SOFTBANK CORP.
CONSOLIDATED FINANCIAL REPORTFor the fiscal year ended March 31, 2004
Tokyo, May 10, 2004
FINANCIAL HILIGHTS
1.

Results of Operations(Million yen; amounts less than one million yen are omitted.)
Net Sales

Operating loss

AmountFY 2004
April 2003 throughMarch 2004
FY2003
April 2002 throughMarch 2003

AmountNet lossAmount%Amount%%%¥517,393

27.2¥(54,893)-¥(71,901)-¥(107,094)-¥406,892

0.4¥ (91,997)-¥ (109,808)-¥ (99,989)-

Net loss per
share— primary(yen)
FY 2004
April 2003 throughMarch 2004
FY2003
April 2002 throughMarch 2003

Ordinary loss

Net loss per share—
diluted (yen)Negative return

Ordinary loss /on Equity

Total assets

Ordinary loss /(%) Net sales

(%)

(%)

¥(314.72)-(43.2)(6.1)(13.9)¥ (296.94)-(27.7)(10.4)(27.0)

Notes:
1.

Equity in gain (loss) under the equity method, net:
Fiscal Year ended March 31, 2004:
Fiscal Year ended March 31, 2003:¥ (2,276) million¥11,107 million

2.

Average number of shares issued and outstanding during the year (consolidated)Year ended March 31, 2004:
340,407,372 sharesYear ended March 31, 2003:
336,857,133 shares

3.

No changes in accounting methods for the fiscal year ended March 31, 2004.

4.

Percentage changes for net sales, operating loss, ordinary loss and net loss are compared with the corresponding period of
the previous fiscal year.

12.

Financial Condition(Million yen; amounts less than one million yen are omitted.)
Shareholders’
Total assets

Shareholders’ equity
Equity ratio (%)

equityFY2004
March 31, 2004

¥1,421,206¥238,080

16.8¥677.40

FY2003
March 31, 2003

¥946,331¥257,39627.2¥767.56

Note: Number of shares outstanding (consolidated)
As of March 31, 2004:
As of March 31, 2003:
3.

FY 2004
April 2003 throughMarch 2004
FY2003
April 2002 throughMarch 2003

(Million yen; amounts less than one million yen are omitted.)
Cash and cash
Investing activities
Financing activities
equivalents
at the end of the period¥(83,829)¥81,878¥306,390¥437,132¥ (68,600)¥119,749¥(17,615)¥147,526

Scope of Consolidation at March 31, 2004
Consolidated subsidiaries:
Equity-method non-consolidated subsidiaries:
Equity-method affiliates:

5.

351,404,096 shares
335,293,326 shares

Cash Flows

Operating activities

4.

per share (yen)

177
6
97

Changes in Scope of Consolidation for the Fiscal Year ended March 31, 2004
Consolidated subsidiaries:
Newly added:
Excluded:

19
111

Equity-method non-consolidated
subsidiaries and affiliates:
Newly added:
Excluded:6
192

The SOFTBANK GroupAs of March 31, 2004, the SOFTBANK Group comprised 280 companies with operation in 8 segments as follows.

Business segment

Consolidated
subsidiaries

Equity-method
non-consolidated
subsidiaries andaffiliates

1.

Broadband
Infrastructure

15

7

2.

e-Commerce

18

7

3.

e-Finance

42

9

4.

Media & Marketing

10

6

5.

Broadmedia

14

2

6.

Internet Culture

17

5

7.

Technology Services

7

3

8.

Overseas Funds

38

61

9.

Others16

3

Principal products and operational content of each business
ADSL high-speed Internet connection service and IP telephonyservice; fiber-optic ultra-high-speed Internet connection service andother operations
Distribution of PC software and such hardware as PCs andperipherals; enterprise solutions; diversified e-commerce businesses,
including business transaction platform (B2B) and consumer-related
e-commerce (B2C)
All-inclusive financial operations, including on-line security
business; management of domestic venture capital funds; incubationof portfolio companies
Book and magazine publication in such areas as PCs, the Internet,
entertainment, etc.; development of web content specialized in IT
Provision of applications and content for broadband broadcasting andcommunications and promoting the spread of such operations
Internet-based advertising operations; broadband portal business;
Internet-based auction business
System solution business; business solution business
U.S.- and Asia-focused global venture capital business with a main
focus on Internet-related companies
Holding company functions for overseas operations; back-officeservices in Japan

177
103
Total
Note: SOFTBANK BB Corp., which is engaged in the Broadband Infrastructure and e-Commerce segments, is included in the
Broadband Infrastructure segment; Yahoo Japan Corporation, which is engaged in the Internet Culture and Broadband Infrastructure
segments, is included in the Internet Culture segment. Both of them are consolidated subsidiaries.
Broadband Infrastructure［ Overseas ］

e-Commerce［ Domestic ］
Dee Corp.

IP REVOLUTION, INC.

Vector Inc.

SOFTBANK BB Corp.
Yahoo Japan Corporation

Internet Culture

e-Finance

Carview Corporation
SOFTBANK INVESTMENTCORPORATION（Operation Holding
Companies）

E*TRADE SECURITIES CO., LTD.

Tavigator, Inc.

Morningstar Japan K.K.
e-Shopping! Books CORP.

［ Overseas ］［ Domestic ］

SOFTBANKFINANCECORPORATIONSOFTBANK CORP.
(Pure Holding Company)（Operation Holding
Companies）

SOFTBANK
Broadmedia
Corporation

Club iT Corporation

SOFTBANK
Holdings Inc.
（Operation Holding
Companies）

BB Cable Corporation

Broadmedia（Operation Holding
Companies）

SOFTBANKTECHNOLOGYHOLDINGS CORP.

Finance All Corporation［ Domestic ］［ Overseas ］

SOFTBANK Korea Co., Ltd.

SB CHINA HOLDINGS PTE LTD

SOFTBANK Media &Marketing Corp.

SOFTBANK Publishing Inc.

SOFTBANK TECHNOLOGY CORP.

Morningstar Inc.

WORLD NICHIEI FRONTIER
Securities Co., Ltd.

Overseas Funds
SOFTBANK US Ventures VI LP

Softbank ITmedia Inc.

［ Domestic］

cyber communications inc.

Media & MarketingTechnology Services［ Overseas ］

Note: Change on April 1, 2004 or later
On June 18, 2004, SOFTBANK CORP. will merge with SOFTBANK TECHNOLOGYHOLDINGS CORP. with the former the surviving company.

・・・・ Segment・・・・ Consolidated subsidiary・・・・ Equity-method subsidiaryor affiliate

3

SOFTBANK subsidiaries listed on domestic stock exchanges as of March 31, 2004:
Subsidiary

Listed exchange

1.Yahoo Japan Corporation

Tokyo Stock Exchange 1st section

2.SOFTBANK TECHNOLOGY CORP.

JASDAQ

3.Morningstar Japan K.K.

Hercules

4.Vector Inc.

6.Club iT Corporation

HerculesTokyo Stock Exchange 1st section
Osaka Securities Exchange 1st section
Hercules7. Finance All Corporation

Hercules8. WORLD NICHIEI FRONTIER Securities Co., Ltd.

Hercules5.SOFTBANK INVESTMENT CORPORATION

4

Management Policies
1. Fundamental Management Policy
The core management philosophy of the SOFTBANK Group (hereafter “the Group”) is“Endeavoring to benefit society and the economy by fostering the sharing of wisdom andknowledge gained through the IT revolution.” By conducting business activities in a creative
manner, the Group focuses its energy on both contributing to the development of society andincreasing its corporate value. Based on its vision of using broadband to accelerate the IT
revolution and make it a success, the Group in fiscal 2004 continued to place the highest priority
on the broadband business domain.
Japan’s broadband market continues to expand rapidly. Expansion is being driven by the Yahoo! BB
comprehensive broadband service, which the Group started offering on a commercial basis in September 2001.
As society as a whole quickly evolves into a digital information society and enters the ubiquitous informationage, the Group will continue to contribute to the development of society by offering revolutionary services bydrawing on its foresight and innovative ideas in the broadband domain. The Group’s policy is to increase its
corporate value by taking full advantage of opportunities to generate earnings, mainly in broadband businesses,
as it adapts to changes in the business environment in a flexible and speedy manner.
2. Policy Regarding Allocation of Earnings
The fundamental policy of SOFTBANK CORP. (hereinafter called “the Company”) is to increase the profits ofshareholders by raising its corporate value while strengthening its operating base and profitability, returning
earnings to shareholders and all other stakeholders in a suitable manner.
The Company’s policy regarding dividends is to set dividend payments while taking into consideration theneed to maintain the proper balance between measures to bolster the operating base and to preserve a stabledividend from a medium- and long-term perspective. Based on this policy, the Company has proposed a
dividend of ¥7 per share, the same as in fiscal 2003.
3. Medium- and Long-Term Strategies
The SOFTBANK Group’s strategies over the medium and long terms are as follows:(1) Generate and maximize stable earnings and cash flows by succeeding in the broadband infrastructurebusiness.
(2) Create a broad array of opportunities for generating and maximizing earnings and cash flows inInternet-based Group companies by leveraging synergies between these companies and the broadband
infrastructure business.
(1)

Succeed in the broadband infrastructure business

In March 2004, the cumulative number of lines installed in the Group’s Yahoo! BB service surpassed 4 million.
Firmly positioned as the leader in the ADSL service market among Japan’s communications carriers and ISPs,
this service continues to drive the expansion of this market. The Group’s next target is to raise cumulative
number of lines installed to more than 6 million by September 2005. The Group also continues to hold an5

overwhelming lead (based on Company data) in the IP telephony market, where the cumulative lines installedof its BB Phone IP telephone service reached 3.78 million at the end of March 2004.
During fiscal 2004, the Group launched the Yahoo! BB 26M and Yahoo! BB 45M services and started thefull-scale deployment of wireless LAN Pack, increasing the number of users of services with a high degree ofadded value. The Group plans to further expand the customer base while preserving the proper balance withother management resources and raising average revenues per user. Through these actions, the Group intends
to generate and maximize stable earnings and cash flows by succeeding in the broadband infrastructurebusiness.
(2)

