October 29, 2013

First Half Consolidated Earnings Report for Fiscal 2013, Ending March 31, 2014
[Japanese Standards] (Consolidated)
Company name:Securities code:
Representative:
Inquiries:

Ryosan Company, Limited
Stock listing: First Section, Tokyo Stock Exchange
8140(URL http://www.ryosan.co.jp)
Naoto Mimatsu, Representative Director and President
Hidekazu Sano
Director and General Manager
Financing and Accounting Headquarters
TEL: +81-3-3862-2591
Scheduled filing date of quarterly earnings report
November 14, 2013
Scheduled payment date of dividend:
December 3, 2013
Supplementary materials for the quarterly financial results:
Yes
Investor conference for the quarterly financial resultsYes (for security analysts and institutional investors)(Millions of yen rounded down)

1. Consolidated results for the first half of fiscal 2013 (April 1, 2013 to September 30, 2013)(1) Consolidated operating results (Cumulative)(% figures represent year-on-year increase or decrease)
Net sales

Operating income

Millions of yen

First Half, Fiscal 2013
First Half, Fiscal 2012%

Millions of yen

111,092

4.6

106,185(0.8)

Ordinary income

Net income%

Millions of yen%

Millions of yen

%

2,208

4.2

2,152

(15.2)

1,340(13.7)

2,119

34.6

2,538

21.0

1,552

37.1

(Note) Comprehensive income
First Half, Fiscal 2013: 2,341 million yen (199.5%) First Half, Fiscal 2012: 781 million yen ( - %)Net income
Net income perper shareshare after dilution
First Half, Fiscal 2013
First Half, Fiscal 2012

Yen

Yen

42.16
46.40

－
－

(2) Consolidated financial position
Total assets

Net assets tototal assets

Net assets

Millions of yen

September 30, 2013
164,356
March 31, 2013
160,220(Reference) Shareholders equity: September 30, 2013:

Millions of yen

Net assets
per share%

116,829
116,722
116,829 million yen, March 31, 2013:

Yen

71.1
72.9
116,722 million yen

3,713.10
3,595.42

2. Dividends
Dividends per share (Yen)(Record date)

End of 1Q

Fiscal 2012
Fiscal 2013
Fiscal 2013 (Forecast)(Note) Revision of dividend forecasts: No

End of 2Q－－

End of 3Q

30.00
30.00

End of 4Q

Annual

－

30.00

60.00

－

30.00

60.00

3. Forecast of results for the fiscal year ending March 31, 2014 (April 1, 2013 to March 31, 2014)
Net sales
Millions of yen

Operating income%

Millions of yen

Full Fiscal Year
225,000
8.9
5,000(Note) Revision of financial results forecasts: Yes(% figures represent year-on-year increase or decrease)
Net income per
Ordinary income
Net income
share

%

Millions of yen%

Millions of yen

%

36.1

5,000

21.6

3,100

10.1

Yen

98.00

※Notes(1) Transfer of major subsidiaries during the scope of consolidation of this quarter (transfer of specified subsidiaries in line withchanges in the consolidated range): No(2) Applying accounting procedures specific to preparing quarterly financial statements: No(3) Changes in accounting principles, changes in accounting estimates and restatements
1. Changes in accordance with revisions to accounting standards and related practices of accounting principles: No
2. Changes in items of accounting principles other than 1. above: No
3. Changes in accounting estimate: No
4. Restatement of revisions: No(4) Number of shares issued and outstanding (Common stock)
1. Total number of shares issued and outstanding (including treasury stock) as of the period-end:
September 30, 2013: 31,500,000 shares

March 31, 2013: 34,500,000 shares

2. Total number of treasury stock as of the period-end:
September 30, 2013: 35,878 shares

March 31, 2013: 2,035,794 shares

3. Average number of shares outstanding during the period (Cumulative total for the quarterly consolidated period)First half, fiscal 2013: 31,802,990 sharesFirst half, fiscal 2012: 33,464,508 shares

