Form 6-K
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D. C. 20549
FORM 6-K
REPORT OF FOREIGN PRIVATE ISSUER
Pursuant to Rule 13a-16 or 15d-16 of
the Securities Exchange Act of 1934
For the month of April 2006
Commission File Number: 001-06439
SONY CORPORATION
(Translation of registrant's name into English)
7-35 KITASHINAGAWA 6-CHOME, SHINAGAWA-KU, TOKYO, JAPAN
(Address of principal executive offices)
The registrant files annual reports under cover of Form 20-F.
Indicate by check mark whether the registrant files or will file annual reports
under cover of Form 20-F or Form 40-F,
Form 20-F X Form 40-F __
Indicate by check mark whether the registrant by furnishing the information
contained in this Form is also thereby furnishing the information to the
Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934,
Yes No X
If "Yes" is marked, indicate below the file number assigned to the registrant in
connection with Rule 12g3-2(b):82-______
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
SONY CORPORATION
(Registrant)
By: /s/ Nobuyuki Oneda
(Signature)
Nobuyuki Oneda
Executive Vice President and
Chief Financial Officer
Date: April 27, 2006
List of materials
Documents attached hereto:
i) Press release announcing Sony's Consolidated Financial Results for the
Fiscal Year Ended March 31, 2006
Sony Corporation
6-7-35 Kitashinagawa,
Shinagawa ku
Tokyo 141-0001 Japan
No: 06-035E
3:00 P.M. JST, April 27, 2006
Consolidated Financial Results
for the Fiscal Year Ended March 31, 2006
Tokyo, April 27, 2006 -- Sony Corporation today announced its
consolidated results for the fiscal year ended March 31, 2006 (April
1, 2005 to March 31, 2006).
(Billions of yen, millions of U.S. dollars, except per share
amounts)
Fiscal Year ended March 31
2005 2006 Change 2006*
in Yen
---------------- ------ ------ ------ ------
Sales and operating Y7,159.6 Y7,475.4 +4.4% $63,893
revenue
Operating income 113.9 191.3 +67.9 1,635
Income before income 157.2 286.3 +82.1 2,447
taxes
Equity in net income 29.0 13.2 -54.6 113
of affiliated companies
Net income 163.8 123.6 -24.5 1,057
Net income per share
of common stock
- Basic Y175.90 122.58 -30.3% $1.05
- Diluted 158.07 116.88 -26.1 1.00
* U.S. dollar amounts have been translated from yen, for convenience
only, at the rate of Y117=U.S.$1, the approximate Tokyo foreign
exchange market rate as of March 31, 2006.
Unless otherwise specified, all amounts are on the basis of Generally
Accepted Accounting Principles in the U.S. ("U.S. GAAP").
Consolidated Results for the Fiscal Year Ended March 31, 2006
-------------------------------------------------------------
Sales and operating revenue ("sales") increased 4.4% compared
with the previous fiscal year; on a local currency basis sales
increased slightly. (For all references herein to results on a
local currency basis, see Note I.)
Sales within the Electronics segment increased 1.7% (a 3%
decrease on a local currency basis). Although there was a
decrease in sales particularly of CRT and plasma televisions,
sales of LCD and LCD rear projection televisions increased. In
the Game segment, sales increased by 31.4% primarily as the
result of the contribution from PSP(R) (PlayStation(R) Portable)
("PSP"). Sales in the Pictures segment increased 1.7% compared
with the previous fiscal year (a 4% decrease on a U.S. dollar
basis). In the Financial Services segment, revenue increased by
32.6% compared to the previous fiscal year mainly due to an
improvement in gains and losses on investments at Sony Life
Insurance Co., Ltd. ("Sony Life").
Operating income increased 67.9% (a 23% increase on a local
currency basis) compared with the previous fiscal year. This
includes a one time net gain of Y73.5 billion ($628 million),
which resulted from the transfer to the Japanese Government of
the substitutional portion of Sony's Employee Pension Fund. Of
this, a gain of Y64.5 billion ($551 million) was recorded within
the Electronics segment. In addition, restructuring charges,
which were recorded as operating expenses, amounted to Y138.7
billion ($1,185 million) compared to Y90.0 billion in the
previous fiscal year. In the Electronics segment, restructuring
charges were Y125.8 billion ($1,075 million) compared to Y83.2
billion the previous fiscal year.
In the Electronics segment, although there was a decrease in
sales to outside customers, an increase in loss on sale,
disposal or impairment of assets and a deterioration in the cost
of sales ratio associated with a decline in unit selling prices,
the amount of operating loss decreased as a result of a gain
resulting from the abovementioned transfer to the Japanese
Government of the substitutional portion of Sony's Employee
Pension Fund and the depreciation of the yen. In the Game
segment, there was a significant decline in operating income
primarily resulting from an increase in research and development
costs associated with PLAYSTATION(R) 3 ("PS3"). In the Pictures
segment, operating income decreased significantly primarily due
to lower worldwide theatrical and home entertainment revenues on
feature films. In the Financial Services segment, there was a
significant increase in operating income mainly attributable to
the increase in gains on investments at Sony Life.
Income before income taxes increased 82.1% compared to the
previous fiscal year. There was an improvement in the net effect
of other income and expenses compared to the previous fiscal
year primarily due to the recording of a gain on change in
interest of Y60.8 billion ($520 million), compared to the Y16.3
billion recorded in the previous fiscal year. During the fiscal
year, Sony recorded a gain of Y21.5 billion ($184 million) on
the change in interest in subsidiaries and equity investees
resulting from the initial public offering of Sony Communication
Network Corporation ("SCN"), a gain of Y20.6 billion ($176
million) on the change in interest resulting from the sale of a
portion of stock in Monex Beans Holdings, Inc., and gains of
Y12.0 billion ($103 million) and Y6.6 billion ($56 million)
respectively on the change of interest at So-net M3 Inc., a
consolidated subsidiary of Sony Communications Network
Corporation ("SCN") and at DeNA Co., Ltd., an equity affiliate
of SCN accounted for by the equity method.
Income taxes: Compared to an effective tax rate of 10.2% in the
previous fiscal year, the effective tax rate was 61.6% in the
current fiscal year. This effective tax rate exceeded the
Japanese statutory tax rate primarily due to the recording of
additional valuation allowances against deferred tax assets by
Sony Corporation and several of Sony's domestic and overseas
consolidated subsidiaries due to continued losses recorded at
these businesses and the recording of an additional tax
provision for the undistributed earnings of foreign
subsidiaries. The effective tax rate was significantly lower
than the Japanese statutory rate in the previous fiscal year as
a result of the reversal of valuation allowances at Sony's U.S.
subsidiaries associated with an improvement in operating
performance.
Equity in net income of affiliated companies decreased by 54.6%
compared to the previous fiscal year. Equity in net income of
affiliated companies for the previous fiscal year included the
recording of Y12.6 billion as equity in net income for
InterTrust Technologies Corporation. This amount reflected
InterTrust's proceeds from a license agreement arising from the
settlement of a patent-related suit. In the current fiscal year,
Sony Ericsson Mobile Communications AB ("Sony Ericsson")
contributed Y29.0 billion ($248 million) to equity in net
income, an increase of Y11.6 billion compared to the previous
fiscal year. Sony recorded equity income of Y5.8 billion ($50
million) for SONY BMG MUSIC ENTERTAINMENT ("SONY BMG"), compared
to an equity loss of Y3.4 billion in the previous fiscal year.
However, Sony recorded an equity in net loss of Y7.2 billion
($61 million) for S-LCD Corporation ("S-LCD"), a joint-venture
with Samsung Electronics Co., Ltd. for the manufacture of
amorphous TFT LCD panels and equity in net loss of Y16.9 billion
($144 million) for Metro-Goldwyn-Mayer Inc. ("MGM")*. The equity
in net loss for MGM includes non-cash interest of Y6.0 billion
($51 million) on cumulative preferred stock.
* On April 8, 2005, a consortium led by Sony Corporation of America
and its equity partners completed the acquisition of MGM. As part
of the acquisition, Sony invested $257 million in exchange for 20%
of the total equity. However, based on the percentage of common
stock owned, Sony records 45% of MGM's net income (loss) as equity
in net income (loss) of affiliated companies.
Net income, as a result, decreased 24.5% compared to the
previous fiscal year.
Operating Performance Highlights by Business Segment
----------------------------------------------------
Note: As of August 1, 2004, Sony and Bertelsmann AG combined
their recorded music businesses in a joint venture. The newly
formed company, SONY BMG, is 50% owned by each parent company.
Under U.S. GAAP, SONY BMG is accounted for by Sony using the
equity method and, since August 1, 2004, 50% of net profits or
losses of this business have been included under "Equity in net
income (loss) of affiliated companies."
In connection with the establishment of this joint venture,
Sony's non-Japan based disc manufacturing and physical
distribution businesses, formerly included within the Music
segment, have been reclassified to the Electronics segment to
recognize the new management reporting structure whereby Sony's
Electronics segment has now assumed responsibility for these
businesses. Effective April 1, 2005, a similar change was made
with respect to Sony's Japan based disc manufacturing business.
Results for the three month period and fiscal year ended March
31, 2005 in the Electronics segment have been restated to
account for these reclassifications.
Effective April 1, 2005, Sony no longer breaks out its music
business as a reportable segment as it no longer meets the
materiality threshold. Accordingly, the results for Sony's music
business are now included within All Other and the results for
the three month period and fiscal year ended March 31, 2005 have
been reclassified to All Other for comparative purposes. Results
for the three month period and fiscal year ended March 31, 2006
in All Other include the results of Sony Music Entertainment
Inc.'s ("SMEI") music publishing business and Sony Music
Entertainment (Japan) Inc. ("SMEJ"), excluding Sony's Japan
based disc manufacturing business which, as noted above, has
been reclassified to the Electronics segment. However, results
for the same periods of the previous fiscal year in All Other
include the consolidated results for SMEI's recorded music
business for the period through August 1, 2004, as well as the
results for SMEI's music publishing business and SMEJ excluding
Sony's Japan based disc manufacturing business.