Leverage synergies between Internet-based Group companies and the broadband infrastructure business

The Group has assembled the world’s largest full-IP network with the provision of visual, voice and otherservices in mind. From this base, the Group is also developing businesses in broadband-related markets as well,drawing on know-how gained by Internet-based Group companies and on synergies with the broadband
infrastructure business.
Yahoo Japan Corporation is benefiting from the widespread availability of high-speed, high-capacity,
always-on Internet connections. Its advertising business is performing very well and its auction and shopping
businesses are growing. BB Cable Corporation, which offers the BB Cable TV service over the Yahoo! BB
ADSL network, is increasing the number of channels and enlarging its content lineup for video-on-demand.
This company will continue using the Yahoo BB! service’s infrastructure and customer base to deploy its
business. SOFTBANK BB Corp. began offering a service for application streaming distribution. All groupcompanies are working together to generate and maximize diversified earnings sources and cash flows by
utilizing the broadband infrastructure business .
4. Important Management Issues<Achieve Profitability in the Broadband Infrastructure Business and Increase Earnings Power>
In the broadband infrastructure business, substantial expenses are temporarily being incurred to acquire
customers and for other purposes as this business is in its start-up and growth phases. The Group is working tocontinue to increase the number of lines installed and paying customers while maintaining the proper balance
between growth in the customer base and the level of expenses. The Group is also working to expand services
with a high degree of added value to increase average revenue per user and boost profit margins. Throughthese measures, the Group aims to achieve profitability at an early stage and increase earnings power in the
broadband infrastructure business.
<Growth in Segments Outside the Broadband Infrastructure>
Now that high-speed, high-capacity, always-on Internet connections are readily available, the Group expects tosee further growth in opportunities to generate profits at Group companies whose operations are rooted in theInternet. The operating income of segments outside the broadband infrastructure became profitable in fiscal
2003 and generated a large increase in fiscal 2004. The Group will maximize synergies between thesecompanies and its broadband infrastructure business with the aim of generating more growth.
6<Strengthen Management System for Information Security>
During fiscal 2004, an incident involving the unauthorized acquisition of Yahoo! BB customer information
occurred at SOFTBANK BB Corp.
To prevent this problem from occurring again, SOFTBANK BB Corp. is focusing all its energy on building themost effective information security management system as quickly as possible. The goal is to position theYahoo! BB brand as a symbol of “safety and reliability” over the medium and long terms. In addition tomeasures taken at SOFTBANK BB Corp., the entire Group has begun taking concrete actions to reinforce
security regarding the management of information. The Group regards this incident as a valuable lesson. All
executives and employees have been made well aware that the establishment of the best possible information
security management system is one of the highest priorities of the Group. The Group is working as one toprotect all of its information resources.
5. Fundamental Policy and Measures Regarding Corporate Governance<Fundamental Policy for Corporate Governance>
The Company believes that corporate governance is essential to conducting management that places priority on
shareholders and cash flows. As a pure holding company, the Company manages and coordinates the Group’s
diverse businesses, mainly through its board of directors and CEO Conference, while respecting theindependence and specialized knowledge of each Group company, and is working to strengthen its Groupmanagement system.
<Enactment of Measures Regarding Corporate Governance>(1) Management organization and other corporate governance items related to management decision-making
and the execution and supervision of business operations(a) Corporate governance units
The Company has a corporate auditor system. Three of the four corporate auditors are from outside the Group,
ensuring objectivity, fairness and transparency. The auditors monitor the performance of directors in theexecution of their duties with regard to all business activities. The Board of Directors has nine members,
including three from outside the Group. The directors make decisions regarding important management issues
and supervise the execution of business operations. In addition, a CEO Conference composed of theCompany’s representative director and the CEOs of each business segment and others is held each month. The
Conference coordinates management policies for the entire Group, manages operating results of Group
companies and performs other tasks.
A consulting attorney provides advice and guidance as necessary regarding daily business operations andmanagement decisions. This attorney also attends all meetings of the Board of Directors and CEO Conference
to provide advice and guidance. This adds transparency to Group management and reinforces complianceactivities.

7

(b) Internal controls
The Group has an internal control framework for the purpose of raising the efficiency of business management
and promoting compliance activities. Based on a plan, the Internal Audit Department conducts operational
audits covering all management and business activities. These audits evaluate and verify compliance by theCompany and the entire Group with management policies, laws, articles of incorporation, regulations,guidelines and other applicable rules. Furthermore, this department gives specific suggestions and directives inorder to improve operations as well as to prevent problems from occurring in advance.
(2) Significant personal, financial, business or other relationships between the Group and external directors andexternal corporate auditors
There are no applicable items.
(3) Measures taken during the past year to improve corporate governance(a) From the standpoint of stressing accountability to stakeholders, the Group began releasing quarterly resultsof operations beginning with the first quarter of fiscal 2004, thus better disclosing information in a timely andappropriate manner. In the first and third quarters, the Group released information on the same level as in its
interim financial statements.
(b) Concrete measures were enacted to strengthen the management system for information security. At
SOFTBANK BB Corp., a chief information security officer (CISO) was appointed to clarify responsibility for
information security and establish a framework for the effective execution of various measures. Additionally,
the Privacy Management Advisory Board, which is made up of specialists from outside the Group who arewell versed in crisis management and privacy issues, was established, giving the Group evaluations and advice
on information management from an objective standpoint. This committee submitted its first report in March
2004. Moreover, a Technical Advisory Board has been established. Members, who are prominent experts in thefields of networks and Internet security, provide the Group with objective evaluations and advice concerning
systems, networks, security and related matters. For the purpose of developing security policies and internal
regulations, and strengthening the auditing system, an Information Security Committee has been establishedthat consists of the individuals in charge of information security of each business segment.
To further reinforce information security management systems across the Group, the entire Group is taking
concrete actions, including the appointment of a CISO in each company and development of a security policy
applicable to the entire Group.
6. Other items
Fundamental policy regarding relationships with related parties
There are no applicable items.
Important items regarding the Company’s management
There are no applicable items.
8

Results of Operations and Financial Position
1. Management’s Analysis of Results of Operations and Financial Position
During fiscal 2004, the Group continued to concentrate on the broadband business. Actions continued to focus
on acquiring more customers to expand the scale of operations with the goal of maximizing future earnings
and cash flows. As a result, the Group reported an operating loss, ordinary loss and net loss for the year,
primarily due to customer-acquisition costs and other up-front expenses. However, net sales were higher thanin fiscal 2003 and there was a large decline in the operating loss. Management believes this shows that its
broadband business model has been established. There was also a substantial year-on-year improvement in
operating income at segments outside broadband infrastructure.
Regarding the financial position, the equity ratio declined compared with the end of fiscal 2003, but theCompany conducted equity financing during fiscal 2004 to help offset the decline in shareholders’ equity. In
addition, funds were procured in various ways during fiscal 2004. As a result, cash and cash equivalents at theend of fiscal 2004 substantially increased compared with the end of fiscal 2003.
2. Consolidated Results of Operations<Overview of Fiscal Year Results>
Net sales increased ¥110,501 million, or 27%, to ¥517,393 million. Net sales increased ¥88,899 million to¥128,906 million in the Broadband Infrastructure segment due to growth in the number of paying customers inYahoo! BB service and other factors. In addition, net sales increased in the Internet Culture and e-Financesegments.
The operating loss decreased ¥37,103 million to ¥54,893 million. Operating income increased ¥15,700 million
to ¥32,582 million in the Internet Culture segment and the e-Finance segment reported operating income of¥5,911 million compared with the prior year’s loss of ¥5,823 million. In addition, the operating loss in the
Broadband Infrastructure segment decreased due to the increase in net sales and other factors. Aggregate
operating income for the segments outside the broadband infrastructure continued to increase, rising to¥32,703 million.
The ordinary loss decreased ¥37,907 million to ¥71,901 million. There was a net non-operating loss of ¥17,007
million, ¥803 million less than in fiscal 2003. The previous year’s exchange loss of ¥7,704 million became again of ¥6,508 million due to the yen’s appreciation. However, an increase in interest-bearing debts caused net
interest expense to increase ¥3,603 million to ¥11,252 million. Furthermore, net equity in loss under theequity-method was ¥2,276 million in fiscal 2004 due to the decrease in equity in gain under the equity-methodfrom Aozora Bank, Ltd. and other factors, while net equity in gain under the equity-method of ¥11,107 million
was recorded in fiscal 2003. In addition, there was a valuation loss on inventories of ¥10,052 million
associated with modems and other equipment purchased at the initial stage of the Broadband Infrastructurebusiness.

