Consolidated Financial Results
for the Nine Monthsof the Fiscal Year Ending March 31, 2018
<under IFRS>
February 9, 2018
Company Name: Olympus Corporation
Code Number: 7733
(URL: http://www.olympus.co.jp/)
Stock Exchange Listing: First Section of Tokyo Stock Exchange
Representative: Hiroyuki Sasa, Representative Director, President
Contact: Takayuki Aoyagi, General Manager, Accounting Department
Phone: 03-3340-2111
Scheduled date to submit the Quarterly Securities Report:
February 9, 2018
Scheduled date to commence dividend payments:–
Presentation of supplementary material on quarterly financial results: Yes
Holding of quarterly financial results presentation meeting:Yes (for analysts and institutional investors)(Figures are rounded off to the nearest million yen)

1. Consolidated Financial Results for the Nine Months of the Fiscal Year Ending March 31, 2018
(From April 1, 2017 to December 31, 2017)(1) Consolidated Results of Operations (cumulative)(% indicate changes from the same period of the previous fiscal year)
Revenue

Operating profit

Nine months ended
December 31, 2017
December 31, 2016(¥ million)
572,064
531,773%
7.6–

Nine months ended
December 31, 2017
December 31, 2016

Profit attributable toowners of parent(¥ million)%
48,03721.7
39,458–(¥ million)
59,80855,966

Profit before tax%
6.9–

Total comprehensive
income(¥ million)%
68,15771.4
39,756–(¥ million)
55,70448,925

Profit%13.9–(¥ million)
48,18539,520%21.9–

Basic earnings per share

Diluted earnings per share(¥)
140.37115.30(¥)
140.31115.25(2) Consolidated Financial Position
Total assets
As ofDecember 31, 2017
March 31, 2017(¥ million)
991,613960,032

Equity attributable toowners of parent
to total assets

Equity attributable toowners of parent

Total equity(¥ million)
453,563396,228(¥ million)
452,014394,751

%
45.6
41.1

2. Dividends
Annual dividends
First quarter

Second quarter(¥)

Fiscal year ended–
March 31, 2017
Fiscal year ending–
March 31, 2018
Fiscal year ending
March 31, 2018
(Forecast)
Note: Revisions of the forecast most recently announced: No

Third quarter

Year-end

Total

(¥)

(¥)

(¥)

(¥)

0.00

–

28.00

28.00

0.00

–
28.00

28.00

3. Forecast of Consolidated Financial Results for the Fiscal Year Ending March 31, 2018
(From April 1, 2017 to March 31, 2018)(% indicate changes from the same period of the previous fiscal year)
Profit attributable to
Basic earnings
owners of parent
per share(¥ million)%(¥ million)%(¥ million)%(¥ million)%(¥)
784,000
5.9
86,00020.8
79,00026.4
63,00047.3
184.09The percentage changes from the same period of the previous fiscal year are calculated using the figures for the results of the fiscal
year ended March 31, 2017 that conform to the International Financial Reporting Standards (IFRS).
Revisions of the forecast most recently announced: Yes
Revenue

Full year
Notes: 1.
2.

Operating profit

Profit before tax* Notes(1) Changes in significant subsidiaries during the nine months under review (changes in specified
subsidiaries resulting in the changes in scope of consolidation): No(2) Changes in accounting policies and changes in accounting estimates
1)
2)
3)

Changes in accounting policies required by IFRS: No
Changes in accounting policies due to other reasons: No
Changes in accounting estimates: No(3) Total number of issued shares (common shares)
1) Total number of issued shares at the end of the period (including treasury shares)
As of December 31, 2017342,691,224 shares
As of March 31, 2017342,671,508 shares2) Total number of treasury shares at the end of the period
As of December 31, 2017
720,469 shares
As of March 31, 2017435,289 shares
3) Average number of shares during the period (cumulative from the beginning of the fiscal year)
Nine months ended December 31, 2017342,215,292 shares
Nine months ended December 31, 2016
342,236,086 shares* Quarterly financial results reports are not required to be subjected to quarterly reviews.
* Proper use of the forecast of financial results, and other special matters(Adoption of IFRS)The Olympus Group has adopted IFRS starting from the first quarter of the fiscal year ending March 31, 2018.
Figures for the same period of the previous fiscal year and the fiscal year ended March 31, 2017 are alsopresented in accordance with IFRS. For details about the differences between IFRS and Japanese GAAP withrespect to financial figures, please refer to the section of “First-time adoption” on page 14 of the attached material.
(Caution concerning forward-looking statements)
The forward-looking statements, including forecast of financial results, contained in these materials are based on
information currently available to the Company and on certain assumptions deemed to be reasonable.
Accordingly, the Company cannot make promises to achieve such forecasts. Actual business and other results
may differ substantially due to various factors. Please refer to the section of “Explanation of Forecast ofConsolidated Financial Results and Other Forward-looking Statements” on page 4 of the attached material for theconditions that form the assumptions for the forecast and cautions concerning the use thereof.

Attached Material
Contents
1.

Qualitative Information Regarding Settlement of Accounts for the Nine Months ....................................... 2(1) Explanation of Results of Operations ...................................................................................................... 2(2) Explanation of Financial Position ........................................................................................................... 3(3) Explanation of Cash Flows...................................................................................................................... 4(4) Explanation of Forecast of Consolidated Financial Results and Other Forward-looking Statements ..... 42.

Condensed Consolidated Financial Statements and Significant Notes Thereto ........................................... 5(1) Condensed Consolidated Statements of Financial Position..................................................................... 5(2) Condensed Consolidated Statements of Profit or Loss ........................................................................... 7(3) Condensed Consolidated Statements of Comprehensive Income ........................................................... 8(4) Condensed Consolidated Statements of Changes in Equity .................................................................... 9(5) Condensed Consolidated Statements of Cash Flows ............................................................................. 10(6) Notes to Condensed Consolidated Financial Statements ...................................................................... 12(Notes on premise of going concern) .................................................................................................... 12(Segment information) .......................................................................................................................... 12(First-time adoption).............................................................................................................................. 14

1

Olympus Corporation (7733) Financial Results for the Nine Months of the Fiscal Year Ending March 31, 2018

1. Qualitative Information Regarding Settlement of Accounts for the Nine Months(1)

Explanation of Results of Operations

From the fiscal year ending March 31, 2018, the Olympus Group has adopted IFRS. In addition, figures forthe nine months ended December 31, 2016, as well as those for the fiscal year ended March 31, 2017 havebeen restated according to IFRS for comparative analysis.
Overall(Millions of yen)
Increase (Decrease)
Ratio (%)
7.6

Nine months ended
December 31, 2016
531,773

Nine months ended
December 31, 2017572,064

Operating profit

55,96659,8083,842

6.9

Profit attributable to owners ofparent39,45848,037

8,579

21.7

Exchange rate (Yen/U.S. dollar)

106.63111.70

5.07–

Exchange rate (Yen/Euro)118.02128.53

10.51–

Revenue

Increase (Decrease)40,291In the global economy during the nine months ended December 31, 2017, the U.S. economy continued torecover steadily, and there was also a trend of moderate improvement in Europe and China. However,uncertainty over the future continued due to the political trends in the U.S. and Europe and the increasing
geopolitical risk in the East Asian and the Middle Eastern regions. In the Japanese economy, corporate
earnings and employment conditions improved, and a move toward recovery has been seen in private
consumption, with the trend of moderate recovery continuing.
Amid this business environment, the Olympus Group’s overall consolidated revenue increased for the ninemonths ended December 31, 2017 to ¥572,064 million (up 7.6% year on year), due to increased sales in the
Medical Business, Scientific Solutions Business, and Imaging Business, the Olympus Group’s three main
businesses. Operating profit increased to ¥59,808 million (up 6.9% year on year), as flat profits in the
Medical Business were offset by increased profits in the Scientific Solutions Business and Imaging Business.
Moreover, a reduction in finance costs such as interest expenses and a reduction in income taxes resulted in
profit attributable to owners of parent of ¥48,037 million (up 21.7% year on year).
Regarding foreign exchange, the yen depreciated against both the U.S. dollar and the euro compared to thesame period of the previous fiscal year. The average exchange rate during the period was ¥111.70 against the
U.S. dollar (¥106.63 in the same period of the previous fiscal year) and ¥128.53 against the euro (¥118.02 inthe same period of the previous fiscal year), which caused revenue and operating profit to rise by ¥26,199
million and ¥8,549 million, respectively, year on year.
Medical Business

