Message from the Management

SOUND MANAGEMENT PLAN
Following the announcement of its Sound Management Plan in March 2000, Ryobi Limited has madeCompanywide efforts to fulfill its objectives. Througha sweeping review that considers curtailing and withdrawing from unprofitable businesses, the plan aims
to build a stable, high earnings structure by concentrating management resources to the fullest extent
possible in such fields of expertise as die casting andprinting equipment. The efforts and direction of eachbusiness, and status of the Sound Management Plan
are as follows:1) Die casting businessIn the die casting business, Ryobi aims to strengthen
and expand relationships with automobile manufacturers by utilizing our know-how as a world-leading
die casting manufacturer and our three-region structure of Japan, the United States and Europe. In addition, we have worked aggressively to expand sales insuch non-automobile fields as electronics and communications, and aluminum die casting products are
attracting attention from various fields for their lightweight and superior recyclability.
2) Printing equipment business
The Company is bolstering new product development,
manufacturing capacity and sales capabilities to further reinforce its solid reputation in world markets
by advancing high-precision multicolor and functions.
By responding to advancements in information technology and digitization, as well as by expanding fromsmall-size to medium-size printing presses, we are developing a total printing system from prepress to press.
3) Power tools business(1) In the power tools business, the Company is con-

1

RYOBI LIMITED SEMIANNUAL REPORT 2001

ducting a sweeping review, including the sale of businesses.
a) We sold the power tools business of four companies in North America and the sales business of twosales companies in Europe to TechTronic Industries
Co., Ltd. (Hong Kong). Moreover, the lawn and garden equipment business of four companies in North
America was sold to MTD Products Inc (U.S.A.).
b) We have decided to sell two sales companies inOceania to a third party, and are proceeding with negotiations.
c) In the domestic power tools business, the Company
is proceeding to strengthen cross-sectional management of the Group while streamlining the organization, reducing personnel and unifying and eliminating models to improve profitability and strengthencompetitiveness. In particular, we are building a costcompetitive manufacturing structure through suchefforts as accelerating the transfer of production to a
subsidiary in Dalian, China.
(2) In the builders’ hardware business, the Company
is strengthening competitiveness by transferring production of such mainstay products as door closers toa manufacturing subsidiary in Dalian, China. We arealso focusing efforts on the development and sale ofproducts for new fields.

PERFORMANCE
During the six months ended 30th September 2001,
consolidated net sales fell 19.4% to ¥79,943 million,with domestic net sales down 11.0% to ¥52,295 million and overseas net sales declining 31.6% to ¥27,648
million, compared with the same period of the previous fiscal year.

Operating income totaled ¥3,135 million, a decrease of 52.8% from a year earlier. Net income wasrestored to ¥815 million, compared with a net loss of¥410 million in the same period of the previous fiscalyear. The fall in net sales was primarily due to a decline in sales of the domestic die casting business, andthe sale of the lawn and garden equipment businessin North America and the fishing tackle business.
By segment, sales of the die casting business weredown 5.5% to ¥50,373 million. Operating income
dropped 41.6% to ¥2,756 million, resulting in a ratioof operating income to net sales of 5.5%, a decline of
3.4 percentage points for the segment. Primary factors behind these declines were lower sales in the coreautomobile field and fewer sales in the electronics andcommunications field due to slower demand in ITrelated fields. In particular, exports of domestic automobile manufacturers were favorable to North
America and Asia in the same period of the previous
fiscal year, making a considerable difference with results this term.
Sales of the printing equipment business slipped
0.3% to ¥11,638 million. Operating income fell 53.1%
to ¥247 million, and the ratio of operating income tonet sales decreased 2.4 percentage points to 2.1%. On
top of no growth in sales in Japan and overseas, increased sales competition in the market applied downward pressure on profits. Despite these results, thenew digital offset press RYOBI 3404DI won the Distinctive Merit Award in the 31st Machinery and Industrial Design Awards, after the RYOBI 680 Series ofmedium-size offset presses won the Minister of International Trade and Industry Award in the Machineryand Industrial Design Awards.

