Fuji Electric Report
Financials

Consolidated Financial Highlights
Thousands of
U.S. dollars*1

Millions of yen

Years ended March 31

2015

2016

2017

2018

2019

2019

Operating Results
Net sales
Japan
Overseas
Operating income
Net income attributable to owners of parent¥810,678
605,763
204,915
39,31627,978¥813,550
597,757
215,793
45,00630,644¥837,765
632,723
205,042
44,70940,978¥893,451
674,744
218,707
55,962
37,763¥914,915
682,503
232,41259,97240,267$8,317,414
6,204,573
2,112,841
545,203
366,073

R&D and Capital Investment
R&D expenditures
Plant and equipment investment*2
Depreciation and amortization*3¥ 35,023
29,041
33,615¥ 35,949
27,65029,723¥ 34,910
27,14929,445¥ 35,620
26,46530,151¥ 33,669
43,33830,906$  306,087
393,985
280,965

Cash Flows
Cash flows from operating activities
Cash flows from investing activities
Free cash flow
Cash flows from financing activities¥ 51,459(22,750)
28,708(33,827)¥ 48,450(19,410)29,040(31,567)¥ 58,185
9,748
67,934(56,082)¥ 53,146(14,550)
38,596(46,887)¥ 54,949(21,448)
33,501(38,172)$  499,544(194,985)
304,559(347,037)

Financial Position
Total assets*4
Total net assets
Shareholders’ equity
Net interest-bearing debt
Interest-bearing debt

¥904,522
319,636
290,339
194,579
226,474¥845,378
260,980
230,399
189,374
220,213¥886,663
323,863291,216
141,578
183,465¥914,744
366,546
330,636
130,177
163,507¥952,659
392,061
352,922
124,850
153,985$8,660,545
3,564,195
3,208,381
1,135,008
1,399,870

4.8
10.8
3.3
32.1
0.7
0.8

5.5
11.8
3.5
27.3
0.8
1.0

5.3
15.7
4.7
32.8
0.5
0.6

6.3
12.1
4.2
36.1
0.4
0.5

6.6
11.8
4.3
37.0
0.4
0.4

—
—
—
—
—
—

Per Share Data*7
Net income
Net assets
Cash dividends¥ 39.16406.399.00¥ 42.90322.5210.00¥ 57.36407.6811.0¥  264.34
2,314.50
14.00¥  281.89
2,470.65
48.00$ 2.563
22.4600.727

OthersEmployees
Japan
Overseas

25,74017,814
7,926

26,503
17,716
8,787

27,00917,7049,305

27,416
17,647
9,769

—
—
—

Financial Indicators
Ratio of operating income to net sales (%)
ROE (Return on equity) (%)
ROA (Return on assets) (%)*4
Equity ratio (%)*4
Net debt-equity ratio (times)*5
Debt-equity ratio (times)*6

Yen

U.S. dollars*1

Headcount

26,50817,635
8,873*1 The U.S. dollar amounts represent the arithmetic results of translating yen into dollars at ¥110 = U.S. $1, the approximate exchange rate at March 31, 2019.
*2 Plant and equipment investment is the total of investment in tangible fixed assets, including acquisition amounts for lease contracts.
*3 Depreciation and amortization expense is the total of the depreciation of tangible fixed assets and amortization of intangible assets.
*4	Effective April 1, 2018, the Company have adopted “Partial Amendments to Accounting Standard for Tax Effect Accounting” (ASBJ Statement No. 28, revised on February 16, 2018).
As such, major management indicators in consolidated accounting period as of March 31, 2018 have been adjusted to retroactively apply said accounting standards.
*5 Net debt-equity ratio is the ratio of net interest-bearing debt (interest-bearing debt + lease obligations – cash and cash equivalents) to shareholders' equity.
*6 Debt-equity ratio is the ratio of interest-bearing debt to shareholders' equity.
*7 Effective October 1, 2018, the Company conducted an 1-for-5 common stock consolidation.
Amounts for net income per share and net assets per share have been calculated assuming that the stock consolidation took place on April 1, 2017.
	The amount of dividend ¥48 per share for the year ended March 31, 2019 is total of the interim dividend of ¥8 per share and the year-end dividend of ¥40 per share.
	Since the Company conducted an 1-for-5 common stock consolidation effective October 1, 2018, the interim dividend of ¥8 does not reflect stock consolidation effect and the annual
dividend of ¥40 reflects stock consolidation effect. If the stock consolidation effect is also considered to the interim dividend per share, the interim dividend of ¥8 per share without theeffect is equivalent to ¥40 per share with the stock consolidation effect. Accordingly, the annual dividend for fiscal 2018 amounted to ¥80 per share, including adjusted interim dividendof ¥40 per share and year-end dividend ¥40 per share.

Contents
Consolidated Financial Highlights.................................................... 01
Management’s Discussion and Analysis.......................................... 02
Consolidated Balance Sheets.......................................................... 09
Consolidated Statements of Income................................................ 11
Consolidated Statements of Comprehensive Income....................... 12
Consolidated Statements of Changes in Net Assets........................ 13
Consolidated Statements of Cash Flows......................................... 14
Notes to the Consolidated Financial Statements.............................. 15
Independent Auditor’s Report.......................................................... 38

01 Fuji Electric Report Financials 2019

Management’s Discussion and Analysis
Cost of Sales, Selling, General and Administrative
Expenses and Operating Income
The cost of sales increased by 2.7% year on year, to ¥679,877
million, and the ratio of cost of sales to net sales increased by
0.2 percentage point, to 74.3%.
Selling, general and administrative expenses decreased by
0.3% year on year, to ¥175,066 million. The ratio of selling,
general and administrative expenses to net sales decreased
by 0.6 percentage point, to 19.1%.
Operating income increased by ¥4,010 million year on
year, to a record high of ¥59,972 million, due to higher net
sales and production volumes as well as the benefits of cost
reductions. The operating margin increased by 0.3 percentage
point, to 6.6% year on year.

Overview
During fiscal 2018, the year ended March 31, 2019, theoverseas operating environment for Fuji Electric saw a trend
toward investment restraint in the Chinese market in thesecond half of the fiscal year due to factors including the trade
friction between the United States and China.
In Japan, despite a sense of slowing down in some sectors,
there was firm demand resulted from increases in the replacement of aged equipment and investments in automation, laborsaving, and energy saving for production facilities aimed at
improving productivity.
In this environment, we sought to complete the measures
put forth in the FY2018 Medium-Term Management Plan,
Renovation 2018, which concluded with the fiscal year ended
March 31, 2019. In addition to strengthening the powerelectronics systems business and promoting proactive investments with a view to expanding the power semiconductorbusiness, we further enhanced manufacturing capabilities, andpursued improved profitability by reenergizing the Companywide
Pro-7 Activities designed to enhance business quality.

Non-Operating Income (Expenses) and Ordinary Income
Non-operating income (net) was ¥3,507 million, a ¥3,422 million
increase from ¥85 million in the previous fiscal year. This increase
was mainly due to a ¥2,169 million increase in foreign exchange
gains (losses), a ¥610 million increase in dividends income anda ¥446 million increase in equity in earnings of affiliates.
As a result, ordinary income grew ¥7,432 million year on
year, reaching a new record high of ¥63,479 million.

Financial Performance
Net Sales
Net sales in fiscal 2018 increased by 2.4% year on year, to¥914,915 million, as a result of strong demand.
In the Power Electronics Systems—Energy Solutions,Power Electronics Systems—Industry Solutions, Power and
New Energy and Electronic Devices segments, sales increased
year on year. However, sales in Food and Beverage Distribution
segment decreased year on year. Domestic sales increased by
1.1%, to ¥682,503 million. Overseas sales increased by 6.3%,
to ¥232,412 million.
The ratio of overseas sales increased by 0.9 percentage
point, to 25.4% year on year.

Net Sales /Ratio of Overseas Sales to Net Sales(Billions of yen)

893.5
810.7 813.6
750.0

26.5

914.9

40

(Billions of yen)
70.0

6.3

60.0

24.5

25.4

30

5.5

5.3

6.6

7

50.0

45.0

(%)

4.9

50.0

60.0

56.0

6
40.0

41.0

3.8

4.4

5

40.3
37.8

4

3.5

5

44.7

30.6

39.3

500.0

(Billions of yen)

4.2

4.8

25.3
40.0

4

30.0

3

20.0

2

10.0

1

30.0

28.0

3

20

250.0

0

(%)

837.8

24.5

Net Income Attributable to Owners of
Parent / Ratio of Net Income Attributableto Owners of Parent to Net Sales

Operating Income / Ratio of
Operating Income to Net Sales(%)

1,000.0

Extraordinary Income (Loss), Income before Income Taxes
and Non-Controlling Interests
Extraordinary income totaled ¥2,451 million and included again on sales of noncurrent assets, a gain on sales of investment securities and foreign currency translation adjustments
reversal gains. This represented a ¥551 million year-on-yearincrease due to an increase in foreign currency translation
adjustments reversal gains,which were offset by a reduction ingain on sales of investment securities.
Extraordinary loss totaled ¥3,643 million and included aloss on disposal of noncurrent assets, a loss on devaluation of
investment securities and the impairment loss. This represented
a ¥2,501 million year-on-year increase primarily due to theimpairment loss recorded in this fiscal year.

10

15/3

16/3

17/3

18/3

19/3

Net Sales (left)
Ratio of Overseas Sales to Net Sales (right)

0

0

15/3

16/3

17/3

18/3

19/3

Operating Income (left)
Ratio of Operating Income to Net Sales (right)

0

20.0

2

10.0

1

0

15/3

16/3

17/3

18/3

19/3

0

Net Income Attributable to Owners of Parent (left)
Ratio of Net Income Attributable to Owners of
Parent to Net Sales (right)

Fuji Electric Report Financials 201902

Net Income
Income before income taxes increased by ¥5,482 million year
on year, to ¥66,287 million. After subtracting ¥17,217 million inincome taxes (the net of income taxes-current and income
taxes-deferred) and ¥4,803 million in net income attributable
to non-controlling interests, net income attributable to ownersof parent increased by ¥2,504 million from the previous fiscal
year, to ¥40,267 million.

Results by Business Segment
Power Electronics Systems—Energy Solutions
Net sales: ¥224,787 million (an increase of 3.3% year on year)
Operating income: ¥16,854 million (an increase of ¥2,839
million year on year)
Net sales and operating income increased year on year.
Solid performance in the facility / power source systembusiness and the ED&C components business supported.
• In the energy management business, net sales decreased
year on year primarily due to the impact of large-scale orders
from overseas in the previous year and weak demand forsmart meter. However, operating income increased year on
year due to the benefits of cost reduction efforts.
• In the facility / power source system business, net sales andoperating income increased year on year due to increases inlarge-scale orders in Japan.
• In the ED&C components business, net sales and operating
income increased year on year as a result of strong demand
from power distribution manufacturers.
Orders received in fiscal 2018 (Power Electronics
Systems—Energy Solutions segment of Fuji Electric Co., Ltd.,
non-consolidated-basis) totaled ¥141.4 billion.

Power Electronics Systems—Industry Solutions
Net sales: ¥321,942 million (an increase of 0.3% year on year)
Operating income: ¥19,393 million (an increase of ¥473 million
year on year)
Net sales and operating income increased year on year.
Performance was driven by the factory automation business,the equipment construction business and the IT solutions
business.
• In the factory automation business, net sales and operating
income increased year on year as a result of strong demandmainly for inverters, motors and FA System in Japan partially
offset by weak overseas business result in the second half.
• In the process automation business, net sales and operating
income decreased year on year due to the impact of largescale orders in the previous year.
• In the social solutions business, net sales and operating
income decreased year on year primarily due to weak
demand for electrical equipment for railcars.
• In the equipment construction business, net sales andoperating income increased year on year due to increases inorders from the electricity equipment construction including
the plant power distribution equipment.
• In the IT solutions business, net sales and operating income
increased year on year due to increases in orders from theacademic sector and the public sector.
Orders received in fiscal 2018 (Power Electronics
Systems—Industry Solutions segment of Fuji Electric Co., Ltd.,
non-consolidated-basis) totaled ¥154.1 billion.

Net Sales by Segment

Operating Income (Loss) by Segment(Billions of yen)(Billions of yen)

1,000.0

893.5

914.9

60.4

62.2

Others

117.8

113.6

Food and Beverage Distribution

126.9

137.3

Electronic Devices

96.9

107.0

Power and New Energy

800.0

600.0

70.0

56.0

60.0

50.0

321.9

321.0

Power Electronics Systems-Industry
Solutions

2.9
6.2

2.8
5.8

Others

15.6

Electronic Devices

4.8

Power and New Energy

19.4

Power Electronics Systems-Industry
Solutions

Food and Beverage Distribution

13.7

40.0

400.0

60.0

5.5

30.0

18.9
20.0

200.0

0

–200.0

18/3

217.6

224.8

– 47.1– 52.019/3

03 Fuji Electric Report Financials 2019

Power Electronics Systems-Energy
Solutions

10.0

14.0

16.9

Power Electronics Systems-Energy
Solutions

0

–5.3

–5.2

Elimination and Corporate

Elimination and Corporate

–10.0

18/3

19/3

• In the store distribution business, net sales and operating
income decreased year on year due to weak demand forstore equipment for use in convenience stores.
Orders received in fiscal 2018 (Food and Beverage
Distribution segment of Fuji Electric Co., Ltd., nonconsolidated-basis) totaled ¥101.8 billion.

Power and New Energy
Net sales: ¥107,012 million (an increase of 10.5% year on year)
Operating income: ¥4,750 million (a decrease of ¥771 million
year on year)• In the power generation business, net sales increased year
on year due to increases in orders from the solar power
generation systems. However, operating income decreased
year on year as a result of cost increases in large-scaleorders.
Orders received in fiscal 2018 (Power and New Energy
segment of Fuji Electric Co., Ltd., non-consolidated-basis)
totaled ¥80.0 billion.