Revenue
Operating profit

Nine months ended
December 31, 2016
410,31388,031

Nine months ended
December 31, 2017447,273
87,772

Increase (Decrease)
36,960(259)(Millions of yen)
Increase (Decrease)
Ratio (%)
9.0
(0.3)

Consolidated revenue in the Medical Business amounted to ¥447,273 million (up 9.0% year on year), while
operating profit amounted to ¥87,772 million (down 0.3% year on year).
In the gastrointestinal endoscope field, although the mainstay endoscopy platform systems are reaching thesecond half of their product cycles, steady sales were maintained. In the surgical field, sales of surgicalendoscopy systems equipped with 4K technologies, 3D laparoscopy systems and the “THUNDERBEAT”
integrated energy device with both advanced bipolar and ultrasonic energy continued to grow. In thetherapeutic devices field, sales of “VisiGlide 2” disposable guidewire for use in endoscopic diagnosis andtreatment of biliary and pancreatic ducts and others were strong.
Operating profit in the Medical Business remained largely unchanged year on year due to the effect of
product mix, etc.
2Olympus Corporation (7733) Financial Results for the Nine Months of the Fiscal Year Ending March 31, 2018

Scientific Solutions Business

Revenue
Operating profit

Nine months ended
December 31, 2016
63,524
1,868

Nine months ended
December 31, 2017
70,002
3,519

Increase (Decrease)
6,478
1,651

(Millions of yen)
Increase (Decrease)
Ratio (%)
10.2
88.4

Consolidated revenue in the Scientific Solutions Business amounted to ¥70,002 million (up 10.2% year onyear), while operating profit amounted to ¥3,519 million (up 88.4% year on year).
Sales of products for hospitals and life science research were steady in Japan. Moreover, in addition to strong
sales of industrial microscopes for semiconductor and electrical component inspection, sales of nondestructive testing equipment increased in North America and China, leading revenue in the Scientific
Solutions Business to rise year on year.
Operating profit in the Scientific Solutions Business rose year on year due to the increase in revenue andprogress made in pushing down expenses.
Imaging Business

Revenue
Operating profit

Nine months ended
December 31, 2016
46,785844

Nine months ended
December 31, 2017
47,313
1,493

Increase (Decrease)528649(Millions of yen)
Increase (Decrease)
Ratio (%)
1.1
76.9

Consolidated revenue in the Imaging Business amounted to ¥47,313 million (up 1.1% year on year), while
operating profit amounted to ¥1,493 million (up 76.9% year on year).
In the mirrorless camera field, sales increased as the Olympus Group maintained steady sales of the flagshipmirrorless camera “OM-D E-M1 Mark II,” introduced in the previous fiscal year, leading revenue in the
Imaging Business to rise year on year.
Operating profit in the Imaging Business rose year on year due to progress made in pushing down expenses.
Others

Revenue
Operating profit (loss)

Nine months ended
December 31, 2016
11,151
733

Nine months ended
December 31, 2017
7,476
(2,820)

Increase (Decrease)(3,675)(3,553)(Millions of yen)
Increase (Decrease)
Ratio (%)
(33.0)–

Consolidated revenue in other businesses amounted to ¥7,476 million (down 33.0% year on year) andoperating loss was ¥2,820 million (compared with an operating profit of ¥733 million in the same period of
the previous fiscal year).
As we pushed ahead with the reorganization of our non-core business domains, such as by transferring sharesin Nippon Outsourcing Corporation, a subsidiary of the Company, on October 31, 2016, revenue for otherbusinesses declined. Operating profit fell due to the recording of gain on sale of investments in subsidiaries inthe same period of the previous fiscal year and other factors.

(2)

Explanation of Financial Position

As of the end of the third quarter under review, total assets increased ¥31,581 million compared to the end of
the previous fiscal year to ¥991,613 million.
This was primarily as a result of increases in inventories of ¥21,796 million, property, plant and equipment of¥10,719 million and goodwill of ¥7,707 million, and decreases in cash and cash equivalents of ¥12,752
million and trade and other receivables of ¥7,393 million.
3

Olympus Corporation (7733) Financial Results for the Nine Months of the Fiscal Year Ending March 31, 2018

Total liabilities decreased ¥25,754 million compared to the end of the previous fiscal year to ¥538,050
million due mainly to increases in bonds and borrowings of ¥20,899 million in current liabilities and othernon-current liabilities of ¥2,564 million, and decreases in bonds and borrowings of ¥44,055 million in noncurrent liabilities, trade and other payables of ¥11,212 million and income taxes payable of ¥3,254 million.
Total equity increased ¥57,335 million compared to the end of the previous fiscal year to ¥453,563 million,
primarily due to an increase in retained earnings reflecting ¥48,037 million in profit attributable to owners ofparent, a decrease in retained earnings reflecting dividends of ¥9,583 million, and an increase in othercomponents of equity of ¥19,593 million arising from fluctuations in foreign exchange.
As a result of the foregoing, equity attributable to owners of parent to total assets increased from 41.1% as ofthe end of the previous fiscal year to 45.6%.
(3)

Explanation of Cash Flows

Cash and cash equivalents at the end of the third quarter under review reached ¥186,713 million, a decreaseof ¥12,752 million compared to the end of the previous fiscal year. The following are the cash flows for thenine months ended December 31, 2017.
Cash flows from operating activities“Cash flows from operating activities” increased by ¥60,219 million for the nine months ended December 31,
2017 (compared with an increase of ¥71,654 million for the nine months ended December 31, 2016).
Increasing factors mainly included ¥55,704 million in profit before tax and ¥39,580 million in depreciation
and amortization.
Cash flows from investing activities“Cash flows from investing activities” decreased by ¥42,166 million for the nine months ended December 31,
2017 (compared with a decrease of ¥46,005 million for the nine months ended December 31, 2016).
Decreasing factors mainly included ¥35,095 million in purchase of property, plant and equipment.
Cash flows from financing activities“Cash flows from financing activities” decreased by ¥36,160 million for the nine months ended December 31,
2017 (compared with a decrease of ¥24,370 million for the nine months ended December 31, 2016).
Decreasing factors mainly included ¥55,111 million in repayments of long-term borrowings.
(4)

Explanation of Forecast of Consolidated Financial Results and Other Forward-looking Statements

Regarding the forecasts of consolidated financial results for the fiscal year ending March 31, 2018, theforecasts have been revised from the forecasts announced in the “Consolidated Financial Results for the Six
Months of the Fiscal Year Ending March 31, 2018,” which was released on November 8, 2017.
Corporate taxes are expected to decrease following tax reform in the U.S., and profit attributable to owners ofparent is expected to exceed the previous forecast by ¥3,000 million. The average exchange rates for the third
quarter and onward of the fiscal year ending March 31, 2018, which are a precondition for the forecast, areexpected to be ¥110 against the U.S. dollar and ¥125 against the euro.
(Millions of yen)
Revenue
Previous Forecast (A)Revised Forecast (B)Increase (Decrease) (B-A)
Increase (Decrease) ratio (%)

784,000
784,000––

Operatingprofit86,00086,000––4

Profit before
tax
79,00079,000––

Profitattributable toowners ofparent60,00063,0003,000
5.0

Basic earnings
per share¥175.31¥184.09––

Olympus Corporation (7733) Financial Results for the Nine Months of the Fiscal Year Ending March 31, 2018