Electronics
----------- (Billions of yen, millions of U.S. dollars)
Fiscal Year ended March 31
2005 2006 Change 2006
in Yen
------------------- ------ ------ ------ ------
Sales and operating Y5,066.8 Y5,150.5 +1.7% $44,021
revenue
Operating loss (34.3) (30.9) - (264)
Unless otherwise specified, all amounts are on a U.S. GAAP basis.
Sales increased by 1.7% compared to the previous fiscal year (a
3% decrease on a local currency basis). Sales to outside
customers decreased 0.9% compared to the previous fiscal year.
There was a decline in sales of CRT televisions, due to a
continued shift in demand towards flat panel televisions, and
plasma televisions, where new product development has been
terminated. However, there was an increase in sales of LCD
televisions, including the new BRAVIA TM models, which saw
increased sales in all geographic areas, and LCD rear projection
televisions, which saw increased sales particularly in the U.S.
Operating loss declined by Y3.3 billion compared with the
previous fiscal year. Despite a decline in sales to outside
customers, an increase in loss on sale, disposal or impairment
of fixed assets, and a deterioration in the cost of sales ratio
as a result of a decline in unit selling prices, the amount of
operating loss decreased as a result of the Y64.5 billion ($551
million) net gain resulting from the transfer to the Japanese
Government of the substitutional portion of Sony's Employee
Pension Fund, as well as favorable exchange rates. With regard
to products within the Electronics segment, there was an
increase in operating income for such products as "Handycam(R)"
video cameras, which experienced an increase in sales of DVD and
high definition video cameras, and "VAIO" PCs, where favorable
sales of notebook PC were recorded. On the other hand, there was
a deterioration in the profitability of CRT televisions, where
sales decreased, as well as in that of Image Sensors and LCD
televisions, which both experienced a decline in unit selling
prices.
Inventory, as of March 31, 2006, was Y665.7 billion ($5,690
million), a Y151.3 billion, or 29.4%, increase compared with the
level as of March 31, 2005 and a Y66.9 billion, or 11.2%,
increase compared with the level as of December 31, 2005. This
increase was primarily a result of increased semiconductor
inventory in preparation for the PS3 launch and increased LCD
television inventory in preparation for the launch of new
models.
Operating Results for Sony Ericsson Mobile Communications AB
------------------------------------------------------------
The following operating results for Sony Ericsson, which is
accounted for by the equity method, are not consolidated in
Sony's consolidated financial statements. However, Sony believes
that this disclosure provides additional useful analytical
information to investors regarding operating performance. In
addition, please note that the operating results of Sony
Ericsson discussed below are reported on an International
Financial Reporting Standards basis, and thereby differ from the
operating results reported on a U.S. GAAP basis contained within
Sony's equity in net income (loss) of affiliated companies.
Sony Ericsson recorded sales for the one year period ended March
31, 2006 of Euro 7,972 million, a Euro 1,497 million or 23%
increase compared to the same period of the previous year.
Income before taxes was Euro 595 million, a Euro 135 million
increase compared to the same period of the previous year, and
net income of Euro 433 million was recorded, a Euro 166 million
increase compared to the same period of the previous year.
Results were boosted by sales of hit models such as camera
phones and "Walkman(R)" phones. As a result, equity in net
income of Y29.0 billion ($248 million) was recorded by Sony.
Game
---- (Billions of yen, millions of U.S. dollars)
Fiscal Year ended March 31
2005 2006 Change 2006
in Yen
------------------- ------ ------ ------ ------
Sales and operating Y729.8 Y958.6 +31.4% $8,193
revenue
Operating income 43.2 8.7 -79.7 75
Unless otherwise specified, all amounts are on a U.S. GAAP
basis.
Sales increased 31.4% compared with the previous fiscal year (a
27% increase on a local currency basis).
Hardware: There was a significant increase in sales, mainly in
Europe and the U.S., primarily due to a significant contribution
to sales from PSP, which experienced favorable growth in all
geographic areas. In addition, PlayStation 2 ("PS2") sales were
on a par with those in the previous fiscal year.
Software: Although PS2 software sales decreased, as a result of
the contribution to sales from PSP software, sales in Japan, the
U.S. and Europe were relatively unchanged compared to the
previous fiscal year.
Operating income of Y8.7 billion ($75 million) was recorded, a
decrease of Y34.4 billion or 79.7% compared to the previous
fiscal year. Although profits from the PS2 and PSP businesses
exceeded those in the previous fiscal year, this decrease was
mainly the result of continued high research and development
costs associated with PS3, as well as the recording of charges
associated with preparation for the launch of the PS3 platform.
Worldwide hardware production shipments:*
-> PS2: 16.22 million units (an increase of 0.05 million units)
-> PSP: 14.06 million units (an increase of 11.09 million units)
Worldwide software production shipments:*
-> PS2: 223 million units (a decrease of 29 million units)
-> PSP: 41.6 million units (an increase of 35.9 million units)
*Production shipment units of hardware and software are counted
upon shipment of the products from manufacturing bases. Sales of
such products are recognized when the products are delivered to
customers.
Inventory, as of March 31, 2006, was Y113.4 billion ($969
million), a Y35.9 billion, or 46.3%, increase compared with the
level as of March 31, 2005 and a Y9.4 billion, or 9.1%, increase
compared with the level as of December 31, 2005. This increase
was primarily a result of the world-wide full-scale introduction
of the PSP platform to U.S. and European markets in addition to
Japan during the fiscal year.
Pictures
-------- (Billions of yen, millions of U.S. dollars)
Fiscal Year ended March 31
2005 2006 Change in 2006
Yen
----------------- ------ ------ ------ ------
Sales and operating Y733.7 Y745.9 + 1.7% $6,375
revenue
Operating income 63.9 27.4 -57.1 234
The results presented above are a yen-translation of the results
of Sony Pictures Entertainment ("SPE"), a U.S. based operation
which aggregates the results of its worldwide subsidiaries on a
U.S. dollar basis. Management analyzes the results of SPE in
U.S. dollars, so discussion of certain portions of its results
are specified as being on "a U.S. dollar basis."
Sales increased 1.7% compared with the previous fiscal year (4%
decrease on a U.S. dollar basis) due to the depreciation of the
yen. Sales, on a U.S. dollar basis, decreased primarily due to
lower worldwide theatrical and home entertainment revenues on
feature films, partially offset by an increase in television
product revenues. The lower theatrical and home entertainment
revenues primarily resulted from the strong performance of
Spider-Man 2 in the prior fiscal year coupled with the
disappointing performance of certain films in the current fiscal
year film slate, particularly Stealth, Zathura and The Legend of
Zorro. The increase in television product revenues is due to
higher advertising and subscription sales from several of SPE's
international channels, higher sales of television library
product and the extension of a licensing agreement for Wheel of
Fortune.
Operating income decreased Y36.5 billion to Y27.4 billion ($234
million), compared with the previous fiscal year. The large
decrease was due to the same factors contributing to the
decrease in feature film revenue discussed above. Operating
income from television increased due to the same factors noted
above for revenue.
Financial Services
------------------ (Billions of yen, millions of U.S. dollars)
Fiscal Year ended March 31
2005 2006 Change 2006
in Yen
----------------- ------ ------ ------ ------
Financial service Y560.6 Y743.2 +32.6% $6,353
revenue
Operating income 55.5 188.3 +239.4 1,610
Unless otherwise specified, all amounts are on a U.S. GAAP
basis. Therefore, they differ from the results that Sony Life
discloses on a Japanese statutory basis.
Financial service revenue increased by 32.6%, compared with the
previous fiscal year, to Y743.2 billion ($6,353 million) mainly
as a result of an increase in revenue at Sony Life. Revenue at
Sony Life was Y645.0 billion ($5,513 million), a Y170.8 billion,
or 36.0% increase compared with the previous fiscal year. The
main reasons for this increase were an improvement in gains and
losses from investments as a result of favorable Japanese
domestic stock market conditions and an increase in revenue from
insurance premiums reflecting an increase of insurance-in-force.
Operating income was Y188.3 billion ($1,610 million), a Y132.8
billion, or 239.4% increase compared with the previous fiscal
year, mainly as a result of a significant improvement in gains
and losses on investments in the general account at Sony Life,
primarily resulting from an improvement in valuation gains from
stock conversion rights in convertible bonds resulting from
favorable Japanese domestic stock market conditions. As a result
of the abovementioned factors, operating income at Sony Life
increased by Y127.4 billion or 208.8% to Y188.4 billion ($1,611
million).
All Other
--------- (Billions of yen, millions of U.S. dollars)
Fiscal Year ended March 31
2005 2006 Change 2006
in Yen
------------------- ------ ------ ------ ------
Sales and operating Y459.9 Y408.9 -11.1% $3,495
revenue
Operating income 4.2 16.2 +286.4 138
Unless otherwise specified, all amounts are on a U.S. GAAP
basis.
Sales decreased 11.1% compared with the previous fiscal year
reflecting the fact that the results for the first four months
of the previous fiscal year in All Other incorporated the
results for SMEI's recorded music business, which, as noted
above, was combined with Bertelsmann AG's recorded music
business to form the SONY BMG joint venture which is accounted
for by the equity method (please refer to Note to Operating
Performance Highlights by Business Segment).
Sales at SMEJ were relatively unchanged compared with the
previous fiscal year. Best selling albums during the fiscal year
included Ken Hirai 10th Anniversary Complete Single Collection
'95-'05 "Uta Baka" by Ken Hirai, NATURAL by ORANGE RANGE and
BEST by Mika Nakashima.
