NOTICE OF CONSOLIDATED AND NON-CONSOLIDATED FINANCIAL STATEMENTS

Transcription

1 NOTICE OF CONSOLIDATED AND NON-CONSOLIDATED FINANCIAL STATEMENTS (For the Financial Year from April 1, 2001 to March 31, 2002) 1 Date of the Board of Directors' Meeting to Approve the Consolidated Financial Statements : May 17, Financial Highlights (Consolidation base) (1) Results of Operations Year ended March Revenues... 2,060,353 1,909,948 $ 15,491,376 Operating Income... 42,321 51, ,203 Net Income (Loss)... (41,153) 9,275 (309,421) Yen Net Income (Loss) per Share... (43.03) 9.7 $ (0.324) (2) Assets and Equity As of March Total Assets... 2,226,712 2,438,041 $ 16,742,195 Total Stockholders' Equity , ,192 1,355,038 Equity/Assets Ratio(%) Yen Equity per Share $ (3) Cash Flows Year ended March Operating Activities... 15,118 54,159 $ 113,669 Investing Activities... 41,640 (8,413) 313,083 Financing Activities... (65,999) (69,978) (496,233) Cash and Cash Equivalents, End of Year... 97, , ,436 1

2 (4) Forecast of major financial results for the financial year from April 1, 2002 to March 31, 2003 The Entire Year Revenues... 1,900,000 $ 14,285,714 Net Income... 11,000 82,707 (5) Basis of Presentation (a) The accompanying consolidated financial statements of Kajima Corporation (the Company ) and its consolidated subsidiaries (together, the Companies ) have been prepared in accordance with the provisions set forth in the Japanese Securities and Exchange Law and its related accounting regulations and in conformity with accounting principles and practices generally accepted in Japan, which are different in certain respects as to application and disclosure requirements of International Accounting Standards ( IAS ). Differences between the accounting policies followed by the Companies and IAS are described in Note 3. The consolidated financial statements are not intended to present the financial position, results of operations and cash flows in accordance with accounting principles and practices generally accepted in countries and jurisdictions other than Japan. In preparing this Notice (the NOTICE ) of the consolidated financial statements, certain reclassifications and rearrangements have been made to the NOTICE issued domestically in Japan in order to present these consolidated statements in a form which is more familiar to readers of these statements outside Japan. Certain amounts in the 2001 consolidated financial statements have been restated to conform with classifications adopted in The accounts of the Company and its Japanese subsidiaries are maintained in Japanese yen, the currency of the country in which they are incorporated and principally operate. The U.S. dollar amounts included in Financial Highlights above and elsewhere in the NOTICE are presented solely for convenience. Such dollar amounts have been translated from yen at the approximate exchange rate in Tokyo on March 31, 2002 of 133 = U.S. $1. The translations should not be construed as representations that Japanese yen have been, could have been, or could in the future be, converted into U.S. dollars at that or any other rate. (b) Scope of Consolidation The consolidated financial statements for the financial year ended March 31, 2002 include the accounts of the Company and its 82 significant subsidiaries. Other 55 subsidiaries were not consolidated, as they were not significant in terms of total assets, net sales, retained earnings, net income or net loss. All unconsolidated subsidiaries and 38 affiliates were accounted for using the equity method. The excess of the cost of an acquisition over the fair value of the net assets of the acquired subsidiary and affiliate at the date of acquisition is being amortized over a period of 5 years. All significant inter-company balances and transactions have been eliminated in consolidation. All material unrealized profit included in assets resulting from inter-company transactions is eliminated. The breakdown and changes of fully consolidated companies and companies accounted for using the equity method are summarized below: 2

