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 May 2007
Commission File Number: 001-06439
SONY CORPORATION
(Translation of registrant's name into English)
1-7-1 KONAN, MINATO-KU, TOKYO, 108-0075, 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: May 16, 2007
List of materials
Documents attached hereto:
i) Press release announcing Consolidated Financial Results for the Fiscal Year
Ended March 31, 2007
Sony Corporation
1-7-1 Konan, Minato-ku
Tokyo 108-0075 Japan
No: 07-047E
3:00 P.M. JST, May 16, 2007
Consolidated Financial Results
for the Fiscal Year Ended March 31, 2007
Tokyo, May 16, 2007 -- Sony Corporation today announced its
consolidated results for the fiscal year ended March 31, 2007
(April 1, 2006 to March 31, 2007).
(Billions of yen, millions of U.S. dollars, except per share amounts)
Fiscal Year ended March 31
2006 2007 Change 2007*
in Yen
---------- ------ ------ ------ ------
Sales and operating Y7,510.6 Y8,295.7 +10.5% $70,303
revenue**
Operating income 226.4 71.8 -68.3 608
Income before income 286.3 102.0 -64.4 865
taxes
Equity in net income 13.2 78.7 +496.9 667
of affiliated
companies
Net income 123.6 126.3 +2.2 1,071
Net income per share
of common stock
- Basic Y122.58 Y126.15 +2.9% $1.07
- Diluted 116.88 120.29 +2.9 1.02
Unless otherwise specified, all amounts are presented in
accordance with accounting principles generally accepted in the
United States ("U.S. GAAP").
* U.S. dollar amounts have been translated from yen, for
convenience only, at the rate of Y118=U.S.$1, the approximate
Tokyo foreign exchange market rate as of March 30, 2007.
** Effective April 1, 2006, Sony reclassified royalty income as
a component of sales and operating revenue, rather than as a
component of other income as previously recorded. As a result,
this reclassification has also been made to sales and operating
revenue, operating income and other income for the fourth
quarter and the fiscal year ended March 31, 2006 to conform with
the presentation of these items for the fourth quarter and the
fiscal year ended March 31, 2007. Royalty income for the fourth
quarter and the fiscal year ended March 31, 2007 was Y9.6
billion and Y35.1 billion, respectively. Royalty income for the
fourth quarter and the fiscal year ended March 31, 2006 was
Y10.6 billion and Y35.4 billion, respectively. These amounts
were recorded primarily within the Electronics segment.
Consolidated Results for the Fiscal Year Ended March 31, 2007
-------------------------------------------------------------
Sales and operating revenue ("sales") increased 10.5% (a 7%
increase on a local currency basis) compared with the previous
fiscal year. (For all references herein to the results on a
local currency basis, see Note I.)
Sales within the Electronics segment increased 16.9% (a 12%
increase on a local currency basis). Products such as "BRAVIA(TM)"
LCD televisions, "VAIO(TM)" PCs, and "Cyber-shot(TM)" digital
cameras contributed to the sales increase, although there was a
decline in sales of such products as CRT televisions. In the
Game segment, sales increased by 6.1% compared with the previous
fiscal year due to the launch of PLAYSTATION(R)3 ("PS3"). Sales
in the Pictures segment increased 29.5% compared with the
previous fiscal year due to the success of films such as The Da
Vinci Code and Casino Royale. In the Financial Services segment,
revenue declined 12.6% compared to the previous fiscal year
mainly due to a decrease in valuation gains in the general
account and the separate account at Sony Life Insurance Co.,
Ltd. ("Sony Life").
Operating income decreased 68.3% compared with the previous
fiscal year.
In the Electronics segment, there was a substantial increase in
operating income due primarily to an increase in sales to
outside customers and the positive impact from the depreciation
of the yen versus the U.S. dollar and the Euro. The operating
income for the prior fiscal year included a one time net gain
resulting from the transfer to the Japanese government of the
substitutional portion of Sony's Employee Pension Fund, of which
Y64.5 billion was recorded within the Electronics segment.
During the current fiscal year, Sony recorded a Y51.2 billion
($434 million) provision that relates to charges incurred as a
result of the recalls by Dell Inc., Apple Inc. and Lenovo, Inc.
of notebook computer battery packs that use lithium-ion battery
cells manufactured by Sony and the subsequent global replacement
program initiated by Sony for certain notebook computer battery
packs used by Sony and several other notebook computer
manufacturers that use lithium-ion battery cells manufactured by
Sony. In the Game segment, there was a significant operating
loss as a result of the sale of PS3 at strategic price points
lower than its production cost during the introductory period.
In the Pictures segment, operating income increased due to
strong worldwide theatrical and home entertainment revenue on
feature films released in the current fiscal year. In the
Financial Services segment, there was a significant decline in
operating income as a result of decreased valuation gains from
investments in the general account, including valuation gains
from convertible bonds.
During this fiscal year, restructuring charges, which are
recorded as operating expenses, totaled Y38.8 billion ($329
million) compared to Y138.7 billion in the previous fiscal year.
In the Electronics segment, restructuring charges were Y37.4
billion ($317 million) compared to Y125.8 billion in the
previous fiscal year.
A gain on the sale of a portion of the site of Sony's former
headquarters in the amount of Y21.7 billion ($184 million) is
included in operating income for the current fiscal year.
Operating income in the previous fiscal year included a one time
net gain of Y73.5 billion, which resulted from the above-noted
transfer to the Japanese government of the substitutional
portion of Sony's Employee Pension Fund.
Operating income was negatively affected by the recording of
certain provisions for outstanding claims, partially offset by
the reversal of a portion of provisions related to the
resolution of certain prior patent claims recorded in prior
periods.
Income before income taxes declined 64.4% compared to the
previous fiscal year due to the net effect of other income and
expenses, which was Y29.6 billion lower compared to the previous
fiscal year, in addition to the above-mentioned decrease in
operating income. The lower net effect of other income and
expenses was primarily a result of a decrease in the gain on
change in ownership interests in subsidiaries and investees and
an increase in the amount of net foreign currency exchange
losses. During the current fiscal year, a Y31.5 billion ($266
million) gain was recorded from the sale of a portion of stock
in StylingLife Holdings Inc. ("StylingLife"). However, the total
gain on change in ownership interests declined as Sony recorded
a gain on change in interest of Y60.8 billion in the previous
fiscal year resulting from the initial public offering of So-net
Entertainment Corporation ("So-net"), and the sale of a portion
of stock held in both Monex Beans Holdings, Inc., and So-net M3
Inc., a consolidated subsidiary of So-net.
Income taxes: During the current fiscal year, Sony recorded
Y53.9 billion ($457 million) of income taxes at an effective tax
rate of 52.8%. This effective tax rate exceeded the Japanese
statutory tax rate as a result of a reduction in reversals to
income tax expense, which was primarily due to the recording of
losses by certain overseas subsidiaries with tax rates that are
lower than the rate in Japan. The effective tax rate was 61.6%
in the previous fiscal year and exceeded the Japanese statutory
tax rate 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 by these entities and the recording of
an additional tax provision for the undistributed earnings of
overseas subsidiaries.
Equity in net income of affiliated companies increased by
approximately six times to Y78.7 billion ($667 million). Equity
in net income of affiliated companies reported for Sony Ericsson
Mobile Communications AB ("Sony Ericsson") was Y85.3 billion
($723 million), an increase of Y56.3 billion compared to the
previous fiscal year. Sony recorded equity in net income of Y5.0
billion ($43 million) for SONY BMG MUSIC ENTERTAINMENT ("SONY
BMG"), a decrease of Y0.8 billion compared to the previous
fiscal year. Sony recorded equity in net income of Y6.4 billion
($54 million) (before the elimination of unrealized intercompany
profits of Y1.4 billion), a Y13.6 billion improvement compared
to the prior fiscal year, for S-LCD Corporation ("S-LCD"), a
joint-venture with Samsung Electronics Co., Ltd. for the
manufacture of amorphous TFT LCD panels. Sony recorded equity in
net loss of Y18.9 billion ($160 million) for Metro-Goldwyn-Mayer
Inc. ("MGM")*, an increase in the amount of equity in net loss
of Y2.0 billion compared to the previous fiscal year. The equity
in net loss for MGM includes a non-cash interest expense of Y9.6
billion ($81 million) on cumulative preferred stock compared to
the Y6.0 billion of non-cash interest expense on cumulative
preferred stock recorded in the previous fiscal year.
*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.
As a result, net income of Y126.3 billion ($1,071 million) was
recorded, an increase of 2.2% compared to the previous fiscal
year.
Operating Performance Highlights by Business Segment
----------------------------------------------------
"Sales and operating revenue" in each business segment
represents sales and operating revenue recorded before
intersegment transactions are eliminated. "Operating income
(loss)" in each business segment represents operating income
(loss) recorded before intersegment transactions and unallocated
corporate expenses are eliminated.