9

The net loss increased ¥7,104 million to ¥107,094 million. Special income was ¥42,786 million and special
loss was ¥47,629 million, resulting in a net special loss of ¥4,843 million. As a result, the loss before income
taxes and minority interest increased ¥5,269 million to ¥76,744 million. The major component of special
income was a gain on sale of investment securities of ¥37,601 million, mainly the partial sale of shares held in
SOFTBANK INVESTMENT CORPORATION, UTStarcom, Inc. and cyber communications inc. The special
loss included a loss on sale of investment securities of ¥10,585 million, mainly the sale of shares held in
Aozora Bank, Ltd., and a valuation loss on investment in affiliates of ¥9,188 million, mainly resulting from a
one-time amortization of goodwill for SOFTBANK Korea Co., Ltd., due to a revaluation of its portfolio
companies.
<Overview of Fourth Quarter Results (three-month period)>
In the fourth quarter of fiscal 2004 (January 1, 2004 to March 31, 2004), net sales was ¥155,239 million, theoperating loss was ¥8,884 million, the ordinary loss was ¥9,626 million and the net loss was ¥13,410 million.
Net sales in the Broadband Infrastructure segment increased every quarter in fiscal 2004, rising to ¥40,935
million in the fourth quarter and net sales in the e-Commerce segment increased ¥11,222 million comparedwith the third quarter.
The operating loss increased ¥2,231 million compared with the third quarter. This was mainly attributable to anincrease in customer-acquisition costs in the Broadband Infrastructure segment and a decrease in operating
income in the e-Finance segment because there was no sale of operational investment securities during thefourth quarter.
In non-operating income/expenses items, there were a net exchange gain of ¥1,433 million as the yen
appreciated and a net interest expense of ¥3,439 million as the issuance of bonds and other procurements
caused interest-bearing debts to increase.
Special income included a ¥17,060 million gain on sale of investment securities, including the partial sale ofshares held in SOFTBANK INVESTMENT CORPORATION. An extraordinary cost for information security
measures of ¥3,176 million was recorded as a special loss. This mainly represents expenses for cash voucher in
conjunction with the unauthorized acquisition of customer information in the Yahoo! BB service.
<Fiscal Year Results by Business Segment>
Broadband Infrastructure—Segment sales increased ¥88,899 million, or 222%, to ¥128,906 million.
Expansion in the scale of the Yahoo! BB service contributed to sales growth at SOFTBANK BB Corp. and ISP
revenue increase at Yahoo Japan Corporation. As a result, this segment has developed into a businessgenerating annual sales of more than ¥100 billion. Mainly due to customer acquisition costs, the operating loss
was ¥87,597 million, but this was ¥8,607 million less than in fiscal 2003 due to growth in the number ofpaying customers and other factors.
10e-Commerce—Segment sales decreased ¥11,197 million, or 4%, to ¥254,888 million. This was attributable tothe decrease of sales of software to consumers due to a drop in average unit prices and other factors, whereas
the solutions business, mainly involving security, and hardware posted strong sales at SOFTBANK BB Corp.
Operating income increased ¥1,180 million, or 48%, to ¥3,647 million. This was the result of

reducing

selling, general and administrative expenses by rationalizing personnel, logistics and other expenses and also
growth in the solutions business, which has a high profit margin, at SOFTBANK BB Corp., especially in thesecond half.
Among other companies in this segment, operating results were generally better compared with fiscal 2003. In
particular, Carview Corporation and e-Career CORP. (now SOFTBANK Human Capital Corp.) and othercompanies continued to post growth in net sales and operating income.
e-Finance—Segment revenue increased ¥13,260 million, or 47%, to ¥41,427 million. A major source ofgrowth was the sales growth following the acquisition of a controlling stake in WORLD NICHIEI Securities
Co., Ltd.* by SOFTBANK INVESTMENT CORPORATION in October 2003. Other factors were an increasein brokerage commission revenue and financial income from interest and dividends at E*TRADE
SECURITIES CO., LTD. due to the higher trading volume in Japan’s active stock markets. The segment
recorded operating income of ¥5,911 million compared with the loss of ¥5,823 million in fiscal 2003. In
addition to increased operating income at E*TRADE SECURITIES CO., LTD. and the contribution ofWORLD NICHIEI FRONTIER Securities Co., Ltd., the operating income benefited from a decrease in thevaluation loss on operational investment securities and a gain on sale of operational investment securities of
SOFTBANK INVESTMENT CORPORATION.
This segment recorded a ¥9,890 million gain on sale of investment securities as special income in the fourth
quarter, resulting from the partial sale of shares held in SOFTBANK INVESTMENT CORPORATION.
*WORLD NICHIEI Securities Co., Ltd. and SOFTBANK FRONTIER SECURITIES CO., LTD. merged in February 2004 toform WORLD NICHIEI FRONTIER Securities Co., Ltd.

Media & Marketing—Segment sales decreased ¥2,505 million, or 15%, to ¥14,407 million and the operating
loss increased ¥569 million to ¥1,092 million. This performance mainly reflects lower sales of magazines andbooks at SOFTBANK Publishing Inc. amid a prolonged slump in the publishing market.
Broadmedia—Segment sales increased ¥948 million, or 8%, to ¥12,892 million and the operating loss
increased ¥1,689 million to ¥3,305 million. This was mainly attributable to depreciation expenses, leasing fees,development-related expenses, content expenses and others at BB Cable Corporation, which operates the BB
Cable TV service via the ADSL network.
Internet Culture—Segment sales increased ¥25,854 million, or 68%, to ¥64,054 million and operating
income was up ¥15,700 million, or 93%, to ¥32,582 million. Amid signs of recovery in the overall Japanese
advertising market, Yahoo Japan Corporation aggressively sold major advertising products to National
Clients*, such as “brand panels” for top pages and others, capturing more advertising business from theseclients. Sponsor site related sales were also favorable, helping to raise advertising sales to a new record high.
11

In the auction business at Yahoo Japan Corporation, a new system was introduced to boost its server capacityand other infrastructure components were added, enabling this business to handle more than 10 million items.
Moreover, monthly system-use fees for stores were lowered in order to increase auction stores and a package
discount was introduced for stores that also open stores on Yahoo! Shopping. As a result, auction sales
increased substantially.
*Advertisers with significant exposure through other mass media channels.

Technology Services—Segment sales decreased ¥3,125 million, or 12%, to ¥22,603 million. There was anincrease in sales relating to the backoffice service of SOFTBANK TECHNOLOGY CORP., which handles
everything from sales to billing and bill collection on e-commerce sites. However, net sales in the ADSL sales
support service declined. Operating income decreased ¥377 million, or 34%, to ¥736 million. This was mainly
the result of a decline in the gross margin in the broadband solution business and increase of personnel
expenses associated with new businesses at SOFTBANK TECHNOLOGY CORP.
Overseas Funds—Segment revenue decreased ¥834 million, or 25%, to ¥2,443 million. Operating income
was down ¥615 million, or 31%, to ¥1,375 million. This was mainly due to lower fund management fees at
SOFTBANK Holdings Inc.
Others—Segment sales decreased ¥9,990 million, or 63%, to ¥5,871 million, mainly a reflection of lower
sales at SOFTBANK Commerce Korea Corporation. The operating loss decreased ¥2,417 million to ¥3,965
million.
3. Financial Position<Balance Sheet Analysis (comparison of the end of fiscal 2004 with fiscal 2003)>
Current assets increased ¥480,503 million to ¥887,940 million. There was a ¥179,520 million increase in cash
and deposits mainly due to the issuance of convertible bonds (¥150,000 million), common stock (¥48,680
million) and straight bonds (400 million euros, equivalent to ¥55,316 million). In addition, marketablesecurities increased ¥108,599 million due to a loan through a U.S. subsidiary that temporarily invested thefunds in short-term investment trust. There was an increase of ¥193,154 million in cash segregated as deposits
related to securities business and receivables related to margin transactions due to an increase in marginaccounts and trading volume at E*TRADE SECURITIES CO., LTD. and the inclusion of WORLD NICHIEI
Securities Co., Ltd. in the scope of consolidation.
Property and equipment increased ¥12,930 million to ¥115,179 million. Transmission equipment increased¥12,947 million, mainly at SOFTBANK BB Corp. due to growth in the number of lines installed for its Yahoo!
BB service.
Investments and other assets decreased ¥13,345 million to ¥399,001 million. There was a ¥10,951 million
decline in investments in partnerships and increases in the market values of shares held in Yahoo! Inc. and12UTStarcom, Inc. However, the sale of shares held in Aozora Bank, Ltd. caused investment securities to decline¥4,508 million.
Total liabilities increased ¥447,408 million to ¥1,090,337 million. There was a ¥61,715 million decrease in
short-term borrowings but a ¥165,470 million increase in payables related to margin transactions andguarantee deposits received from customers related to securities business mainly at E*TRADE SECURITIESCO., LTD. and WORLD NICHIEI FRONTIER Securities Co., Ltd. Regarding long-term liabilities, corporate
bonds (long-term liabilities) increased ¥175,258 million due to the issuance of convertible bonds and straightbonds, and long-term debt increased ¥134,327 million due to loans through a U.S. subsidiary and other loans.
Shareholders’ equity decreased ¥19,316 million to ¥238,080 million. Accumulated deficits increased¥109,594 million due to the net loss, while net unrealized gain on other securities in relation to stock in Yahoo!
Inc., UTStarcom, Inc. and certain other companies increased ¥65,602 million. In addition, the issuance ofcommon stock raised common stock by ¥24,436 million and additional paid-in capital by ¥24,458 million.
<Cash Flows Analysis>
Cash flows were positive in fiscal 2004 as cash was provided by investing and financing activities while cash
was used in operating activities.
Net cash used in operating activities increased ¥15,228 million to ¥83,829 million. Loss before income taxes
and minority interest was ¥76,744 million, mostly the result of the operating loss in the Broadband
Infrastructure segment, interest paid was ¥11,206 million and income taxes paid were ¥16,174 million.
Depreciation and amortization increased ¥11,960 million to ¥32,864 million.
Net cash provided by investing activities decreased ¥37,871 million to ¥81,878 million. ¥61,472 million wasused for purchase of property and equipment and intangibles, mainly transmission equipment at SOFTBANKBB Corp., and ¥38,945 million for purchase of marketable and investment securities. However, there were
proceeds of ¥151,136 million from sale of marketable and investment securities, including shares held in
Aozora Bank, Ltd. and UTStarcom, Inc. There were also proceeds of ¥29,212 million from the partial sale ofshares held in certain consolidated subsidiaries, including E*TRADE SECURITIES CO., LTD. and
SOFTBANK INVESTMENT CORPORATION.
Net cash provided by financing activities increased ¥324,006 million to ¥306,390 million. Despite the use of¥76,851 million for repayment of short-term borrowings, net, ¥56,870 million for redemption of bonds and¥50,993 million for repayment of long-term debt, there were proceeds of ¥216,636 million from the issuanceof convertible bonds and straight bonds, ¥48,631 million from the issuance of shares and ¥204,828 million
from long-term debt, mainly through a U.S. subsidiary.
As a result of foregoing, cash and cash equivalents at the end of fiscal 2004 totaled ¥437,132 million, an
increase of ¥289,606 million from the end of fiscal 2003.
13

<Factors That May Have a Material Impact on Cash Flows in the Following Fiscal Year>・Growth in Installed Lines at Yahoo! BB
In the broadband infrastructure business, where the Company is concentrating its management resources,
growth in the number of lines installed at Yahoo! BB will result in start-up expenses associated with acquiring
new customers. Therefore, this growth will temporarily have a negative influence on operating cash flows.
・Redemption of Bonds
As of the end of March 2004, the Group had ¥333,221 million of bonds outstanding. Bond redemptions
totaling ¥36,154 million are scheduled for fiscal 2005. The Company issued ¥150,000 million of convertible
bonds in December 2003 and 400 million euros (equivalent to ¥55,316 million) of straight bonds in March
2004 in the Euromarket. The Company has secured adequate sources for the redemption of bonds during fiscal
2005.
・Commitment-line Contract
Upon the end of the term of a commitment-line established in fiscal 2003, the Company entered into a¥100,000 million commitment-line contract with eight financial institutions, which was arranged by Mizuho
Corporate Bank, Ltd. The Company has not decided whether to continue the contract into fiscal 2005. There
were no borrowings through the commitment-line as of the end of March 2004.
[Trends in Cash Flow Indicators]
A summary of trends in cash flow indicators is presented below.
As of March 31,
2004

2003

2002

Equity ratio

16.8％

27.2%

40.0%

Equity ratio (Market cap.)

