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FORM 6-K

 

 

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

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 2011

Commission File Number 1-8320

 

 

Hitachi, Ltd.

(Translation of registrant’s name into English)

 

 

6-6, Marunouchi 1-chome, Chiyoda-ku, Tokyo 100-8280, Japan

(Address of principal executive offices)

 

 

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 if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1):             

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7):             

Indicate by check mark whether by furnishing the information contained in this Form, the registrant 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-            

 

 

 

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This report on Form 6-K contains the following:

 

1.	Press release dated May 11, 2011 regarding consolidated financial results for fiscal 2010

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SIGNATURES

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.

 

				Hitachi, Ltd.
				(Registrant)
Date May 13, 2011		By		/s/ Toshiaki Kuzuoka
				Toshiaki Kuzuoka Senior Vice President and Executive Officer

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FOR IMMEDIATE RELEASE

Hitachi Announces Consolidated Financial Results for Fiscal 2010

Tokyo, May 11, 2011 — Hitachi, Ltd. (NYSE:HIT / TSE:6501) today announced its consolidated financial results for fiscal 2010, ended March 31, 2011.

 

Note:		1.  All figures were converted at the rate of 83 yen to the U.S. dollar, the approximate exchange rate on the Tokyo Foreign Exchange Market as of March 31, 2011.
		2.  Operating income is presented in accordance with financial reporting principles and practices generally accepted in Japan.

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Summary

In millions of yen and U.S. dollars, except Net income (loss) attributable to Hitachi, Ltd. stockholders per share (6) and Net income (loss) attributable to Hitachi, Ltd. stockholders per American Depositary Share (7).

 

		The years ended March 31
		Yen (millions)								(B)/(A) X100 (%)				U.S.  Dollars (millions)
		2010 (A)				2011 (B)								2011
1. Revenues			8,968,546				9,315,807				104				112,239
2. Operating income			202,159				444,508				220				5,356
3. Income before income taxes			63,580				432,201				680				5,207
4. Net income (loss)			(84,391	)			303,126				—				3,652
5. Net income (loss) attributable to Hitachi, Ltd.			(106,961	)			238,869				—				2,878
6. Net income (loss) attributable to Hitachi, Ltd. stockholders per share
Basic			(29.20	)			52.89				—				0.64
Diluted			(29.20	)			49.38				—				0.59
7. Net income (loss) attributable to Hitachi, Ltd. stockholders per ADS (representing 10 shares)
Basic			(292	)			529				—				6.37
Diluted			(292	)			494				—				5.95

 

Notes:			1.			The Company’s consolidated financial statements are prepared based on U.S.GAAPs.
			2.			Operating income is presented in accordance with financial reporting principles and practices generally accepted in Japan.
			3.			The figures are for 913 consolidated subsidiaries, including Variable Interest Entities, and 164 equity-method affiliates.
						Consolidated trust accounts are not included into the figures of consolidated subsidiaries.

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1. Qualitative Information Concerning Consolidated Business Results

1-1. Summary of Fiscal 2010 Consolidated Business Results

(1) Business Results

 

		Year ended March 31, 2011
		Yen (billions)				Year-over-year change (% or billions yen)				U.S.  dollars (millions)
Revenues			9,315.8				4	%			112,239
Operating income			444.5				242.3				5,356
Income before income taxes			432.2				368.6				5,207
Net Income			303.1				387.5				3,652
Net Income attributable to Hitachi, Ltd.			238.8				345.8				2,878

In fiscal 2010, the year ended March 31, 2011, demand in the electronics- and automotive-related fields recovered globally. However, the Great East Japan Earthquake on March 11 caused catastrophic damage over a wide area of eastern Japan, and had a major impact on an array of corporate activities, from production to sales. Hitachi suffered damage to its buildings and production facilities, in-process products, and other assets. The Company also faced production adjustments, delays in contract forming, delivering, and customer’s inspection / acceptance.

Hitachi’s consolidated revenues for fiscal 2010 increased 4% year over year to 9,315.8 billion yen, despite the impact of the Great East Japan Earthquake on all segments. In addition to higher revenues in the Construction Machinery segment, centered on emerging countries, this overall increase was attributable to higher year over year revenues in the High Functional Materials & Components, Automotive Systems and Electronic Systems & Equipment segments and others in line with recovering demand in the electronics- and automotive-related fields.