2. Condensed Consolidated Financial Statements and Significant Notes Thereto(1)

Condensed Consolidated Statements of Financial Position(Millions of yen)

IFRS transition date
(April 1, 2016)
ASSETS
Current assets
Cash and cash equivalents
Trade and other receivables
Other financial assets
Inventories
Income taxes receivable
Other current assets
Subtotal
Non-current assets held for sale
Total current assets
Non-current assets
Property, plant and equipment
Goodwill
Intangible assets
Retirement benefit asset
Investments accounted for using
equity method
Trade and other receivables
Other financial assets
Deferred tax assets
Other non-current assets
Total non-current assets
Total assets

As of March 31, 2017

As of December 31,
2017

166,379
159,1252,498
112,265
14,282
14,497
469,046–
469,046

199,465
157,469
1,618
125,319
5,146
12,902501,919
3,828
505,747

186,713150,076
9,191
147,115
10,44314,016
517,554–
517,554

158,816
97,19083,941
24,510159,735
95,56875,85824,544

170,454103,275
76,98324,818

1,926

51

36

18,706
77,27343,8661,700
507,928
976,974

18,30337,89541,437894
454,285
960,032

17,31339,79640,0941,290
474,059
991,613

5

Olympus Corporation (7733) Financial Results for the Nine Months of the Fiscal Year Ending March 31, 2018

(Millions of yen)

IFRS transition date
(April 1, 2016)
LIABILITIES AND EQUITY
Liabilities
Current liabilities
Trade and other payables
Bonds and borrowings
Other financial liabilities
Income taxes payable
Provisions
Other current liabilities
Total current liabilities
Non-current liabilities
Bonds and borrowings
Other financial liabilities
Retirement benefit liability
Provisions
Deferred tax liabilities
Other non-current liabilities
Total non-current liabilities
Total liabilities
EquityShare capital
Capital surplus
Treasury shares
Other components of equity
Retained earnings
Total equity attributable to ownersof parent
Non-controlling interests
Total equity
Total liabilities and equity

As of March 31, 2017

As of December 31,
2017

75,40456,57011,8349,121
4,070
121,106
278,105

70,834
68,777
11,018
11,710
5,675
118,436
286,450

59,622
89,676
11,505
8,456
7,177
120,929
297,365

263,731
7,574
38,751365
10,604
11,262332,287
610,392

217,193
6,926
37,872
425
9,565
5,373
277,354563,804

173,138
8,868
39,239756
10,747
7,937
240,685
538,050

124,520
91,368(1,122)
21,378
128,988

124,520
91,779(1,122)(5,652)
185,226

124,560
91,792(2,335)
13,941
224,056

365,132

394,751

452,0141,450
366,582
976,974

1,477
396,228960,032

1,549
453,563991,613

6

Olympus Corporation (7733) Financial Results for the Nine Months of the Fiscal Year Ending March 31, 2018(2)

Condensed Consolidated Statements of Profit or Loss
(Millions of yen)

Nine months ended
December 31, 2016
531,773
185,206
346,567
283,524

Nine months ended
December 31, 2017572,064
199,153
372,911
310,238(1,192)

(127)

5,199
11,08455,966
1,731
8,772
48,925
9,405
39,5203,409
6,147
59,8081,344
5,448
55,704
7,519
48,185

Profit attributable to:
Owners of parent
Non-controlling interests
Profit39,45862
39,52048,037
148
48,185

Earnings per share
Basic earnings per share
Diluted earnings per share¥115.30¥115.25¥140.37¥140.31

Revenue
Cost of sales
Gross profit
Selling, general and administrative expenses
Share of profit (loss) of investments accounted for using
equity method
Other income
Other expenses
Operating profit
Finance income
Finance costs
Profit before tax
Income taxes
Profit7

Olympus Corporation (7733) Financial Results for the Nine Months of the Fiscal Year Ending March 31, 2018(3)

Condensed Consolidated Statements of Comprehensive Income(Millions of yen)

Nine months ended
December 31, 2016
39,520Nine months ended
December 31, 2017
48,185

3,580

4,856

(1,649)
1,931

(614)
4,242

(2,271)576

15,015
727

0

(12)

Total of items that may be reclassified to profit or loss
Total other comprehensive income
Comprehensive income(1,695)236
39,756

15,73019,972
68,157

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

39,70353
39,75668,006151
68,157

ProfitOther comprehensive income
Items that will not be reclassified to profit or loss
Financial assets measured at fair value through othercomprehensive income
Remeasurements of defined benefit plans
Total of items that will not be reclassified to profit or loss
Items that may be reclassified to profit or loss
Exchange differences on translation of foreign operations
Cash flow hedges
Share of other comprehensive income of associates
accounted for using equity method

8Olympus Corporation (7733) Financial Results for the Nine Months of the Fiscal Year Ending March 31, 2018(4)

Condensed Consolidated Statements of Changes in Equity
Nine months ended December 31, 2016
(Millions of yen)
Equity attributable to owners of parent

Balance at April 1, 2016

Total equity

128,988

365,1321,450

366,582

39,45839,45862

39,520

245

(9)

236

39,70353

39,756

Share capital

TreasurysharesOther
componentsof equity

Retainedearnings

124,520

91,368(1,122)

21,378

ProfitOther comprehensive
incomeComprehensive income

Total

Noncontrollinginterests

Capitalsurplus

245
–

–

–

Purchase of treasury shares
Disposal of treasury shares

(8)

245

39,458

(5)

(5)

8

0

Dividends from surplus
Transfer from othercomponents of equity toretained earnings

1,394

(5)
0

(5,818)(5,818)(59)(5,877)(1,394)––
141

Share-based paymenttransactions

141

141

Equity transactions with
non-controlling interests

294

294

(362)

(68)

Total transactions withownersBalance at December 31,
2016

–

427

3

1,394

(7,212)(5,388)(421)(5,809)124,520

91,795(1,119)23,017161,234

399,447

1,082

400,529

Nine months ended December 31, 2017
(Millions of yen)
Equity attributable to owners of parent

Balance at April 1, 2017

Total equity

185,226

394,751

1,477

396,228

48,03748,037

148

48,185

19,9693

19,97268,006151

68,157

Share capital

TreasurysharesOther
componentsof equity

Retainedearnings

124,520

91,779(1,122)(5,652)

ProfitOther comprehensive
incomeComprehensive income

Total

Noncontrollinginterests

Capitalsurplus19,969––Purchase of treasury shares
Disposal of treasury shares(7)–

19,96948,037(1,220)(1,220)7

0Dividends from surplus
Transfer from othercomponents of equity toretained earnings(376)(1,220)0(9,583)(9,583)(79)(9,662)

376

–

–

60

60

Share-based paymenttransactions

40

20

Total transactions withowners40

13(1,213)(376)(9,207)(10,743)(79)(10,822)

124,560

91,792(2,335)

13,941

224,056

452,014

1,549

453,563

Balance at December 31,
2017

9Olympus Corporation (7733) Financial Results for the Nine Months of the Fiscal Year Ending March 31, 2018(5)

Condensed Consolidated Statements of Cash Flows(Millions of yen)

Cash flows from operating activities
Profit before tax
Depreciation and amortization
Interest and dividend income
Interest expenses
Loss (gain) on sale of investments in subsidiaries
Loss related to securities litigation
Share of loss (profit) of investments accounted for using
equity method
Decrease (increase) in trade and other receivables
Decrease (increase) in inventories
Increase (decrease) in trade and other payables
Increase (decrease) in retirement benefit liability
Decrease (increase) in retirement benefit asset
Other
SubtotalInterest received
Dividends received
Interest paid
Legal settlement compensation received
Loss on litigation paid
Loss related to the US Anti-kickback Statute paid
Income taxes paid
Net cash provided by operating activities
Cash flows from investing activities
Purchase of property, plant and equipment
Proceeds from sale of property, plant and equipment
Purchase of intangible assets
Payments for loans receivableCollection of loans receivable
Proceeds from sale of investments
Purchase of investments in subsidiaries resulting inchange in scope of consolidation
Proceeds from sale of investments in subsidiaries
resulting in change in scope of consolidation
Other
Net cash used in investing activities

