risks arising from financial instruments
Receivables such as trade notes and trade accounts are exposed to customer credit risk andreceivables denominated in foreign currencies
that arise from overseas operations are exposedto the market risk of fluctuation in foreign currency exchange rates. Marketable securities are negotiable certificate of deposits, which are easily
convertible into cash and within three months,
and thus are exposed to insignificant risk of pricefluctuations. Investment securities, which mainly
consist of stocks in companies with business23

Fair value of financial instruments
The carrying amount and fair value of financial instruments at March 31, 2016 and 2017 are summarized
as follows. Financial instruments whose fair value is not readily determinable are not included in thetable below.
2016

Millions of yen

Carrying
amountFair
value

Cash and bank deposits¥686,662¥686,662—

Notes and accounts receivables

100,307

100,307—

Marketable securities and investment securities
Other securities

162,582

162,582—

Notes and accounts payables(24,815)(24,815)—

Accrued income taxes(17,199)(17,199)—

2017

Variance

Millions of yen

Thousands of U.S. dollars

Carrying
amountFair
value

Cash and bank deposits¥629,761¥629,761—$5,622,866 $5,622,866—

Notes and accounts receivables

120,787

120,787—

1,078,455

1,078,455—

168,156

168,156—

1,501,393

1,501,393—

Notes and accounts payables(36,011)(36,011)—(321,527)(321,527)—

Accrued income taxes(22,994)(22,994)—(205,304)(205,304)—

Variance

Carrying
amountFair
value

Variance

Marketable securities and investment securities
Other securities

Cash and bank deposits, Notes and accounts receivable
The carrying value of cash and bank deposits and notes and accounts receivables approximate fairvalue due to their short maturities.
Marketable securities and investment securities
Marketable securities are negotiable certificates of deposit (NCD), and the carrying value of those
approximate fair value due to their short maturities.
Investment securities are equity securities whose fair value is measured at the quoted market
price at the stock exchange.
See Note 5 for information on the fair value of investment securities by classification.
Notes and accounts payables
The carrying value of notes and accounts payables approximate fair value due to their shortmaturities.

24

FANUC CORPORATION ANNUAL REPORT 2017

The carrying amount of financial instruments whose fair value is not readily determinable at March
31, 2016 and 2017, is as follows:
Thousands of
U.S. dollars

Millions of yen

Unlisted stock(consolidated balance sheet amount)

2016

2017

2017

¥48,227¥49,039$437,848

Redemption schedule after fiscal year-end for monetary assets and securities with maturity dates asof March 31, 2016 and 2017 is as follows:
2016

Millions of yen

Within 1 year

1 - 5 years

5 - 10 years

Due after
10 years

Cash and bank deposits¥686,662———

Notes and accounts receivables

100,307

—

—

—

—

—

—

—

145,000———¥931,969———

1 - 5 years

5 - 10 years

Due after
10 years¥ 629,761

—

—

—

120,787

—

—

—

—

—

—

—

145,000———¥ 895,548

—

—

—

1 - 5 years

5 - 10 years

Due after
10 yearsInvestment securities
Other securities with maturity(1) Government bond(2) Negotiable certificates of deposit
Total
2017

Millions of yen

Within 1 year
Cash and bank deposits
Notes and accounts receivables
Investment securities
Other securities with maturity(1) Government bond(2) Negotiable certificates of deposit
Total
2017

Thousands of U.S. dollars

Within 1 year
Cash and bank deposits$5,622,866

—

—

—

Notes and accounts receivables

1,078,455

—

—

—

—

—

—

—

1,294,643———$7,995,964

—

—

—

Investment securities
Other securities with maturity(1) Government bond(2) Negotiable certificates of deposit
Total

25

5. Other securities and investments
Other securities whose fair value was determinable at March 31, 2016 and 2017 are summarized as follows:
2016

Other securities
with unrealized gain
Other securities
with unrealized loss
Total
2017