Electronics
-----------
(Billions of yen, millions of U.S. dollars)
Fiscal Year ended March 31
2006 2007 Change 2007
in Yen
---------- ------ ------ ------ ------
Sales and operating Y5,176.4 Y6,050.5 +16.9% $51,275
revenue
Operating income 6.9 156.7 +2,167.4 1,328
Unless otherwise specified, all amounts are reported on a U.S.
GAAP basis.
Sales increased by 16.9% compared to the previous fiscal year (a
12% increase on a local currency basis). Sales to outside
customers increased 13.4% compared to the previous fiscal year.
There was an increase in sales of products including "BRAVIA"
LCD televisions, which experienced favorable sales in all
regions, "VAIO" PCs, where favorable sales of notebook PCs were
recorded outside of Japan, as well as "Cyber-shot" digital
cameras, which saw increased sales in all regions. However, this
increase was partially offset by a decrease in sales of CRT
televisions, where the market continues to shrink. Intersegment
transactions increased substantially, primarily as a result of
the increased sales of semiconductors to the Game segment.
Operating income increased by Y149.8 billion compared with the
previous fiscal year. Despite the recording of a Y51.2 billion
($434 million) provision in the second quarter for charges
related to the notebook computer battery pack recalls and
subsequent global replacement program, operating income
increased significantly primarily as a result of an increase in
sales to outside customers and a positive impact from the
depreciation of the yen versus the U.S. dollar and the Euro. In
the previous fiscal year, a Y64.5 billion gain was recorded as a
result of the transfer to the Japanese government of the
substitutional portion of Sony's Employee Pension Fund. With
regard to products within the Electronics segment, "Cyber-shot"
digital cameras and "BRAVIA" LCD televisions, which experienced
favorable sales, and "Handycam(R)" video cameras, which
experienced an increase in sales of high value-added models,
contributed to the increase in the operating income of the
segment.
Inventory, as of March 31, 2007, was Y725.8 billion ($6,151
million), a Y60.0 billion, or 9.0%, increase compared with the
level as of March 31, 2006 and a Y125.8 billion, or 14.8%,
decrease compared with the level as of December 31, 2006.
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. The
operating results for 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.
(Millions of Euros)
Year ended March 31
2006 2007 Change in
Euros
---------- ------ ------ ------
Sales and operating EUR7,972 EUR11,892 +49%
revenue
Income before income 593 1,509 +154
taxes
Net income 427 1,142 +168
Sales for the one-year period ended March 31, 2007 increased by
49% compared to the previous year. Results were boosted by sales
of hit models such as "Walkman(R)" and "Cyber-shot" phones. As a
result, Sony recorded equity in net income of Y85.3 billion ($723
million).
Game
----
(Billions of yen, millions of U.S. dollars)
Fiscal Year ended March 31
2006 2007 Change 2007
in Yen
---------- ------ ------ ------ ------
Sales and operating Y958.6 Y1,016.8 +6.1% $8,617
revenue
Operating income 8.7 (232.3) - (1,969)
(loss)
Unless otherwise specified, all amounts are reported on a U.S. GAAP
basis.
Sales increased 6.1% compared with the previous fiscal year (a 2%
increase on a local currency basis).
Hardware: Overall sales increased as a result of the launch of PS3
in Japan, North America, and Europe. However, the sales of
PlayStation(R)2 ("PS2") and PSP(R) (PlayStation(R)Portable)
("PSP") declined due to lower unit sales compared with the
previous fiscal year, and also because of a price reduction of the
PS2.
Software: Despite an increase in PSP software sales compared to
the previous fiscal year, as well as the contribution from PS3
software sales, overall software sales decreased as a result of
lower PS2 software sales.
An operating loss of Y232.3 billion ($1,969 million) was recorded
compared to the Y8.7 billion of operating income recorded in the
previous fiscal year. This deterioration was primarily the result
of the loss arising from the sale of PS3 at strategic price points
lower than its production cost during the introductory period, as
well as the recording of other charges in association with
preparation for the launch of the PS3 platform. In addition,
operating income from the PS2 business declined due to a decrease
in software sales, while operating income from the PSP business
increased primarily due to continued cost reductions in hardware
production.
Worldwide hardware production shipments* (decrease compared to the
previous fiscal year):
-> PS2: 14.20 million units (a decrease of 2.02 million units)
-> PSP: 8.36 million units (a decrease of 5.70 million units)
-> PS3: 5.50 million units
Worldwide software production shipments* (increase/decrease
compared to the previous fiscal year):
-> PS2: 193 million units (a decrease of 30 million units)
-> PSP: 54.1 million units (an increase of 12.5 million units)
-> PS3: 13.2 million units
*Production shipments of hardware and software units 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, 2007, was Y198.8 billion ($1,685
million), a Y87.3 billion, or 78.4%, increase compared with the
level as of March 31, 2006. Inventory increased by Y95.6 billion,
or 92.6%, compared with the level as of December 31, 2006. These
increases are primarily due to the launch of PS3 in Japan, North
America, and Europe during the current fiscal year.
Pictures
--------
(Billions of yen, millions of U.S. dollars)
Fiscal Year ended March 31
2006 2007 Change in 2007
Yen
---------- ------ ------ ------ ------
Sales and operating Y745.9 Y966.3 +29.5% $8,189
revenue
Operating income 27.4 42.7 +55.7 362
Unless otherwise specified, all amounts are reported on a U.S.
GAAP basis. The results presented above are a yen-translation of
the results of Sony Pictures Entertainment ("SPE"), a U.S. based
operation which consolidates the results of its worldwide
subsidiaries. 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 29.5% compared with the previous fiscal year (a
26% increase on a U.S. dollar basis). Motion picture sales
increased significantly due to higher worldwide theatrical and
home entertainment revenue from films released in the current
fiscal year, as compared to those released in the previous fiscal
year. Major films released in the year that contributed to both
theatrical and home entertainment revenue included The Da Vinci
Code, Casino Royale, Click, Talladega Nights: The Ballad of Ricky
Bobby and The Pursuit of Happyness. Television revenue also
increased during this fiscal year, primarily as a result of higher
advertising and subscription sales from several international
channels.
Operating income increased Y15.3 billion to Y42.7 billion ($362
million), compared with the previous fiscal year. The increase is
due to the substantially higher revenue from films released in the
current fiscal year as discussed above. Partially offsetting this
increase, the operating performance of the television business
decreased primarily due to the recording of production and
marketing expenses in the current fiscal year associated with
several new network and made-for-syndication television shows,
combined with the absence of a licensing agreement extension for
Wheel of Fortune, which was recognized in the prior fiscal year.
Financial Services
------------------
(Billions of yen, millions of U.S. dollars)
Fiscal Year ended March 31
2006 2007 Change 2007
in Yen
---------- ------ ------ ------ ------
Financial service Y743.2 Y649.3 -12.6% $5,502
revenue
Operating income 188.3 84.1 -55.3 713
Unless otherwise specified, all amounts are reported on a U.S.
GAAP basis. Therefore, they differ from the results that Sony
Life discloses on a Japanese statutory basis.
Financial service revenue decreased 12.6% compared with the
previous fiscal year due to a decrease in revenue at Sony Life.
Although revenue from insurance premiums increased at Sony Life
reflecting an increase in insurance-in-force, revenue at Sony
Life decreased by Y100.0 billion or 15.5% to Y545.1 billion
($4,619 million), primarily due to lower valuation gains in the
general account and the separate account compared to the
previous fiscal year, when there was a significant increase in
the Japanese stock market.
Operating income decreased by 55.3% compared with the previous
fiscal year due to a decrease in operating income at Sony Life.
Despite an increase in insurance premium revenue, operating
income at Sony Life declined by Y106.8 billion or 56.7%,
compared to the previous fiscal year, to Y81.7 billion ($692
million). This decline was principally due to a decrease in
valuation gains from investments in the general account,
including valuation gains from convertible bonds, reflecting the
above-mentioned Japanese stock market conditions.
All Other
---------
(Billions of yen, millions of U.S. dollars)
Fiscal Year ended March 31
2006 2007 Change 2007
in Yen
---------- ------ ------ ------ ------
Sales and operating Y426.0 Y377.6 -11.4% $3,200
revenue
Operating income 20.5 32.4 +57.9 275
Unless otherwise specified, all amounts are reported on a U.S.
GAAP basis.
Sales decreased 11.4% compared with the previous fiscal year.
This decrease in sales mainly reflects the deconsolidation of
StylingLife, a holding company comprised of six of Sony's retail
businesses, following the sale of a majority interest in the
stock of the company during the first quarter of the current
fiscal year, and a decline in sales at Sony Music Entertainment
(Japan) Inc. ("SMEJ").
Sales at SMEJ declined mainly due to lower intersegment sales in
association with the transfer of business activity relating to
Sony's disc custom press business, which was carried out at SMEJ
during the previous fiscal year, from SMEJ to other segments
within the Sony Group. Best selling albums during the fiscal
year included CHEMISTRY's ALL THE BEST, Yuna Ito's HEART and
Angela Aki's HOME.
