SEMIANNUAL REPORT(Unaudited)
For the six months ended September 30, 2006

2006

A MESSAGE FROM THE MANAGEMENT
Guided by its corporate philosophy, “Create a sound and dynamic corporation through technology, trust andchallenge,” the Ryobi Group seeks to establish itself as an indispensable existence by responding to theneeds of customers and society, through innovative, top-quality products and services. While developing its
Die Castings Business in tandem with its finished products, Ryobi continues to make every effort to reinforce
market competitiveness and improve earnings power.
With regard to corporate social responsibility (CSR), the Ryobi Group considers the implementation of its
corporate philosophy as CSR promotion itself. With this in mind, Ryobi will strive to enhance its corporate
governance by conducting timely disclosure of information, compliance with statutory regulations, risk
management, internal control and other related activities.

BUSINESS DEVELOPMENT
With the aim of sustained growth and development for
the future, the Ryobi Group continues to implement various measures in each of its operations to further boost
market presence, while also providing technology, products, and services that only Ryobi can deliver. Ryobi isworking to bolster each of its businesses by reducing
costs amid continued conditions of rising material prices and declining product prices. Trends in business development for each segment are as follows:
1) DIE CASTINGS
Ryobi aims to strengthen and expand relationships with
automobile manufacturers by utilizing our know-how as
a world-leading die casting manufacturer with a production structure operating in Japan, the United States, andEurope. Ryobi has established a production base in
Dalian, China, in pursuit of redoubling efforts to promote
our global die castings business strategy. Our aluminum
die castings are lightweight, have excellent durability andare superior in terms of recyclability. In addition to theautomobile field, these die castings have increasingly
attracted attention in fields such as electronics and telecommunications as an effective technology for the protection of the environment, including the conservationof energy and resources.
2) PRINTING EQUIPMENT
The Company is striving to increase multicolor performance precision, offer increasingly advanced functionality, and further consolidate its reputation in world
1

RYOBI SEMIANNUAL REPORT 2006

markets. To achieve these goals, Ryobi is pressing forward with the development of new products and thestrengthening of production and marketing capabilities.
Through the development of products in response toadvancements in IT and digitization, and the creationof environmentally friendly products, we are working
to expand our lineup in line with market needs. At ourHiroshima East Plant, a second plant was establishedin response to increased demand for medium-size offset printing presses, with full-scale operations commencing in October 2006. We plan to begin constructionof a third plant in January 2007 as we strive to reinforce
our production capacity.
3) POWER TOOLS AND BUILDERS’ HARDWARE
In the power tools business, which includes lawn andgarden equipment, Ryobi focuses on the concept of producing compact and lightweight tools. Utilizing manufacturing collaboration between Japan and Dalian, China,
the Company delivers products in response to the needsof professionals and DIY enthusiasts alike. We continue
to further strengthen competitiveness by focusing efforts on bolstering product planning and marketing capabilities and improving productivity.
In our builders’ hardware business, we aim to improve profitability by focusing on developing unique products, reducing costs through productivity enhancements,
and reinforcing price competitiveness. Our mainstay door
closers are manufactured primarily at our manufacturing subsidiary in Dalian, China, and affiliate in Taiwan.

PERFORMANCEIn the six-month period ended September 30, 2006, consolidated net sales increased 18.4% compared with thesame period of the previous fiscal year to ¥97,974 million, with domestic net sales rising 15.8% to ¥67,719
million and overseas net sales growing 24.7% to ¥30,255
million.
Operating income for the period increased 28.6% to¥8,129 million, and net income expanded 34.6% to¥5,461 million.
Net sales increased across each of the Company’s
Die Castings, Printing Equipment, and Power Tools andBuilders’ Hardware Businesses, resulting in three consecutive six-month periods of increased revenue. Performance in the Die Castings and Printing Equipment
Businesses were especially healthy.
The increase in sales and Ryobi’s efforts to reduce
costs led to a fifth consecutive six-month period of growthin operating income. Interim net income grew in two consecutive six-month periods. Furthermore, Ryobi recorded a historical high for operating income.
By segment, net sales in the Die Castings Businessrose 22.4% to ¥66,161 million and operating income
surged 41.7% to ¥4,385 million, resulting in a ratio of
operating income to net sales of 6.6% compared with
5.7% in the same period last year. Sales to domestic
and American automobile manufacturers solidified andincreased revenues. On the earnings front, Ryobi’s undertakings to reduce costs and increase sales successfully resulted in profit growth, even amidst thecontinuation of severe conditions that included downward pressure on product prices and rising material costs.
Since die castings are an effective technology that realizes environmental protection and the conservation of
resources and energy, which are important global concerns, continuous growth in die castings is expected.
We will continue to pursue activities geared toward the
non-automobile segment as well as expanding automobile applications, while simultaneously giving more attention to enhancing productivity and reducing costs.
Net sales in the Printing Equipment Business climbed
18.4% to ¥18,618 million, as did operating income by
38.6% to ¥2,682 million, resulting in a ratio of operating