Others
Net sales: ¥62,231 million (an increase of 3.0% year on year)
Operating income: ¥2,766 million (a decrease of ¥95 million
year on year)

R&D Investment and Plant andEquipment Investment

Electronic Devices
Net sales: ¥137,334 million (an increase of 8.2% year on year)
Operating income: ¥15,623 million (an increase of ¥1,924
million year on year)• In the electronic devices business, net sales and operating
income increased year on year as a result of strong demand
from the automotive field and the magnetic disks partially
offset by weak demand for power semiconductors in Japan
from the industrial field in the second half.
Orders received in fiscal 2018 (Electronic Devices segmentof Fuji Electric Co., Ltd., non-consolidated-basis) totaled¥91.4 billion.

R&D
Fuji Electric focused on research and development activities
for creating competitive components and systems centered on
power electronics technologies and, power semiconductor
technologies, and activities for developing solutions that produce
value for customers by combining fundamental technologies.
The Company has re-organized its R&D structure to accelerate R&D activities. Product development functions aredelegated to the respective business groups. The corporate
R&D group is responsible for technology marketing, advanced
research, and basic research.
The Company’s R&D expenditures in fiscal 2018 totaled¥33,669 million.
As of March 31, 2019, the number of industrial property
rights which were registered in Japan and overseas and held
by Fuji Electric stood at 12,574.

Food and Beverage Distribution
Net sales: ¥113,606 million (a decrease of 3.5% year on year)
Operating income: ¥5,756 million (a decrease of ¥478 million
year on year)• In the vending machine business, net sales and operating
income increased year on year primarily due to strong
demand from customers in the Japanese market.

R&D Expenditures / Ratio of R&D
Expenditures to Net Sales(Billions of yen)
40.0

35.0

(%)

35.9

8

34.9

35.6

Plant and Equipment Investment /Depreciation and Amortization

Total Net Assets / ROE(Billions of yen)(Billions of yen)

50.0

(%)

392.1

400.0

366.5

43.3

33.7

40

323.9

319.6
40.0

30.0

6

4.3

4.4

4.2

4.0

20.0

30.0

3.7

300.0

33.6
29.0

30.2

29.7 29.4
27.7 27.1
26.5

4

30

261.0

30.9

200.0

20

15.7
20.0

10.8
10.0

2

12.1

11.8

11.8

100.0

10

10.0

0

15/3

16/3

17/3

18/3

19/3

R&D Expenditures (left)
Ratio of R&D Expenditures to Net Sales (right)

0

0

15/3

16/3

17/3

Plant and Equipment Investment
Depreciation and Amortization

18/3

19/3

0

15/3

16/3

17/3

18/3

19/3

0

Total Net Assets (left)
ROE (right)

Fuji Electric Report Financials 201904

Plant and Equipment Investment
Plant and equipment investment, including leases, amounted
to ¥43.3 billion in fiscal 2018. These expenditures wereprimarily directed toward electronic devices and powerelectronics and included new semiconductor product startups
and production capacity expansions for automotive applications,as well as increasing sales of systems products and automationof production lines.
Major investments were as follows.
The Electronic Devices segment conducted large-scale
investments in front-end processes to increase production
capacity of power semiconductor chips mainly for automotive
applications at the Yamanashi Factory.
In back-end processes, capital expenditures for production
equipment to increase production of intelligent power modules(semiconductors element used in power generation) wereconducted at domestic and overseas bases, and investment
in launching the production line for new automotive products
was carried out at factories in Japan.
In the Power Electronics Systems—Energy Solutions
segment, investments were conducted in earthquake countermeasures at the Chiba Factory, and in beginning constructionof a factory in Thailand for the purpose of bolstering sales ofsystem products.
The Power Electronics Systems—Industry Solutions
segment conducted capital expenditures for expanding
mass-production of printed boards in Thailand. Meanwhile,
we made capital expenditures at the Suzuka Factory with theaim of reducing the cost of rotary machine models.
In the Food and Beverage Distribution segment,
investments were conducted in new servo presses to reducethe cost of vending machine models.

Total Assets / ROA(Billions of yen)
1,000.0

(%)

904.5
845.4

886.7

914.7

952.7

10

Total Assets
Total assets on March 31, 2019, stood at ¥952,659 million,
an increase of ¥37,915 million from the end of the previous
fiscal year.
Current Assets and Current Liabilities
Total current assets increased ¥54,625 million from theprevious fiscal year-end, to ¥573,096 million. This increase ismainly due to increases of ¥27,215 million in inventories and¥21,747 million in trade receivables.
Total current liabilities stood at ¥425,894 million on March
31, 2019, an increase of ¥21,153 million year on year. This
increase is mainly because the decrease of ¥2,490 million in
short-term debt partially offset by increases of ¥12,693 million
in trade payables, ¥4,921 million in current portion of long-term
debt, and ¥2,599 million in income taxes payable.
Noncurrent Assets
Total noncurrent assets decreased by ¥16,710 million year on
year, to ¥379,563 million on March 31, 2019. Net property,
plant and equipment were ¥182,124 million, an increase of¥7,524 million year on year. Total investments and other assets
amounted to ¥197,439 million, a decrease of ¥24,234 million
year on year. This decrease is mainly due to a ¥23,727 million
decrease in net defined benefit asset.
Long-term Liabilities
Total long-term liabilities decreased by ¥8,753 million from theprevious fiscal year-end, to ¥134,704 million. Net defined benefit
liability and lease obligations increased by ¥3,275 million and¥2,095 million, respectively, but these increases were partially
offset by a ¥13,887 million decrease in long-term debt.

Equity Ratio

Interest-bearing Debt /Debt-equity Ratio(%)(Billions of yen)
40.0

36.1

37.0

(Times)

300.0

3

32.8

32.1

800.0

Financial Position

226.5

8

220.2

30.0

27.3
600.0

4.7
400.0

183.5

200.0

3.3

4.2

4.3

3.5

1.0
100.0

1

0.6

0.8

10.0

0

0.5

2

15/3

16/3

17/3

18/3

Total Assets (left)
ROA (right)

05 Fuji Electric Report Financials 2019

19/3

154.0

20.0
4

200.0

2

163.5

6

0

0

15/3

16/3

17/3

18/3

19/3

0

15/3

16/3

17/3

Interest-bearing Debt (left)
Debt-equity Ratio (right)

18/3

0.4

19/3

0

Net Assets
Net assets as of March 31, 2019, totaled ¥392,061 million, an
increase of ¥25,515 million from the previous fiscal year-end.
This increase was mainly attributable to an increase of¥28,423 million in retained earnings.
As a result, the equity ratio stood at 37.0%, an increase of
0.9 percentage points year on year.

Cash Flows from Investing Activities
Net cash used in investing activities was ¥21,448 million,
compared with net cash used in investing activities of ¥14,550
million, in the previous fiscal year. This was primarily a result of
the purchase of property, plant and equipment.
Net cash used in investing activities increased by ¥6,898
million year on year.

Debt
Interest-bearing debt as of the fiscal year-end totaled¥153,985 million, a decrease of ¥9,522 million year on year.
The ratio of interest-bearing debt to total assets was 16.2%,
representing a 1.7 percentage-point decrease from theprevious fiscal year-end.

Cash Flows from Financing Activities
Net cash used in financing activities was ¥38,172 million,
compared with ¥46,887 million in the previous fiscal year.
This was principally due to the redemption of bonds and therepayment of lease obligations.
Net cash used in financing activities decreased by¥8,715 million year on year.

Cash Flow
Consolidated free cash flow (net cash provided by (used in)operating activities + net cash provided by (used in) investing
activities) was a positive ¥33,501 million, a ¥5,095 million
decrease from the previous fiscal year’s positive free cash flowof ¥38,596 million.
Cash Flows from Operating Activities
Net cash provided by operating activities was ¥54,949 million,
compared with ¥53,146 million in the previous fiscal year.
Major factors of cash increase included income before income
taxes and an increase in trade payables.
Major factors of cash decrease included an increase ininventories and an increase in trade receivables. Cash flows fromoperating activities increased by ¥1,803 million year on year.

Cash Flows

Free Cash Flow /Cash and Cash Equivalents(Billions of yen)(Billions of yen)

80.0

80.0

60.0 51.5

58.2
48.5

53.1

54.9
60.0

40.0

20.0

9.7

0

40.0

– 20.0 –22.8

–14.6

–19.4

–21.4

–33.8 –31.6–38.2– 40.0

–46.9

41.9
38.6
33.3 33.5

31.9 30.8
28.7 29.0

29.1

20.0

–56.1

– 60.0– 80.0

67.9

15/3

16/3

17/3

18/3

19/3

Cash Flows from Operating Activities
Cash Flows from (Used in) Investing Activities
Cash Flows from (Used in) Financing Activities

0

15/3

16/3

17/3

18/3

19/3

Free Cash Flow
Cash and Cash Equivalents

Fuji Electric Report Financials 201906

Risk Factors
Fuji Electric works to mitigate business risk and other risks in asystematic and methodical manner. However, there are various
risks, such as those listed below, which could have a negative
effect on the operating results and financial position of Fuji Electric.
As of March 31, 2019, the following factors were judged tohave a potential future effect on the operations of Fuji Electric.
(1) Risks Related to Changes in the Operating Environment(a)	In addition to increasing raw material and components
prices against the background of a weak yen, such changes
as the drastically increasing demand in emerging nations
may result in tightened supply and demand as regards
materials and raw materials. Consequently, although
Fuji Electric strives to lessen the risk of rising raw material
prices through commodity swap transactions, significant
increases in these prices could have a negative effect on
the operating results of Fuji Electric.
(b)	Fuji Electric is developing operations actively in overseas
markets, focusing particularly on expanding sales in China
and other Asian markets. In addition, economic trends inJapan, such as private sector capital investment and public
investment affect the Company significantly. In order tominimize the effect on operating results of overseas anddomestic market trends, the Company is implementing
overall cost and expense reductions. However, a deteriorationof the business climate or a change of economic policy inChina, a dramatic change in product supply and demandor intensified competition in the market, or a steep decreasein price levels as a result of such factors could affectFuji Electric’s operating results.
(c)	Based on an established set of management criteria,
Fuji Electric systematically employs forward-exchange
contracts to minimize the risk of exchange rate fluctuations
on its operating results. However, the forward-exchange
contract policy is not capable of entirely mitigatingexchange rate risk. Consequently, fluctuations in exchange
rates, primarily between the yen and the U.S. dollar, could
have a negative effect on the operating results and financial
position of the Company.
(d)	Fuji Electric’s interest-bearing debt totaled ¥153,985 million
as of March 31, 2019. A higher-than-anticipated increase
in interest rates could lead to a significant additional interest
payment burden, which could have a negative effect on
the operating results of the Company.
(e)	Trends in the financial markets or deterioration in Fuji Electric’s
financial indicators could impact on Fuji Electric’s fundprocurement or interest payments, for example by prompting
early repayment due to infringement on financial covenants
relating to certain loans. Such an event could affectFuji Electric’s operating results and financial position.

07 Fuji Electric Report Financials 2019(2) Risks Related to Product Quality
Fuji Electric has put in place a quality assurance systemdesigned to ensure the highest level of quality for all of the
products that it manufactures and sells. Although the Company
has taken precautions in the form of product liability insurance
to provide compensation for product liability claims, in theevent that major defects are found in any Fuji Electric products
due to unforeseen factors, there could be a negative effect on
the Company’s operating results and financial position.
(3) Risks Related to Investments
Fuji Electric concentrates its management resources on quickly
identifying potential business growth areas and conducts investment in facilities and R&D with the objective of expanding anddeveloping the Company’s business. The large-scale investment
necessary and short product cycles in the semiconductors andmagnetic disks fields, in particular, as well as shifts in productdemand and intensifying competition increase the possibility
that the Company might not be able to recoup its investments.
Such events could thereby have a negative effect on the
Company’s operating results.
(4) Risks Related to Technology Development
Fuji Electric makes a concerted effort to develop technologythat matches the needs of the market. However, there is apossibility that competing companies will gain an advantage
through faster development, or that the Company will be
unable to bring products to market in a timely manner should
development not progress according to plan. Such events
could thereby have a negative effect on the Company’s
operating results.
(5) Risks Related to Overseas Business Activities
Fuji Electric is seeking to expand its overseas presence, witha particular focus on Asia, including China. Consequently, theCompany is exposed to the following risks, which could havea negative effect on the Company’s operating results andfinancial position:-	Unforeseen changes in laws and regulations as well as tax
systems that could have a detrimental effect on the Company-	Disadvantages arising from political conditions-	Social turmoil related to terrorist incidents, war, andother events(6) Risks Related to Intellectual Property
Fuji Electric effectively manages its intellectual property rights
and develops new products and technologies in a manner that
does not infringe on third-party patent rights. However, since
the pace of technological innovation is accelerating and theCompany’s operations are becoming more global, the possibilityof disputes over intellectual property rights is increasing.
A dispute of this nature could have a negative effect on the
Company’s operating results and financial position.

(7) Risks Related to Business Alliances
Fuji Electric actively collaborates with third-party entities
in joint ventures, tie-ups, and other forms of alliances with theobjective of enhancing competitiveness in each of its fieldsof business. Cooperative relations are essential to the successof such collaborations.
However, differences in business systems, corporate cultures,or other aspects could impede the smooth integration ofbusiness strategies, technologies, products, personnel,
or other elements necessary for a successful collaboration.
Such circumstances could thereby have a negative effecton the Company’s operating results.
(8) Risks Related to Human Resources
The business activities of Fuji Electric depend heavily on its
human resources. Retaining and training superior personnel
in such fields as technology, production, sales, and administration is essential to the growth of the Company. Should theCompany be unable to retain and/or train such necessary
human resources, this could have a negative effect on the
Company’s operating results.
(9) Risks Related to the Leakage of Personal Information
As a part of its business activities, Fuji Electric handles personal
information about numerous individuals, including customers,
suppliers, and employees. Fuji Electric has formulated andstrictly enforces thorough internal regulations regarding thegathering, use, and management of personal information.
However, the Company cannot entirely rule out the possibility
that such information could be leaked due to unforeseen
circumstances. Any leak of this kind could damage trustin Fuji Electric and thereby have a negative effect on the
Company’s operating results.