Operating income of Y32.4 billion ($275 million) was recorded,
an increase of 57.9% compared with the previous fiscal year.
This improvement in operating income was mainly due to a loss
recorded in the previous fiscal year as the result of a write
down of assets attributed to the asset impairment reflected upon
the sale of a U.S. entertainment complex. Operating income at
SMEJ declined compared to the previous fiscal year mainly due to
a decrease in album and single sales and the recording of a gain
in the previous fiscal year resulting from the transfer to the
Japanese government of the substitutional portion of Sony's
Employee Pension Fund.
Operating income at So-net increased in association with greater
revenue relating to an increase in fiber optic service
subscribers.
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. The
operating results of Sony BMG discussed below are reported on a
U.S. GAAP basis. Sony records the operating results of SONY BMG
in the equity in net income (loss) of affiliated companies line
item in the consolidated statements of income.
(Millions of U.S. dollars)
Year ended March 31
2006 2007 Change in
U.S. Dollars
---------- ------ ------ ------
Sales and operating $4,283 $4,101 -4.2%
revenue
Income before income 150 135 -10.0
taxes
Net income 95 84 -11.5
During the one-year period ended March 31, 2007, sales revenue
at SONY BMG decreased by 4.2% compared to the previous year
primarily due to the accelerated decline in the worldwide
physical music market not being entirely offset by growth in
digital product sales. Income before income taxes decreased by
10.0% compared to the previous year as a result of the decrease
in sales; however, this was partially offset by the favorable
impact of an industry-related legal settlement, a year-on-year
reduction in restructuring charges of $45 million and reductions
in overhead costs from continued restructuring. As a result,
Sony recorded equity in net income of Y5.0 billion ($43
million). Best selling albums during the year included Justin
Timberlake's FutureSex/LoveSounds, Beyonce's B'Day, Il Divo's
Siempre and Christina Aguilera's Back to Basics.
Cash Flow
---------
The following charts show Sony's unaudited condensed statements
of cash flow 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 2006 2007 Change 2007
in Yen
---------- ------ ------ ------ ------
- From operating Y252.0 Y305.6 Y+53.6 $2,590
activities
- From investing (296.4) (431.1) -134.7 (3,653)
activities
- From financing 74.6 59.6 -15.0 505
activities
Cash and cash 519.7 585.5 +65.7 4,961
equivalents at
beginning of the
fiscal year
Cash and cash 585.5 522.9 -62.6 4,431
equivalents at end
of the fiscal year
Operating Activities: During the fiscal year ended March 31,
2007, despite an increase in inventory mainly in the Electronics
and Game segments, net cash was generated primarily due to the
contribution of net income after taking account of depreciation
and amortization. Although notes and accounts receivable
increased significantly, this increase was exceeded by an
increase in notes and accounts payable.
Investing Activities: During the fiscal year ended March 31,
2007, cash was generated primarily from the sale of a majority
of Sony's holding in StylingLife, pursuant to Sony's planned
gradual reduction in its stake in the company. Cash was used by
Sony within the Electronics segment primarily for the purchase
of fixed assets, principally semiconductor manufacturing
facilities, and part of the additional investment in S-LCD with
respect to manufacturing facilities for 8th generation TFT LCD
panels.
As a result, the total amount of cash flow from operating
activities and from investing activities during the
fiscal year ended March 31, 2007 was a use of cash of Y125.5
billion ($1,064 million).
Financing Activities: During the fiscal year ended March 31,
2007, although Sony redeemed a portion of its long-term debt
including bonds and used cash to make dividend payments,
financing was carried out through syndicated bank loans.
Cash and Cash Equivalents: As a result of the above factors, and
taking into account the effect of foreign currency exchange rate
fluctuations, the total balance of cash and cash equivalents
decreased Y62.6 billion compared to March 31, 2006 to Y522.9
billion ($4,431 million) as of March 31, 2007.
Cash Flow - Financial Services segment
--------------------------------------
(Billions of yen, millions of U.S. dollars)
Fiscal Year ended March 31
Cash flow 2006 2007 Change 2007
in Yen
---------- ------ ------ ------ ------
- From operating Y147.1 Y256.5 Y+109.4 $2,174
activities
- From investing (563.8) (276.7) +287.0 (2,345)
activities
- From financing 274.9 179.6 -95.2 1,522
activities
Cash and cash 259.4 117.6 -141.7 997
equivalents at
beginning of the
fiscal year
Cash and cash 117.6 277.0 +159.4 2,348
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, primarily reflecting an increase in insurance-in-force
at Sony Life.
Investing Activities: Sony Life carried out investments
primarily in Japanese fixed income securities.
Financing Activities: Despite a decrease in the balance of call
money within the banking business, 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, cash and
cash equivalents increased Y159.4 billion compared to March 31,
2006 to Y277.0 billion ($2,348 million) as of March 31, 2007.
Consolidated Results for the Fourth Quarter ended March 31, 2007
----------------------------------------------------------------
Sales were Y2,089.6 billion ($17,709 million), an increase of
12.6% (a 9% increase on a local currency basis) compared with
the same quarter of the previous fiscal year.
In the Electronics segment, overall sales increased significantly
due to increased sales to outside customers and a substantial
increase in intersegment sales to the Game segment. Sales
primarily of "BRAVIA" LCD televisions, "VAIO" PCs and
"Handycam(R)" video cameras increased, while sales of LCD rear
projection televisions and CRT televisions decreased. In the Game
segment, despite a decrease in sales from the PS2 and PSP
businesses, there was a significant increase in overall sales as
a result of the launch of the PS3. In the Pictures segment,
revenue increased primarily due to higher worldwide home
entertainment revenue from current year films including Casino
Royale and The Pursuit of Happyness. In the Financial Services
segment, revenue decreased mainly due to a decrease in valuation
gains in the general account and the separate account at Sony Life.
An operating loss of Y113.4 billion ($961 million) was recorded,
a deterioration of Y61.5 billion from the same quarter of the
previous fiscal year. In the Electronics segment, although the
cost to sales ratio was negatively affected by severe price
competition, the amount of loss decreased mainly as a result of
a an increase in sales and a reduction in restructuring charges.
The Game segment recorded a significant operating loss in the
quarter mainly due to the sale of PS3 at strategic price points
lower than its production cost during the introductory period.
Operating income for the Pictures segment increased due to the
higher revenue from current year films noted above, partially
offset by the absence of a licensing agreement extension for
Wheel of Fortune which was recognized in the fourth quarter of
the prior fiscal year. Operating income within the Financial
Services segment declined due to a decrease in valuation gains
in the general account noted above.
Restructuring charges, which are recorded as operating expenses,
for the fourth quarter amounted to Y23.1 billion ($196 million)
compared to Y75.3 billion in the same quarter of the previous
fiscal year. In the Electronics segment, restructuring charges
were Y22.5 billion ($191 million) compared to Y63.4 billion in
the same quarter of the previous fiscal year.
The loss before income taxes was Y105.7 billion ($896 million),
a Y57.8 billion deterioration compared to the same quarter of
the previous fiscal year.
Income taxes: Sony recorded a Y24.9 billion ($211 million)
reversal to income tax expense mainly as a result of a loss
recorded in the fourth quarter of the fiscal year.
Equity in net income of affiliated companies of Y12.3 billion
($104 million) was recorded, a Y6.9 billion yen increase
compared to the same quarter of the previous fiscal year. Sony
Ericsson, with strong sales of "Walkman(R)" phones, contributed
Y19.7 billion ($167 million) to equity in net income, a Y12.1
billion increase compared to the same quarter of the previous
fiscal year. In addition, Y2.0 billion ($16 million) of equity
in net income (before the elimination of unrealized intercompany
profits of Y0.1 billion) was recorded for S-LCD, a Y0.3 billion
decrease compared to the same quarter of the previous fiscal
year. An equity in net loss of Y1.3 billion ($11 million) was
recorded for SONY BMG, a deterioration of Y1.0 billion compared
to the same quarter of the previous fiscal year. In addition,
Sony recorded an equity in net loss of approximately Y8.2
billion ($69 million) for MGM, an increase in the amount of
equity loss of Y4.6 billion compared to the same quarter of the
previous fiscal year.
As a result, a net loss of Y67.6 billion ($573 million) was
recorded, a Y1.0 billion deterioration compared to the same
quarter of the previous fiscal year.
Notes
-----
Note I: During the fiscal year ended March 31, 2007, the average
value of the yen was Y116.0 against the U.S. dollar and Y148.6
against the Euro, which was 3.2% lower against the U.S. dollar
and 8.2% lower against the Euro, compared with the average rates
for the previous fiscal year. Operating results 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: During the quarter ended March 31, 2007, the average
value of the yen was Y118.5 against the U.S. dollar and Y155.0
against the Euro, which was 2.2% lower against the U.S. dollar
and 10.2% 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.
