RYOBI LIMITEDSEMIANNUAL REPORT(Unaudited)
For the six months ended 30th September 2004

2004

A MESSAGE FROM THE MANAGEMENT
Guided by its corporate philosophy, “Create a sound and dynamic corporation through technology, trust andchallenge,” the Ryobi Group seeks to establish itself as an indispensable existence by responding to the needsof customers and society, through innovative, top-quality products and services.
At the same time, Ryobi has positioned corporate social responsibility as fundamental to its management
activities in an effort to create sustained corporate value and a better society. Corporate social responsibility
encompasses diverse responsibilities including the provision of useful products and services as well as theactive disclosure of information, compliance, risk management, activities that contribute to society and avariety of other initiatives. Based on its corporate philosophy, Ryobi strives to fulfill its corporate social responsibility—with the aims of growth and development—establish and implement management, compliance and risk management structures, and promote corporate governance tailored to its unique characteristics
as a company.
BUSINESS DEVELOPMENT
Ryobi has positioned improved competitiveness andenhanced earnings power as key management issues
and the driving force for sustained future growth anddevelopment. The Company continues to develop
technologies and provide products and services that
only Ryobi can deliver and is implementing a varietyof measures in each of its operations to further boost
market presence. Trends in business development foreach segment are as follows:
1) DIE CASTINGS
Ryobi aims to strengthen and expand relationships with
automobile manufacturers by utilizing our know-how
as a world-leading die casting manufacturer and ourtripolar global structure of Japan, the United States andEurope. Our aluminum die castings are lightweight,
have excellent durability and are superior in terms ofrecyclability. In addition to the automobile field, these
die castings have attracted attention in fields such as
electronics and telecommunications as an effective
technology for the protection of the environment, including the conservation of energy and resources.
2) PRINTING EQUIPMENT
The Company is striving to increase multicolor performance precision, offer increasingly advanced functionality and further consolidate its reputation in world
1RYOBI LIMITED SEMIANNUAL REPORT 2004

markets. To achieve these goals, Ryobi is pressing
forward with the development of new products andthe strengthening of production and marketing capabilities. Through the development of products inresponse to advancements in IT and digitization, andthe creation of environmentally friendly products, weare working to expand our product lineup in line withmarket needs.
3) POWER TOOLS AND BUILDERS’ HARDWARE
In the power tools business, which includes lawn andgarden equipment, Ryobi focuses on the concept ofproducing compact and lightweight maneuverable
tools. Utilizing manufacturing collaboration between
Japan and Dalian, China, the Company delivers products in response to the needs of professionals andDIY enthusiasts alike. We continue to further strengthen competitiveness by focusing efforts on bolstering
product planning and marketing capabilities, and improving productivity.
In our builders’ hardware business, we produce
door closers—a mainstay product—at our manufacturing subsidiary in Dalian, China and affiliate in Taiwan. We aim to improve profitability by focusing ondeveloping unique products, reducing costs throughproductivity enhancements, and reinforcing price competitiveness.