Overseas revenues increased 11% year over year, to 4,046.5 billion yen, mainly due to a global recovery in demand in the electronics- and automotive-related fields.

Hitachi posted consolidated operating income of 444.5 billion yen, an improvement of 242.3 billion yen year over year, despite the impact of the Great East Japan Earthquake in all segments. This much improved result was attributable to increased revenues and improved year over year operating income in the Electronic Systems & Equipment, Components & Devices, High Functional Materials & Components, Construction Machinery, and Automotive Systems segments. These improvements reflected progress with business structure reform measures, procurement cost and fixed expenses reduction and project management. Especially, the Information & Telecommunication Systems segment improved even amid ongoing reduction in IT investment in Japan.

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Hitachi posted net other deductions of 12.3 billion yen, an improvement of 126.2 billion yen year over year. Despite recording exchange losses resulting from the yen’s appreciation, the overall improvement reflected the recording of a net gain on sales of marketable securities mainly due to the transfer of management rights relating to IPS Alpha Technology, Ltd. to Panasonic Corporation, as well as a decrease of business restructure expenses. As a result, Hitachi recorded income before income taxes of 432.2 billion yen, an improvement of 368.6 billion yen year over year. After income taxes of 129.0 billion yen, Hitachi posted net income of 303.1 billion yen, a year over year improvement of 387.5 billion yen. After deducting net income attributable to noncontrolling interests of 64.2 billion yen, Hitachi posted record-high net income attributable to Hitachi, Ltd. of 238.8 billion yen, a year over year improvement of 345.8 billion yen.

(2) Revenues and Operating Income by Segment

Results by segment were as follows.

[Information & Telecommunication Systems]

 

		Year ended March 31, 2011
		Yen (billions)				Year-over-year change (% or billions yen)				U.S.  dollars (millions)
Revenues			1,652.0				(3	%)			19,904
Operating income			98.6				4.0				1,188

For fiscal 2010, the segment recorded revenues of 1,652.0 billion yen, a decrease of 3% year over year, with software and services, and hardware recording lower sales due to ongoing reductions in IT investment in Japan. This overall decrease came despite robust growth of storage solutions sales in overseas markets.

Segment operating income improved 4.0 billion yen to 98.6 billion yen, mainly the result of higher year over year operating income from software and services due primarily to improved project management and cost reductions even amid the negative impacts of lower revenues and the Great East Japan Earthquake.

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[Power Systems]

 

		Year ended March 31, 2011
		Yen (billions)				Year-over-year change (% or billions yen)				U.S.  dollars (millions)
Revenues			813.2				(8	%)			9,798
Operating income			22.0				0				265

For fiscal 2010, segment revenues decreased 8% year over year to 813.2 billion yen. The decrease was mainly attributable to the impact of the Great East Japan Earthquake, as well as lower year over year sales from thermal power generation systems due to some projects being pushed back, and lower sales recorded for preventative maintenance services for nuclear power generation systems.

Segment operating income was mostly the same as the previous year at 22.0 billion yen, as improved project management, progress with cost reductions and other factors offset the impact of lower revenues and the impact of the Great East Japan Earthquake.

[Social Infrastructure & Industrial Systems]

 

		Year ended March 31, 2011
		Yen (billions)				Year-over-year change (% or billions yen)				U.S.  dollars (millions)
Revenues			1,156.9				(7	%)			13,939
Operating income			39.9				(2.1	)			481

For fiscal 2010, segment revenues decreased 7% year over year, to 1,156.9 billion yen, despite strong growth in sales of elevators and escalators in China. The overall decrease was mainly due to the impact of the Great East Japan Earthquake, in addition to lower sales resulting from a transactional method change in some products of a manufacturing subsidiary are distributed.

Segment operating income decreased 2.1 billion year over year, to 39.9 billion yen, mainly due to the decrease in revenues, and the impact of the Great East Japan Earthquake.

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[Electronic Systems & Equipment]

 

		Year ended March 31, 2011
		Yen (billions)				Year-over-year change (% or billions yen)				U.S.  dollars (millions)
Revenues			1,079.3				8	%			13,004
Operating income			37.2				42.5				449

For fiscal 2010, the segment recorded an 8% year over year increase in revenues, to 1,079.3 billion yen, despite the impact of the Great East Japan Earthquake. The increase in revenues mainly reflected higher sales of semiconductor-related manufacturing equipment, electronic component processing equipment and others, in line with rebounding capital expenditures in the electronics field.

