Revision of forecast of consolidated operating results, expected dividends and
announcement of impairment losses
Ricoh announces revision of forecast of consolidated operating results for the fiscal year ending March 31, 2012 and of expected dividends, initially projected in the second quarter report dated on October 28, 2011, as follows.
1． Revision of forecast of Ricoh’s consolidated operating results for the fiscal year ending March 31, 2012（from April 1, 2011 to March 31, 2012）
(Billions of yen)
per share (yen)
|Forecast announced in
October 2011 (A)
|Current forecast (B)||1,900.0||-18.0||-33.0||-46.0||-63.40|
fiscal year ended March
2．Background of revision
- a.Lower forecast due to global market downturn and other effect from business environment
Net sales will be lower than last forecast due to the global market downturn and floods in Thailand.
- b.Recognition of impairment losses for goodwill and long-lived assets
Ricoh recognized impairment losses for goodwill in amount of 27.4 billion yen and long-lived assets in amount of 9.5 billion yen for Production Printing business according to U.S. Generally Accepted Accounting Principles (U.S. GAAP). These impairment losses are presented in "Selling, general and administrative expenses" in consolidated statements of income. Please refer to "4. Impairment of Goodwill of Production Printing business" for more details.
- c.Recognition of impairment losses for available-for-sale securities
Ricoh recognized impairment losses for available-for-sale securities due to other-than-temporary decline in stock prices in amount of 4.9 billion yen according to U.S. GAAP. These impairment losses are presented in "Other, net" of "Other (income) expenses" in consolidated statements of income.
- d.Decrease of deferred tax assets due to changes of effective tax rate
Ricoh re-measured deferred tax assets and liabilities based on new effective tax rates due to new laws proclaimed by the Japanese government on December 2, 2011. As a result, "Provision for income taxes" in consolidated statements of income increased by 7.2 billion yen in the third quarter ended December 31, 2011.
3．Revision of expected dividends
We have announced of year end dividends in amount of 16.5 yen per share, and 33.0 yen per share in total adding interim dividend already paid in December 2011. However, we regrettably revise our forecast of year end dividends to 8.5 yen per share considering forecasted net losses for the fiscal year.
4．Impairment of Goodwill for Production Printing business
In accordance with U.S. GAAP, Ricoh performs an annual impairment test of goodwill at December 31, which is the annual goodwill impairment test date, instead of amortizing goodwill.
U.S. GAAP requires a company to evaluate fair value of each reporting unit including goodwill. In addition, a company is required to perform a reconciliation of the aggregate fair value of reporting units and market capitalization at the goodwill impairment test date.
The annual goodwill impairment test has not been completed yet. However, we considered it is probable that the goodwill assigned to Production Printing reporting unit is impaired, due to decline of Ricoh's market capitalization. As such, we recognized the best estimate of the impairment loss in the third quarter financial statements.
Ricoh positions Production Printing business as growing business in the medium term. The business was negatively affected by the financial crisis in 2008, especially in the U.S. However, Ricoh is proceeding with enforcement of marketing function by global strategic cooperation with Heidelberger Druckmaschinen AG in Germany which was agreed upon last year in 2011, enlargement of product line up such as RICOH Pro C751, worldwide reorganization by establishment of Ricoh Production Print Solutions in the U.S. and Ricoh forecasts drastic profitability improvement of Production Printing business in the future.
January 31, 2012
Ricoh Company, Ltd.
Information in the news releases is true and accurate at the time of publication.
Manufacture, sales, price and specifications of products may be subject to change.