(12) Risks Related to Retirement Benefit Liabilities
Fuji Electric has a lump-sum payment plan and a corporate
pension plan for its employees when they retire. Retirement
benefit costs and liabilities are calculated on the assumptionthat they are accepted as reasonable on the basis of actuarial
calculations. Fuji Electric and certain domestic consolidated
subsidiaries have also entrusted listed marketable securities
to employee retirement benefit trusts. Consequently, changes
in the discount rate, the expected rate of return on pension
assets and stock prices that are used as the basis of computing
pension benefit obligations, differences between these expectations and actual performance, changes in the prices of
entrusted listed marketable securities, and other items could
have a negative effect on the operating results and financial
position of Fuji Electric.
(13) Risks Related to ComplianceFuji Electric conducts business in a variety of fields andregions throughout the world, and as such is subject to thelaws and regulations of numerous countries. The Company
has put in place an appropriate internal control system toensure compliance, but the possibility of legal violations cannot
be discounted entirely. Should such a violation occur, this could
have a negative effect on the Company’s social credibility
and/or operating results.
(14) Risks Related to Lawsuits and Other Legal Proceedings
Fuji Electric, in the course of its business, could become thesubject of a lawsuit or other legal proceeding, and could asa result unexpectedly become liable for the payment of large
amounts of compensation. Depending on the content of sucha decision, this could have a negative effect on the Company’s
operating results.

(10) Risks Related to Major Natural Disasters
Fuji Electric has a network of bases throughout the world. In
the event of a major natural disaster, production facilities could
be damaged, operations at manufacturing facilities could be
halted, shipments of products could be delayed, and otherrelated problems could occur. These events could thereby
have a negative effect on the operating results and financial
position of the Company.
(11) Risks Related to Soil Contamination
Based on the international standard for environmental protection systems, the Company works to prevent, measure, andmonitor soil contamination at its operating sites. Prior to selling
any land, the Company carries out soil surveys and takesother appropriate steps in accordance with relevant laws andregulations. However, as a result of these measurements andsurveys, the Company may incur costs for soil remediation
measures, which could have a negative effect on the operating
results of the Company.

Fuji Electric Report Financials 201908

Consolidated Balance Sheets
As of March 31, 2019 and 2018

Millions of yen

Thousands of
U.S. dollars(Note 3)

2019

2018

2019

¥   29,134
169
308,831(2,084)
176,972
60,074573,096¥   33,329
42
287,084(1,280)149,757
49,539518,471$   264,862
1,545
2,807,558(18,949)
1,608,837
546,115
5,209,968

Less accumulated depreciation
Net Property, Plant and Equipment

35,032
243,822
212,587
76,2189,211
576,870(394,746)
182,124

34,947240,044
204,974
77,024
2,401
559,390(384,790)
174,600

318,475
2,216,570
1,932,613
692,894
83,727
5,244,279(3,588,604)
1,655,675

Investments and Other Assets:
Investment securities (Notes 5, 6 and 7):
Unconsolidated subsidiaries and affiliates
Other
Long-term loans receivable
Net defined benefit asset (Note 11)
Deferred tax assets (Note 17)
Other investments and other assets (Note 20)
Allowance for doubtful accounts
Total Investments and Other Assets
Total Assets

24,614
108,734
710
16,382
16,82530,658(484)
197,439¥ 952,659

23,898112,016
731
40,10915,911
29,494(486)
221,673¥ 914,744

223,766
988,494
6,461
148,934
152,963
278,688(4,404)
1,794,902$ 8,660,545

AssetsCurrent Assets:
Cash and cash equivalents (Note 6)
Short-term investments (Notes 5, 6 and 7)
Trade receivables (Note 6)
Allowance for doubtful accounts
Inventories (Note 4)
Other current assets
Total Current Assets

Property, Plant and Equipment (Note 5):Land
Buildings and structures
Machinery and equipment
Lease assets (Note 20)
Construction in progress

The accompanying Notes to the Consolidated Financial Statements are an integral part of these statements.

09 Fuji Electric Report Financials 2019

Thousands of
U.S. dollars(Note 3)

Millions of yen

Liabilities and Net Assets
Current Liabilities:
Short-term debt (Notes 5, 6 and 9)
Current portion of long-term debt (Notes 5, 6 and 9)
Trade payables (Notes 5 and 6)
Lease obligations (Notes 6 and 10)
Advances received
Income taxes payable (Note 17)
Other current liabilities (Notes 17 and 24)
Total Current Liabilities
Long-term Liabilities:
Long-term debt (Notes 5, 6, and 9)
Lease obligations (Notes 6 and 10)
Net defined benefit liability (Note 11)
Provision for directors’ retirement benefits
Deferred tax liabilities (Note 17)
Other long-term liabilities (Note 24)
Total Long-term Liabilities
Total Liabilities

2019

2018

2019

¥ 29,508
26,788
196,669
11,99145,496
10,892
104,550
425,894¥ 31,998
21,867
183,976
12,15348,5698,293
97,885
404,741$   268,258
243,531
1,787,907
109,016
413,606
99,026
950,421
3,871,765

60,54825,14845,794
215
475
2,524
134,704
560,598

74,43523,05342,519
185
755
2,510
143,457
548,198

550,441
228,624
416,314
1,959
4,320
22,9271,224,585
5,096,350

47,586—
46,067
223,940—
47,58645,986
195,517432,601—
418,7932,035,819(7,316)—
310,277—(7,284)
281,805(66,514)—2,820,699

43,974(280)
368(1,417)42,645
39,139392,061¥952,659

47,665
88
1,574
(496)
48,83135,910366,546¥914,744

399,772(2,549)3,348(12,889)
387,682355,8143,564,195$8,660,545

Contingent Liabilities (Note 19):
Net Assets (Note 25)
Shareholders’ Equity:
Capital stock (Note 12):
Authorized - 320,000,000 shares
Issued- 149,296,991 shares as of March 31, 2019
149,296,991 shares as of March 31, 2018
Capital surplus
Retained earnings
Treasury stock at cost (Note 12):6,451,315 shares as of March 31, 2019
6,443,142 shares as of March 31, 2018
Total Shareholders’ Equity
Accumulated Other Comprehensive Income (Loss):
Valuation difference on available-for-sale securities
Deferred gains or losses on hedges (Notes 6 and 8)
Foreign currency translation adjustments
Remeasurements of defined benefit plans
Total Accumulated Other Comprehensive Income
Non-controlling Interests
Total Net Assets
Total Liabilities and Net Assets

Fuji Electric Report Financials 201910

Consolidated Statements of Income
Years ended March 31, 2019 and 2018
Thousands of
U.S. dollars(Note 3)

Millions of yen

2019

2018

2019

Net Sales
Cost of Sales (Note 13)
Gross Profit¥914,915
679,877
235,038¥893,451
661,824
231,627$8,317,414
6,180,698
2,136,716

Selling, General and Administrative Expenses (Notes 13 and 14)
Operating Income

175,066
59,972

175,665
55,962

1,591,513
545,203

3,122(1,377)
(520)
89
1,682
511
3,507
63,4792,503(1,621)—(2,080)1,236
47
85
56,04728,388(12,521)(4,727)811
15,297
4,636
31,884
577,087(1,192)62,287758
56,805(10,837)
566,250

17,21745,07014,80442,001

156,517409,733

4,803¥ 40,267

4,238¥ 37,763

43,660$   366,073

Non-Operating Income (Expenses):
Interest and dividend income
Interest expense
Provision of allowance for doubtful accounts for subsidiaries and affiliates
Foreign exchange gains (losses)
Equity in earnings of affiliates
Other, net
Ordinary Income
Extraordinary Income (Loss), Net (Note 15)
Income Before Income Taxes
Income Taxes (Note 17)
Net Income
Net Income Attributable To Non-controlling Interests
Net Income Attributable To Owners of Parent (Note 25)
The accompanying Notes to the Consolidated Financial Statements are an integral part of these statements.

11 Fuji Electric Report Financials 2019

Consolidated Statements of Comprehensive Income
Years ended March 31, 2019 and 2018
Thousands of
U.S. dollars(Note 3)

Millions of yen

Net Income

2019

2018

2019

¥45,070¥42,001$409,733(3,782)(369)(1,361)(1,106)

5,093
1,688
1,600
2,301

(34,383)(3,358)(12,358)(10,063)

Other Comprehensive Income (Loss) (Note 18)
Valuation difference on available-for-sale securities
Deferred gains or losses on hedges
Foreign currency translation adjustments
Remeasurements of defined benefit plans
Share of other comprehensive income of associates accounted for using
equity method
Total Other Comprehensive Income (Loss)
Comprehensive Income

201

171

1,828

(6,417)¥38,653

10,853¥52,854(58,334)$351,399

Comprehensive Income Attributable to:
Owners of parent
Non-controlling interests¥34,082
4,571¥47,997
4,857$309,845
41,554

The accompanying Notes to the Consolidated Financial Statements are an integral part of these statements.

Fuji Electric Report Financials 201912

Consolidated Statements of Changes in Net Assets
Years ended March 31, 2019 and 2018
Thousands

Millions of yen

Number ofshares ofcapital stock

Capitalstock

CapitalsurplusRetainedearnings

Valuationdifference on
available-forsale securities

Deferred
gains orlosses onhedgesForeigncurrencytranslation
adjustments

Remeasurements ofdefinedbenefit plans

Treasury
stock

Total

Noncontrollinginterests

Total
net assets

Balance at March 31, 2017

746,484¥47,586¥45,985¥166,289¥42,751¥(1,600)¥   176¥ (2,730)¥(7,241)¥291,216¥32,647¥323,863

Net income attributable toowners of parent

—

—

—

37,763

—

—

—

—

—

37,763—37,763

Change of scope of
consolidation

—

—

—

36

—

—

—

—

—

36

—

36

Cash dividends

—

—

—

(8,571)

—

—

—

—

—

(8,571)—(8,571)

Purchase of treasury stock

—

—

—

—

—

—

—

—

(43)

(43)

—

(43)

Sales of treasury stock

—

—

1

—

—

—

—

—

0

1

—

1

Change in treasury shares of parent arising fromtransactions with
non-controlling shareholders

—

—

0

—

—

—

—

—

—

0

—

0

Net changes of items other thanshareholders’ equity

—

—

—

—

4,914

1,688

1,398

2,234

—

10,234

3,263

13,497

Balance at March 31, 2018

746,484¥47,586¥45,986¥195,517¥47,665¥    88¥ 1,574¥   (496)¥(7,284)¥330,636¥35,910¥366,546

Net income attributable toowners of parent

—

—

—

40,267

—

—

—

—

—

40,267—40,267

Change of scope of
consolidation

—

—

—

(416)

—

—

—

—

—

(416)

—

(416)

Cash dividends

—

—

—

(11,428)

—

—

—

—

—

(11,428)—(11,428)

Purchase of treasury stock

—

—

—

—

—

—

—

—

(32)

(32)

—

(32)

Sales of treasury stock

—

—

2

—

—

—

—

—

0

2

—

2

Change in treasury shares of parent arising fromtransactions with
non-controlling shareholders

—

—

79

—

—

—

—

—

—

79

—

79

—

Net changes of items other thanshareholders’ equity(597,188)———(3,691)(368)(1,206)(921)

Balance at March 31, 2019

149,296¥47,586¥46,067¥223,940¥43,974¥  (280)¥   368¥  (1,417)

Balance at March 31, 2018

$432,601$418,059 $1,777,436$433,320$   808$ 14,297$ (4,515)

Net income attributable toowners of parent——

366,073

—

—

—

—

—

366,073—

366,073

Change of scope of
consolidation——(3,797)

—

—

—

—

—

(3,797)—(3,797)(6,186)

3,229(2,957)¥(7,316) ¥352,922¥39,139¥392,061$(66,224) $3,005,782$326,462 $3,332,244

Thousands of U.S. dollars (Note 3)

Cash dividends——(103,893)

—

—

—

—

—

(103,893)—(103,893)

Purchase of treasury stock

—

—

—

—

—

—

—

(297)

(297)

—

(297)

Sales of treasury stock

—

13

—

—

—

—

—

7

20

—

20

Change in treasury shares of parent arising fromtransactions with
non-controlling shareholders

—

721

—

—

—

—

—

—

721

—

721

—

—

(33,548)(3,357)(10,949)(8,374)—(56,228)

29,352(26,876)$418,793 $2,035,819$399,772$(2,549)$   3,348$(12,889)

Net changes of items other thanshareholders’ equity
Balance at March 31, 2019—
$432,601

The accompanying Notes to the Consolidated Financial Statements are an integral part of these statements.

13 Fuji Electric Report Financials 2019$(66,514) $3,208,381$355,814 $3,564,195

Consolidated Statements of Cash Flows
Years ended March 31, 2019 and 2018
Thousands of
U.S. dollars(Note 3)

Millions of yen

Cash Flows from Operating Activities:
Income before income taxes
Depreciation and amortization
Increase (decrease) in allowance for doubtful accounts
Interest and dividend income
Interest expense
Foreign exchange losses (gains)
Gain on sales of noncurrent assets
Gain on sales of investment securities
Loss on disposal of noncurrent assets
Loss on devaluation of investment securities
Impairment loss
Foreign currency translation adjustments reversal gains
Changes in operating assets and liabilities:
Trade receivables
Inventories
Trade payables
Advances received
Other, net
Cash generated from operations
Interest and dividends received
Interest expenses paid
Income taxes paid
Net cash provided by operating activities
Cash Flows from Investing Activities:
Purchase of property, plant and equipment
Proceeds from sales of property, plant and equipment
Purchase of investment securities
Proceeds from sales of investment securities
Payments of loans receivableCollection of loans receivable
Other, net
Net cash used in investing activities
Cash Flows from Financing Activities:
Net decrease in short-term loans payable
Proceeds from long-term loans payable
Repayment of long-term loans payable
Proceeds from issuance of bonds
Redemption of bonds
Repayments of lease obligations
Proceeds from sales of treasury stock
Purchase of treasury stock
Cash dividends paid
Cash dividends paid to non-controlling interests
Payments from changes in ownership interests in subsidiaries that do not result inchange in scope of consolidation
Other, net
Net cash used in financing activities
Effect of Exchange Rate Changes on Cash and Cash Equivalents
Net Decrease in Cash and Cash Equivalents
Cash and Cash Equivalents at Beginning of Year
Increase in Cash and Cash Equivalents Resulting from Change of
Scope of Consolidation
Cash and Cash Equivalents at End of Year

2019

2018

2019

¥ 62,287
30,906802(3,122)
1,377
(544)
(96)
(1,055)
1,121
279
2,242
(1,299)¥ 56,805
30,151(347)(2,503)
1,621
741
(209)
(1,691)
366
776
—
—

$ 566,250
280,965
7,295(28,388)
12,521(4,948)(876)(9,594)
10,194
2,543
20,383(11,813)(21,949)(26,937)
12,410(3,129)12,18665,4793,142(1,412)(12,260)
54,949(16,633)(6,933)18,6453,487
4,380
88,6562,507(1,652)(36,365)
53,146(199,542)(244,883)
112,823(28,448)
110,789595,271
28,568(12,840)(111,455)
499,544(15,932)
354
(639)
1,600
(7,381)
7,339(6,789)(21,448)(12,279)640(2,362)
2,741(4,634)
5,299(3,955)(14,550)(144,842)
3,220(5,810)14,546(67,109)66,723(61,713)(194,985)(2,680)3,044(2,068)10,000(20,000)(13,106)
2(32)(11,428)(1,340)(4,570)2,060(25,559)
10,000(5,000)(12,785)0(43)(8,571)(2,364)(24,366)
27,679(18,805)
90,909(181,818)(119,153)20(297)(103,893)(12,184)

(512)

(1)

(4,655)(52)(38,172)338(4,333)33,329(54)(46,887)(374)(8,665)41,886(474)(347,037)
3,078(39,400)
302,999

138

108

1,263

¥ 29,134¥ 33,329$ 264,862

The accompanying Notes to the Consolidated Financial Statements are an integral part of these statements.

