Consolidated Financial Results for the Fiscal Year Ended March 31, 2014 [J-GAAP]May 13, 2014

Company Name:

Dai Nippon Printing Co., Ltd.

Stock exchange listing:Tokyo
Stock code:
7912
URL: http://www.dnp.co.jp/
Representative:
Yoshitoshi Kitajima, President
Contact person:
Takaaki Tamura, General Manager, Press and Public Relations
Telephone:+81-3-5225-8220
General meeting of shareholders:June 27, 2014
Dividend payment date:June 30, 2014
Securities report issuing date:June 27, 2014
Preparation of earnings presentation material: None
Holding of earnings announcement:
None*Amounts under one million yen have been rounded down.

1. Consolidated financial results for the year ended March 31, 2014
(April 1, 2013 – March 31, 2014)(1) Consolidated financial results(Percentages show change from corresponding year-ago period.)
Net Sales

Operating Income

Ordinary Income

Net Income

Million yen%

Million yen%

Million yen%

Million yen%

Year ended March 31, 2014

1,448,550

0.1

50,09840.0

53,28532.2

25,641

33.4

Year ended March 31, 2013

1,446,607(4.0)

35,7795.2

40,318

9.4

19,217–

Note: Comprehensive income: Year ended March 31, 2014: ¥55,717 million (32.3%)
Year ended March 31, 2013: ¥42,121 million (–%)
Net Income
per Share

Diluted Net
Incomeper Share

Ordinary
Income toTotal Assets

ROE

Operating
Income to
Net Sales

Yen

Yen

%

%

%

Year ended March 31, 2014

39.82

39.65

2.8

3.4

3.5

Year ended March 31, 2013

29.84

29.79

2.2

2.5

2.5

Reference: Equity in earnings of affiliates: Year ended March 31, 2014: ¥742 million
Year ended March 31, 2013: ¥3,012 million(2) Consolidated financial position
Total Assets

Net Assets

Net Assets
per Share

Equity Ratio

Million yen

Million yen%

Yen

As of March 31, 2014

1,574,753

976,38659.2

1,447.96

As of March 31, 2013

1,578,976

937,055

56.6

1,386.86

Reference: Stockholders’ equity: As of March 31, 2014: ¥932,329 million As of March 31, 2013: ¥893,124 million(3) Consolidated cash flows
Cash Flows fromOperating Activities

Cash Flows from
Investing Activities

Cash Flows from
Financing Activities

Cash and Cash
Equivalents at Endof the Year

Million yen

Million yen

Million yen

Million yen

Year ended March 31, 2014

120,108(58,370)(80,038)

199,813

Year ended March 31, 2013

100,497(72,587)(36,236)

212,062

2. Dividends
Dividends per Share
First
SecondThird
Quarter-end Quarter-end Quarter-end

Year-end

AnnualTotal Dividends(Annual)Dividend
Payout Ratio(Consolidated)

Dividends to
Net Assets
Ratio(Consolidated)

Yen

Yen

Yen

Yen

Yen

Million yen%%

Year ended March 31, 2013

–

16.00

–

16.00

32.00

20,625

107.2

2.3

Year ended March 31, 2014

–

16.00

–

16.00

32.00

20,62380.4

2.3

Year ending March 31,
2015 (Forecast)

–

16.00

–

16.00

32.00

79.2

3. Consolidated earnings forecasts for the year ending March 31, 2015
(April 1, 2014 – March 31, 2015)(Percentages show change from corresponding year-ago period.)
Operating
IncomeNet Sales
Full year

Ordinary Income

Net Income
per Share

Net Income

Million yen%

Million yen%

Million yen%

Million yen%

Yen

1,500,000

3.6

52,0003.8

54,0001.3

26,0001.4

40.38* Notes(1) Changes in significant subsidiaries during the period (changes in specified subsidiaries resulting ina change in the scope of consolidation): No(2) Changes in accounting policies, changes in accounting estimates, and restatement of revisions
1) Changes in accounting policies with revision of accounting standards: Yes
2) Changes in accounting policies other than the 1) above:No3) Changes in accounting estimates:
No4) Restatement of revisions:No
Note: For further details, see the section titled, “4. Consolidated financial statements (5) Notes regarding
consolidated financial statements [Changes in accounting policies],” on page 26.

(3) Number of common shares issued and outstanding
1) Number of common shares outstanding at endof each period (including treasury shares)
2) Number of treasury shares at end of eachperiod3) Average number of shares outstanding during
the period

As of March 31,
2014
As of March 31,
2014Year ended
March 31, 2014

700,480,693
shares56,586,830
shares643,945,619
shares

As of March 31,
2013
As of March 31,
2013
Year ended
March 31, 2013

700,480,693
shares56,490,329
shares644,029,540
shares(Reference) Non-consolidated financial results
Non-consolidated financial results for the year ended March 31, 2014
(April 1, 2013 – March 31, 2014)(1) Non-consolidated financial results(Percentages show change from corresponding year-ago period.)
Operating Income
Ordinary Income
Net Income(Loss)Net Sales
Million yen%

Million yen%

Million yen%

Million yen%

Year ended March 31, 2014

919,016

(0.8)

3,447

–

26,483

33.2

12,547(16.0)

Year ended March 31, 2013

926,142(4.8)(3,988)–19,88484.8

14,933–Net Income
per Share

Diluted Net Income
per Share
Yen

Yen

Year ended March 31, 2014

19.47

–

Year ended March 31, 2013

23.17

–

(2) Non-consolidated financial position
Total Assets

Net Assets

Net Assets
per Share

Equity Ratio

Million yen

Million yen%

Yen

As of March 31, 2014

1,228,480

666,16254.2

1,033.71

As of March 31, 2013

1,247,963

659,47152.8

1,023.17

Reference: Stockholders’ equity: As of March 31, 2014: ¥666,162 million As of March 31, 2013: ¥659,471 million* Presentation of audit status
These consolidated financial results are exempt from auditing procedures based on the Financial
Instruments and Exchange Act. The financial statements are being audited based on the Financial
Instruments and Exchange Act at the time of the disclosure of these consolidated financial results.
* Explanation regarding appropriate use of earnings forecasts and other special notes
Forward-looking statements in this report, including earnings forecasts, are based on assumptions about
economic conditions, market trends, and other factors at the time the report was prepared. Actual results
may differ significantly due to a variety of factors.
See the “1. Analysis of operating results and financial position (1) Analysis of operating results” on pages
2–4 for information about earnings forecasts.

Contents
1. Analysis of operating results and financial position ................................................................................ 2(1) Analysis of operating results ............................................................................................................ 2(2) Analysis of financial position ............................................................................................................ 4(3) Basic policies regarding the allocation of profits and dividends for the year ended March 31, 2014
and year ending March 31, 2015 ..................................................................................................... 5(4) Business risks .................................................................................................................................. 5
2. Information on DNP ................................................................................................................................ 8
3. Management policies ............................................................................................................................ 12(1) Core policies .................................................................................................................................. 12(2) Medium- and long-term management strategy and key issues ..................................................... 12
4. Consolidated financial statements ........................................................................................................ 16(1) Consolidated balance sheets ......................................................................................................... 16(2) Consolidated statements of income and comprehensive income ................................................. 18(3) Consolidated statements of changes in net assets ....................................................................... 20(4) Consolidated statements of cash flows ......................................................................................... 22(5) Notes regarding consolidated financial statements ....................................................................... 24[Notes on premise of a going concern] ........................................................................................... 24[Basis of presenting consolidated financial statements] ................................................................. 24[Changes in accounting policies] .................................................................................................... 26[Consolidated balance sheets] ....................................................................................................... 27[Consolidated statements of income] ............................................................................................. 27[Consolidated statements of changes in net assets] ...................................................................... 27[Segment information, etc.] ............................................................................................................. 29[Per share information] ................................................................................................................... 32[Significant subsequent events] ...................................................................................................... 32
5. Non-consolidated financial statements ................................................................................................. 34(1) Non-consolidated balance sheets .................................................................................................. 34(2) Non-consolidated statements of income ........................................................................................ 36(3) Non-consolidated statements of changes in net assets ................................................................ 37(4) Notes regarding non-consolidated financial statements ................................................................ 39[Notes on premise of a going concern] .......................................................................................... 39
6. Changes in directors and officers (as of June 27, 2014) ...................................................................... 39

1

1. Analysis of operating results and financial position(1) Analysis of operating results1) Operating results for the fiscal year ended March 31, 2014
During the fiscal year ended March 31, 2014, Japan’s economy showed some positive signs,
including an increase in consumer spending and improvement in corporate earnings, aided by aseries of government economic policies. However, the economy has still not reached a full-fledged
recovery, due partly to the impact of higher energy prices and slower economic growth in emerging
countries.
The printing industry continued to face a tough business environment, due partly to sluggish
demand, higher raw material prices, and a decline in order prices from stiffer competition.
In this environment, the DNP Group (DNP) sought to aggressively develop its business under thecatchphrase “Today’s Innovation is Tomorrow’s Basic” and deliver products, services, and various
solutions tailored to the needs of companies and consumers, based on its P&I Solutions businessvision (P&I stands for “Printing Technology” and “Information Technology”).
DNP opened the DNP Kashiwa Data Center equipped with advanced information security andearthquake and fire protection in December 2013. This center provides a business platform forsafely and securely handling customer information and other data, mainly in the Information
Communication segment, and DNP is using this infrastructure to deliver cloud services to companies
and move forward with consumer services such as e-books and e-flyers. In the Lifestyle andIndustrial Supplies segment, DNP is focusing on expanding business in Southeast Asia amid
expectations for economic growth, and opened a new packaging materials plant in Vietnam in May
2013. Additionally, to respond to growing photo printing needs in Southeast Asia, DNP completed
construction of a plant in Malaysia to make dye-sublimation thermal transfer printing media (color ink
ribbons and receiver paper) in December 2013. In the Electronics segment, DNP has worked to
improve earnings by reworking production lines, consolidating production facilities, and rebuilding its
organizational structure.
Amid major changes in society, DNP seeks to quickly identify problems that face consumers andsociety and create new value by solving these problems.
As a result of these activities, consolidated net sales grew 0.1% year on year to ¥1,448.5 billion,
consolidated operating income grew 40.0% to ¥50.0 billion, consolidated ordinary income grew
32.2% to ¥53.2 billion, and consolidated net income grew 33.4% to ¥25.6 billion.
The results by segment are as follows.
[PRINTING]
Information Communication
In the Books and Magazines business, amid a continued slump in the publications market, booksales increased from last year thanks to aggressive sales activities, but magazines decreased andoverall sales fell below prior-year levels.
In the Commercial Printing business, despite growth for Business Process Outsourcing (BPO; e.g.,
operation of campaign offices and customer centers), overall sales decreased year on year on weaksales for existing printed materials, including pamphlets and catalogs.
The Business Forms business performed well as Information Processing Services (IPS; ranging
from data entry to printing and shipment of personalized mail and other items) increased with thestart of account opening services for the Nippon Individual Savings Account (NISA) program.
In the Education and Publications Distribution business, DNP worked to expand business in the“honto” hybrid bookstore network that combines physical bookstores, online bookstores, and e-book2