Despite the impact of the Great East Japan Earthquake, segment operating income improved 42.5 billion yen year over year, to 37.2 billion yen due to higher sales of semiconductor-related manufacturing equipment, electronic component processing equipment and other products.

[Construction Machinery]

 

		Year ended March 31, 2011
		Yen (billions)				Year-over-year change (% or billions yen)				U.S.  dollars (millions)
Revenues			751.3				29	%			9,053
Operating income			49.1				31.5				593

For fiscal 2010 segment revenues increased 29% year over year, to 751.3 billion yen, despite the impact of the Great East Japan Earthquake. This increase reflected the effect of making Indian company Telco Construction Equipment Co., Ltd. a consolidated subsidiary in March 2010. Another contributing factor was growth in sales of hydraulic excavators and other products, especially in China and other emerging economies such as Asia, and to resource-rich nations such as Australia.

Despite the impact of the Great East Japan Earthquake, segment operating income improved 31.5 billion yen year over year, to 49.1 billion yen due to higher revenues.

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[High Functional Materials & Components]

 

		Year ended March 31, 2011
		Yen (billions)				Year-over-year change (% or billions yen)				U.S.  dollars (millions)
Revenues			1,408.1				13	%			16,966
Operating income			84.5				40.0				1,018

For fiscal 2010, segment revenues increased 13% year over year, to 1,408.1 billion yen. This result reflects year over year growth at Hitachi Metals, Ltd., Hitachi Cable, Ltd. and Hitachi Chemical Co., Ltd. due to healthy demand for automotive-related components and other products.

Despite the impact of the Great East Japan Earthquake, segment operating income improved 40.0 billion yen to 84.5 billion yen due to higher revenues.

[Automotive Systems]

 

		Year ended March 31, 2011
		Yen (billions)				Year-over-year change (% or billions yen)				U.S.  dollars (millions)
Revenues			737.9				16	%			8,890
Operating income			23.7				29.2				287

For fiscal 2010, segment revenues increased 16% year over year, to 737.9 billion yen, despite the impact of the Great East Japan Earthquake. This increase reflected healthy growth in sales before the earthquake, supported by a global recovery in demand, particularly in emerging countries, as well as a government program in Japan to spur vehicle sales.

Despite the impact of the Great East Japan Earthquake, segment operating income improved 29.2 billion yen year over year, to 23.7 billion yen on account of improved capacity utilization in line with recovering demand, and the benefits of business structure reforms.

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[Components & Devices]

 

		Year ended March 31, 2011
		Yen (billions)				Year-over-year change (% or billions yen)				U.S.  dollars (millions)
Revenues			809.8				7	%			9,757
Operating income			43.6				42.5				526

For fiscal 2010, segment revenues increased 7% year over year, to 809.8 billion yen, mainly due to higher sales of HDDs, reflecting robust demand for use in PCs and servers.

Despite the impact of the Great East Japan Earthquake, segment operating income improved 42.5 billion yen year over year, to 43.6 billion yen. This improvement was due to higher earnings in HDD operations on increased sales, the contribution from new products, cost reduction and others.

 

Note:		HDD operations are conducted by Hitachi Global Storage Technologies (Hitachi GST), which has a December 31 fiscal year-end, different from Hitachi’s March 31 year-end. Hitachi’s results for the year ended March 31, 2011 include operating results of Hitachi GST for the period from January through December 2010.

[Digital Media & Consumer Products]

 

		Year ended March 31, 2011
		Yen (billions)				Year-over-year change (% or billions yen)				U.S.  dollars (millions)
Revenues			951.5				2	%			11,465
Operating income			14.9				22.1				180

For fiscal 2010, the segment recorded a 2% increase in revenues year over year, to 951.5 billion yen, despite optical disk drive-related products recording lower sales due to lackluster demand. The segment revenue growth reflected higher year over year sales of commercially packaged air conditioners, as well as growth in sales of flat-panel TVs, room air-conditioners, refrigerators and other products eligible for the eco-points program in Japan.

Segment operating income improved 22.1 billion yen year over year, to 14.9 billion yen. This result was mainly due to strong performances by commercially packaged and room air-conditioners, in addition to the benefits of business structure reforms in flat-panel TV and other operations. This improvement was despite lower earnings from optical disk drive-related products in line with lower sales, as well as the impact of the Great East Japan Earthquake.