Fuji Electric Report Financials 201914

Notes to the Consolidated Financial Statements
Note 1. Basis of Preparing Consolidated Financial Statements
The accompanying consolidated financial statements of Fuji ElectricCo., Ltd. (the “Company”) and consolidated subsidiaries (together,
the “Companies”) are prepared on the basis of accounting principles
generally accepted in Japan, which are different in certain respects
as to application and disclosure requirements of International
Financial Reporting Standards, and are compiled from the consolidated financial statements prepared by the Company as required by
the Financial Instruments and Exchange Law of Japan.

In preparing these statements, certain reclassifications andrearrangements have been made to the consolidated financial
statements prepared domestically in Japan in order to present thesestatements in a form that is more familiar to readers outside Japan.
In addition, the notes to the consolidated financial statements
include additional information which is not required underaccounting principles generally accepted in Japan.
Certain amounts in the prior year’s financial statements havebeen reclassified to conform to the current year’s presentation.

Note 2. Summary of Significant Accounting Policies
a. Principles of Consolidation
The consolidated financial statements for the year ended March 31,
2019 include the accounts of the Company and its 72 significant
subsidiaries and its 4 subsidiaries and affiliates are accounted for by
the equity method (70 and 5 in FY2018).
Under the control or influence concept, the accompanying
consolidated financial statements include the accounts of theCompany and, with minor exceptions, those of its subsidiaries,
whether directly or indirectly controlled, and those companies overwhich the Companies have the ability to exercise significant influence
are accounted for by the equity method. All significant intercompany
balances and transactions have been eliminated in consolidation.
All material unrealized profits included in assets resulting from transactions within the Companies are eliminated. The Company does notconsolidate nor apply the equity method to subsidiaries or affiliates
whose gross assets, net sales, net income (loss) and retained
earnings are not significant to the consolidated financial statements.
Investments in unconsolidated subsidiaries and affiliates arestated at cost.
The balance sheet date of certain consolidated subsidiaries is
December 31 or January 31. In principle, the financial statementsof such subsidiaries were tentatively prepared in accordance withthe fiscal year of the Company, and those were consolidated.
In the elimination of investments in subsidiaries, the assets andliabilities of the subsidiaries, including the portion attributable tonon-controlling shareholders, are evaluated using the fair value atthe time the Company acquired control of the respective subsidiaries.
Goodwill resulting from the difference between the cost and theunderlying net assets at the respective dates of acquisition arebeing amortized over a period of 5 or 10 years.

b. Cash Equivalents
For the purpose of the consolidated statements of cash flows, theCompanies consider all short-term, highly liquid instruments witha maturity of three months or less to be cash equivalents.

c. Inventories
Raw materials are mainly stated at cost, determined by the mostrecent purchase price method. Finished goods and work in process
are mainly stated at actual cost determined by accumulated
production cost for contract items or average cost for regular
production items, except that finished goods of certain consolidated
subsidiaries are priced by the most recent purchase price method.
In accordance with accounting practices generally accepted in the

15 Fuji Electric Report Financials 2019heavy electric industry, inventories include items with a manufacturing period exceeding one year.
Inventories with lower profitability were written down and thelosses on valuation were included in cost of sales.

d. Securities
Marketable securities classified as other securities are stated at fairvalue. Unrealized gains and losses, net of taxes, are reported in a
separate component of net assets.
Nonmarketable securities classified as other securities are statedat cost determined by the moving-average method.

e. Derivatives and Hedging Activities
The Companies enter into derivative financial instruments (“derivatives”), including foreign currency forward contracts to hedge foreignexchange risk associated with certain assets and liabilities denominated in foreign currencies and interest rate and currency swap
agreements as a means of managing its interest rate and foreign
currency exposures on certain liabilities.
In addition, the Companies enter into commodity swap agreements to hedge the risk of fluctuation of commodity prices for
raw materials.
Derivative financial instruments and foreign currency transactions
are classified and accounted for as follows:a) Except as described in the following paragraphs b) and c),
all derivatives are recognized as either assets or liabilities andmeasured at fair value, and forward contracts applied forforecasted transactions are measured at fair value but theunrealized gains/losses are deferred until the underlying
transactions are completed if the forward contracts qualify forhedge accounting.
b) Trade receivables and trade payables denominated in foreign
currencies for which foreign exchange forward contracts areused to hedge the foreign currency fluctuations are accounted
for allocation treatment (“Furiate shori”) where these receivables and payables are translated at the contracted rate if theforward contracts qualify for hedge accounting.
c) The interest rate and currency swaps which qualify for hedge
accounting and meet criteria for exceptional accounting
treatment (“Tokurei shori”) and allocation treatment (“Furiate
shori”) under hedge accounting are accounted for integrated
treatment (“Ittai shori”).

f. Depreciation
1) Tangible fixed assets (excluding leased assets)
Depreciation is computed by the declining-balance method at rates
based on the estimated useful lives of the assets, while the straightline method is applied to the buildings of the Company and its
domestic consolidated subsidiaries acquired after April 1, 1998 andthe facilities attached to buildings and the other non-building structuresacquired after April 1, 2016. The range of useful lives is from 15 to
50 years for buildings and from 5 to 12 years for machineryand equipment.
2) Leased assets
Depreciation is computed by the straight-line method over the lease
period assuming no residual value. Finance leases other than thosethat were deemed to transfer the ownership of the leased assets tothe lessees and contracted before April 1, 2008, are accounted forby the method that is applicable to ordinary operating leases.

g. Allowance for Doubtful Accounts
The allowance for doubtful accounts is stated in amounts considered
to be appropriate based on the Companies’ past credit loss experienceand an evaluation of potential losses in the receivables outstanding.

h. Retirement Benefits(1) The retirement benefit obligation for employees is attributed toeach period by the benefit formula method over the estimatedyears of service of the eligible employees.
(2) The prior service costs are amortized by the straight-line method
within the average remaining years of service of the employees
participants. The actuarial gains and losses are amortized by thestraight-line method within the average remaining years ofservice of the employee participants from the next period inwhich they arise, respectively.

i. Provision for Directors’ Retirement Benefits
For certain consolidated subsidiaries, the accrued retirement
benefits for directors were provided mainly at an amount to berequired at the year-end according to internal regulations.

bases of assets and liabilities. Deferred taxes are measured byapplying currently enacted tax laws to the temporary differences.

m. Foreign Currency Transactions
All monetary receivables and payables denominated in foreign
currencies are translated into Japanese yen at the exchange rates
at the balance sheet date. The foreign exchange gains and losses
from translation are recognized in the consolidated statements
of income to the extent that they are not hedged by forward
exchange contracts.

n. Foreign Currency Financial Statements
Assets, liabilities, and revenue and expense accounts of the foreign
consolidated subsidiaries are translated into Japanese yen at thecurrent exchange rate as of the balance sheet date except forshare holders’ equity, which is translated at the historical rate.
Differences arising from such translation are included in foreign
currency translation adjustments and non-controlling interests inconsolidated subsidiaries as a separate component of net assets.

o. Accounting for Consumption Taxes
The Japanese consumption taxes withheld and consumption taxes
paid are not included in the accompanying consolidated statements of income.

p. Amounts Per Share
Basic net income per share is computed based on the net income
attributable to common shareholders of the parent and theweighted average number of shares of common stock outstanding
during the year, and diluted net income per share is computed
based on the net income attributable to owners of parent’s common
stock and weighted average number of shares of common stock
outstanding during each year after giving effect to the dilutive potentialof shares of common stock to be issued upon the exercise of
warrants and stock subscription rights.
Net assets per share are computed based on the net assets
excluding share subscription rights and non-controlling interests
and the number of shares of common stock outstanding at theyear end.

j. Research and Development Costs
Research and development costs are charged to income as incurred.

k. Recognition for Revenue and Costs
For long-term construction contracts whose outcome can be
estimated reliably, the percentage-of-completion method isadopted. The stage of completion of a contract is determined by
the percentage of the cost incurred to date to the estimated total
cost. When the outcome of the construction contracts cannot be
estimated reliably, the completed-contract method is adopted.

l. Income Taxes
The provision for income taxes is computed based on the pretax
income included in the consolidated statements of income. The
Company filed a consolidated tax return, which allows companies
to file tax payments on the combined basis of profits or losses ofthe parent company and its wholly owned domestic subsidiaries.
The asset and liability approach is used to recognize deferred tax
assets and liabilities for the expected future tax consequences of
temporary differences between the carrying amounts and the tax

q. Accounting Standards Issued but not yet Effective- “Accounting Standard for Revenue Recognition” (AccountingStandard Board of Japan (“ASBJ”) statement No. 29 issued on
March 30, 2018)- “Implementation Guidance on Accounting Standard for Revenue
Recognition” (ASBJ Guidance No. 30 issued on March 30, 2018)(1) Overview
	International Accounting Standards Board (“IASB”) and Financial
Accounting Standards Board (“FASB”) worked together toward
development of a comprehensive accounting standard forrevenue recognition and “Revenue from Contracts with
Customers” was issued as IFRS 15 by the IASB and as ASC
606 by the FASB in May, 2014. IFRS 15 became effective forannual reporting periods beginning on or after January 1,
2018 and ASC 606 became effective for the periods beginningon or after December 15, 2017. In light of these circumstances,
the ASBJ developed and issued a comprehensive accounting
standard for revenue recognition together with an implementation guidance.

Fuji Electric Report Financials 201916

The ASBJ’s basic policy for developing accounting standard forrevenue recognition is to build the standard on the core principle of
IFRS 15 in terms of international comparability between financial
statements that is one of the benefits of convergence toward IFRS
15. It also stated that alternative accounting treatment may be
additionally adopted locally, to make consideration to the current
Japanese practices if necessary, provided such alternative treatments would not impair international comparability.
(2) Scheduled date of adoption
	The Companies expect to adopt the accounting standard andimplementation guidance from the beginning of the fiscal year
ending March 31, 2022.
(3)	Impact of the adoption of accounting standard andimplementation guidance	The Companies are currently evaluating the effect of the
adoption of this accounting standard and implementation
guidance on the consolidated financial statements.

r. Change in Methods of Presentation- “Partial Amendments to Accounting Standard for Tax EffectAccounting” (Accounting Standard Board of Japan (“ASBJ”)
statement No. 28 revised on February 16, 2018)
Effective April 1, 2018, the Company and its domestic consolidated
subsidiaries have adopted “Partial Amendments to AccountingStandard for Tax Effect Accounting” (ASBJ Statement No. 28,
revised on February 16, 2018). As such, deferred tax assets anddeferred tax liabilities are included within investments and otherassets and long-term liabilities, respectively.
As a result, ¥17,763 million of deferred tax assets in current
assets, ¥495 million of other current liabilities in current liabilities and¥3,620 million of deferred tax liabilities in long-term liabilities previously
presented in consolidated balance sheet as of March 31, 2018 havebeen reclassified and included within ¥15,911 million of deferred tax
assets in investments and other assets and ¥755 million of deferred
tax liabilities in long-term liabilities, respectively.

Note 3. U.S. Dollar Amounts
The U.S. dollar amounts included in the accompanying consolidated
financial statements and notes thereto represent the arithmetic resultsof translating yen into U.S. dollars at ¥110=U.S.$1, the approximate

exchange rate as of March 31, 2019. The U.S. dollar amounts arepresented solely for the convenience of the readers outside Japan.

Note 4. Inventories
Inventories as of March 31, 2019 and 2018 consisted of the following:Thousands of
U.S. dollars (Note 3)

Millions of yen

Merchandise and finished goods
Work in process
Raw materials
Inventories

2019

2018

2019

¥ 62,185
63,91450,873¥176,972¥ 57,821
50,372
41,564¥149,757$   565,327
581,038
462,472$1,608,837

Losses on valuation of inventories with lower profitability were ¥390 million ($3,548 thousand) and ¥210 million for the years ended March 31,
2019 and 2018, respectively. These were included in cost of sales.

