CMK CORPORATION

2001 Annual Report

Year ended March 31, 2001

CMK CORPORATION
43F Shinjuku I-LAND TOWER Bldg.
6-5-1, Nishishinjuku, Shinjuku-ku, Tokyo 163-1388, Japan
Tel: +81-3-5323-0231
http://www.cmk-corp.com

Printed in Japan on recycled paper

Profile

CMK is keeping pace with the demand on printed wiringboards (PWBs) for compactness and greater functionality in products such as mobile phones. As a major concern in the field of PWBs, CMK pursues tightly focusedtechnological research and development. And as a leading manufacturer of PWBs, CMK has built up a strong
base of operations. CMK products are appreciated bycustomers all over the world. CMK challenges for continuous success in an increasingly competitive market.
At the same time, CMK pays attention to environmental
issues.

CMK—Invisible, but everywhere.
Audio-Visual

Directors andCorporate Statutory Auditors

Our single-sided, double-sided, silver through-hole PWBs andmore are used in CD players, MD players, VCRs and DVD players.

Chairman

Mobile Communications

Noboru Nakayama(As of March 31, 2001)(As of June 28, 2001)

We provide primarily multi-layered IVH and ALIVH boards(4~10 layers) for products such as mobile phones, PDA, etc.
®

Information Devices
Our 4 ~12 layered through-hole PWBs, 4~10 layered IVH PWBs
and Rigid-Flex (RF) build-up PWBs (RF-1, RF-3) can be found ina range of PCs and peripheral devices.

President
Eiji Watanabe
Vice President
Kameharu Seki
Senior Managing Director

Displays

Norimasa Sato

We produce double-sided PWBs, 4~12 layered through-hole
PWBs, 4~10 layered IVH PWBs for LCDs, PDP displays andmore.

Managing Directors

Substrates for Semiconductor Packages(Rigid type, tape type)

Takahiro Nakayama

EstablishedFebruary 1961
Capital¥16.1 1 billion
Employees
6,180 (CMK Group)
Business Activities
Research and Development, production and sales of PWBs andelectronic devices.
Major Shareholders
Number ofshares held(Thousands)

Kuniaki Kanemoto

Shareholders

Shigeyuki Seki

Nippon Trustee Service Bank, Ltd. (Trustee account)
Noboru Nakayama
The Dai-ichi Mutual Life Insurance Company
The Industrial Bank of Japan, Limited
Sumitomo Bakelite Co., Ltd.
Matsushita Electric Works, Ltd.
The Tokyo Trust and Banking Corporation /The Nippon Trust and Banking Corporation /Retirement Benefit for Hitachi Chemical Co., Ltd.
Naohiko Seki
The Sakura Bank, Limited
The Tokyo Tomin Bank, Limited

Susumu Yasuma

Our PWBs accommodate main components such as CPUs, DSPs,
DRAM, SRAM, flash memory and more.

Directors

Car Electronics

Masakazu Takemoto

Our PWBs are installed in automotive electronic equipment likeengine control systems, ABS, SRS air bags, instrument panels, carnavigation systems, etc.

Takeo Takai
Kunio Nishi
Mamoru Manaka
Corporate Statutory Auditors
Hirofumi Shinjobo
Takashi Watanabe
Hideaki Takahashi
Mitsuo Honjo

CONTENTS
01 Financial Highlights
02 Message from the Management
03 Mid-Term Business Strategy
07 Financial Section
22 Group Companies
23 Directors and Corporate Statutory Auditors
23 Corporate Data

Corporate Data

Percentage
(%)

4,881
3,820
2,345
2,258
1,896
1,860

9.17
7.17
4.40
4.24
3.56
3.49

1,822
1,631
1,549
1,545

3.42
3.06
2.91
2.90

Correspondent BanksThe Industrial Bank of Japan, Limited
The Sakura Bank, Limited
The Sumitomo Bank, Limited
The Fuji Bank, Limited
The Daiwa Bank, Limited
The Tokyo Tomin Bank, Limited
Accounting Period
March 31Principal Clients
Matsushita Electric Industrial Co., Ltd.
Sony Corporation
Toshiba Corporation
Pioneer Corporation
Seiko Epson Corporation
Casio Computer Co., Ltd.

Cautionary Statement with Respect to Forward-Looking Statements
Statements made in this annual report with respect to CMK’s plans, strategies
and beliefs and other statements that are not historical facts are forward-looking
statements about the future performance of CMK, which are based on management’s assumptions and beliefs in light of the information currently available toit, and involve risks and uncertainties. Potential risks and uncertainties include,
without limitation, general economic conditions in CMK’s markets; industrial
market conditions; exchange rates in which CMK makes significant sales or inwhich CMK’s assets and liabilities are denominated; and CMK’s ability to continue to win acceptance of its products and services, which are offered in highly
competitive markets characterized by the continual introduction of new products, rapid developments in technology, and changing customer preferences.

CMK CORPORATION 2001 Annual Report 23

Financial Highlights
CMK CORPORATION and Consolidated Subsidiaries
Years ended March 31, 2001, 2000 and 1999

Yen
(Millions)Operating Results:
For the year
Net sales
Income (loss) before income taxes
Net income (loss)
Net income (loss) per share··· Basic··· Diluted
At year-end
Shareholders’ equity
Total assets

U.S. Dollars(Thousands)

2001

2000

1999

2001

¥122,293
7,220
4,182

¥121,246
4,071
1,147

¥113,448(1,992)(2,542)$987,030
58,27333,753

80.36
69.75

22.21
19.74

(49.20)
—

0.649
0.563

¥ 52,822
144,749¥ 48,407
152,087¥ 47,451
159,902$ 426,328
1,168,273

Note: U.S. Dollars amounts have been translated from Yen, for convenience only, at the rate of ¥123.90 = $1, the Tokyo foreign exchange market rate as of March 31, 2001.

Net Sales
Yen (Millions)1997

114,575

1998

126,552

1999

113,448

2000

121,246

2001

122,293030,00060,00090,000120,000

150,000

Income before income taxes
Net Income

Income before Income Taxes and Net Income
Yen (Millions)
2,508

1997

1,361
3,058

1998

890
-1,9921999-2,542
4,071

2000

1,147
7,220

2001

4,182

-4,000-2,000

0

2,000

4,000

Yen
26.32

1997
17.21

1998
-49.20

22.21
19.74

2000

80.36

2001
-60

8,000

Basic
DilutedNet Income per Share

1999

6,000

69.75

-30

0

30

60

90

CMK CORPORATION 2001 Annual Report 1

Message from the Management

Achievements This Term

Noboru Nakayama
Chairman

Eiji Watanabe
President

During the first half of the fiscal year, Japan’s economy experienced an upswing in exports owing to economic recovery in Asia and increasing worldwide
demand for information technology (IT). However, due to slow improvement in
the employment rate and a poor income circumstance, economic recovery remains stagnant. Moreover, the world wide recession in the second half of theyear is weakening efforts to revive the economy.
Our sales for the first half of the year was encouraging, due to the rising demand worldwide for mobile phones, personal computers and related electronic
goods. However, in the second half of the year, owing to decrease in demand formobile phones and personal computers, the market has slowed down considerably.
Under the business conditions outlined above, our consolidated record
showed sales of 122.29 billion yen. It was an increase of more than 1.04 billion
yen compared to the previous period (increase of 0.9%). Favorable demand in
the first half of the year increased our income before income taxes to 7.22 billion
yen—an increase of 77.4% over the previous period.
CMK is making a concerted effort to reward our investors with increasing
profits. We thank you all for your continuous support.
June 2001