120.4％

48.9%

68.8%

Debt repayment period

−

−

−

Interest coverage ratio

−

−

−

Notes:
1. The above indicators are calculated using the following formulas based on consolidated figures.
Equity ratio

Shareholders’ equity divided by total assets

Equity ratio (Market cap.)

Market capitalization divided by total assets

Debt repayment period

Interest-bearing debt divided by net operating cash in-flows

Interest coverage ratio

Net operating cash in-flows divided by interest expenses

2. Market capitalization is calculated by multiplying the closing stock price by the number of shares outstanding, netof treasury stock, as at March 31, 2004.
3. Interest-bearing debt is the sum of all consolidated liabilities on which interest must be paid.
4. Net operating cash in-flows and interest expenses are the corresponding figures shown on the consolidated
statements of cash flows.
5. Negative figures are indicated by a “−” sign.

144. Risks relating to our businesses and others
The following is a list of some significant items that may have an effect on the operating results, financial
position and other aspects of the SOFTBANK Group’s operations.
(i) The Group is active in a broad range of markets including broadband-related markets, IT-related distribution
markets, securities transaction markets and other markets. Demand for services and products supplied by theGroup are dependent on economic conditions, trends in these markets and other factors.
(ii) In the IT industry, where the Group conducts its business activities, technological innovation is rapid andcompetition among participants is increasing. The provision of services by the Group and trends in demand forservices supplied by the Group are subject to trends in IT industry technological innovation and competition
among participants.
(iii) The Group’s business activities are governed by a variety of laws and regulations including but not limited
to the Telecommunications Business Law and the Securities and Exchange Law. Revisions to these laws andregulations, and the establishment of new laws and regulations in the future, may prevent the Group fromconducting its business activities as expected.
(iv) Valuations of investment securities held by the Group are affected by economic and stock market
conditions in Japan and overseas, and trends in foreign exchange markets. Furthermore, loans between the
Company and its overseas subsidiaries, the import of communications equipment and other activities arevulnerable to trends in foreign exchange markets.
(v) The Group may not be able to operate new businesses as expected. For example, the Group has acquired apreliminary license to conduct tests regarding the TD-CDMA and CDMA2000, which are third-generation
mobile phone standards. Although tests are now under way, the Group’s entry into a third-generation mobile
phone business will depend on the ability to obtain a commercial license, the trends in demand for this service
and other factors.
(vi) The Group uses dark-fiber owned by NTT to conduct its broadband infrastructure business. The Group has
installed its communications equipment at NTT’s central offices and pays NTT a connection fee. Furthermore,
the Yahoo! BB comprehensive broadband service, which is a core service of the broadband infrastructurebusiness, depends on the Yahoo! brand of Yahoo! Inc. If there is any change in the relationship between theGroup and these companies, the Group may no longer be able to conduct its business activities as expected.
Please note that this is not a complete list of factors that could affect operating results.

15

CONSOLIDATED BALANCE SHEETS(Millions of yen; amounts less than one million yen are omitted.)
March 31, 2003
March 31, 2004
ChangeAmount%%AmountASSETS
Current assets:
Cash and deposits
Notes and accounts receivable - tradeMarketable securities
Inventories
Deferred tax assets
Cash segregated as deposits
related to securities business
Receivables related to margin transactions
Other current assets
Less : Allowance for doubtful accounts
Total current assets¥327,023
87,982
113,659
25,064
5,255

23.0
6.2
8.0
1.8
0.4

¥147,503
64,255
5,059
42,201
7,035

15.6
6.8
0.5
4.5
0.7

¥179,520
23,727
108,599(17,137)(1,780)95,532

6.7

34,574

3.7

60,958181,043
64,105(11,726)
887,940

12.7
4.5
(0.8)
62.5

48,84765,227(7,268)407,437

5.2
6.9
(0.8)
43.1

132,195(1,121)(4,458)
480,503

Transmission equipment
OthersTotal tangible assets

92,231
22,948115,179

6.5
1.6
8.1

79,28422,964102,249

8.4
2.4
10.8

12,947(16)
12,930Intangible assets, net:
Consolidation adjustment
Other intangibles
Total intangible assets

17,02817,028

1.2
1.2

9,830
14,00823,838

1.0
1.5
2.5

(9,830)3,019(6,810)Investments and other assets:
Investment securities
Investments in partnerships
Deferred tax assets
Other assets
Less : Allowance for doubtful accounts
Total investments and other assets

262,906
86,65429,30324,461(4,324)
399,001

18.5
6.1
2.1
1.7
(0.3)
28.1

267,414
97,60632,701
16,417(1,794)412,346

28.3
10.3
3.5
1.7
(0.2)
43.6

(4,508)(10,951)(3,398)8,044(2,530)(13,345)

2,056

0.1

459

0.0

1,597

¥1,421,206

100.0¥946,331 100.0¥474,875

Non-current assets:
Property and equipment, net

Deferred charges

Total assets

16

CONSOLIDATED BALANCE SHEETS

Amount(Millions of yen; amounts less than one million yen are omitted.)
March 31, 2003
ChangeAmount%%¥47,61388,841
11,00036,154

3.3
6.3
0.8
2.5

¥58,534
150,557
4,000
56,279

6.2
15.9
0.4
6.0

¥(10,920)(61,715)
7,000(20,124)

66,4204.7

74,8197.9(8,399)18,858233
160,382

1.3
0.0
11.3

10,912
5,97844,458

1.2
0.6
4.7

7,946
(5,744)
115,924

84,111

5.9

34,565

3.7

49,54542,1253.0

18,3991.9

23,726555,74239.1

458,504

48.5

97,237

297,067
142,477
58,212
1,721
33,745

20.9
10.0
4.1
0.1
2.4

121,808
8,149
33,285
20,617

12.9
0.8
3.5
2.2

175,258
134,327
24,926
1,721
13,127533,224

37.5

183,862

19.4

349,362

Reserves under special laws:
Reserve for securities trading liabilities

1,267

0.1

494

0.0

773

Reserve for commodities trading liabilities

103

0.0

67

0.0

35

Total reserves under special laws

1,371

0.1

561

0.0

809

1,090,337

76.7

642,92967.9

447,408

92,787

6.5

46,005

4.9

46,782

162,303 11.4
186,690 13.1
(210,625) (14.8)
7.4
105,198(9,462) (0.6)
4,044
0.3
(66) (0.0)

137,867 14.6
162,231 17.1
(101,031) (10.7)
39,595
4.2
20,932
2.2(2,199) (0.2)

24,43624,458(109,594)
65,602(9,462)(16,888)
2,132

238,080

257,39627.2(19,316)¥946,331 100.0¥474,875

March 31, 2004
LIABILITIES ANDSHAREHOLDERS' EQUITYCurrent liabilities:
Notes and accounts payable - trade
Short-term borrowings
Commercial paper
Current portion of corporate bonds
Accounts payable - otherand accrued expenses
Income taxes payable
Deferred tax liabilities
Payables related to margin transactions
Guarantee deposits received from customers
related to securities business
Other current liabilities
Total current liabilities
Long-term liabilities:
Corporate bonds
Long-term debt
Deferred tax liabilities
Consolidation adjustment
Other liabilities
Total long-term liabilities

Total liabilities
Minority interestin consolidated subsidiaries
Shareholders' equity:
Common stock
Additional paid-in capital
Accumulated deficits
Net unrealized gain on other securities
Net unrealized loss on derivative instruments
Translation adjustments
Less: Treasury stock
Total shareholders' equity
Total liabilities andshareholders' equity

16.8¥1,421,206 100.0

17

CONSOLIDATED STATEMENTS OF INCOME(Millions of yen; amounts less than one million yen are omitted.)
FY2004
April 2003 throughMarch 2004
AmountNet sales
Cost of sales
Gross profit
Selling, general and administrative expenses
Operating loss
Interest income
Exchange gain
Equity in gain under the equity method
Reversal of warrants due to expiration
Other non-operating income%¥517,393 100.0
384,024 74.2
133,369 25.8
188,263 36.4
(54,893) (10.6)

FY2003
April 2002 throughMarch 2003
AmountChange%¥406,892 100.0
361,243 88.8
45,648 11.2
137,646 33.8
(91,997) (22.6)¥110,501
22,78087,721
50,617
37,103Non-operating income
Interest expense
Exchange loss
Equity in loss under the equity method
Valuation loss on inventories
Other non-operating expenses

799
6,508
1,811
5,394
14,514

0.2
1.3
0.3
1.0
2.8

1,092
11,107881
4,672
17,753

0.3
2.7
0.2
1.2
4.4

(292)
6,508
(11,107)930
721(3,239)12,052
2,276
10,052
7,140

2.3
0.4
2.0
1.4

8,741
7,704
19,119

2.2
1.9
4.7

3,311
(7,704)
2,276
10,052(11,978)

Non-operating expenses

31,521

6.1

35,5648.8(4,043)

Ordinary loss

(71,901) (13.9)(109,808) (27.0)

37,907

Gain on sale of investment securities
Other special income

37,601
5,185
42,786

7.3
1.0
8.3

127,607
6,797
134,405

31.4
1.6
33.0

(90,006)(1,612)(91,619)

10,585
5,085
9,188

2.0
1.0
1.8

10,84633,84832,323

2.7
8.3
8.0

(261)
(28,763)(23,135)

3,176

0.6

-

-

3,176

19,592
47,6293.8
9.2

19,051
96,071

4.6
23.6

540
(48,441)(71,474) (17.6)(5,269)14,84911,12527,350(2,560)

3.6
2.7
6.7
(0.6)

9,680
(11,125)(36,687)
17,716¥(99,989) (24.6)¥(7,104)

Special income
Loss on sale of investment securities
Valuation loss on investment securities
Valuation loss on investment in affiliates
Extraordinary cost for information security
measures
Other special losses
Special loss
Loss before income taxes and minority
interest(76,744) (14.8)

Income taxes:
Current
RefundedDeferred
Minority interest
Net loss

24,530(9,336)15,156

4.8
(1.8)
2.9

¥(107,094) (20.7)

Note: SOFTBANK CORP. had presented the results of the financing businesses separately in the accounts of "Revenue fromfinancing business" and "Financing business expenses" in the consolidated statements of income. Effective from April 1, 2003,
SOFTBANK CORP. has presented the combined results of operations of non-financial business and financial business in the accountsof "Net sales", "Cost of sales", and "Selling, general and administrative expenses" in the consolidated statements of income.