sales services. However, sales decreased from the previous year on a decline in bookstore sales.
As a result of the above, overall segment sales fell 0.6% year on year to ¥700.3 billion andoperating income fell 25.4% to ¥11.9 billion.
Lifestyle and Industrial Supplies
In the Packaging business, film packaging for foods and daily goods was firm, but sales decreased
year on year on a decline for PET bottle aseptic filling systems.
The Lifestyle Materials business performed well on growth for eco-friendly products that use
DNP’s proprietary Electron Beam coating technology, aided by an increase in rush demand ahead of
the consumption tax hike.
In the Industrial Supplies business, despite a decline for energy-related products, including softpacks for lithium-ion batteries, overall sales increased year on year on growth for LCD surface films
and strong sales of dye-sublimation thermal transfer printing media for photo printers, buoyed by acontribution from a new plant in Malaysia.
As a result of the above, overall segment sales grew 2.3% year on year to ¥533.5 billion andoperating income rose 21.0% to ¥33.9 billion.
Electronics
In the LCD Color Filter business, small- and medium-sized filters were firm as a result of shifting
production to smartphones and tablets, but sales decreased year on year on a decline for large TV
and PC filters.
Semiconductor photomasks were sluggish in Japan, but sales increased from last year as a resultof tapping into overseas demand, which continues to expand.
As a result of the above, overall segment sales fell 5.1% year on year to ¥171.3 billion andoperating income totaled ¥12.9 billion, versus a loss of ¥0.3 billion in the previous fiscal year.
[BEVERAGES]
Beverages
The soft drink market continues to face severe sales competition, and DNP worked to expand sales
through aggressive promotional activities.
As a result of the above, sales increased for I LOHAS, a brand of mineral water that uses alightweight PET bottle, but decreased for coffee beverages. Overall segment sales fell 2.6% year on
year to ¥54.8 billion but operating income grew 38.6% to ¥0.6 billion.
2) Forecast for the fiscal year ending March 31, 2015
Concerning the future outlook, although DNP expects a series of government economic policies tohelp overcome deflation and spur an economic recovery, it is concerned about the impact of lower
demand after the consumption tax hike and overseas economic slowdowns. In the printing industry,
DNP expects conditions to remain difficult amid a rise in raw material prices and decline in orderprices due to weak domestic demand and stiffer competition.
During the fiscal year ending March 31, 2015, DNP intends to work to expand its business under
the catchphrase “Today’s Innovation is Tomorrow’s Basic,” based on its P&I Solutions businessvision. This entails the development of new products and services that solve the problems that facecompanies, consumers, and society, and making these products and services a natural part of theireveryday lives. DNP will pursue aggressive business activities to organize and analyze the problems
facing society, and to provide solutions that leverage its strengths based on the main themes of“information distribution”, “health and medical care”, “environment and energy”, and “comfortableliving”. DNP will also work to increase productivity further to establish a more robust business base.

3For the fiscal year ending March 31, 2015, DNP forecasts consolidated net sales of ¥1,500.0
billion, consolidated operating income of ¥52.0 billion, consolidated ordinary income of ¥54.0 billion,
and consolidated net income of ¥26.0 billion.
(2) Analysis of financial position
1) Assets, liabilities, and net assets
Total assets at the end of the current fiscal year decreased by ¥4.2 billion from the end of theprevious fiscal year to ¥1,574.7 billion, due mainly to a decrease for cash and time deposits.
Total liabilities decreased by ¥43.5 billion from the end of the previous fiscal year to ¥598.3 billion,
due mainly to a decrease for current portion of bonds.
Net assets increased by ¥39.3 billion from the end of the previous fiscal year to ¥976.3 billion, due
mainly to increases for valuation difference on available-for-sale securities and foreign currencytranslation adjustments.
2) Cash flows
Consolidated cash flow provided by operating activities totaled ¥120.1 billion (¥100.4 billion in theprevious fiscal year), due mainly to ¥48.6 billion in income before income taxes and minority
interests and ¥73.4 billion in depreciation.
Cash flow used in investing activities totaled ¥58.3 billion (¥72.5 billion in the previous fiscal year),due mainly to ¥54.8 billion in payments for purchases of property, plant and equipment. Cash flowused in financing activities totaled ¥80.0 billion (¥36.2 billion in the previous fiscal year), due mainly
to ¥50.7 billion in payments for redemption of bonds and ¥20.6 billion in dividends paid.
As a result, cash and cash equivalents at the end of the fiscal year decreased by ¥12.2 billion fromthe end of the previous fiscal year to ¥199.8 billion.
The trends in DNP’s cash flow indicators are shown below.
Year ended
March 2010

Year ended
March 2011

Year ended
March 2012

Year ended
March 2013

Year ended
March 2014

Equity ratio (%)

56.6

55.1

54.2

56.6

59.2

Market value-based
equity ratio (%)

50.3

39.6

33.9

36.1

40.4

Debt-to-cash flow ratio(year)

1.2

1.6

2.1

2.3

1.5

Interest coverage ratio(times)

63.9

52.6

33.2

28.8

40.6

Notes:***

Equity ratio: Total stockholders’ equity / Total assets
Market value-based equity ratio: Market capitalization / Total assets
Debt-to-cash flow ratio: Interest-bearing debt / Cash flow
Interest coverage ratio: Cash flow / Interest paid
The above indicators are calculated based on consolidated financial figures.
Market capitalization is calculated as: Fiscal year-end share price  fiscal year-end number of shares
outstanding (excluding treasury stock)
Cash flow: Cash flow provided by/used in operating activities on the consolidated statements of cash flows
Interest-bearing debt: All liabilities on the consolidated balance sheet that accrue interest charges
Interest paid: Interest paid on the consolidated statements of cash flows

4(3) Basic policies regarding the allocation of profits and dividends for the year ended March
31, 2014 and year ending March 31, 2015
An important policy of Dai Nippon Printing Co., Ltd. (the Company) is to pass on profits toshareholders.
Profits are allocated based on a policy of paying stable dividends to shareholders and withconsideration for financial results and the dividend payout ratio. For future business expansion, theCompany strives to retain profits and strengthen its financial constitution and management base.
Retained earnings are used to invest in research and development related to new products andtechnologies, to invest in equipment needed for developing new businesses, and to implement
strategic alliances, including mergers and acquisitions. At the same time, the Company considers
flexible capital policies while also taking into consideration market trends as well as its need forcapital. The Company believes that these efforts will contribute to higher profits that can then bepassed on to shareholders in the future.
Based on this policy, the Company intends to pay a year-end dividend of ¥16 per share, which
together with the interim dividend of ¥16 per share brings the full-year dividend to ¥32 per share, thesame as in the previous fiscal year.
The forecast dividend for the fiscal year ending March 31, 2015 is ¥32 per share, the total of a ¥16interim dividend and a ¥16 year-end dividend.
(4) Business risks
The performance and the results of DNP could be significantly affected by a variety of factors andcircumstances that might arise in the future. Because DNP is aware of these risk factors, its policy is
to strive to minimize their potential effects.
The following are the major factors that the DNP management views as risks.
1) The Japanese and overseas economies and consumption trends
DNP engages in a wide range of businesses with an extremely large number of corporate customers,
and steadily conducts its business so as not to overly depend on specific customers. DNP does mostof its business in the Japanese market, but if consumer spending and other components of domestic
demand slump, owing to domestic economic weakness in sympathy with global economic trends,
declines in order volume and unit prices may affect its corporate performance.
Additionally, DNP could be directly or indirectly affected by market trends in various industries inJapan or overseas. In particular, electronics-related industries are susceptible to global declines inunit prices caused by an expansion of production in emerging countries and changes in demand,and DNP’s performance could be affected by major changes in market trends.
2) Overseas business activities
DNP conducts overseas business activities in the Americas, Europe, Southeast Asia, and elsewhere,
and these activities face risks including social and political turmoil caused not only by economic
factors such as unexpected changes in law and regulations, fragility of industrial infrastructure, anddifficulty of hiring and securing personnel, but also by terrorism, war, and other factors. DNP’sperformance could be affected if its overseas business activities are obstructed as a result of theserisks materializing.
3) Development of new products and services
DNP uses its printing and information technologies to develop and provide to a broad range ofindustries products and services that solve problems facing companies, consumers, and society.

5The pace of technological innovation in these areas has been accelerating, and customers’ needs
have been rapidly diversifying. We believe that in the future, competition in the area of productdevelopment will become more intense than ever before in Japan and overseas, and it is possiblethat DNP’s performance could fluctuate significantly due to unforeseeable changes in market trends
or a shortening of product life cycles.
4) Strategic business and capital alliances and corporate acquisitions
DNP engages in strategic business and capital alliances and corporate acquisitions, and its
performance could be affected if it is unable to achieve initially expected results and synergies as aresult of deterioration in the business environment affecting the companies and businesses involvedin these alliances and acquisitions.
5) Fluctuations in raw material procurement
We work hard to secure stable supplies and maintain optimal price by procuring raw materials suchas printing paper and film from multiple suppliers in Japan and overseas. However, there is somepotential for temporary imbalances between supply and demand due to sharp fluctuations inpetroleum prices, sudden surges in demand from emerging markets, and the impact of majordisasters. DNP will respond during such times by negotiating with client companies and business
partners, but its performance could be affected if raw materials procurement becomes extremely
difficult or if purchasing prices rise sharply.
6) Currency fluctuations
Particularly in fields such as Lifestyle and Industrial Supplies, and Electronics, we are expanding ourdealings in products and services with overseas customers. Because we expect the effects ofcurrency rates to gradually become more important, we use such means as foreign exchange
forward contracts to hedge the risks of currency fluctuations. Nevertheless, it is possible that radical
swings in currency values could have a more serious effect on DNP’s performance.
7) Environmental protection and stricter environmental regulations
DNP is affected by legal regulations in Japan and other countries related to energy conservation,
climate change prevention (e.g., reduction of greenhouse gas emissions), reduction of the use ofharmful substances, air pollution prevention, water quality protection, waste treatment, and productrecycling. These regulations could possibly be strengthened or changed in the future. In addition,
DNP’s business could be substantially affected if faced with a situation in which soil is contaminatedby harmful substances and it is held responsible for assessment and cleanup.
8) Information security and personal information protection
Computer networks and information systems have become essential tools for conducting business,and there are now greater risks of software and hardware defects, computer virus infections, andpersonal data leaks. DNP regards the protection of data and personal information as a top priority. It
is doing all it can to protect and maintain systems and data by strengthening its organization andtraining employees, but if problems arise in these areas, then its business activity could be affected.
9) Respond to changes in legal regulations, etc.
We conduct our business based on strict compliance with the law and social ethics. Wherever we
operate, in Japan or overseas, we are subject to a wide variety of legal regulations and restrictions,
including laws related to product liability, monopoly prohibitions, the protection of personal
information, patents, taxes, imports and exports, etc. We can imagine that in the future such6