Noboru Nakayama
Chairman

Eiji Watanabe
President

2 CMK CORPORATION 2001 Annual ReportMid-Term Business Strategy

1. Corporate Reorganization
To assure the expansion and continuance, we have established two new
projective departments.
• Strategic Marketing Development
OfficeWe set up this office to support oursales division based on the development of new products and new business models.
• PMT Business Promotion Office(Package Method Technology)
To concentrate on the future of
PWBs, we are promoting a businessplan that takes in the next step of theelectronics market.
2. Overseas Production Plan
In order to reduce costs of operationand shorten the term of delivery, we
are focusing on production in China.
• CMKS (CHINA) FACTORY
Our new factory in China opened in
March 2001 and is now in operation.
The factory merges our strengths
with the low cost of manufacturing.
It gives us a substantial production
base in Asia.

• CMKC (DONG GUAN) LTD.
This is the first of our overseas plants
to manufacture through-hole PWBs
and has productive capacity of
20,000m2 per month.
• CMK ELECTRONICS (WUXI)CO., LTD.
This is the first of our overseas plants
to manufacture build-up multi-layered PWBs. As a major player in thismarket, CMK expands its factory operations abroad. (Start operation in
April 2002)

5. Focus on Cash-Flow
Management
For the efficient financial structure,
we continue progressing Asset
Liability Management and promoting
intra-group alliances.
6. Environmental Protection
CMK works on CO2 reduction and energy saving. In addition, our products
are developed with strict regard totheir environmental impact. In adhering to this policy, we will improve ourcorporate environmental activities.

3. Streamlining of Corporate
Structure
We are reorganizing our plants inJapan to keep pace with changing
market conditions. At the same time,
we allocate resources to high-end
products.
4. Research and Development
Geared to Profit
Our research and development focuseson profitable goods. Especially, we
keep pace with advanced technologyof semiconductor devices by developing high-density build-up multi-layered PWBs. We are also gauging theway we can reduce the cost of conventional products while increasing theirvalue.

Target for F Y 2003 : ROA 10% ROE 13%
Current Three Years

ROA
ROE

FY 2001
6.5%
8.3%

2000
3.3%
2.4%

1999
0.8%
—

CMK CORPORATION 2001 Annual Report 3

Mid-Term Business Strategy

Focus on Group Operations
Global Outlook of the CMK GroupCMK is well-known for its extensive
product lineup and the production
technology. We have achieved thisstatus in Japan through the support ofour associates. Our target is to acquire
the same reputation in world wide. To
this end we have worked towards establishing an organization that can respond to customer demands quickly.

NIIGATA SATELLITE PLANT
From double-sided to multi-layered PWBs that
achieve high-performance.
• CMK MULTI CORPORATION• CMK NIIGATA CORPORATION1CMK KANBARA ELECTRONICCORPORATION JAPANDouble-sided multi-layered PWBs built to theexacting standards of the automotive industry.
2

JT CMK CORPORATION
Joint-venture with Japan Tobacco Inc. overproduction of double-sided and multi-layered
PWBs.
3

KIBAN Center Plant
Manufacture of single-sided and inner layer ofmulti-layered PWBs.
4

1
3

2

G-Station Plant
Manufacture of double-sided and multilayered PWBs.
5

4•5•6

7

Plant
Sales Office

Other Offices, Plants andAssociated Companies in Japan■ SE Center■ SE PRODUCTS CORPORATION■ CMK MECHANICS CORPORATION■ CMK HI-TECHS CORPORATION■ CMK DRILLING CORPORATION■ YAMANASHI SANKOH CORPORATION■ ISHIZUKA MFG. CO., LTD.
■ WAKOH ELECTRONICS CORPORATION

4 CMK CORPORATION 2001 Annual Report

6 Technical Center Plant
Research & development facilities and manufacture of PWBs for semiconductor package.

CMK CIRCUIT TECHNOLOGYCENTER CORPORATION
Offer the most advanced systems for highgrade PWB circuit designing.
7

Shift towards overseas production
The trend towards overseas production
by electronics manufacturers has expanded the market for PWBs. We
have been developing our overseas
production facilities in these decades.
We began our expansion into
Asian region with the establishment ofa manufacturing subsidiary in 1980
Singapore, in 1989 Malaysia and in1994 Indonesia. Owing to continuing
demand in European region, we
opened plant in Belgium in 1987.
In addition to above factories, westarted production in China in March
2001.
In 1991 we established a company
in Malaysia to provide manufacturing
materials for our overseas associates.
We are developing global network ofsales and manufacturing.

1

6

3
5

2

4

Plant
Sales Office

CMK EUROPE N. V.
Manufacture and sales of single-sided, doublesided and silver through-hole PWBs.
1

CMKS (CHINA) FACTORY
Manufacture of single-sided, silver throughhole PWBs.
2

CMKS (MALAYSIA) SDN. BHD.
Manufacture and sales of single-sided, doublesided and silver through-hole PWBs.
3

4 CMK SINGAPORE (PTE.) LTD.
Manufacture and sales of single-sided, doublesided PWBs.

P. T. CMKS INDONESIA
Manufacture of single-sided PWBs.
5

Other Companies Overseas■ CMKC (DONG GUAN) LTD.
■ CMK SINGAPORE (PTE.) LTD.
BANGKOK REPRESENTATIVE OFFICE■ CMKS (MALAYSIA) SDN. BHD.
PENANG SALES OFFICE■ CMKS (MALAYSIA) SDN. BHD.
KUALA LUMPUR OFFICE■ CMKS (HONG KONG) CO., LTD.
■ CMKC (HONG KONG) LIMITED■ Nippon CMK Corporation (U.S.A.)CMK ELECTRONICS (WUXI) CO., LTD.
Manufacture of build-up PWBs.
(Start operation in April 2002)
6

CMK CORPORATION 2001 Annual Report 5

Mid-Term Business Strategy

High-end Products Lineup
CLLAVIS seriesThis series is optimized to accommodate thelatest high-density chips required for laptop
PCs and other compact information stations.

Build-up Multi-Layered PWBs

ALIVH® seriesThis series contributed to bring down theweight of mobile phones less than 100 grams.
The series can make circuit design rule flexible, and is used extensively in mobile phones
and portable AV equipment.
(ALIVH ® is the registered trademark of Matsushita ElectricIndustrial Co., Ltd.)RF series
This series is the combination of flexible andrigid constructions. The RF PWBs can be
partly bent or twisted, and are perfect for installation in products such as digital cameras.