18

CONSOLIDATED STATEMENTS OF
ADDITIONAL PAID-IN CAPITAL AND RETAINED EARNINGS(Millions of yen; amounts less than one million yen are omitted.)
FY2003
FY2004
April 2002 throughApril 2003 throughMarch 2003
March 2004
ADDITIONAL PAID-IN CAPITAL
Additional paid-in capitalat the beginning of the period
Increase due to issuance of shares
Increase in paid-in capital due tosale of treasury stock
配Additional paid-in capital取at the end of the period¥162,231¥162,231

24,425-32-¥186,690¥162,231(Millions of yen; amounts less than one million yen are omitted.)
FY2003
FY2004
April 2002 throughApril 2003 throughMarch 2003
March 2004RETAINED EARNINGS(ACCUMULATED DEFICITS)
Retained earnings (accumulated deficits)at the beginning of the period
Net loss
Cash dividends
Bonuses to directors
Net adjustments to retained earnings due tochange in scope of the consolidation
Increase due to merger
Decrease due to merger
Accumulated deficits
at the end of the period¥(101,031)¥4,035(107,094)(2,342)(73)(99,989)(2,358)
(75)

(287)

(2,627)

202
-

(17)

¥(210,625)¥(101,031)

Note: Under Japanese GAAP, the cumulative effect arising from any changes in scope of consolidation is treated as an
adjustment to retained earnings in the consolidated statements of additional paid-in capital and retained earnings.

19

CONSOLIDATED STATEMENTS OF CASH FLOWS(Millions of yen; amounts less than one million yen are omitted.)
FY2003
FY2004
April 2003 throughMarch 2004

April 2002 throughMarch 2003¥(76,744)¥(71,474)

Depreciation and amortization

32,86420,904Equity in loss (gain) under the equity method, net

2,276(11,107)

Valuation loss on investment securities

14,274

66,172Gain on sale of marketable and investment securities, net(27,032)(116,839)

Exchange (gain) loss, net
Interest and dividend income
Interest expense
Increase in receivables- trade(Decrease) increase in payables-trade(Increase) decrease in other receivables
Increase in other payables
Others, net(5,366)(1,323)
12,052(25,023)(9,531)(75,485)
73,831
24,015(61,194)

8,626(1,311)
8,741(3,522)
3,172
8,576
2,208
32,792(53,061)Interest and dividends received
Interest paid
Income taxes paid
Refund of income taxes
Net cash used in operating activities

978(11,206)(16,174)
3,767(83,829)

1,138(9,386)(13,202)
5,911(68,600)

I Cash flows from operating activities:
Loss before income taxes and minority interest

Adjustments to reconcile loss before income taxes and minority
interest to net cash used in operating activities:- Continued -20

CONSOLIDATED STATEMENTS OF CASH FLOWS (Continued)(Millions of yen; amounts less than one million yen are omitted.)
FY2003
FY2004
April 2003 throughMarch 2004

April 2002 throughMarch 2003

II Cash flows from investing activities:
Purchase of property and equipment and intangibles(61,472)(64,500)

Purchase of marketable and investment securities(38,945)(33,413)

Proceeds from sale of marketable and investment
securities

151,136

171,350

Additional investments in newly consolidated entities

1,693

(591)

Sale of interests in subsidiaries previously consolidated(1,167)(23)

Proceeds from sale of interests in consolidated
subsidiaries
Increase in loan receivables
Collection of loans
Others, net
Net cash provided by investing activities

29,21256,356(23,028)
22,577
1,871
81,878(5,211)
1,975(6,191)
119,749

III Cash flows from financing activities:
Proceeds from issuance of shares to minority shareholders(Decrease) increase in short-term borrowings, net
Proceeds from issuance of commercial paper
Redemption of commercial paper
Proceeds from long-term debt
Repayment of long-term debt
Proceeds from issuance of bonds
Redemption of bonds
Proceeds from issuance of shares
Cash dividends paid
Cash dividends paid to minority shareholders
Others, net
Net cash provided by (used in) financing activities

3,704(76,851)
77,500(70,500)
204,828(50,993)
216,636(56,870)
48,631(2,317)(112)
12,735306,390

4,842
44,10414,000(20,000)
1,380(7,758)2,496(52,223)(2,354)(122)(1,980)(17,615)

IV Effect of exchange rate changes
V Net increase in cash and cash equivalents
VI Increase in cash and cash equivalents due to thecompanies newly consolidated
VII Decrease in cash and cash equivalents due to exclusionof the entities previously consolidated
VIII Cash and cash equivalents at the beginning of the period(13,459)
290,980(5,728)27,805-60(1,373)(194)

147,526

119,855

IX Cash and cash equivalents at the end of the period¥437,132¥147,526

21

Condensed quarterly financial information
Condensed Statement of Income

Net sales
Cost of sales
Gross profit
Selling, general andadministrative expenses
Operating loss
Non-operating income
Non-operating expenses
Ordinary loss
Special income
Special loss
Loss before income taxes andminority interest
Income taxes:
Current
Deferred
Minority interest
Net loss(Millions of yen; amounts less than one million yen are omitted.)
Third quarter
Second quarter
First quarter
Fourth quarter(July 1, 2003 to(April 1, 2003 to(January 1, 2004 to (October 1, 2003 to
March 31, 2004) December 31, 2003) September 30, 2003) June 30, 2003)
AmountAmountAmountAmount¥136,699¥121,572¥103,881¥155,239
97,53592,526
83,824
110,137
29,046
20,057
39,164
45,101
53,98645,81644,20544,255(8,884)4,004
4,746(9,626)
19,776
11,047(6,652)
4,327
6,304(8,630)
2,830
4,894

(15,159)
3,042
10,895(23,011)
7,815
25,020(24,197)
3,139
9,575
(30,633)
12,362
6,667

(896)

(10,693)(40,215)(24,938)

10,723(4,854)
6,645¥(13,410)

777
248
4,624
¥(16,344)

3,668(4,009)2,729¥(42,603)

9,360
(721)
1,156
¥(34,734)- Continued -22Condensed Statement of Cash Flows(Millions of yen; amounts less than one million yen are omitted.)
Third quarter
Second quarter
First quarter
Fourth quarter(April 1, 2003 to(January 1, 2004 to (October 1, 2003 to (July 1, 2003 to
March 31, 2004) December 31, 2003) September 30, 2003) June 30, 2003)
AmountAmountAmountAmountI

Net cash used in operating
activities
II
Net cash provided by (used in)investing activities
III Net cash provided by (used in)financing activities
IV Effect of exchange rate changes
V
Net increase (decrease) in cash andcash equivalents
VI Decrease in cash and cash
equivalents due to exclusion of
the entities previously
consolidated
VII Cash and cash equivalents at the
beginning of the period
VIII Cash and cash equivalents at theend of the period
Note: Depreciation and amortization included
in net cash used in operating activities¥(11,381)¥(18,769)¥(15,856)¥(37,821)

20,092(3,273)

72,959(7,899)134,152(14,080)

160,231451(10,785)(44)

22,791
213

128,783

138,640

46,273(22,716)

(25)

(0)

(1,198)(149)

308,374

169,734

124,660

147,526¥437,132¥308,374¥169,734¥124,660¥8,996¥8,151¥8,129¥7,58723

Basis of Presentation of Consolidated Financial Statements
1. Changes in scope of consolidation(1) As of March 31, 2004, SOFTBANK CORP．
（the "Company"）consolidated 177 subsidiaries. 15 subsidiaries were
not consolidated due to their immateriality in terms of the consolidated total assets, sales and revenues, net income andretained earnings of the SOFTBANK consolidated financial statements.
Main changes in the scope of the consolidation for the year ended March 31, 2004 were as follows:<Increase>
1. WORLD NICHIEI FRONTIER Securities Co., Ltd.
(Former WORLD NICHIEI Securities Co., Ltd.)
2. Indival, Inc.
3. Tao Bao Holding Limited

Newly invested
Newly established
Newly invested

Other 16 companies<Decrease>
1. E*TRADE Japan K.K.
2. SOFTBANK FRONTIER SECURITIES CO., LTD.
3. SOFTBANK INVESTMENT INTERNATIONAL(STRATEGIC) LIMITED and its 79 subsidiaries

MergerMergerSale of all shares

Other 29 companies(2) As of March 31, 2004, the Company held 6 non-consolidated subsidiaries and 97 affiliates, all of which were
accounted for under the equity method.
Main changes in application of the equity method for the year ended March 31, 2004 were as follows;<Decrease>
1. Aozora Bank, Ltd.
2. UTStarcom, Inc.