10

Nine months ended
December 31, 2016

Nine months ended
December 31, 2017

48,92539,737(1,579)6,256(3,892)
6,703

55,704
39,580(1,232)
5,136
(638)
592

1,192

127

11,911(17,830)(1,977)563
2,011(2,616)
89,404432
1,147(5,077)106(3,277)(4,638)(6,443)71,65416,305(18,017)(11,095)
788
1,312(9,759)78,803629
603(4,494)(36,817)93(7,560)(7,258)18
2,098(35,095)
4,326(10,539)
(960)
838
6,716

–

(8,703)

3,443

2,378

(22)
(46,005)(1,127)(42,166)

–

(809)
–

(14,513)60,219Olympus Corporation (7733) Financial Results for the Nine Months of the Fiscal Year Ending March 31, 2018

(Millions of yen)

Cash flows from financing activities
Increase (decrease) in short-term borrowings
Proceeds from long-term borrowings
Repayments of long-term borrowings
Dividends paid
Dividends paid to non-controlling interests
Proceeds from issuance of bonds
Redemption of bonds
Purchase of investments in subsidiaries not resulting inchange in scope of consolidation
Payments for purchase of treasury shares
Other
Net cash used in financing 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 period
Cash and cash equivalents at end of period

11

Nine months ended
December 31, 2016

Nine months ended
December 31, 2017

(5,951)
20,000(20,107)(5,818)(59)–(10,000)(2,470)23,550(55,111)(9,583)
(79)
9,946
–

(69)

–

(5)
(2,361)(24,370)(1,220)(1,193)(36,160)

(860)

5,355

419
166,379
166,798(12,752)
199,465
186,713Olympus Corporation (7733) Financial Results for the Nine Months of the Fiscal Year Ending March 31, 2018

(6)

Notes to Condensed Consolidated Financial Statements(Notes on premise of going concern)
No items to report(Segment information)(1) Overview of reportable segments
The reportable segments of the Olympus Group are components of the Company whose separate
financial information is available. These segments are periodically evaluated by the Board of Directors
in deciding how to allocate management resources and in assessing the performance.
The Olympus Group, based on the four businesses, Medical Business, Scientific Solutions Business,
Imaging Business and Others, formulates comprehensive strategies for Japan and abroad with respect
to products and services handled and deploys business activities.
Accordingly, the Olympus Group has the abovementioned four businesses as reportable segments.
The principal products and services of each reportable segment are as follows.
Reportable Segment

Principal products and services

Medical Business
Scientific Solutions Business

Gastrointestinal endoscopes, surgical endoscopes, endo-therapy devices, ultrasound endoscopes
Biological microscopes, industrial microscopes, industrial endoscopes, non-destructive testing
equipment
Digital cameras, voice recorders
Biomedical materials, system development

Imaging Business
Others(2) Revenue and business results for reportable segments
Revenue and other performance of each reportable segment of the Olympus Group are as follows. The
accounting method used for reportable segments is the same as that applied in the first quarter and thethree months ended June 30, 2017.
Nine months ended December 31, 2016
(Millions of yen)
Reportable Segment
Adjustment(Note 2)

Amount oncondensed
consolidated
financialstatements

531,773–

531,773

584

624

(624)

–

46,788

11,735532,397(624)

531,773844

733

91,476(35,510)55,966

MedicalScientific
Solutions

Imaging

410,31363,52446,785

11,151–37

3

Total revenue

410,31363,561

Operating profit (loss)

88,031

1,868

OthersTotal

Revenue
Revenue from outside
customers
Revenue among
segments (Note 1)

Finance income
Finance costs

1,731
8,772

Profit before tax

48,925

Other items
Share of profit (loss) ofinvestments accounted forusing equity method
Depreciation andamortization
Impairment losses (nonfinancial assets)

(968)

1

–

(225)

(1,192)–(1,192)30,226

4,982

1,328

389

36,9252,812

39,737

230

–

–

–

230

–

230

Notes:
1. Revenue among segments is based on actual market prices.
2. Adjustment for operating profit (loss) is corporate expenses that consist of elimination of transactions among
segments as well as general and administrative expenses and fundamental research expenses etc. that are not
attributable to reportable segments.

12

Olympus Corporation (7733) Financial Results for the Nine Months of the Fiscal Year Ending March 31, 2018

Nine months ended December 31, 2017
(Millions of yen)
Reportable Segment
Adjustment(Note 2)

Amount oncondensed
consolidated
financialstatements

572,064–

572,064

430

495

(495)

–

47,321

7,906

572,559(495)

572,064

1,493(2,820)89,964(30,156)

59,808

MedicalScientific
Solutions

Imaging447,273

70,00247,313

7,476

–

57

8

Total revenue

447,273

70,059Operating profit (loss)

87,772

3,519

OthersTotal

Revenue
Revenue from outside
customers
Revenue among
segments (Note 1)

Finance income
Finance costs

1,344
5,448

Profit before tax

55,704

Other items
Share of profit (loss) ofinvestments accounted forusing equity method
Depreciation andamortization
Impairment losses (nonfinancial assets)

(124)

(3)

–

–

(127)

–

(127)

30,577

4,423

1,602

465

37,0672,513

39,580

5

55

–

–

60

–

60

Notes:
1. Revenue among segments is based on actual market prices.
2. Adjustment for operating profit (loss) is corporate expenses that consist of elimination of transactions among
segments as well as general and administrative expenses and fundamental research expenses etc. that are not
attributable to reportable segments.

13

Olympus Corporation (7733) Financial Results for the Nine Months of the Fiscal Year Ending March 31, 2018

(First-time adoption)
The Olympus Group disclosed the condensed consolidated financial statements under IFRS for the first timefrom the first quarter of this fiscal year. The latest consolidated financial statements under Japanese GAAP
are prepared for the fiscal year ended March 31, 2017, and the IFRS transition date is April 1, 2016.
IFRS 1 stipulates that an entity adopting IFRS for the first time shall, in principle, apply the standards
required under IFRS retrospectively to prior periods. However, IFRS 1 allows certain exemptions from theretrospective application and provides exceptions that prohibit retrospective application on a mandatory basiswith respect to certain aspects required by IFRS. The Olympus Group has applied the following exemptions.
(1) Exemption under IFRS 1
1) Business combinations
IFRS 1 permits an entity not to apply IFRS 3 “Business Combinations” retrospectively to businesscombinations that occurred prior to the date of transition to IFRS. The Olympus Group elected toapply this exemption and, consequently, the amount of goodwill arising from business combinations
before the date of transition is based on the book value as of the date of transition under Japanese
GAAP. Further, the Olympus Group performed an impairment test on goodwill at the date oftransition regardless of whether there was any indication that the goodwill may be impaired.
2) Transition differences of foreign operations
Under IFRS 1, an option is allowed whereby cumulative translation differences of foreign
operations as of the date of transition to IFRS may be assumed to be nil. The Olympus Group has
adopted the exemption.
3) Borrowing costs
IFRS 1 allows entities to commence capitalization of borrowing costs relating to qualifying assets atthe date of transition to IFRS. The Olympus Group adopts this exemption.
4) Designation of financial instruments recognized prior to date of transition
IFRS 1 allows entities to determine the classification under IFRS 9 based on facts andcircumstances as of the date of transition, rather than facts and circumstances that exist at the timeof initial recognition. In addition, IFRS 1 allows entities to designate equity financial assets asfinancial assets measured at fair value through other comprehensive income. The Olympus Group
has applied this exemption and designated certain equity financial assets as financial assets
measured at fair value through other comprehensive income.
(2) Mandatory exception under IFRS 1IFRS 1 prohibits retrospective application of IFRS with respect to “estimates,” “derecognition offinancial assets and financial liabilities,” “hedge accounting,” “non-controlling interest,” and“classification and measurement of financial assets.” Thus the Olympus Group applies IFRS to these
items from the IFRS transition date and onwards.