Other securities
with unrealized gain
Other securities
with unrealized loss
Total
2017

Book value
Type ofreflected in the
securities
balance sheet
Equity securities¥ 17,372
Subtotal
17,372
Negotiablecertificates ofdeposit
145,000
Equity securities
210
Subtotal
145,210¥162,582

Book value
Type ofreflected in the
securities
balance sheet
Equity securities¥ 23,098
Subtotal
23,098Negotiablecertificates ofdeposit
145,000
Equity securities
58
Subtotal
145,058¥168,156

Other securities
with unrealized loss
Total

26

Acquisition
cost

Net

¥ 12,343
12,343¥5,0295,029

145,000
288
145,288¥157,631

—
(78)
(78)
¥4,951Millions of yen

Acquisition
cost

Net

¥ 12,145
12,145¥10,953
10,953145,000
59
145,059¥157,204

—
(1)
(1)
¥10,952

Thousands of U.S. dollars

Book value
Acquisitionreflected in thecostbalance sheet
Equity securities$ 206,232 $ 108,438
Subtotal
206,232
108,438
Negotiablecertificates ofdeposit
1,294,643
1,294,643
Equity securities
518
527
Subtotal
1,295,161
1,295,170$1,501,393 $1,403,608
Type ofsecurities

Other securities
with unrealized gain

Millions of yen

Net$97,794
97,794—(9)(9)$97,785

FANUC CORPORATION ANNUAL REPORT 2017

Other securities sold during the years ended March 31, 2016 and 2017 are not presented since they
are insignificant.
Investments at March 31, 2016 and 2017 consisted of the following:

Investments in affiliates
Other securities
Allowance for doubtful accounts
Other
Total

2016

Millions of yen¥46,686
19,123(1)
18,382¥84,1902017¥47,169
25,026(2)
21,855¥94,048

Thousands of
U.S. dollars

2017$421,152
223,446(18)
195,134$839,714

27

6. Retirement benefits
The Company and its domestic consolidated subsidiaries provide employees’ pension fund plans andlump-sum severance payment plans as their defined benefit pension plans.
Certain overseas consolidated subsidiaries also provide defined benefit pension plans and defined contribution pension plans.
Information on the pension plans for the years ended March 31, 2016 and 2017 is as follows;
1. Defined benefit pension plans(1) Changes in projected benefit obligation (PBO)

Thousands of
U.S. dollars

Millions of yen

2016

2017

2017

¥147,299¥178,635$1,594,955

Service cost

4,970

6,280

56,071

Interest cost

2,977

1,897

16,938Actuarial gain or loss

26,248

1,087

9,705

Benefit payments(3,798)(2,735)(24,420)

Accrued past service cost

2,519

—

—

Influence of exchange(2,366)(251)(2,241)

786

816

7,287

¥178,635¥185,729$1,658,295

PBO at beginning of year

Other
PBO at end of year
(2) Changes in the fair value of plan assets

Thousands of
U.S. dollars

Millions of yen

2017

2017

¥ 99,765¥110,289$ 984,723

Expected return on plan assets

1,871

1,144

10,214

Actuarial gain or loss

5,610

(2,394)(21,375)

Fair value of plan assets at beginning of year

Employer contribution

7,288

7,263

64,848Benefit payments(2,693)(1,648)(14,714)

Influence of exchange(1,505)

(40)

(357)

(47)

(60)

(535)

¥110,289¥114,554$1,022,804

Other
Fair value of plan assets at end of year

28

2016

FANUC CORPORATION ANNUAL REPORT 2017(3) Amount recognized in consolidated balance sheets at end of year
Millions of yen

Thousands of
U.S. dollars

PBO in savings-type pension plan

2016
¥174,726

2017¥181,973

Fair value of plan assets(110,289)(114,554)(1,022,804)