On May 15, 2007, a year-end cash dividend of Y12.5 ($0.11) per
share (the same as the amount paid in the previous fiscal year)
payable as of June 1, 2007 was approved by the Board of
Directors. 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 ($0.21).
Number of Employees
-------------------
The number of employees at the end of March 2007 was
approximately 163,000, an increase of approximately 4,500
employees from the end of March 2006. Although there was a
reduction in employees associated with the deconsolidation of
StylingLife and restructuring at a number of manufacturing
facilities, the total number of employees increased as a result
of a significant increase of employees at manufacturing
facilities in East Asia.
Outlook for the Fiscal Year ending March 31, 2008
-------------------------------------------------
Change from previous
fiscal year
Sales and operating revenue Y8,780 billion +6%
Operating income 440 billion +513
Income before income taxes 420 billion +312
Equity in net income of affiliated companies 80 billion +2
Net income 320 billion +153
Capital expenditures (additions to fixed assets)* Y440 billion +6
Depreciation and amortization** 430 billion +7
(Depreciation expenses for tangible assets) (350 billion) (+11)
Research and development expenses 550 billion +1
*Investments in S-LCD are not included within the forecast for
capital expenditures.
**The forecast for depreciation and amortization includes
amortization of intangible assets and amortization of deferred
insurance acquisition costs.
Assumed foreign currency exchange rates: approximately Y115 to
the U.S. dollar and approximately Y150 to the Euro.
Forecasted consolidated operating results above have been
prepared based on the current business environment and reflect
the factors noted below.
The above forecast includes restructuring charges, recorded as
operating expenses, of approximately Y35 billion expected to be
incurred across the Sony Group during the fiscal year, primarily
within the Electronics segment, compared to Y38.8 billion of
restructuring charges recorded during the fiscal year ended
March 31, 2007.
A gain on the sale of a portion of the site of Sony's former
headquarters of approximately Y59.0 billion is expected during
the fiscal year, compared to Y21.7 billion recorded during the
fiscal year ended March 31, 2007. The gain is included in the
operating income forecast above.
With regard to equity in net income of affiliated companies, MGM
is expected to have no effect on equity in net income during the
fiscal year ending March 31, 2008, due to the fact that Sony no
longer has any book basis in MGM as of March 31, 2007. Equity in
net loss for S-LCD is expected for the fiscal year ending March
31, 2008, due to the start of production on the 8th generation
TFT LCD panel line.
The forecast for each business segment is as follows:
Electronics
-----------
Sales are expected to increase primarily due to increased sales
of LCD televisions and semiconductors including those for use
within the Game segment. Operating income is expected to
increase significantly due to an improvement in operating
performance for televisions and semiconductors and the absence
of a Y51.2 billion provision recorded in the fiscal year ended
March 31, 2007 that relates to charges incurred as a result of
the recalls of notebook computer battery packs and the
subsequent global replacement program.
Capital expenditures within the semiconductor business during
the fiscal year ending March 31, 2008, are expected to amount to
approximately Y130.0 billion (the actual amount for the fiscal
year ended March 31, 2007 was approximately Y150.0 billion).
Game
----
An increase in sales is anticipated as a result of the
full-scale expansion of the PS3 business in Japan, the United
States and Europe. In addition, a significant reduction in
operating loss is expected due to rapid reductions in hardware
production costs and an enhanced line-up of software titles in
the PS3 business.
Pictures
--------
Despite an expected decrease in sales resulting from fewer film
releases, operating income is expected to significantly
increase, mainly due to the carryover performance of the prior
fiscal year's release slate and higher home entertainment and
international television sales of motion picture library
product.
Financial Services
------------------
Although the effect of gains and losses on investments
associated with stock market fluctuations in Japan are not
incorporated within the forecast for the fiscal year ending
March 31, 2008, we anticipate both an increase in revenue and
operating income within the segment primarily due to an
expansion in business at Sony Life.
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," "aim," "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, as well as achieve
sufficient cost reductions for, its products and services
including newly introduced platforms within the Game segment,
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 recoup large-scale
investment required for technology development and increasing
production capacity; (v) Sony's ability to implement
successfully personnel reduction and other business
reorganization activities in its Electronics segment; (vi)
Sony's ability to implement successfully its network strategy
for its Electronics, Game and Pictures segments and All Other,
including 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; (vii) 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); (viii)
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 (ix)
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
revenue 2006 2007 Change 2007
----------- ------ ------ ------ ------
Electronics
Customers Y 4,782,173 Y 5,421,384 +13.4 % $ 45,944
Intersegment 394,206 629,087 5,331
----------- ------ ------ ------
Total 5,176,379 6,050,471 +16.9 51,275
Game
Customers 918,252 974,218 +6.1 8,256
Intersegment 40,368 42,571 361
----------- ------ ------ ------
Total 958,620 1,016,789 +6.1 8,617
Pictures
Customers 745,859 966,260 +29.5 8,189
Intersegment - - -
----------- ------ ------ ------
Total 745,859 966,260 +29.5 8,189
Financial Services
Customers 720,566 624,282 -13.4 5,291
Intersegment 22,649 25,059 212
----------- ------ ------ ------
Total 743,215 649,341 -12.6 5,503
All Other
Customers 343,747 309,551 -9.9 2,623
Intersegment 82,297 68,087 577
----------- ------ ------ ------
Total 426,044 377,638 -11.4 3,200
Elimination (539,520) (764,804) - (6,481)
----------- ------ ------ ------
Consolidated total Y 7,510,597 Y 8,295,695 +10.5 % $ 70,303
Electronics intersegment amounts primarily consist of transactions
with the Game segment, Pictures segment and All Other.
All Other intersegment amounts primarily consist of transactions with
the Electronics and Game segments.
Operating income (loss) 2006 2007 Change 2007
----------- ------ ------ ------ ------
Electronics Y 6,913 Y 156,745 +2,167.4 % $ 1,328
Game 8,748 (232,325) - (1,969)
Pictures 27,436 42,708 +55.7 362
Financial Services 188,323 84,142 -55.3 713
All Other 20,525 32,417 +57.9 275
----------- ------ ------ ------
Total 251,945 83,687 -66.8 709
Corporate and (25,529) (11,937) - (101)
elimination
----------- ------ ------ ------
Consolidated total Y 226,416 Y 71,750 -68.3 % $ 608
(Millions of yen, millions of U.S. dollars)
Fourth quarter ended March 31
(Unaudited)
Sales and operating
revenue 2006 2007 Change 2007
----------- ------ ------ ------ ------
Electronics
Customers Y 1,168,170 Y 1,274,137 +9.1 % $ 10,798
Intersegment 55,013 253,349 2,147
----------- ------ ------ ------
Total 1,223,183 1,527,486 +24.9 12,945
Game
Customers 145,856 270,290 +85.3 2,291
Intersegment 6,494 10,891 92
----------- ------ ------ ------
Total 152,350 281,181 +84.6 2,383
Pictures
Customers 240,382 286,401 +19.1 2,427
Intersegment - - -
----------- ------ ------ ------
Total 240,382 286,401 +19.1 2,427
Financial Services
Customers 217,289 176,484 -18.8 1,496
Intersegment 5,839 7,745 66
----------- ------ ------ ------
Total 223,128 184,229 -17.4 1,562
All Other
Customers 84,047 82,293 -2.1 697
Intersegment 22,568 17,193 146
----------- ------ ------ ------
Total 106,615 99,486 -6.7 843
Elimination (89,914) (289,178) - (2,451)
----------- ------ ------ ------
Consolidated total Y 1,855,744 Y 2,089,605 +12.6 % $ 17,709
Electronics intersegment amounts primarily consist of transactions
with the Game segment, Pictures segment and All Other.
All Other intersegment amounts primarily consist of transactions with
the Electronics and Game segments.
Operating income (loss) 2006 2007 Change 2007
----------- ------ ------ ------ ------
Electronics Y (81,562) Y (74,135) - % $ (628)
Game (61,396) (107,827) - (914)
Pictures 30,201 32,912 +9.0 279
Financial Services 79,306 29,526 -62.8 250
All Other (8,948) 5,446 - 46
----------- ------ ------ ------
Total (42,399) (114,078) - (967)
Corporate and (9,503) 706 - 6
elimination
----------- ------ ------ ------
Consolidated total Y (51,902) Y (113,372) - % $ (961)
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 2006 2007 Change 2007
----------- ------ ------ ------ ------
Audio Y 536,187 Y 522,879 -2.5 % $ 4,431
Video 1,021,325 1,143,120 +11.9 9,687
Televisions 927,769 1,226,971 +32.2 10,398
Information and 842,537 950,461 +12.8 8,055
Communications
Semiconductors 172,249 205,757 +19.5 1,744
Components 800,716 852,981 +6.5 7,229
Other 481,390 519,215 +7.9 4,400
----------- ------ ------ ------
Total Y 4,782,173 Y 5,421,384 +13.4 % $ 45,944
Fourth quarter ended March 31 (Unaudited)
Sales and operating
revenue 2006 2007 Change 2007
----------- ------ ------ ------ ------
Audio Y 104,684 Y 110,243 +5.3 % $ 934
Video 209,284 234,586 +12.1 1,988
Televisions 247,044 292,614 +18.4 2,480
Information and 253,220 263,464 +4.0 2,233
Communications
Semiconductors 44,647 53,085 +18.9 450
Components 198,203 199,322 +0.6 1,689
Other 111,088 120,823 +8.8 1,024
----------- ------ ------ ------
Total Y 1,168,170 Y 1,274,137 +9.1 % $ 10,798
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.