Sales of the power tools business amounted to¥17,023 million, a decline of 46.9% from the same
period a year earlier. Operating income plummeted
81.6% to ¥325 million for a ratio of operating income
to net sales of 1.9%, compared with 5.5% a year earlier. Most of this decrease is attributable to the sale ofthe lawn and garden equipment business in the same
period of the previous fiscal year.
Sales of other business totaled ¥909 million, a fallof 56.4%. An operating loss of ¥196 million was posted,
an improvement from the operating loss of ¥372 million a year earlier. The change in sales and operating
loss was due to the sale of the fishing tackle businessin the same period of the previous fiscal year.
We expect the economies of Japan and the world
to weaken as a result of the terrorist attacks in theUnited States. Furthermore, the operating environment is changing at speeds beyond expectation. Despite these difficult conditions, Ryobi is focusing efforts on optimizing business scale, reinforcing thestructure of each of its businesses and improving performance based on its Sound Management Plan.
Ryobi will make every effort to be a “Sound andDynamic Corporation” to meet the expectations ofits shareholders, customers and business associates.
Thank you for your continued support.
December 2001

Hiroshi Urakami
President

RYOBI LIMITED SEMIANNUAL REPORT 2001

2

Consolidated Balance Sheets
Ryobi Limited and Consolidated Subsidiaries (Unaudited)
Millions of Yen
30th September
31st March2001
2001

Thousands ofU.S. Dollars*
30th September
2001

ASSETS
Current assets
Cash and cash equivalents .............................................................
Time deposits ................................................................................
Notes and accounts receivable, less allowances ............................
Inventories .....................................................................................
Prepaid expenses and other ..........................................................
Total current assets ............................................................

¥ 15,535
2,767
39,523
33,6681,391
92,884¥ 18,669
2,561
46,88834,226
2,116
104,460$ 130,109
23,174331,013
281,977
11,650777,923

Net property, plant and equipment .................................................

59,996

60,953

502,479

9,261

10,922

77,563629
2,179
10,7833,560
26,412¥179,292

617
2,253
10,556
3,240
27,588¥193,001

5,268
18,25090,31029,815221,206$1,501,608¥ 31,577
28,591
34,108
6,249
101
771
7,027
108,424¥ 34,440
23,95940,088
7,909
133
1,810
7,428
115,767$ 264,464
239,456
285,662
52,337846
6,457
58,852
908,074

Long-term liabilities
Long-term debt .............................................................................
Accrued severance indemnities ....................................................
Other long-term liabilities .............................................................
Total long-term liabilities ...................................................

32,1194,582
3,490
40,191

39,5944,116
3,090
46,800269,00338,37529,230336,608

Minority interests .............................................................................

585

933

4,899

Shareholders’ equity
Common stock, par value ¥50 per share:
Authorised: 500,000,000 shares
Issued: 171,230,715 shares .........................................................
Additional paid-in capital ..............................................................
Deficits ...........................................................................................
Unrealised gain on available-for-sale securities ............................
Adjustments on foreign currency statement translation ..............
Treasury stock ................................................................................
Total shareholders’ equity .................................................
Total ..................................................................................

18,472
23,517(4,841)
1,399(8,390)(65)
30,092¥179,292

18,472
23,517(5,652)
2,229(9,001)(64)
29,501¥193,001

154,707
196,960(40,544)
11,717(70,268)(545)
252,027$1,501,608

Investments and other assets
Investments in securities ...............................................................
Investments in and advances to unconsolidated subsidiaries
and affiliates ..................................................................................
Intangible fixed assets ...................................................................
Deferred tax assets .........................................................................
Other .............................................................................................
Total investments and other assets ....................................
Total ..................................................................................
LIABILITIES AND SHAREHOLDERS’ EQUITYCurrent liabilities
Short-term borrowings ..................................................................
Current portion of long-term debt ...............................................
Notes and accounts payable ..........................................................
Accrued expenses ..........................................................................
Income taxes payable ....................................................................
Accrued loss on disposal of business segment ..............................
Other current liabilities .................................................................
Total current liabilities .......................................................

* U.S. dollar amounts in this report, solely for the convenience of the reader, are translated from yen at the rate of ¥119.40 = US$1, the exchange rate
prevailing on 30th September 2001.