IVH Multi-Layered PWBs

These PWBs are extensively used for mobile
phones and mobile information terminals.
They enable increased density of circuits andmounted components.
(IVH stands for “Inner Via Hole”)

Rigid substrate
Technology of PWB is required for the more
minute field of semiconductor devices. Rigid
substrate is applicable for its thinness andcompactness.

Package Substrates

Tape substrate
Technology which realize especially fine circuit, high-density and thinness. Tape substrate
make it possible to assemble super fine chips.

‘‘E-Spec’’ PWBs
In order to supply environment-conscious products, we have set our own evaluation standard, “E-spec”.
This self-imposed standard encourages CMK’s responsibilities for developing products with regard to theirenvironmental impact.
“E-spec” mark‘‘E-Spec’’ is a registered trademark of CMK CORPORATION.

6 CMK CORPORATION 2001 Annual ReportFinancial Section

08
10
11
12
13
21

CONTENTS
Consolidated Balance Sheets
Consolidated Statements of Income
Consolidated Statements of Shareholders’ Equity
Consolidated Statements of Cash Flows
Notes to Consolidated Financial Statements
Independent Auditors’ ReportFive-Year Summary
CMK CORPORATION and Consolidated Subsidiaries
Years ended March 31, 2001, 2000, 1999, 1998 and 1997

Yen
(Millions)

U.S. Dollars(Thousands)

2001

2000

1999

1998

1997

2001

For the year
Sales
Operating income (loss)
Net income (loss)¥122,293
9,284
4,182

¥121,246
4,945
1,147

¥113,448
895(2,542)¥126,552
9,905
890¥114,575
6,801
1,361

$0,987,030
74,93133,753

At year end
Shareholders’ equity
Total assets

52,822
144,749

48,407152,087

47,451
159,90250,992
156,271

51,197
144,936426,328
1,168,273

Yen

Per Share
Net income···Basic···Diluted
Price at Tokyo Stock Exchange
High
Low
Cash dividends

U.S. Dollars¥80.3669.75¥22.2119.74¥(49.20)–¥17.21–¥26.32–$0.649
0.563

2,390
1,130
10.00

1,600
1,005
10.00

1,810
980
10.00

1,790
1,090
10.00

1,850
1,200
10.00

19.28
9.12
0.08

%

RatiosEquity Ratio
Return on Equity
Price Earnings Ratio

36.5
8.3
16.8

31.8
2.4
54.9

29.7
–
–

32.6
1.7
76.7

35.3
2.7
46.4

Number of employees (Person)

6,180

6,103

–

–

–

Note: U.S. Dollars amounts have been translated from Yen, for convenience only, at the rate of ¥123.90 = $1, the Tokyo foreign exchange market rate as of March 31, 2001.

CMK CORPORATION 2001 Annual Report 7

Consolidated Balance Sheets
CMK CORPORATION and Consolidated Subsidiaries
Years ended March 31, 2001, and 2000

ASSETS
Current assets:
Cash and time deposits (Note 5)
Marketable securities (Note 3 & 5)
Trade receivable:
Notes and accounts (Note 6 & 13)
Allowance for doubtful accounts
Net trade receivable
Inventories (Note 4)
Deferred income taxes (Note 9)
Other current assets (Note 6)
Total current assets

Property, plant and equipment (Note 7 & 10):Land
Buildings
Machinery and equipment
Construction in progress
Less accumulated depreciation

Investments and other assets:
Investments in securities (Note 3 & 6)
Long-term loans (Note 6)
Deferred income taxes (Note 9)
Other

The accompanying notes are an integral part of these statements.

8 CMK CORPORATION 2001 Annual Report

Yen(Millions)

U.S.Dollars(Thousands)

March 31

March 31

2001

2000

2001

¥ 13,968
376¥ 18,220420$ 112,736
3,035

33,599(147)
33,452
9,917
537
1,160
59,41033,930(187)
33,743
10,564569
1,220
64,736271,178(1,186)
269,992
80,0404,334
9,363
479,500

14,15254,524
98,858480
168,01499,43068,584

14,18154,88593,040957
163,063
93,03770,026114,221440,065
797,885
3,874
1,356,045
802,502553,543

9,893
569
1,088
5,205
16,755¥144,749

11,141
310
744
5,130
17,325¥152,087

79,8474,592
8,781
42,010135,230$1,168,273

LIABILITIES AND SHAREHOLDERS’ EQUITYCurrent liabilities:
Short-term bank loans
Current portion of long-term debt (Note 7)
Trade payable:
Notes and accounts (Note 6)
Income taxes payable (Note 9)
Other current liabilities (Note 6 & 9)
Total current liabilities

Yen(Millions)

U.S.Dollars(Thousands)

March 31

March 31

2001
¥

5,632
11,647

2000
¥

6,942
13,665

2001$

45,45694,003

12,423
1,911
12,49644,10916,8192,552
9,061
49,039100,266
15,424
100,856
356,005

Long-term liabilities:
Long-term debt (Note 7)
Reserve for pension and severance benefit (Note 12)
Reserve for retirement benefit for directors and statutory auditors
Other (Note 9)
Total long-term liabilities

41,718115643
869
43,345

50,110–504
720
51,334

336,707
928
5,190
7,014
349,839

Minority interests in subsidiaries

4,473

3,307

36,101

Contingent liabilities (Note 13):
Shareholders’ equity (Note 8):
Common stock of ¥50 per value
Authorized : 199,871,000 Shares
Issued:March 31, 2001; 53,205,124 Shares
March 31, 2000; 51,553,131 Shares
Additional paid-in capital
Retained earnings
Unrealized gains on securities
Foreign currency translation adjustments
Treasury stock, at cost
Total shareholders’ equity

16,117
15,87524,038222(2,060)54,192(1,370)52,822¥144,749

130,081
14,821
14,57820,422–(1,413)
48,408(1)
48,407¥152,087

128,128
194,011
1,792(16,627)
437,385(11,057)
426,328$1,168,273

CMK CORPORATION 2001 Annual Report 9

Consolidated Statements of Income
CMK CORPORATION and Consolidated Subsidiaries
Years ended March 31, 2001, 2000 and 1999

Net sales (Note 14)
Cost of sales
Gross profit
Selling, general and administrative
expenses
Operating income (Note 14)
Other income (expenses):
Interest and dividend income
Interest expenses
Other, net
Income (loss) before income taxes
Income taxes (Note 9)
Income (loss) before minority interests
Minority interests in subsidiaries
Net income (loss)

Yen(Millions)

U.S.Dollars(Thousands)

Year ended March 31

Year ended March 31

2001

2000

1999

2001

¥122,293
101,878
20,415¥121,246
104,608
16,638¥113,448
101,355
12,093$987,030
822,260
164,770

11,131
9,284

11,693
4,945

11,198895

89,83974,931349(1,484)
(929)
7,220
2,562
4,658
(476)
¥ 4,182

228(1,795)
693
4,071
2,611
1,460
(313)
¥ 1,147420(2,614)(693)(1,992)661(2,653)111¥ (2,542)

2,817(11,977)(7,498)58,273
20,67837,595(3,842)$ 33,753

Yen

Per share of common stock:
Net income (loss)Basic
DilutedCash dividends, applicable to period
The accompanying notes are an integral part of these statements.