Commencing April 1, 2006, 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
------------ ------------------------- --------------------
Low-temperature "Semiconductors" -> "Components"
polysilicon
thin film
transistor LCD
Chemical component "Other" -> "Components"
Geographic Segment Information
------------------------------
(Millions of yen, millions of U.S. dollars)
Fiscal year ended March 31
Sales and operating
revenue 2006 2007 Change 2007
----------- ------ ------ ------ ------
Japan Y 2,203,812 Y 2,127,841 -3.4 % $ 18,033
United States 1,957,644 2,232,453 +14.0 18,919
Europe 1,715,775 2,037,658 +18.8 17,268
Other Areas 1,633,366 1,897,743 +16.2 16,083
----------- ------ ------ ------
Total Y 7,510,597 Y 8,295,695 +10.5 % $ 70,303
Fourth quarter ended March 31 (Unaudited)
Sales and operating
revenue 2006 2007 Change 2007
----------- ------ ------ ------ ------
Japan Y 596,379 Y 544,476 -8.7 % $ 4,614
United States 443,644 541,416 +22.0 4,589
Europe 396,259 539,385 +36.1 4,571
Other Areas 419,462 464,328 +10.7 3,935
----------- ------ ------ ------
Total Y 1,855,744 Y 2,089,605 +12.6 % $ 17,709
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
Sales and operating
revenue: 2006 2007 Change 2007
----------- ------ ------ ------ ------
%
Net sales Y 6,692,776 Y 7,567,359 $ 64,130
Financial service 720,566 624,282 5,291
revenue
Other operating 97,255 104,054 882
revenue
------ ------ ------
7,510,597 8,295,695 +10.5 70,303
Costs and expenses:
Cost of sales 5,151,397 5,889,601 49,912
Selling, general 1,527,036 1,788,427 15,156
and administrative
Financial service 531,809 540,097 4,577
expenses
Loss on sale, 73,939 5,820 50
disposal or
impairment of
assets, net
------ ------ ------
7,284,181 8,223,945 69,695
Operating income 226,416 71,750 -68.3 608
Other income:
Interest and 24,937 28,240 239
dividends
Gain on sale 9,645 14,695 125
of securities
investments, net
Gain on change in 60,834 31,509 267
interest in
subsidiaries and
equity investees
Other 23,039 20,738 176
------ ------ ------
118,455 95,182 807
Other expenses:
Interest 28,996 27,278 231
Loss on devaluation 3,878 1,308 11
of securities
investments
Foreign exchange 3,065 18,835 160
loss, net
Other 22,603 17,474 148
------ ------ ------
58,542 64,895 550
------ ------ ------
Income before income 286,329 102,037 -64.4 865
taxes
Income taxes 176,515 53,888 457
------ ------ ------
Income before minority 109,814 48,149 -56.2 408
interest and equity
in net income of
affiliated companies
Minority interest in (626) 475 4
income (loss) of
consolidated
subsidiaries
Equity in net income 13,176 78,654 667
of affiliated
companies
------ ------ ------
Net income Y 123,616 Y 126,328 +2.2 $ 1,071
------ ------ ------
Per share data:
Net income
- Basic Y 122.58 Y 126.15 +2.9 $ 1.07
- Diluted 116.88 120.29 +2.9 1.02
(Millions of yen, millions of U.S. dollars, except per share amounts)
Fourth quarter ended March 31
(Unaudited)
Sales and operating
revenue: 2006 2007 Change 2007
----------- ------ ------ ------ ------
%
Net sales Y 1,612,012 Y 1,886,791 $ 15,990
Financial service 217,289 176,484 1,496
revenue
Other operating 26,443 26,330 223
revenue
------ ------ ------
1,855,744 2,089,605 +12.6 17,709
Costs and expenses:
Cost of sales 1,300,497 1,570,938 13,313
Selling, general and 430,004 484,944 4,110
administrative
Financial service 137,607 146,902 1,245
expenses
Loss on sale, 39,538 193 2
disposal or
impairment of
assets, net
------ ------ ------
1,907,646 2,202,977 18,670
Operating income (loss) (51,902) (113,372) - (961)
Other income:
Interest and 7,461 10,384 88
dividends
Foreign exchange 224 - -
gain, net
Gain on sale 798 5,376 46
of securities
investments, net
Gain on change in 3,357 57 0
interest in
subsidiaries and
equity investees
Other 6,959 7,774 66
------ ------ ------
18,799 23,591 200
Other expenses:
Interest 9,032 6,829 58
Loss on devaluation 763 264 2
of securities
investments
Foreign exchange - 5,032 43
loss, net
Other 4,965 3,778 32
------ ------ ------
14,760 15,903 135
------ ------ ------
Income (loss) before (47,863) (105,684) - (896)
income taxes
Income taxes 23,572 (24,858) (211)
------ ------ ------
Income (loss) before (71,435) (80,826) - (685)
minority interest and
equity in net income
of affiliated companies
Minority interest in 467 (956) (8)
income (loss) of
consolidated
subsidiaries
Equity in net income 5,369 12,310 104
of affiliated
companies
------ ------ ------
Net income (loss) Y (66,533) Y (67,560) - $ (573)
------ ------ ------
Per share data:
Net income (loss)
- Basic Y (66.48) Y (67.44) - $ (0.57)
- Diluted (66.48) (67.44) - (0.57)
Consolidated Balance Sheets
---------------------------
(Millions of yen, millions of U.S. dollars)
March March March
31 31 31
ASSETS 2006 2007 2007
--------- --------- ---------
Current assets:
Cash and cash Y 703,098 Y 799,899 $ 6,779
equivalents
Marketable 536,968 493,315 4,181
securities
Notes and accounts 1,075,071 1,490,452 12,631
receivable, trade
Allowance for doubtful (89,563) (120,675) (1,023)
accounts and sales
returns
Inventories 804,724 940,875 7,974
Deferred income 221,311 243,782 2,066
taxes
Prepaid expenses 517,915 699,075 5,924
and other current
assets
--------- --------- ---------
3,769,524 4,546,723 38,532
Film costs 360,372 308,694 2,616
Investments and
advances:
Affiliated 285,870 448,169 3,798
companies
Securities 3,234,037 3,440,567 29,157
investments and
other
--------- --------- ---------
3,519,907 3,888,736 32,955
Property, plant and
equipment:
Land 178,844 167,493 1,419
Buildings 926,783 978,680 8,294
Machinery and 2,327,676 2,479,308 21,011
equipment
Construction in 116,149 64,855 550
progress
Less-Accumulated (2,160,905) (2,268,805) (19,227)
depreciation
--------- --------- ---------
1,388,547 1,421,531 12,047
Other assets:
Intangibles, net 207,034 233,255 1,977
Goodwill 299,024 304,669 2,582
Deferred insurance 383,156 394,117 3,340
acquisition costs
Deferred income 178,751 216,997 1,839
taxes
Other 501,438 401,640 3,403
--------- --------- ---------
1,569,403 1,550,678 13,141
--------- --------- ---------
Y10,607,753 Y11,716,362 $ 99,291
--------- --------- ---------
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Short-term Y 142,766 Y 52,291 $ 443
borrowings
Current portion of 193,555 43,170 366
long-term debt
Notes and accounts 813,332 1,179,694 9,997
payable, trade
Accounts payable, 854,886 968,757 8,210
other and accrued
expenses
Accrued income and 87,295 70,286 596
other taxes
Deposits from customers 599,952 752,367 6,376
in the banking business
Other 508,442 485,287 4,112
--------- --------- ---------
3,200,228 3,551,852 30,100
Long-term liabilities:
Long-term debt 764,898 1,001,005 8,483
Accrued pension and 182,247 173,474 1,470
severance costs
Deferred income 216,497 261,102 2,213
taxes
Future insurance 2,744,321 3,037,666 25,743
policy benefits and
other
Other 258,609 281,589 2,387
--------- --------- ---------
4,166,572 4,754,836 40,296
Minority interest in 37,101 38,970 330
consolidated
subsidiaries
Stockholders' equity:
Capital stock 624,124 626,907 5,313
Additional paid-in 1,136,638 1,143,423 9,690
capital
Retained earnings 1,602,654 1,719,506 14,572
Accumulated other (156,437) (115,493) (979)
comprehensive
income
Treasury stock, at (3,127) (3,639) (31)
cost
--------- --------- ---------
3,203,852 3,370,704 28,565
--------- --------- ---------
Y10,607,753 Y11,716,362 $ 99,291
--------- --------- ---------
Consolidated Statements of Changes in Stockholders' Equity (Unaudited)
----------------------------------------------------------
(Millions of yen)
Subsidiary Common Additional Retained Accumulated Treasury Total