14

Olympus Corporation (7733) Financial Results for the Nine Months of the Fiscal Year Ending March 31, 2018

(3) Reconciliations
The reconciliations required to be disclosed at the first-time adoption of IFRS is as follows. In thereconciliations below, in principle, “Reclassification” includes items that do not affect retained
earnings and comprehensive income, while “Differences in recognition and measurement” includes
items that affect retained earnings and comprehensive income.
Reconciliation of equity
IFRS transition date (April 1, 2016)(Millions of yen)
Presentation underJapanese GAAP

Japanese GAAP

Reclassification

Differences inrecognition andmeasurement

IFRS

Note

AssetsCurrent assets
Cash and time deposits
Notes and accounts
receivable
Lease receivables andlease investment assets
Merchandise andfinished goods
Work in process
Raw materials andsupplies
Deferred income taxes
Other current assets
Allowance for doubtful
accounts

Total current assets
Fixed assets
Property, plant andequipment
Goodwill
Intangible assets(Others)
Investments and otherassetsInvestment securities
Net defined benefit
asset
Other assets
Allowance for doubtful
accounts

Deferred income taxes
Total fixed assets
Total assets

Presentation under IFRS
AssetsCurrent assets
Cash and cash
equivalents
Trade and otherreceivables

166,554(230)

55

166,379

140,666

32,154(13,695)

159,125

33,565(33,565)

–

1,410

1,088

2,498

54,24557,313

707

112,265

Inventories

21,993(21,993)–

35,320(35,320)–

38,461
36,478(38,461)(36,478)––(6,590)6,590–

15,612
14,580(1,330)(83)

14,282
14,497

Income taxes receivable
Other current assets(38,388)(13,258)

469,046

Total current assets

A, B

Non-current assets
Property, plant andequipment
GoodwillD

Intangible assets

520,692

A

Other financial assets

166,064(792)(6,456)

158,816

97,190––97,19053,607

1,191

29,14383,941

71,141(71,141)–

24,749–(239)

64,804(64,804)–(9,054)

9,054

–

1,926

–

1,926

45,710(27,004)

18,706

A

11,421

76,961
38,461
1,822

312(6,016)(122)

77,27343,8661,700

E479,922

38,388(10,382)

507,928

Total non-current assets

1,000,614–(23,640)

976,974

Total assets

15

24,510Retirement benefit asset

Investments accounted
for using equity method
Trade and otherreceivables
Other financial assets
Deferred tax assets
Other non-current assets

Olympus Corporation (7733) Financial Results for the Nine Months of the Fiscal Year Ending March 31, 2018
(Millions of yen)
Presentation underJapanese GAAP
Liabilities
Current liabilities
Notes and accounts
payableShort-term borrowings
Current maturities ofbonds
Other payable

Japanese GAAP

Reclassification

Differences inrecognition andmeasurement

IFRS

Note

Presentation under IFRS
Liabilities
Current liabilities

40,597

34,910(103)

75,404

Trade and other payables

26,65630,000(86)

56,570Bonds and borrowings

30,000(30,000)–

36,762

–
6,605
–
1

11,834

Other financial liabilities

9,121

Income taxes payable

Accrued expenses
Income taxes payable
Provision for productwarranties
Provision for points
Provision for loss on
business liquidation
Provision for loss on
litigation
Other current liabilities

90,4389,120(36,762)5,229(90,438)
–

6,314

728

(2,972)

207

(207)

–

298

(298)

–

567

(567)

–

25,666(25,666)
111,474

Total current liabilities
Non-current liabilities
Long-term bonds, lesscurrent maturities
Long-term borrowings,
less current maturities

266,625

4,070

FProvisions

–
9,632

121,106

F, G

Other current liabilities(1,597)

13,077278,105

Total current liabilities
Non-current liabilities

25,000239,482(751)

263,731

Bonds and borrowings

239,482(239,482)

–

7,381

193

7,574

38,645–106

38,751Other financial liabilities
Retirement benefit
liability

38

(38)

–

18,155(18,155)–

28,386

365
1,338

–
(19,120)365
10,604E

10,706556

11,262

G

349,706

1,597(19,016)

332,287

Total liabilities
Net Assets
Shareholders’ equity
Common stock
Capital surplus
Treasury stock, at cost
Accumulated othercomprehensive income
Subscription rights toshares616,331–(5,939)610,392

Total liabilities
Equity124,520
90,940(1,122)

–
428
–

–
–
–

124,520
91,368(1,122)(4,968)–26,346

21,378H, I

Share capital
Capital surplus
Treasury shares
Other components ofequity

428

(428)

–

Retained earnings

172,989–(44,001)

128,988

A, B, D,E, F, G,
H, I

382,787–(17,655)

365,132

Net defined benefit
liability
Provision for retirement
benefits for directors
and audit & supervisoryboard members
Other non-current
liabilities
Deferred income taxes

Total non-current
liabilities

Non-controlling interests
Total net assets
Total liabilities and net
assetsProvisions
Deferred tax liabilities
Other non-current
liabilities
Total non-current
liabilities

Retained earnings
Total equity attributableto owners of parent
Non-controlling interests

1,496

–

(46)

1,450

384,283–(17,701)

366,582

Total equity

1,000,614–(23,640)

976,974

Total liabilities and equity

16

Olympus Corporation (7733) Financial Results for the Nine Months of the Fiscal Year Ending March 31, 2018

As of December 31, 2016
(Millions of yen)
Presentation underJapanese GAAP

Japanese GAAP

Reclassification

Differences inrecognition andmeasurement

IFRS

Note

AssetsCurrent assets

Presentation under IFRS
AssetsCurrent assets
Cash and cash
equivalents
Trade and otherreceivables
Other financial assets

Cash and time deposits

166,961(192)

29

166,798

Notes and accounts
receivable

122,21033,914(9,814)

146,310

1,148

222

1,370

57,886

71,627

1,032

130,545

Inventories

23,902(23,902)47,726(47,726)––

110,090(110,090)(6,298)

6,298

Merchandise andfinished goods
Work in process
Raw materials andsupplies
Other current assets
Allowance for doubtful
accounts

Subtotal

Total current assets
Fixed assets
Property, plant andequipment
Goodwill
Intangible assets(Others)
Investments and otherassetsInvestment securities
Net defined benefit
asset
Other assets
Allowance for doubtful
accounts

A––

18,481
11,172(9,748)(86)

8,733
11,086

Income taxes receivable
Other current assets

522,477(39,270)(18,365)464,842

–

130

–

130

Subtotal
Non-current assets held
for sale

522,477(39,140)(18,365)464,972

Total current assets

172,929(834)(6,924)

165,171

A, B

92,276–

7,001

99,277C

Non-current assets
Property, plant andequipment
Goodwill

48,395

1,842

30,70980,946

D

Intangible assets

72,463(72,463)–

23,013(3,004)

98,948(98,948)–(9,509)

9,509

–

242

–

242

45,769(26,733)

19,036

A

81,19449,559257

295(7,336)(126)

81,48942,223
131

E

Deferred income taxes

20,009Retirement benefit asset

Investments accounted
for using equity method
Trade and otherreceivables
Other financial assets
Deferred tax assets
Other non-current assets

Total fixed assets

475,50239,140(6,118)508,524

Total non-current assets

Total assets

997,979–(24,483)