regulations could become even more restrictive. On the other hand, market and industry trends maychange substantially as a result of deregulation. If that should occur, it is possible that DNP’sbusiness performance could be affected by limitations on its business activities, the burden of
responding to regulatory changes, or increased costs.
10) Disasters
DNP takes steps to protect production equipment and other major facilities from fires andearthquakes, seeks to disperse production facilities, and works to minimize production shutdowns
and product supply disruptions caused by disasters. We also use various types of insurance totransfer risk. Nevertheless, DNP’s performance could be substantially affected in the event of major
earthquakes, natural disasters such as heavy rainfall or flooding caused by climate change, disease
outbreaks, or other unexpected events that cause production shutdowns or significantly damage or
impair social infrastructure.
11) Lawsuits and fines
DNP works to establish corporate ethics throughout the group and earn the trust of society by eachand every employee complying with laws and regulations in conducting business activities,
maintaining higher ethical standards than required by society, and contributing to maintaining andadvancing orderly and freely competitive markets with a consistently fair attitude. Nevertheless,
DNP’s performance could be affected in the event of being subject to lawsuits and resulting fines inJapan or overseas.

7

2. Information on DNP
DNP Group includes the Company, 153 subsidiaries, and 18 affiliated companies. Its two main
businesses are Printing and Beverages. The former encompasses Information Communication,
Lifestyle and Industrial Supplies, and Electronics.
The businesses and segments of DNP are outlined below. The four business segments cited
below are the same as the reporting segment categories.
[PRINTING]
Information Communication
Production/sale of textbooks, books, weekly/monthly/quarterly magazines, advertisements, stockand other securities certificates, business forms, and cards; manufacture/sale of businessequipment and systems; and planning/design/construction/management of stores and advertising
media
Major companies
Production

OGUCHI BOOK BINDING & PRINTING CO., LTD.
DNP AV Center Co., Ltd., DNP SP Tech Co., Ltd.
DNP Graphica Co., Ltd., DNP Book Factory Co., Ltd.
DNP Digitalcom Co., Ltd., DNP Data Techno Co., Ltd.
DNP Data Techno Kansai Co., Ltd.
DNP Total Process Warabi Co., Ltd.
DNP Multi Print Co., Ltd., DNP Media Art Co., Ltd.
DNP Media Create Co., Ltd., DNP Media Support Co., Ltd.
DNP Media Techno Kansai Co., Ltd.

Production and sales

Tien Wah Press (Pte.) Ltd.

Sales and services

Maruzen CHI Holdings Co., Ltd., INTELLIGENT WAVE INC.
BUNKYODO GROUP HOLDINGS CO., LTD.
SHUFUNOTOMO Co., Ltd., 2Dfacto, Inc.
DNP Art Communications Co., Ltd., DNP Social Links Co., Ltd.
mobilebook.jp, Inc., Maruzen Co., Ltd.
MARUZEN PUBLISHING CO., LTD.
Maruzen Bookstores Co., Ltd., Toshokan Ryutsu Center Co., Ltd.
Junkudo Co., Ltd., Yushodo Co., Ltd.
honto Book Services Co., Ltd., BUNKYODO Co., Ltd.
* Nihon Unisys, Ltd., BOOKOFF CORPORATION LIMITEDAll About, Inc., Kyoiku Shuppan Co., Ltd.
The shares of Maruzen CHI Holdings Co., Ltd., Nihon Unisys, Ltd. and
BOOKOFF CORPORATION LIMITED are traded on the Tokyo Stock
Exchange, and the shares of INTELLIGENT WAVE INC., BUNKYODOGROUP HOLDINGS CO., LTD. and All About, Inc. are traded on theTokyo Securities Exchange’s JASDAQ market.

8Lifestyle and Industrial Supplies
Manufacture/sale of containers and packaging products, packaging equipment and systems, interior
and exterior construction materials, photographic materials, and industrial supplies
Major companies
Production

DNP Technopack Co., Ltd., Sagami Yoki Co., Ltd., DNP IMS Co., Ltd.
DNP Advanced Optics Co., Ltd., DNP Energy System Co., Ltd.,DNP Ellio Co., Ltd., DNP Lifestyle Materials Co., Ltd.

Production and sales

Aseptic Systems Co., Ltd.
DNP Fine Chemicals Utsunomiya Co., Ltd.
DNP Hoso Co., Ltd., DNP IMS Malaysia Sdn. Bhd.
PT DNP Indonesia, DNP Vietnam Co., Ltd.
DNP Electronics America, LLC, DNP IMS America Corporation
DNP Denmark A/S, DNP IMS Netherlands B.V.

Sales and services

DNP ID System Co., Ltd., DNP Lifestyle Materials Marketing Co., Ltd.
DNP DreamPages Co. Ltd., DNP Field Eyes Co., Ltd.
DNP Photo Imaging Co., Ltd., DNP Fotolusio Co., Ltd.
LIFESCAPE MARKETING CORPORATIONDNP Photo Imaging Europe SAS

Electronics
Manufacture/sale of precision electronic components and other products
Major companies
Production

DNP LSI Design Co., Ltd., DNP Signage Technology Co., Ltd.
DNP Fine Electronics Co., Ltd.
DNP Precision Devices Himeji Co., Ltd.
DNP Micro Technica Co., Ltd.

Production and sales

DNP Color Techno Kameyama Co., Ltd., DAP Technology Co., Ltd.
DT Fine Electronics Co., Ltd., DNP Photomask Europe S.p.A.
DNP Photomask Technology Taiwan Co., Ltd.

Sales

DNP Taiwan Co., Ltd.

Other companies with multiple types of businesses
Production and sales

DNP Hokkaido Co., Ltd., DNP Tohoku Co., Ltd.
DNP Chubu Co., Ltd., DNP Shikoku Co., Ltd.
DNP Nishi Nippon Co., Ltd., DNP Fine Chemicals Co., Ltd.
D.N.K. Co., Ltd.
* DIC Graphics Corporation

Sales and services

DNP Logistics Co., Ltd., DNP Trading Co., Ltd.
DNP Accounting Services Co., Ltd.
DNP Information Systems Co., Ltd.
DNP Human Services Co., Ltd., DNP Facility Services Co., Ltd.
DNP Asia Pacific Pte. Ltd., DNP Corporation USA
DNP America, LLC, DNP Holding USA Corporation

9

[BEVERAGES]
Beverages
Centered on Hokkaido Coca-Cola Bottling Co., Ltd.; manufacture/sale of soft drinks and juices
The shares of Hokkaido Coca-Cola Bottling Co., Ltd. are traded on the Tokyo Stock Exchange andSapporo Securities Exchange.
* Equity-method affiliated companies

10Organizational chart
The businesses noted above are shown in the organizational chart below.

Customers
Information Communication(Production and sales)
Tien Wah Press (Pte.) Ltd.

Lifestyle and Industrial Supplies

Electronics(Production and sales)
DNP IMS Malaysia Sdn. Bhd.
PT DNP Indonesia
DNP Vietnam Co., Ltd.
DNP Electronics America, LLC
DNP IMS America Corp.
DNP Denmark A/SDNP IMS Netherlands B.V.

Beverages(Sales)DNP Taiwan Co., Ltd.
(Production and sales)
DNP Photomask Europe S.p.A.
DNP Photomask Technology Taiwan
Co., Ltd.

(Sales and service provision)
DNP Photo Imaging Europe SAS

Dai Nippon Printing Co., Ltd.

(Production)
OGUCHI BOOK BINDING &PRINTING CO., LTD.
DNP AV Center Co., Ltd.
DNP SP Tech Co., Ltd.
DNP Graphica Co., Ltd.
DNP Book Factory Co., Ltd.
DNP Digitalcom Co., Ltd.
DNP Data Techno Co., Ltd.
DNP Data Techno Kansai Co., Ltd.
DNP Total Process Warabi Co., Ltd.
DNP Multi Print Co., Ltd.
DNP Media Art Co., Ltd.
DNP Media Create Co., Ltd.
DNP Media Support Co., Ltd.
DNP Media Techno Kansai Co., Ltd.

(Sales and service provision, etc.)
Maruzen CHI Holdings Co., Ltd.
INTELLIGENT WAVE INC.
BUNKYODO GROUP HOLDINGS
CO., LTD.
SHUFUNOTOMO Co., Ltd.
2Dfacto, Inc.
DNP Art Communications Co., Ltd.
DNP Social Links Co., Ltd.
mobilebook.jp, Inc.
Maruzen Co., Ltd.
MARUZEN PUBLISHING CO., LTD.
Maruzen Bookstores Co., Ltd.
Toshokan Ryutsu Center Co., Ltd.
Junkudo Co., Ltd.
Yushodo Co., Ltd.
honto Book Services Co., Ltd.
BUNKYODO Co., Ltd.
Nihon Unisys, Ltd. *BOOKOFF CORPORATION
LIMITED*All About, Inc.*
Kyoiku Shuppan Co., Ltd.*(Production)
DNP Technopack Co., Ltd.
Sagami Yoki Co., Ltd.
DNP IMS Co., Ltd.
DNP Advanced Optics Co., Ltd.
DNP Energy System Co., Ltd.
DNP Ellio Co., Ltd.
DNP Lifestyle Materials Co., Ltd.

(Production and sales)
Aseptic Systems Co., Ltd.
DNP Fine Chemicals Utsunomiya
Co., Ltd.
DNP Hoso Co., Ltd.

(Production)
DNP LSI Design Co., Ltd.
DNP Signage Technology Co., Ltd.
DNP Fine Electronics Co., Ltd.
DNP Precision Devices Himeji Co.,Ltd.
DNP Micro Technica Co., Ltd.

(Production and sales)
DNP Color Techno Kameyama Co.,Ltd.
DAP Technology Co., Ltd.
DT Fine Electronics Co., Ltd.

(Sales and service provision, etc.)
DNP ID System Co., Ltd.
DNP Lifestyle Materials Marketing
Co., Ltd.
DNP DreamPages Co., Ltd.
DNP Field Eyes Co., Ltd.
DNP Photo Imaging Co., Ltd.
DNP Fotolusio Co., Ltd.
LIFESCAPE MARKETINGCORPORATION(Production and sales)
DNP Fine Chemicals Co., Ltd.