Indication regarding the implementation status of the quarterly review procedure
This quarterly consolidated earnings report is not subject to the quarterly review procedures pursuant to the Financial Instruments andExchange Act. As of the disclosure of this earnings report, the procedures for reviewing quarterly financial statements pursuant to the
Financial Instruments and Exchange Act are in progress.
Caution with respect to forward-looking statements:
1. The estimates referred in this report were made based on the information available as of the date of this release. The Company does notpromise the realization of the estimates in this report. The Actual results could significantly differ from the estimates due to a variety offactors. For details on the conditions that form the assumptions used for earnings forecasts and notes on using earnings forecasts, pleaserefer to appendix page 3, “1. Qualitative Information Regarding this Quarterly Statement (3) Qualitative Information Concerning
Consolidated Forecast and Other Future Predictions.”
2. We will host Security Analyst and Institutional Investor Conference on Friday, November 15, 2013.
Presentation materials for results briefing for the conference will be posted on the company's homepage promptly after the conference.

○Table of contents of the appendix
1. Qualitative Information Regarding this Quarterly Statement ........................................................................................................... 2(1) Qualitative Information Concerning Consolidated Operating Results .................................................................................. 2(2) Qualitative Information Concerning Consolidated Financial Position .................................................................................. 3(3) Qualitative Information Concerning Consolidated Forecast and Other Future Predictions .................................................. 3
2. Items Regarding Summary Information (Notes) .............................................................................................................................. 4(1) Transfer of Major Subsidiaries during the Scope of Consolidation of this Quarter ............................................................... 4(2) Applying Accounting Procedures Specific to Preparing Quarterly Financial Statements...................................................... 4(3) Changes in Accounting Principles, Changes in Accounting Estimates and Restatements ..................................................... 4
3. Consolidated Quarterly Financial Statements .................................................................................................................................. 5(1) Consolidated Quarterly Balance Sheets ................................................................................................................................ 5(2) Consolidated Quarterly Statements of Income and Consolidated Quarterly Comprehensive Statements of Income ............ 7
Consolidated Quarterly Statements of Income
Scope of Consolidation of this First Half Period ........................................................................................................... 7
Consolidated Quarterly Comprehensive Statements of Income
Scope of Consolidation of this First Half Period ........................................................................................................... 8(3) Consolidated Quarterly Statements of Cash Flows ............................................................................................................... 9(4) Notes Regarding Consolidated Quarterly Financial Statements ............................................................................................ 10(Notes Regarding Going Concern) ........................................................................................................................................ 10(Notes Regarding Substantial Changes in Shareholders’ Equity) ......................................................................................... 10(Segment Information) .......................................................................................................................................................... 10
4. Supplementary Information ............................................................................................................................................................. 11-1-

1. Qualitative Information Regarding this Quarterly Statement(1) Qualitative Information Concerning Consolidated Operating Results1) Overview
In this consolidated first half period (April 1, 2013 – September 30, 2013), economic growth of the emerging
countries including China slowed down, while there were some signs in European economy to show that it had hit
the bottom and U.S economy hovered at a steady level. Economy of Japan showed a gradual recovery that was
firmly supported by the economy-boosting measures of the Japanese government.
Within this economic environment, the electronics industry continues to follow a recovery trend, including healthy
growth in smartphones and car electronics.
Under such circumstances, Ryosan Group has worked on “cultivating businesses to serve as 2nd and 3rd pillars,”“enhancing actions as a technology training company,” “enhancing actions in each business segment” and “further
reform of corporate structure” while setting “the pursuit of sustainable growth and sound management” as our basic
stance of management for fiscal year 2013.
In this consolidated first half period, net sales increased to 111,092 million yen (up 4.6% from the same periodprevious year) and operating income increased to 2,208 million yen (up 4.2%), but ordinary income decreased to
2,152 million yen (down 15.2%) and net income decreased to 1,340 million yen (down 13.7%).
2) Business Segment Informationa. Semiconductors
We sell memories, system LSIs and discrete semiconductors, and develop system LSIs. In this consolidated firsthalf period, sales of system LSIs for in-vehicle electrical components and memories for smartphones, etc.
increased, with net sales of 74,332 million yen (up 10.8% from the same period previous year) and operating
income of 1,364 million yen (up 16.7%).
b. Electronic Components
We sell display devices, power supplies and electromechanical components. In this consolidated first half period,
sales of display devices for digital cameras, etc. decreased, with net sales of 25,895 million yen (down 3.7% fromthe same period previous year) and operating income of 654 million yen (down 0.9%).
c. Electronic Equipment
We sell systems equipment and facilities equipment. In this consolidated first half period, sales of systemequipment for in-vehicle electrical components, etc. decreased, with net sales of 8,285 million yen (down 13.9%
from the same period previous year) and operating income of 307 million yen (down 8.1%).
d. Ryosan Products
We produce and sell heat sinks (devices that dissipate the heat generated by semiconductors). In this consolidated
first half period, sales of heat sinks for white goods, etc. increased, with net sales of 2,579 million (up 0.2% fromthe same period previous year), but an operating loss of 2 million yen was posted.