973,496

Total assets

17

Olympus Corporation (7733) Financial Results for the Nine Months of the Fiscal Year Ending March 31, 2018
(Millions of yen)
Presentation underJapanese GAAP
Liabilities
Current liabilities
Notes and accounts
payableShort-term borrowings
Current maturities of
bonds
Income taxes payable
Provision for productwarranties
Provision for points
Provision for loss on
business liquidation
Other current liabilities
Total current liabilities
Non-current liabilities
Long-term bonds, lesscurrent maturities
Long-term borrowings,
less current maturities
Net defined benefit
liability
Other reserves
Other non-current
liabilities

Japanese GAAP

Reclassification

Differences inrecognition andmeasurement

IFRS

Note

Liabilities
Current liabilities
40,14932,901

198

73,248Trade and other payables

55,53720,000(10)75,527

Bonds and borrowings

20,000(20,000)

–

5,676

8,036
–

7,980
31

16,016
5,707

Other financial liabilities
Income taxes payable

6,406

102

(3,031)

3,477

FProvisions

160

(160)

217

(217)

–
–

137,444(137,444)
95,219–8,939

104,158

F, G

Other current liabilities

265,589(1,563)

14,107278,133

Total current liabilities
Non-current liabilities

25,000206,430(477)

230,953

Bonds and borrowings

206,430(206,430)

–

7,202

2,121

9,323

38,514–

1,186

39,700

Other financial liabilities
Retirement benefit
liability

19

(19)

40,795(40,795)––

366
30,050–(20,804)

366
9,246

E

4,759

487

5,246

G

310,758

1,563(17,487)

294,834

Total liabilities
Net assets
Common stock
Capital surplus
Treasury stock, at cost
Accumulated othercomprehensive income
Subscription rights toshares576,347–(3,380)572,967

124,520
91,236(1,119)

–
559
–

–
–
–

124,520
91,795(1,119)(3,005)–26,02223,017

H, I

559

(559)

–

Retained earnings

208,316–(47,082)

161,234

A, B, C,
D, E, F,
G, H, I420,507–(21,060)

399,447

Total non-current
liabilities

Presentation under IFRSProvisions
Deferred tax liabilities
Other non-current
liabilities
Total non-current
liabilities
Total liabilities
EquityShare capital
Capital surplus
Treasury shares
Other components ofequityRetained earnings
Total equity attributableto owners of parent
Non-controlling interests

1,125

–

(43)

1,082

Total net assets

421,632–(21,103)400,529

Total equity

Total liabilities and net
assets997,979–(24,483)

973,496

Total liabilities and equity

Non-controlling interests

18

Olympus Corporation (7733) Financial Results for the Nine Months of the Fiscal Year Ending March 31, 2018

As of March 31, 2017
(Millions of yen)
Presentation underJapanese GAAP

Japanese GAAP

Reclassification

Differences inrecognition andmeasurement

IFRS

Note

AssetsCurrent assets
Cash and time deposits
Notes and accounts
receivable
Lease receivables andlease investment assets
Merchandise andfinished goods
Work in process
Raw materials andsupplies
Deferred income taxes
Other current assets
Allowance for doubtful
accounts

Sub-total

Total current assets
Fixed assets
Property, plant andequipment
Goodwill
Intangible assets (Others)
Investments and otherassetsInvestment securities
Net defined benefit asset
Other assets
Allowance for doubtful
accounts

Presentation under IFRS
AssetsCurrent assets
Cash and cash
equivalents
Trade and otherreceivables

199,431–34

199,465

137,924

34,889(15,344)

157,469

35,338(35,338)

–

1,158

460

1,618

51,25772,8071,255

125,319

Inventories

21,830(21,830)–

50,977(50,977)–

36,72925,226(36,729)(25,226)––(5,720)

5,720

–

5,831
12,965

(685)
(63)

5,146
12,902

Income taxes receivable
Other current assets

552,992(36,730)(14,343)

501,919

–

3,828

–

3,828

Subtotal
Non-current assets held
for sale

552,992(32,902)(14,343)505,747

171,352(4,427)(7,190)159,735

A, B

86,66444,426

–
1,693

8,904
29,73995,56875,858CD

28,946
24,762
66,994(28,946)–(66,994)

–
(218)
–

24,544(10,016)

10,016

–

51

–

51

46,150(27,847)

18,303A

E

A

Other financial assets

Total current assets
Non-current assets
Property, plant andequipment
Goodwill
Intangible assets

Retirement benefit asset

Investments accounted
for using equity method
Trade and otherreceivables
Other financial assets
Deferred tax assets
Other non-current assets

Deferred income taxes

24,94237,59936,7291,031

296(20,234)(137)

37,89541,437894

Total fixed assets

438,070

32,902(16,687)454,285

Total non-current assets

Total assets

991,062–(31,030)

960,032

Total assets

19

Olympus Corporation (7733) Financial Results for the Nine Months of the Fiscal Year Ending March 31, 2018
(Millions of yen)
Presentation underJapanese GAAP
Liabilities
Current liabilities
Notes and accounts
payableShort-term borrowings
Other payable

Japanese GAAP

Reclassification

Differences inrecognition andmeasurement

IFRS

Note

Presentation under IFRS
Liabilities
Current liabilities

41,59629,17860

70,834

Trade and other payables

68,852
32,595

(75)
–
5,500
–
53

68,777

Bonds and borrowings

11,018Other financial liabilities

11,710

Income taxes payable

5,675

F

Provisions

F, G

Other current liabilities

Accrued expenses
Income taxes payable
Provision for productwarranties
Provision for points
Provision for loss on
business liquidation
Provision for loss on
litigation
Other current liabilities

80,944
11,657–(32,595)
5,518(80,944)
–

8,474

232

(3,031)

223

(223)

–

190

(190)

–

217

(217)

–

29,981(29,981)108,228–
10,208118,436

Total current liabilities
Non-current liabilities
Long-term bonds, lesscurrent maturities
Long-term borrowings,
less current maturities

274,729(994)

12,715

286,450

Total current liabilities
Non-current liabilities

25,000

192,505(312)

217,193

Bonds and borrowings

192,505(192,505)

–

7,017

(91)

6,926

37,737–135

37,872Other financial liabilities
Retirement benefit
liability

21

(21)

–

11,295(11,295)–

18,895425
696–(10,026)

425
9,565

E

4,172

1,201

5,373

G

285,453994(9,093)

277,354

Total liabilities
Net assets
Common stock
Capital surplus
Treasury stock, at cost
Accumulated othercomprehensive income
Subscription rights toshares560,182–

3,622

563,804

124,520
91,225(1,122)

–
554
–

–
–
–

124,520
91,779(1,122)(31,178)–

25,526(5,652)

H, I

554

(554)

–

Retained earnings

245,362–(60,136)

185,226

A, B, C,
D, E, F,
G, H, I429,361–(34,610)394,751

Net defined benefit
liability
Provision for retirement
benefits for directors
and audit & supervisoryboard members
Other non-current
liabilities
Deferred income taxes

Total non-current
liabilities

Provisions
Deferred tax liabilities
Other non-current
liabilities
Total non-current
liabilities
Total liabilities
EquityShare capital
Capital surplus
Treasury shares
Other components ofequityRetained earnings
Total equity attributableto owners of parent
Non-controlling interests

1,519

–

(42)

1,477

Total net assets

430,880–(34,652)

396,228

Total equity

Total liabilities and net
assets991,062–(31,030)

960,032

Total liabilities and equity

Non-controlling interests

20

Olympus Corporation (7733) Financial Results for the Nine Months of the Fiscal Year Ending March 31, 2018