D.N.K. Co., Ltd.

DIC Graphics Corporation*(Sales and service provision, etc.)
DNP Logistics Co., Ltd.
DNP Information Systems Co., Ltd.
DNP Asia Pacific Pte. Ltd.

DNP Trading Co., Ltd.
DNP Human Services Co., Ltd.
DNP Corporation USA

DNP Accounting Services Co., Ltd.
DNP Facility Services Co., Ltd.
DNP America, LLC

Printing businessNotes: *Hokkaido Coca-Cola Bottling Co., Ltd.
(Production and sales)(Production and sales)
DNP Hokkaido Co., Ltd.
DNP Tohoku Co., Ltd.
DNP Chubu Co., Ltd.
DNP Shikoku Co., Ltd.
DNP Nishi Nippon Co., Ltd.

: Equity-method affiliated companies (Otherwise, subsidiaries): Flow of products, materials and services

11

DNP Holding USA Corp.

Beverages
business3. Management policies(1) Core policies
DNP has been striving to contribute to the sustainable growth of society by providing newvalue-added products and services through its business activities, based on a management concept
of contributing to the emergently evolving society of the 21st century. With a business vision of P&I
Solutions (P&I stands for “Printing Technology” and “Information Technology”) to realize its
management concept, DNP will continue to solve the problems of corporate clients, consumers, andsociety by making the most of its strengths in printing and information technologies.
Additionally, to promote fair and appropriate corporate activity and fulfill its corporate social
responsibilities (CSR), DNP strictly complies with laws and social ethics based on the DNP Group
Code of Conduct and ensures proper business activities through an internal control system. The
Company strives to conduct business in good faith to earn the deep trust of its various stakeholders,
including shareholders, customers, consumers, and employees.
(2) Medium- and long-term management strategy and key issues
DNP is working to expand its business over the medium to long term through the aggressive pursuitof business activities under the catchphrase “Today’s Innovation is Tomorrow’s Basic,” based on its
P&I Solutions business vision.
Major changes in society and a diversifying range of problems in Japan and overseas have madeit necessary to find even better solutions for solving these problems. In particular, Japan faces a
growing need to improve the quality of life in a super aged society and to respond to energy andglobal environmental problems. These conditions offer opportunities to lead the world in addressingthese problems and deliver solutions. DNP seeks to fully leverage these opportunities and expand
its business domain based on its strengths in printing technologies and other areas. It is also
working to create a wide range of products and services that help solve various problems to realize
its catchphrase, “Today’s Innovation is Tomorrow’s Basic.”
Initiatives in the different businesses and segments[PRINTING]
Information Communication
The Information Communication segment is broadly involved with the optimal expression of
information and expansion into a diverse range of media. It also provides a wide range of solutions
that are closely connected with the business processes of our customers.
The DNP Kashiwa Data Center, which opened in December 2013, is a state-of-the-art facility witha high level of information security based on cloud computing technology and expertise frompartnering company Nihon Unisys, Ltd., and we will use this facility as a main base in the information
communication business. We are leveraging this data center to expand the “honto” hybrid bookstore
business that offers both paper books and e-books, and to move forward with consumer-directed
services such as the “Orikomio!” e-flyer service and the “Elne” loyalty point service. In the BPO
business, we are focusing on solving the problems of our customers, including through the operationof campaign offices as well as back-office centers and customer service sectors in the financial
sector.
We are also working to expand business based on the standpoint of consumers, including
shopping support services such as the “Receipi!” family budget management application.

12

Lifestyle and Industrial Supplies
The Lifestyle and Industrial Supplies segment provides products and services that properly respondto corporate clients’ and consumers’ diverse needs, including environmental protection and universal
design.
In the Packaging business, we have been manufacturing and selling packaging in Indonesia since1972, and DNP has achieved the top market share in a wide range of areas including daily goods
and foods. Leveraging this experience, we opened a packaging plant in Vietnam in May 2013, as thecountry continues to achieve high economic growth. We are providing high-value-added products
and services to global companies, including Japanese companies who are expanding overseas, bybuilding production facilities in Vietnam, which has attracted attention as a distribution base for
Indochina.
In the Information Media Supplies business, printing needs for identification and travel photos
have increased in Southeast Asia, and we have prepared a structure to respond to growing demandby completing construction in December 2013 of a plant in Malaysia to make dye-sublimation
thermal transfer printing media for photo printing. For barcode products, in May 2013 we increased
production capacity by expanding production facilities for thermal resin-type transfer printing media
for barcodes at our Pittsburgh plant in the U.S. because consumption in North America and Latin
America account for around 40% of global demand.
Our Lifestyle Materials business works closely with manufacturers of household equipment anddecorative materials, addressing the entire building industry supply chain starting with the projectplanning phase. In addition to high value-added products that use DNP’s proprietary Electron Beamcoating technology, we are pursuing the development of products suited to smart houses and smart
cities, including exterior components with superior weather resistance and energy-saving interior
components that increase illumination through efficient light diffusion.
Electronics
In the Electronics segment, we integrated the business unit responsible for display products andsemiconductor photomasks and the business unit responsible for optical films including LCD surface
films in April 2014. Both business units share major markets such as electronics, and we believe it
will be effective to combine their technology and expertise in developing new products such as touch
panel related products. We seek to respond to the rapidly changing needs of companies andconsumers by bolstering DNP’s patterning, microfabrication, and other world class technologies,
developing new high-performance products, rigorously cutting costs, and improving investment
efficiency.
In the LCD Color Filter business, we are working to stabilize operations by focusing on ourstrength in high-definition, high-quality small- and medium-sized filters for smart phones and tablets,
an area in which strong growth is expected.
In the Photomasks business, we seek to respond precisely to miniaturization needs and tap into
growing overseas demand through our overseas production facilities.
For optical films, we are focusing on developing new products, mainly for flat-panel displays, thatleverage clean converting technologies to increase quality based on coating, laminating, and othertechnologies.
[BEVERAGES]
Beverages
In the beverage industry, we expect the business environment to remain harsh as companies
respond to the consumption tax hike in April 2014 and face earnings pressure from higher sales

13

promotion costs amid stiffer competition for market share.
Given these conditions, we drew up a medium-term management plan that proposes a vision ofcontributing to Hokkaido through Coca-Cola’s brand strength and the community-based capabilitiesof our subsidiaries in Hokkaido. Based on this plan, we will pursue four strategies aimed at achieving
sustained growth: “blazing a new trail,” “winning in the marketplace,” “offering new value,” and“implementing group-wide cost control.” Additionally, with the goal of being a company that is trusted
and recognized by local communities, we are working to bolster corporate governance by building
and operating internal control systems and to maintain and improve quality, food safety, theenvironment, and occupational safety and health based on Coca-Cola’s propriety integrated
management system called KORE.
Expansion of contact with consumers
DNP opened facilities to enable direct contact with consumers in Tokyo and Osaka in 2013. We areconducting planning in cooperation with these facilities and working to deepen our communication
with consumers to gain a better understanding of their problems and expand business that offer
solutions to these problems.
In Tokyo, we opened the “Communication Plaza dot DNP,” a hands-on showroom that allows
consumers to enjoy DNP’s various products and services, in Ichigaya Tamachi, Shinjuku in January
2013. This facility includes the “honto Cafe” for consumers to try reading e-books such as novels,
comics, and magazines on tablet devices, the “Enjoy! Photo Park” for consumers to experiencetaking and printing photos in a specially built studio, and the “Digital Picture Book Museum” forparents and their children to enjoy digital picture books from Japan and overseas, and we have also
held a variety of events at this facility. It has been used by a large number of people, attracting
around 50,000 visitors during the first year after opening.
In Osaka, we opened the “Cafe Lab.” in Knowledge Capital, a multi-use facility inside Grand Front
Osaka where companies, universities, and research institutes pursue cross-sector collaboration, in
April 2013. We opened this communication cafe together with Pronto Corporation, and we offer
books carefully selected by staff on the bookshelves and tablet devices to read e-books on thetables. We conduct participatory workshops for consumers to enjoy learning through conversationand experience, and have created a place to spark their intellectual curiosity.
Strengthened organization
DNP aims to increase its overall group strength by further reinforcing cooperation among businessdivisions and to offer a wide range of solutions by deepening taiwa (exchange of viewpoints andideas that leads to identification and resolution of problems) with companies and consumers toactively develop new products and services that contribute to accurate problem-solving. In order toexpand DNP’s business, we will pursue cooperation with other companies that have various
strengths in addition to making the most of our own unique technologies. We have already formed
strategic alliances with other companies and implemented mergers and acquisitions in suchbusinesses as information communication, publications distribution, digital photos, and electronics.
In the future, we will continue to actively pursue such alliances both domestically and overseas.
In addition, we are moving ahead with the redevelopment of Tokyo’s Ichigaya district, in order tofurther promote our business vision of providing P&I Solutions. Currently the project planning andsales offices of various business units are scattered throughout the Tokyo Metropolitan area. We willconcentrate these in the Ichigaya district, together with DNP group headquarters functions. We arebolstering cooperation by leveraging our various strengths. On this basis, we are actively pursuing14the integration of production sites through the reform of our production and distribution structures
while working to expand existing businesses and develop new businesses. We began thisredevelopment project in 2010, and aim to complete it in 2018.
Reinforcing DNP’s business continuity plan (BCP)
Aiming for a “disaster-proof DNP Group,” we established the “DNP Group Basic Code for Disaster
Response” and we implement disaster prevention and preparedness measures on a daily basis inline with our disaster prevention plan. After the Tohoku–Pacific Ocean Earthquake, we reviewed ourbusiness continuity plan (BCP), reconsidered our overall product supply chain, enhanced
distribution and alternative production systems, and reconfigured our production bases in Japan andoverseas in order to minimize the potential impact that a disaster could have on our business. In
addition, in response to power shortages and price hikes, we will continue to carefully conserve
energy and introduce in-house power generation equipment.
Contributing to the realization of a sustainable society
Global climate change is a growing concern, including rising temperatures and water shortages.
DNP’s various environmental initiatives to build a sustainable society that coexists with natureinclude a proprietary environmental management system, global warming prevention, zero waste
emissions, biodiversity protection, thorough management of volatile organic solvent and chemical
substance, and green purchasing.
In the fiscal year ended March 31, 2014, we calculated greenhouse gas emissions (Scope3) inJapan and overseas not only for our manufacturing operations, but also indirect emissions
throughout our entire supply chain. We started working toward the global reduction of greenhousegas emissions. We also prepared targets for water usage volume at the manufacturing stage andlaunched reduction activities. Paper is a main material for printing, and we understand that ourbusiness activities depend heavily and have a large impact on the ecosystem, and are deeply
related to climate change. We have prepared paper procurement guidelines with the aim ofmaintaining sustainable forest resources, and are working together with our suppliers.