-2-(2) 1) Qualitative Information Concerning Consolidated Financial Position
At the end of this first half period, total assets had increased by 4,136 million yen, as compared with the level at theend of the previous fiscal year, and came to 164,356 million yen.
Also, net assets increased by 106 million yen, as compared with the level at the end of the previous fiscal year, andcame to 116,829 million yen, with the ratio of net assets to total assets being 71.1%.
2) An Overview of Cash Flows
As of the end of this consolidated first half period, cash and cash equivalent had decreased by 1,011 million yen ascompared with the level at the end of the previous consolidated fiscal year, and came to 49,451 million yen.
(An overview of cash flow from operating activities)
Regarding cash flow from operating activities in this consolidated first half period, on the whole there was anincrease of funds by 1,391 million yen, thanks to income before income taxes and minority interests of 2,155
million yen and an increase of 2,949 million yen in trade notes and accounts payable, in spite of increases of 882
million yen in trade notes and accounts receivable and of 2,426 million yen in inventories. For a comparison, inthe net cash provided by (used in) operating activities of the corresponding quarter of the previous year, there wasan increase of funds by 6,260 million yen.
(An overview of cash flow from investing activities)
Regarding cash flow from investing activities in this consolidated first half period, there was a decrease of funds
by 203 million yen due mainly to purchase of fixed assets. For a comparison, in the net cash provided by (used in)investing activities of the corresponding quarter of the previous year, there was an increase of funds by 1,491
million yen.
(An overview of cash flow from financing activities)
Regarding cash flow from financing activities in this consolidated first half period, there was a decrease of funds
by 2,733 million yen due mainly to purchase of treasury stock of 1,799 million yen and cash dividends paid of 975
million yen. For a comparison, in the net cash provided by (used in) financing activities of the corresponding
quarter of the previous year, there was a decrease of funds by 1,249 million yen.
(3) Qualitative Information Concerning Consolidated Forecast and Other Future Predictions
Revision of Consolidated Forecast for Fiscal 2013, Ending March 31, 2014 (from April 1, 2013 to March 31, 2014)
Net sales

Net income

Operating income

Ordinary income

Millions of yen

Millions of yen

Millions of yen

Millions of yen

Yen

Previous forecast (A)215,000

4,600

4,800

3,000

92.41

Revised forecast (B)225,000

5,000

5,000

3,100

98.00

Change (B-A)

10,000

400

200

100

－

4.7

8.7

4.2

3.3

－

206,534

3,673

4,111

2,814

84.40

Change (%)

Net income

per share(Reference)
Actual results for the fiscal
year ended March 31, 2013

Because it is expected that sales of system LSIs and memories for smartphones will exceed our initial projection, we
have revised our consolidated business forecast for fiscal 2013 to net sales of 225,000 million yen (up 8.9%
year-on-year), operating income of 5,000 million yen (up 36.1%), ordinary income of 5,000 million yen (up 21.6%)
and net income of 3,100 million yen (up 10.1%).We have not revised dividend forecast associated with this revisionof business forecast.