PERFORMANCE
During the six-month period ended 30th September
2004, consolidated net sales increased 2.0% compared with the same period of the previous fiscal yearto ¥77,423 million, with domestic net sales up 3.5%
to ¥55,178 million, and overseas net sales down 1.5%
to ¥22,245 million.
Operating income for the period increased 4.7%
to ¥4,781 million, and net income fell 72.5% to ¥2,807million.
Net sales increased across each of the Company’s
die castings, printing equipment, and power tools andbuilders’ hardware businesses. Operating income rosein line with the increase in sales. Net income however
declined, reflecting the absence of gains on sales of a
portion of investments in securities, reported in theprevious fiscal year.
By segment, net sales in the die casting businessedged up 1.2% to ¥52,141 million and operating income dropped 4.7% to ¥2,470 million, resulting in aratio of operating income to net sales of 4.7%, compared with 5.0% from the same period last year. Despite a drop in sales at our U.S.-based subsidiary,
impacted by the translation into yen following the yen’s
appreciation against the U.S. dollar, overall sales increased, buoyed by sales to domestic automobile
manufacturers. On the earnings front, Ryobi worked
to reduce costs and improve operating activities. These
efforts were insufficient to offset downward pressure
on products prices resulting in a drop in profits. We
believe demand for die cast products will grow in thefuture as an effective technology that contributes toenvironmental protection as well as resource and energy conservation, which are important global concerns. We will continue to pursue activities geared
toward the automobile segment and at the same time
expand non-automobile applications.
Net sales in the printing equipment businessclimbed 8.3% to ¥12,706 million and operating income
rose 25.3% to ¥1,127 million, resulting in a ratio ofoperating income to net sales of 8.9%, compared with
7.7% from the previous corresponding period. Sales
in Japan and exports grew, particularly of mediumsized offset printing presses. The Company enjoyedan increase in earnings due to increased sales volumeand efforts to step up reductions in costs and production lead times. Ryobi will continue to actively develop products that fully consider user needs and toenhance marketing efforts with the aim of increasing
earnings still further.
In the power tools and builders’ hardware business,
net sales rose 2.2% to ¥12,576 million while operating income increased 7.5% to ¥1,184 million, resulting in a ratio of operating income to net sales of 9.4%,
compared with 8.9% from the same period last year.
Overall sales in this segment increased. The drop insales of power tools in Japan was offset by growth inexport sales of power tools and sales of builders’ hardware in Japan. Earnings also increased in line with theimprovement in sales and enhancements to production efficiency. In the future, we will continue to leverage our overseas production capabilities with the aimof reducing costs and to deliver unique and price competitive products.
Ryobi is committed to consistently strengthening
and enhancing measures designed to create a soundand dynamic corporation. We thank you for your continued support and understanding.
December 2004

Hiroshi Urakami
Chairman and CEO

Susumu Yoshikawa
President and COO
RYOBI LIMITED SEMIANNUAL REPORT 2004

2CONSOLIDATED BALANCE SHEETS
Ryobi Limited and Consolidated Subsidiaries(As at 30th September and 31st March 2004) (Unaudited)Thousands of
U.S. Dollars*Millions of Yen

30th September
2004

31st March2004

30th September
2004

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

¥ 14,573
2,733
37,24927,6452,253
84,453¥ 17,595
2,738
38,92927,267
3,159
89,688$ 131,229
24,611
335,425
248,942
20,288760,495

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

54,72553,706

492,796

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 ................................................................................

9,128

9,615

82,197

318
1,615
2,796
2,336
16,193¥155,371

320
1,607
3,214
2,424
17,180¥160,574

2,864
14,54325,17821,036
145,818$1,399,109

LIABILITIES AND SHAREHOLDERS’ EQUITYCurrent liabilities
Short-term borrowings ................................................................
Current portion of long-term debt ...............................................
Notes and accounts payable ......................................................
Accrued expenses ......................................................................
Income taxes payable .................................................................
Other current liabilities ................................................................
Total current liabilities .......................................................

¥ 20,077
12,032
34,894
4,368
452
4,960
76,783¥ 22,222
10,42834,457
4,800
498
5,604
78,009$ 180,792
108,348314,219
39,3344,070
44,665
691,428

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

15,436
7,076
3,720
26,23221,0986,921
3,760
31,779139,000
63,71933,499236,218

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

806

746

7,258

Shareholders’ equityCommon stock
Authorised: 500,000,000 shares
Issued: 171,230,715 shares ....................................................
Capital surplus ............................................................................
Retained earnings .......................................................................
Land revaluation reserve .............................................................
Unrealised gain on available-for-sale securities ..........................
Foreign currency translation adjustments ...................................
Treasury stock .............................................................................
Total shareholders’ equity ................................................
Total ................................................................................

18,472
23,531
14,729626
2,913(8,037)(684)
51,550¥155,371

18,472
23,524
13,176626
3,125(8,205)(678)
50,040¥160,574

166,339
211,896
132,634
5,637
26,231(72,373)(6,159)464,205$1,399,109*U.S. dollar amounts in this report, solely for the convenience of the reader, are translated from yen at the rate of ¥111.05 = US$1, the exchange rate
prevailing on 30th September 2004.