Note 5. Pledged Assets and Financial Assets Accepted as Collateral
The amounts of assets pledged as collateral for trade payables, short-term debt and long-term debt as of March 31, 2019 and 2018 wereas follows:
Thousands of
U.S. dollars (Note 3)

Millions of yen

Investment securities
Property, plant and equipment
Intangible assets
Total

2019

2018

2019

¥   14
1,545
415¥1,974¥   22
1,812
445¥2,279$   130
14,052
3,767$17,949

Collateralized liabilities as of March 31, 2019 and 2018 were as follows:
Thousands of
U.S. dollars (Note 3)

Millions of yen

2019

Trade payables
Short-term debt
Long-term debt
Total

17 Fuji Electric Report Financials 2019¥   77891
101¥1,069

2018

¥ 78
412
140
¥630

2019

$   700
8,100
919$9,719

Note 6. Financial Instruments
1. Status of Financial Instruments(1) Policy regarding financial instruments
The Companies limit the scope of their cash and fund management
activities to short-term deposits. When raising funds, the Companies
have a policy of relying principally on bank borrowings, bonds
payable and commercial paper. The Companies mainly raise theoperating funds through short-term loans payable and commercial
paper, and the funds relating to capital investments through longterm loans payable and bonds payable. The Companies make useof derivatives to reduce risk, as explained below, and have a policyof not engaging in derivative transactions for speculative purposes.
(2) Details of financial instruments and associated risk
In the course of its business activities, trade receivables are
exposed to customer credit risk.
In addition, trade receivables denominated in foreign currencies
arising from international business are exposed to exchange risk.
The Companies hedge the exchange risk, by using foreign exchange
forward contracts within the range prescribed relating to the net
amount of the trade receivables denominated in foreign currencies,
offset by the amount of the trade payables denominated in thesame currencies.
Short-term investments and investment securities are comprised
primarily of stocks of companies with which the Companies havebusiness relation and are exposed to market price risk.
Trade payables are mostly payable within one year. Some trade
payables are denominated in foreign currencies and exposed to
exchange risk. The Companies hedge the exchange risk of the
trade payables denominated in foreign currencies in principle, except
for the amount within that of trade receivables denominated in thesame currencies, by using foreign exchange forward contracts.
Short-term loans payable and commercial paper are primarilyraised for the purpose of maintaining operating funds. Bonds
payable, long-term loans payable and lease obligations on financelease transactions are primarily raised for the purpose of preparing
capital investment. The maturities of these bonds payable, long-termloans payable and lease obligations on finance lease transactions
are up to14 years at the longest after the balance sheet date. Someare exposed to interest rate fluctuation risk and the Companies
hedge such risk by interest rate and currency swap transactions.
Regarding derivatives, the Companies employ foreign exchange
forward contracts to reduce the risk of foreign currency exchange
movements that arise from the previously mentioned receivables
and payables denominated in foreign currencies. In addition, theCompanies use interest rate and currency swap transactions to
reduce the interest rate fluctuation risk of loans, and use commodity
swap transactions to reduce the risk of fluctuation of commodity
prices for raw materials. As hedging instruments under hedge
accounting, the Companies enter into these derivative transactionsin accordance with Companies’ policies to reduce the corresponding
risk to each hedged item. The Companies compare the market
change of hedged items and hedging instruments or the cash flowchanges. Assessment of effectiveness for hedging activities depends
on the ratio of the amount of change.

(3) Systems for management of financial instruments riska) Credit risk management (the risk that transaction partners
may default on their obligations to the Companies)
The credit risk in relation to trade receivables from customers,
pursuant to criteria for managing credit exposure, is managed bycontrolling due dates and balances of each customer. In addition,
the Companies manage to identify doubtful receivables earlier andmitigate their risk caused by aggravation of the financing position, etc.
Because the counterparties to derivative transactions are limited
to authentic financial institutions, the Companies do not anticipate
any losses arising from credit risk.
b) Market risk management (the risks arising from fluctuations
in exchange rates, interest rates and other indicators)
The Companies, in principle, employ foreign exchange forward
contracts to reduce the risk of foreign currency exchange
movements that arise from the previously mentioned receivables
and payables denominated in foreign currencies. In addition, theCompanies use interest rate and currency swap transactions to
reduce the interest rate and exchange fluctuation risk of loans, anduse commodity swap transactions to reduce the risk of fluctuationof commodity prices for raw materials.
Regarding investment securities, the Companies periodicallyreview the market value of such financial instruments and the financial
position of the issuer (the company having business transactions
with the Companies). In addition, other than debt securities to beheld until maturity, the Companies review the status of theseinvestments on a continuing basis.
Derivative transactions have been entered into in accordancewith the Companies’ policies. The execution of derivatives, which
is based on the application of each section, is mainly controlled by
the Finance Department of each company, or by the Material
Section regarding commodity swap transactions. In addition, theFinance Department periodically reports to the management andeach section, and strictly performs risk management relating toderivative transactions.
c) Liquidity risk management (the risk that the Companies
may not be able to meet its payment obligations on thescheduled date)
The Companies reduce the liquidity risk by having each company
review and revise cash management plans monthly or timely.
(4) Supplementary explanation of the estimated fair value offinancial instruments and related matters
The estimated fair value of financial instruments is their price basedon their market price and other indicators. When there is no market
price available, it includes prices which are reasonably computed.
Since variable factors are taken into account in computing theprice, this price may fluctuate depending on different assumptions
adopted. In addition, the contract (notional) amount of derivatives in“Note 8. Derivatives” is not an indicator of the actual market risk
involved in derivative transactions.

Fuji Electric Report Financials 201918

2. Estimated Fair Value and Other Matters Related to Financial Instruments
Carrying amounts on the consolidated balance sheets as of March 31, 2019 and 2018, estimated fair value and the variance between them
are shown in the following table. Financial instruments whose estimated fair value is deemed to be extremely difficult to obtain are notincluded (Please refer to Note 2).
Millions of yen

2019

Cash and cash equivalents
Trade receivables
Investment securities
Trade payables
Short-term debt
Current portion of long-term debt
Lease obligations (Current Liabilities)
Long-term debt
Lease obligations (Long-term Liabilities)
Derivatives
Derivative transactions to which hedge accounting is not applied
Derivative transactions to which hedge accounting is applied

Carrying amounts

Fair value

Variance¥   29,134
308,831
117,739(196,669)(29,508)(26,788)(11,991)(60,548)(25,148)¥   29,134
308,808
128,010(196,669)(29,508)(26,788)(11,991)(61,044)(25,472)¥     —
(23)
10,271
—
—
—
—
496
324

24
(404)

24
(404)

—
—

Millions of yen

2018

Cash and cash equivalents
Trade receivables
Investment securities
Trade payables
Short-term debt
Current portion of long-term debt
Lease obligations (Current Liabilities)
Long-term debt
Lease obligations (Long-term Liabilities)
Derivatives
Derivative transactions to which hedge accounting is not applied
Derivative transactions to which hedge accounting is applied

Carrying amounts

Fair value

Variance¥   33,329
287,084
120,305(183,976)(31,998)(21,867)(12,153)(74,435)(23,053)¥   33,329
286,992
132,928(183,976)(31,998)(21,895)(12,153)(74,602)(23,355)¥     —
(92)
12,623
—
—
28
—
167
302

16
128

16
128

—
—

Thousands of U.S. dollars (Note 3)

2019

Cash and cash equivalents
Trade receivables
Investment securities
Trade payables
Short-term debt
Current portion of long-term debt
Lease obligations (Current Liabilities)
Long-term debt
Lease obligations (Long-term Liabilities)
Derivatives
Derivative transactions to which hedge accounting is not applied
Derivative transactions to which hedge accounting is applied

Carrying amounts

Fair value

Variance$    264,862
2,807,558
1,070,362(1,787,907)(268,258)(243,531)(109,016)(550,441)(228,624)$    264,862
2,807,346
1,163,729(1,787,907)(268,258)(243,531)(109,016)(554,949)(231,564)$     —
(212)
93,367
—
—
—
—
4,508
2,940

225
(3,674)225(3,674)——(*1) Figures shown in parentheses are liability items.
(*2) The value of assets and liabilities arising from derivatives is shown at net value, and a net liability position is shown in parentheses.

19 Fuji Electric Report Financials 2019

Notes: 1. Methods for computing the estimated fair value of financial instruments, and information on securities and derivatives		 (1) Cash and cash equivalents
			 Since these items are settled in a short period of time, estimated fair values are virtually the same as the carrying amounts.
		 (2) Trade receivables
			Fair values of trade receivables, classified by each maturity, are based on the present value discounted by the interest rate determined taking into account the term until
maturity and the credit risk.
		 (3) Investment securities
			Stocks are valued at the exchange trading price. For information on securities classified by the purpose of holding, please refer to “Note 7. Securities”.
		 (4)	Trade payables, (5) Short-term debt, (6) Current portion of long-term debt (except bonds) and (7) Lease obligations (Current Liabilities)
Since these items are settled in a short period of time, estimated fair values are virtually the same as the carrying amounts.
		 (6) Current portion of long-term debt (bonds) and (8) Long-term debt (bonds)
			 Fair values of bonds issued by the Company are based on each market price.
		 (8) Long-term debt (except bonds) and (9) Lease obligations (Long-term Liabilities)
			Fair values of these items are based on the present value of the total of principal and interest discounted by the interest rate applied if similar new borrowings and new leasetransactions were entered into.
		 (10) Derivatives
			 Please refer to “Note 8. Derivatives”.
2. Items for which obtaining an estimated fair value is deemed to be extremely difficult.
Thousands of
U.S. dollars(Note 3)

Millions of yen

Unlisted stocks (including stocks of unconsolidated subsidiaries and affiliates)

2019

2018

2019

Carrying amounts

Carrying amounts

Carrying amounts¥15,608¥15,609$141,898

	Because the items in the preceding table do not have market price and obtaining the estimated fair values of these items is deemed to be extremely difficult, fair value has notbeen disclosed in (3) Investment securities.

3. Redemption schedule for monetary assets and securities with maturity dates as of March 31, 2019 and 2018:
Millions of yen

2019Within 1 year

Between 1 and5 years

Between 5 and10 years

Cash and cash equivalents¥ 29,134

¥   —

¥—

Trade receivables

299,560

9,206

64

—

		Total¥328,694¥9,206¥64¥—

Over 10 years¥—

Millions of yen

2018
Within 1 year

Between 1 and5 years

Between 5 and10 years

Cash and cash equivalents¥ 33,329¥    —¥—

Trade receivables

260,206

26,878——

		Total¥293,535¥26,878¥—¥—

Over 10 years¥—

Thousands of U.S. dollars (Note 3)

2019
Within 1 year

Between 1 and5 years

Between 5 and10 years

Over 10 years

Cash and cash equivalents$   264,862$    —$ —Trade receivables

2,723,270

83,699589—

		Total$2,988,132$83,699

$589

$—

$—

4. Repayment schedule for long-term debt and lease obligations:
		 Please refer to “Note 9. Short-term Debt and Long-term Debt” and “Note 10. Lease Obligations”.

Fuji Electric Report Financials 201920

Note 7. Securities
1. Other Securities as of March 31, 2019 and 2018 were as Follows:
Millions of yen

2019Marketable securities classified as other securities
Equity securities
Debt securities
Others
Total

Cost

Carrying amounts¥41,069——¥41,069¥104,610——¥104,610

Unrealized gains

Unrealized losses¥64,104——¥64,104¥(563)——¥(563)

Unrealized gains

Unrealized losses¥69,243——¥69,243¥(537)——¥(537)

Millions of yen

2018Marketable securities classified as other securities
Equity securities
Debt securities
Others
Total

Cost

Carrying amounts¥39,284——¥39,284¥107,990——¥107,990

Thousands of U.S. dollars (Note 3)

2019

Marketable securities classified as other securities
Equity securities
Debt securities
Others
Total

Cost

Carrying amounts

Unrealized gains

Unrealized losses$373,359——$373,359$951,002——$951,002$582,765——$582,765$(5,122)——$(5,122)

Note: T he following is not included in the preceding tables because it does not have market price and obtaining an estimated fair value is deemed to be extremely difficult:
Unlisted stocks (Values in the consolidated balance sheets as of March 31, 2019 and 2018 were ¥4,124 million ($37,491 thousand) and ¥4,026 million, respectively.)

2. Sales of other securities for the years ended March 31, 2019 and 2018 were as follows:
Thousands of
U.S. dollars (Note 3)

Millions of yen

Proceed from sales
Gain on sales
Loss on sales

2019

2018

2019

¥1,5901,055—¥2,6331,691(1)$14,455
9,594—

3. Impairment of other securities for the years ended March 31, 2019 and 2018 were as follows:
Thousands of
U.S. dollars (Note 3)

Millions of yen

2019

Impairment losses

21 Fuji Electric Report Financials 2019

¥279

2018

¥776

2019

$2,543

Note 8. Derivatives
1. Derivative Transactions to which Hedge Accounting is Not Applied
Millions of yen

2019
Contract amountForeign currency forward contracts:
Receivables:
U.S. Dollar
Euro
Won
Baht
Yuan Renminbi
Payables:U.S. Dollar
Yen
Total

Contract amountover 1 year

Fair value

Unrealized
gain/loss¥2,708
1,924
112
136
1,624

¥—
—
—
—
—

¥(16)
54
(0)
(3)
(13)

¥(16)
54
(0)
(3)
(13)

205
22
¥6,731

—
—
¥—

2
0
¥ 24

2
0
¥ 24

Millions of yen

2018
Contract amountForeign currency forward contracts:
Receivables:
U.S. Dollar
Euro
Won
Baht
Payables:U.S. Dollar
Won
Yen
New Taiwan Dollar
Total

Contract amountover 1 year

Fair value

Unrealized
gain/loss¥2,234
1,046
507
109

¥  —
—
197
—

¥ 14
15
(4)
(10)

¥ 14
15
(4)
(10)

506
198
12
7
¥4,619

—
—
—
—
¥197

(4)
5
(0)
(0)
¥ 16

(4)
5
(0)
(0)
¥ 16

Thousands of U.S. dollars (Note 3)

2019
Contract amountForeign currency forward contracts:
Receivables:
U.S. Dollar
Euro
Won
Baht
Yuan Renminbi
Payables:U.S. Dollar
Yen
Total

Contract amountover 1 year

Fair value

Unrealized
gain/loss$24,596
17,492
1,023
1,245
14,772$—————$(122)
494
(7)
(36)
(126)

$(122)
494
(7)
(36)
(126)

1,871
200
$61,199

—
—
$—

21
1
$ 225

21
1
$ 225

Note: The fair value is estimated based on forward exchange rates.