-3-

2. Items Regarding Summary Information (Notes)(1) Transfer of major subsidiaries during the scope of consolidation of this quarter
None(2) Applying accounting procedures specific to preparing quarterly financial statements
None(3) Changes in accounting principles, changes in accounting estimates and restatements
None

-4-

3. Consolidated Quarterly Financial Statements(1) Consolidated Quarterly Balance Sheets(Millions of yen)
Fiscal Year Ended
March 31, 2013
(As of March 31, 2013)

First Half of the Fiscal YearEnding March 31, 2014
(As of September 30, 2013)ASSETS
Current assets
Cash and deposits

50,46446,453

Trade notes and accounts receivable

68,101

70,334-2,999

Inventories

19,08822,301

Accrued income

1,390

1,127

Deferred tax assets

514

243

Other current assets

243

353

Allowance for doubtful accounts

(106)

(240)

139,696

143,572

Buildings and structures (net)

4,290

4,211

Land

8,121

8,120

Lease assets (net)

333

368

Other fixed assets (net)

526

576

13,272

13,277

1,029

1,052

Investment securities

3,286

3,729

Deferred tax assets

947

966

Other

3,132

2,827

Allowance for doubtful accounts(1,045)(1,070)Allowance for loss on investments

(98)

-

Total investments and other assets

6,222

6,452

20,524

20,783

160,220

164,356

Marketable securities

Total current assets
Fixed assets
Property, plant and equipment

Total property, plant and equipment
Intangible fixed assets
Investments and other assets

Total fixed assets
Total assets-5-

(Millions of yen)
Fiscal Year Ended
March 31, 2013
(As of March 31, 2013)

First Half of the Fiscal YearEnding March 31, 2014
(As of September 30, 2013)

LIABILITIESCurrent liabilities
Trade accounts payable

25,261

29,065

Short-term bank loans

12,85013,600

Lease obligations

138

139

Other payable

841

644

1,069

1,149

Accrued income taxes

689

442

Other current liabilities

178

44

Total current liabilities

41,02845,087

242

280

2,149

2,086

Other long-term liabilities

76

73

Total long-term liabilities

2,469

2,440

43,49847,527

Common stock

17,69017,690Additional paid-in capital

19,114

19,114Retained earnings

84,59079,980Treasury stock(3,789)(73)

Total shareholders’ equity

117,606

116,712

484

974

0

(3)

(1,368)

(855)

(883)

116

Total net assets

116,722

116,829

Total liabilities and net assets

160,220

164,356

Accrued expenses

Long-term liabilities
Lease obligations
Employees’ retirement benefits

Total liabilities
NET ASSETS
Shareholder’s equity

Other accumulated comprehensive incomes
Net unrealized gain on other marketable securities
Gain (loss) on deferred hedges
Foreign currency translation adjustments
Total other accumulated comprehensive incomes-6-

(2) Consolidated Quarterly Statements of Income and Consolidated Quarterly Comprehensive Statements ofIncome(Consolidated Quarterly Statements of Income)(Scope of Consolidation of this First Half Period)(Millions of yen)First Half of the Fiscal Year
Ended March 31, 2013

First Half of the Fiscal YearEnding March 31, 2014

(Apr. 1, 2012 to Sep. 30,2012)(Apr. 1, 2013 to Sep. 30, 2013)

Net sales
Cost of Sales
Gross Profit
Selling, general and administrative expenses
Operating income
Non-operating income
Interest income
Dividend income
Gain on foreign exchange
Commission fee
Miscellaneous income
Total non-operating income
Non-operating expenses
Interest expense
Foreign currency transaction loss
Miscellaneous expenses
Total non-operating expenses
Ordinary income
Extraordinary gains
Gain on sales of noncurrent assets
Gain on reversal of allowance for doubtful accounts
Total extraordinary gains
Extraordinary losses
Impairment loss
Loss on valuation of investment securities
Loss on valuation of golf club membership
Total extraordinary losses
Income before income taxes and minority interests
Income taxes
Income before Minority interest in income
Net income-7-106,185
97,569
8,615
6,496
2,119

111,092
101,992
9,100
6,892
2,208

44
94
5
277
108
530

19
30
99
89
238

92
18
111
2,538

76
209
9
294
2,152

33
12
46

2
2

3
35
1
39
2,544
991
1,552
1,552

2,155
814
1,340
1,340

(Consolidated Quarterly Comprehensive Statements of Income)(Scope of Consolidation of this First Half Period)(Millions of yen)First Half of the Fiscal Year
Ended March 31, 2013