3

RYOBI LIMITED SEMIANNUAL REPORT 2004

CONSOLIDATED STATEMENTS OF OPERATIONS
Ryobi Limited and Consolidated Subsidiaries(Six months ended 30th September 2004 and 2003) (Unaudited)Thousands ofU.S. Dollars*Millions of Yen

Net sales .......................................................................................
Cost of sales .................................................................................
Gross profit ..........................................................................
Selling, general and administrative expenses ............................
Operating income ................................................................
Other income
Interest and dividends ................................................................
Gain on sales of investments in securities ..................................
Other ..........................................................................................
Total other income ...............................................................
Other expenses
Interest .......................................................................................
Other ..........................................................................................
Total other expenses ...........................................................
Income before income taxes and minority interests ..................
Income taxes ................................................................................
Minority interests .........................................................................
Net income ...................................................................................

30th September
2004

30th September
2003

30th September
2004¥77,423
61,59815,825
11,044
4,781¥75,894
60,81915,075
10,5094,566$697,190
554,687
142,503
99,45043,053

98
0
969
1,067

157
8,213
818
9,188

882
0
8,726
9,608

378
703
1,081
4,767
1,901
59
¥ 2,807

557
527
1,084
12,6702,434
34¥10,202

3,404
6,330
9,734
42,927
17,119531$ 25,277

CONSOLIDATED STATEMENTS OF CASH FLOWS
Ryobi Limited and Consolidated Subsidiaries(Six months ended 30th September 2004 and 2003) (Unaudited)Thousands ofU.S. Dollars*Millions of Yen

30th September
2004

30th September
2003

30th September
2004

Net cash provided by operating activities ..................................
Investing activities
Purchase of property, plant and equipment ................................
Proceeds from sale of property, plant and equipment ................
Proceeds from sale of investments in securities ........................
Other ..........................................................................................
Net cash provided by (used in) investing activities .........
Financing activities
Proceeds from long-term debt ....................................................
Repayments of long-term debt ...................................................
Decrease in short-term borrowings, net .....................................
Dividends paid ............................................................................
Other ..........................................................................................
Net cash used in financing activities ................................
Foreign currency translation adjustments on cash and cash
equivalents ..................................................................................
Net increase (decrease) in cash and cash equivalents ...............
Cash and cash equivalents at beginning of year ........................

¥ 7,046¥ 4,558$ 63,449(2,902)277
137(2,587)(1,995)
186
8,504
194
6,889

(26,132)
2,494
9333(23,296)

1,300(5,281)(2,192)(1,255)(71)(7,499)3,170(8,440)(3,468)—(382)(9,120)11,706(47,555)(19,739)(11,301)(639)(67,528)18(3,022)
17,595

11
2,338
17,845

162(27,213)
158,442

Cash and cash equivalents at end of year ..................................

¥14,573¥20,183$131,229

Additional cash flow information
Interest paid ...................................................................................

¥¥

$

388

584

3,493RYOBI LIMITED SEMIANNUAL REPORT 2004

4

INDUSTRY SEGMENT INFORMATION(Six months ended 30th September 2004 and 2003)

Die castings

Printing
equipment

Millions of Yen
2004
Power tools andbuilders’ hardware

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

¥52,141
119¥12,706—¥12,5761

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

52,26012,706

12,577

Operating costs and expenses ...

49,79011,57911,393Operating income ......................

¥ 2,470¥ 1,127¥ 1,184

Consolidated¥—(120)¥77,423—(120)

77,423¥

Millions of Yen
2003
Power tools andbuilders’ hardware
Other

Die castings

Printing
equipment

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

¥51,501
128¥11,728—¥12,309
5

¥356
—

(120)

72,6420¥ 4,781

Eliminations

Consolidated¥ —(133)¥75,894—

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

51,62911,72812,314356(133)

75,894

Operating costs and expenses ...

49,037

10,829

11,213382(133)

71,328Operating income (loss) .............

¥ 2,592¥¥ 1,101¥ (26)¥¥ 4,566

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

5Eliminations

899

Die castings

Printing
equipment

Thousands of U.S.dollars*
2004
Power tools andbuilders’ hardware$469,527
1,072$114,417—$113,246
90

Eliminations

Consolidated$—(1,081)$697,190—

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

470,599

114,417

113,255(1,081)

697,190

Operating costs and expenses ...