3 i) Breakdown as of March 31, 2002 Number of consolidated subsidiaries : 82 Principal consolidated subsidiaries : Taiko Trading Co., Ltd. Kajima Leasing Corporation Kajima Road Co., Ltd. Kajima U.S.A. Inc. Kajima Europe B.V. Kajima Overseas Asia Pte. Ltd. Number of unconsolidated subsidiaries : 55 accounted for using the equity method F.R.C. Corporation, ARTES Corporation and 53 other companies Number of affiliated companies : 38 accounted for using the equity method Katabami Kogyo Co., Ltd., Yaesu Book Center Co., Ltd. and 36 other companies ii) Changes in the financial year ended March 31, 2002 Newly consolidated companies Companies excluded from consolidation Companies newly accounted for using the equity method Companies excluded from the equity method : 1 subsidiary of Kajima Europe B.V. : 1 subsidiary of Kajima U.S.A. Inc. and 1 subsidiary of Kajima Europe B.V. : Kajima Kudan Kaihastu Yugen Kaisha and 4 other companies : 4 subsidiaries and 2 affiliated companies (c) Per Share Information The computation of net income or loss per share is based upon the weighted average number of shares of common stock outstanding during each financial year. The weighted average number of common shares used in the computation for the financial year ended March 31, 2002 and 2001 were 956,408,272 and 956,428,128 shares, respectively. Equity per share data is calculated using the number of shares at the end of each financial year. Diluted net income per share is not disclosed because of the net loss for the financial year ended March 31, 2002 and the anti-dilutive effect for the financial year ended March 31, Further information is available at : Mr. Hironobu Takano General Manager Accounting Department Kajima Corporation 2-7, Motoakasaka 1- chome, Minato-ku, Tokyo , Japan Telephone (03) International Facsimile (03) International

4 .Business Performance and Financial Condition (a) Business Performance 1. Summary of business performance for the financial year ended March 31, 2002 Overview Japan s economy during the current period continued its phase of contraction as it was buffeted by a decelerating world economy, a deflation-induced fall in domestic demand which resulted in deteriorating corporate earnings, and stagnant personal consumption in the face of rising unemployment. Negative market conditions included lackluster movements of stock prices, land prices that followed a path of steady decline, and a renewed concern over the stability of our financial system with its yet-to-be-solved non-performing loan problems. Private sector construction demand remained depressed overall, as an increase in non-manufacturing sector demand was offset by a sharp drop in investments by the manufacturing sector. Governments at all levels, and especially local governments, are under pressure to cut back on their spending, resulting in declining levels of public works orders. On the overseas front, worsening economic conditions barely affected the orders received by our Group Companies. Against this backdrop, the Kajima Group Companies performed during the period as follows: Consolidated revenues grew 7.9% over the previous period to 2,060.3 billion. The increase is largely due to the percentage of completion method of accounting that has been used since the previous period. Consolidated operating income dropped 17.9% from the previous period to 42.3 billion. The losses of 113 billion mainly resulting from revaluation of real estate development and investments in affiliated company and dispositions/revaluations of investments in securities forced the Group to post 41.2 billion in consolidated net loss for the period. Segment Performance (1) Construction Domestic Operations The amount of contracts awarded to The Group Companies declined 7.8% from the previous period to 1,252.8 billion primarily due to drops in orders secured by the Company, Taiko Trading Co., Ltd. and Kajima Road Co., Ltd. Of this amount, the Company alone accounted for billion in civil engineering orders (a 4.4% drop from last year) and 811 billion in architectural construction orders (a 3.6% drop from last year), for a total of 1,093.2 billion (a 3.8% drop from last year). Civil engineering orders fell as demand from both public and private sectors fell. Architectural construction orders dipped as manufacturing company orders dipped. Total revenues, reflecting a change in accounting to the percentage of completion method, rose 12.9% over the last year to 1,624.9 billion. Of this amount, the Company accounted for billion in civil engineering orders (an 11.4% increase from last year) and 1,072.5 billion in architectural construction orders (a 25.9% increase from last year), for a total of 1,435.1billion (a 21.9% increase from last year). 4