10 CMK CORPORATION 2001 Annual Report

¥

80.36
69.75
10.00

¥

22.21
19.74
10.00

U.S.Dollars¥ (49.20)
–
10.00

$

0.649
0.563
0.081

Consolidated Statements of Shareholders’ Equity
CMK CORPORATION and Consolidated Subsidiaries
Years ended March 31, 2001, 2000 and 1999

Yen
(Millions)

Balance at March 31, 1998
Net income (loss)
Cash dividends
Bonuses to directors and statutory auditors
Increase due to consolidation of subsidiaries
not consolidated in the previous year
Translation adjustment
Purchase of treasury stock
Reissuance of treasury stock
Retirement of treasury stock (Note 8)
Balance at March 31, 1999
Net income
Cash dividends
Bonuses to directors and statutory auditors
Increase due to consolidation of subsidiaries
not consolidated in the previous year
Increase due to retroactive effect ofaccounting for deferred income taxes
Translation adjustment
Purchase of treasury stock
Reissuance of treasury stock
Retirement of treasury stock (Note 8)
Balance at March 31, 2000
Conversion of convertible bonds
Net income
Cash dividends
Bonuses to directors and statutory auditors
Unrealized holding gains arising during the period
Translation adjustment
Purchase of treasury stock
Reissuance of treasury stock
Balance at March 31, 2001

Unrealized
gains onsecurities

Foreigncurrencytranslation
adjustment

Treasurystock, at cost¥¥

Commonstock

Additional
paid-in capital

Retainedearnings¥ 14,821–––¥ 14,578–––¥ 21,819(2,542)
(517)
(55)

–
–
–
–
–
¥ 14,821
–
–
–

–
–
–
–
–
¥ 14,578
–
–
–

89
–
–
–
(24)
¥ 18,770
1,147
(528)
(53)

–

–

266

–

–

–

–
–
–
–
–
¥ 14,821
1,296
–
–
–
–
–
–
–
¥ 16,117–––––¥ 14,578
1,297
–
–
–
–
–
–
–
¥ 15,875

932
–
–
–
(112)
¥ 20,422
–
4,182
(515)
(51)
–
–
–
–
¥ 24,038

–
–
–
–
–
¥
–
–
–
–
–
222
–
–
–
¥ 222

–
(698)
–
–
–
¥ (1,413)
–
–
–
–
–
(647)
–
–
¥ (2,060)

–
–
(182)
72
112
¥
(1)
–
–
–
–
–
–
(1,536)167¥ (1,370)

Foreigncurrencytranslation
adjustment

Treasurystock, at cost

¥

¥

–
–
–
–
–
–
–
–
–
–
–
–
–

¥

(225)
–
–
–
–
(490)
–
–
–
(715)
–
–
–

¥

(1)
–
–
–
–
–
(78)
52
24
(3)
–
–
–

U.S.Dollars(Thousands)
Commonstock

Additional
paid-in capital

Retainedearnings

Balance at March 31, 2000
$119,621
Conversion of convertible bonds
10,460Net income–
Cash dividends–
Bonuses to directors and statutory auditors–
Unrealized holding gains arising during the period–
Translation adjustment–
Purchase of treasury stock–
Reissuance of treasury stock–
Balance at March 31, 2001
$130,081
The accompanying notes are an integral part of these statements.

$117,660
10,468
–
–
–
–
–
–
–
$128,128$164,826–
33,753(4,156)
(412)
–
–
–
–
$194,011

Unrealized
gains onsecurities

$

–
–
–
–
–
1,792
–
–
–
$1,792$(11,405)–––––(5,222)––$(16,627)

$

(8)
–
–
–
–
–
–
(12,397)
1,348$(11,057)

CMK CORPORATION 2001 Annual Report 11

Consolidated Statements of Cash Flows
CMK CORPORATION and Consolidated Subsidiaries
Years ended March 31, 2001, 2000 and 1999

Yen
(Millions)

U.S.Dollars(Thousands)

Year ended March 31

Year ended March 31

2001

2000

1999

2001

¥ 4,182¥ 1,147¥ (2,542)¥ 33,753

10,344
189
140
(508)
791

12,561
219
(36)
(345)
(223)

11,192
838
(52)
–
(568)

83,4871,525
1,130(4,100)
6,384

520
773
(4,586)(749)
3,376
14,472(1,334)(2,191)
1,117
2,974
2,057
15,946

3,038
1,891
752
(3,406)(1,840)
9,303

4,197
6,239
(37,014)(6,045)27,248116,804

Cash flows from operating activities:
Net income (loss)
Adjustments to reconcile net income
to net cash provided by operating activities:
Depreciation and amortization
Loss on disposal of fixed assets
Provision for directors and statutory auditors’ retirement benefit
Deferred income taxes (Note 9)
Other, net
Changes in assets and liabilities:(Increase) decrease in trade accounts and notes receivable(Increase) decrease in inventories
Increase (decrease) in trade payable
Increase (decrease) in income taxes payable
Changes in other current assets and liabilities
Net cash provided by operating activities
Cash flows from investing activities:
Decrease (increase) in investments and advances
Payment for purchase of property, plant and equipment
Proceeds from sales of property, plant and equipment
Other, net
Net cash used in investing activities
Cash flows from financing activities:
Increase (decrease) in short-term debt
Repayment of long-term debt
Proceeds from long-term debt
Cash dividends paid
Contributions from minority interests
Other, net
Net cash provided by (used in) financing activities
Effect of exchange rate changes
Net changes in cash and cash equivalents
Cash and cash equivalents at beginning of year
Cash and cash equivalents at end of year (Note 5)(492)(7,455)1,119(240)(7,068)1,080(12,028)653
3,404(6,891)(5,848)(18,034)
1,829
(723)
(22,776)(3,971)(60,170)
9,032(1,937)(57,046)(1,372)(10,290)
2,150
(515)
–
(773)
(10,800)(975)(4,371)
18,505¥14,134(4,065)(11,436)
6,000
(523)
–
(521)
(10,545)(538)(2,028)20,533¥18,505

61(21,098)
30,746
(517)
984
(62)
10,114(523)(3,882)
24,415¥20,533(11,073)(83,051)
17,353(4,157)–(6,239)(87,167)(7,869)(35,278)
149,354¥114,076

Supplemental data:
Cash paid (refund) during the year forIncome taxes
Interest¥ 3,819
1,495

¥(19)
1,801

¥4,0672,614¥ 30,823
12,066

The accompanying notes are an integral part of these statements.