448,357

104,268

102,593(1,081)

654,137

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

$ 22,242$ 10,149$ 10,662$$ 43,053

RYOBI LIMITED SEMIANNUAL REPORT 2004

0GEOGRAPHICAL SEGMENT INFORMATION(Six months ended 30th September 2004 and 2003)

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

JapanNorth America

Millions of Yen
2004
Other overseas¥64,013968¥ 9,836—¥3,574
2,345

Eliminations

Consolidated¥—(3,313)¥77,423—

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

64,981

9,836

5,919

(3,313)77,423Operating costs and expenses ...

61,721

9,086

5,131

(3,296)

72,642

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

¥ 3,260

¥ 750

¥ 788

¥

(17)

¥ 4,781

Eliminations

Consolidated¥¥75,894—

JapanNorth America

Millions of Yen
2003
Other overseas

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

¥61,257
1,372¥11,168—¥3,4692,220—(3,592)

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

62,629

11,1685,689(3,592)75,894

Operating costs and expenses ...

59,430

10,485

5,017(3,604)

71,328Operating income ......................

¥ 3,199

683

¥ 672

12

¥ 4,566

Eliminations

Consolidated$—(29,833)$697,190—(29,833)

697,190¥

Japan

North America

Thousands of U.S.dollars*
2004
Other overseas

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

$576,434
8,716$88,573—$32,183
21,117

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

585,150

88,57353,300Operating costs and expenses ...

555,794

81,81946,204

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

$ 29,356$ 6,754$ 7,096¥$(29,680)

654,137(153)$ 43,053

EXPORT SALES AND SALES BY OVERSEAS SUBSIDIARIES(Six months ended 30th September 2004 and 2003)

2004

2003

Thousands ofU.S. dollars*
2004

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

¥11,246
7,843
3,156

¥13,361
6,634
2,599

$101,270
70,62628,41914.5%
10.1%
4.1%

17.6%
8.7%
3.5%

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

¥22,245¥22,594$200,315

28.7%

29.8%

Millions of Yen

Percentage against
consolidated net sales
2004
2003

RYOBI LIMITED SEMIANNUAL REPORT 2004

6CORPORATE INFORMATIONCORPORATE DATA
Company NameRYOBI LIMITED

Head Office762, Mesaki-cho, Fuchu, Hiroshima 726-8628, Japan
Telephone: 81-847-41-1111

Established16th December 1943
Major Products
Die cast products
Printing equipment(offset printing presses, page layout software, etc.)
Power tools(electric power tools, lawn and garden equipment, etc.)
Builders’ hardware(door closers, hinges, architectural hardware, etc.)

Tokyo Branch
5-2-8, Toshima, Kita-ku, Tokyo 114-8518, Japan
Telephone: 81-3-3927-5541
Toranomon Office
Toranomon Central Building
1-7-1, Nishi-shinbashi, Minato-ku, Tokyo 105-0003, Japan
Telephone: 81-3-3927-5541

DIRECTORS, CORPORATE AUDITORS AND CORPORATE OFFICERS
Chairman and CEO
Hiroshi Urakami

Corporate Officers
Koji Ishii
Kuniyuki Ito
Kenjiro Suzuki
Akira Urakami
Naomichi Honkawa
Kazuaki Danjo
Shoji Osawa
Hideki Domoto

President and COO
Susumu Yoshikawa
Director and Corporate Officers
Takao Tanaka
Takashi Yokoyama
Mikio Kamura
Shiro Muroya
Standing Corporate Auditor
Shozo Kobayashi
Corporate Auditors
Satoshi Ohoka
Hiroaki Takahashi
Kunihiro Toyota

SHAREHOLDER INFORMATION
Number of Shares Issued(As of 30th September 2004)

171,230,715
Listing
Common Stock—Tokyo

Transfer Agent
The Mitsubishi Trust and Banking Corporation
4-5, Marunouchi 1-chome, Chiyoda-ku,
Tokyo 100-8212, Japan

http://www.ryobi-group.co.jp/
This semiannual report was printed by a Ryobi printing press using 100% recycled paper and soybean ink.

PRINTED IN JAPAN©RYOBI LIMITED 2004