RYOBI LIMITEDSEMIANNUAL REPORT(Unaudited)
For the six months ended September 30, 2005

2005

A MESSAGE FROM THE MANAGEMENT
Guided by its corporate philosophy, “Create a sound and dynamic corporation through technology, trustand challenge,” the Ryobi Group seeks to establish itself as an indispensable existence by responding
to the needs of customers and society, through innovative, top-quality products and services.
At the same time, and based on its corporate philosophy, Ryobi has positioned corporate social
responsibility as fundamental to its management activities in an effort to create sustained corporate
value and to contribute to making a better society.
Furthermore, with growth and development at the forefront of Ryobi’s aims, the Company strives
to fulfill its corporate responsibility through progressive implementation of information disclosure,compliance with statutory regulations, risk management, environmental consciousness, activities that
contribute to society and other such initiatives, all the while working to establish and implement
corporate governance tailored to the Company ’s unique characteristics.
BUSINESS DEVELOPMENT
Looking toward the future, Ryobi realizes the vital rolesof improved competitiveness and enhanced earnings
power in accomplishing sustained growth and development. Accordingly, the Company continues to implement various measures in each of its operations tofurther boost market presence, while also providing
technology, products, and services that only Ryobi candeliver. As for the reduction of costs amid continued
conditions of material price inflation and product pricedeflation, Ryobi is working to bolster each of its businesses. 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,and Europe. Moreover, redoubling efforts to promote
our global die castings business strategy, in April 2005,
we founded a production base in Dalian, China. In keeping with the global theme of environmental protection
through the conservation of energy and resources, ouraluminum die castings are lightweight, have excellent
durability and are superior in terms of recyclability. In
addition to the automobile field, these die castings
have attracted attention in fields such as electronics
and telecommunications as an effective technology
for the protection of the environment, including theconservation of energy and resources.
1RYOBI LIMITED SEMIANNUAL REPORT 2005

2) PRINTING EQUIPMENT
The Company is striving to increase multicolor performance precision, offer increasingly advanced functionality and further consolidate its reputation in world
markets. To achieve these goals, Ryobi is pressing
forward with the development of new products andstrengthening of production and marketing capabilities. Through the development of products in response to advancements in IT and digitization, andthe creation of environmentally friendly products, weare working to expand our lineup in line with market
needs. Furthermore, in response to increasing demands for medium-size offset printing presses,Ryobi is escalating the production capacity of theHiroshima East Plant.
3) POWER TOOLS AND BUILDERS’ HARDWARE
In the power tools business, which includes lawn andgarden equipment, Ryobi focuses on the concept ofproducing compact and lightweight maneuverable
tools. Utilizing manufacturing collaboration between
Japan and Dalian, China, the Company delivers products in response to the needs of professionals andDIY enthusiasts alike. We continue to further strengthen competitiveness by focusing efforts on bolstering
product planning and marketing capabilities and improving productivity.
In our builders’ hardware business, we produce door
closers—a mainstay product—at our manufacturingsubsidiary in Dalian, China, and affiliate in Taiwan. We
aim to improve profitability by focusing on developingunique products, reducing costs through productivity
enhancements, and reinforcing competitiveness.
PERFORMANCEIn the six-month period ended September 30, 2005,
consolidated net sales increased 6.9% compared withthe same period of the previous fiscal year to ¥82,735
million, with domestic net sales rising 6.0% to ¥58,471
million and overseas net sales growing 9.1% to¥24,264 million.
Operating income for the period increased 32.2%
to ¥6,322 million, and net income expanded 44.6% to¥4,058 million.
Net sales increased across each of the Company’s
die castings, printing equipment, and power tools andbuilders’ hardware businesses, resulting in two consecutive six-month periods of increased revenue. Performance in the printing equipment business wasespecially healthy.
The increase in sales and Ryobi’s efforts to reduce
costs led to its fourth consecutive six-month period of
growth in operating income. At the same time, interim net income grew for the first time in the last twointerim periods.
By segment, net sales in the die castings business rose 3.7% to ¥54,044 million and operating income jumped 25.3% to ¥3,095 million, resulting in aratio of operating income to net sales of 5.7%, compared with 4.7% in the same period last year. Sales
to domestic automobile manufacturers solidified andincreased revenues. On the earnings front, Ryobi’s
undertakings to reduce costs and increase domestic
sales, even amidst the continuation of severe conditions that included downward pressure on productprices and rising material costs, successfully resulted in profit growth. We will continue to pursue activities geared toward non-automobile applications aswell as expand the automobile segment, while simultaneously giving more attention to enhancing productivity and reducing costs.
Net sales in the printing equipment businessclimbed 23.8% to ¥15,726 million, as did operating
income by 71.7% to ¥1,935 million, resulting in a ratioof operating income to net sales of 12.3%, comparedwith 8.9% from the previous corresponding period.
Sales of medium-size offset printing presses grew,resulting in an increase in revenues. Contributing toan increase in 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 userneeds, enhance marketing efforts and expand production capacity in response to increased demands for
medium-size offset printing presses.
In the power tools and builders’ hardware business,
net sales rose 3.1% to ¥12,965 million while operating income increased 9.1% to ¥1,292 million, resulting in a ratio of operating income to net sales of 10.0%,compared with 9.4% in the same period last year.
Despite conditions of intensifying competition, owing
to the rise in domestic sales of power tools and builders’ hardware, overall sales in this segment increased.
In addition to this expansion of sales, Ryobi’s endeavors to bolster the efficiency of its manufacturing operations gave way to a growth in earnings. In the future,
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
and enhancing measures designed to create a soundand dynamic corporation. We thank you for your continued support and understanding.