Excluding sales recorded within Sony's music business, there was
an increase in sales within All Other. This increase was mainly
due to strong sales at a business engaged in the production and
marketing of animation products, favorable sales both at SCN and
its subsidiaries, as well as an increase in sales recorded at an
imported general merchandise retail business.
Operating income of Y16.2 billion ($138 million) was recorded,
an increase of Y12.0 billion compared with the previous fiscal
year. This improvement was mainly the result of the fact that
the results for SMEI's recorded music business, which recorded
an operating loss in the previous fiscal year, are now recorded
as part of the results of the SONY BMG joint venture, and the
continued strong performance at SMEJ. Operating income at SMEJ
increased significantly compared to the previous fiscal year
mainly due to an improvement in the cost of sales ratio and the
recording of a gain resulting from the transfer to the Japanese
government of the substitutional portion of the Employee Pension
Fund.
Excluding the operating income recorded in the music business, a
loss was recorded within All Other mainly as the result of an
asset impairment write down associated with the sale of a U.S.
entertainment complex. This was offset to some extent by cost
reductions at network related businesses within Sony
Corporation.
Operating Results for SONY BMG MUSIC ENTERTAINMENT
--------------------------------------------------
The following operating results for SONY BMG, which is accounted
for by the equity method, are not consolidated in Sony's
consolidated financial statements. However, Sony believes that
this disclosure provides additional useful analytical
information to investors regarding operating performance.
SONY BMG recorded sales revenue of $4,283 million, income before
income taxes of $150 million, and net income of $95 million
during the one year period ended March 31, 2006. Income before
income taxes includes $186 million of restructuring charges, a
year-on-year reduction in restructuring charges of $104 million.
Income before incomes taxes also benefited from the realization
of incremental cost savings. As a result, equity in net income
of Y5.8 billion ($50 million) was recorded by Sony. Best selling
albums during the fiscal year included Kelly Clarkson's
Breakaway, Il Divo's IL Divo and Ancora, System of a Down's
Mezmerize, the Foo Fighters' In Your Honor, and Shakira's
Fijacion Oral Volumen I.
Cash Flow
---------
The following charts show Sony's unaudited condensed statements
of cash flows on a consolidated basis for all segments excluding
the Financial Services segment and for the Financial Services
segment alone. These separate condensed presentations are not
required under U.S. GAAP, which is used in Sony's consolidated
financial statements. However, because the Financial Services
segment is different in nature from Sony's other segments, Sony
believes that these presentations may be useful in understanding
and analyzing Sony's consolidated financial statements.
Cash Flow - Consolidated (excluding Financial Services segment)
---------------------------------------------------------------
(Billions of yen, millions of U.S. dollars)
Fiscal Year ended March 31
Cash flow 2005 2006 Change 2006
in Yen
---------------- ------ ------ ------ ------
- From operating Y485.4 Y252.0 Y-233.5 $2,154
activities
- From investing (472.1) (296.4) +175.7 (2,533)
activities
- From financing (95.4) 74.6 +170.0 637
activities
Cash and cash 592.9 519.7 -73.2 4,442
equivalents at
beginning of the
fiscal year
Cash and cash 519.7 585.5 +65.7 5,004
equivalents at end
of the fiscal year
Operating Activities: During the fiscal year ended March 31,
2006, although there was an increase in inventory, primarily
semiconductor inventory for use in PS3 and inventory of new LCD
television models, net cash was generated primarily after taking
account of depreciation and amortization.
Investing Activities: During the fiscal year ended March 31,
2006, Sony purchased fixed assets mainly within the Electronics
segment consisting primarily of semiconductor manufacturing
facilities. On the other hand, Sony carried out the sale of a
portion of stock resulting from the initial public offering of
SCN and the sale of securities investments. In the previous
fiscal year, in addition to investment in semiconductor
manufacturing facilities, Sony also made an investment in S-LCD
in association with its establishment.
As a result, the total amount of cash flow from operating
activities and from investing activities during the fiscal year
was a use of cash of Y44.4 billion ($379 million).
Financing Activities: During the fiscal year ended March 31,
2006, although Sony redeemed long-term debt including bonds,
financing was carried out through the issuance of straight bonds
in order to redeem bonds maturing during the fiscal years ending
March 31, 2006 and March 31, 2007.
Cash and Cash Equivalents: In addition to the aforementioned
information, the total balance of cash and cash equivalents,
accounting for the effect of foreign currency exchange rate
fluctuations, increased Y65.7 billion compared to March 31,
2005, to Y585.5 billion ($5,004 million) as of March 31, 2006.
Cash Flow - Financial Services segment
--------------------------------------
(Billions of yen, millions of U.S. dollars)
Fiscal Year ended March 31
Cash flow 2005 2006 Change 2006
in Yen
---------------- ------ ------ ------ ------
- From operating Y168.1 Y147.1 Y-20.9 $1,257
activities
- From investing (421.4) (563.8) -142.4 (4,818)
activities
- From financing 256.4 274.9 +18.5 2,349
activities
Cash and cash 256.3 259.4 +3.1 2,217
equivalents at
beginning of the
fiscal year
Cash and cash 259.4 117.6 -141.7 1,005
equivalents at end
of the fiscal year
Operating Activities: Net cash from operating activities was
generated mainly due to an increase in revenue from insurance
premiums, reflecting primarily an increase in insurance-in-force
at Sony Life.
Investing Activities: Payments for investments and advances
exceeded proceeds from maturities of marketable securities,
sales of securities investments and collections of advances
primarily as a result of investments in mainly Japanese fixed
income securities carried out at Sony Life, as well as an
increase in advance payments for mortgage loans and investments
in marketable securities at Sony Bank.
Financing Activities: Net cash from financing activities was
generated as a result of an increase in policyholders' accounts
at Sony Life and an increase in deposits from customers in the
banking business.
Cash and Cash Equivalents: As a result of the above, the balance
of cash and cash equivalents was Y117.6 billion ($1,005 million)
as of March 31, 2006, a decrease of Y141.7 billion compared to
March 31, 2005.
Consolidated Results for the Fourth Quarter ended March 31, 2006
----------------------------------------------------------------
Sales were Y1,845.4 billion ($15,773 million), an increase of
8.7% compared with the same quarter of the previous fiscal year;
on a local currency basis sales increased 2%.
In the Electronics segment, although there was a decrease in
intersegment sales, sales to outside customers increased 9.0%
compared to the same quarter of the previous fiscal year. Sales
primarily of LCD televisions, "VAIO" PCs and LCD rear projection
televisions increased, while sales of CRT televisions decreased.
In the Game segment, although there was an increase in sales
from the PSP business, there was a decrease in overall sales as
a result of a significant decline in the sales contribution from
the PS2 business. In the Pictures segment, revenues increased
primarily as a result of increased television product revenues
from several of SPE's international channels, the extension of a
licensing agreement for Wheel of Fortune, and higher sales of
television library product. In the Financial Services segment,
revenue increased mainly due to an improvement in gains and
losses on investments primarily at Sony Life.
An operating loss of Y62.2 billion ($532 million) was recorded,
an improvement of Y15.2 billion from the same quarter of the
previous fiscal year. In the Electronics segment, although there
was an increase in loss on sale, disposal or impairment of
assets, the amount of the operating loss decreased primarily as
a result of favorable exchange rates. The Game segment recorded
a significant operating loss in the quarter mainly as a result
of the recording of charges associated with the preparation
for the launch of the PS3 platform. In the Pictures segment, the
abovementioned contribution from television product revenues
resulted in increased operating income. Operating income within
the Financial Services segment increased significantly due to
the increased revenue within the segment noted above.
Restructuring charges, which are recorded as operating expenses,
for the fourth quarter amounted to Y75.3 billion ($643 million)
compared to Y48.6 billion in the same quarter of the previous
fiscal year. In the Electronics segment, restructuring charges
were Y63.4 billion ($542 million) compared to Y46.2 billion in
the same quarter of the previous fiscal year.
The loss before income taxes was Y47.9 billion ($409 million), a
Y14.0 billion improvement compared to the same quarter of the
previous fiscal year.
Income Taxes: During the fourth quarter of the fiscal year, Sony
recorded Y23.6 billion ($202 million) of income tax expense.
This was the result of the recording of additional valuation
allowances against deferred tax assets by Sony Corporation and
several of its domestic and overseas consolidated subsidiaries
due to continued losses recorded at these businesses and the
recording of an additional tax provision for the undistributed
earnings of foreign subsidiaries.
Equity in net income of affiliated companies of Y5.4 billion
($46 million) was recorded, a Y4.9 billion yen increase compared
to the same quarter of the previous fiscal year. Sony Ericsson
contributed Y7.6 billion ($65 million) to equity in net income,
a Y5.0 billion increase compared to the same quarter of the
previous fiscal year. In addition, Y2.3 billion ($20 million) of
equity in net income was also recorded from S-LCD, compared to a
Y1.4 billion equity loss in net income recorded in the same
quarter of the previous fiscal year. An equity in net loss of
Y0.3 billion ($2 million) was recorded for SONY BMG, an
improvement of Y2.8 billion compared to the same quarter of the
previous fiscal year. In addition, an equity in net loss of Y3.6
billion ($30 million) was also recorded for MGM.
As a result, a net loss of Y66.5 billion ($569 million) was
recorded, a Y10.1 billion deterioration compared to the same
quarter of the previous fiscal year.
Notes
-----
Note I: During the fiscal year ended March 31, 2006, the average
value of the yen was Y112.3 against the U.S. dollar and Y136.3
against the Euro, which was 5.1% lower against the U.S. dollar
and 2.0% lower against the Euro, compared with the average rates
for the previous fiscal year. Operating results on a local
currency basis described herein reflect sales and operating
income obtained by applying the yen's average exchange rate in
the previous fiscal year to local currency-denominated monthly
sales, cost of sales, and selling, general and administrative
expenses in the fiscal year. Local currency basis results are
not reflected in Sony's financial statements and are not
measures conforming with U.S. GAAP. In addition, Sony does not
believe that these measures are a substitute for U.S. GAAP
measures. However, Sony believes that local currency basis
results provide additional useful analytical information to
investors regarding operating performance.