5 Overseas Operations Orders from overseas clients amounted to billion (a 19.1% increase from last year) which breaks down to 39.7 billion awarded to the Company and consolidated subsidiaries in Japan and billion to overseas subsidiaries. The increase in orders largely took place in Asia and Europe. Total revenues amounted to billion (an increase of 0.8% from last year), consisting of 26.8 billion posted by Company and consolidated subsidiaries in Japan and billion posted by overseas subsidiaries. Profit Margins The Group Companies saw gross profit margin on construction projects fall form 7.8% to 6.8% this period due to competitive business environment, and posted billion in gross profit on construction, a drop by 2 billion from the previous period. The Company s gross profit margin on construction projects fell from 8.9% to 7.0% this period. Consolidated operating profit fell 33.1% to 27.6 billion. Principal works awarded during the financial year ended March 31, 2002 SEIBU Railway Co., Ltd. ( Client ) ( Works ) Tokyo Prince Hotel Park Tower Hokkaido Electric Power Co., Inc. Kyogoku Power Plant, Civil Engineering Work (Unit 1) Shirogane 1-chome East-Area Redevelopment Partners UMCi Pte. Ltd. Mori Trust Co., Ltd. Mori Sangyo Trust Co., Ltd. Taipei City, Department of Rapid Transport System Shirogane 1-chome East-Area Redevelopment Project FAB12S Main Contractor Works[awarded to Kajima Overseas Asia Pte. Ltd. (Subsidiary in Singapore)] Marunouchi 1 1 Project Taipei Metropolitan System, Lu-Chou Line(CL700B Section) Principal works completed during the financial year ended March 31, 2002 ( Client ) ( Works ) Oriental Land Co., Ltd. New Theme Park Tohoku Electric Power Co., Inc. Onagawa Nuclear Power Station Unit 3 Saitama Prefecture Saitama Stadium 2002 Meiji Life Insurance Company Industrial Commercial Property Pte. Ltd. Shin Kwan Realty Pte. Ltd. Kansai International Airport Land Development Co., Ltd. Land Axis Tower Singapore Exchange Center [completed by Kajima Overseas Asia Pte. Ltd. (Subsidiary in Singapore)] Second-phase Airport Island, Soil Improving (Lot1) (2) Real Estate Consolidated revenues totaled 155 billion (a drop of 21.9% from last year), consisting of 88.2 billion in Japan and 66.8 billion overseas. The decline occurred following a large increase registered a year ago due to sales of large development projects in Japan. Consolidated operating profit jumped 25.6% to 11.8 billion. 5

6 (3) Others Other segments chiefly consist of processing and selling construction materials, and providing design, engineering and property management services. Consolidated revenues totaled billion (a 4.7% increase from last year) with consolidated operating profit of 1.9 billion (a 42.2 % jump from last year). 2. Declaration of Dividends We plan to declare an annual ordinary dividend of 7 per share (to be paid out semi-annually) in accordance with our earlier announcement. 3. Business Performance Forecast for the Next Period While there are signs that production levels and corporate earnings may start to bottom out, Japan s economic recovery is not immediately in sight as new investments are not picking up and personal consumption is expected to remain weak. Fiscal restraint is likely to persist in the public sector and the downtrend on public works orders will continue. Overall demand for construction services in the private sector is also likely to suffer from lack of strength in business investments and in housing starts. The U.S. economy may be actually bottoming out; however, the pace of its recovery is far from certain, and prospects for market growth in other overseas regions are also uncertain. Given the foregoing, we forecast our consolidated performance over the next period as posted at the beginning of this announcement. Construction order target for the group over the next year will be 1,350 billion, consisting of 1,210 billion in Japan and 140 billion overseas. Construction order target for the Company over the next year will be 1,200 billion, consisting of 1,110 billion in construction contracts and 90 billion in real estate projects. Given the adverse market conditions that are continuing, and a need to strengthen the capital base of the Company by retaining earnings, we plan to reduce next year s annual dividend pay-out from 7 per share to 5 per share. (b) Financial Condition Net cash provided by operating activities was a surplus of 15.1 billion (a drop of 72.1% from last year). This resulted from net loss before income taxes and minority interests of 67.6 billion, which was adjusted, among others, by adding back depreciation and an increase provision for doubtful account as well as provision for loss on development projects, which was then reduced, among others, by a 91.4 billion increase in receivables, billion increase in inventories and billion decrease in advance received. 6

7 Net cash provided by investing activities showed a surplus of 41.6 billion. This was a reversal from a deficit of 8.4 billion during the last year, as 47.6 billion in proceeds from sales of marketable and investment securities, 9.2 billion in proceeds from collection of loans and other moneys received have exceeded the outflows including 18.2 billion used to payment for purchases of property and equipment. Net cash used in financing activities amounted to 66.0 billion (a 5.7% drop from the last year), most of which consisted of 59.1 billion used to reduce interest-bearing liabilities of the Consolidated Group and 6.7 billion paid out in dividends. Thus, the end-of-year cash and cash equivalents totaled 97 billion, down 7.5 billion from a year before. 7