December 2005

Hiroshi Urakami
Chairman and CEOSusumu Yoshikawa
President and COO
RYOBI LIMITED SEMIANNUAL REPORT 2005

2CONSOLIDATED BALANCE SHEETS
Ryobi Limited and Consolidated Subsidiaries(As of September 30 and March 31, 2005) (Unaudited)Thousands ofU.S. dollars*Millions of yen

September 30
2005

March 312005

September 30
2005

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

¥ 14,240
2,872
39,71729,2891,045
87,163¥ 15,303
2,736
39,82327,5282,357
87,747$ 125,806
25,373350,888258,760
9,232
770,059

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

55,896

54,837493,824

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

11,9109,428

105,221

333
1,724
953
2,287
17,207¥160,266

340
1,638
1,120
2,310
14,836¥157,420

2,942
15,231
8,420
20,205
152,019$1,415,902

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

¥ 19,834
8,082
37,720
4,208
759
3,963
74,566¥ 19,806
11,03336,146
4,372
490
4,533
76,380$ 175,227
71,402333,245
37,176
6,706
35,012658,768

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

12,6096,954
5,301
24,864

13,663
6,879
4,280
24,822

111,397
61,437
46,832
219,666

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

870

924

7,686

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

18,472
23,681
21,307626
4,478(7,835)(763)
59,966¥160,266

18,472
23,58818,503626
3,029(8,094)(830)
55,294¥157,420

163,195
209,215
188,241
5,530
39,562(69,220)(6,741)
529,782$1,415,902*U.S. dollar amounts in this report, solely for the convenience of the reader, are translated from yen at the rate of ¥113.19 = US$1, the exchange rate
prevailing on September 30, 2005.

3

RYOBI LIMITED SEMIANNUAL REPORT 2005

CONSOLIDATED STATEMENTS OF OPERATIONS
Ryobi Limited and Consolidated Subsidiaries(Six months ended September 30, 2005 and 2004) (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 ................................................................
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
2005

September 30
2004

September 30
2005¥82,735
65,084
17,651
11,3296,322¥77,423
61,59815,825
11,044
4,781$730,939
574,998
155,941
100,088
55,853

101
765
866

98
969
1,067

892
6,759
7,651

335
477
812
6,376
2,160
158
¥ 4,058

378
703
1,081
4,767
1,901
59
¥ 2,807

2,960
4,214
7,174
56,33019,083
1,396$ 35,851

CONSOLIDATED STATEMENTS OF CASH FLOWS
Ryobi Limited and Consolidated Subsidiaries(Six months ended September 30, 2005 and 2004) (Unaudited)Thousands of
U.S. dollars*Millions of yen

September 30
2005

September 30
2004

September 30
2005

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

¥ 7,971¥ 7,046$ 70,421

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

(3,437)(171)(3,608)(2,902)315(2,587)(30,365)(1,511)(31,876)

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

3,450(7,456)(194)(1,260)18(5,442)

1,300(5,281)(2,192)(1,255)(71)(7,499)30,480(65,871)(1,714)(11,132)
159(48,078)

Foreign currency translation adjustments on cash and cash
equivalents ..................................................................................
Net decrease in cash and cash equivalents ................................
Cash and cash equivalents at beginning of year ........................
Cash and cash equivalents at end of year ..................................

16(1,063)
15,303¥14,240

18(3,022)
17,595¥14,573142(9,391)
135,197$125,806

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

¥¥

$341

388

3,013

RYOBI LIMITED SEMIANNUAL REPORT 2005

4

INDUSTRY SEGMENT INFORMATION(Six months ended September 30, 2005 and 2004)

5

Die castings

Printingequipment

Millions of yen2005
Power tools andbuilders’ hardware

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

¥54,044110¥15,726—¥12,9651

Eliminations

Consolidated

¥

—
(111)

¥82,735—
82,735

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

54,154

15,726

12,966(111)

Operating costs and expenses ..