income to net sales of 14.4%, compared with 12.3%
from the previous corresponding period. Exports to Europe, the Americas and Asian countries were strong, andsales of medium-size offset printing presses grew significantly, resulting in an increase in revenues. Contributing to higher earnings were increased net sales andefforts to step up reductions in costs. With the aim ofincreasing earnings still further, Ryobi will continue toactively develop products that fully consider user needs,
enhance marketing efforts and expand production capacity in response to increased demands for mediumsize offset printing presses.
In the Power Tools and Builders’ Hardware Business,
net sales rose 1.8% to ¥13,195 million while operating
income decreased 17.8% to ¥1,062 million, resulting ina ratio of operating income to net sales of 8.0%, compared with 10.0% in the same period last year. Amid intensifying competition, domestic sales of power tools
as well as domestic sales and exports of builders’ hardware grew slightly. On the earnings front, however, profit declined. We will continue to leverage our overseas
production capabilities with the aim of reducing costs
and to deliver unique and price competitive products.
Ryobi is committed to consistently strengthening andenhancing measures designed to create a sound anddynamic corporation. We thank you for your continued
support and understanding.

December 2006

Hiroshi Urakami
Chairman and CEO

Susumu Yoshikawa
President and COO
RYOBI SEMIANNUAL REPORT 2006

2

CONSOLIDATED BALANCE SHEETS
Ryobi Limited and Consolidated Subsidiaries(As of September 30 and March 31, 2006) (Unaudited)Thousands of
U.S. dollars*Millions of yen

ASSETS
Current assets
Cash and cash equivalents .........................................................
Time deposits .............................................................................
Notes and accounts receivable, less allowances ........................
Inventories ..................................................................................
Prepaid expenses and other .......................................................
Total current assets ..........................................................
Net property, plant and equipment .............................................
Investments and other assets
Investments in securities ............................................................
Investments in and advances to unconsolidated subsidiaries
and affiliates ..............................................................................
Intangible fixed assets ................................................................
Deferred tax assets .....................................................................
Other ..........................................................................................
Total investments and other assets ..................................
Total ................................................................................
LIABILITIES AND EQUITYCurrent liabilities
Short-term borrowings ................................................................
Current portion of long-term debt ...............................................
Notes and accounts payable ......................................................
Accrued expenses ......................................................................
Income taxes payable .................................................................
Other current liabilities ................................................................
Total current liabilities .......................................................
Long-term liabilities
Long-term debt ...........................................................................
Accrued severance indemnities ..................................................
Other long-term liabilities ............................................................
Total long-term liabilities ...................................................
Minority interests .........................................................................
EquityCommon stock
Authorized: 500,000,000 shares
Issued: 171,230,715 shares ....................................................
Capital surplus ............................................................................
Retained earnings .......................................................................
Unrealized gain on available-for-sale securities ...........................
Deferred loss on derivatives under hedge accounting ...............
Land revaluation reserve .............................................................
Foreign currency translation adjustments ...................................
Treasury stock .............................................................................
Total .................................................................................
Minority interests ........................................................................
Total equity .......................................................................
Total ................................................................................

September 30
2006

March 312006

September 30
2006¥ 17,891
1,248
50,81835,474
1,682
107,11366,953¥ 16,097
2,402
44,89931,9191,575
96,89260,306$ 151,747
10,585431,026
300,882
14,267
908,507567,880

12,891

14,856109,338

353
1,887
1,367
2,209
18,707¥192,773

408
1,828
1,312
2,263
20,667¥177,865

2,994
16,005
11,59518,736
158,668$1,635,055¥ 18,699
3,615
61,194
4,488
2,877
3,322
94,195¥ 19,841
6,584
44,698
4,589
3,374
4,503
83,589$ 158,601
30,662
519,033
38,066
24,402
28,176
798,940

15,747
6,663
5,775
28,185—

13,3986,906
6,275
26,579941

133,562
56,514
48,982
239,058—

18,472
23,681
29,628
5,148
(0)
626
(7,336)(771)
69,448945
70,393¥192,773

18,472
23,681
25,885
6,229—
626(7,370)(767)
66,756—66,756¥177,865

156,675
200,857
251,298
43,664(0)
5,310(62,223)(6,539)589,0428,015
597,057$1,635,055*U.S. dollar amounts in this report, solely for the convenience of the reader, are translated from yen at the rate of ¥117.90 = US$1, the exchange rate
prevailing on September 30, 2006.