15

4. Consolidated financial statements(1) Consolidated balance sheets(Million yen)
Year ended March 31, 2013
(As of March 31, 2013)

Year ended March 31, 2014
(As of March 31, 2014)

213,630
367,765
91,04729,03018,977
10,27723,305(2,883)751,150

203,212356,981
91,681
28,50919,464
8,677
27,319(2,791)
733,054529,760(333,740)
196,019
818,946(689,595)
129,350
154,005
22,921
138,564(102,406)
36,157538,454

536,978(341,652)
195,326
787,368(668,465)
118,903
153,159
27,577
138,791(105,220)
33,571
528,538

7,481
25,5162,482
35,4804,477
25,0262,246
31,751

189,657
9,658
25,167–35,385(5,977)
253,890827,825
1,578,976

217,059
9,078
11,083
19,23430,801(5,848)281,409841,699
1,574,753

ASSETS
Current assets
Cash and time deposits
Notes and trade receivable
Merchandise and finished products
Work in progress
Raw materials and supplies
Deferred income taxes
Other
Allowance for doubtful accounts
Total current assets
Fixed assets
Property, plant and equipment
Buildings and structures
Accumulated depreciation
Buildings and structures, net
Machinery and equipment
Accumulated depreciation
Machinery and equipment, net
LandConstruction in progress
Other
Accumulated depreciation
Other, net
Total property, plant and equipment
Intangible fixed assets
Goodwill
Software
Other
Total intangible fixed assets
Investments and other assets
Investment securities
Long-term loans
Deferred income taxes
Net defined benefit asset
Other
Allowance for doubtful accounts
Total investments and other assets
Total fixed assets
TOTAL ASSETS

16

(Million yen)
Year ended March 31, 2013
(As of March 31, 2013)

Year ended March 31, 2014
(As of March 31, 2014)

249,567
47,296
6,805
50,7609,014
16,00478,336
457,784

249,604
48,961
12,4801,850
8,942
17,31079,272
418,422

102,800
19,5482,170
26,441–33,175
184,135
641,920

101,800
17,5052,231–
29,55028,857
179,945598,367

114,464
144,898
722,057(94,226)
887,193

114,464
144,898
727,070(94,322)892,110

18,90834,597

8(12,986)
–

3
144
5,473

5,930

40,21816
43,915937,055
1,578,976

16
44,040976,386
1,574,753

LIABILITIESCurrent liabilities
Notes and trade payable
Short-term bank loans
Current portion of long-term debt
Current portion of bonds
Income taxes payable
Reserve for bonuses
Other
Total current liabilities
Long-term liabilities
Bonds
Long-term debt
Deferred tax liabilities
Provision for retirement benefits
Net defined benefit liability
Other
Total long-term liabilities
TOTAL LIABILITIESNET ASSETSStockholders’ equity
Common stock
Capital surplus
Retained earnings
Treasury stock
Total stockholders’ equity
Accumulated other comprehensive income
Valuation difference on available-for-salesecurities
Net deferred gains on hedges
Foreign currency translation adjustments
Remeasurements of defined benefit plans
Total accumulated other comprehensive
incomeStock acquisition rights
Minority interests
TOTAL NET ASSETSTOTAL LIABILITIES AND NET ASSETS

17

(2) Consolidated statements of income and comprehensive income
Consolidated statements of income(Million yen)

Net sales
Cost of sales
Gross profit
Selling, general and administrative expenses
Operating income
Non-operating income
Interest and dividends income
Equity in earnings of affiliates
Other
Total non-operating income
Non-operating expenses
Interest expense
Contributions
Other
Total non-operating expenses
Ordinary income
Extraordinary gains
Gain on sale of fixed assets
Gain on sale of investment securities
Other
Total extraordinary gains
Extraordinary losses
Loss on sale or disposal of fixed assets
Impairment loss
Loss on devaluation of investment securities
Other
Total extraordinary losses
Income before income taxes and minority
interests
Current income taxes
Deferred income taxes
Total income taxes
Income before minority interests
Minority interests (losses)
Net income

18

Year ended
March 31, 2013
1,446,607
1,186,557
260,049
224,269
35,779Year ended
March 31, 2014
1,448,550
1,176,077
272,472
222,374
50,098

3,464
3,012
8,356
14,833

3,738
742
6,027
10,507

3,482
1,046
5,765
10,29540,318

2,914
1,074
3,331
7,320
53,285

9,321
155
710
10,187

1,009
348
960
2,318

6,478
3,563
2,659
2,652
15,353

4,870
140
330
1,654
6,995

35,151

48,60817,079(314)
16,765
18,386(831)
19,217

14,588
7,224
21,813
26,794
1,153
25,641

Consolidated statements of comprehensive income(Million yen)

Income before minority interests
Other comprehensive income
Valuation difference on available-for-salesecurities
Net deferred gains on hedges
Foreign currency translation adjustments
Share of other comprehensive income ofassociates accounted for using equity method
Total other comprehensive income
Comprehensive income
Attributable to：Shareholders of parent company
Minority interests

19

Year ended
March 31, 2013
18,386

Year ended
March 31, 2014
26,794

14,29015,124

79,276

1
13,098161

697

23,73542,121

28,92355,71742,568(446)

54,4561,260

(3) Consolidated statements of changes in net assets
The year ended March 31, 2013 (April 1, 2012 – March 31, 2013)(Million yen)
Stockholders’ equity

Balance at the beginningof current period
Changes of items during
the period
Cash dividends paid
Net income
Change of scope of
consolidation
Purchases of treasury
stock
Disposal of treasury
stock
Increase in treasury
stock from increase inequity-method affiliates
Net changes in items
other thanstockholders’ equity
Total changes of items
during the period
Balance at the end ofcurrent period

Totalstockholders’equityCommonstock

CapitalsurplusRetainedearnings

Treasurystock

114,464

144,898

723,459(94,172)888,649(20,626)
19,217(20,626)
19,217

17

17

(10)

(38)

(38)

16

6

(32)

(32)

–
–

–

(1,401)(53)(1,455)

114,464

144,898

722,057(94,226)

887,193

Accumulated other comprehensive income

Balance at the beginningof current period
Changes of items during
the period
Cash dividends paid
Net income
Change of scope of
consolidation
Purchases of treasury
stock
Disposal of treasury
stock
Increase in treasury
stock from increase inequity-method affiliates
Net changes in items
other thanstockholders’ equity
Total changes of items
during the period
Balance at the end ofcurrent period

Valuationdifference on
available-forsale securities

Net deferredgains (losses)on hedges

Foreigncurrencytranslation
adjustments

Remeasurements ofdefined benefit
plans

Total
accumulated
othercomprehensive
incomeStockacquisitionrights

4,370

(14)

(21,775)–(17,420)

16

Minority
interests

42,967

Total net
assets914,213(20,626)
19,217
17
(38)
6
(32)

14,538

23

8,788

–

23,350–947

24,298

14,538

23

8,788

–

23,350–947

22,842

18,908

8(12,986)

–

5,930

16

43,915937,055

20

The year ended March 31, 2014 (April 1, 2013 – March 31, 2014)(Million yen)
Stockholders’ equity

Balance at the beginningof current period
Changes of items during
the period
Cash dividends paid
Net income
Change of scope ofequity method
Purchases of treasury
stock
Disposal of treasurystock
Net changes in items
other thanstockholders’ equity
Total changes of items
during the period
Balance at the end ofcurrent period

Totalstockholders’equityCommonstock

CapitalsurplusRetainedearnings

Treasurystock

114,464

144,898

722,057(94,226)

887,193(20,624)
25,641(20,624)
25,641

(3)

(3)

(0)

(97)

(97)

1

0
–

–

–

5,012

(95)

4,916

114,464

144,898

727,070(94,322)892,110

Accumulated other comprehensive income

Balance at the beginningof current period
Changes of items during
the period
Cash dividends paid
Net income
Change of scope ofequity method
Purchases of treasury
stock
Disposal of treasurystock
Net changes in items
other thanstockholders’ equity
Total changes of items
during the period
Balance at the end ofcurrent period

Valuationdifference on
available-forsale securities

Net deferredgains (losses)on hedges

Foreigncurrencytranslation
adjustments

Remeasurements ofdefined benefit
plans

Total
accumulated
othercomprehensive
incomeStockacquisitionrights

18,908

8(12,986)

–

5,930

16

Minority
interests

43,915

Total net
assets937,055(20,624)
25,641(3)(97)
015,689(5)

13,131

5,473

34,288–125

34,413

15,689(5)

13,131

5,473

34,288–125

39,33034,597

3

144

5,473

40,21816

44,040976,38621

(4) Consolidated statements of cash flows(Million yen)

Year ended
March 31, 2013
Cash flows from operating activities
Income before income taxes and minority interests
Depreciation
Impairment loss
Decrease of doubtful receivables, net
Decrease of provision for retirement benefits, net
Increase of net defined benefit asset
Increase of net defined benefit liability
Equity in gains of affiliates
Amortization of consolidation goodwill, net
Interest and dividend income
Interest expense
Net gain on sales of investment securities
Net loss on devaluation of investment securities
Net losses (gains) on sale or disposal of fixed assets
Decrease in trade receivables
Decrease in inventories
Decrease in trade payables
Other
Sub-total
Payments for extra retirement payments
Payment of income taxes
Net cash provided by operating activities
Cash flows from investing activities
Net increase in time deposits
Payments for purchases of property, plant andequipment
Proceeds from sales of property, plant and equipment
Payments for purchases of investment securities
Proceeds from sales of investment securities
Proceeds from purchase of stock in subsidiaries
resulting in change in scope of consolidation
Proceeds from transfer of business
Interest and dividends received
Other
Net cash used in investing activities

22

Year ended
March 31, 201435,15180,2003,563(1,043)(6,694)––(3,012)
3,019(3,464)
3,482
(140)
2,691
(2,816)
19,481
12,295(31,665)
8,638
119,689(1,703)(17,487)
100,497

48,60873,458140(515)–(7,478)
718
(742)
3,648
(3,738)
2,914
(384)
488
3,898
15,084
3,042(6,147)
1,702
134,698(249)(14,341)
120,108(275)(1,484)(66,216)(54,875)

14,718(14,138)489

7,167(7,921)
1,231

–

796

8,091
3,971
(19,227)(72,587)–
5,126(8,412)(58,370)

(Million yen)