Note II: "Sales and operating revenue" in each business segment
represents sales and operating revenue recorded before
intersegment transactions are eliminated. "Operating income" in
each business segment represents operating income recorded
before intersegment transactions and unallocated corporate
expenses are eliminated.
Note III: During the quarter ended March 31, 2006, the average
value of the yen was Y115.9 against the U.S. dollar and Y139.2
against the Euro, which was 10.7% lower against the U.S. dollar
and 2.7% lower against the Euro, compared with the average rates
for the same quarter of the previous fiscal year.
Rewarding Shareholders
----------------------
Sony believes that continuously increasing corporate value and
providing dividends are essential to rewarding shareholders. It
is Sony's policy to utilize retained earnings, after ensuring
the perpetuation of stable dividends, to carry out various
investments that contribute to an increase in corporate value
such as those that ensure future growth and strengthen
competitiveness.
A year-end cash dividend of Y12.5 ($0.11) per share of Sony
Corporation common stock will be presented for approval at the
Board of Directors meeting to be held on May 17, 2006 and, if
approved, will be payable as of June 1, 2006. Sony Corporation
has already paid an interim dividend of Y12.5 per share to each
shareholder; accordingly, the total annual cash dividend per
share would be Y25.0.
In addition, even after the New Company Law of Japan becomes
effective as from May 1, 2006, Sony Corporation expects to
continue to pay dividends from retained earnings semi-annually
(record dates for year-end and interim dividends are March 31
and September 30, respectively). This new law replaces the
Commercial Code of Japan and removes the restriction on the
number of times dividends can be paid.
Number of Employees
-------------------
The number of employees at the end of March 2006 was
approximately 158,500, an increase of approximately 7,000
employees from the end of March 2005. Although there was a
reduction in employees associated with the implementation of
restructuring activities in Japan, the U.S., Europe and
Southeast Asia, the total number of employees increased as a
result of a significant increase in employees at manufacturing
facilities in East Asia.
Outlook for the Fiscal Year ending March 31, 2007
-------------------------------------------------
Change from
previous
fiscal year
-------------
Sales and operating revenue Y8,200 billion +10%
Operating income 100 billion -48
Income before income taxes 150 billion -48
Equity in net income of 40 billion +204
affiliated companies
Net income 130 billion +5
Capital expenditures Y460 billion +20%
(additions to fixed assets)
Depreciation and amortization* 410 billion +7
(Depreciation expenses for (340 billion) (+9)
tangible assets)
* Including amortization of intangible assets and amortization
of deferred insurance acquisition costs.
Research and development expenses 550 billion +3%
Assumed foreign currency exchange rates: approximately Y113 to
the U.S. dollar and approximately Y136 to the Euro.
The forecast for the consolidated operating results stated
above, has been prepared based on the current business
environment and reflects the factors noted below.
The above forecast includes restructuring charges, recorded as
operating expenses, of approximately Y50 billion expected to be
incurred across the Sony Group during the fiscal year, primarily
within the Electronics segment, compared to Y138.7 billion of
restructuring charges recorded during the fiscal year ended
March 31, 2006.
With regard to equity in net income of affiliated companies, we
expect improved earnings at Sony Ericsson, SONY BMG, S-LCD and
MGM.
The forecast for each business segment is as follows:
-----------------------------------------------------
Electronics
Sales are expected to increase primarily due to an increase in
the sales of LCD televisions and semiconductors, including those
for use within the Game segment. With regard to operating
performance, operating income is expected to be recorded,
compared to an operating loss in the previous fiscal year, in
spite of the absence of one time net gain recorded in the
previous fiscal year which resulted from the transfer to the
Japanese Government of the substitutional portion of Sony's
Employee Pension Fund, due to a significant improvement in
profitability primarily as a result of the contribution from the
increased sales mentioned above, as well as the reduction in
restructuring charges.
Game
A significant increase in sales is anticipated in association
with the launch of PS3. With regards to operating performance, a
significant loss is expected to be recorded associated with the
worldwide PS3 launch in November 2006, despite the continued
contribution from the PS2 and PSP businesses.
Pictures
Sales and operating income are both expected to increase from
the theatrical and home entertainment contributions on the
upcoming film slate, including The Da Vinci Code in May 2006,
Open Season in September 2006 and the next installment of James
Bond, Casino Royale, in November 2006.
Financial Services
In comparison to the previous fiscal year, when there was a
substantial improvement in gains and losses on investments
resulting from the favorable performance of the Japanese
domestic stock market, the impact of stock market fluctuations
are not incorporated within the forecast for the fiscal year. As
a result, we anticipate both a decline in revenue and a
significant decrease to operating income within the segment.
Semiconductor capital expenditures
Capital expenditures within the semiconductor business during
the fiscal year are expected to amount to approximately Y170
billion (the actual amount in the fiscal year ended March 31,
2006 was approximately Y140 billion)*.
* Investments towards S-LCD are not included within the forecast
for semiconductor capital expenditures.
Cautionary Statement
--------------------
Statements made in this release with respect to Sony's current
plans, estimates, strategies and beliefs and other statements
that are not historical facts are forward-looking statements
about the future performance of Sony. Forward-looking statements
include, but are not limited to, those statements using words
such as "believe," "expect," "plans," "strategy," "prospects,"
"forecast," "estimate," "project," "anticipate," "may" or
"might" and words of similar meaning in connection with a
discussion of future operations, financial performance, events
or conditions. From time to time, oral or written
forward-looking statements may also be included in other
materials released to the public. These statements are based on
management's assumptions and beliefs in light of the information
currently available to it. Sony cautions you that a number of
important risks and uncertainties could cause actual results to
differ materially from those discussed in the forward-looking
statements, and therefore you should not place undue reliance on
them. You also should not rely on any obligation of Sony to
update or revise any forward-looking statements, whether as a
result of new information, future events or otherwise. Sony
disclaims any such obligation. Risks and uncertainties that
might affect Sony include, but are not limited to (i) the global
economic environment in which Sony operates, as well as the
economic conditions in Sony's markets, particularly levels of
consumer spending; (ii) exchange rates, particularly between the
yen and the U.S. dollar, the Euro and other currencies in which
Sony makes significant sales or in which Sony's assets and
liabilities are denominated; (iii) Sony's ability to continue to
design and develop and win acceptance of its products and
services, which are offered in highly competitive markets
characterized by continual new product introductions, rapid
development in technology and subjective and changing consumer
preferences (particularly in the Electronics, Game and Pictures
segments, and music business); (iv) Sony's ability to implement
successfully personnel reduction and other business
reorganization activities in its Electronics segment and music
business; (v) Sony's ability to implement successfully its
network strategy for its Electronics and Pictures segments, All
Other and the music business, and to develop and implement
successful sales and distribution strategies in its Pictures
segment and music business in light of the Internet and other
technological developments; (vi) Sony's continued ability to
devote sufficient resources to research and development and,
with respect to capital expenditures, to correctly prioritize
investments (particularly in the Electronics segment); (vii)
shifts in customer demand for financial services such as life
insurance and Sony's ability to conduct successful Asset
Liability Management in the Financial Services segment; and
(viii) the success of Sony's joint ventures and alliances. Risks
and uncertainties also include the impact of any future events
with material unforeseen impacts.
Business Segment Information
----------------------------
(Millions of yen, millions of U.S. dollars)
Fiscal Year ended March 31
Sales and operating 2005 2006 Change 2006
revenue
------------------ ------ ------ ------ ------
Electronics
Customers Y4,806,494 Y4,763,555 -0.9% $ 40,714
Intersegment 260,339 386,922 3,307
------------------ ------ ------ ------
Total 5,066,833 5,150,477 +1.7 44,021
Game
Customers 702,524 918,251 +30.7 7,848
Intersegment 27,230 40,368 345
------------------ ------ ------ ------
Total 729,754 958,619 +31.4 8,193
Pictures
Customers 733,677 745,859 +1.7 6,375
Intersegment - - -
------------------ ------ ------ ------
Total 733,677 745,859 +1.7 6,375
Financial Services
Customers 537,715 720,566 +34.0 6,159
Intersegment 22,842 22,649 194
------------------ ------ ------ ------
Total 560,557 743,215 +32.6 6,353
All Other
Customers 379,206 327,205 -13.7 2,797
Intersegment 80,688 81,676 698
------------------ ------ ------ ------
Total 459,894 408,881 -11.1 3,495
Elimination (391,099) (531,615) - (4,544)
------------------ ------ ------ ------
Consolidated total Y7,159,616 Y7,475,436 +4.4% $ 63,893
Electronics intersegment amounts primarily consist of transactions
with the Game, Pictures and All Other.
All Other intersegment amounts primarily consist of transactions
with the Electronics and Game segments.
Operating income (loss) 2005 2006 Change 2006
------------------ ------ ------ ------ ------
Electronics Y(34,273) Y(30,930) -% $(264)
Game 43,170 8,747 -79.7 75
Pictures 63,899 27,436 -57.1 234
Financial Services 55,490 188,323 +239.4 1,610
All Other 4,188 16,183 +286.4 138
------------------ ------ ------ ------
Total 132,474 209,759 +58.3 1,793
Corporate and (18,555) (18,504) - (158)
elimination
------------------ ------ ------ ------
Consolidated total Y113,919 Y191,255 +67.9% $1,635
Commencing April 1, 2005, Sony has partly realigned its business
segment configuration. Results of the previous year have been
reclassified to conform to the presentations for the current period
(see Notes 5 and 6).