12 CMK CORPORATION 2001 Annual ReportNotes to Consolidated Financial Statements
CMK CORPORATION and Consolidated Subsidiaries

1. Summary of significant accounting policies(a) Basis of presenting consolidated financial statements
The accompanying consolidated financial statements of CMKCORPORATION (the “Company”) and its consolidated subsidiaries have been prepared from the consolidated financial
statements filed with the Ministry of Finance as required by
the Securities and Exchange Law of Japan, in conformity withgenerally accepted accounting principles in Japan.
Certain reclassifications have been made to present theaccompanying consolidated financial statements in a format
which is familiar to readers outside Japan.
(b) Principle of consolidation
The Company had 24 and 21 subsidiaries as of March 31, 2001
and 2000, respectively. The consolidated financial statements
included the accounts of the Company and its 18 and 18 significant subsidiaries as of March 31, 2001 and 2000, respectively.
Intercompany accounts and significant intercompany transactions have been eliminated on consolidation.
The investments in (20% to 50% owned) affiliates, except
some of them, are accounted for by the equity method.
Non-consolidated subsidiaries and a part of investments inaffiliates are stated at cost because of their immateriality.
Earnings of these companies are recorded in the Company’sbooks only to the extent that cash dividends are received.
The difference between the cost of investments in consolidated subsidiaries and the equity in their net assets at dates ofacquisition is amortized, on a straight-line basis, over five years.
(c) Cash and cash equivalents
Starting on April 1, 1999 the Company adopted a new accounting standard which requires the preparation of Statement of
Cash Flows. Accordingly the cash and cash equivalents
include certificates of deposit, bank deposit with a maturity of
three months or less which can be withdrawn without any
restriction, and highly liquid debt instruments purchased with amaturity of three months or less.
Previously, cash and cash equivalents included certificatesof deposit, bank deposits with a maturity of one year or lesswhich could be withdrawn without any restriction, and highly
liquid debt instruments purchased with a maturity of threemonths or less.
(d) Marketable securities and investment securities
Starting on April 1, 2000 the Company and its domestic subsidiaries adopted a new accounting standard for financial
instruments.
Debt and equity securities are classified in one of three categories: available-for-sale, trading, or held-to-maturity. Debt
securities that are classified as “held-to-maturity” securities arereported at amortized cost. Debt and equity securities that areclassified as “trading” securities are reported at fair value, withunrealized gains and losses included in earnings. Other debt
and equity securities are classified as “available-for-sale” securities and are reported at fair value at the closing date, withunrealized gains or losses net of deferred taxes, included inunrealized gains (losses) on securities in the stockholders’equity section of the consolidated balance sheet. Realized
gains and losses are determined on the moving average cost
method and reflected in income.
Previously, marketable securities and investment securities
were stated at cost determined by the moving average method.
(e) Inventories
For the company and its subsidiaries in Japan, merchandise
except for molds, raw materials, finished goods and work inprocess are stated at cost determined by the average method.
Molds are stated at cost determined by the specific identification method. Subsidiaries outside of Japan, inventories arevalued at lower of cost or market, which are determined bymoving average method.
(f) Property, plant and equipment
Property, plant and equipment are stated at cost. Depreciationin domestic subsidiaries is computed by the declining-balancemethod at rates based on estimated useful lives of the respective assets according to general class, type of construction anduse. For subsidiaries outside Japan, depreciations are computed
by straight-line method. Significant renewals and additions arecapitalized at cost. Maintenance, repairs, minor renewals andbetterments are charged to income as incurred.
(g) Accounting for leases
In Japanese Accounting Standards, finance leases other thanthose which are deemed to transfer the ownership of the leased
assets to lessees are accounted for by the method similar to thatapplicable to ordinary operating leases.
(h) Income taxes
Starting on April 1, 1999 the Company adopted a new accounting standard which requires for the accounting of recognition andmeasurement of deferred tax assets and tax liabilities, for the
expected future tax consequences of temporary differences
between the carrying amounts and the tax bases of assets and liabilities. The assets and liabilities approach is used to recognize
deferred tax assets and tax liabilities. The cumulative effect onretained earnings at March 31, 1999 was stated as increase due toretroactive effect of accounting for deferred income taxes instatement of shareholders’ equity for year ended March 31, 2000.
CMK CORPORATION 2001 Annual Report 13

Previously, income taxes were provided for items of revenue and expense reported in the income tax returns on thebasis of when such items are taxable or deductible.
(i) Retirement and pension plans
Starting on April 1, 2000 the Company and its domestic subsidiaries adopted a new accounting standard for employee’s
retirement benefits.
In accordance with the new accounting standard, all of thebenefit obligation exceeding plan assets at March 31, 2000 (the“transition obligation”) was included in periodic benefit costs
for the year ended March 31, 2001. The transition obligation atMarch 31, 2000 is assumed to be ¥ 19 million ($ 153 thousand).
The Company and its subsidiaries in Japan have various
defined benefit pension plans and severance indemnity plans.
The Company provided for retirement allowance to directors
and statutory auditors based on their pertinent rules which calculates the estimated amount to be paid if all directors and statutory
auditors retired at the balance sheet date.
(j) Research and development costs
Research and development costs are charged to income as
incurred.
(k) Foreign currency translation
All asset, liability, income and expense accounts of foreignsubsidiaries and affiliates are translated into Japanese Yen at
appropriate year-end currency rates, and the shareholders’equity accounts except for retained earnings are translated athistorical rates. The resulting translation adjustments are pre-sented as “Foreign currency translation adjustments” in theaccompanying consolidated financial statements.
Starting on April 1, 2000 the Company and its domestic
subsidiaries adopted a new accounting standard for translationof assets and liabilities. Monetary assets and liabilities in foreign currencies are translated into Japanese Yen at applicablecurrent year-end rates, and other assets and liabilities are translated at historical rates, and differences due to translation are
credited or charged to income as incurred.
Previously, monetary current assets and liabilities in foreign
currencies were translated into Japanese Yen at applicable current year-end rates, and other assets and liabilities weretranslated at historical rates, and differences due to translation
were credited or charged to income as incurred.
(l) Net income and dividends per share
Basic net income per share is computed based on theweighted-average number of shares outstanding during eachperiod, and diluted net income per share assumes the dilutionthat could occur if convertible bonds or similar securities wereconverted into common stock or exercised to result in theissuance of common stock.
Cash dividends per share reflect cash dividends applicableto the respective periods.
(m) Reclassifications
Certain reclassifications of the financial statements and related
footnote amounts in the years ended March 31, 2000 and 1999
have been made to conform to the presentation in the year
ended March 31, 2001.

2. Translation into U.S. Dollars
The consolidated financial statements presented herein are
expressed in Japanese Yen and, solely for the convenience ofthe reader, have been translated into U.S. Dollars at the rate of¥123.90 = U.S. $1, the exchange rate on March 31, 2001. The

translations should not be construed as representation that theJapanese Yen amounts actually represent, or have been or
could be converted into U.S. Dollars.