64,43767,419601,955

PBO in non-savings-type pension plan

3,909

3,756

33,536

Net amount of liability and asset recognized inconsolidated balance sheets

68,346

71,175

635,491

Net defined benefit liability

68,346

71,175

635,491¥ 68,346¥ 71,175$ 635,491

Net amount of liability and asset recognized inconsolidated balance sheets(4) Components of defined benefit costThousands of
U.S. dollars

Millions of yen

Service cost

2016

¥4,9702017$1,624,759

2017¥ 6,280

2017$56,071

Interest cost

2,977

1,897

16,938

Expected return on plan assets(1,871)(1,144)(10,214)

Amortization of actuarial gain or loss

468

2,631

23,491

Amortization of past service cost

937

776

6,929

15

13

115

¥7,496¥10,453$93,330

Other
Defined benefit cost(5) Remeasurements of defined benefit plans
The components (before adjustment of tax effect) are as follows:

Millions of yen

Past service cost2016(¥2,572)

2017

¥91

Thousands of
U.S. dollars

2017

$813

Actuarial gain or loss

(18,914)(1,007)(8,992)

Total(¥21,486)(¥916)($8,179)

29

(6) Remeasurements of defined benefit plans, before tax
The components (before adjustment of tax effect) are as follows:

Thousands of
U.S. dollars

Millions of yen

Unrecognized past service cost2016

¥2,1502017¥2,0502017$18,304

Unrecognized actuarial gain or loss

35,79436,805

328,616

Total¥37,944¥38,855$346,920

2016

2017

(7) Plan assets
1) Components of plan assets
The components are as follows:
Debt securities

74%

72%

Cash and bank deposits

25%

27%

Other

1%

1%

Total

100%

100%

2) Expected rate of return on plan assets
The expected rate of return on plan assets is determined based on the current and estimatedfuture rates of return on various pension assets.
(8) Actuarial assumptions

2016

2017

Discount rate

0.5 - 4.1%

0.5 - 4.2%

Expected rate of return on plan assets

0.5 - 3.0%

0.5 - 3.0%

Expected rate of salary increase

2.3 - 4.1%

2.3 - 4.1%

2. Defined contribution pension plans
Contribution of consolidated subsidiaries to the plan was ¥865 million for fiscal year 2015, and ¥916
million ($8,179 thousand) for fiscal year 2016.

30

FANUC CORPORATION ANNUAL REPORT 2017

7. Leases
Future rent payments, including interest, under operating leases subsequent to March 31, 2016 and2017 are summarized as follows:2016

Due within one year

Millions of yen¥1,021

2017

Thousands of
U.S. dollars

2017¥1,327$11,848

Due after one year

¥1,048¥1,498$13,375

Total¥2,069¥2,825$25,223

8. Contingent liabilities
Contingent liabilities with respect to guarantees for employees’ mortgage loans with banks at March
31, 2016 and 2017 amounted to ¥51 million and ¥36 million ($321 thousand), respectively.

9. Research and development expenses
Research and development expenses charged to manufacturing costs and selling, general and administrative expenses for the years ended March 31, 2015, 2016 and 2017 are summarized as follows:2015¥28,105

Millions of yen

2016¥34,5672017¥42,331

Thousands of
U.S. dollars

2017$377,955

10. Other income (expenses)-Other, net
Other income (expenses)-Other, net for the years ended March 31, 2015, 2016 and 2017 consistedof the following:

Dividend income
Loss on sales and disposal of fixed assets
Exchange gain or loss, net
Other, net
Total

2015

¥1,037
(906)
(43)
1,510
¥1,598Millions of yen

2016¥1,372(857)(2,090)1,338(¥ 237)2017¥1,446
(228)
517
1,512
¥3,247

Thousands of
U.S. dollars

2017$12,911(2,036)
4,616
13,500$28,99131

11. Income taxes
Net deferred tax assets at March 31, 2016 and 2017 are summarized as follows:
Millions of yen

Deferred tax assets:
Net defined benefit liability
Unrealized profit on inventories and property, plantand equipment
Accrued expenses
Depreciation and amortization
Accrued enterprise taxes
Investment securities
Other
Gross deferred tax assets
Valuation allowance
Total deferred tax assets
Deferred tax liabilities:
Undistributed earnings of affiliated companies
Other
Total deferred tax liabilities
Net deferred tax assets