Fuji Electric Report Financials 201922

2. Derivative Transactions to which Hedge Accounting is Applied(1) Currency-related contracts
Millions of yen

2019
Hedge accounting
methodDeferral hedge
methodAllocation method

Type of derivative

Foreign currency forward contracts:
Receivables:
U.S. Dollar
Euro
Baht
Payables:U.S. Dollar
Euro
Singapore Dollar
Foreign currency forward contracts:
Receivables:
U.S. Dollar
Yuan Renminbi
Baht
Payables:U.S. Dollar
Euro
Total

Principal items hedged

Accounts receivable–trade

Accounts payable–trade

Accounts receivable–trade

Accounts payable–trade

Contract amountContract amountover 1 year

Fair value¥ 5,461
2,048
25¥1,814——¥(223)
20
(1)

3,750
6,375
32

—
2,537
—

42
(242)
0

¥ 2,201184168¥    ———(Note2)

1,078
178¥21,500——¥4,351¥(404)

Millions of yen

2018
Hedge accounting
methodDeferral hedge
methodAllocation method

Type of derivative

Foreign currency forward contracts:
Receivables:
U.S. Dollar
Euro
Payables:U.S. Dollar
Euro
Pound Sterling
Singapore Dollar
Swiss Franc
Australian Dollar
Foreign currency forward contracts:
Receivables:
U.S. Dollar
Yuan Renminbi
Baht
Payables:U.S. Dollar
Euro
Singapore Dollar
Swiss FrancTotal

23 Fuji Electric Report Financials 2019

Principal items hedged

Accounts receivable–trade
Accounts payable–trade

Accounts receivable–trade

Accounts payable–trade

Contract amountContract amountover 1 year

Fair value¥ 7,417
1,448¥2,058
—

¥ 354
(18)

8,596
11,175
395
99
26
7

2
6,213
—
—
—
—

(107)
(89)
(8)
(3)
(1)
(0)

¥ 1,388299
148¥    ———(Note2)

589
941
66
0
¥32,594————¥8,273¥ 128

Thousands of U.S. dollars (Note 3)

2019
Hedge accounting
methodDeferral hedge
methodAllocation method

Type of derivative

Foreign currency forward contracts:
Receivables:
U.S. Dollar
Euro
Baht
Payables:U.S. Dollar
Euro
Singapore Dollar
Foreign currency forward contracts:
Receivables:
U.S. Dollar
Yuan Renminbi
Baht
Payables:U.S. Dollar
Euro
Total

Principal items hedged

Accounts receivable–trade

Accounts payable–trade

Accounts receivable–trade

Accounts payable–trade

Contract amountContract amountover 1 year

Fair value$ 49,652
18,620232$16,498——$(2,035)183(9)34,092
57,909297—
23,064—388(2,202)
1$ 20,017
1,679
1,534

$     ———

(Note2)

9,801
1,622
$195,455——$39,562$(3,674)

Notes: 1. The fair value is estimated based on forward exchange rates.
2. S
 ince amounts in foreign currency forward contracts treated by the allocation method are handled together with accounts receivable-trade and accounts payable-trade that are
subject to hedging, the estimated fair value of such contracts is included in the fair value of accounts receivable-trade or accounts payable-trade.

(2) Interest-rate-related contracts
Millions of yen

2019
Hedge accounting method

Type of derivative

Principal items hedgedExceptional accounting Interest rate and currency swap Long-term loans payable
treatment and allocation contracts (Floating rate receipts /treatment
Fixed rate payments)

Contract amount¥1,835Contract amountover 1 year

Fair value¥1,835(Note2)Millions of yen

2018
Hedge accounting method

Type of derivative

Principal items hedged

Exceptional accounting Interest rate and currency swap Long-term loans payable
treatment and allocation contracts (Floating rate receipts /treatment
Fixed rate payments)

Contract amount¥1,835Contract amountover 1 year

Fair value¥1,835(Note 2)Thousands of U.S. dollars (Note 3)

2019
Hedge accounting method

Type of derivative

Principal items hedgedExceptional accounting Interest rate and currency swap Long-term loans payable
treatment and allocation contracts (Floating rate receipts /treatment
Fixed rate payments)

Contract amount$16,684

Contract amountover 1 year

$16,684

Fair value(Note2)

Notes: 1. The fair value is principally based on the quotes obtained from the correspondent financial institutions.
2. S ince amounts in interest rate swaps which qualify for hedge accounting and meet specific matching criteria are handled together with long-term loans payable that are subject
to hedging, the estimated fair value of such interest rate swaps is included in the fair value of the long-term loans payable.

Fuji Electric Report Financials 201924

Note 9. Short-term Debt and Long-term Debt
Short-term debt as of March 31, 2019 and 2018 consisted of the following:
Millions of yen

Loans, principally from banks
Commercial paper
Short-term debt

Thousands of
U.S. dollars (Note 3)

2019

2018

2019

¥21,508
8,000¥29,508¥31,998—¥31,998$195,530
72,728$268,258

Note: The weighted average interest rates on short-term debt as of March 31, 2019 and 2018 were 1.21% and 1.48%, respectively.

Long-term debt as of March 31, 2019 and 2018 consisted of the following:
Millions of yen

Loans, principally from banks and insurance companies
Bonds issued by the Company:
0.90% Yen unsecured straight bonds due June 6, 2018
0.38% Yen unsecured straight bonds due September 4, 2020
0.28% Yen unsecured straight bonds due August 31, 2023
0.40% Yen unsecured straight bonds due May 21, 2027
0.40% Yen unsecured straight bonds due May 25, 2028
Less: Portion due within one year
Long-term debt

Thousands of
U.S. dollars (Note 3)

2019

2018

2019

¥37,336¥36,302$339,427—
15,00015,00010,00010,00087,336
26,788¥60,548

20,00015,00015,00010,000—96,302
21,867¥74,435—
136,364
136,364
90,90990,909793,972
243,531$550,441

Note: The weighted average interest rates on loans, principally from banks and insurance companies, as of March 31, 2019 and 2018 were 0.57% and 0.45%, respectively.

As of March 31, 2019, the aggregate annual maturities of long-term debt were as follows:
Years ending March 31,

2021
2022
2023
2024
2025 thereafter
Total

Millions of yen

Thousands of
U.S. dollars (Note 3)¥16,976
4,239
346
17,594
21,393¥60,548$154,336
38,5383,149
159,947
194,471$550,441

Note 10. Lease Obligations
Lease obligations as of March 31, 2019 and 2018 consisted of the following:
Millions of yen

Short-termLong-term
Total

Thousands of
U.S. dollars (Note 3)

2019

2018

2019

¥11,991
25,148¥37,139¥12,153
23,053¥35,206$109,016
228,624$337,640

Millions of yen

Thousands of
U.S. dollars (Note 3)¥ 8,996
7,124
4,926
2,863
1,239
¥25,148$ 81,783
64,77044,78626,033
11,252$228,624

Note: The weighted average interest rates on lease obligations as of March 31, 2019 and 2018 were 1.70% and 1.98%, respectively.

As of March 31, 2019, the aggregate annual maturities of lease obligations were as follows:
Years ending March 31,

2021
2022
2023
2024
2025 thereafterTotal

25 Fuji Electric Report Financials 2019

Note 11. Retirement Benefits
1. Outline of Retirement Benefits for Employees
The Company and most of its consolidated subsidiaries have either
funded or unfunded defined benefit plans and defined contribution
pension plans.
Defined benefit corporate pension plans are all funded and coversubstantially all employees who are entitled to lump-sum or annuity
payments determined by reference to their basic rates of pay andlength of service. In addition, retirement benefit trust has been
established in certain pension plans.
Lump-sum payment plans are either unfunded or funded as aresult of establishing retirement benefit trust. They cover substantiallyall employees who are entitled to lump-sum payments determinedby reference to either points obtained with interest credits or theirbasic rates of pay and length of service.
Certain domestic consolidated subsidiaries adopted a simplified
method in the calculation of net defined benefit liability and retirement benefit expense. Certain domestic consolidated subsidiaries
have multi-employer corporate pension plans accounted for by thesame methods used for defined contribution pension plans because
they cannot reasonably calculate their portion of pension assets
corresponding to their contributions.

2. Information on Defined Benefit Pension Plans(1) The changes in the retirement benefit obligation except for plans accounted for by a simplified method during the years ended
March 31, 2019 and 2018 were as follows:
Thousands of
U.S. dollars (Note 3)

Millions of yen

Retirement benefit obligation at the beginning of the year
Service cost
Interest cost
Actuarial loss
Retirement benefits paid
Prior service cost
Difference arising from the change from simplified method to principle method
OthersRetirement benefit obligation at the end of the year

2019

2018

2019

¥187,344
3,202
2,488
1,296
(12,950)(0)—7¥181,387¥193,369
3,183
2,566
735
(13,767)
(294)
1,533
19
¥187,344$1,703,133
29,11522,621
11,785(117,733)(2)—
57$1,648,976(2) The changes in plan assets at fair value except for plans accounted for by a simplified method during the years ended
March 31, 2019 and 2018 were as follows:
Thousands of
U.S. dollars (Note 3)

Millions of yen

Plan assets at fair value at the beginning of the year
Expected return on plan assets
Actuarial gainContributions by the Companies
Retirement benefits paid
Difference arising from the change from simplified method to principle method
Redemption of the retirement benefit trust assets
OthersPlan assets at fair value at the end of the year

2019

2018

2019

¥186,726
2,166
(462)
1,753
(11,771)—(24,556)3¥153,859¥193,368
2,187
1,930
1,613
(13,015)645—(2)¥186,726$1,697,517
19,698(4,200)15,945(107,017)—(223,237)
19$1,398,725(3) The changes in net defined benefit liability calculated by a simplified method during the years ended March 31, 2019 and2018 were as follows:
Thousands of
U.S. dollars (Note 3)

Millions of yen

Retirement benefit obligation at the beginning of the year
Retirement benefit expenses
Retirement benefits paid
Contributions
Difference arising from the change from simplified method to principle method
OthersNet defined benefit liability at the end of the year

2019

2018

2019

¥1,792
280
(47)
(139)
—
(2)
¥1,884¥2,431
362
(98)
(157)
(724)
(22)
¥1,792$16,295
2,551(432)(1,271)—(13)$17,130

Fuji Electric Report Financials 201926

(4) The reconciliation of retirement benefit obligation and plan assets at fair value with net defined benefit liability and net defined
benefit asset recognized in the consolidated balance sheet were outlined as follows:

Thousands of
U.S. dollars (Note 3)

Millions of yen

2019

2018

2019

Unfunded retirement benefit obligation
Net amount of liabilities and assets recognized in the consolidated balance sheet¥ 180,868(157,467)
23,401
6,010¥   29,411¥ 186,955(190,198)(3,243)
5,653¥   2,410$ 1,644,262(1,431,522)
212,740
54,640$    267,380

Net defined benefit liability
Net defined benefit asset
Net amount of liabilities and assets recognized in the consolidated balance sheet

45,794(16,383)¥   29,411

42,519(40,109)¥   2,410

416,314(148,934)$    267,380

Funded retirement benefit obligation
Plan assets at fair value

Note: Pension plans accounted for by a simplified method are included.

(5) The components of retirement benefit expenses for the years ended March 31, 2019 and 2018 were as follows:
Millions of yen

Service cost
Interest cost
Expected return on plan assets
Amortization of actuarial loss
Amortization of prior service cost
Retirement benefit expenses calculated by simplified method
Difference arising from the change from simplified method to principle method
OthersRetirement benefit expenses

Thousands of
U.S. dollars (Note 3)

2019

2018

2019

¥ 3,202
2,488(2,166)
181
17
280
—
129
¥ 4,131¥ 3,183
2,566(2,187)
2,223
(422)
362
163
173
¥ 6,061$ 29,115
22,621(19,698)
1,654
158
2,551
—
1,160
$ 37,560(6) The components of remeasurements of defined benefit plans included in other comprehensive income (before tax effect) for theyears ended March 31, 2019 and 2018 were as follows:
Thousands of
U.S. dollars (Note 3)

Millions of yen

Prior service cost
Actuarial gain and loss
Total

2019

2018

2019

¥  (17)
1,575¥1,558¥   127(3,421)¥(3,294)$  (159)
14,323$14,164(7) The components of remeasurements of defined benefit plans included in accumulated other comprehensive income(before tax effect) as of March 31, 2019 and 2018 were as follows:

Thousands of
U.S. dollars (Note 3)

Millions of yen

Unrecognized prior service cost
Unrecognized actuarial gain and loss
Total

2019

2018

2019

¥(6,078)
7,516¥ 1,438¥(6,060)
5,941¥   (119)$(55,256)
68,338$ 13,082(8) The breakdown of plan assets by major category as of March 31, 2019 and 2018 were as follows:
Debt securities
Deposit
Equity securities
General accounts at life insurance companies
Others
Total

2019

2018

40%
25
15
18
2
100%

36%
35
15
13
1
100%

Note: R etirement benefit trust established for the corporate pension plans is included and equivalent to 9% of total amount of plan assets as of March 31, 2019 and 22% of total amountof plan assets as of March 31, 2018.

The long-term expected rates of return on plan assets has been determined as a result of consideration of both the portfolio allocation
at present and in the future, and long-term rates of return from multiple plan assets at present and in the future.
(9) The assumptions used in accounting for the defined benefit plans as of March 31, 2019 and 2018 were as follows:
Discount rates
Long-term expected rates of return on plan assets
Expected rates of salary increase

27 Fuji Electric Report Financials 2019

2019

2018

0.27% – 1.40%
mainly 2.0%
2.5% – 8.6%

0.27% – 1.40%
mainly 2.0%
2.5% – 8.6%

3. Information on Defined Contribution Pension Plans
Contributions of defined contribution pension plans for the years ended March 31, 2019 and 2018 were ¥4,708 million ($42,808 thousand)and ¥4,584 million, respectively.

4. Information on Multi-Employer Pension Plans
Contributions to multi-employer welfare pension plans accounted for by the same methods used for defined contributions plans for theyears ended March 31, 2019 and 2018 were ¥14 million ($136 thousand) and ¥14 million, respectively.