3

RYOBI SEMIANNUAL REPORT 2006

CONSOLIDATED STATEMENTS OF INCOME
Ryobi Limited and Consolidated Subsidiaries(Six months ended September 30, 2006 and 2005) (Unaudited)Thousands of
U.S. dollars*Millions of yen

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

September 30
2006

September 30
2005

September 30
2006¥97,974
78,116
19,858
11,7298,129¥82,735
65,084
17,651
11,3296,322$830,992
662,561
168,431
99,483
68,948

110
771
916
1,797

101
—
765
866

933
6,539
7,770
15,242

380
1,192
1,572
8,354
2,876
17
¥ 5,461

335
477
812
6,376
2,160
158
¥ 4,058

3,223
10,11013,33370,857
24,394144$ 46,319

CONSOLIDATED STATEMENTS OF CASH FLOWS
Ryobi Limited and Consolidated Subsidiaries(Six months ended September 30, 2006 and 2005) (Unaudited)Thousands of
U.S. dollars*Millions of yen

September 30
2006

September 30
2005

September 30
2006

Net cash provided by operating activities ..................................

¥ 9,134¥ 7,971$ 77,472

Investing activities
Purchase of property, plant and equipment ................................
Other ..........................................................................................
Net cash used in investing activities ............................

(5,995)
1,972(4,023)(3,437)(171)(3,608)(50,848)
16,717(34,131)

Financing activities
Proceeds from long-term debt ....................................................
Repayments of long-term debt ...................................................
Decrease in short-term borrowings, net .....................................
Cash dividends paid ....................................................................
Other ..........................................................................................
Net cash used in financing activities ............................

4,056(4,654)(1,053)(1,681)(4)(3,336)3,450(7,456)(194)(1,260)18(5,442)

34,402(39,474)(8,931)(14,258)(34)(28,295)

Foreign currency translation adjustments on cash and cash
equivalents ..................................................................................
Net increase (decrease) in cash and cash equivalents ...............
Cash and cash equivalents at beginning of year ........................
Cash and cash equivalents at end of the period ........................

19
1,794
16,097¥17,891

16(1,063)
15,303¥14,240

162
15,208
136,539$151,747

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

¥

¥

$

373

341

3,164

RYOBI SEMIANNUAL REPORT 2006

4

INDUSTRY SEGMENT INFORMATION(Six months ended September 30, 2006 and 2005)

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

5

Die castings

Printing
equipment

Millions of yen
2006Power tools andbuilders’ hardware¥66,161
113¥18,618—¥13,195
1

Eliminations

Consolidated¥¥97,974——(114)

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

66,274

18,61813,196(114)

97,974

Operating costs and expenses ..

61,88915,936

12,134(114)

89,845

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

¥ 4,385¥ 2,682¥ 1,0620¥ 8,129

Die castings

Printing
equipment

Millions of yen
2005Power tools andbuilders’ hardware

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

¥54,044110¥15,726—¥12,965
1

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

54,154

15,726

12,966

Operating costs and expenses ..

51,05913,791

11,674

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

¥ 3,095¥ 1,935¥ 1,292

Die castings

Printing
equipment

Thousands of U.S. dollars*
2006
Power tools andbuilders’ hardware

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

$561,162
958$157,913—$111,917
8¥

Eliminations

Consolidated

¥

—
(111)

¥82,735—(111)

82,735¥(111)

76,4130¥ 6,322

Eliminations

Consolidated

$

—
(966)

$830,992—

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

562,120

157,913111,925(966)

830,992

Operating costs and expenses ..

524,928

135,165

102,917(966)

762,044

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

$ 37,192$ 22,7480$ 68,948

RYOBI SEMIANNUAL REPORT 2006

$

9,008

$

GEOGRAPHICAL SEGMENT INFORMATION(Six months ended September 30, 2006 and 2005)

Japan

North America

Millions of yen
2006
Other

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

¥ 82,498
1,279¥ 11,432
284¥ 4,0442,993

Eliminations

Consolidated¥—(4,556)¥ 97,974—
97,974

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

83,777

11,716

7,037(4,556)

Operating costs and expenses ..