Thousands of
U.S. dollars

2016

2017

2017

¥21,731¥23,380$208,750

9,380

8,860

79,107

5,418
8,222
1,169
986
9,881
56,787(995)
55,792

5,567
9,233
1,350
837
13,41462,641(847)
61,79449,70582,43812,054
7,473
119,768
559,295(7,563)551,732(11,729)(5,674)(17,403)¥38,389(9,628)(8,798)(18,426)¥43,368(85,964)(78,554)(164,518)$387,214

Reconciliation of the statutory income tax rate to the effective income tax rate for the years ended
March 31, 2015, 2016 and 2017 was as follows:

2017

2015

2016

Tax exemption(1.6%)(3.1%)(5.0%)

Dividend income not taxable(3.2%)(4.4%)(4.0%)Tax rate difference of foreign subsidiaries(1.5%)(0.5%)

0.2%

Elimination of dividends received

3.5%

4.7%

4.2%

Equity in earnings of affiliates(1.1%)(1.6%)(1.8%)

Other

1.9%

2.7%

0.5%

33.0%

30.1%

24.3%

Japanese statutory income tax rate

Effective income tax rate

35.0%

32.3%

30.2%

12. Segment information
FANUC Group focuses on the development, production and sales of CNC systems and related application products based on FANUC’s CNC system technologies as a comprehensive supplier of factory
automation (FA) systems. Ultimately, FANUC CNC systems and the related application products areused in automated production systems.
FANUC Group uses CNCs and servo motors in all of its products. For this reason, the decision is
made, taking into consideration the status of orders, sales and production of all products, in addition
to the status of particular products.
32

FANUC CORPORATION ANNUAL REPORT 2017

As mentioned above, FANUC Group runs only one business segment based on the decision thatthe entire group makes for investment. Thus, the segment information is not stated herein.

Relevant Information
Information by product and service
Net sales: Unaffiliated customers
FA
ROBOT
ROBOMACHINESERVICE
Total

2015

¥206,611¥156,497¥291,488¥ 75,164¥729,760

Millions of yen

2016¥170,211¥188,295¥183,011¥ 81,901¥623,418

2017¥175,016¥190,043¥ 93,939¥ 77,944¥536,942

Information by region
Net sales: Unaffiliated customers
Japan
America
Europe
Asia
Other
Total

2015

¥123,593¥124,057¥ 87,970¥391,577¥ 2,563¥729,760

Millions of yen

2016¥119,228¥142,700¥ 94,017¥264,629¥ 2,844¥623,4182017¥116,598¥134,915¥ 87,449¥194,698¥ 3,282¥536,942

Thousands of
U.S. dollars

2017$1,562,643$1,696,813$ 838,741$ 695,928$4,794,125

Thousands of
U.S. dollars

2017$1,041,054$1,204,598$ 780,795$1,738,375$ 29,303$4,794,125

13. Derivative transactions
Not applicable as the Group does not enter into any derivative contracts.

14. Related-party transactions
No related-party transactions were recorded for the years ended March 31, 2016 and 2017.

15. Significant subsequent events(Return of substitutional portion of employees’ pension fund)Upon resolution to return to the National Government the substitutional (future) portion of Employees’ Pension Fund at the board of representatives of the FANUC Employees’ Pension Fund held on
January 25, 2017, FANUC CORPORATION made a application to the Minister of Health, Labor andWelfare in the same month for relief from the payment obligation for the substitutional portion for
the future, and has obtained approval as of April 1, 2017. The impact, from return of the substitutional (future) portion, on the financial results for the year ending March 31, 2018 and thereafter isnegligible. The Company will carry out the procedures for return of the substitutional (past) portionof the Employees’ Pension Fund at a certain period after the above approval. The impact, from returnof the substitutional (past) portion, on the financial results is not yet determined at present.
33