3

RYOBI LIMITED SEMIANNUAL REPORT 2001

Consolidated Statements of Operations
Ryobi Limited and Consolidated Subsidiaries(Six months ended 30th September 2001 and 2000) (Unaudited)
Millions of Yen
30th September
30th September
2001
2000

Net sales ...........................................................................................
Cost of sales .....................................................................................
Gross profit .........................................................................
Selling, general and administrative expenses ..................................
Operating income ..............................................................
Other income
Interest and dividends ...................................................................
Gain on sales of investment securities ..........................................
Other .............................................................................................
Total other income ............................................................
Other expenses
Interest ...........................................................................................
Early retirement benefits ...............................................................
Loss on disposal of business segment ...........................................
Other .............................................................................................
Total other expenses ..........................................................
Income before income taxes and other items .................................
Income taxes ....................................................................................
Minority interests .............................................................................
Net income (loss) .............................................................................

Thousands ofU.S. Dollars*
30th September
2001¥ 79,943
64,477
15,466
12,331
3,135¥ 99,157
75,741
23,416
16,7766,640$ 669,539
540,008
129,531103,275
26,256

198
351
691
1,240

213
—
757
970

1,658
2,940
5,787
10,385

1,314
551
113
909
2,887
1,488
966
293
815

1,981
62
4,615
857
7,515
95
431
(74)
¥ (410)11,005
4,615
946
7,613
24,17912,462
8,090
2,454
6,826

¥

$Consolidated Statements of Cash Flows
Ryobi Limited and Consolidated Subsidiaries(Six months ended 30th September 2001 and 2000) (Unaudited)
Millions of Yen
30th September
30th September
2001
2000

Net cash provided by operating activities ........................................
Investing activities
Payments for purchase of property, plant and equipment ..........
Proceeds from sale of property, plant and equipment .................
Proceeds from sale of marketable securities .................................
Increase in deposit ........................................................................
Proceeds from sale of business segment .......................................
Payments for sale of business segment .........................................
Other, net ......................................................................................
Net cash provided by ( used in ) investing activities ........
Financing activitiesProceeds from long-term debt ......................................................
Repayments of long-term debt ......................................................
Decrease in short-term borrowings ...............................................
Other .............................................................................................
Net cash used in financing activities .................................
Effect of exchange rate changes on cash and cash equivalents ......
Net increase (decrease) in cash and cash equivalents .....................
Cash and cash equivalents at beginning of year ..............................
Cash and cash equivalents at end of year ........................................
Additional cash flow information
Interest paid ..................................................................................

Thousands of
U.S. Dollars*
30th September
2001

3,842

¥ 10,556(2,131)
370
553
(206)
731
(102)
(546)
(1,331)(3,506)328—(8,179)17,632
(874)
33
5,434

(17,848)
3,099
4,631
(1,725)
6,122(854)(4,572)(11,147)

2,000(5,004)(2,671)(181)(5,856)211(3,134)
18,669¥ 15,535

13,700(10,176)(11,843)(157)(8,476)(49)
7,465
23,082¥ 30,547

16,750(41,910)(22,370)(1,515)(49,045)
1,767(26,248)
156,357$ 130,109¥ (2,256)$¥¥ (1,413)$32,177

11,834

RYOBI LIMITED SEMIANNUAL REPORT 2001

4

Industry Segment Information(Six months ended 30th September 2001 and 2000)
Millions of Yen
2001
Power tools
OtherDie Castings

Printing equipment

Net sales
Unaffiliated customers ...............
Intersegment ..............................

¥50,373232¥11,638—¥17,0235¥ 909—

Eliminations

Consolidated¥ —(237)¥79,943—

Total ............................................

50,605

11,63817,028909(237)

79,943Operating costs and expenses .......

47,84911,391

16,703

1,105(240)

76,808Operating income (loss) ................

¥ 2,756¥¥ (196)3¥ 3,135

¥

247

325

Millions of Yen
2000
Power tools
OtherDie Castings

Printing equipment

Net sales
Unaffiliated customers ...............
Intersegment ..............................

¥53,317238¥11,676—¥32,08039

Total ............................................

53,555

11,67632,119Operating costs and expenses .......

48,834

Operating income (loss) ................

¥ 4,721¥¥

Eliminations

Consolidated¥2,084—¥ —(277)¥99,157—

2,084(277)99,157

11,15030,358

2,456

(281)

92,517526¥ 1,761¥ (372)¥¥ 6,640

4

Thousands of U.S. Dollars*
2001
Power tools
OtherEliminations

Consolidated

Die Castings

Printing equipment

Net sales
Unaffiliated customers ...............
Intersegment ..............................