tracking stock paid-in earnings other stock, at
stock capital comprehensive cost
income
---------------- ------ ------ ------ ------ ------ ------ ------
Balance at March Y 3,917 Y 617,792 Y 1,134,222 Y 1,506,082 Y (385,675) Y (6,000) Y 2,870,338
31, 2005
Exercise of stock 931 932 1,863
acquisition
rights
Conversion of 1,484 1,484 2,968
convertible bonds
Conversion of (3,917) 3,917 -
subsidiary
tracking stock
Comprehensive
income:
Net income 123,616 123,616
Other
comprehensive
income, net of
tax
Unrealized 38,135 38,135
gains on
securities
Unrealized 441 441
losses on
derivative
instruments
Minimum 50,206 50,206
pension
liability
adjustment
Foreign 140,456 140,456
currency
translation
adjustments
------
Total 352,854
comprehensive ------
income
Stock issue (780) (780)
costs, net of tax
Dividends (24,968) (24,968)
declared
Purchase of (394) (394)
treasury stock
Reissuance of (1,296) 3,267 1,971
treasury stock
---------------- ------ ------ ------ ------ ------ ------ ------
Balance at March Y - Y 624,124 Y 1,136,638 Y 1,602,654 Y (156,437) Y (3,127) Y 3,203,852
31, 2006
Exercise of stock 2,175 2,175 4,350
acquisition
rights
Conversion of 608 608 1,216
convertible bonds
Stock based 3,993 3,993
compensation
Comprehensive
income:
Net income 126,328 126,328
Cumulative effect of an (3,785) (3,785)
accounting change, net of
tax
Other
comprehensive
income, net of
tax
Unrealized (14,708) (14,708)
gains on
securities
Unrealized losses on 974 974
derivative instruments
Minimum (2,754) (2,754)
pension
liability
adjustment
Foreign currency 86,313 86,313
translation
adjustments
------
Total 192,368
comprehensive ------
income
Stock issue (22) (22)
costs, net of tax
Dividends (25,042) (25,042)
declared
Purchase of (558) (558)
treasury stock
Reissuance of 9 46 55
treasury stock
Adoption of SFAS (9,508) (9,508)
No.158
Other 19,373 (19,373) -
---------------- ------ ------ ------ ------ ------ ------ ------
Balance at March Y - Y 626,907 Y 1,143,423 Y 1,719,506 Y (115,493) Y (3,639) Y 3,370,704
31, 2007
---------------- ------ ------ ------ ------ ------ ------ ------
(Millions of U.S. dollars)
Subsidiary Common Additional Retained Accumulated Treasury Total
tracking stock paid-in earnings other stock, at
stock capital comprehensive cost
income
---------------- ------ ------ ------ ------ ------ ------ ------
Balance at March $ - $ 5,289 $ 9,633 $ 13,582 $ (1,326) $ (27) $ 27,151
31, 2006
Exercise of stock 19 18 37
acquisition
rights
Conversion of 5 5 10
convertible bonds
Stock based 34 34
compensation
Comprehensive
income:
Net income 1,071 1,071
Cumulative effect of an (32) (32)
accounting change, net of
tax
Other
comprehensive
income, net of
tax
Unrealized (125) (125)
gains on
securities
Unrealized losses on 8 8
derivative instruments
Minimum (22) (22)
pension
liability
adjustment
Foreign currency 731 731
translation
adjustments
------
Total 1,631
comprehensive ------
income
Stock issue (1) (1)
costs, net of tax
Dividends (212) (212)
declared
Purchase of (4) (4)
treasury stock
Reissuance of 0 0 0
treasury stock
Adoption of SFAS (81) (81)
No.158
Other 164 (164) -
---------------- ------ ------ ------ ------ ------ ------ ------
Balance at March $ - $ 5,313 $ 9,690 $ 14,572 $ (979) $ (31) $ 28,565
31, 2007
---------------- ------ ------ ------ ------ ------ ------ ------
Consolidated Statements of Cash Flows
-------------------------------------
(Millions of yen, millions of U.S. dollars)
Fiscal year ended March 31
2006 2007 2007
------ ------ ------
Cash flows from operating
activities:
Net income Y 123,616 Y 126,328 $ 1,071
Adjustments to reconcile
net income to net cash
provided by operating
activities:
Depreciation and 381,843 400,009 3,390
amortization,
including
amortization of
deferred
insurance
acquisition costs
Amortization 286,655 368,382 3,122
of film
costs
Stock-based 150 3,838 33
compensation
expense
Gain on the (73,472) - -
transfer to the
Japanese
Government of the
substitutional
portion
of employee
pension
fund, net
Loss on 73,939 5,820 50
sale,
disposal or
impairment
of assets,
net
Gain on sale (5,767) (13,387) (114)
or loss on
devaluation
of
securities
investments,
net
Gain on (44,986) (11,857) (100)
evaluation of
marketable
securities held
in the financial
service business
for trading
purpose, net
Gain on (60,834) (31,509) (267)
change in
interest in
subsidiaries
and equity
investees
Deferred 80,115 (13,193) (112)
income taxes
Equity in net 9,794 (68,179) (578)
(income) loss of
affiliated
companies, net of
dividends
Changes in
assets and
liabilities:
(Increase) 17,464 (357,891) (3,033)
decrease in
notes and
accounts
receivable,
trade
Increase in (164,772) (119,202) (1,010)
inventories
Increase in (339,697) (320,079) (2,713)
film costs
Increase - (9,078) 362,079 3,068
decrease- in
notes and
accounts
payable,
trade
Increase - 29,009 (14,396) (122)
decrease- in
accrued
income and
other taxes
Increase in 143,122 172,498 1,462
future
insurance
policy
benefits and
other
Increase in (51,520) (61,563) (522)
deferred
insurance
acquisition
costs
(Increase) (35,346) 31,732 269
decrease in
marketable
securities held
in the financial
service
business for
trading purpose
Increase in (8,792) (35,133) (298)
other
current
assets
Increase in 105,865 76,766 650
other
current
liabilities
Other (57,450) 59,965 508
------ ------ ------
Net cash 399,858 561,028 4,754
provided by
operating
activities
------ ------ ------
Cash flows from
investing activities:
Payments for (462,473) (527,515) (4,470)
purchases of
fixed assets
Proceeds from 38,168 87,319 740
sales of fixed
assets
Payments for (1,368,158) (914,754) (7,752)
investments
and advances
by financial
service
business
Payments for (36,947) (100,152) (849)
investments and
advances (other
than financial
service business)
Proceeds from 857,376 679,772 5,761
maturities of
marketable
securities, sales
of securities
investments and
collections of
advances by
financial service
business
Proceeds from 24,527 22,828 193
maturities of
marketable
securities, sales
of securities
investments and
collections of
advances (other
than financial
service
business)
Proceeds from 75,897 43,157 365
sales of
subsidiaries'
and equity
investees'
stocks
Other 346 (6,085) (51)
------ ------ ------
Net cash (871,264) (715,430) (6,063)
used in
investing
activities
Cash flows from
financing activities:
Proceeds from 246,326 270,780 2,295
issuance of
long-term debt
Payments of (138,773) (182,374) (1,546)
long-term debt
Increase (11,045) 6,096 52
(decrease) in
short-term
borrowings
Increase in 190,320 273,435 2,317
deposits from
customers in
the financial
service
business
Increase (decrease) 86,100 (100,700) (853)
in call money and
bills sold in the
banking business
Dividends paid (24,810) (25,052) (212)
Proceeds from 4,681 5,566 47
issuance of stocks
under stock-based
compensation plans
Proceeds from 6,937 2,217 19
issuance of
stocks by
subsidiaries
Other 128 (2,065) (18)
------ ------ ------
Net cash 359,864 247,903 2,101
provided by
financing
activities
------ ------ ------
Effect of 35,537 3,300 28
exchange rate
changes on cash
and cash
equivalents
------ ------ ------
Net increase (76,005) 96,801 820
(decrease) in
cash and cash
equivalents
Cash and cash 779,103 703,098 5,959
equivalents at
beginning of the
fiscal year
------ ------ ------
Cash and cash Y 703,098 Y 799,899 $ 6,779
equivalents at
end of the fiscal
year
------ ------ ------
(Notes)
1. U.S. dollar amounts have been translated from yen, for
convenience only, at the rate of Y118 = U.S. $1, the approximate
Tokyo foreign exchange market rate as of March 30, 2007.