51,05913,791

11,674(111)

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

¥ 3,095¥ 1,935¥ 1,2920¥ 6,322Die castings

Printing
equipment

Millions of yen
2004Power tools andbuilders’ hardware

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

¥52,141
119¥12,706—¥12,5761

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

52,26012,706

12,577

Operating costs and expenses ..

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

¥ 2,470¥ 1,127¥ 1,184

Die castings

Printing
equipment

Thousands of U.S. dollars*
2005
Power tools andbuilders’ hardware

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

$477,462
972$138,935—$114,542
9¥

Eliminations

Consolidated

¥

—
(120)

¥77,423—(120)

77,423¥(120)

72,6420¥ 4,781

Eliminations

Consolidated

$—
(981)

$730,939—

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

478,434

138,935

114,551(981)

730,939

Operating costs and expenses ..

451,091121,840

103,136(981)

675,086

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

$ 27,343$ 17,095$ 11,4150$ 55,853

RYOBI LIMITED SEMIANNUAL REPORT 2005$

GEOGRAPHICAL SEGMENT INFORMATION(Six months ended September 30, 2005 and 2004)

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

Japan

North America

Millions of yen
2005
Other

¥70,349
957¥8,575
3¥3,811
2,597

Eliminations

Consolidated¥—(3,557)¥82,735—

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

71,306

8,578

6,408

(3,557)

82,735

Operating costs and expenses ..

66,426

7,942

5,617

(3,572)

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

¥ 4,880

¥ 636

¥ 791

¥

15

¥ 6,322

Eliminations

Consolidated¥¥77,423—

JapanNorth America

Millions of yen
2004
OtherNet sales:
Unaffiliated customers .........
Intersegment ........................

¥64,013968¥ 9,836—¥3,574
2,345—(3,313)

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

64,981

9,836

5,919

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

61,721

9,086

5,131

(3,296)

72,642

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

¥ 3,260750

¥ 788

(17)

¥ 4,781

Eliminations

Consolidated$—(31,425)$730,939—¥

Japan

North America

Thousands of U.S. dollars*
2005
OtherNet sales:
Unaffiliated customers .........
Intersegment ........................

$621,512
8,455$75,758
26$33,669
22,944¥

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

629,967

75,78456,613(31,425)

730,939

Operating costs and expenses ..

586,854

70,16549,625(31,558)

675,086

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

$ 43,113$ 5,619$ 6,988133$ 55,853$

EXPORT SALES AND SALES BY OVERSEAS SUBSIDIARIES(Six months ended September 30, 2005 and 2004)

2005

2004

Thousands ofU.S. dollars*
2005

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

¥11,586
8,616
4,062

¥11,246
7,843
3,156

$102,359
76,12035,886

14.0%
10.4%
4.9%

14.5%
10.1%
4.1%

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

¥24,264¥22,245$214,365

29.3%

28.7%

Millions of yen

Percentage against
consolidated net sales
2005
2004

RYOBI LIMITED SEMIANNUAL REPORT 2005

6

CORPORATE INFORMATIONCORPORATE DATAHead Office762, Mesaki-cho, Fuchu, Hiroshima 726-8628, Japan
Telephone: 81-847-41-1111Company 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
Telephone: 81-3-3927-5541
Toranomon Office
Toranomon Central Building
1-7-1, Nishi-Shinbashi, Minato-ku, Tokyo 105-0003, Japan
Telephone: 81-3-3927-5541

MANAGEMENT MEMBERS
BOARD OF DIRECTORSCORPORATE OFFICERS

Chairman and Representative Director
Hiroshi Urakami

Chief Executive Officer

Hiroshi Urakami

Chief Operating Officer

Susumu Yoshikawa

Executive Corporate Officers

Takao Tanaka
Takashi Yokoyama
Mikio Kamura
Shiro Muroya

Corporate Officers

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

President and Representative Director
Susumu Yoshikawa
Directors

Takao Tanaka
Takashi Yokoyama
Mikio Kamura
Shiro Muroya
Koji Ishii
Akira Urakami
Kenjiro Suzuki

CORPORATE AUDITORSStanding Corporate AuditorShozo Kobayashi

Corporate Auditors

Satoshi Ohoka
Hiroaki Takahashi
Kunihiro Toyota

SHAREHOLDER INFORMATION
Number of Shares Issued(As of September 30, 2005)

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

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

PRINTED IN JAPAN©RYOBI LIMITED 2005