Sale of all shares
Partial sale of shares

Other 17 companies

2. Fiscal year end
Fiscal year ends of consolidated subsidiaries in terms of domestic and overseas are as follows:<Fiscal year end>
March end
(as same as the consolidated B/S date)June end
September end
December end
January end
February end<Domestic>
93
1
4
15
1
2

24

<Overseas>
32
2
27
-

3. Summary of significant accounting policies[1] Evaluation standards and methods for major assets(1) Marketable securities and investment securities
Held-to-maturity debt securities: Stated at amortized cost
Other securities:
With market quotations:
Stated at fair value, which represents the market prices at the balance sheet date (Unrealized gain/loss areincluded as a separate component in shareholders' equity, net of tax, while cost is primarily determined using
the moving-average method)
Without market quotations:

Carried at cost, primarily based on the moving-average method(2) Derivative instruments:

Stated at fair value(3) Inventories:

Carried at cost, primarily based on the moving-average method[2] Depreciation and amortization(1) Property and equipment:
Transmission equipment:

Computed using the straight-line method

Others:Computed primarily using the declining-balance method(2) Intangible assets:

Computed using the straight-line method[3] Accounting principles for major allowances and accruals
Allowance for doubtful accounts:
Allowance for doubtful accounts is calculated based on the aggregate amount of estimated credit losses on
doubtful receivables, plus an amount for receivables other than doubtful receivables calculated using historical
write-off experience ratios from certain prior periods.
[4] Translation of foreign currency transactions and accounts
All assets and liabilities in foreign currencies are translated at the foreign exchange rates prevailing at the respectivebalance sheet dates. Exchange gains or losses are charged to the net income when incurred.
The translation of revenues and expenses in the financial statements of foreign consolidated subsidiaries into Japanese
yen is performed by using the average exchange rate for the period. Assets and liabilities are translated using theforeign exchange rates prevailing at the balance sheet dates, and capital stock is translated using the historical rates.
Foreign currency financial statement translation differences are presented as a separate component of "Shareholders'equity", except for the portion pertaining to minority shareholders, which is included in "Minority interest inconsolidated subsidiaries".
[5] Capital lease
Under the Japanese accounting standards, capital leases, as defined therein, other than those whereby the ownershipof the assets is transferred to the lessee at the end of the lease term, are permitted to be accounted for as operatingleases with a footnote disclosure of the estimated acquisition cost, estimated accumulated depreciation and futurelease payments or receipts.
25[6] Accounting for significant hedge transactions(1) Hedge accounting
Unrealized gains and losses, net of tax, on derivative instruments that are qualified as an effective cash flow hedge at aconsolidated subsidiary in the United States of America are reported as a separate component of “Shareholders’equity” in the Company’s consolidated balance sheets. As such, unrealized gains and losses associated with thederivative instruments will be recognized into earnings in the same period during which the hedged assets andliabilities are recognized in earnings.
(2) Derivative instruments for hedging and hedged items
Derivative instruments for hedging:
Prepaid variable share forward contract (the collar transaction)
Hedged asset:
Equity security(3) Hedging policy
The purpose of the collar transaction is to hedge the variability of cash flows associated with the future market price of
the underlying equity security.
[7] Accounting method for consumption taxes
Consumption taxes are accounted for using net-of-tax method.
4. Accounting for business combinations
All assets and liabilities of an acquired entity are revalued at the respective fair market value at the combination date.
5. Amortization of consolidation adjustment"Consolidation adjustment" is amortized on a straight- line basis over reasonably estimated periods, in which economic
benefits are expected to be realized. An immaterial consolidation adjustment is expensed as incurred.
6. Appropriation of retained earnings
The consolidated statement of retained earnings reflects the appropriation of retained earnings approved during the fiscal
year.
7. Scope of cash and cash equivalents in the consolidated statements of cash flows"Cash and cash equivalents" comprises cash on hand, bank deposits withdrawable on demand and highly liquid
investments with initial maturities of three months or less and a low risk of fluctuation in value.

26

NOTES
1. Accumulated depreciation of property and equipment
March 31, 2004
49,426 million yen
2. Number of treasury stock held by the Company and its subsidiaries
March 31, 2004
Held by the Company
common stock
32,730 shares
Held by consolidated
common stock
sharessubsidiaries
Number of shares issued
common stock
351,436,826 shares

March 31, 2003
27,417 million yen

March 31, 2003
24,781 shares
1,558,719

shares336,876,826

shares3. Receivables and payables relating to margin transactions
Receivables and payables relating to margin transactions in securities businesses engaged by certain consolidated
subsidiaries are as follows:
March 31, 2003
March 31, 2004
Receivables related to margin transactions Loans receivable from customers for
42,457 million yen
margin transactions
168,484 million yen
Cash deposits (collateral) for securities
6,389
borrowed from securities companies
12,558
Payables related to margin transactions Loans payable to securities companies
for margin transactions
Proceeds from securities sold for margintransactions

126,721 million yen

27,906 million yen

33,661

16,552

March 31, 2004

March 31, 2003

4. Assets pledged as collateral(1) For future lease liabilities
Assets pledged as collateral:
Notes and accounts receivable - trade
Other current assets

8,727 million yen
36

9,450 million yen
81

Secured liabilities:
Notes and accounts payable - trade

57 million yen

251 million yen

Note: The collateral for the future lease liabilities was provided by mortgaging against the aggregate of the current andfuture receivables due from customers of certain consolidated subsidiaries and a broadcasting company, based onmarketing agreements, etc. The future lease liabilities at the end of periods are as follows:

Future lease liabilities (including the above "Notes
and accounts payable-trade")

27

March 31, 2004

March 31, 2003

33,558 million yen

32,732 million yen

4. Assets pledged as collateral (continued)(2) For short-term borrowings and long-term debt
March 31, 2004

March 31, 2003

Assets pledged as collateral:
Cash and deposits
Notes and accounts receivable - trade
Inventories
Transmission equipment
Property and equipment- others
Investment securities

902 million yen
1,124
544
5,486
1,507
138,064- million yen
1,704
195
55,711

Secured liabilities:
Notes and accounts payable - trade
Short-term borrowings
Accounts payable - other and accrued expenses
Other current liabilities
Long-term debt

592 million yen
13,681
346
118,483- million yen
19,92058
1,350

Notes:
1. In addition, stocks of ¥2,639 million which are deposited by customers as collateral for margin transactions inrelation to sales of securities were pledged as collateral at the fiscal year ended March 31, 2004.
2. At the fiscal year ended March 31, 2003, SOFTBANK America Inc. (“SBA”), a wholly-owned subsidiary of
the Company, pledged and delivered investment securities amounting to ¥55,711 million into a collateral
securities account. SBA was able to release the excess amount over 142.857% of the secured liabilities,
consisting of ¥19,833 million as "Short-term borrowings" and ¥58 million as “Accounts payable - other andaccrued expenses”.
As of March 31, 2003, the fair market value of the pledged and delivered investment securities was ¥63,175
million, of which ¥34,758 million representing the excess amount over the 142.857% of the secured liabilities
was able to be released.
(3) For long-term debt owed by a third party
March 31, 2004

March 31, 2003

Assets pledged as collateral:
Investments in partnerships

1,842 million yen

2,229 million yen

Secured liabilities:
Long-term debt owed by a third party

2,349 million yen

2,388 million yen

5. Cash receipt as collateral
Cash receipt as collateral from financial institutions, to whom the Company lent its subsidiary’s shares under a security
deposit agreement, is presented as follows.
March 31, 2004
Other current liabilities

10,00028

million yen

March 31, 2003-

million yen

6. Reserve required under special laws
Securities Exchange Law, No. 51
Commodity Exchange Act, No. 136-22

Reserve for securities trading liabilities
Reserve for commodity trading liabilities

7. Net unrealized gains/losses on derivative instruments
Statement of Financial Accounting Standards No. 133, “Accounting for Derivative Instruments and Hedging Activities”(“SFAS 133”) is adopted on derivative instruments which the Company’s consolidated subsidiary in the United States ofAmerica utilized.
The consolidated subsidiary in the United States of America has entered into a variable share prepaid forward contract (the“collar transaction”) utilizing its shares of an equity security. The purpose of this collar transaction is to hedge the variabilityof cash flows associated with the future market price of the underlying security, which is used for the settlement of the loans.
According to SFAS 133, unrealized gains and losses, net of tax, on the effective portion of the cash flow hedge as defined arereported as a separate component of “Shareholders’ equity”, until gains and losses on the hedged item are recognized inearnings.

8. Line of credit as a creditor (not used)
March 31, 2004
204
million yen

March 31, 2003
51 million yen

March 31, 2004
6,581
million yen

March 31, 2003
7,466 million yen

9. Balance of accounts receivable sold

10. Research and development costs included in general and administrative expenses and cost of sales
March 31, 2004
1,267
million yen

March 31, 2003
- million yen

11. Valuation loss on investments in subsidiaries and affiliates"Valuation loss on investments in affiliates" presented as a special loss in the consolidated statements of income is asfollows:
I.
Valuation loss on investment in consolidated subsidiaries
March 31, 2003
March 31, 2004
10,610 million yen
7,275
million yen
II.

Valuation loss on investment in affiliates accounted for under the equity method
March 31, 2004
1,913
million yen

29

March 31, 2003
21,713 million yen

12. Consolidated statements of cash flows
Reconciliation of cash and cash equivalents to the amounts presented in the accompanying consolidated balance sheets

Cash and deposits
Marketable securities
Time deposits with original maturity
over three months
Deposits received from customers
in the commodities business
Stocks and bonds with original
maturity over three months
Cash and cash equivalents

March 31, 2004
327,023 million yen
113,659

March 31, 2003
147,503 million yen
5,059(2,331)(2,866)

(75)

(29)

(1,143)(2,140)437,132

30

million yen

147,526 million yen

Significant subsequent events
Zero Coupon Convertible Bonds due 2009 (bonds with stock acquisition rights)(“the Bonds”) offering at theCompany’s subsidiary
The Bonds offering was approved at the board of directors’ meeting of SOFTBANK INVESTMENT CORPORATION, asubsidiary of the Company, on March 22, 2004. The summary below describes the terms and conditions of the Bonds.
(1) Bonds offered:(2) Issued amount:(3) Offered amount:(4) Interest rate:(5) Redemption date:(6) Date of receipt and issuance:(7) Collateral:(8) Conditions of stock acquisition rights:
a. Type of shares:
b. Number of stockacquisition rights:
c. Acquisition price:d. Valid period for exerciseof stock acquisition rights:(9) Offering:

The ¥20,000,000,000 Zero Coupon Convertible Bonds due 2009 (bonds withstock acquisition rights) of SOFTBANK INVESTMENT CORPORATION
20,000 million yen
100% of principal amount
Zero coupons
April 8, 2009 (London time. Fully redemption of issued amounts)
April 8, 2004 (London time)
None

Common stock of SOFTBANK INVESTMENT CORPORATION
2,000
No consideration
Effective from April 22, 2004 to March 18, 2009 (London time)
Private offering in foreign markets mainly in Europe, except for the U.S.