2. As of March 31, 2007, Sony had 960 consolidated subsidiaries
(including variable interest entities). It has applied the equity
accounting method in respect to 62 affiliated companies.
3. Prior to December 1, 2005, Sony calculated and presented per
share data separately for Sony's common stock and for the
subsidiary tracking stock applying the "two-class" method based
on Statement of Financial Accounting Standards ("FAS") No.128,
"Earnings per Share". 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 has not been presented since the third
quarter of the fiscal year ended March 31, 2006.
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 mainly resulted from convertible bonds.
Weighted-average number
of outstanding shares (Thousands of shares)
----------------------- Fiscal year ended March 31
2006 2007
Net income ------ ------
- Basic 997,781 1,001,403
- Diluted 1,046,164 1,050,171
Weighted-average number
of outstanding shares (Thousands of shares)
----------------------- Fourth quarter ended March 31
2006 2007
Net income (loss) ------ ------
- Basic 1,000,832 1,001,793
- Diluted 1,000,832 1,001,793
4. Effective April 1, 2006, Sony reclassified royalty income as
a component of sales and operating revenue, rather than as a
component of other income as previously recorded. In connection
with this reclassification, sales and operating revenue,
operating income and other income for the fourth quarter and the
fiscal year ended March 31, 2006 have been reclassified to
conform with the presentation of these items for the fourth
quarter and the fiscal year ended March 31, 2007. Royalty income
reclassified from other income to sales and operating revenue for
the fourth quarter and the fiscal year ended March 31, 2006 was
Y10,299 million and Y35,161 million. These amounts were recorded
primarily within the Electronics segment.
5. In December 2004, the Financial Accounting Standards Board
("FASB") issued FAS No. 123 (revised 2004), "Share-Based Payment"
("FAS No. 123(R)"). This statement requires the use of the fair
value based method of accounting for employee stock-based
compensation and eliminates the alternative to use of the
intrinsic value method prescribed by APB No. 25. With limited
exceptions, FAS No. 123(R) requires that the grant-date fair
value of share-based payments to employees be expensed over the
period the service is received. Sony had accounted for its
employee stock-based compensation in accordance with the
intrinsic value method prescribed by APB No. 25 and its related
interpretations and had disclosed the net effect on net income
and net income per share allocated to the common stock if Sony
had applied the fair value recognition provisions of FAS No. 123
to stock-based compensation. Sony adopted FAS No. 123(R) on
April 1, 2006. Sony elected the modified prospective method of
transition prescribed in FAS No. 123(R), which requires that
compensation expense be recorded for all unvested stock
acquisition rights as the requisite service is rendered
beginning with the first period of adoption. As a result of
adoption of FAS No. 123(R), Sony's operating income decreased
Y1,198 million and Y3,670 million for the fourth quarter and the
fiscal year ended March 31, 2007, respectively.
6. In February 2006, the FASB issued FAS No. 155, "Accounting for
Certain Hybrid Financial Instruments", an amendment of FAS No.
133 and FAS No. 140. This statement permits an entity to elect
fair value remeasurement for any hybrid financial instrument if
the hybrid instrument contains an embedded derivative that would
otherwise be required to be bifurcated and accounted for
separately under FAS No. 133. The election to measure the hybrid
instrument at fair value is made on an instrument-by-instrument
basis and is irreversible. The statement is effective for all
financial instruments acquired, issued, or subject to a
remeasurement event occurring after the beginning of an entity's
fiscal years beginning after September 15, 2006, with earlier
adoption permitted as of the beginning of fiscal year, provided
that financial statements for any interim period of that fiscal
year have not been issued. Sony early adopted FAS No. 155 on
April 1, 2006. As a result of adoption of FAS No. 155, Sony's
operating income increased Y3,371 million and Y3,828 million for
the fourth quarter and the fiscal year ended March 31, 2007,
respectively. Additionally, on April 1, 2006, Sony recognized
Y3,785 million of loss (net of income taxes of Y2,148 million)
as a cumulative-effect adjustment to beginning retained
earnings.
7. In September 2006, the FASB issued FAS No.158 "Employers'
Accounting for Defined Benefit Pension and Other Postretirement
Plans", an amendment to FAS No. 87, 88, 106 and 132(R). This
statement requires an employer to recognize the overfunded or
underfunded status of a defined benefit pension and other
postretirement benefit plan as an asset or liability in its
statement of financial position and to recognize changes in that
funded status in the year in which the changes occur through
other comprehensive income. Sony adopted FAS No. 158 on March
31, 2007. This statement also requires companies to measure the
funded status of the plan as of the date of its fiscal year-end,
effective for years ending after December 15, 2008. Sony expects
to adopt the measurement provisions of FAS No.158 effective
March 31, 2009. See Consolidated Statements of Changes in
Stockholders' Equity, for the effect of adopting FAS No. 158 on
Sony's consolidated financial statements.
Other Consolidated Financial Data
(Millions of yen, millions of U.S. dollars)
Fiscal Year ended March 31
2006 2007 Change 2007
------ ------ ------ ------
Capital expenditures Y 384,347 Y 414,138 +7.8% $ 3,510
(additions to property,
plant and equipment)
Depreciation and 381,843 400,009 +4.8 3,390
amortization expenses*
(Depreciation expenses for (310,519) (315,773) +1.7 (2,676)
tangible assets)
R&D expenses 531,795 543,937 +2.3 4,610
Three months ended March 31
2006 2007 Change 2007
------ ------ ------ ------
Capital expenditures Y 122,427 Y 102,093 -16.6% $ 865
(additions to property,
plant and equipment)
Depreciation and 103,584 115,155 +11.2 976
amortization expenses*
(Depreciation expenses for (84,013) (89,804) +6.9 (761)
tangible assets)
R&D expenses 160,370 147,560 -8.0 1,251
* Including amortization expenses for intangible assets and for
deferred insurance acquisition costs
(Condensed Financial Services Financial Statements)
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)
Financial Services Fiscal year ended March 31
2006 2007 Change 2007
------ ------ ------ ------
%
Financial service Y 743,215 Y 649,341 -12.6 $ 5,502
revenue
Financial service 554,892 565,199 +1.9 4,789
expenses
------ ------ ------
Operating income 188,323 84,142 -55.3 713
Other income (expenses), 24,522 9,886 -59.7 84
net
------ ------ ------
Income before income 212,845 94,028 -55.8 797
taxes
Income taxes and 78,527 33,536 -57.3 284
other
------ ------ ------
Net income Y 134,318 Y 60,492 -55.0 $ 513
------ ------ ------
(Millions of yen, millions of U.S. dollars)
Sony without Fiscal year ended March 31
Financial Services 2006 2007 Change 2007
------ ------ ------ ------
%
Net sales and Y6,799,068 Y7,680,578 +13.0 $65,090
operating revenue
Costs and expenses 6,762,194 7,694,375 +13.8 65,207
------ ------ ------
Operating income (loss) 36,874 (13,797) - (117)
Other income (expenses), 36,610 27,917 -23.7 237
net
------ ------ ------
Income before income 73,484 14,120 -80.8 120
taxes
Income taxes and 84,186 (57,991) - (491)
other
------ ------ ------
Net income (loss) Y (10,702) Y 72,111 - $ 611
------ ------ ------
(Millions of yen, millions of U.S. dollars)
Consolidated Fiscal year ended March 31
2006 2007 Change 2007
------ ------ ------ ------
%
Financial service Y 720,566 Y 624,282 -13.4 $ 5,291
revenue
Net sales and 6,790,031 7,671,413 +13.0 65,012
operating revenue
------ ------ ------
7,510,597 8,295,695 +10.5 70,303
Costs and expenses 7,284,181 8,223,945 +12.9 69,695
------ ------ ------
Operating income 226,416 71,750 -68.3 608
Other income (expenses), 59,913 30,287 -49.4 257
net
------ ------ ------
Income before income 286,329 102,037 -64.4 865
taxes
Income taxes and 162,713 (24,291) - (206)
other
------ ------ ------
Net income Y 123,616 Y 126,328 +2.2 $ 1,071
------ ------ ------
Condensed Statements of Income (Unaudited)
------------------------------
(Millions of yen, millions of U.S. dollars)