Year ended
March 31, 2013
Cash flows from financing activities
Net increase (decrease) in short-term bank loans
Proceeds from long-term debt
Repayments of long-term debt
Proceeds from issuance of bonds
Payments for redemption of bonds
Proceeds from stock issuance to minority shareholders
Payments for purchases of treasury stock
Payments for purchases of treasury stock of subsidiaries
Interest paid
Dividends paid
Dividends paid to minority interests
Other
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
Decrease in cash and cash equivalents resulting fromchange of scope of consolidation
Cash and cash equivalents at end of year

23

Year ended
March 31, 2014

(5,490)7,450(6,437)
500
(660)
1,882
(38)
(1)
(3,494)(20,626)(405)(8,914)(36,236)

168
9,227(7,453)
850(50,760)–(97)(1)(2,955)(20,625)(440)(7,950)(80,038)

4,133

6,051

(4,192)
216,279(12,248)
212,062(25)–

212,062

199,813(5) Notes regarding consolidated financial statements[Notes on premise of a going concern]
None[Basis of presenting consolidated financial statements]
1) Scope of consolidation and application of the equity method of accounting
Number of consolidated subsidiaries: 119
Major companies:
Maruzen CHI Holdings Co., Ltd.
Hokkaido Coca-Cola Bottling Co., Ltd.
INTELLIGENT WAVE INC.
BUNKYODO GROUP HOLDINGS CO., LTD.
SHUFUNOTOMO Co., Ltd., 2Dfacto, Inc.
DNP Color Techno Kameyama Co., Ltd.
DNP Technopack Co., Ltd., DNP Fine Chemicals Co., Ltd.
DNP Logistics Co., Ltd.
Number of equity-method affiliated companies: 12
Major companies:
Nihon Unisys, Ltd.
BOOKOFF CORPORATION LIMITED, All About, Inc.
Kyoiku Shuppan Co., Ltd., DIC Graphics Corporation
2) Changes in scope of consolidation and application of the equity method of accounting(Scope of consolidation)
Newly included:
2 SHUFUNOTOMO Co., Ltd. and one other company
Excluded:
3 DNP Color Techno Sakai Co., Ltd. and two other companies(Application of equity method)
Newly included:2
Excluded:
3

Will Smart Co., Ltd. and one other company
SHUFUNOTOMO Co., Ltd. (changed to consolidated
subsidiary) and two other companies

3) Matters concerning the fiscal years of consolidated subsidiaries
Of the consolidated subsidiaries, Hokkaido Coca-Cola Bottling Co., Ltd. and 26 others have fiscal
years that end on December 31, while Maruzen CHI Holdings Co., Ltd. and 23 others have fiscal
years that end on January 31. Their financial statements as of the same date are used in the
preparation of these consolidated financial statements.
Additionally, INTELLIGENT WAVE INC.’s fiscal year ends on June 30, BUNKYODO GROUPHOLDINGS CO., LTD. and seven other companies have fiscal years that end on August 31, andmobilebook.jp, Inc.’s fiscal year ends on September 30. Consequently, financial statements basedon provisional account settlements are used.
Any material transactions during the time between the foregoing settlement dates and provisional
settlement dates and the consolidated settlement date are adjusted for on a consolidated basis.

244) Summary of significant accounting policies(a) Criteria and methods for valuing significant assets• Marketable securities
Other securitiesThose with market
prices available

Fair market value based on market prices as of the balance
sheet date
(The related valuation differences are directly included in net
assets and cost of sales is computed mainly by themoving-average method.)Those without market
prices available

Mainly cost based on the moving-average method• Derivatives

Mainly fair market value• Inventories

For figures shown on the balance sheet, the book value
write-down method based on the decrease in profitability isused.

Merchandise

Mainly cost based on the specific identification method

Finished products, work inprogress

Mainly cost based on the retail inventory cost method

Raw materials

Mainly cost based on the moving-average method

Supplies

Mainly cost based on the most recent purchase method(b) Depreciation and amortization of significant assets• Property, plant and equipment The Company and its domestic consolidated subsidiaries(except for lease assets)
use the declining balance method.
However, depreciation of machinery and equipment at theKurosaki Plant No. 1 (2nd-Stage plant) and Plant No. 3 iscomputed by the straight-line method.
Depreciation of buildings (excluding building fixtures)acquired after April 1, 1998, is computed by the straight-line
method.
Assets with an acquisition cost of at least ¥100,000 and lessthan ¥200,000 are depreciated mainly over three years by
the straight-line method. Foreign consolidated subsidiaries
mainly use the straight-line method.
• Intangible fixed assets(except for lease assets)

Mainly the straight-line method
Software used internally is amortized using the straight-line
method over the Company’s estimate of the useful life of theassets (five years).

• Lease assets

Lease assets with no transfer of ownership
These lease assets are depreciated over the lease periodusing the straight-line method with no residual value.
Finance lease transactions that do not transfer ownershipand commenced on or before March 31, 2008 are
accounted for based on the method for ordinary leasetransactions.

25

(c) Basis for recording significant allowances• Allowance for doubtful
To cover possible losses on doubtful accounts, theaccounts
allowance for doubtful accounts is based on historicaldefault rates for normal accounts and on estimates of theamounts that may not be recoverable for specific overdue
accounts.
• Reserve for bonuses

To cover payments of employee bonuses in the following
fiscal year, the reserve for bonus is based on the estimatedamount that is attributable to the current fiscal year.

(d) Accounting treatment of retirement benefits
In calculating retirement benefit obligations, straight-line attribution is used to allocate expected
retirement benefit payments in the period until the end of the current fiscal year.
Prior service costs are amortized using the straight-line method over a certain number ofyears that is equal to or less than the average future service period of eligible employees at thetime the costs are incurred (generally six years).
Actuarial gains/losses are amortized starting in the next fiscal year after they are incurred
using the declining balance method over a certain number of years that is equal to or less than
the average future service period of eligible employees at the time the actuarial gains/losses
are incurred (generally nine years).
(e) Accounting treatment of consumption taxes
National and local consumption taxes are excluded from transaction amounts.
(f) Amortization of goodwill and negative goodwill
Goodwill and negative goodwill incurred prior to and on March 31, 2010 are amortized using
the straight-line method for a period of not more than 20 years. In the current fiscal year,
straight-line amortization over five years is generally used.
(g) Scope of funds in the consolidated statements of cash flows
Cash and cash equivalents in the consolidated statements of cash flows are short-term
investments with an original maturity of three months or less, are subject to insignificant risk ofchanges in value, and can be easily converted into cash and drawable funds as needed.
[Changes in accounting policies]
DNP has adopted the “Accounting Standard for Retirement Benefits” (ASBJ Statement No. 26, May
17, 2012) and “Guidance on Accounting Standard for Retirement Benefits” (ASBJ Guidance No. 25,
May 17, 2012) from the end of the current fiscal year, except for the provisions of the main clauses inParagraph 35 of the Accounting Standard for Retirement Benefits and Paragraph 67 of the
Guidance on Accounting Standard for Retirement Benefits. Accordingly, it has switched to a methodof subtracting the amount of plan assets from retirement benefit obligations and recording thedifference as net defined benefit liability or net defined benefit asset, and has recorded unrecognizedactuarial gains/losses and unrecognized prior service costs under net defined benefit liability and net
defined benefit asset.
With the adoption of the Accounting Standard for Retirement Benefits, in accordance with thetransitional treatment stipulated in Paragraph 37 of the Accounting Standard for Retirement Benefits,
DNP will add or subtract the amount of the impact from this change in remeasurements of defined
benefit plans under accumulated other comprehensive income at the end of the current fiscal year.

26

As a result, at the end of the current fiscal year, DNP recorded net defined benefit liability of¥29.55 billion and net defined benefit asset of ¥19.234 billion. Accumulated other comprehensive
income also increased by ¥5.473 billion.
The impact on per share information is listed in the relevant section.
[Consolidated balance sheets]

1. Guarantee obligation
2. Discounts on notes receivableYear ended
March 31, 2013¥34 million¥643 million

Year ended
March 31, 2014
¥33 million¥664 million

Year ended
March 31, 2013
¥30,820 million

Year ended
March 31, 2014
¥30,820 million[Consolidated statements of income]

1. Research and development expenses(Selling, general and administrative expenses, and cost of sales)[Consolidated statements of changes in net assets]
The year ended March 31, 2013 (April 1, 2012 – March 31, 2013)
1. Types and number of shares outstanding and treasury stock(Shares)Number ofshares at the
beginning of
the year
ended March2013

Stock type

Increase in
number ofshares during
the year
ended March2013

Decrease in
number ofshares during
the year
ended March
2013

Number ofshares at theend of theyear ended
March 2013

700,480,693
700,480,693––
Treasury stock
Common stock
56,417,765
82,541
9,977
56,490,329
Notes:
1. Treasury stock increased by 82,541 shares, comprising 58,810 shares from the repurchase of
odd-lot shares and 23,731 shares from the return of shares resulting from an increase inequity-method affiliates.
2. The decrease of 9,977 treasury shares is due to the sale of odd-lot shares.
Outstanding shares

Common stock

2. Stock acquisition rights and treasury stock acquisition rights
Number of shares (Shares)
Company name

Consolidated
subsidiary

Breakdown

Stockacquisitionrights as stock
optionTotal

Balance atthe end of
the year
ended
March 2013
(Million yen)

Stock
type

Beginning of
the year
ended March
2013

Increase

Decrease

End of theyear ended
March 2013

–

–

–

–

–

16

–

–

–

–

16

27

3. Detailed information regarding dividends(1) Dividends paid
Resolution

Total dividends

Stock type

General meeting ofshareholders on
June 28, 2012
Board of Directors’
meeting on
November 8, 2012

(Million yen)

Dividend pershare (Yen)Dividend
record date

Effective dateCommon stock

10,31316

March 31,2012

June 29, 2012

Common stock

10,31316

September 30,
2012

December 10,
2012(2) Of dividends for which the record date belongs to the current fiscal year, those thatcome into effect in the following fiscal year
Resolution

Total
dividends

Stock type(Million yen)

General meeting ofshareholders on
June 27, 2013

Commonstock

Dividend
per share

Source ofdividends(Yen)

Retainedearnings

10,312

16

Dividend
record date

Effective
date

March 31,2013

June 28,2013

The year ended March 31, 2014 (April 1, 2013 – March 31, 2014)
1. Types and number of shares outstanding and treasury stock(Shares)Number ofshares at the
beginning of
the year
ended March2014

Stock type

Increase in
number ofshares during
the year
ended March2014

Decrease in
number ofshares during
the year
ended March2014

Number ofshares at theend of theyear ended
March 2014

700,480,693
700,480,693––
Treasury stock
Common stock
56,490,329
97,392891
56,586,830
Notes:
1. The increase of 97,392 treasury shares is due to the repurchase of odd-lot shares.
2. The decrease of 891 treasury shares is due to the sale of odd-lot shares.
Outstanding shares