Notes on reconciliations of equity
1) Differences in recognition and measurement
A Leases
With regard to lease transactions as lessor, some of transactions classified as finance leases underJapanese GAAP are classified as operating leases under IFRS. Consequently, the relevant leasereceivables have been reversed, and property, plant and equipment have been recognized.
In light of the above, retained earnings as of April 1, 2016 (IFRS transition date), December 31,
2016, and March 31, 2017 decreased by ¥11,934 million, ¥12,624 million, and ¥14,775 million,
respectively.
B Depreciation of property, plant and equipment
With regard to depreciation of property, plant and equipment, the Olympus Group has reviewed
estimates of useful lives and residual values in adopting IFRS. Consequently, the carrying
amount of property, plant and equipment has decreased.
In light of the above, retained earnings as of April 1, 2016 (IFRS transition date), December 31,
2016, and March 31, 2017 decreased by ¥6,947 million, ¥8,035 million, and ¥8,361 million,
respectively.
C Goodwill
Under Japanese GAAP, goodwill was amortized on a straight-line method over the reasonable
number of years, not exceeding 20 years. However, under IFRS, amortization of goodwill on andafter the date of transition was discontinued, and impairment test is performed in each period.
In light of the above, retained earnings as of December 31, 2016 and March 31, 2017 increasedby ¥6,409 million and ¥8,639 million, respectively.
D Capitalization of development expenses
Expenditures for research and development were expensed under Japanese GAAP. However,under IFRS, since certain expenditures are eligible for capitalization, those expenses arerecognized as intangible assets.
In light of the above, retained earnings as of April 1, 2016 (IFRS transition date), December 31,
2016, and March 31, 2017 increased by ¥18,598 million, ¥20,376 million, and ¥19,860 million,
respectively.

E Deferred taxes
With respect to the tax effects arising from the elimination of intercompany unrealized gains, thedeferral method was applied under Japanese GAAP, but the asset and liability approach has been
employed under IFRS.
In addition, the Olympus Group has assessed the recoverability of deferred tax assets under IFRS.
In light of the above, retained earnings as of April 1, 2016 (IFRS transition date) increased by¥3,143 million, and retained earnings as of December 31, 2016 and March 31, 2017 decreased by¥6,002 million, and ¥19,856 million, respectively.
Because temporary differences arose in line with the reconciliation from Japanese GAAP to IFRS,
the amounts of deferred tax assets and deferred tax liabilities have been adjusted. The effect of
the adjustments on retained earnings is stated in each other item.
F

Warranty
With respect to warranty, expenses expected to be incurred in the future were recognized asprovisions under Japanese GAAP. However, under IFRS, warranty has been separated into
quality assurance warranty and service warranty, the amount corresponding to quality assurance
warranty has been recognized as provisions, and for the portion of service warranty whereservices have not been provided, revenue has been deferred and recognized other current
liabilities.

21

Olympus Corporation (7733) Financial Results for the Nine Months of the Fiscal Year Ending March 31, 2018

In light of the above, retained earnings as of April 1, 2016 (IFRS transition date), December 31,
2016, and March 31, 2017 decreased by ¥1,364 million, ¥1,246 million, and ¥1,358 million,
respectively.
G Accrued paid absences
Accrued paid absences were not recognized as liabilities under Japanese GAAP, but have beenrecognized as liabilities under IFRS.
In light of the above, retained earnings as of April 1, 2016 (IFRS transition date), December 31,
2016, and March 31, 2017 decreased by ¥4,260 million, ¥4,261 million, and ¥4,476 million,
respectively.
H Post-employment benefits
Under Japanese GAAP, actuarial gains or losses and past service costs were recorded in net
assets through other comprehensive income when they are incurred and were expensed on astraight-line method over a certain number of years not exceeding the average remaining service
period of employees. Under IFRS, actuarial gains or losses have been recognized in othercomponents of equity through other comprehensive income as incurred, and then immediatelytransferred to retained earnings. Past service costs have been fully recognized in profit or loss as
incurred.
In light of the above, retained earnings as of April 1, 2016 (IFRS transition date), December 31,
2016, and March 31, 2017 decreased by ¥21,234 million, ¥24,317 million, and ¥20,132 million,
respectively.
I

Resetting of foreign currency translation adjustments
The Olympus Group has chosen to apply the exemption set forth under IFRS 1, and transferred
all cumulative exchange differences on translation of foreign operations as of the date oftransition to IFRS to retained earnings.
In light of the above, retained earnings as of April 1, 2016 (IFRS transition date), December 31,
2016, and March 31, 2017 decreased by ¥8,686 million, respectively.

2) Reclassification
J

Reclassification on condensed consolidated statement of financial position
Certain reclassifications have been made to conform to provisions under IFRS. The major
reclassifications are as follows:(a) Deferred tax assets and deferred tax liabilities are classified to non-current assets and noncurrent liabilities.
(b) Financial assets and financial liabilities are disclosed separately.
(c) Investments accounted for using equity method is disclosed separately.
(d) Non-current assets or disposal groups held for sale are disclosed separately.

22

Olympus Corporation (7733) Financial Results for the Nine Months of the Fiscal Year Ending March 31, 2018

Reconciliation of profit or loss and comprehensive income
Nine months ended December 31, 2016
(Millions of yen)Japanese GAAP

Reclassification

Differences inrecognition andmeasurement

Net sales
Costs of sales

533,506
179,729(2,185)
1,806

452
3,671

531,773
185,206

A
Revenue
A, B, D, F Cost of sales

Gross profit
Selling, general andadministrative expenses

353,777(3,991)(3,219)346,567

299,037(3,991)(11,522)283,524(1,192)–(1,192)

5,458
11,572

(259)
(488)

5,199
11,084Gross profit
Selling, general and
B, C, D, F
administrative expenses
Share of profit (loss) ofinvestments accounted forusing equity method
Other income
Other expenses(7,306)(3,087)(13,368)(4,190)(7,693)
1,818
8,296

8,532
–
–
–
–
(87)
476

55,966
–
–
–
–
1,731
8,772

Operating profit

40,956–

7,969

48,925

Profit before tax

(248)

–

9,653

9,405

41,204–(1,684)39,520Presentation underJapanese GAAP

Operating income
Non-operating income
Non-operating expenses
Extraordinary income
Extraordinary losses

Income before provision
for income taxes
Income taxes
Net income

54,7403,087
13,368
4,190
7,693

IFRS

Note

Presentation under IFRSFinance income
Finance costs

E

Income taxes
ProfitProfit attributable to:

Net income attributable toowners of the parent
Net income attributable tonon-controlling interests

41,145–(1,687)39,458

59

–

3

62

23

Owners of parent
Non-controlling interests

Olympus Corporation (7733) Financial Results for the Nine Months of the Fiscal Year Ending March 31, 2018
(Millions of yen)
Presentation underJapanese GAAPNet income
Other comprehensive
incomeNet unrealized holding
gains (losses) on
available-for-salesecurities, net of taxes
Remeasurements ofdefined benefit plans, netof taxes

Foreign currencytranslation adjustments
Net unrealized gains(losses) on hedging
derivatives, net of taxes
Share of othercomprehensive incomeof associates accounted
for using equity method

Japanese GAAP

Reclassification

41,204–

Differences inrecognition andmeasurement(1,684)

3,348

–

232

3,580

G

(279)

–

(1,370)(1,649)

F

IFRS

Note

39,520(1,122)–(1,149)(2,271)

7

–

569

576

Presentation under IFRSProfitOther comprehensive
incomeItems that will not bereclassified to profit or
loss
Financial assets
measured at fair value
through othercomprehensive income
Remeasurements ofdefined benefit plans
Items that may bereclassified to profit orloss
Exchange differences ontranslation of foreign
operations
Cash flow hedges

0

–

–

0

Share of othercomprehensive incomeof associates accounted
for using equity method

Total othercomprehensive income

1,954

–

(1,718)236

Total othercomprehensive income

Comprehensive income

43,158–(3,402)39,756Comprehensive income
Comprehensive income
attributable to:Comprehensive income
attributable to owners of
the parent
Comprehensive income
attributable to noncontrolling interests