(Millions of yen, millions of U.S. dollars)
Three months ended March 31 (Unaudited)
Sales and operating 2005 2006 Change 2006
revenue
------------------ ------ ------ ------ ------
Electronics
Customers Y1,066,936 Y1,162,718 +9.0% $ 9,938
Intersegment 116,822 53,590 458
------------------ ------ ------ ------
Total 1,183,758 1,216,308 +2.7 10,396
Game
Customers 213,990 145,855 -31.8 1,247
Intersegment 8,133 6,494 56
------------------ ------ ------ ------
Total 222,123 152,349 -31.4 1,303
Pictures
Customers 190,647 240,382 +26.1 2,054
Intersegment - - -
------------------ ------ ------ ------
Total 190,647 240,382 +26.1 2,054
Financial Services
Customers 150,887 217,289 +44.0 1,857
Intersegment 5,222 5,839 50
------------------ ------ ------ ------
Total 156,109 223,128 +42.9 1,907
All Other
Customers 74,561 79,201 +6.2 677
Intersegment 21,720 22,375 191
------------------ ------ ------ ------
Total 96,281 101,576 +5.5 868
Elimination (151,897) (88,298) - (755)
------------------ ------ ------ ------
Consolidated total Y1,697,021 Y1,845,445 +8.7% $15,773
Electronics intersegment amounts primarily consist of transactions
with the Game, Pictures and All Other.
All Other intersegment amounts primarily consist of transactions
with the Electronics and Game segments.
Operating income (loss) 2005 2006 Change 2006
------------------ ------ ------ ------ ------
Electronics Y(100,457) Y(91,885) -% $ (785)
Game 1,488 (61,397) - (525)
Pictures 13,734 30,201 +119.9 258
Financial Services 16,302 79,306 +386.5 678
All Other (6,400) (10,277) - (88)
------------------ ------ ------ ------
Total (75,333) (54,052) - (462)
Corporate and (2,080) (8,149) - (70)
elimination
------------------ ------ ------ ------
Consolidated total Y(77,413) Y(62,201) -% $ (532)
Commencing April 1, 2005, Sony has partly realigned its business
segment configuration. Results of the previous year have been
reclassified to conform to the presentations for the current
quarter (see Notes 5 and 6).
Electronics Sales and Operating Revenue to Customers by Product
Category
(Millions of yen, millions of U.S. dollars)
Fiscal Year ended March 31
Sales and operating revenue 2005 2006 Change 2006
--------------------------- ------ ------ ------ ------
Audio Y 571,864 Y 536,187 -6.2% $ 4,583
Video 1,036,328 1,021,325 -1.4 8,729
Televisions 921,195 927,769 +0.7 7,930
Information and Communications 816,150 842,537 +3.2 7,201
Semiconductors 246,314 240,771 -2.3 2,058
Components 619,477 656,768 +6.0 5,613
Other 595,166 538,198 -9.6 4,600
--------------------------- ------ ------ ------
Total Y4,806,494 Y4,763,555 -0.9% $ 40,714
Three months ended March 31 (Unaudited)
Sales and operating revenue 2005 2006 Change 2006
--------------------------- ------ ------ ------ ------
Audio Y 106,476 Y 104,684 -1.7% $ 895
Video 208,131 209,284 +0.6 1,789
Televisions 213,567 247,044 +15.7 2,112
Information and Communications 214,366 253,220 +18.1 2,164
Semiconductors 50,657 61,242 +20.9 523
Components 142,640 163,889 +14.9 1,401
Other 131,099 123,355 -5.9 1,054
--------------------------- ------ ------ ------
Total Y1,066,936 Y1,162,718 +9.0% $ 9,938
The above table is a breakdown of Electronics sales and operating
revenue to customers in the Business Segment Information.
The Electronics segment is managed as a single operating segment by
Sony's management. However, Sony believes that the information in
this table is useful to investors in understanding the product
categories in this business segment. In addition, commencing April 1,
2005, Sony has partly realigned its product category configuration in
the Electronics segment. Accordingly, results of the previous year
have been restated (see Note 7).
Geographic Segment Information (Unaudited)
------------------------------------------
(Millions of yen, millions of U.S. dollars)
Fiscal Year ended March 31
Sales and operating revenue 2005 2006 Change 2006
--------------------------- ------ ------ ------ ------
Japan Y2,100,793 Y2,168,723 +3.2% $ 18,536
United States 1,977,310 1,957,644 -1.0 16,732
Europe 1,612,536 1,715,704 +6.4 14,664
Other Areas 1,468,977 1,633,365 +11.2 13,961
--------------------------- ------ ------ ------
Total Y7,159,616 Y7,475,436 +4.4% $ 63,893
Three months ended March 31 (Unaudited)
Sales and operating revenue 2005 2006 Change 2006
--------------------------- ------ ------ ------ ------
Japan Y 519,520 Y 586,124 +12.8% $ 5,010
United States 524,885 443,644 -15.5 3,792
Europe 328,698 396,215 +20.5 3,386
Other Areas 323,918 419,462 +29.5 3,585
--------------------------- ------ ------ ------
Total Y1,697,021 Y1,845,445 +8.7% $ 15,773
Classification of Geographic Segment Information shows sales and
operating revenue recognized by location of customers.
Consolidated Statements of Income
---------------------------------
(Millions of yen, millions of U.S. dollars, except per share amounts)
Fiscal Year ended March 31
2005 2006 Change 2006
------ ------ ------ ------
Sales and operating revenue: %
Net sales Y6,565,010 Y6,692,776 $ 57,203
Financial service revenue 537,715 720,566 6,159
Other operating revenue 56,891 62,094 531
------ ------ ------
7,159,616 7,475,436 +4.4 63,893
Costs and expenses:
Cost of sales 5,000,112 5,151,397 44,029
Selling, general and 1,535,015 1,527,036 13,052
administrative
Financial service expenses 482,576 531,809 4,545
Loss on sale, disposal or 27,994 73,939 632
impairment of assets, net
------ ------ ------
7,045,697 7,284,181 62,258
Operating income 113,919 191,255 +67.9 1,635
Other income:
Interest and dividends 14,708 24,937 213
Royalty income 31,709 35,161 301
Gain on sale of securities 5,437 9,645 82
investments, net
Gain on change in interest 16,322 60,834 520
in subsidiaries and equity
investees
Other 29,447 23,039 197
------ ------ ------
97,623 153,616 1,313
Other expenses:
Interest 24,578 28,996 248
Loss on devaluation of 3,715 3,878 33
securities investments
Foreign exchange loss, net 524 3,065 27
Other 25,518 22,603 193
------ ------ ------
54,335 58,542 501
Income before income taxes 157,207 286,329 +82.1 2,447
Income taxes 16,044 176,515 1,508
------ ------ ------
Income before minority interest, 141,163 109,814 -22.2 939
equity in net income of
affiliated companies and
cumulative effect of an
accounting change
Minority interest in income 1,651 (626) (5)
(loss) of consolidated
subsidiaries
Equity in net income of 29,039 13,176 113
affiliated companies
------ ------ ------
Income before cumulative effect 168,551 123,616 -26.7 1,057
of an accounting change
Cumulative effect of an (4,713) - -
accounting change
(2005: Net of income taxes of
Y2,675 million)
------ ------ ------
Net income Y 163,838 Y 123,616 -24.5 $ 1,057
------ ------ ------
Per share data:
Common stock
Income before cumulative
effect of an accounting
change
- Basic Y 180.96 Y - - $ -
- Diluted 162.59 - - -
Net income
- Basic 175.90 122.58 -30.3 1.05
- Diluted 158.07 116.88 -26.1 1.00
Subsidiary tracking stock
Net income
- Basic * 17.21 - - -
* See Note 3.
Additional Paid-in Capital and Retained Earnings (Unaudited)
------------------------------------------------------------
The following information shows change in additional paid-in
capital for the fiscal year ended March 31, 2005 and 2006 and
change in retained earnings for the fiscal year ended March 31,
2005 and 2006.
Sony discloses this supplemental information in accordance with
disclosure requirements of the Japanese Securities and Exchange
Law, to which Sony, as a Japanese public company, is subject.
