Annual Report 2007 - Komatsu

More documents

Recommendations

Info

Financial Review Market Risk Exposure Komatsu is exposed to market risk primarily from changes in foreign currency exchange rates and interest rates with respect to international operations and foreign currency denominated credits and debts. In order to manage these risks that arise in the normal course of business, Komatsu enters into various derivative financial transactions pursuant to their policies and procedures. Komatsu does not enter into derivative financial transactions for trading or speculative purposes. Komatsu is exposed to credit-related losses in the event of nonperformance by counterparties to derivative financial instruments. However, because of the counterparties’ satisfactory credit ratings, none are expected to fail to meet their obligations. Foreign Exchange Risk To reduce foreign exchange risks against foreign currency denominated assets and liabilities, Komatsu executes forward exchange contracts and option contracts in a range of 50% to 100% based on their projected cash flow in foreign currencies. The following table provides information concerning derivative financial instruments of Komatsu in relation to foreign currency exchange transactions existing as of March 31, 2007, which are translated into yen at the rate used on that date, together with the related weighted average contractual exchange rates as of March 31, 2007. As of March 31, 2007, the notional amount of option contracts is ¥2,532 million (US$21,458 thousand). Millions of yen (except average contractual rates) Forwards to sell foreign currencies: US$/Yen EUR/Yen EUR/SEK US$/SEK US$/EUR Others Total Contract amounts ¥ 48,887 ¥ 20,074 ¥ 2,799 ¥ 2,474 ¥ 2,101 ¥ 5,680 ¥ 82,015 Average contractual rates 117.23Yen/US$ 151.30Yen/EUR 9.27SEK/EUR 6.97SEK/US$ 0.75EUR/US$ — — Forwards to buy foreign currencies: GBP/EUR Yen/Yuan Yen/A$ Yen/GBP US$/ZAR Others Total Contract amounts ¥ 13,597 ¥ 6,886 ¥ 4,582 ¥ 3,453 ¥ 2,503 ¥10,757 ¥ 41,778 Average contractual rates 0.68GBP/EUR 15.29Yen/Yuan 92.81Yen/A$ 228.09Yen/GBP 0.14US$/ZAR — — Thousands of U.S. dollars Forwards to sell foreign currencies: US$/Yen EUR/Yen EUR/SEK US$/SEK US$/EUR Others Total Contract amounts $414,297 $170,119 $ 23,720 $20,966 $17,805 $48,135 $695,042 Forwards to buy foreign currencies: GBP/EUR Yen/Yuan Yen/A$ Yen/GBP US$/ZAR Others Total Contract amounts $115,229 $ 58,356 $ 38,831 $29,263 $21,212 $91,160 $354,051 46 Annual Report 2007
FINANCIAL REVIEW Interest Rate Risk To reduce risks and hedge variability of cash flow, Komatsu engages in certain interest rate swaps, cross-currency swaps and cap option transactions for interest payment and interest receipt. Certain interest rate swap contracts are not qualified as hedges for financial reporting purposes and are recorded at the fair value and the resultant gains and losses are recognized as income and expenses. The following tables provide information concerning debt obligations excluding capital lease obligations (including due within one year), interest rate swaps, cross-currency swaps and interest caps. For debt obligations, the tables present fair value, principal cash flows and related weighted average interest rates by expected maturity dates. For interest rate and cross-currency swaps, the following tables present fair value, notional amounts and weighted average receive and pay interest rates. For interest caps, the following tables present fair value, notional amounts and its average strike rate. Long-term debt excluding capital lease obligations (including due within one year) Millions of yen Expected maturity date Average interest rate Fair value Total 2008 2009 2010 2011 2012 Thereafter Japanese yen bonds 1.20% ¥ 29,688 ¥ 30,000 ¥ 20,000 ¥ — ¥ 10,000 ¥ — ¥ — ¥ — Euro medium-term notes (relating to variable interest rate) 5.10% 64,486 66,067 13,259 16,300 12,853 7,026 16,629 — Loans, principally from banks (relating to variable interest rate) 2.23% 19,254 19,254 8,088 8,078 3,056 17 15 — Loans, principally