Financial Services Fourth quarter ended March 31
2006 2007 Change 2007
------ ------ ------ ------
%
Financial service Y 223,128 Y 184,229 -17.4 $ 1,562
revenue
Financial service 143,822 154,703 +7.6 1,312
expenses
------ ------ ------
Operating income 79,306 29,526 -62.8 250
Other income (expenses), (124) 4,188 - 36
net
------ ------ ------
Income before income 79,182 33,714 -57.4 286
taxes
Income taxes and 29,202 11,742 -59.8 100
other
------ ------ ------
Net income Y 49,980 Y 21,972 -56.0 $ 186
------ ------ ------
(Millions of yen, millions of U.S. dollars)
Sony without Fourth quarter ended March 31
Financial Services 2006 2007 Change 2007
------ ------ ------ ------
%
Net sales and Y1,641,384 Y1,915,323 +16.7 $16,232
operating revenue
Costs and expenses 1,772,802 2,058,613 +16.1 17,446
------ ------ ------
Operating income (loss) (131,418) (143,290) - (1,214)
Other income (expenses), 4,503 3,892 -13.6 33
net
------ ------ ------
Income (loss) before (126,915) (139,398) - (1,181)
income taxes
Income taxes and (10,532) (49,866) - (422)
other
------ ------ ------
Net income (loss) Y (116,383) Y (89,532) - $ (759)
------ ------ ------
(Millions of yen, millions of U.S. dollars)
Consolidated Fourth quarter ended March 31
2006 2007 Change 2007
------ ------ ------ ------
%
Financial service Y 217,289 Y 176,484 -18.8 $ 1,496
revenue
Net sales and 1,638,455 1,913,121 +16.8 16,213
operating revenue
------ ------ ------
1,855,744 2,089,605 +12.6 17,709
Costs and expenses 1,907,646 2,202,977 +15.5 18,670
------ ------ ------
Operating income (loss) (51,902) (113,372) - (961)
Other income (expenses), 4,039 7,688 +90.3 65
net
------ ------ ------
Income (loss) before (47,863) (105,684) - (896)
income taxes
Income taxes and 18,670 (38,124) - (323)
other
------ ------ ------
Net income (loss) Y (66,533) Y (67,560) - $ (573)
------ ------ ------
Condensed Balance Sheet (Unaudited)
-----------------------
(Millions of yen, millions of U.S. dollars)
Financial Services March March March
31 31 31
ASSETS 2006 2007 2007
------ ------ ------
Current assets:
Cash and cash Y 117,630 Y 277,048 $ 2,348
equivalents
Marketable 532,895 490,237 4,155
securities
Other 200,929 321,969 2,728
------ ------ ------
851,454 1,089,254 9,231
Investments and 3,131,269 3,347,897 28,372
advances
Property, plant 37,422 38,671 328
and equipment
Other assets:
Deferred insurance 383,156 394,117 3,340
acquisition costs
Other 164,827 107,703 912
------ ------ ------
547,983 501,820 4,252
------ ------ ------
Y4,568,128 Y4,977,642 $ 42,183
------ ------ ------
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Short-term Y 136,723 Y 48,688 $ 413
borrowings
Notes and accounts 11,707 13,159 112
payable, trade
Deposits from 599,952 752,367 6,376
customers in the
banking business
Other 169,956 143,245 1,213
------ ------ ------
918,338 957,459 8,114
Long-term liabilities:
Long-term debt 128,097 129,484 1,097
Accrued pension and 13,479 8,773 74
severance costs
Future insurance 2,744,321 3,037,666 25,743
policy benefits and
other
Other 170,294 204,317 1,731
------ ------ ------
3,056,191 3,380,240 28,645
Minority interest 4,089 5,145 44
in consolidated
subsidiaries
Stockholders' equity 589,510 634,798 5,380
------ ------ ------
Y4,568,128 Y4,977,642 $ 42,183
------ ------ ------
(Millions of yen, millions of U.S. dollars)
Sony without March March March
Financial Services 31 31 31
ASSETS 2006 2007 2007
------ ------ ------
Current assets:
Cash and cash Y 585,468 Y 522,851 $ 4,431
equivalents
Marketable 4,073 3,078 26
securities
Notes and accounts 973,675 1,343,128 11,382
receivable, trade
Other 1,393,306 1,625,914 13,779
------ ------ ------
2,956,522 3,494,971 29,618
Film costs 360,372 308,694 2,616
Investments and 474,568 623,342 5,283
advances
Investments in 187,400 187,400 1,588
Financial
Services, at cost
Property, plant 1,351,125 1,382,860 11,719
and equipment
Other assets 1,056,726 1,100,795 9,329
------ ------ ------
Y6,386,713 Y7,098,062 $ 60,153
------ ------ ------
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Short-term Y 225,082 Y 80,944 $ 686
borrowings
Notes and accounts 804,394 1,167,324 9,893
payable, trade
Other 1,299,809 1,392,333 11,799
------ ------ ------
2,329,285 2,640,601 22,378
Long-term liabilities:
Long-term debt 701,372 925,259 7,841
Accrued pension and 168,768 164,701 1,396
severance costs
Other 352,457 410,354 3,477
------ ------ ------
1,222,597 1,500,314 12,714
Minority interest 32,623 32,808 278
in consolidated
subsidiaries
Stockholders' equity 2,802,208 2,924,339 24,783
------ ------ ------
Y6,386,713 Y7,098,062 $ 60,153
------ ------ ------
(Millions of yen, millions of U.S. dollars)
Consolidated March March March
31 31 31
ASSETS 2006 2007 2007
------ ------ ------
Current assets:
Cash and cash Y 703,098 Y 799,899 $ 6,779
equivalents
Marketable 536,968 493,315 4,181
securities
Notes and accounts 985,508 1,369,777 11,608
receivable, trade
Other 1,543,950 1,883,732 15,964
------ ------ ------
3,769,524 4,546,723 38,532
Film costs 360,372 308,694 2,616
Investments and 3,519,907 3,888,736 32,955
advances
Property, plant and 1,388,547 1,421,531 12,047
equipment
Other assets:
Deferred insurance 383,156 394,117 3,340
acquisition costs
Other 1,186,247 1,156,561 9,801
------ ------ ------
1,569,403 1,550,678 13,141
------ ------ ------
Y10,607,753 Y11,716,362 $ 99,291
------ ------ ------
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Short-term Y 336,321 Y 95,461 $ 809
borrowings
Notes and accounts 813,332 1,179,694 9,997
payable, trade
Deposits from 599,952 752,367 6,376
customers in the
banking business
Other 1,450,623 1,524,330 12,918
------ ------ ------
3,200,228 3,551,852 30,100
Long-term liabilities:
Long-term debt 764,898 1,001,005 8,483
Accrued pension 182,247 173,474 1,470
and severance
costs
Future insurance 2,744,321 3,037,666 25,743
policy benefits
and other
Other 475,106 542,691 4,600
------ ------ ------
4,166,572 4,754,836 40,296
Minority interest 37,101 38,970 330
in consolidated
subsidiaries
Stockholders' 3,203,852 3,370,704 28,565
equity
------ ------ ------
Y10,607,753 Y11,716,362 $ 99,291
------ ------ ------
Condensed Statements of Cash Flows (Unaudited)
----------------------------------
(Millions of yen, millions of U.S. dollars)
Financial Services Fiscal year ended March 31
2006 2007 2007
------ ------ ------
Net cash provided by Y 147,149 Y 256,540 $ 2,174
operating activities
Net cash used in (563,753) (276,749) (2,345)
investing activities
Net cash provided by 274,863 179,627 1,522
financing activities
------ ------ ------
Net increase (141,741) 159,418 1,351
(decrease) in cash
and cash equivalents
Cash and cash 259,371 117,630 997
equivalents at
beginning of the
fiscal year
------ ------ ------
Cash and cash Y 117,630 Y 277,048 $ 2,348
equivalents at end
of the fiscal year
------ ------ ------
(Millions of yen, millions of U.S. dollars)
Sony without Fiscal year ended March 31
Financial Services 2006 2007 2007
------ ------ ------
Net cash provided by Y 251,975 Y 305,571 $ 2,590
operating activities
Net cash used in (296,376) (431,086) (3,653)
investing activities
Net cash provided by 74,600 59,598 505
financing activities
Effect of exchange 35,537 3,300 28
rate changes on cash
and cash equivalents
------ ------ ------
Net increase 65,736 (62,617) (530)
(decrease) in cash
and cash equivalents
Cash and cash 519,732 585,468 4,961
equivalents at
beginning of the
fiscal year
------ ------ ------
Cash and cash Y 585,468 Y 522,851 $ 4,431
equivalents at end
of the fiscal year
------ ------ ------
(Millions of yen, millions of U.S. dollars)
Consolidated Fiscal year ended March 31
2006 2007 2007
------ ------ ------
Net cash provided by Y 399,858 Y 561,028 $ 4,754
operating activities
Net cash used in (871,264) (715,430) (6,063)
investing activities
Net cash provided by 359,864 247,903 2,101
financing activities
Effect of exchange 35,537 3,300 28
rate changes on cash
and cash equivalents
------ ------ ------
Net increase (76,005) 96,801 820
(decrease) in cash
and cash equivalents
Cash and cash 779,103 703,098 5,959
equivalents at
beginning of the
fiscal year
------ ------ ------
Cash and cash Y 703,098 Y 799,899 $ 6,779
equivalents at end
of the fiscal year
------ ------ ------
Investor Relations Contacts:
----------------------------
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Takao Yuhara Sam Levenson/ Shinji Tomita
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