(Millions of yen, millions of U.S. dollars)
Fiscal Year ended March 31
2005 2006 2006
------ ------ ------
Additional Paid-in Capital:
Balance, beginning of year Y 992,817 Y 1,134,222 $ 9,694
Conversion of convertible bonds 141,407 1,484 13
Exercise of stock acquisition - 932 8
rights
Stock based compensation 340 - -
Reissuance of treasury stock (342) - -
------ ------ ------
Balance, end of year Y 1,134,222 Y 1,136,638 $ 9,715
(Millions of yen, millions of U.S. dollars)
Fiscal Year ended March 31
2005 2006 2006
------ ------ ------
Retained Earnings:
Balance, beginning of year Y 1,367,060 Y 1,506,082 $ 12,872
Net income 163,838 123,616 1,057
Cash dividends (24,030) (24,968) (213)
Reissuance of treasury stock (245) (1,296) (11)
Common stock issue costs, (541) (780) (7)
net of tax
------ ------ ------
Balance, end of year Y 1,506,082 Y 1,602,654 $ 13,698
Consolidated Statements of Income (Unaudited)
---------------------------------------------
(Millions of yen, millions of U.S. dollars, except per share amounts)
Three months ended March 31
2005 2006 Change 2006
------ ------ ------ ------
Sales and operating revenue: %
Net sales Y1,529,187 Y1,612,012 $ 13,778
Financial service revenue 150,887 217,289 1,857
Other operating revenue 16,947 16,144 138
------ ------ ------
1,697,021 1,845,445 +8.7 15,773
Costs and expenses:
Cost of sales 1,223,358 1,300,497 11,116
Selling, general and 403,126 430,004 3,675
administrative
Financial service expenses 134,457 137,607 1,176
Loss on sale, disposal or 13,493 39,538 338
impairment of assets, net
------ ------ ------
1,774,434 1,907,646 16,305
Operating income (loss) (77,413) (62,201) - (532)
Other income:
Interest and dividends 4,191 7,461 64
Royalty income 9,692 10,299 88
Foreign exchange gain, net 29 224 2
Gain on sale of securities - 798 7
investments, net
Gain on change in interest 1,215 3,357 29
in subsidiaries and
equity investees
Other 10,840 6,959 59
------ ------ ------
25,967 29,098 249
Other expenses:
Interest 2,755 9,032 77
Loss on devaluation of 1,296 763 7
securities investments
Foreign exchange loss, net 14 - -
Other 6,382 4,965 42
------ ------ ------
10,447 14,760 126
Income (loss) before income (61,893) (47,863) - (409)
taxes
Income taxes (5,334) 23,572 202
------ ------ ------
Income (loss) before (56,559) (71,435) - (611)
minority interest and
equity in net income of
affiliated companies
Minority interest in 351 467 4
income of consolidated
subsidiaries
Equity in net income of 460 5,369 46
affiliated companies
------ ------ ------
Net income (loss) Y (56,450)Y (66,533) - $ (569)
------ ------ ------
Per share data:
Common stock
Net income (loss)
- Basic Y (59.40)Y (66.48) - $ (0.57)
- Diluted (59.40) (66.48) - (0.57)
Subsidiary tracking
stock
Net income (loss)
- Basic * (28.20) - - -
(See Note 3)
Consolidated Balance Sheets
---------------------------
(Millions of yen, millions of U.S. dollars)
March 31
ASSETS 2005 2006 2006
------ ------ ------
Current assets:
Cash and cash equivalents Y 779,103 Y 703,098 $ 6,009
Marketable securities 460,202 536,968 4,589
Notes and accounts receivable, 1,113,071 1,075,071 9,189
trade
Allowance for doubtful accounts (87,709) (89,563) (765)
and sales returns
Inventories 631,349 804,724 6,878
Deferred income taxes 141,154 221,311 1,892
Prepaid expenses and other 519,001 517,915 4,426
current assets
------ ------ ------
3,556,171 3,769,524 32,218
Film costs 278,961 360,372 3,080
Investments and advances:
Affiliated companies 252,905 285,870 2,443
Securities investments and 2,492,784 3,234,037 27,642
other
------ ------ ------
2,745,689 3,519,907 30,085
Property, plant and equipment:
Land 182,900 178,844 1,529
Buildings 925,796 926,783 7,921
Machinery and equipment 2,192,038 2,327,676 19,895
Construction in progress 92,611 116,149 993
Less-Accumulated depreciation (2,020,946) (2,160,905) (18,470)
------ ------ ------
1,372,399 1,388,547 11,868
Other assets:
Intangibles, net 187,024 207,034 1,770
Goodwill 283,923 299,024 2,556
Deferred insurance acquisition 374,805 383,156 3,275
costs
Deferred income taxes 240,396 178,751 1,528
Other 459,732 501,438 4,285
------ ------ ------
1,545,880 1,569,403 13,414
------ ------ ------
Y 9,499,100 Y10,607,753 $ 90,665
------ ------ ------
LIABILITIES AND STOCKHOLDERS'
EQUITY
Current liabilities:
Short-term borrowings Y 63,396 Y 142,766 $ 1,220
Current portion of long-term 166,870 193,555 1,654
debt
Notes and accounts payable, 806,044 813,332 6,952
trade
Accounts payable, other and 746,466 854,886 7,307
accrued expenses
Accrued income and other taxes 55,651 87,295 746
Deposits from customers in the 546,718 599,952 5,128
banking business
Other 424,223 508,442 4,345
------ ------ ------
2,809,368 3,200,228 27,352
Long-term liabilities:
Long-term debt 678,992 764,898 6,538
Accrued pension and severance 352,402 182,247 1,558
costs
Deferred income taxes 72,227 216,497 1,850
Future insurance policy 2,464,295 2,744,321 23,456
benefits and other
Other 227,631 258,609 2,211
------ ------ ------
3,795,547 4,166,572 35,613
Minority interest in consolidated 23,847 37,101 317
subsidiaries
Stockholders' equity:
Capital stock 621,709 624,124 5,334
Additional paid-in capital 1,134,222 1,136,638 9,715
Retained earnings 1,506,082 1,602,654 13,698
Accumulated other comprehensive (385,675) (156,437) (1,337)
income (loss)
Treasury stock, at cost (6,000) (3,127) (27)
------ ------ ------
2,870,338 3,203,852 27,383
------ ------ ------
Y 9,499,100 Y10,607,753 $ 90,665
------ ------ ------
Consolidated Statements of Cash Flows
-------------------------------------
(Millions of yen, millions of U.S. dollars)
Fiscal Year ended March 31
2005 2006 2006
------ ------ ------
Cash flows from operating
activities:
Net income Y 163,838 Y 123,616 $ 1,057
Adjustments to reconcile net
income to net cash provided
by operating activities:
Depreciation and amortization, 372,865 381,843 3,264
including amortization of
deferred insurance
acquisition costs
Amortization of film costs 276,320 286,655 2,450
Accrual for pension and 22,837 (7,563) (65)
severance costs, less
payments
Gain on the transfer to - (73,472) (628)
the Japanese Government of
the substitutional portion
of employee pension fund
Loss on sale, disposal or 27,994 73,939 632
impairment of assets, net
Gain on sale or loss on (1,722) (5,767) (49)
devaluation of securities
investments, net
Gain on change in interest in (16,322) (60,834) (520)
subsidiaries and equity
investees
Deferred income taxes (69,466) 80,115 685
Equity in net (income) loss (15,648) 9,794 84
of affiliated companies, net
of dividends
Cumulative effect of an 4,713 - -
accounting change
Changes in assets and liabilities:
(Increase) Decrease in (22,056) 17,464 149
notes and accounts
receivable, trade
(Increase) Decrease in 34,128 (164,772) (1,408)
inventories
Increase in film costs (294,272) (339,697) (2,903)
Increase (Decrease) in 31,473 (9,078) (78)
notes and accounts
payable, trade
Increase in accrued income 3 29,009 248
and other taxes
Increase in future insurance 144,143 143,122 1,223
policy benefits and other
Increase in deferred (65,051) (51,520) (440)
insurance acquisition costs
Increase in marketable (28,524) (37,394) (320)
securities held in
the financial service
business for trading purpose
Increase in other current (29,699) (8,792) (75)
assets
Increase in other current 46,545 105,865 904
liabilities
Other 64,898 (92,675) (792)
------ ------ ------
Net cash provided by 646,997 399,858 3,418
operating activities
------ ------ ------
Cash flows from investing
activities:
Payments for purchases of (453,445) (462,473) (3,953)
fixed assets
Proceeds from sales of fixed 34,184 38,168 326
assets
Payments for investments and (1,309,092) (1,368,158) (11,694)
advances by financial
service business
Payments for investments and (158,151) (36,947) (316)
advances (other than financial
service business)
Proceeds from maturities of 923,593 857,376 7,328
marketable securities, sales
of securities investments and
collections of advances by
financial service business
Proceeds from maturities of 25,849 24,527 210
marketable securities, sales
of securities investments and
collections of advances (other
than financial service
business)
Proceeds from sales of 3,162 75,897 649
subsidiaries' and equity
investees' stocks
Other 2,728 346 3
------ ------ ------
Net cash used in investing (931,172) (871,264) (7,447)
activities
------ ------ ------
Cash flows from financing
activities:
Proceeds from issuance of 57,232 246,326 2,105
long-term debt
Payments of long-term debt (94,862) (138,773) (1,186)
Increase (Decrease) in 11,397 (11,045) (94)
short-term borrowings
Increase in deposits from 294,352 190,320 1,627
customers in the financial
service business
Increase (Decrease) in (40,400) 86,100 736
call money and bills sold in
the banking business
Dividends paid (22,978) (24,810) (212)
Proceeds from issuance of 4,023 6,937 59
stocks by subsidiaries
Other (3,587) 4,809 41
------ ------ ------
Net cash provided by 205,177 359,864 3,076
financing activities
------ ------ ------
Effect of exchange rate changes on 8,890 35,537 303
cash and cash equivalents
------ ------ ------
Net decrease in cash and cash (70,108) (76,005) (650)
equivalents
Cash and cash equivalents at 849,211 779,103 6,659
beginning of the fiscal year
------ ------ ------
Cash and cash equivalents at Y 779,103 Y 703,098 $ 6,009
end of the fiscal year
------ ------ ------
(Notes)
1. U.S. dollar amounts have been translated from yen, for
convenience only, at the rate of Y117 = U.S. $1, the approximate
Tokyo foreign exchange market rate as of March 31, 2006.
2. As of March 31, 2006, Sony had 936 consolidated
subsidiaries (including variable interest entities). It has
applied the equity accounting method in respect to 58 affiliated
companies.
3. Sony calculates and presents per share data separately
for Sony's common stock and for the subsidiary tracking stock
which was linked to the economic value of Sony Communication
Network Corporation, based on Statement of Financial Accounting
Standards ("FAS") No.128, "Earnings per Share". The holders of
the subsidiary tracking stock had the right to participate in
earnings, together with common stock holders. Accordingly, Sony
calculated per share data by the "two-class" method based on FAS
No.128. Under this method, basic net income per share for each
class of stock was calculated based on the earnings allocated to
each class of stock for the applicable period, divided by the
weighted-average number of outstanding shares in each class
during the applicable period. The earnings allocated to the
subsidiary tracking stock were determined based on the
subsidiary tracking stockholders' economic interest in the
targeted subsidiary's earnings available for dividends or change
in accumulated losses that did not include those of the targeted
subsidiary's subsidiaries.
On October 26, 2005, the Board of Directors of Sony Corporation
decided to terminate all shares of subsidiary tracking stock
with the method of compulsory conversion to shares of Sony's
common stock. All shares of subsidiary tracking stock were
converted to shares of Sony's common stock on December 1, 2005.