Common stock

2. Stock acquisition rights and treasury stock acquisition rights
Balance atthe end of
the year
ended
March 2014
(Million yen)

Number of shares (Shares)
Company name

Consolidated
subsidiary

Breakdown

Stock
type

Beginning of
the year
ended March
2014

Increase

Decrease

End of theyear ended
March 2014

–

–

–

–

–

16

–

–

–

–

16

Dividend pershare (Yen)Dividend
record date

Effective dateStockacquisitionrights as stock
optionTotal

3. Detailed information regarding dividends(1) Dividends paid
Resolution
General meeting ofshareholders on
June 27, 2013
Board of Directors’
meeting on
November 7, 2013

Stock type

Total dividends(Million yen)

Common stock

10,31216

March 31,2013

June 28,
2013

Common stock

10,31116

September 30,
2013

December 10,
2013

28

(2) Of dividends for which the record date belongs to the current fiscal year, those thatcome into effect in the following fiscal year
Resolution

Stock type

Total
dividends(Million yen)

General meeting ofshareholders on
June 27, 2014

Commonstock

10,311

Source ofdividends
Retainedearnings

Dividend
per share
(Yen)

16

Dividend
record date

Effective
date

March 31,2014

June 30,
2014[Segment information, etc.]
1. Overview of the reporting segments
DNP’s reporting segments are regularly reviewed by the Board of Directors using thesegregated financial information available within each segment to determine the allocation ofbusiness resources and evaluate business results.
DNP bases its business divisions on the products and services provided and develops its
business activities based on a comprehensive domestic and overseas strategy for eachbusiness division. The four reporting segments are Information Communication, Lifestyle andIndustrial Supplies, Electronics, and Beverages.
Information Communication is involved in the production and sale of publications,commercial printed matter, and business forms and in educational and publications
distribution. Lifestyle and Industrial Supplies is involved in the production and sale ofpackaging materials, interior and exterior construction materials, photographic materials, andindustrial supplies. Electronics is involved in the production and sale of precision electronic
components and other products. Beverages is involved in the production and sale ofcarbonated and non-carbonated beverages.
2. Method of calculating sales, income/loss, assets, and other items by reporting segment
The accounting method used for reporting business segments is generally the same as statedin “Basis of presenting consolidated financial statements.”
Reporting segment income (loss) figures are based on operating income (loss).
Inter-segment sales and transfers are based on third-party transaction prices.

29

3. Information on sales, income/loss, assets, and other items by reporting segment
The year ended March 31, 2013 (April 1, 2012 – March 31, 2013)
Reporting segment

Net sales
Outside customers
Inter-segment
Total
Segment income (loss)
Segment assets
Other items
Depreciation andamortization
Amortization of
goodwill
Impairment loss
Increase in property,
plant and equipment
and in intangible fixed
assets
Notes:

1.

2.

(Million yen)Amounts
reported on
Adjustment
consolidated
Note 1
financialstatements Note 2

Information
Communication

Lifestyle andIndustrial
Supplies

Electronics

698,362
6,364
704,727
15,944
606,572

511,464
9,960
521,425
28,028583,120

180,5061
180,507(304)
238,828

56,273
2
56,276
470
45,887

1,446,607
16,3281,462,935
44,1391,474,408–(16,328)(16,328)(8,359)104,568

1,446,607–
1,446,607
35,7791,578,976

22,255

26,46725,956

3,976

78,656

1,544

80,200

1,533

1,410

325

0

3,270

–

3,270

704

2,761

9

32

3,508

55

3,563

27,26732,596

20,128

7,114

87,1071,206

88,314Beverages

Total

Figures are adjusted as follows.
(1) Segment income (loss) is adjusted for costs related to basic research not assignable to areporting segment or costs of research shared by different segments.
(2) Segment assets are adjusted for companywide assets not allocated to reporting segments.
(3) Increases in property, plant and equipment and in intangible fixed assets are adjusted forcapital expenditures for the head office building and other items.
Segment income (loss) is adjusted to reflect operating income as reported in the consolidated
financial statements.

The year ended March 31, 2014 (April 1, 2013 – March 31, 2014)
Reporting segment

Net sales
Outside customers
Inter-segment
Total
Segment income
Segment assets
Other items
Depreciation andamortization
Amortization of
goodwill
Impairment loss
Increase in property,
plant and equipment
and in intangible fixed
assets
Notes:

1.

2.

(Million yen)Amounts
reported on
Adjustment
consolidated
Note 1
financialstatements Note 2

Information
Communication

Lifestyle andIndustrial
Supplies

Electronics

694,947
5,355
700,303
11,900629,818

527,456
6,122
533,579
33,910599,910

171,3401
171,341
12,930229,266

54,804
3
54,808651
45,4701,448,550
11,482
1,460,032
59,394
1,504,464–(11,482)(11,482)(9,295)70,2881,448,550–
1,448,550
50,0981,574,753

21,95625,534

20,622

3,909

72,023

1,435

73,458

2,665

1,101

100

0

3,868

–

3,868

134

–

–

6

140

–

140

23,681

26,287

9,002

3,559

62,530934

63,464Beverages

Total

Figures are adjusted as follows.
(1) Segment income is adjusted for costs related to basic research not assignable to a reporting
segment or costs of research shared by different segments.
(2) Segment assets are adjusted for companywide assets not allocated to reporting segments.
(3) Increases in property, plant and equipment and in intangible fixed assets are adjusted forcapital expenditures for the head office building and other items.
Segment income is adjusted to reflect operating income as reported in the consolidated financial
statements.

30

(Related information)
The year ended March 31, 2013 (April 1, 2012 – March 31, 2013)
1. Information on products and services
Omitted because similar information is disclosed in segment information.
2. Regional information(1) Net sales(Million yen)Japan
1,250,987
Notes:

1.
2.
3.

Asia

Other regions

137,537

Total

58,082

1,446,607

Sales are classified by country or region, based on the location of customers.
Country and regional segments are based on geographic proximity.
Main countries and regions included in each segment:
Asia:
Taiwan, South Korea, China, Indonesia
Other:
United States, France, Germany, United Kingdom(2) Property, plant and equipment
Omitted because the value of property, plant and equipment located in Japan is over 90%of the value of property, plant and equipment as reported in the consolidated balance
sheets.
3. Information on major customers
Not described because sales to specific outside customers are less than 10% of sales asreported in the consolidated statements of income.
The year ended March 31, 2014 (April 1, 2013 – March 31, 2014)
1. Information on products and services
Omitted because similar information is disclosed in segment information.
2. Regional information(1) Net sales(Million yen)Japan
1,232,092
Notes:

1.
2.
3.

Asia

Other regions

152,500

Total

63,956

1,448,550

Sales are classified by country or region, based on the location of customers.
Country and regional segments are based on geographic proximity.
Main countries and regions included in each segment:
Asia:
Taiwan, South Korea, China, Indonesia
Other:
United States, France, Germany, United Kingdom(2) Property, plant and equipment
Omitted because the value of property, plant and equipment located in Japan is over 90%of the value of property, plant and equipment as reported in the consolidated balance
sheets.
3. Information on major customers
Not described because sales to specific outside customers are less than 10% of sales asreported in the consolidated statements of income.

31[Per share information]
Year ended March 31, 2013
(April 1, 2012 – March 31, 2013)

Year ended March 31, 2014
(April 1, 2013 – March 31, 2014)

Net assets per share¥1,386.86

Net assets per share¥1,447.96

Net income per share¥29.84

Net income per share¥39.82

Diluted net income per share¥29.79Diluted net income per share¥39.65

Year ended
March 31, 2013

Year ended
March 31, 2014

(As of March 31,
2013)(As of March 31,
2014)

Note: Basis of calculations
1. Net assets per share(Million yen)

937,055
43,931
16
43,915976,386
44,05616
44,040(Million yen)893,124

932,329(Thousand shares)(Thousand shares)

700,480
56,490700,480
56,586(Thousand shares)

643,990643,893

Year ended
March 31, 2013
(April 1, 2012 –March 31, 2013)

Year ended
March 31, 2014
(April 1, 2013 –March 31, 2014)

Total net assets(Million yen)Amount excluded from total net assets(Million yen)

Of which, stock acquisition rights
Of which, minority interests
Net assets at fiscal year-end pertaining to common
stock
Number of common shares outstanding(Million yen)

Number of common treasury shares
Number of common shares at fiscal year-end used
for the calculation of net assets per share

2. Net income per share and diluted net income per share(1) Net income per share
Net income
Amounts not attributable to commonshareholders
Net income pertaining to common stock
Average number of common shares outstanding
during the fiscal year(2) Diluted net income per share(Million yen)

19,21725,641(Million yen)––

(Million yen)

19,21725,641(Thousand shares)

644,029

643,945

Net income adjustment
Of which, impact of dilutive stock of consolidated
subsidiaries and affiliates
Increase in common stock(Million yen)

(31)

(110)

(Million yen)

(31)

(110)

–

–

(Thousand shares)

3. As noted in “Changes in accounting policies,” DNP has adopted the Accounting Standard for
Retirement Benefits, etc, and applied the transitional treatment stipulated in Paragraph 37 of the
Accounting Standard for Retirement Benefits.
As a result, net assets per share in the current fiscal year increased by ¥8.5.
[Significant subsequent events]
DNP established a joint venture through an absorption-type merger in which DNP specified
subsidiary DNP Photomask Technology Taiwan Co., Ltd. (DPTT) was absorbed by Photronics, Inc.
subsidiary Photronics Semiconductor Mask Corp. (PSMC) on April 4, 2014.

32

Outline of the business divestiture(1) Name of successor company
Photronics Semiconductor Mask Corp.
(2) Description of divested business
Semiconductor photomask business in Taiwan.
(3) Main reason for business divestiture
Further enhance the competitiveness of the photomask business.
(4) Business divesture date
April 4, 2014
(5) Outline of other transactions including legal form
Absorption-type merger with DPTT as the non-surviving company and PSMC as thesurviving company. PSMC changed its name to Photronics DNP Mask Corporation after themerger, allocated 49.99% of its common stock to the Company, and will be treated as anequity-method affiliate by the Company.
[Disclosure omission]
Disclosure of notes on such items as tax effect accounting, marketable securities, and retirement
benefits is omitted because such disclosure in the release of Financial Results is not considered to
be important.