$421,884
1,943$ 97,471—$142,571
42$ 7,613—$ —(1,985)$669,539—

Total ............................................

423,827

97,471

142,613

7,613(1,985)669,539

Operating costs and expenses .......

400,745

95,402

139,891

9,255(2,010)643,283

Operating income (loss) ................

$ 23,082$ 2,069$ 2,722$(1,642)$$ 26,256

5

RYOBI LIMITED SEMIANNUAL REPORT 2001

25Geographical Segment Information(Six months ended 30th September 2001 and 2000)

JapanNorth America

Millions of Yen
2001
Other overseas

Net sales
Unaffiliated customers ............
Intersegment ...........................

¥60,104
2,191¥ 10,764
2¥9,075
1,934

Total .........................................

62,295

10,766

11,009Operating costs and expenses ....

60,208Operating income .......................

¥ 2,087¥

10,521

10,410245¥ 599

JapanNorth America

Millions of Yen
2000
Other overseas

Net sales
Unaffiliated customers ............
Intersegment ...........................

¥ 66,919
2,686¥ 24,829850¥ 7,4092,449

Total .........................................

69,60525,679

9,858

Operating costs and expenses ....

65,44823,864

9,119

Operating income .......................

¥ 4,157¥ 1,815

¥ 739

Japan

Eliminations

Consolidated¥—(4,127)¥ 79,943—(4,127)

79,943(4,331)76,808204¥ 3,135

Eliminations

Consolidated¥—(5,985)¥ 99,157—(5,985)

99,157¥(5,914)92,517(71)¥ 6,640

North America

Thousands of U.S. Dollars*
2001
Other overseas

Eliminations

Consolidated$503,383
18,350$ 90,151
17$76,005
16,198$—(34,565)$669,539—521,733

90,16892,203(34,565)

669,539

Operating costs and expenses

504,254

88,11687,186(36,273)643,283

Operating income$ 17,479

2,052$ 5,017$ 1,708$ 26,256

Net sales
Unaffiliated customers
Intersegment
Total$¥

Export Sales and Sales by Overseas Subsidiaries(Six months ended 30th September 2001 and 2000)
Percentage
againstconsolidated
net sales

Thousands ofU.S. Dollars*Millions of Yen2001

2000

2001

2001

2000

North America ............................
Europe .........................................
Other ...........................................

¥13,927
9,433
4,288

¥27,757
8,543
4,093

$116,642
79,00335,913

17.4%
11.8
5.4

28.0%
8.6
4.1

Total .............................................

¥27,648¥40,393$231,558

34.6%

40.7%

RYOBI LIMITED SEMIANNUAL REPORT 2001

6

Company Outline
MAJOR PRODUCTS:• Die casting products• Printing equipment (offset printing presses, prepress systems, etc.)• Power tools (electric power tools, lawn and garden equipment, engine tools, etc.)• Builders’ hardware (door closers, hinges, etc.)• Sporting goods (golf equipment, etc.)
HEAD OFFICE, BRANCH:• HEAD OFFICE• TOKYO BRANCH• TOKYO BRANCHTORANOMON OFFICE

762, Mesaki-cho, Fuchu, Hiroshima 726-8628, Japan
Telephone: 81-847-41-1111
5-2-8, Toshima, Kita-ku, Tokyo 114-8518, Japan
Telephone: 81-3-3927-5541
Toranomon Central Building 4th Floor, 1-7-1 Nishi-Shinbashi, Minato-ku, Tokyo 105-0003, Japan
Telephone: 81-3-3501-0511

URL: http://www.ryobi-group.co.jp

Shareholder Information
1.

NUMBER OF SHARES ISSUED:
171,230,715 Shares

2.

LISTINGS
Common Stock—Tokyo, Osaka
Continental Depositary Receipts—Frankfurt

3.

TRANSFER AGENT:The Mitsubishi Trust and Banking Corporation
11-1, Nagata-cho 2-chome, Chiyoda-ku,
Tokyo 100-8212, Japan

4.

RELAYING OFFICES:
All domestic branches of The Mitsubishi Trust and Banking Corporation

PRINTED IN JAPAN©RYOBI LIMITED 2001