3. Marketable securities and investments
The cost and fair value of marketable securities and investments as of March 31, 2001 are shown below:

Debt and equity securities – available-for-sale:
Cost
Gross unrealized gains
Gross unrealized losses
Amount in balance sheet
Non-marketable securities are not included in the above cost and fair value.
14 CMK CORPORATION 2001 Annual Report

Yen(Millions)

U.S. Dollars(Thousands)

2001

2001

¥3,593807(424)¥3,976$28,999
6,513(3,422)$32,090

4. Inventories
Inventories at March 31, 2001 and 2000 comprise the following:
Yen(Millions)

Merchandise
Finished goods
Work in process
Raw materials and supplies

2001¥ 2,013
2,405
3,447
2,052
¥ 9,917

U.S. Dollars(Thousands)

2000¥ 1,718
2,212
4,759
1,875
¥10,5642001$ 16,247
19,411
27,821
16,561$ 80,040

5. Cash and cash equivalents
Cash and cash equivalents included in the consolidated statement of cash flows comprise the following balance sheet amounts at
March 31, 2000 and 2001:
Yen(Millions)

Cash and time deposits
Marketable securities
Deposits with a maturity of three months or more
Bank over draft
Securities and others
Cash and cash equivalents

2001¥13,968
376
(187)
–
(23)
¥14,134

U.S. Dollars(Thousands)

2000¥18,220
420
(49)
(11)
(75)
¥18,505

2001$112,736
3,035(1,509)–(186)$114,076

Conversion of convertible bonds into common stock and additional paid-in capital was ¥2,592
million($20,920 thousand) for the year ended March 31, 2001.
6. Accounts with Related Parties
Accounts with the non-consolidated subsidiaries and affiliates are shown below:
Yen(Millions)

Investment in securities of the non-consolidated
subsidiaries and affiliates
Long-term loans
Trade receivable–Notes and accounts
Other current assets
Trade payable–Notes and accounts
Other current liabilities

U.S. Dollars(Thousands)

2001

2000

2001

¥ 2,704
232
25
45
385
23

¥ 3,697
250
–
10
727
30

$ 21,824
1,873
202
363
3,107
186

CMK CORPORATION 2001 Annual Report 15

7. Long-term debt
Long-term debt at March 31, 2001 and 2000 is as follows:
Yen(Millions)

Unsecured bonds:
1st series, due 2003, interest 2.25%
Unsecured convertible bonds:
3rd series, due 2005, interest 0.7%
Loans, principally from banks and insurance company:
Secured, due 2001〜2008 interest 1.875%〜8.1%
Secured, due 2000〜2008 interest 1.875%〜5.5%
Unsecured, due 2001〜2005 interest 1.5%〜7.35%
Unsecured, due 2000〜2005 interest 1.85%〜8.5%
Less current portion

The indentures covering the 3rd series convertible bonds provide, among other condition, for (1) the conversion into sharesof common stock at the current conversion prices of ¥ 1,569.00
per share, (subject to change in certain circumstances), and (2)U.S. Dollars(Thousands)

2001

2000

2001

¥20,000¥20,000$161,421

12,40815,000100,145

3,658

29,524
6,350

17,29953,365
11,647¥41,718

139,620
22,425
63,775
13,665¥50,110430,71094,003$336,707

conversion period to September 29, 2005.
As of March 31, 2001 and 2000, long-term debt is secured byproperty, plant and equipment with a net value of ¥13,905 million ($112,233 thousand) and ¥15,452 million, respectively.

The aggregate annual maturities of long-term debt are as follows:Year ending March 31

2002
2003
2004
2005
2006
2007 and thereafter

Yen(Millions)

U.S. Dollars(Thousands)¥11,647
6,178
22,333575
12,561
71¥53,365$94,003
49,863
180,250
4,641
101,380573$430,710

8. Shareholders’ equity
The Japanese Commercial Code provides that the amount notexceeding one-half of the issue price of shares may not becredited to the stated capital, provided that, with respect to theshares with face value, it shall be limited to the face value.
The Company set a provision in its articles of incorporation

16 CMK CORPORATION 2001 Annual Reportthat the Company may acquire its own shares, upon resolutionof the Board of Directors, within the maximum limit of 5,000
thousands shares to retire by offsetting the related purchasecosts against retained earnings.

9. Income taxes
The Company and its domestic subsidiaries are subject to anumber of taxes computed on income. The aggregated result of

normal tax rates were approximately 42% for the year ended
March 31, 2001 and 2000.

Income tax expense comprise the following:
Yen(Millions)

Income taxes:
Current
Deferred

U.S. Dollars(Thousands)

2001

2000

2001

¥ 3,070(508)¥ 2,562¥ 2,956(345)¥ 2,611$ 24,778(4,100)$ 20,678

The significant components of deferred tax assets and liabilities are as follows:
Yen(Millions)

U.S. Dollars(Thousands)

2001
Deferred tax assets:
Reserve for employee’s bonuses
Provision for enterprises tax
Retirement and severance benefit of directors and statutory auditors
Depreciation
Fix assets - intercompany profits
Inventory - intercompany profits
OthersGross deferred tax assets
Deferred tax liabilities:
Allowance for doubtful receivables - intercompany losses
Reserve for special depreciation
OthersGross deferred tax liabilities

¥

246
134
270
370
96
40
469
1,625

2000

2001

192
204
212
404
111
66
146
1,335

$ 1,986
1,082
2,179
2,986
775
323
3,785
13,116

(35)
(28)
(38)
(101)
¥ 1,234

(97)
(89)
(436)
(622)
$ 12,494

2001
42.0%

2000
42.0%

0.8%
(1.1%)–(2.6%)(3.6%)
35.5%

1.2%(1.5%)
23.3%–(0.9%)
64.1%

¥

(12)
(11)
(54)
(77)
¥ 1,548

Reconciliation of the differences between the statutory tax rate and effective income tax is as follows:

Statutory tax rate
Increase (reduction) in taxes resulting from:
Non-deductible entertainment expenses
Non- taxable dividend income
Current operating losses of subsidiaries
Difference in normal tax rates of subsidiaries
Others
Effective income tax rate
Net deferred tax assets are included in the consolidated balance sheets as follows:
Yen(Millions)

Current assets - Deferred income taxes
Investments and other assets - Deferred income taxes
Current liabilities - other current liabilities
Long-term liabilities - other
Net deferred tax assets

2001
537
1,088
–
(77)
¥ 1,548
¥

2000
569
744
(35)
(44)
¥ 1,234¥

U.S. Dollars(Thousands)

2001$4,334
8,781
–
(621)
$ 12,494

CMK CORPORATION 2001 Annual Report 17

10. Leased assets
Under Japanese accounting standards for leases, finance leases
that do not transfer ownership of the leased assets to thelessees are permitted to be accounted for as rental transactions
if certain “as if capitalized” information is disclosed in notes tolessee’s financial statements. For the years ended March 31,

2001, 2000 and 1999, the Company and its domestic subsidiaries made payments of ¥818 million ($6,602 thousand),¥810 million and ¥588 million, respectively, on these financeleases.

Yen(Millions)

2001

U.S. Dollars(Thousands)

2000

2001

Class of property (inclusive of interest)
Machinery and equipment
Others
Accumulated depreciation¥ 4,306¥ 3,741809
684(3,297)(2,524)¥ 1,818¥ 1,901
Depreciation expenses are computed using straight-line method over lease terms assuming no residual value.