33

5. Non-consolidated financial statements(1) Non-consolidated balance sheets(Million yen)

Year ended
March 31, 2013
(As of March 31, 2013)

Year ended
March 31, 2014
(As of March 31, 2014)

133,226
33,717
253,860
3,759
11,4452,061
4,476
25,330(1,261)
466,616

110,844
33,050243,102
3,344
11,042
1,990
4,123
29,032(1,688)434,842

398,871(250,004)
148,867
31,685(24,381)
7,304
637,526(552,208)
85,317
1,282(1,089)193
49,174(41,462)
7,711
131,483
2,529(1,317)
1,211
16,098398,187

402,951(258,561)
144,389
31,867(24,998)
6,869
617,999(542,954)
75,044
1,267(1,123)
144
50,268(42,324)
7,944
131,026
2,293(1,220)1,073
22,374
388,866

18,3044,580
22,884

19,581
3,555
23,137

153,566
149,719
2,008
16,821
17,36137,815(17,016)
360,275
781,347
1,247,963

180,126
154,4542,213
12,753
6,625
36,931(11,470)
381,634
793,638
1,228,480

ASSETS
Current assets
Cash and time deposits
Notes receivable
Trade receivable
Merchandise and finished goods
Work in progress
Raw materials and supplies
Deferred income taxes
Other
Allowance for doubtful accounts
Total current assets
Fixed assets
Property, plant and equipment
Buildings
Accumulated depreciation
Buildings, net
Structures
Accumulated depreciation
Structures, net
Machinery
Accumulated depreciation
Machinery, net
VehiclesAccumulated depreciation
Vehicles, net
Equipment
Accumulated depreciation
Equipment, net
Land
Lease asset
Accumulated depreciation
Lease asset, net
Construction in progress
Total property, plant and equipment
Intangible fixed assets
Software
Other
Total intangible fixed assets
Investments and other assets
Investment securities
Investments in securities in affiliates
Investments in capital of affiliates
Long-term loans
Deferred income taxes
Other
Allowance for doubtful accounts
Total investments and other assets
Total fixed assets
TOTAL ASSETS

34

(Million yen)
Year ended
March 31, 2013
(As of March 31, 2013)

LIABILITIESCurrent liabilities
Notes payable
Trade payable
Current portion of bonds
Lease obligations
Accounts payable - otherAccrued expenses
Deposits payable
Reserve for bonuses
Reserve for bonuses to directors
Reserve for disaster losses
Provision for loss on liquidation of affiliates
Notes payable for facilities
Other
Total current liabilities
Long-term liabilities
Bonds
Lease obligations
Asset retirement obligations
Long-term accounts payable
Provision for retirement benefits
Reserve for environmental measures
Total long-term liabilities
TOTAL LIABILITIESNET ASSETSStockholders’ equity
Common stock
Capital surplus
Capital reserve
Total capital surplus
Retained earnings
Legal reserve
Other retained earnings
Reserve for special depreciation
Reserve for depreciation reduction of fixed
assetsOther reserve
Retained earnings brought forward
Total retained earnings
Treasury stock
Total stockholders’ equity
Valuation and translation adjustments
Valuation difference on available-for-salesecurities
Net deferred gains (losses) on hedges
Total valuation and translation adjustments
TOTAL NET ASSETSTOTAL LIABILITIES AND NET ASSETS

35

Year ended
March 31, 2014
(As of March 31, 2014)

14,996
173,137
50,000432
38,217
14,754
170,805
6,800
155
744
200
898
2,080
473,222

14,110173,614–368
41,353
15,347
189,772
7,366
178
–
100
1,555
2,902
446,670

100,000
839
1,101
6,177
7,081
70
115,270
588,492

100,000
758
1,103
6,153
7,563
68
115,647
562,317

114,464

114,464

144,898
144,898

144,898
144,898

23,30023,300

956

26

38

34

382,780
68,728475,803(94,169)
640,996382,780
61,584
467,725(94,265)
632,822

18,47333,3401
18,474659,471
1,247,963(0)33,339666,162
1,228,480

(2) Non-consolidated statements of income(Million yen)

Net sales
Cost of sales
Gross profit
Selling, general and administrative expenses
Operating income (loss)
Non-operating income
Interest income
Dividend income
Other
Total non-operating income
Non-operating expenses
Interest expense
Other
Total non-operating expenses
Ordinary income
Extraordinary gains
Gain on sale of fixed assets
Gain on sale of investment securities
Gain on exchange of stock
Other
Total extraordinary gains
Extraordinary losses
Loss on sale or disposal of fixed assets
Impairment loss
Loss on devaluation of investment securities
Loss on devaluation of securities in affiliates
Other
Total extraordinary losses
Income before income taxes
Current income taxes
Deferred income taxes
Total income taxes
Net income

36Year ended
March 31, 2013
926,142826,122
100,019
104,008(3,988)Year ended
March 31, 2014
919,016
811,894
107,121103,674
3,447

417
18,01445,82464,256289
16,24540,04656,5802,366
38,01740,383
19,884

1,939
31,60433,544
26,483

7,004
154
1,869
–
9,028

350
262
–
33
646

5,329
2,818
2,631
1,557
1,454
13,79015,121
670
(481)
188
14,933

3,864
–
314
5,227
184
9,590
17,539
160
4,832
4,992
12,547

(3) Non-consolidated statements of changes in net assets
The year ended March 31, 2013 (April 1, 2012 – March 31, 2013)(Million yen)
Stockholders’ equity
Capital surplus
Commonstock

Balance at the beginningof current period
Changes of items during
the period
Reversal of reserve for
special depreciation
Reversal of reserve fordepreciation reductionof fixed assets
Reversal of otherreserve
Cash dividends paid
Net income
Purchases of treasury
stock
Disposal of treasurystock
Net changes in items
other thanstockholders’ equity
Total changes of items
during the period
Balance at the end ofcurrent period

114,464

Capitalreserve

Total capitalsurplusLegalreserve

144,898

144,898

23,300Reserve for
specialdepreciation

Reserve fordepreciation
reduction of
fixed assets

Other
reserve

Retainedearnings
brought
forwardTotal
retainedearnings

6,335

44

432,780

19,047

481,506

5,379

–

5

–

50,000–(20,626)
14,933(20,626)
14,933(10)(10)(5,379)(5)(50,000)

–

–

–

–

(5,379)(5)(50,000)

49,681(5,703)

114,464

144,898

144,898

23,300956

38382,780

68,728475,803

Stockholders’ equity

Balance at the beginningof current period
Changes of items during
the period
Reversal of reserve for
special depreciation
Reversal of reserve fordepreciation reductionof fixed assets
Reversal of otherreserve
Cash dividends paid
Net income
Purchases of treasury
stock
Disposal of treasurystock
Net changes in items
other thanstockholders’ equity
Total changes of items
during the period
Balance at the end ofcurrent period

Retained earnings
Other retained earnings

Valuation and translation adjustments

Treasury
stock

Total
stockholders’equityValuationdifferenceonavailablefor-salesecuritiesNet
deferred
gains(losses)onhedgesTotalvaluationandtranslation
adjustments(94,148)646,721

4,061

(7)

4,053

Total net
assets

650,775

–

–

–

–

–

–

(20,626)
14,933(20,626)
14,933

(38)

(38)

(38)

16

6

6

–

14,412

8

14,42014,420(21)(5,725)

14,412

8

14,4208,695(94,169)

640,996

18,473

1

18,474659,471

37

The year ended March 31, 2014 (April 1, 2013 – March 31, 2014)(Million yen)
Stockholders’ equity
Capital surplus
Commonstock

Balance at the beginningof current period
Changes of items during
the period
Reversal of reserve for
special depreciation
Reversal of reserve fordepreciation reductionof fixed assets
Cash dividends paid
Net income
Purchases of treasury
stock
Disposal of treasurystock
Net changes in items
other thanstockholders’ equity
Total changes of items
during the period
Balance at the end ofcurrent period

114,464

Capitalreserve

Total capitalsurplusLegalreserve

144,898

144,898

23,300Total
retainedearnings

Reserve for
specialdepreciation

Reserve fordepreciation
reduction of
fixed assets

Other
reserve

Retainedearnings
brought
forward956

38382,780

68,728475,803

929

–

4

–

(20,624)
12,547(20,624)
12,547

(0)

(0)

(929)
(4)

–

–

–

–

(929)

(4)

–

(7,143)(8,077)

114,464

144,898

144,898

23,30026

34382,780

61,584

467,725

Stockholders’ equity

Balance at the beginningof current period
Changes of items during
the period
Reversal of reserve for
special depreciation
Reversal of reserve fordepreciation reductionof fixed assets
Cash dividends paid
Net income
Purchases of treasury
stock
Disposal of treasurystock
Net changes in items
other thanstockholders’ equity
Total changes of items
during the period
Balance at the end ofcurrent period

Retained earnings
Other retained earnings

Valuation and translation adjustments

Treasury
stock

Total
stockholders’equityValuationdifferenceonavailablefor-salesecuritiesNet
deferred
gains(losses)onhedgesTotalvaluationandtranslation
adjustments(94,169)

640,996

18,473

1

18,474

Total net
assets659,471

–

–

–

–

(20,624)
12,547(20,624)
12,547

(97)

(97)

(97)

1

0

0

–

14,866(1)

14,865

14,865(95)(8,173)

14,866(1)

14,865

6,691(94,265)

632,822

33,340(0)33,339666,16238

(4) Notes regarding non-consolidated financial statements[Notes on premise of a going concern]
None
6. Changes in directors and officers (as of June 27, 2014)
1) New director candidates (at the Ordinary General Meeting of Shareholders to be held on June
27)
Managing Director
Kouichi Hashimoto(currently President of DNP Nishi Nippon Co., Ltd)
Director (Outside)

Tsukasa Miyajima(currently Professor, Faculty of Law, Keio University)

2) Directors to be retired (at the end of the Ordinary General Meeting of Shareholders to be heldon June 27)
Senior Managing Director Osamu Tsuchida(to be assigned as Senior Adviser)
Senior Managing Director

Teruomi Yoshino(to be assigned as Senior Adviser)

Senior Managing Director

Yujiro Kuroda(to be assigned as Senior Adviser)

Managing Director

Takao Shimizu(to be assigned as Adviser)

3) Director to be promoted
Senior Managing Director

Tetsuji Morino(currently Managing Director)

4) New corporate officer candidates
Corporate Officer
Kazuhiko Takada(currently General Manager of SI Business Development
Promotion Division)
Corporate Officer

Ryota Chiba(currently General Manager of Communication & Information
Operations)

Corporate Officer

Nobuyuki Asaba(currently Deputy General Manager of Information Solutions
Operations)

Corporate Officer

Mitsuru Tsuchiya(currently General Manager of Fine Optronics Operations)5) Corporate officers to be retired
Senior Corporate Officer
Tatsuya Nishimura(to be assigned as Adviser)
Senior Corporate Officer
Tatsuo Komaki(to be assigned as Adviser)396) Corporate officers to be promoted
Senior Corporate Officer
Kenji Miya(currently Corporate Officer)
Senior Corporate Officer

Toshiki Sugimoto(currently Corporate Officer)

40