31

Segment information
1. Business Segment Information(Millions of yen; amounts less than one million yen are omitted.)(1) FY2004 (for the year ended March 31, 2004)
Broadband
Infrastructure

e-Commerce

e-Finance

Media &
MarketingBroadmedia

Internet

Technology

Overseas

CultureServices

Funds

OthersTotal

Eliminationor corporate

Consolidated

Net Sales(1)Customers(2)Inter-segment
Total¥128,711¥243,902¥37,949¥13,186¥8,770¥63,613¥14,435¥2,443¥4,382¥517,393¥-¥517,393

195

10,985

3,477

1,221

4,122

441

8,167

-

1,489

30,102(30,102)-

128,906

254,888

41,427

14,407

12,89264,05422,603

2,443

5,871

547,496(30,102)517,393

Operating expenses

216,504

251,241

35,515

15,50016,19831,472

21,867

1,067

9,837

599,205(26,918)572,287

Operating income (loss)¥(87,597)¥3,647¥5,911¥(1,092)¥(3,305)¥32,582¥736¥1,375¥(3,965)¥(51,709)¥(3,184)¥(54,893)

Identifiable assets¥174,814¥74,053¥455,796¥9,628¥16,230¥218,780¥16,212¥76,257¥185,607¥1,227,381¥193,825¥1,421,206

Depreciation and amortization

22,875

1,522

4,320

370

1,309

3,510

202

326

297

34,735(1,189)33,546

Capital expenditures

52,273

1,341

3,246

263

3,145

6,561

210

12

1,378

68,43572

68,507(Millions of yen; amounts less than one million yen are omitted.)(2) FY2003 (for the year ended March 31, 2003)

32

Broadband
Infrastructure

e-Commerce

e-Finance

Media &
MarketingBroadmedia

Internet

Technology

Overseas

CultureServices

Funds

OthersTotal

Elimination or
corporate

Consolidated

Net Sales(1)Customers(2)Inter-segment¥39,945¥250,782¥23,615¥15,916¥10,442¥37,740¥10,912¥3,277¥14,258¥406,892¥-¥406,892

62

15,304

4,551

996

1,502

459

14,815-

1,603

39,296(39,296)-

40,007

266,086

28,167

16,912

11,94438,20025,7283,277

15,862446,188(39,296)406,892

Operating expenses

136,212263,620

33,99017,436

13,56021,31924,615

1,286

22,246534,286(35,397)498,889

Operating income (loss)¥(96,204)¥2,466¥(5,823)¥(523)¥(1,615)¥16,881¥1,113¥1,991¥(6,383)¥(88,098)¥(3,899)¥(91,997)

Identifiable assets

Total¥136,625¥82,518¥221,646¥14,514¥12,442¥124,573¥14,757¥105,752¥140,712¥853,544¥92,787¥946,331

Depreciation and amortization

12,033

1,157

5,752

324

364

2,249

173

444

1,434

23,932229

24,161

Capital expenditures

76,928

4,187

4,427

191

4,442

4,689

365

20

316

95,570(99)

95,470Notes: 1. Business segments are categorized primarily based on the nature of business operations, type of services, and similarity of sales channels, etc., which the SOFTBANK Group uses for its internalmanagement purpose.
2. Please refer to the chart of "The SOFTBANK Group" for main businesses by segments.
3. The amounts of corporate assets included in the column "Elimination or corporate" were ¥111,078 million and ¥223,970 million at the fiscal year ended 2003 and 2004, respectively, which weremainly surplus operating funds (cash and marketable securities), long-term investment securities of the Company and assets held by the corporate division of the Company.
4."Capital expenditures" include acquisition of long-term prepaid expenses and deferred assets. "Depreciation and amortization" includes amortization of the long-term prepaid expenses and deferredcharges.

2.Geographic Segment Information(1) FY2004 (for the year ended March 31, 2004)(Millions of yen; amounts less than one million yen are omitted.)
Elimination
North
Japan
Others
Total
ConsolidatedorAmerica
corporate
Net Sales(1)Customers¥509,676¥2,194¥5,523 ¥517,393¥¥517,393(2)Inter-segment
522
56
107
686
(686)
Total
510,198
2,250
5,631
518,080(686)
517,393
Operating expenses
558,6803,506
7,506
569,6932,594
572,287
Operating loss¥(48,481) ¥(1,255)¥(1,874) ¥(51,612)¥(3,281)¥(54,893)
Identifiable Assets¥804,977 ¥334,678¥69,367 ¥1,209,023¥212,182¥1,421,206(2) FY2003 (for the year ended March 31, 2003)

Japan

North
America(Millions of yen; amounts less than one million yen are omitted.)
Elimination
Consolidated
EuropeKorea
OthersTotalor
corporate

Net Sales(1)Customers(2)Inter-segment
Total
Operating expenses
Operating loss

¥386,477
555
387,033
469,288¥(82,255)¥2,992
872
3,864
4,482
¥(617)

¥160
160
734
¥(573)¥13,973
13,973
16,790¥(2,817)¥3,448
26
3,475
5,283
¥(1,807)¥406,892
1,615
408,507496,578¥(88,071)¥(1,615)(1,615)2,310¥(3,925)¥406,892
406,892
498,889¥(91,997)

Identifiable Assets¥617,742¥131,911¥46,994¥20,816¥18,648¥836,112¥110,218¥946,331

Notes:
1. Net sales by geographic region were recognized based on geographic location.
Significant countries in each region are shown below:
North America: U.S.A. and Canada
Others: Europe, Korea, China, Hong Kong and Singapore
2. The amounts of corporate assets included in the column "Elimination or corporate" were ¥111,078 million and ¥223,970 million
at the fiscal year ended 2003 and 2004, respectively, which were mainly surplus operating funds (cash and marketable securities) andlong-term investment securities of the Company, and assets held by the corporate division of the Company.
3. Due to the decrease in materiality of the results of “Europe” and “Korea”, the SOFTBANK Group combined the results of“Europe” and “Korea” into “Others” effective from April 1,2003.

3. Overseas Sales
Overseas sales for the year ended March 31, 2004 were omitted because the total overseas sales were less than 10% of total
consolidated sales.

33

LEASES
1. Capital leases in which the ownership of leased assets is not transferred to lessees at the end of lease periods(as a lessee)(1) Amounts equivalent to acquisition costs, accumulated depreciation and net book value at the end of the periods
March 31, 2003
March 31, 2004
Property and equipment
Equivalent to acquisition costs
52,31160,289Less: amount equivalent to accumulated
depreciation(17,328)(22,578)
Net book value
34,982 million yen
37,711 million yen
Software (intangible assets)
Equivalent to acquisition costs
Less: amount equivalent to accumulated
amortization
Net book value

928

1,105

(187)
741 million yen(261)
844 million yen

61,21853,417(22,766)
38,452 million yen(17,589)
35,827 million yen(2) The future lease payments for capital lease at the end of the periods
March 31, 2004
Due within one year
15,154Due after one year
27,901
Total
43,056 million yen

March 31, 2003
12,43425,70838,143 million yen(3) Lease payments, amounts equivalent to depreciation and interest expense
FY2004
April 2003 throughMarch 2004
Lease payments
15,836 million yen
Amount equivalent to depreciation expense
13,747
Amount equivalent to interest expense
2,408

FY2003
April 2002 throughMarch 2003
12,021 million yen
10,062
2,142

Total
Equivalent to acquisition costs
Less: amount equivalent to accumulated
depreciation
Net book value(4) Calculation method of amount equivalent to depreciation and interest expense
The amount equivalent to depreciation is computed using the straight-line method over the period of the capital leases,
assuming no residual value except in cases where the residual value is guaranteed in the lease contract.
The amount equivalent to interest expense, which is calculated by subtracting acquisition costs from total lease
payments, is allocated over the lease periods based on the interest method.

34

1.

Capital leases in which the ownership of leased assets is not transferred to lessees at the end of lease periods(continued)(as a lessor)(1) Acquisition costs, accumulated depreciation and net book value at the end of the periods
March 31, 2003
March 31, 2004
Property and equipment
Acquisition costs
613
617
Less: accumulated depreciation
(262)
(284)
350 million yen
Net book value
332 million yen
Software (intangible assets)
Acquisition costs
Less: accumulated amortization
Net book value

168
(38)
129

Total
Acquisition costs
Less: accumulated depreciation
Net book value

million yen

295
(141)
154

million yen

785
(323)
461 million yen

909
(404)
504

million yen(2) The future lease receivables for capital leases at the end of the periods
March 31, 2004
Due within one year176
Due after one year
307
Total
483 million yen(3) Lease income, depreciation and amount equivalent to interest income
FY2004
April 2003 throughMarch 2004
Lease income
Depreciation expense
Amount equivalent to interest income

156 million yen
134
23

March 31, 2003
188
348
536 million yen

FY2003
April 2002 throughMarch 2003
333 million yen
28663(4) Calculation method of amount equivalent to interest income
The amount equivalent to interest income, which is calculated by subtracting acquisition costs from total of lease income andestimated residual value, is allocated over the lease periods based on the interest method.

2. Non-cancelable operating lease transactions(as a lessee)
The future lease payments for non-cancelable operating lease
March 31, 2004
599
285
884 million yen

Due within one year
Due after one year
Total
(as a lessor)
No transaction applicable.