As a result of the conversion, earnings per share of the
subsidiary tracking stock for the three months and the fiscal
year ended March 31, 2006 are not calculated. The earnings
allocated to common stock for the fiscal year ended March 31,
2006 are calculated by subtracting the earnings allocated to
the subsidiary tracking stock for eight months ended November
30, 2005.
Weighted-average number of outstanding shares used for
computation of earnings per share of common stock are as
follows. The dilutive effect in the weighted-average number of
outstanding shares for the three months and the fiscal years
ended March 31, 2005 and 2006 mainly resulted from convertible
bonds.
Weighted-average number (Thousands of shares)
of outstanding shares Fiscal Year ended March 31
----------------------- 2005 2006
------ ------
Income before cumulative
effect of an accounting
change and net income
- Basic 931,125 997,781
- Diluted 1,043,775 1,046,177
Weighted-average number (Thousands of shares)
of outstanding shares Three months ended March 31
----------------------- 2005 2006
------ ------
Net income
- Basic 948,950 1,000,832
- Diluted 948,950 1,000,832
Weighted-average number of outstanding shares used for
computation of earnings per share of the subsidiary tracking
stock for the three months and the fiscal year ended March
31, 2005 are 3,072 thousand shares. There were no potentially
dilutive securities or options granted for earnings per share
of the subsidiary tracking stock.
4. Sony's comprehensive income is comprised of net income
and other comprehensive income. Other comprehensive income
includes changes in unrealized gains or losses on securities,
unrealized gains or losses on derivative instruments, minimum
pension liabilities adjustments and foreign currency translation
adjustments. Net income, other comprehensive income and
comprehensive income for the three months and the fiscal years
ended March 31, 2005 and 2006 were as follows:
(Millions of yen, millions of U.S. dollars)
Fiscal Year ended March 31 Three months ended March 31
-------------------------- ---------------------------
2005 2006 2006 2005 2006 2006
--------------------------------------------------------------------------
Net income Y 163,838 Y 123,616 $ 1,057 Y (56,450) Y (66,533) $ (569)
(loss)
Other
comprehensive
income (loss):
Unrealized (7,281) 38,135 326 7,012 (44,453) (380)
gains
(losses)
on
securities
Unrealized (1,890) 441 4 (2,009) (563) (5)
gains
(losses) on
derivative
instruments
Minimum (769) 50,206 429 (29,304) 18,777 160
pension
liabilities
adjustments
Foreign 74,224 140,456 1,200 43,858 8,133 70
currency
translation
adjustments
----------------------------------------------------------
64,284 229,238 1,959 19,557 Y (18,106) (155)
-------------------------------------------------------------------------
Comprehensive Y 228,122 Y 352,854 $ 3,016 Y (36,893) Y (84,639) $ (724)
income
(loss)
--------------------------------------------------------------------------
5. As of August 1, 2004, Sony and Bertelsmann AG combined
their recorded music businesses in a joint venture. In
connection with the establishment of this joint venture, the
non-Japan based disc manufacturing and physical distribution
businesses, formerly included within the Music segment, have
been reclassified to "Other" category in the Electronics
segment. In addition, effective April 1, 2005, a similar
change was made with respect to the Japan based disc
manufacturing businesses. Results for the same period of the
previous year in the Electronics segment have been restated
to account for these reclassifications.
As a result of these changes in the Music segment, Sony no
longer breaks out the Music segment as a reportable segment as
it no longer meets the materiality threshold. Effective April 1,
2005, results for the Music segment are included within All
Other. Accordingly, results for the same period of the previous
fiscal year in the Electronics segment and All Other have been
restated to conform to the presentation for this fiscal year.
6. In July 2004, in order to establish a more efficient
and coordinated semiconductor supply structure, Sony group has
integrated its semiconductor manufacturing business by
transferring Sony Computer Entertainment's semiconductor
manufacturing operation from the Game segment to the Electronics
segment. As a result of this transfer, sales revenue and
expenditures associated with this operation are now recorded
within the "Semiconductor" category in the Electronics segment.
The results for the three months ended June 30, 2004 have not
been restated as such comparable figures cannot be practically
obtained given that it was not operated as a separate line of
business within the Game segment. This integration of the
semiconductor manufacturing businesses is a part of Sony's
semiconductor strategy of utilizing semiconductor technologies
and manufacturing equipment originally developed or designed for
the Game business within the Sony group as a whole.
7. Commencing April 1, 2005, Sony has partly realigned
its product category configuration in the Electronics segment.
Accordingly, results for the same period of the previous fiscal
year have been reclassified. The primary change is as shown
below:
Main Product Previous Product Category New Product Category
------------ ------------------------- --------------------
Professional "Televisions" --> "Information and
-use Communications"
projector
8. In July 2003, the Accounting Standards Executive
Committee of the American Institute of Certified Public
Accountants issued Statement of Position ("SOP") 03-1,
"Accounting and Reporting by Insurance Enterprises for Certain
Nontraditional Long-Duration Contracts and for Separate
Accounts". SOP 03-1 requires insurance enterprises to record
additional reserves for long-duration life insurance contracts
with minimum guarantee or annuity receivable options.
Additionally, SOP 03-1 provides guidance for the presentation of
separate accounts. This statement is effective for fiscal years
beginning after December 15, 2003. Sony adopted SOP 03-1 on
April 1, 2004. On April 1, 2004, Sony recognized Y4,713 million
of loss (net of income taxes of Y2,675 million) as a cumulative
effect of an accounting change.
9. In December 2004, the FASB issued FAS No. 153,
"Exchanges of Nonmonetary Assets, an amendment of APB Opinion
No. 29". This statement requires that exchanges of productive
assets be accounted for at fair value unless fair value cannot
be reasonably determined or the transaction lacks commercial
substance. This statement is effective for nonmonetary asset
exchanges occurring in the fiscal periods beginning after June
15, 2005. Sony adopted FAS No. 153 during the quarter ended
September 30, 2005. The adoption of FAS No. 153 did not have a
material impact on Sony's results of operations and financial
position.
Other Consolidated Financial Data
(Millions of yen, millions of U.S. dollars)
Fiscal Year ended March 31
2005 2006 Change 2006
------ ------ ------ ------
Capital expenditures Y 356,818 Y 384,347 +7.7% $ 3,285
(additions to property,
plant and equipment)
Depreciation and 372,865 381,843 +2.4 3,264
amortization expenses*
(Depreciation expenses for (300,752) (310,519) +3.2 (2,654)
tangible assets)
R&D expenses 502,008 531,795 +5.9 4,545
Three months ended March 31
2005 2006 Change 2006
------ ------ ------ ------
Capital expenditures Y 99,996 Y 122,427 +22.4% $ 1,046
(additions to property,
plant and equipment)
Depreciation and 104,125 103,584 -0.5 885
amortization expenses*
(Depreciation expenses for (83,672) (84,013) +0.4 (718)
tangible assets)
R&D expenses 131,978 160,370 +21.5 1,371
* Including amortization expenses for intangible assets and for
deferred insurance acquisition costs
Condensed Financial Services Financial Statements (Unaudited)
-------------------------------------------------------------
The results of the Financial Services segment are included in Sony's
consolidated financial statements. The following schedules show
unaudited condensed financial statements for the Financial Services
segment and all other segments excluding Financial Services.
These presentations are not required under U.S. GAAP, which is used in
Sony's consolidated financial statements. However, because the
Financial Services segment is different in nature from Sony's other
segments, Sony believes that a comparative presentation may be useful
in understanding and analyzing Sony's consolidated financial statements.
Transactions between the Financial Services segment and Sony without
Financial Services are eliminated in the consolidated figures
shown below.