from banks (relating to fixed interest rate) 2.18% 75,611 77,204 12,993 45,172 13,037 3,831 1,763 408 Total ¥ 189,039 ¥ 192,525 ¥ 54,340 ¥ 69,550 ¥ 38,946 ¥ 10,874 ¥ 18,407 ¥ 408 Interest rate swaps, cross-currency swaps and interest caps Millions of yen Average interest rate Expected maturity date Receive Pay Fair value Total 2008 2009 2010 2011 2012 Thereafter U.S. dollar interest rate swap 5.01% 4.62% ¥ 193 ¥ 145,687 ¥ 69,556 ¥ 48,242 ¥ 22,641 ¥ 5,248 ¥ — ¥ — Yen/US$ cross-currency swap 1.09% 5.48% (899) 63,500 12,000 7,000 20,500 7,000 17,000 — Yen/EUR cross-currency swap 0.88% 3.98% (1,173) 18,500 10,500 2,000 2,000 2,000 2,000 — Euro interest cap — 4.01% 33 17,778 6,246 5,931 5,601 — — — Others (61) 7,907 826 885 2,419 2,360 472 945 Total ¥ (1,907) ¥ 253,372 ¥ 99,128 ¥ 64,058 ¥ 53,161 ¥ 16,608 ¥ 19,472 ¥ 945 Long-term debt excluding capital lease obligations (including due within one year) Thousands of U.S. dollars Expected maturity date Average interest rate Fair value Total 2008 2009 2010 2011 2012 Thereafter Japanese yen bonds 1.20% $ 251,593 $ 254,238 $169,492 $ — $ 84,746 $ — $ — $ — Euro medium-term notes (relating to variable interest rate) 5.10% 546,492 559,890 112,364 138,136 108,924 59,542 140,924 — Loans, principally from banks (relating to variable interest rate) 2.23% 163,169 163,169 68,542 68,458 25,898 144 127 — Loans, principally from banks (relating to fixed interest rate) 2.18% 640,771 654,271 110,110 382,813 110,483 32,466 14,941 3,458 Total $1,602,025 $1,631,568 $460,508 $589,407 $330,051 $ 92,152 $155,992 $ 3,458 Interest rate swaps, cross-currency swaps and interest caps Thousands of U.S. dollars Average interest rate Expected maturity date Receive Pay Fair value Total 2008 2009 2010 2011 2012 Thereafter U.S. dollar interest rate swap 5.01% 4.62% $ 1,636 $1,234,636 $589,458 $408,831 $191,873 $ 44,474 $ — $ — Yen/US$ cross-currency swap 1.09% 5.48% (7,619) 538,136 101,695 59,322 173,729 59,322 144,068 — Yen/EUR cross-currency swap 0.88% 3.98% (9,941) 156,780 88,984 16,949 16,949 16,949 16,949 — Euro interest cap — 4.01% 280 150,661 52,932 50,263 47,466 — — — Others (517) 67,007 7,000 7,500 20,500 20,000 4,000 8,007 Total $ (16,161) $2,147,220 $840,069 $542,865 $450,517 $140,745 $165,017 $ 8,007 47 Annual Report 2007
Page 1 and 2: Annual Report 2007
Page 3 and 4: UPWARD Fifth Consecutive Year of Gr
Page 5 and 6: Net Sales* Billions of yen 2,000 Op
Page 7 and 8: profit. Net income for the year, th
Page 9 and 10: Interview with Kunio Noji, Presiden
Page 11 and 12: previous tasks of enhancement of ou
Page 13 and 14: With respect to the development of
Page 15 and 16: Q Lastly, could you introduce The K
Page 17 and 18: public accounting firm when the fir
Page 19 and 20: The KOMATSU Way It was a journey of
Page 21 and 22: The KOMATSU Way Corporate Governanc
Page 23 and 24: Brian Kober, Vice President, Corpor
Page 25 and 26: Bruce Nelson Senior Manager, Manufa
Page 27 and 28: Social Activities Management We ha
Page 29 and 30: Review of Operations Trends and Per
Page 31 and 32: Japan While public-sector investmen
Page 33 and 34: Research and Development We are pro
Page 35 and 36: Global Manufacturing Operation for
Page 37 and 38: change. These are the first updates
Page 39 and 40: Financial Section Financial Review.
Page 41 and 42: FINANCIAL REVIEW and mining equipme
Page 43 and 44: FINANCIAL REVIEW wholly owned subsi
Page 45 and 46: FINANCIAL REVIEW cash used in inves
Page 47: FINANCIAL REVIEW 5 Environmental la
Page 51 and 52: FIVE-YEAR SUMMARY Millions of yen (
Page 53 and 54: CONSOLIDATED BALANCE SHEETS Thousan
Page 55 and 56: Consolidated Statements of Sharehol
Page 57 and 58: Notes to Consolidated Financial Sta
Page 59 and 60: NOTES TO CONSOLIDATED FINANCIAL STA
Page 91 and 92: Report of Independent Registered Pu
Page 93 and 94: Directors, Auditors and Officers (A
Page 95 and 96: KOMATSU GROUP INVESTMENT HOLDINGS S
Page 97: 2-3-6 Akasaka, Minato-ku Tokyo 107-

Annual Report 2007 - Komatsu

Create successful ePaper yourself

Delete template?

Save as template?