(English Translation) AUDITED FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31, 2017 1. Consolidated balance sheets 2. Consolidated statement of operations 3. Non-consolidated balance sheets 4. Non-consolidated statement of operations MURATA MACHINERY, LTD. 3, Minami-Ochiai-Cho, Kisshoin, Minami-ku, Kyoto, Japan
Consolidated Balance Sheets Assets Current assets 221,814 229,516 Cash and cash equivalents 68,137 87,357 Notes receivable and accounts receivable, trade 63,315 57,841 Marketable securities 14,484 14,149 Merchandise and finished goods 7,194 7,458 Work in process 44,339 38,058 Raw materials and supplies 9,869 9,882 Deferred income taxes, short-term 7,144 7,409 Others 7,461 7,480 Allowance for doubtful accounts, short-term (133) (122) Fixed assets 108,412 113,612 Tangible fixed assets 29,633 30,602 Buildings and structures 15,861 17,089 Machinery, equipment and industrial vehicles 4,954 4,697 Tools, furniture and fixtures 1,722 1,461 Land 6,729 6,736 Leased assets 159 155 Construction in progress 92 359 Others 113 102 Intangible fixed assets 5,269 3,897 Software 968 911 Goodwill 3,861 2,684 Others 439 301 Investments and other assets 73,509 79,112 Marketable securities 69,826 76,668 Investment in LLC and partnership 1,079 1,538 Deferred income taxes, long-term 1,325 986 Others 2,657 1,398 Allowance for doubtful accounts, long-term (1,296) (226) Allowance for loss from investments (83) (1,252) Total assets 330,226 343,128
Consolidated Balance Sheets Liabilities 144,988 132,134 Current liabilities 115,583 105,841 Notes payable and accounts payable, trade 43,876 41,827 Loan payable, short-term 9,739 9,602 Accrued expenses 6,294 6,868 Income taxes payable 5,946 7,329 Advance received 34,390 25,859 Deposits received 2,114 1,871 Accrued bonuses 4,214 4,924 Allowance for warranty expenses 6,968 5,589 Others 2,037 1,968 Fixed liabilities 29,405 26,292 Long-term loan payable 15,500 15,500 Deferred income taxes 3,585 4,050 Net defined benefit liabilities 8,624 5,706 Others 1,695 1,035 Net assets 185,238 210,994 Stockholder' s equity 172,997 197,920 Capital stock 900 900 Capital surplus 442 442 Retained earnings 171,655 196,578 Accumulated other comprehensive income 11,039 11,627 Valuation difference on marketable securities 13,705 14,416 Translation adjustment 2,118 1,950 Remeasurements of defined benefit plan (4,784) (4,739) Minority interests 1,201 1,446 Total Liabilities and net assets 330,226 343,128
Consolidated Statements of Operations Years Ended March 31, 2016 and March 31, 2017 Net sales 255,020 261,394 Cost of sales 182,403 176,537 Gross profit 72,617 84,856 Selling, general and administrative expenses 50,931 50,130 Income (loss) from operations 21,685 34,726 Other income 3,047 4,638 Interest and dividend income 2,373 2,284 Revenue from investment in affiliated companies 40 - Foreign exchange gain - 1,662 Other 633 691 Other expenses 4,120 4,250 Interest expenses 208 99 Loss from investment in silent partnership 3,219 1,922 Loss from investment in affiliated companies - 870 Provision of allowance for loss from investments 83 1,169 Foreign exchange loss 359 - Other 250 188 Ordinary income (loss) 20,611 35,114 Extraordinary income 334 745 Gain on sale of fixed assets 1 41 Settlement income - 700 Gain on redemption of marketable securities 327 - Other 5 4 Extraordinary loss 535 139 Loss on disposal of fixed assets 74 22 Loss on valuation of marketable securities 71 36 Impairment loss 236 61 Other 151 17 Income (loss) before income taxes 20,410 35,721 Income taxes - current 8,921 13,104 Income taxes - deferred (882) (451) Net income (loss) 12,370 23,067 Net income attributable to noncontrolling interests 146 224 Net income attributable to shareholders of Murata Machinery, Ltd. 12,224 22,843