Note 12. Shareholders’ Equity
1. Shares Issued and Outstanding / Treasury Stock
The Companies Act of Japan provides that an amount equal to 10% of the amount to be disbursed as distributions of capital surplus(other than the capital reserve) and retained earnings (other than the legal reserve) be transferred to the capital reserve and the legal reserve,
respectively, until the sum of the capital reserve and the legal reserve equals 25% of the capital stock account. Such distributions can bemade at any time by resolution of the shareholders or by the Board of Directors if certain conditions are met.
Movements in shares outstanding and treasury stock during the years ended March 31, 2019 and 2018 were as follows:
Thousands of shares
March 31, 2018

Shares outstanding:Common stock
Total
Treasury stock:
Common stock
Total

Increasein the year

Decreasein the year

March 31, 2019

746,484
746,484——

597,188597,188

149,296
149,296

32,21532,21519
19

25,78325,783

6,451
6,451

Thousands of shares
March 31, 2017

Shares outstanding:Common stock
Total
Treasury stock:
Common stock
Total

Increasein the year

Decreasein the year

March 31, 2018

746,484
746,484————

746,484
746,484

32,15832,15857
57

0
032,21532,215

Notes: 1. Fuji Electric conducted an 1-for-5 common stock consolidation effective October 1, 2018.
2. The decrease of shares outstanding of common stock amounted to 597,188 thousand is due to stock consolidation.
3.	The increase of treasury stock of common stock amounted to 19 thousand consist of the increase amounted to 2 thousand due to purchase of fractions less than a share as aresult of the stock consolidation, and the increase amounted to 17 thousand (Before the stock consolidation: 13 thousand, after stock consolidation: 3 thousand) due to purchase of shares of less than a share trading unit associated with the stock consolidation.
4.	The decrease of treasury stock of common stock amounted to 25,783 thousand consist of the stock consolidation amounted to 25,782 thousand and the sales of shares ofless than a share trading unit amounted to 1 thousand (Before the stock consolidation: 0 thousand, after stock consolidation: 0 thousand).

2. Dividends(1) Dividends paid
For the year ended March 31, 2019
Total dividends
Total dividends (thousands of U.S.
Type of shares (millions of yen) dollars (Note 3))

Resolution

Meeting of the Board of
Directors on May 24, 2018
Meeting of the Board of
Directors on October 25, 2018

Commonstock
Commonstock

Dividends
per share(yen)

Dividends per share(U.S. dollars (Note 3))

Cut-off date

Effective date

¥5,714$51,947

¥8.0

$0.07

March 31, 2018

June 6, 2018

5,714

51,9478.0

0.07

September 30,
2018

December 4,
2018

Dividends per share (yen)Cut-off date

Effective date

¥6.0

March 31, 2017

June 7, 2017

6.0

September 30,
2017

December 5,
2017

For the year ended March 31, 2018
Total dividends
Type of shares (millions of yen)

Resolution

Meeting of the Board of
Directors on May 25, 2017
Meeting of the Board of
Directors on October 26, 2017

Commonstock
Commonstock¥4,2854,285(2) Dividends with the cut-off date in the year ended March 31, 2019 and effective date in the year ending March 31, 2020
Resolution

Meeting of the Board of
Directors on May 23, 2019

Total dividends
Type of shares (millions of yen)

Commonstock¥5,713

Total dividends(thousands of U.S.
dollars (Note 3))$51,944

Source ofdividends

Retainedearnings

Dividends
per share(yen)

Dividends
per share (U.S.
dollars (Note 3))

¥40.0

$0.36

Cut-off date

Effective date

March 31,2019

June 5,
2019

Dividends with the cut-off date in the year ended March 31, 2018 and effective date in the year ended March 31, 2019
Resolution

Total dividends
Type of shares (millions of yen)

Meeting of the Board of
CommonDirectors on May 24, 2018stock

¥5,714

Source of dividends

Retained earnings

Dividends per share (yen)Cut-off date

Effective date

¥8.0

March 31,2018

June 6,2018

Fuji Electric Report Financials 201928

Note 13. Research and Development Costs
Research and development costs charged to income were ¥33,669 million ($306,087 thousand) and ¥35,620 million for the years ended
March 31, 2019 and 2018, respectively.
Millions of yen

Research and development costs

Thousands of
U.S. dollars (Note 3)

2019

2018

2019

¥33,669¥35,620$306,087

Note 14. Selling, General and Administrative Expenses
Major components of selling, general and administrative expenses for the years ended March 31, 2019 and 2018 were as follows:
Millions of yen

Salaries and wages
Retirement benefit expenses
Research and development costs

Thousands of
U.S. dollars (Note 3)

2019

2018

2019

¥79,830
3,974
29,581¥77,637
4,607
30,796$725,731
36,134
268,920

Note 15. Extraordinary Income, Net
Extraordinary income, net, for the years ended March 31, 2019 and 2018 were as follows:
Millions of yen

Thousands of
U.S. dollars (Note 3)

2019

2018

2019

Extraordinary income
Gain on sales of noncurrent assets
Gain on sales of investment securities
Foreign currency transtation adjustment reversal gains¥    96
1,055
1,299

¥   2091,691—$    876
9,594
11,813Extraordinary loss
Loss on disposal of noncurrent assets
Loss on devaluation of investment securities
Impairment loss
Extraordinary income (loss), net(1,121)(279)(2,242)¥(1,192)

(366)
(776)
—
¥   758(10,194)(2,543)(20,383)$(10,837)

Note 16. Impairment Loss
The Companies determine the asset group by considering the categories of management accounting.
For the year ended March 31, 2019, the Companies recognized an impairment loss on the following asset groups:
Usage

Location

Classification

Millions of yen

Thousands of
U.S. dollars (Note 3)—
Assets to be disposed

United States of America
Tokyo

Goodwill and intangible assets
Buildings and other assets¥ 1,540¥   572$14,005$ 5,207

Assets to be disposed

Kanagawa Prefecture

Construction in progress¥    94$   855

Assets to be disposed

Chiba Prefecture

Buildings and other assets¥    36$   316

Regarding above Goodwill and intangible assets, the Companies recognized an impairment loss on goodwill and intangible assets as an
extraordinary loss up to the recoverable amount of the asset groups as a result of having examined the possibility of future recovery basedon the current business environment of a consolidated subsidiary in power generation business.
The impairment loss consisted of ¥1,243 million ($11,309 thousand) for goodwill and ¥297 million ($2,696 thousand) for intangible assets.
The value-in-use was measured using discounting future cash flows at a rate of 11.3%.
Regarding the asset to be disposed, the Companies recognized an impairment loss up to the recoverable amount of assets to be disposedas they are not expected to be used.
The impairment loss consisted of ¥606 million ($5,513 thousand) for buildings and structures, ¥94 million ($855 thousand) for constructionin progress and ¥1million ($10 thousand) for other assets.
The recoverable amount of the above assets was measured by the net realizable value.
The net realizable value was measured as zero for the assets because it seems difficult to sell or convert to other use.

29 Fuji Electric Report Financials 2019

Note 17. Income Taxes
1. The Components of Income Taxes for the Years Ended March 31, 2019 and 2018 were as Follows:
Thousands of
U.S. dollars (Note 3)

Millions of yen

Current
DeferredIncome taxes

2019

2018

2019

¥16,051
1,166¥17,217¥13,738
1,066¥14,804$145,920
10,597$156,517

The Company and its domestic consolidated subsidiaries are subject to corporate income tax, prefectural and municipal inhabitants’ taxes
and enterprise tax, based on income.

2. The Significant Components of Deferred Tax Assets and Liabilities as of March 31, 2019 and 2018 were as Follows:
Thousands of
U.S. dollars (Note 3)

Millions of yen

Deferred tax assets
Net defined benefit liability
The investment deduction of the foreign consolidated subsidiaries
Inventories
Accrued employees’ bonuses
Investment securities
Tangible fixed assets
Other
Gross deferred tax assets
Less: Valuation allowance
Total deferred tax assets
Deferred tax liabilities
Unrealized gain on other securities
Investment securities
Other
Gross deferred tax liabilities
Net deferred tax assets (liabilities)

2019

2018

2019

¥ 21,609
13,668
7,596
6,860
6,366
2,185
7,259
65,543(21,554)
43,989¥ 21,688
14,216
7,487
6,584
6,353
2,112
6,547
64,987(21,822)
43,165$ 196,447
124,262
69,06162,36957,876
19,87265,961595,848(195,945)
399,903(19,700)(2,451)(5,488)(27,639)¥ 16,350(21,095)(2,062)(4,852)(28,009)¥ 15,156(179,096)(22,284)(49,880)(251,260)$ 148,643

3. The Reconciliation Between the Statutory Income Tax Rate and the Effective Income Tax Rate for the Years Ended
March 31, 2019 and 2018 were as Follows:
Statutory income tax rate
Tax credits
Tax rate difference of overseas consolidated subsidiaries
Valuation allowance
Permanent difference resulting from non-taxable income, including dividends received
Permanent difference resulting from expenses not deductible for income tax purposes
Other
Effective income tax rate

2019

2018

30.6 %
(3.6)
(2.8)
(0.1)
(0.4)
2.0
1.9
27.6 %

30.9 %
(3.2)
(2.1)
(1.9)
(0.3)
1.4
1.3
26.1 %

Fuji Electric Report Financials 201930

Note 18. Consolidated Statements of Comprehensive Income
Amounts reclassified to profit (loss) in the current period that were recognized in other comprehensive income in the current or previous
periods and the tax effects for each component of other comprehensive income were as follows:
Thousands of
U.S. dollars (Note 3)

Millions of yen

Valuation difference on available-for-sale securities:
Amount arising during the year
Reclassification adjustments
Before tax effectTax effect
Valuation difference on available-for-sale securities
Deferred gains or losses on hedges:
Amount arising during the year
Before tax effectTax effect
Deferred gains or losses on hedges
Foreign currency translation adjustments:
Amount arising during the year
Reclassification adjustments
Before tax effectTax effectForeign currency translation adjustments
Remeasurements of defined benefit plans:
Amount arising during the year
Reclassification adjustments
Before tax effectTax effectRemeasurements of defined benefit plans
Share of other comprehensive income of associates accounted for using equity method:Amount arising during the year
Reclassification adjustments
Share of other comprehensive income of associates accounted forusing equity method
Total other comprehensive income

2019

2018

¥(4,246)(931)(5,177)
1,395(3,782)¥ 8,952(1,690)7,262(2,169)5,093$(38,603)(8,466)(47,069)
12,686(34,383)

(532)
(532)
163
(369)

2,312
2,312
(624)
1,688

(4,839)(4,839)1,481(3,358)(443)(1,300)(1,743)382(1,361)

1,600
—
1,600
—
1,600

(4,034)(11,813)(15,847)3,489(12,358)(1,757)199(1,558)452(1,106)

1,492
1,802
3,294
(993)
2,301

(15,976)
1,812(14,164)
4,101(10,063)

68
133

31
140

624
1,204

201

171

1,828

¥(6,417)¥10,853$(58,334)

2019

Note 19. Contingent Liabilities
Contingent liabilities as of March 31, 2019 and 2018 were as follows:
Millions of yen

Guarantees

31 Fuji Electric Report Financials 2019

Thousands of
U.S. dollars (Note 3)

2019

2018

2019

¥15,169¥14,396$137,900

Note 20. Leases
1. Finance Lease Transactions(1) Leased assets
Leased assets primarily consist of machinery and equipment and software.
(2) Depreciation method for leased assets
Depreciation method for leased assets is as stated in “f. Depreciation, 2) Leased assets” in “Note 2. Summary of Significant Accounting Policies”.
In addition, finance leases other than those that were deemed to transfer the ownership of the leased assets to the lessees andcontracted before April 1, 2008, are accounted for by the method that is applicable to ordinary operating leases.
Pro forma information of those leased property such as acquisition cost, accumulated depreciation, accumulated impairment loss,
obligations under finance leases, lease expense, depreciation expense, interest expense and impairment loss on an “as if capitalized” basis
for the years ended March 31, 2019 and 2018 were as follows:(a) Acquisition cost and accumulated depreciation under finance leases:
Thousands of
U.S. dollars (Note 3)

Millions of yen

Acquisition cost
Accumulated depreciation
Net leased property

2019

2018

2019

¥1,103
1,029¥   74¥1,433
1,277¥   156$10,0319,354$   677(b) Obligations under finance leases:
Thousands of
U.S. dollars (Note 3)

Millions of yen

2019

Due within one year
Due after one year
Total

2018

¥ 93
115
¥208

¥ 83
31
¥114

2019

$   760277$1,037(c) Lease expense, depreciation expense and interest expense under finance leases:
Thousands of
U.S. dollars (Note 3)

Millions of yen

2019

Lease expense
Depreciation expense
Interest expense

2018

¥127
96
8

¥98
82
5

2019

$899
748
46

(d) Method of calculating estimated depreciation expense
Depreciation is computed by the straight-line method over the lease period assuming no residual value.
(e) Method of calculating estimated interest expense
Interest expense is computed and allocated to each period using the interest method assuming interest expense to be the excess of totallease payments over the acquisition cost.

2. Operating lease transactions
The minimum rental commitments under noncancellable operating leases as of March 31, 2019 and 2018 were as follows:
Thousands of
U.S. dollars (Note 3)

Millions of yen

Due within one year
Due after one year
Total

2019

2018

2019

¥2,244
1,518¥3,762¥2,1053,024¥5,129$20,407
13,796$34,203

Fuji Electric Report Financials 201932

Note 21. Segment Information
1. Segment Information(1) Outline of reporting segments
The Companies’ reporting segments are components for which
separate financial information is available and whose operating
results are reviewed regularly by the Board of Directors of theCompany in order to make decisions about resource allocation andto assess performance. The Company has business headquarters
by products and services at its head office. The business headquarters prepare comprehensively global strategies related to theirproducts and services and control their business activities.
Accordingly, the Companies have five reporting segments,
principally based on the business headquarters, that take into
account the similarity of category and nature of products andservices: Power Electronics Systems—Energy Solutions, PowerElectronics Systems—Industry Solutions, Power and New Energy,
Electronic Devices and Food and Beverage Distribution. Thesesegments except for Electronic Devices and Food and Beverage
Distribution consist of 2 or more business segments.
As of April 1, 2018, reflecting change of organization structure,business segments in the reporting segments of Power Electronics
Systems—Energy Solutions and Power Electronics Systems—
Industry Solutions were reclassified. The reporting segment information for the year ended March 31, 2018 has been reclassified toreflect this change.