First Half of the Fiscal YearEnding March 31, 2014

(Apr. 1, 2012 to Sep. 30, 2012)(Apr. 1, 2013 to Sep. 30, 2013)

Income before Minority interest in income
Other comprehensive income
Net unrealized gain on other marketable securities
Gain (loss) on deferred hedges
Foreign currency translation adjustments
Total other comprehensive income
Comprehensive Incomes(Details)
Comprehensive incomes relating to shareholders ofparental company

-8-

1,552

1,340

(182)
(4)
(584)

490
(3)
513

(771)
781

1,000
2,341

781

2,341

(3) Consolidated Quarterly Statements of Cash Flows(Millions of yen)First Half of the Fiscal Year
Ended March 31, 2013

First Half of the Fiscal YearEnding March 31, 2014

(Apr. 1, 2012 to Sep. 30, 2012)(Apr. 1, 2013 to Sep. 30, 2013)

Operating activities
Quarterly income before income taxes
Depreciation and amortization
Impairment loss
Increase (decrease) in allowance for doubtful accounts
Increase (decrease) in provision for retirement benefits
Increase (decrease) in allowance for loss on investments
Interest and dividends income
Interest expenses
Loss (gain) on valuation of investment securities
Loss (gain) on sales of property, plant and equipment
Decrease (increase) in notes and accounts receivable-trade
Decrease (increase) in inventories
Increase (decrease) in notes and accounts payable-trade
Other
SubtotalInterest and dividends income received
Interest expenses paid
Income taxes (paid) refund
Net cash provided by (used in) operating activities
Investing activities
Proceeds from withdrawal of time deposits
Purchase of property, plant and equipment
Proceeds from sales of property, plant and equipment
Purchase of intangible assets
Payments of loans receivableCollection of loans receivable
Proceeds from sales of investments in capital
Purchase of insurance funds
Proceeds from cancellation of insurance funds
Net cash provided by (used in) investing activities
Financing activities
Net increase (decrease) in short-term loans payable
Repayments of lease obligations
Purchase of treasury stock
Cash dividends paid
Net cash provided by (used in) financing activities
Effect of exchange rate change on cash and cash equivalents
Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents at the beginning of the period
Increase in cash and cash equivalents from newly consolidated
subsidiary
Cash and cash equivalents at the end of the period

-9-

2,544
307
3
(41)
(55)
(12)
(138)
92
35
(33)
6,928
1,476
(5,311)
857
6,651
144
(93)
(441)
6,260

2,155
397
153
(94)
(50)
76
(2)
(882)
(2,426)
2,949
(66)
2,206
49
(69)
(794)
1,391

1,500
(50)
73
(17)
(2)
0
(111)
99
1,491

(110)
3
(101)
0
5
(203)

(516)
(63)
(0)
(669)
(1,249)(228)
6,274
34,113122(80)(1,799)(975)(2,733)118(1,426)50,463-415

40,38749,451

(4) Notes Regarding Consolidated Quarterly Financial Statements(Notes Regarding Going Concern)
Not applicable.
(Notes Regarding Substantial Changes in Shareholders’ Equity)
Not applicable.
(Segment Information)
I. For the consolidated first half period of the fiscal year ended March 31, 2013
(April 1, 2012 to September 30, 2012)
1. Overview of our Reporting Segments
Information Concerning Sales and Income or Loss Amount by Reporting Segment(Millions of yen)

Reportable Segment
Adjusted
amount(Note) 1

Consolidated
quarterly
incomestatement
amount (Note) 2

Semiconductors

Electronic
components

Electronicequipment

Ryosanproducts

Total

67,106

26,884

9,620

2,573

106,185―

106,185

―

―

―

―

―

―

―

67,106
1,169

26,884
660

9,620
334

2,573
39

106,185
2,202

―
(83)

106,185
2,119

Sales and operating income
Sales:
Sales to external
Customers
Internal sales between
segments, or exchange
Total
Segment income(Notes)1. The adjustment of -83 million yen to segment income represents corporate expenses that are not allocated to eachreportable segment.
2. Segment income has been adjusted with operating income in consolidated quarterly statements of income.
II. For the consolidated first half period of the fiscal year ending March 31, 2014
(April 1, 2013 to September 30, 2013)
Information Concerning Sales and Income or Loss Amount by Reporting Segment(Millions of yen)