$ 34,754
6,529(26,610)$ 14,673

Future minimum lease payments, inclusive of interest, as of March 31, 2001 and 2000 are:
Yen
(Millions)Year ending March 31

2002
2003 and the after
Total future minimum lease payment

2001
586
1,232
¥ 1,818¥

U.S. Dollars(Thousands)

2000
675
1,226
¥ 1,901
¥

2001
4,730
9,943
$ 14,673$

11. Derivative financial instruments
Foreign exchange forward contracts are used to hedge the riskof changes in foreign currency exchange rates substantiallyassociated with accounts receivable denominated in foreign
currencies. As foreign exchange forward contracts are utilized
for hedging purposes, such resulting gains or losses are effectively offset against foreign exchange gains or losses on theunderlying hedged assets by recognizing them in the same

period. The purpose of the Company’s foreign currency hedging activities is to protect the Company from the risk thateventual Yen net cash inflows resulting from the sale of products to foreign customers will be adversely affected by changes
in exchange rates. The contracted amounts outstanding at
March 31, 2001 and 2000 are shown below.

Yen(Millions)2001
Forward exchange contracts:
To sell foreign currencies
To buy foreign currencies¥¥

18 CMK CORPORATION 2001 Annual Report

U.S. Dollars(Thousands)

2000
6
–
6

¥
¥

2001
1
3
4

$
$

48
–
48

12. Pension and severance plans
The Company and its domestic subsidiaries have various defined benefit pension plans and severance indemnity plans.

Reserve for pension and severance costs at March 31, 2001

Benefit obligation
Plan assets
Funded status
Unrecognized actuarial loss
Net amount recognizedPrepaid benefit costReserve for pension and severance costs

Yen(Millions)

U.S. Dollars(Thousands)

2001¥ (3,139)
2,941
(198)
144
(54)
61
¥ (115)2001$ (25,335)
23,737(1,598)
1,162
(436)
492
$
(928)

Yen
(Millions)

U.S. Dollars(Thousands)

2001
330
91
(80)
19
¥ 360

Detail of net periodic benefit cost at March 31, 2001

Service cost
Interest cost
Expected return on plan assets
Amortization of net transition obligation
Net periodic benefit cost

¥

2001
2,663
735
(646)
153
$ 2,905
$

2001
3.5%
3.0%

Assumptions used at March 31, 2001

Discount rate
Expected return on plan assets

13. Contingent liabilities
Contingent liabilities at March 31, 2001 and 2000 are as follows:
Yen(Millions)

Notes receivable discounted with banks
Endorsed notes

The Company and its consolidated subsidiaries are contingently liable as guarantor of bank loans to non-consolidated

2001
¥ 374
3,348
¥ 3,722

2000
¥ 112
2,802
¥ 2,914

U.S. Dollars(Thousands)

2001$ 3,019
27,022$ 30,041

subsidiaries in the amounts of ¥272 million ($2,195 thousand)and ¥545 million at March 31, 2001 and 2000, respectively.

CMK CORPORATION 2001 Annual Report 19

14. Segment information
The following segment information has been prepared according to a Ministerial Ordinance under the Securities andExchange Law of Japan.

The printed wiring board sector, for each of the years in thethree-year period ended March 31, 2001, is more than 90%.

Geographic areas:
Yen(Millions)

U.S.Dollars(Thousands)

Year ended March 31

Year ended March 31

2001

2000

1999

2001

¥101,788
2,920
104,708¥103,146
3,303
106,449¥ 91,671
2,401
94,072$ 821,533
23,567845,100¥ 18,764
558
19,322¥ 16,160
303
16,463¥ 17,353
618
17,971$ 151,445
4,504
155,949

¥

1,741
20
1,761
(3,498)¥122,293

¥

1,940
–
1,940
(3,606)¥121,246

¥

4,425
12
4,437
(3,032)¥113,448

$

¥

9,111
1,287
(182)
(932)
¥ 9,284

¥

5,193
605
(105)
(748)
¥ 4,945

¥

997
1,659
(752)
(1,009)¥895$

Identifiable assets:
Japan
Asia
EuropeCorporate and elimination
Consolidated¥115,709
17,465
2,057
9,518¥144,749¥129,735
15,303
2,899
4,150¥152,087¥129,857
18,373
4,930
6,742¥159,902$ 933,890
140,961
16,602
76,820$1,168,273

Export sales:
To Asia
To Europe
To Others
Total¥20,193
1,783
1,509¥ 23,485¥17,153
2,452
1,201¥ 20,806¥19,895
4,888
1,123¥ 25,906$ 162,97814,391
12,179$ 189,548

Sales and operating revenue:
Japan
Customers
Intersegment
Total
Asia
Customers
Intersegment
Total
EuropeCustomers
Intersegment
Total
Ellimination
Consolidated
Operating income:
Japan
Asia
EuropeCorporate and elimination
Consolidated

General corporate expenses of ¥1,366 million ($11,025 thousand), ¥1,134 million and ¥1,061 million in 2001, 2000 and
1999, respectively, are included in “Corporate and elimination”.

20 CMK CORPORATION 2001 Annual Report

14,052
161
14,213(28,232)$ 987,030$

73,535
10,387(1,469)(7,522)74,931

Corporate assets of ¥17,679 million ($142,688 thousand),¥11,804 million and ¥13,536 million in 2001, 2000 and 1999,
respectively, which mainly consists of investment securities andcorporate properties, are included in “Corporate and elimination”.

Independent Auditors’ Report
CMK CORPORATION and Consolidated Subsidiaries

To the Board of Directors of
CMK CORPORATION

We have audited the accompanying consolidated balance sheets of CMK CORPORATION and subsidiaries asof March 31, 2001 and 2000, and the related consolidated statements of income, shareholders’ equity and cash
flows for each of the years in the three-year period ended March 31, 2001, all expressed in Yen. These
consolidated financial statements are the responsibility of the Company’s management. Our responsibility is toexpress an opinion on these consolidated financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing standards. Those standards require thatwe plan and perform the audit to obtain reasonable assurance about whether the financial statements are free ofmaterial misstatement. An audit includes examining, on a test basis, evidence supporting the amounts anddisclosures in the financial statements. An audit also includes assessing the accounting principles used andsignificant estimates made by management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, thefinancial position of CMK CORPORATION and subsidiaries as of March 31, 2001 and 2000, and the results of
their operations and their cash flows for each of the years in the three-year period ended March 31, 2001, inconformity with accounting principles generally accepted in Japan.
As explained in Notes 1 (d), 1 (i) and 1 (k), in the year ended March 31, 2001, the Company and subsidiaries
prospectively adopted new Japanese accounting standards for marketable and investment securities, retirement
and pension plans and foreign currency translation.
The accompanying consolidated financial statements as of and for the year ended March 31, 2001 have beentranslated into U.S. Dollars solely for the convenience of the reader. We have reviewed the translation and, in
our opinion, the consolidated financial statements expressed in Yen have been translated into U.S. Dollars on thebasis set forth in Note 2 to consolidated financial statements.
Tokyo, Japan
June 28, 2001