NON-CONSOLIDATED STATEMENTS OF INCOME

Thousands of
U.S. dollars

Millions of yen

2015

2016

2017

2017

¥554,448¥457,479¥399,111$3,563,491

283,370258,083

246,7022,202,696

271,078

199,396

152,409

1,360,795

40,651

41,35144,430396,697

230,427

158,045

107,979

964,098

Interest income

364

561

559

4,991

Dividend income

32,41934,87925,004

223,250

Other, net

1,324(3,243)

8,191

73,134

34,10732,19733,754

301,375

264,534

190,242

141,733

1,265,473

Current

88,194

46,98935,182

314,125

Deferred(4,987)

3,169(5,842)(52,161)

83,20750,15829,340261,964¥181,327¥140,084¥112,393$1,003,509

Years ended March 31

Net sales
Cost of goods sold
Gross profit
Selling, general and administrative expenses
Operating income
Other income (expenses):

Income before income taxes
Income taxes:

Net income

Yen

Net income per share:¥ 926.74¥ 716.46

U.S. dollars¥ 579.70$Note: The U.S. dollar amounts are converted from yen, for the readers’ convenience, at the rate of ¥112 = U.S.$1.00.

34

5.18

FANUC CORPORATION ANNUAL REPORT 2017

NON-CONSOLIDATED BALANCE SHEETSAs of March 31
ASSETS
Current assets:
Cash and bank deposits
Receivables, trade:
Notes and accounts
Subsidiaries and affiliates
Allowance for doubtful accounts
Marketable securities
Inventories
Deferred tax assets
Other current assets
Total current assets
Investments and other assets:
Subsidiaries and affiliates
Deferred tax assets
Other
Total investments and other assets
Property, plant and equipment, at cost:
Land
Buildings
Machinery and equipment
Construction in progress
Accumulated depreciation
Property, plant and equipment, net
Intangible assets
Total assets
LIABILITIES AND NET ASSETS
Current liabilities:
Payables, trade:
Accounts
Subsidiaries and affiliates
Accrued expenses
Accrued income taxes
Warranty reserves
Other current liabilities
Total current liabilities
Long-term liabilities:
Allowance for employees’ retirement benefits
Asset retirement obligations
Total long-term liabilities
NET ASSETS
Shareholders’ equity:
Common stock:
Authorized - 400,000,000 shares
Issued - 204,072,715 shares
Capital surplus
Retained earnings
Treasury stock, at cost
Total shareholders’ equity
Valuation and translation adjustment:
Net unrealized holding gain on other securities
Total net assets
Total liabilities and net assets

Millions of yen

Thousands of
U.S. dollars

2016

2017

¥ 487,763¥ 431,661$ 3,854,116

36,76322,196(544)
145,000
56,888
10,135
13,564
771,765

33,11339,576(325)
145,000
66,71812,35525,420753,518

295,652
353,357(2,902)
1,294,643
595,696
110,313226,964
6,727,839

108,065
11,485
19,215
138,765

108,101
13,34925,116
146,566

965,188
119,188
224,249
1,308,625

118,378
206,648
139,077
82,226546,329(229,167)
317,1623,362¥1,231,054

120,703308,735
168,906
18,855617,199(249,472)
367,7274,060¥1,271,871

1,077,705
2,756,563
1,508,089
168,348
5,510,705(2,227,428)
3,283,277
36,250$11,355,991

¥

¥

$

16,148633
32,076
14,2782,943
2,944
69,022

25,830894
25,68919,972
2,882
3,123
78,3902017

230,625
7,982
229,366
178,32125,72927,884
699,90730,3852,840
33,22535,357
2,845
38,202