Reportable Segment
Adjusted
amount(Note) 1

Consolidated
quarterly
incomestatement
amount (Note) 2

Semiconductors

Electronic
components

Electronicequipment

Ryosanproducts

Total

74,33225,895

8,285

2,579

111,092―

111,092

―

―

―

―

―

―

―

74,332
1,364

25,895
654

8,285
307

2,579
(2)

111,092
2,323

―
(115)

111,092
2,208

Sales and operating income
Sales:
Sales to external
Customers
Internal sales between
segments, or exchange
Total
Segment income (loss)(Notes)1. The adjustment of -115 million yen to segment income represents corporate expenses that are not allocated to eachreportable segment.
2. Segment income has been adjusted with operating income in consolidated quarterly statements of income.
III. Beginning from the current first quarter consolidated accounting period, we revised the allocation method forcompany-wide expenses, etc. A portion of company-wide expenses, etc. for which allocation was previously not possible
are now allocated to each reporting segment according to applicable allocation standards.
Segment information for the previous consolidated cumulative first half period shows numbers which were calculated
based on the allocation method for company-wide expenses, etc. after the change described above.

- 10 -

4. Supplementary Information(1) Geographical Segment Information
Fiscal 2012, first half period of the fiscal year ended March 31, 2013
(April 1, 2012 to September 30, 2012)(Millions of yen)Japan
I Sales and operating income
Sales:(1) Sales to external
Customers(2)Internal sales between
segments, or exchange
Total
Segment income

Asia

Total

Eliminations
or corporate

Consolidated

72,13734,047106,185―

106,185

2,731

236

2,967

(2,967)―74,869964

34,283
1,042

109,152
2,006(2,967)
112

106,185
2,119

Notes:
1. Country and regional segments are classified on the basis of geographic proximity.
2. Principal countries and regions:
Asia: Hong Kong, China, Thailand, Korea and others

Fiscal 2013, first half period of the fiscal year ending March 31, 2014
(April 1, 2013 to September 30, 2013)(Millions of yen)

I Sales and operating income
Sales:(1) Sales to external
Customers(2)Internal sales between
segments, or exchange
Total
Segment income

Eliminations
or corporate

Consolidated

111,092―

111,092

0

4,520(4,520)

―

3,251
111

115,613
1,871(4,520)337

111,092
2,208

Japan

Asia

Other

Total

66,68041,161

3,250

4,257

261

70,938484

41,422
1,275

Notes:
1. Country and regional segments are classified on the basis of geographic proximity.
2. Principal countries and regions:
Asia: Hong Kong, China, Thailand, Korea and others
Other: United States and others- 11 -

(2) Overseas Sales
Fiscal 2012, first half period of the fiscal year ended March 31, 2013
(April 1, 2012 to September 30, 2012)(Millions of yen)Total
37,411
106,18535.2

Asia
37,411―
35.2

Overseas sales
Consolidated net sales
Ratio of overseas sales to consolidated net sales (%)

Notes:
1. Country and regional segments are classified on the basis of geographic proximity.
2. Principal countries and regions:
Asia: China, Hong Kong, Thailand, Korea and others
3. Overseas sales represent the total of export sales of the parent company and sales of its consolidated subsidiaries outside Japan(excluding intra-group sales).

Fiscal 2013, first half period of the fiscal year ending March 31, 2014
(April 1, 2013 to September 30, 2013)
Overseas sales
Consolidated net sales
Ratio of overseas sales to consolidated net sales (%)

Asia
47,753
―
43.0

Other
3,852
―
3.5

(Millions of yen)Total
51,606
111,092
46.5

Notes:
1. Country and regional segments are classified on the basis of geographic proximity.
2. Principal countries and regions:
Asia: China, Korea, Hong Kong, Thailand and others
Other: United States and others
3. Overseas sales represent the total of export sales of the parent company and sales of its consolidated subsidiaries outside Japan(excluding intra-group sales).

- 12 -