43,108–(3,405)39,703

50

–

3

53

24

Owners of parent

Non-controlling interests

Olympus Corporation (7733) Financial Results for the Nine Months of the Fiscal Year Ending March 31, 2018

Fiscal year ended March 31, 2017
(Millions of yen)Japanese GAAP

Reclassification

Differences inrecognition andmeasurement

Net sales
Costs of sales

748,050
256,708(3,148)2,468(4,345)
2,895

740,557
262,071

Gross profit
Selling, general andadministrative expenses

491,342(5,616)(7,240)478,486

414,855(5,616)(11,542)(1,253)–29,50814,323(23,858)(329)

13,932(3,998)(18,336)(27,757)(8,220)2,247
10,980(19,227)
–
–
–
–
(81)
(103)

71,192

Operating profit

2,166
10,877

Finance income
Finance costs

81,686–(19,205)

62,481

Profit before tax

3,471

–

16,20019,671

78,215–(35,405)

42,810Presentation underJapanese GAAP

Operating income
Non-operating income
Non-operating expenses
Extraordinary income
Extraordinary losses

Income before provision
for income taxes
Total
Net income

76,487
3,998
18,33627,757
8,220

IFRS

Note

Presentation under IFRSARevenue
A, B, D, F Cost of sales

Gross profit
Selling, general and
397,697 B, C, D, F
administrative expenses
Share of profit (loss) of(1,253)
investments accounted forusing equity method
5,650
G
Other income
13,994
Other expenses

E

Income taxes
ProfitProfit attributable to:

Net income attributable toowners of the parent
Net income attributable tonon-controlling interests

78,191–(35,408)

42,783

24

–

3

27

25

Owners of parent
Non-controlling interests

Olympus Corporation (7733) Financial Results for the Nine Months of the Fiscal Year Ending March 31, 2018
(Millions of yen)
Presentation underJapanese GAAPNet income
Other comprehensive
incomeNet unrealized holding
gains (losses) on
available-for-salesecurities, net of taxes
Remeasurements ofdefined benefit plans, netof taxes

Foreign currencytranslation adjustments
Net unrealized gains(losses) on hedging
derivatives, net of taxes
Share of othercomprehensive incomeof associates accounted
for using equity method

Japanese GAAP

Reclassification

78,215–Differences inrecognition andmeasurement(35,405)(15,391)–

16,526

1,135

G

1,169

–

1,550

2,719

F

IFRS

Note

42,810(12,020)–(762)(12,782)

7

–

1,140

1,147

Presentation under IFRSProfitOther comprehensive
incomeItems that will not bereclassified to profit or
loss
Financial assets
measured at fair value
through othercomprehensive income
Remeasurements ofdefined benefit plans
Items that may bereclassified to profit orloss
Exchange differences ontranslation of foreign
operations
Cash flow hedges

14

–

–

14

Share of othercomprehensive incomeof associates accounted
for using equity method

Total othercomprehensive income(26,221)–

18,454(7,767)

Total othercomprehensive income

Comprehensive income

51,994–(16,951)

35,043Comprehensive income
Comprehensive income
attributable to:Comprehensive income
attributable to owners of
the parent
Comprehensive income
attributable to noncontrolling interests

51,981–(16,955)

35,026

13

–

4

17

26

Owners of parent

Non-controlling interests

Olympus Corporation (7733) Financial Results for the Nine Months of the Fiscal Year Ending March 31, 2018

Notes on reconciliations of profit or loss and comprehensive income
1) Differences in recognition and measurement
A Leases
With regard to lease transactions as lessor, some of transactions classified as finance leases underJapanese GAAP are classified as operating leases under IFRS. Consequently, the relevant leasereceivables have been reversed, and property, plant and equipment have been recognized. In
addition, revenue and cost of sales have increased or decreased.
In light of the above, comprehensive income for the nine months ended December 31, 2016 andthe fiscal year ended March 31, 2017 decreased by ¥1,134 million and ¥2,874 million,
respectively.
B Depreciation of property, plant and equipment
With regard to depreciation of property, plant and equipment, the Olympus Group has reviewed
estimates of useful lives and residual values in adopting IFRS. Consequently, the carrying
amount of property, plant and equipment has decreased. In addition, cost of sales and selling,
general and administrative expenses have increased or decreased.
In light of the above, comprehensive income for the nine months ended December 31, 2016 andthe fiscal year ended March 31, 2017 decreased by ¥1,448 million and ¥1,490 million,
respectively.
C Goodwill
Under Japanese GAAP, goodwill was amortized on a straight-line method over the reasonable
number of years, not exceeding 20 years. However, under IFRS, amortization of goodwill on andafter the date of transition was discontinued, and impairment test is performed in each period.
In light of the above, comprehensive income for the nine months ended December 31, 2016 andthe fiscal year ended March 31, 2017 increased by ¥7,009 million and ¥8,912 million,
respectively.
D Capitalization of development expenses
Expenditures for research and development were expensed under Japanese GAAP. However,under IFRS, since certain expenditures are eligible for capitalization, those expenses arerecognized as intangible assets. In addition, cost of sales and selling, general and administrative
expenses have increased or decreased.
In light of the above, comprehensive income for the nine months ended December 31, 2016 andthe fiscal year ended March 31, 2017 increased by ¥1,773 million and ¥1,118 million,
respectively.
E Deferred taxes
With respect to the tax effects arising from the elimination of intercompany unrealized gains, thedeferral method was applied under Japanese GAAP, but the asset and liability approach has been
employed under IFRS.
In addition, the Olympus Group has assessed the recoverability of deferred tax assets under IFRS.
In light of the above, comprehensive income for the nine months ended December 31, 2016 andthe fiscal year ended March 31, 2017 decreased by ¥9,629 million and ¥22,823 million,
respectively.
Because temporary differences arose in line with the reconciliation from Japanese GAAP to IFRS,
the amounts of deferred tax assets and deferred tax liabilities have been adjusted. The effect of
the adjustments on retained earnings is stated in each other item.
F

Post-employment benefits
Under Japanese GAAP, actuarial gains or losses and past service costs were recorded in net
assets through other comprehensive income when they are incurred and were expensed on astraight-line method over a certain number of years not exceeding the average remaining service
period of employees. Under IFRS, actuarial gains or losses have been recognized in othercomponents of equity through other comprehensive income as incurred, and then immediately
27

Olympus Corporation (7733) Financial Results for the Nine Months of the Fiscal Year Ending March 31, 2018transferred to retained earnings. Past service costs have been fully recognized in profit or loss as
incurred.
In light of the above, comprehensive income for the nine months ended December 31, 2016 andthe fiscal year ended March 31, 2017 decreased by ¥1,632 million and ¥3,000 million,
respectively.
G Financial instruments
Under Japanese GAAP, gain on sales of investment securities was recorded as extraordinary
income. However, under IFRS, it is allowed to designate equity financial assets as financial
assets measured at fair value through other comprehensive income, and gain on sales of equity
financial assets that has been designated so is recognized as other comprehensive income.

2) Reclassification
H Reclassifications on the condensed consolidated statement of income
Certain rebates were presented in selling, general and administrative expenses under Japanese
GAAP, but are presented as deduction from revenue under IFRS.
With regard to items that were presented in non-operating income, non-operating expenses,
extraordinary income and extraordinary losses under Japanese GAAP, financial items have beenpresented in finance income or finance costs, and other items have been presented in share of
profit (loss) of investments accounted for using equity method, other income or other expenses
according to the nature of each item, under IFRS.
(4) Note on reconciliation of cash flows
Major differences between the consolidated statements of cash flows under Japanese GAAP and thoseunder IFRS are principally due to the change of lease transactions as lessor and capitalization of
expenditures for research and development. Accordingly, cash flows from operating activities haveincreased, and cash flows from investing activities have decreased.

28