Main products and services of each reporting segment consisted of the following:
Reporting segments

Main products and services

Power Electronics Systems—Energy Solutions

Power distribution, smart meters, industrial substation, railway substation, industrial power supplies,
datacenters, uninterruptible power systems (UPSs), electrical facilities, switchboards, power distribution
and control equipment

Power Electronics Systems—Industry Solutions

Inverters, motors, FA components (servos/controllers), measuring instruments and sensors, FA systems,
drive control systems, measuring and control systems, transport systems, radiation monitoring systems,
electricity and air conditioning equipment construction, information systems

Power and New Energy

Thermal / biomass /geothermal / hydro power generation facilities, solar power generation systems, wind
power generation systems, fuel cells

Electronic Devices

Power semiconductors, magnetic disks

Food and Beverage Distribution

Beverage vending machines, vending machines for food and other goods, showcases, automaticchange dispensers, eco-friendly stores(2) Calculation method of net sales, profit or loss, assets, liabilities and other items on each reporting segment
The accounting policies applied by each reporting segment are consistent with those described in “Note 2. Summary of Significant
Accounting Policies”. Segment profit or loss presented in segment information is calculated based on operating income in the consolidated
statements of income. Intersegment sales and transfers are determined by market value.
(3) Information on net sales, profit or loss, assets, liabilities and other items by each reporting segment
Reporting segment information as of March 31, 2019 and 2018 and for the years then ended were as follows:
Millions of yen
PowerElectronics
Systems—
EnergySolutions

PowerElectronics
Systems—
Industry
SolutionsPower and New
EnergyElectronic
Devices

Food andBeverageDistribution

OthersSales to third parties
Inter-segment sales andtransfers¥220,409¥308,921¥106,921¥133,828¥113,345¥31,491

4,378

13,021

91

3,506

261

30,74051,997(51,997)—

Total sales

224,787

321,942

107,012137,334

113,606

62,231

966,912(51,997)

914,915

Year ended March 31, 2019

Total

Adjustments

Consolidated¥914,915¥     —

¥914,915

Sales, profits or losses andassets by reporting
segments
Net sales

Segment profits (losses)¥ 16,854¥ 19,393¥  4,750¥ 15,623¥  5,756¥ 2,766¥ 65,142¥ (5,170)¥ 59,972

Segment assets¥204,632¥263,922¥116,166¥172,699¥ 78,733¥33,962¥870,114¥ 82,545¥952,659¥  5,668¥  6,267¥  1,367¥ 13,168¥  2,498¥   874¥ 29,842¥  1,064¥ 30,906

Other items
Depreciation and amortization
Investments for companies
applied equity method¥ 14,828¥  1,426¥      —

¥      —

¥      —

¥     —

¥ 16,254¥      —

¥ 16,254

Capital expenditures¥  6,443¥  7,006¥  1,193¥ 20,451¥  2,647¥   929¥ 38,669¥   869¥ 39,538

33 Fuji Electric Report Financials 2019

Millions of yen
PowerElectronics
Systems—
EnergySolutions

PowerElectronics
Systems—
Industry
SolutionsPower and New
EnergyElectronic
Devices

Food andBeverageDistribution

OthersSales to third parties
Inter-segment sales andtransfers¥214,450¥310,165¥ 96,757¥123,502¥117,485¥31,092

3,165

10,815

122

3,369

268

29,31347,052(47,052)—

Total sales

217,615

320,980

96,879126,871

117,753

60,405940,503(47,052)

893,451

Year ended March 31, 2018

Total

Adjustments

Consolidated¥893,451¥      —

¥893,451

Sales, profits or losses andassets by reporting
segments
Net sales

Segment profits (losses)¥ 14,015¥ 18,920¥  5,521¥ 13,699¥  6,234¥ 2,861¥ 61,250¥   (5,288)¥ 55,962

Segment assets¥187,996¥255,618¥113,246¥150,783¥ 80,191¥32,062¥819,896¥ 94,848¥914,744¥  5,726¥  6,126¥  1,444¥ 12,882¥  2,271¥   808¥ 29,257¥    894¥ 30,151

Other items
Depreciation and amortization
Investments for companies
applied equity method¥ 13,802¥  1,318¥      —

¥      —

¥      —

¥     —

¥ 15,120¥      —

¥ 15,120

Capital expenditures¥  6,470¥  4,960¥  1,335¥ 10,614¥  5,081¥   641¥ 29,101¥   1,347¥ 30,448

Year ended March 31, 2019

Power
Electronics
Systems—
EnergySolutions

PowerElectronics
Systems—
Industry
SolutionsPower and New
EnergyElectronic
Devices

Food andBeverageDistribution

Total

Adjustments

Consolidated

Sales to third parties
Inter-segment sales andtransfers$2,003,719$2,808,378$  972,018$1,216,622$1,030,416

39,804

118,376826

31,8742,370

279,457

472,707(472,707)—

Total sales

2,043,523

2,926,754

972,844

1,248,496

1,032,786

565,718

8,790,121(472,707)

8,317,414

Thousands of U.S. dollars (Note 3)

OthersSales, profits or losses andassets by reporting
segments
Net sales$286,261 $8,317,414$      — $8,317,414

Segment profits (losses)$  153,220$  176,301$   43,186$  142,031$   52,334$ 25,139 $  592,211$ (47,008) $  545,203

Segment assets$1,860,298$2,399,298$1,056,062$1,570,000$  715,759$308,713 $7,910,130$ 750,415 $8,660,545$   51,528$   56,981$   12,432$  119,717$   22,715$  7,914 $  271,287$   9,678 $  280,965

Other items
Depreciation and amortization
Investments for companies
applied equity method$  134,803$   12,969$       —

$       —

$       —

$       — $  147,772$         — $  147,772

Capital expenditures$   58,577$   63,695$   10,852$  185,919$   24,064$  8,430 $  351,537$   7,901 $  359,438

Notes: 1.	Others segment consisted of business segments not attributable to reporting segments and included financial services, real estate operations, insurance agency services, travel
agency services, printing and information services, etc.
2. The adjustments for segment information above were as follows:
Thousands of
U.S. dollars(Note 3)

Millions of yen

Corporate expense*

2019

2018

2019

¥(5,187)¥(5,287)$(47,163)

Elimination of intersegment sales
Total

17

(1)

155

¥(5,170)¥(5,288)$(47,008)

	* Corporate expense mainly consisted of administration cost of the Company.
Thousands of
U.S. dollars(Note 3)

Millions of yen

Corporate assets*
Elimination of intersegment transactions
Total

2019

2018

2019

¥ 262,857¥ 266,495$ 2,389,609(180,312)(171,647)(1,639,194)¥   82,545¥   94,848$   750,415	* Corporate assets mainly consisted of invested cash surpluses (cash and cash equivalents), long-term invested assets(investment securities), assets relating to administration department and assets of a financing subsidiary company.
3. Segment profits (losses) were reconciled to operating income (loss) in the consolidated statements of income.

Fuji Electric Report Financials 201934

2. Related Information
Related information as of March 31, 2019 and 2018 and for the years then ended were as follows:
Geographic information(a) Sales
Thousands of
U.S. dollars (Note 3)

Millions of yen

Japan
Asia (except for China), Others
China
EuropeAmerica
Consolidated

2019

2018

2019

¥682,503
121,733
78,36816,477
15,834¥914,915¥674,744
110,935
74,96817,584
15,220¥893,451$6,204,573
1,106,649
712,445
149,799
143,948$8,317,414

Note: Net sales information above is based on customer location.

(b) Tangible fixed assets
Thousands of
U.S. dollars (Note 3)

Millions of yen

Japan
Asia (except for China), Others
China
EuropeAmerica
Consolidated

2019

2018

2019

¥141,585
24,90014,354660
625¥182,124¥136,205
22,342
14,597782
674¥174,600$1,287,141
226,341
130,500
6,008
5,685$1,655,675

3. Information on Impairment Loss of Fixed Assets by Each Reporting Segment
Information on impairment loss of fixed assets by each reporting segment for the years ended March 31, 2019 and 2018 were as follows:
Thousands of
U.S. dollars (Note 3)

Millions of yen

2019Power Electronics Systems—Energy Solutions
Power Electronics Systems—Industry Solutions
Power and New Energy
Electronic Devices
Food and Beverage Distribution
OthersTotal

35 Fuji Electric Report Financials 2019¥   34
572
1,636
—
—
—
¥2,242

2018

¥—
—
—
—
—
—
¥—

2019

$   315
5,207
14,861———$20,383

4. Information on Amortization of Goodwill and Unamortized Balance by Each Reporting Segment
Information on amortization of goodwill and unamortized balance by each reporting segment for the year ended March 31, 2019 and2018 were as follows:
Millions of yen

Year ended March 31, 2019

Power
Electronics
Systems—
EnergySolutions

PowerElectronics
Systems—
Industry
Solutions

Amortization
Balance as of March 31

¥292
¥292

¥134
¥580

Year ended March 31, 2018

Power
Electronics
Systems—
EnergySolutions

PowerElectronics
Systems—
Industry
Solutions

Amortization
Balance as of March 31

¥308
¥612

¥ 9
¥79

Year ended March 31, 2019

Power
Electronics
Systems—
EnergySolutions

PowerElectronics
Systems—
Industry
SolutionsPower and New
EnergyElectronic
Devices

Amortization
Balance as of March 31$2,661$2,661$1,221$5,279$1,696
$   —

$ 90
$576

Power and New
EnergyElectronic
Devices

¥186
¥  —

¥11
¥64

Food and Beverage
Distribution¥—¥—

OthersConsolidated

¥—
¥—

¥623
¥936

OthersConsolidated¥—¥—¥   529¥2,217

OthersConsolidated$—$—$5,668$8,516

Millions of yen

Power and New
EnergyElectronic
Devices¥   189¥1,456¥23¥70

Food and Beverage
Distribution¥—¥—

Thousands of U.S. dollars (Note 3)

Food and Beverage
Distribution$—$—

5. Information on Gain on Negative Goodwill by Each Reporting Segment
None

Note 22. Information on Transactions with Related Parties
For the year ended March 31, 2019
None

Note 23. Business Combinations
For the year ended March 31, 2019
This disclosure is omitted due to the immateriality.

Note 24. Asset Retirement Obligations
Asset Retirement Obligations Recorded on the Consolidated Balance Sheets
1. Outline of Asset Retirement Obligations
The Companies record asset retirement obligations related to the expenses for removing asbestos from company-owned buildings upon
their dismantlement and the obligations to restore head offices, sales offices and other premises to their original condition upon terminationof their lease contracts.
Regarding some of the obligations to restore head offices, sales offices and other premises to their original condition, the Companies
estimate nonrecoverable amounts of deposits for those premises and record the portion attributable to the current year as expenses,
instead of recording asset retirement obligations.

2. Calculation Method of Asset Retirement Obligations
In calculating the amounts of asset retirement obligations, the Companies estimate a period of use between 12 and 49 years and use a
discount rate equivalent to the interest rate of government bonds corresponding to the use period (0.3% to 2.3%).

Fuji Electric Report Financials 201936

3. Changes in the Total Amounts of Asset Retirement Obligations
Changes in the total amounts of asset retirement obligations for the years ended March 31, 2019 and 2018 were as follows:
Millions of yen

Balance at the beginning of the year
Increase due to acquisition of property, plant and equipment
Adjustment due to passage of time
Decrease due to fulfillment of obligations
Balance at the end of the year

Thousands of
U.S. dollars (Note 3)

2019

2018

2019

¥1,9313
6(22)¥1,918¥1,986—8(63)¥1,931$17,55732
60(206)$17,443

Note 25. Amounts Per ShareInformation of amounts per share as of March 31, 2019 and 2018 and for the years then ended were as follows:Yen

Net assets per share
Net income per share

U.S. dollars (Note 3)

2019

2018

¥2,470.65
281.89¥2,314.50
264.342019$22.460
2.563

Diluted net income per share in 2019 and 2018 are not disclosed because there is no potential common stock that has a dilutive effect.
Fuji Electric conducted an 1-for-5 common stock consolidation effective October 1, 2018.
Net assets per share and Net income per share are calculated assuming that the share consolidation was executed at the beginning of
the year ended March 31, 2018.

Note 26. Subsequent Events(The Acquisition of Company through the Acquisition of Shares)
The Company has adopted a resolution to acquire the entire shares of Consul Neowatt Power Solutions Private Limited (CNPS) and to makethe CNPS its subsidiary at a meeting of its Board of Directors held on June 20, 2019.
(1) Purpose of the acquisition
CNPS is a leading manufacturer of power supply equipment in India.
Uninterruptible power systems (UPSs), which is the CNPS’s main product, is winning the first place of the domestic market share in the country.
CNPS is also achieving many business results of sales to manufacturing, medical and social infrastructure industries etc. in India.
The company is expanding its power electronics systems business in India through obtaining CNPS’s price competitive products,
manufacturing bases and sales and service bases which are locating throughout India mainly targeting on markets of manufacturers anddata centers, which is active in recent years.
(2) Share transferees
Peepul Capital Fund III LLC, management of CNPS and other individual shareholders(3) Acquired company, description and size of the businessa. A cquired company
Consul Neowatt Power Solutions Private Limitedb. Description of the business
Development, manufacturing, engineering, sales, and services of UPSs, servo voltage stabilizers, active harmonic filters, off-grid solar
inverters and other customized power electronic solutions.
c. B
 usiness size
Gross asset: 3,123 million Indian Rupee, Sales amount: 4,168 million Indian Rupee(4) Acquisition schedule
End of August 2019 (planned)(5) Number of shares to be acquired, Acquisition price and Shareholding ratio after the acquisitiona. Number of shares to be acquired: 177,569 sharesb. Acquisition price: 10,550 million yen (estimated amount (*))
c. Shareholding ratio after the acquisition: 100%(*) Note: T he acquisition price above is estimated based on the CNPS’s financial information at the end of March, 2019. Final acquisition price may be adjusted since it will be determinedbased on the actual value as at point in time of the share transfer.

37 Fuji Electric Report Financials 2019

Independent Auditor’s Report

Fuji Electric Report Financials 201938

Gate City Ohsaki, East Tower,
11-2, Osaki 1-chome, Shinagawa-ku, Tokyo 141-0032, Japan
Contacts: Public and Investor Relations Dept.
TEL: +81-3-5435-7111 www.fujielectric.com/

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