CMK CORPORATION 2001 Annual Report 21

Group Companies(As of March 31, 2001)

Company Name

Equity heldby the Company (%)

Principal BusinessSubsidiaries
CMK MECHANICS CORPORATIONCMK HI-TECHS CORPORATIONCMK DRILLING CORPORATIONCMK MULTI CORPORATIONCMK CIRCUIT TECHNOLOGY CENTER CORPORATIONSE PRODUCTS CORPORATIONCMK NIIGATA CORPORATIONCMK FINANCE CORPORATIONYAMANASHI SANKOH CORPORATIONCMK EUROPE N. V.
CMK KANBARA ELECTRONIC CORPORATION JAPANJT CMK CORPORATIONISHIZUKA MFG. CO., LTD.
WAKOH ELECTRONICS CORPORATIONCMK SINGAPORE (PTE.) LTD.
CMKS (MALAYSIA) SDN. BHD.
P. T. CMKS INDONESIACMKS (HONG KONG) CO., LIMITED

100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
90.0
80.0
75.5
66.6
54.2
52.6
51.0
64.1 (26.8)
100.0 (100.0)
100.0 (100.0)

Manufacturing and sales of PWBs and molds
Manufacturing and sales of PWBs
Manufacturing and sales of PWBs
Manufacturing and sales of PWBs
Designing circuit of PWBs
Manufacturing and sales of PWBs
Manufacturing and sales of PWBs
Credit and loan to subsidiaries
Manufacturing and sales of PWBs
Manufacturing and sales of PWBs
Manufacturing and sales of PWBs
Manufacturing and sales of PWBs
Manufacturing and sales of PWBs
Manufacturing and sales of PWBs
Manufacturing and sales of PWBs
Manufacturing and sales of PWBs
Manufacturing and sales of PWBs
Sales of PWBs

Affiliate
SNC INDUSTRIAL LAMINATES SDN. BHD.

49.0

Manufacturing and sales of copper-clad laminates

Note: Equity held by the Company equals the total of direct and indirect holdings. Figures in parentheses are indirect holdings.

22 CMK CORPORATION 2001 Annual ReportProfile

CMK is keeping pace with the demand on printed wiringboards (PWBs) for compactness and greater functionality in products such as mobile phones. As a major concern in the field of PWBs, CMK pursues tightly focusedtechnological research and development. And as a leading manufacturer of PWBs, CMK has built up a strong
base of operations. CMK products are appreciated bycustomers all over the world. CMK challenges for continuous success in an increasingly competitive market.
At the same time, CMK pays attention to environmental
issues.

CMK—Invisible, but everywhere.
Audio-Visual

Directors andCorporate Statutory Auditors

Our single-sided, double-sided, silver through-hole PWBs andmore are used in CD players, MD players, VCRs and DVD players.

Chairman

Mobile Communications

Noboru Nakayama(As of March 31, 2001)(As of June 28, 2001)

We provide primarily multi-layered IVH and ALIVH boards(4~10 layers) for products such as mobile phones, PDA, etc.
®

Information Devices
Our 4 ~12 layered through-hole PWBs, 4~10 layered IVH PWBs
and Rigid-Flex (RF) build-up PWBs (RF-1, RF-3) can be found ina range of PCs and peripheral devices.

President
Eiji Watanabe
Vice President
Kameharu Seki
Senior Managing Director

Displays

Norimasa Sato

We produce double-sided PWBs, 4~12 layered through-hole
PWBs, 4~10 layered IVH PWBs for LCDs, PDP displays andmore.

Managing Directors

Substrates for Semiconductor Packages(Rigid type, tape type)

Takahiro Nakayama

EstablishedFebruary 1961
Capital¥16.1 1 billion
Employees
6,180 (CMK Group)
Business Activities
Research and Development, production and sales of PWBs andelectronic devices.
Major Shareholders
Number ofshares held(Thousands)

Kuniaki Kanemoto

Shareholders

Shigeyuki Seki

Nippon Trustee Service Bank, Ltd. (Trustee account)
Noboru Nakayama
The Dai-ichi Mutual Life Insurance Company
The Industrial Bank of Japan, Limited
Sumitomo Bakelite Co., Ltd.
Matsushita Electric Works, Ltd.
The Tokyo Trust and Banking Corporation /The Nippon Trust and Banking Corporation /Retirement Benefit for Hitachi Chemical Co., Ltd.
Naohiko Seki
The Sakura Bank, Limited
The Tokyo Tomin Bank, Limited

Susumu Yasuma

Our PWBs accommodate main components such as CPUs, DSPs,
DRAM, SRAM, flash memory and more.

Directors

Car Electronics

Masakazu Takemoto

Our PWBs are installed in automotive electronic equipment likeengine control systems, ABS, SRS air bags, instrument panels, carnavigation systems, etc.

Takeo Takai
Kunio Nishi
Mamoru Manaka
Corporate Statutory Auditors
Hirofumi Shinjobo
Takashi Watanabe
Hideaki Takahashi
Mitsuo Honjo

CONTENTS
01 Financial Highlights
02 Message from the Management
03 Mid-Term Business Strategy
07 Financial Section
22 Group Companies
23 Directors and Corporate Statutory Auditors
23 Corporate Data

Corporate Data

Percentage
(%)

4,881
3,820
2,345
2,258
1,896
1,860

9.17
7.17
4.40
4.24
3.56
3.49

1,822
1,631
1,549
1,545

3.42
3.06
2.91
2.90

Correspondent BanksThe Industrial Bank of Japan, Limited
The Sakura Bank, Limited
The Sumitomo Bank, Limited
The Fuji Bank, Limited
The Daiwa Bank, Limited
The Tokyo Tomin Bank, Limited
Accounting Period
March 31Principal Clients
Matsushita Electric Industrial Co., Ltd.
Sony Corporation
Toshiba Corporation
Pioneer Corporation
Seiko Epson Corporation
Casio Computer Co., Ltd.

Cautionary Statement with Respect to Forward-Looking Statements
Statements made in this annual report with respect to CMK’s plans, strategies
and beliefs and other statements that are not historical facts are forward-looking
statements about the future performance of CMK, which are based on management’s assumptions and beliefs in light of the information currently available toit, and involve risks and uncertainties. Potential risks and uncertainties include,
without limitation, general economic conditions in CMK’s markets; industrial
market conditions; exchange rates in which CMK makes significant sales or inwhich CMK’s assets and liabilities are denominated; and CMK’s ability to continue to win acceptance of its products and services, which are offered in highly
competitive markets characterized by the continual introduction of new products, rapid developments in technology, and changing customer preferences.

CMK CORPORATION 2001 Annual Report 23

CMK CORPORATION

2001 Annual Report

Year ended March 31, 2001

CMK CORPORATION
43F Shinjuku I-LAND TOWER Bldg.
6-5-1, Nishishinjuku, Shinjuku-ku, Tokyo 163-1388, Japan
Tel: +81-3-5323-0231
http://www.cmk-corp.com

Printed in Japan on recycled paper