77,282

10,6796,504(4,620)89,845

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

¥ 6,495¥ 1,037¥64¥ 8,129

Japan

North America

Millions of yen
2005
Other

Eliminations

Consolidated¥ 70,349
957¥ 8,5753¥ 3,8112,597¥—(3,557)¥ 82,735—
82,735Net sales:
Unaffiliated customers .........
Intersegment ........................

533¥

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

71,306

8,578

6,408

(3,557)

Operating costs and expenses ..

66,426

7,942

5,617

(3,572)

76,413Operating income ....................

¥ 4,88015¥ 6,322

Eliminations

Consolidated

¥

636

¥

791

¥

Japan

North America

Thousands of U.S. dollars*
2006
Other

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

$ 699,729
10,848$ 96,963
2,409$ 34,300
25,386$—(38,643)$ 830,992—

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

710,577

99,372

59,686(38,643)

830,992

Operating costs and expenses ..

655,488

90,57755,165(39,186)

762,044

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

$ 55,089$ 8,795$ 4,521$$ 68,948

543

EXPORT SALES AND SALES BY OVERSEAS SUBSIDIARIES(Six months ended September 30, 2006 and 2005)

2006

2005

Thousands of
U.S. dollars*
2006

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

¥ 14,078
10,285
5,892¥ 11,586
8,616
4,062

$ 119,406
87,23549,975

14.4%
10.5%
6.0%

14.0%
10.4%
4.9%

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

¥ 30,255¥ 24,264$ 256,616

30.9%

29.3%

Millions of yen

Percentage against
consolidated net sales
2006
2005

RYOBI SEMIANNUAL REPORT 2006

6

CORPORATE INFORMATIONCORPORATE DATAHead Office
762 Mesaki-cho, Fuchu-shi, Hiroshima-ken 726-8628, Japan
Tel. 81-847-41-1111

Company NameRYOBI LIMITED
Established
December 16, 1943
Major Products
Die cast products
Printing equipment(offset printing presses, page layout software, etc.)
Power tools(electric power tools, lawn and garden equipment, etc.)
Builders’ hardware(door closers, hinges, architectural hardware, etc.)

Tokyo Branch
5-2-8 Toshima, Kita-ku, Tokyo 114-8518, Japan
Tel. 81-3-3927-5541
Toranomon Office
Toranomon Central Building
1-7-1 Nishishinbashi, Minato-ku, Tokyo 105-0003, Japan
Tel. 81-3-3927-5541

MANAGEMENT MEMBERS (As of January 1, 2007)
BOARD OF DIRECTORSCORPORATE OFFICERS

Chairman and Representative Director
Hiroshi Urakami
President and Representative Director
Susumu Yoshikawa
Directors
Takao Tanaka
Takashi Yokoyama
Mikio Kamura
Shiro Muroya
Koji Ishii
Akira Urakami
Kenjiro Suzuki
Outside Director
Satoshi Ohoka

Chief Executive Officer
Chief Operating Officer
Executive Corporate Officers

Corporate Officers

CORPORATE AUDITORSStanding Corporate Auditor
Corporate Auditor
Outside Corporate Auditors

Shozo Kobayashi
Hiroaki Takahashi
Kunihiro Toyota
Tairo Katoh

Hiroshi Urakami
Susumu Yoshikawa
Takao Tanaka
Takashi Yokoyama
Mikio Kamura
Shiro Muroya
Koji Ishii
Kenjiro Suzuki
Kuniyuki Ito
Naomichi Honkawa
Kazuaki Danjo
Shoji Osawa
Hideki Domoto

SHAREHOLDER INFORMATION
Number of Shares Issued(As of September 30, 2006)

171,230,715
Listing
Common Stock—Tokyo

Transfer Agent
Mitsubishi UFJ Trust and Banking Corporation
4-5, Marunouchi, 1-chome Chiyoda-ku,
Tokyo 100-8212, Japan
This semiannual report was printed by a Ryobi printingpress using 100% recycled paper and soybean ink.

Head Office 762 Mesaki-cho, Fuchu-shi, Hiroshima-ken 726-8628, Japan
Tel. 81-847-41-1111
http://www.ryobi-group.co.jp/

Printed in Japan
Copyright©2007 Ryobi Limited.
All Rights Reserved.