Balance Sheets Assets Current assets 167,516 173,455 Cash and cash equivalents 41,602 56,620 Notes receivable 6,640 7,008 Electronically recorded monetary claims 2,811 4,679 Accounts receivable, trade 46,738 37,258 Marketable securities 14,484 14,149 Finished goods 3,017 3,541 Work in process 30,157 28,172 Raw materials and supplies 2,772 2,192 Advance 1,644 1,563 Loan receivable, short-term 850 923 Accounts receivable, non-trade 10,788 9,567 Refundable income taxes 17 - Deferred income taxes, short-term 4,868 5,167 Other current assets 1,185 2,630 Allowance for doubtful accounts, short-term (62) (20) Fixed assets 101,896 112,378 Tangible fixed assets 24,646 24,522 Buildings 12,282 12,146 Structures 638 664 Machinery and equipment 3,285 3,226 Cars and industrial vehicles 13 12 Tools, furniture and fixtures 1,110 921 Land 7,288 7,284 Leased assets 1 5 Construction in progress 26 261 Intangible fixed assets 765 572 Investments 76,485 87,282 Marketable securities 61,114 68,731 Investment in affiliates, stock 11,773 11,794 Investment in LLC and partnership 974 1,433 Investment in affiliates 1,856 1,873 Long-term loan receivable 463 1,140 Long-term prepaid expenses 120 82 Claims against bankrupt and reorganized body 4 5 Other investments 373 308 Allowance for doubtful accounts, long-term (113) (211) Allowance for loss from investments (83) (1,252) Total assets 269,413 285,833 Note : The balance of Electronically recorded monetary claims as of March 31 2016, previously classified as notes receivable, is separately described as Electronically recorded monetary claims.
Balance Sheets Liabilities 121,382 117,380 Current liabilities 98,625 93,920 Notes payable 3,815 3,509 Electronically recorded obligations - 2 Accounts payable, trade 41,102 41,141 Loan payable, short-term 7,540 7,540 Current portion of bond payable 170 - Accounts payable, non-trade 54 77 Accrued expenses 4,284 4,270 Income taxes payable 4,879 6,020 Business office taxes payable 31 31 Advance received 18,257 13,115 Accrued bonuses 2,482 3,135 Allowance for warranty expenses 6,553 5,221 Other curent liabilities 9,453 9,855 Fixed liabilities 22,757 23,460 Long-term loan payable 15,500 15,500 Allowance for employee retirement 935 1,295 Deferred income taxes 5,221 5,911 Others fixed liabilities 1,100 753 Net assets 148,031 168,453 Stockholder' s equity 134,430 154,149 Capital stock 900 900 Capital surplus 442 442 Capital surplus 442 442 Retained earnings 133,088 152,807 Legal reserve 225 225 Other retained earnings 132,861 152,582 Reserve for special depreciation 2,038 1,675 Reserve for reduction entry 1,409 1,394 Other reserve 78,720 78,720 Retained earnings - carried forward 50,694 70,793 Valuation differences 13,600 14,303 Valuation difference on marketable securities 13,600 14,303 Total Liabilities and net assets 269,413 285,833
Statements of Operations Years Ended March 31, 2016 and March 31, 2017 Net sales 185,501 198,436 Cost of sales 138,354 142,451 Gross profit 47,146 55,984 Selling, general and administrative expenses 31,711 31,670 Income (loss) from operations 15,435 24,314 Other income 3,959 5,571 Interest and dividend income 3,567 3,787 Foreign exchange gain - 1,452 Other 391 331 Other expenses 4,055 3,244 Interest expenses 198 114 Loss from investment in silent partnership 3,219 1,922 Provision of allowance for loss from investments 83 1,169 Foreign exchange loss 442 - Other 111 39 Ordinary income (loss) 15,338 26,641 Extraordinary income 330 702 Gain on sale of fixed assets 0 1 Settlement income - 700 Gain on sale of marketable securities 1 - Gain on redemption of marketable securities 327 - Other - 1 Extraordinary loss 509 117 Loss on disposal of fixed assets 62 18 Loss on valuation of marketable securities 71 36 Loss on redemption of marketable securities 40 - Impairment loss 236 61 Other 98 0 Income (loss) before income taxes 15,158 27,226 Income taxes - current 6,385 10,284 Income taxes - deferred (1,063) (688) Net income (loss) 9,836 17,630