Condensed Statements of Income
------------------------------
(Millions of yen, millions of U.S. dollars)
Fiscal Year ended March 31
Financial Services 2005 2006 Change 2006
%
------ ------ ------ ------
Financial service revenue Y 560,557 Y 743,215 +32.6 $ 6,353
Financial service expenses 505,067 554,892 +9.9 4,743
------ ------ ------
Operating income 55,490 188,323 +239.4 1,610
Other income (expenses), net 10,204 24,522 +140.3 209
------ ------ ------
Income before income taxes 65,694 212,845 +224.0 1,819
Income taxes and other 25,698 80,586 +213.6 689
------ ------ ------
Income before cumulative effect 39,996 132,259 +230.7 1,130
of an accounting change
Cumulative effect of an (4,713) - - -
accounting change
------ ------ ------
Net income Y 35,283 Y 132,259 +274.9 $ 1,130
------ ------ ------
(Millions of yen, millions of U.S. dollars)
Fiscal Year ended March 31
Sony without Financial 2005 2006 Change 2006
Services %
------ ------ ------
Net sales and operating Y6,632,728 Y6,763,907 +2.0 $57,811
revenue
Costs and expenses 6,575,354 6,762,375 +2.8 57,798
------ ------ ------
Operating income 57,374 1,532 -97.3 13
Other income (expenses), 40,639 71,952 +77.1 615
net
------ ------ ------
Income before income taxes 98,013 73,484 -25.0 628
Income taxes and other (37,043) 82,127 - 702
------ ------ ------
Net income (loss) Y 135,056 Y (8,643) - $ (74)
------ ------ ------
(Millions of yen, millions of U.S. dollars)
Consolidated Fiscal Year ended March 31
2005 2006 Change 2006
%
------ ------ ------ ------
Financial service revenue Y 537,715 Y 720,566 +34.0 $ 6,159
Net sales and operating 6,621,901 6,754,870 +2.0 57,734
revenue
------ ------ ------
7,159,616 7,475,436 +4.4 63,893
Costs and expenses 7,045,697 7,284,181 +3.4 62,258
------ ------ ------
Operating income 113,919 191,255 +67.9 1,635
Other income (expenses), 43,288 95,074 +119.6 812
net
------ ------ ------
Income before income taxes 157,207 286,329 +82.1 2,447
Income taxes and other (11,344) 162,713 - 1,390
------ ------ ------
Income before cumulative 168,551 123,616 -26.7 1,057
effect of an accounting
change
Cumulative effect of an (4,713) - - -
accounting change
------ ------ ------
Net income Y 163,838 Y 123,616 -24.5 $ 1,057
------ ------ ------
Condensed Statements of Income
------------------------------
(Millions of yen, millions of U.S. dollars)
Three months ended March 31
Financial Services 2005 2006 Change 2006
%
------ ------ ------ ------
Financial service revenue Y 156,109 Y 223,128 +42.9 $ 1,907
Financial service expenses 139,807 143,822 +2.9 1,229
------ ------ ------
Operating income 16,302 79,306 +386.5 678
Other income (expenses), net 450 (123) - (1)
------ ------ ------
Income before income taxes 16,752 79,183 +372.7 677
Income taxes and other 6,841 29,760 +335.0 255
------ ------ ------
Net income Y 9,911 Y 49,423 +398.7 $ 422
------ ------ ------
(Millions of yen, millions of U.S. dollars)
Three months ended March 31
Sony without Financial 2005 2006 Change 2006
Services %
------ ------ ------ ------
Net sales and operating Y1,549,209 Y1,631,085 +5.3 $13,941
revenue
Costs and expenses 1,643,498 1,772,917 +7.9 15,153
------ ------ ------
Operating income (loss) (94,289) (141,832) - (1,212)
Other income (expenses), net 15,644 14,917 -4.6 127
------ ------ ------
Income (loss) before income (78,645) (126,915) - (1,085)
taxes
Income taxes and other (12,285) (11,089) - (95)
------ ------ ------
Net income (loss) Y (66,360)Y (115,826) - $ (990)
------ ------ ------
(Millions of yen, millions of U.S. dollars)
Three months ended March 31
Consolidated 2005 2006 Change 2006
%
------ ------ ------ ------
Financial service revenue Y 150,887 Y 217,289 +44.0 $ 1,857
Net sales and operating 1,546,134 1,628,156 +5.3 13,916
revenue
------ ------ ------
1,697,021 1,845,445 +8.7 15,773
Costs and expenses 1,774,434 1,907,646 +7.5 16,305
------ ------ ------
Operating income (loss) (77,413) (62,201) - (532)
Other income (expenses), net 15,520 14,338 -7.6 123
------ ------ ------
Income (loss) before income (61,893) (47,863) - (409)
taxes
Income taxes and other (5,443) 18,670 - 160
------ ------ ------
Net income (loss) Y (56,450)Y (66,533) - $ (569)
------ ------ ------
Condensed Balance Sheet
------------------------
(Millions of yen, millions of U.S. dollars)
Financial Services March 31
ASSETS 2005 2006 2006
------ ------ ------
Current assets:
Cash and cash equivalents Y 259,371 Y 117,630 $ 1,005
Marketable securities 456,130 532,895 4,555
Other 274,690 200,929 1,717
------ ------ ------
990,191 851,454 7,277
Investments and advances 2,378,966 3,128,748 26,741
Property, plant and equipment 38,551 37,422 320
Other assets:
Deferred insurance acquisition 374,805 383,156 3,275
costs
Other 103,004 164,827 1,409
------ ------ ------
477,809 547,983 4,684
------ ------ ------
Y3,885,517 Y 4,565,607 $ 39,022
------ ------ ------
LIABILITIES AND STOCKHOLDERS'
EQUITY
Current liabilities:
Short-term borrowings Y 45,358 Y 136,723 $ 1,169
Notes and accounts payable, 7,099 11,707 100
trade
Deposits from customers in 546,718 599,952 5,128
the banking business
Other 109,438 169,956 1,452
------ ------ ------
708,613 918,338 7,849
Long-term liabilities:
Long-term debt 135,750 128,097 1,095
Accrued pension and severance 14,362 13,479 115
costs
Future insurance policy 2,464,295 2,744,321 23,456
benefits and other
Other 142,272 173,354 1,481
------ ------ ------
2,756,679 3,059,251 26,147
Minority interest in consolidated 5,476 4,089 35
subsidiaries
Stockholders' equity 414,749 583,929 4,991
------ ------ ------
Y3,885,517 Y 4,565,607 $ 39,022
------ ------ ------
(Millions of yen, millions of U.S. dollars)
Sony without Financial Services March 31
ASSETS 2005 2006 2006
------ ------ ------
Current assets:
Cash and cash equivalents Y 519,732 Y 585,468 $ 5,004
Marketable securities 4,072 4,073 34
Notes and accounts receivable, 952,692 973,675 8,322
trade
Other 1,116,353 1,393,306 11,909
------ ------ ------
2,592,849 2,956,522 25,269
Film costs 278,961 360,372 3,080
Investments and advances 445,446 477,089 4,078
Investments in Financial Services, 187,400 187,400 1,602
at cost
Property, plant and equipment 1,333,848 1,351,125 11,548
Other assets 1,189,398 1,059,786 9,058
------ ------ ------
Y6,027,902 Y 6,392,294 $ 54,635
------ ------ ------
LIABILITIES AND STOCKHOLDERS'
EQUITY
Current liabilities:
Short-term borrowings Y 204,027 Y 225,082 $ 1,924
Notes and accounts payable, 801,252 804,394 6,875
trade
Other 1,132,201 1,299,809 11,109
------ ------ ------
2,137,480 2,329,285 19,908
Long-term liabilities:
Long-term debt 627,367 701,372 5,995
Accrued pension and severance 338,040 168,768 1,443
costs
Other 263,520 352,457 3,012
------ ------ ------
1,228,927 1,222,597 10,450
Minority interest in consolidated 18,471 32,623 279
subsidiaries
Stockholders' equity 2,643,024 2,807,789 23,998
------ ------ ------
Y 6,027,902 Y 6,392,294 $ 54,635
------ ------ ------
(Millions of yen, millions of U.S. dollars)
Consolidated March 31
ASSETS 2005 2006 2006
------ ------ ------
Current assets:
Cash and cash equivalents Y 779,103 Y 703,098 $ 6,009
Marketable securities 460,202 536,968 4,589
Notes and accounts receivable, 1,025,362 985,508 8,424
trade
Other 1,291,504 1,543,950 13,196
------ ------ ------
3,556,171 3,769,524 32,218
Film costs 278,961 360,372 3,080
Investments and advances 2,745,689 3,519,907 30,085
Property, plant and equipment 1,372,399 1,388,547 11,868
Other assets:
Deferred insurance acquisition 374,805 383,156 3,275
costs
Other 1,171,075 1,186,247 10,139
------ ------ ------
1,545,880 1,569,403 13,414
------ ------ ------
Y 9,499,100 Y10,607,753 $ 90,665
------ ------ ------
LIABILITIES AND STOCKHOLDERS'
EQUITY
Current liabilities:
Short-term borrowings Y 230,266 Y 336,321 $ 2,874
Notes and accounts payable, 806,044 813,332 6,952
trade
Deposits from customers in 546,718 599,952 5,128
the banking business
Other 1,226,340 1,450,623 12,398
------ ------ ------
2,809,368 3,200,228 27,352
Long-term liabilities:
Long-term debt 678,992 764,898 6,538
Accrued pension and severance 352,402 182,247 1,558
costs
Future insurance policy 2,464,295 2,744,321 23,456
benefits and other
Other 299,858 475,106 4,061
------ ------ ------
3,795,547 4,166,572 35,613
Minority interest in consolidated 23,847 37,101 317
subsidiaries
Stockholders' equity 2,870,338 3,203,852 27,383
------ ------ ------
Y 9,499,100 Y10,607,753 $ 90,665
Condensed Statements of Cash Flows
----------------------------------
(Millions of yen, millions of U.S. dollars)
Fiscal Year ended March 31
Financial Services 2005 2006 2006
------ ------ ------
Net cash provided by operating Y 168,078 Y 147,149 $ 1,257
activities
Net cash used in investing (421,384) (563,753) (4,818)
activities
Net cash provided by financing 256,361 274,863 2,349
activities
------ ------ ------
Net increase (decrease) in cash 3,055 (141,741) (1,212)
and cash equivalents
Cash and cash equivalents at 256,316 259,371 2,217
beginning of the fiscal year
------ ------ ------
Cash and cash equivalents at end Y 259,371 Y 117,630 $ 1,005
of the fiscal year
------ ------ ------
(Millions of yen, millions of U.S. dollars)
Sony without Financial Services Fiscal Year ended March 31
2005 2006 2006
------ ------ ------
Net cash provided by operating Y 485,439 Y 251,975 $ 2,154
activities
Net cash used in investing (472,119) (296,376) (2,533)
activities
Net cash provided by (used in) (95,373) 74,600 637
financing activities
Effect of exchange rate changes on 8,890 35,537 304
cash and cash equivalents
------ ------ ------
Net increase (decrease) in cash (73,163) 65,736 562
and cash equivalents
Cash and cash equivalents at 592,895 519,732 4,442
beginning of the fiscal year
------ ------ ------
Cash and cash equivalents at end Y 519,732 Y 585,468 $ 5,004
of the fiscal year
------ ------ ------
(Millions of yen, millions of U.S. dollars)
Consolidated Fiscal Year ended March 31
2005 2006 2006
------ ------ ------
Net cash provided by operating Y 646,997 Y 399,858 $ 3,418
activities
Net cash used in investing (931,172) (871,264) (7,447)
activities
Net cash provided by financing 205,177 359,864 3,076
activities
Effect of exchange rate changes on 8,890 35,537 303
cash and cash equivalents
------ ------ ------
Net decrease in cash and cash (70,108) (76,005) (650)
equivalents
Cash and cash equivalents at 849,211 779,103 6,659
beginning of the fiscal year
------ ------ ------
Cash and cash equivalents at end Y 779,103 Y 703,098 $ 6,009
of the fiscal year
------ ------ ------
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