315,688
25,405341,093

69,014
96,0571,050,085(90,574)
1,124,582

69,014
96,057
1,072,478(90,677)
1,146,872

616,196857,652
9,575,696(809,616)
10,239,928

4,225
1,128,807¥1,231,054

8,407
1,155,279¥1,271,871

75,063
10,314,991$11,355,991

35

Global Service Network

FANUC Global Service Network
FANUC America(Detroit)

FANUC Europe

BEIJING-FANUCSHANGHAI-FANUC Robotics

TAIWAN FANUC■ The Americas

FANUC America Corporation

Detroit, U.S.A. Tel.248-377-7000
Chicago, U.S.A. Tel.847-898-5000
ROBOT and ROBOT system development, manufacture, sales andservices; CNC, LASER and ROBODRILL sales and services■ Europe

FANUC Europe Corporation, S.A.

Luxembourg Tel.72-7777-1
CNC, LASER, ROBOT and ROBOMACHINE sales and services;
ROBOT system development, manufacture, sales and services■ AsiaBEIJING-FANUC Mechatronics CO., LTD.

Beijing, China Tel. 10-6298-4726
CNC manufacture, sales and services; LASER sales and services

SHANGHAI-FANUC Robotics CO., LTD.

Shanghai, China Tel.21-5032-7700
ROBOT system development, manufacture, sales and services;
ROBOT and ROBOMACHINE sales and services

KOREA FANUC CORPORATION

Changwon City, Korea Tel.55-278-1200
CNC, LASER, ROBOT, ROBOT system and ROBOMACHINE sales
and services

36

TAIWAN FANUC CORPORATIONTaichung, Taiwan Tel.4-2359-9101
CNC manufacture, sales and services; LASER, ROBOT and ROBOT
system sales and services

FANUC INDIA PRIVATE LIMITED

Bangalore, India Tel.80-2852-0057
CNC manufacture, sales and services; ROBOT system development,
manufacture, sales and services; ROBOT and ROBOMACHINE sales
and services, LASER services

FANUC THAI LIMITED

Bangkok, Thailand Tel. 2-714-6111
CNC, ROBOT, ROBOT system and ROBOMACHINE sales andservices; LASER services

FANUC MECHATRONICS（MALAYSIA）SDN. BHD.

Kuala Lumpur, Malaysia Tel. 3-7628-0110
CNC, ROBOT, ROBOT system and ROBOMACHINE sales andservices; LASER services

PT. FANUC INDONESIA

Jakarta, Indonesia Tel. 21-4584-7285
CNC, ROBOT, ROBOT system and ROBOMACHINE sales andservices; LASER services

FANUC SINGAPORE PTE. LTD.

Singapore Tel. 6567-8566
CNC, LASER, ROBOT and ROBOMACHINE sales and services

FANUC CORPORATION ANNUAL REPORT 2017

FANUC Headquarters
KOREA FANUC

FANUC INDIA

FANUC THAIFANUC INDONESIAFANUC SOUTH AFRICA

FANUC PHILIPPINES CORPORATION

Manila, Philippines Tel. 2-813-3155 2-813-3156
CNC, LASER, ROBOT and ROBOMACHINE services

FANUC VIETNAM COMPANY LIMITED

Ho Chi Minh, Vietnam Tel. 28-3824-6638
CNC, LASER, ROBOT and ROBOMACHINE services

FANUC OCEANIA PTY. LIMITED

Sydney, Australia Tel. 2-8822-4600
CNC, LASER, ROBOT and ROBOMACHINE sales andservices■ South Africa

FANUC SOUTH AFRICA（PROPRIETARY）LIMITED

Johannesburg, South Africa Tel. 11-392-3610
ROBOT system development, manufacture, sales andservices; CNC, ROBOT, ROBODRILL and ROBOCUT sales
and services; LASER services

37

Web Site: http://www.fanuc.co.jp/