35

March 31, 2003
210
240
451 million yen

RELATED PARTY TRANSACTIONS
1. Parent Company and Major Corporate Shareholders
N/A
2. Directors and Major Individual Shareholders
N/A
3. Subsidiaries
N/A
4. Affiliates
N/A

36

Tax effect accounting
FY2003 (For the year ended March 31, 2003)

FY2004 (For the year ended March 31, 2004)

1. Significant components of deferred tax assets and liabilities 1. Significant components of deferred tax assets and liabilities(Million yen)
(Million yen)
Deferred tax assets
Deferred tax assets
Loss carry-forwards¥116,452
Loss carry-forwards¥143,906
Valuation loss on investment securities
66,015
Valuation loss on investment securities
64,791
Allowances for doubtful accounts
4,480
Allowances for doubtful accounts
7,407
Unrealized profit
3,656
Valuation loss on inventories
6,000
Depreciation/Amortization
1,519
Net unrealized loss on derivative instruments
4,940
Enterprise tax payable
1,029
Unrealized profit
3,157
Others3,573Enterprise tax payable
1,807
Gross deferred tax assets
196,726
Depreciation/Amortization
1,623
Less: valuation allowance(141,061)
Others5,604
Total deferred tax assets
55,664Gross deferred tax assets
239,239
Less: valuation allowance(191,220)
Total deferred tax assets
48,019Deferred tax liabilities
Unrealized gains on other securities
Valuation gain on investment securities
Exchange gains on long-term receivables
OthersTotal deferred tax liabilities
Net amount of deferred tax liabilities(57,891)(4,764)(4,323)(4,927)(71,906)¥(23,887)

2. Reconciliation between the statutory income tax rate andeffective income tax rate:
Statutory tax rate
(Reconciliation)
Change in valuation allowance
Tax rate differential
Change in statutory tax rate
Differences related to investments in affiliates
OthersIncome tax rate per statement of income

Deferred tax liabilities
Unrealized gains on other securities
Valuation gain on investment securities
Exchange gains on long-term receivables
OthersTotal deferred tax liabilities
Net amount of deferred tax assets(30,870)(22,897)
(742)
(680)
(55,191)¥473

2. Reconciliation between the statutory income tax rate andeffective income tax rate:

42.05% Statutory tax rate
(Reconciliation)(55.54)% Differences related to investments in affiliates
Change in valuation allowance(2.81)Tax rate differential(2.79)
Change in statutory tax rate
(1.36)
Others0.65
Income tax rate per statement of income(19.80)%42.05%
10.01%(86.90)(6.95)(1.43)(0.26)(43.48)%3. Due to an amendment to the local tax law, effective from the fiscal year
beginning April 1, 2004, the statutory tax rate used for the calculation ofdeferred tax assets and liabilities has been changed.
The Company has therefore applied the statutory tax rate prior to theamendment to temporary differences which will be resolved on or before
March 31, 2004 and has applied the new rate to those which will be
resolved on or after April 1, 2004.
Due to the change in the statutory tax rate, "Deferred tax assets", net of"Deferred tax liabilities", at March 31, 2003 decreased by ¥1,013
million, and "Income taxes-deferred" for the year ended March 31, 2003
increased by ¥1,022 million, as compared with the amounts which
would have been calculated if the tax rate prior to the amendment had
been applied consistently to all temporary differences.

37

INVESTMENT IN DEBT AND EQUITY SECURITIESFY2004 (as of March 31, 2004)
1. Trading securities(Millions of yen; amounts less than one million yen are omitted.)
March 31, 2004
Carrying amount
AssetsLiabilities
1.
2.

Equity securities
Debt securities
Total

¥21
1,285
¥1,307¥4¥4

2. Non-trading securities(1) Available-for-sale and other securities at fair value(Millions of yen; amounts less than one million yen are omitted.)
FY2004 (as of March 31, 2004)
Investment Cost Carrying Amount Differences
Carrying Amount > Investment Cost
(1)Equity securities¥37,027¥205,128¥168,100(2)Debt securities: Government bonds
100
100
0
(3)Others
278
321
42
Sub-total
37,406
205,550
168,143
Carrying Amount≦Investment Cost
(1)Equity securities(2)Debt securities: Corporate bonds(3)Others
Sub-total
Total

1,545
5,281
100
6,927
¥44,333

1,477
5,265
91
6,834
¥212,384

(68)
(16)
(8)
(93)
¥168,050(2) Available-for-sale and other securities sold during the year ended March 31, 2004
(Millions of yen; amounts less than one million yen are omitted.)
Sales Price
Gain on sales
Loss on sales(1) Equity securities¥28,319¥12,080¥97(2) Debt securities
807250(3) Others
7,397
68
56
Total
¥36,524¥12,174¥153(3) The carrying amounts of the unlisted investment securities(Millions of yen; amounts less than one million yen are omitted.)
Carrying Amounts
Available-for-sale and other securities
Unlisted equity securities (w/o OTC stocks)
Unlisted foreign debt securities
Preferred fund certificate
Mid-term government bond funds
MMF
Designated Money Trust
Investment trust without market quotations
OthersTotal¥19,237
1,081
2,000
261
3,272
5,000
106,427
0¥137,279

38

INVESTMENT IN DEBT AND EQUITY SECURITIES (Continued)(4) Redemption schedule for "held-to-maturity securities" and "available-for-sale and other securities" with maturity
date subsequent to the consolidated balance sheet date(Millions of yen; amounts less than one million yen are omitted.)
More than fiveMore than one
More than ten
Within one year
years,
year,
years
less than five years less than ten years
Available-for-sale and othersecurities
Debt securities
Government bonds¥¥102¥¥Corporate bonds
5,471
Others871
Total¥¥5,574¥871¥-

FY2003 (as of March 31, 2003)
Non-trading securities(1) Available-for-sale and other securities at fair value(Millions of yen; amounts less than one million yen are omitted.)
FY2003 (as of March 31, 2003)
Investment Cost
Carrying Amount
Differences
Carrying Amount > Investment Cost
(1) Equity securities(2) Debt securities: Government bonds(3) Others
Sub-total¥16,3129
0
16,322¥78,934
9
0
78,944¥62,6210062,622

7,094
100
469
7,664
¥23,987

4,444
100
297
4,842
¥83,787(2,649)(0)(172)(2,822)¥59,800

Carrying Amount≦Investment Cost
(1) Equity securities(2) Debt securities: Government bonds(3) Others
Sub-total
Total(2) Available-for-sale and other securities sold during the year ended March 31, 2003
(Millions of yen; amounts less than one million yen are omitted.)
Sales Price
Gain on sales
Loss on sales(1) Equity securities¥122,598¥65,163¥(10,348)(2) Debt securities
5,610
1,726
(173)
(3) Others
100
Total
¥128,309¥66,889¥(10,521)

39

(3) The carrying amounts of the unlisted investment securities(Millions of yen; amounts less than one million yen are omitted.)
Carrying Amounts(1) Held-to-maturity securities
Unlisted debt securities¥0
Unlisted foreign debt securities
199(2) Available-for-sale and other securities
Unlisted equity securities (w/o OTC stocks)
19,109Unlisted debt securities
250
Unlisted foreign debt securities
1,724
MMF
4,370
Mid-term government bond funds
320
Commercial paper
1,999
Preferred fund certificate
2,000
Others605
Total¥30,580(4) Redemption schedule for "held-to-maturity securities" and "available-for-sale and other securities" with maturity date
subsequent to the consolidated balance sheet date(Millions of yen; amounts less than one million yen are omitted.)
More than fiveMore than one year,
More than ten years
Within one year
years,
less than five years
less than ten years
Held-to-maturity securities
Corporate bonds¥199¥¥¥Sub-total
199
Available-for-sale and other securities
Debt securities
Government bonds
110
Corporate bonds
818
192
Others
1,999
1,006
Sub-total
1,999
928
192
1,006
Total
¥2,199¥928¥192¥1,00640

PENSION AND SEVERANCE PLANS
1.

Pension Plans
Starting on July 1, 2002, the Company and most of its domestic consolidated subsidiaries transferred their non-contributory
defined benefit pension plans to the defined contribution pension plans. To supplement these defined contribution plans, theCompany and most of its domestic consolidated subsidiaries participate in a multi-employer contributory defined benefit welfare
pension plan.

2.

Projected Benefit Obligation
Projected benefit obligation (PBO)
Plan assets at fair value
Unfunded PBO
Unrecognized actuarial losses
Net liability for retirement benefits
Prepaid pension costs
Accrued retirement benefits

3.

As of March 31, 2004
2,086 million yen
1,880
206
194
11
22
34 million yen

As of March 31, 2003
131 million yen
81
49
49
49 million yen

As of March 31, 2004
626 million yen
20
17
49
367
1,047 million yen

As of March 31, 2003
531 million yen
9
5
4
160
297
996 million yen

Pension and Severance Costsa) Service costs(notes 1and 2)b) Interest costsc) Expected return on plan assetsd) Recognized actuarial lossese) Contributionsf) Losses on transfer of pension plansg) Net pension and severance costs

Notes:
1. The service cost includes the contribution to multi-employer contributory defined benefit welfare pension plan.
2. The service cost includes the pension costs of subsidiaries adopting the simplified pension accounting method.
Per share data
FY2003

FY2004
Net loss per share - primary (yen)Net loss per share - diluted (note 1)
Shareholders’ equity per share (yen)Basic data for computation of the per share data
1.Average number of common stock outstanding
during each fiscal period (unit: shares) (note 2)
2.Net loss (in millions of yen)
3.Net loss allocated to common stock outstanding(in millions of yen)
4.Net loss not allocated to common stock holders(in millions of yen) (note 3)
Notes:
1. Diluted net income per share is not disclosed due to the loss position.
2. There were no common stock equivalents at each period end.
3. The primary component is "Bonuses to Directors".

43¥(314.72)
677.40¥(296.94)
767.56

340,407,372

336,857,133¥(107,094)¥(99,989)¥(107,133)¥(100,027)¥39¥38