 

Note:		The optical disk drive operations are conducted by Hitachi-LG Data Storage, Inc (HLDS), which has a December 31 fiscal year-end, different from Hitachi’s March 31 year-end. Hitachi’s results for the year ended March 31, 2011 include the operating results of HLDS for the period from January through December 2010.

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[Financial Services]

 

		Year ended March 31, 2011
		Yen (billions)				Year-over-year change (% or billions yen)				U.S.  dollars (millions)
Revenues			372.9				(11	%)			4,494
Operating income			14.2				5.7				172

For fiscal 2010, the segment reported an 11% year over year decrease in revenues, to 372.9 billion yen, due to the recording of large cancellation penalty payment receipts in the previous fiscal year. This was despite healthy growth in outsourcing and other businesses that generate revenues from commission services at Hitachi Capital Corporation.

Despite the impact of the Great East Japan Earthquake, segment operating income improved 5.7 billion yen to 14.2 billion yen. This was due to recording earnings related to receivables that were recorded as gains on sale up through March 31, 2010 in line with the consolidation of securitization entities from April 1, 2010, based on new U.S. GAAP accounting standards. The improvement also reflected reduced financing costs at Hitachi Capital Corporation in the U.S. and Europe.

[Others]

 

		Year ended March 31, 2011
		Yen (billions)				Year-over-year change (% or billions yen)				U.S.  dollars (millions)
Revenues			767.4				0	%			9,247
Operating income			28.9				9.5				349

For fiscal 2010, segment revenues were mostly unchanged from the previous year, at 767.4 billion yen, as higher revenues at Hitachi Transport System, Ltd. on healthy growth in third-party logistics solutions were mainly offset by the impact of the transfer in June 2010 of Hitachi group’s internal food service business to Nissin Healthcare Food Service Co., Ltd.

Despite the impact of the Great East Japan Earthquake, segment operating income improved 9.5 billion yen to 28.9 billion yen, mainly due to higher earnings in line with increased revenues at Hitachi Transport System, Ltd.

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(3) Revenues by Market

 

		Year ended March 31, 2011
		Yen (billions)				Year-over-year % change				U.S.  dollars (millions)
Japan			5,269.2				(1	%)			63,485
Outside Japan			4,046.5				11	%			48,754
Asia			2,073.7				22	%			24,985
North America			781.1				7	%			9,411
Europe			760.0				(8	%)			9,157
Other Areas			431.6				8	%			5,201

Revenues in Japan were 5,269.2 billion yen, down 1% year over year. This decrease was mainly due to delays in contract forming, delivering, and customer’s inspection / acceptance, in regard to certain products due to the impact of the Great East Japan Earthquake. This was despite higher revenues mainly in the High Functional Materials & Components, Automotive Systems and Digital Media & Consumer Products segments in line with recovering demand in the electronics- and automotive-related fields, and the positive impact of the eco-points program in Japan.

Outside Japan revenues increased 11% to 4,046.5 billion yen. In addition to higher sales in the Construction Machinery Segment, mainly to emerging countries, the Electronic Systems & Equipment, High Functional Materials & Components, Components & Devices and Automotive Systems segments posted strong revenue growth due to recovering demand in the electronics- and automotive-related fields.

As a result, the ratio of overseas revenues to consolidated revenues increased 2 points year over year to 43%.

(4) Capital Investment, Depreciation and R&D Expenditures

Capital investment on a completion basis, excluding leasing assets, increased 10% year over year, to 273.1 billion yen, primarily due to investments for boosting production to meet recovering demand.

Depreciation, excluding leasing assets, decreased 15% year over year, to 303.6 billion yen, primarily due to the strict selection of capital investments throughout the previous year.

R&D expenditures increased 6% year over year to 395.1 billion yen, which corresponded to 4.2% of consolidated revenues. The increase was due mainly to further R&D investment to strengthen the Social Innovation Business.

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(5) Outlook for Fiscal 2011

At this time, Hitachi has not issued consolidated business forecasts for fiscal 2011 because it is difficult to rationally estimate the impact of the Great East Japan Earthquake. Hitachi plans to announce these forecasts when disclosure becomes possible.

1-2. Financial Position

(1) Financial Position

 

		As of March 31, 2011
		Yen (billions)				Change from March 31, 2010				U.S.  dollars (millions)
Total assets			9,185.6				221.1				110,670
Total liabilities			6,744.2				47.6				81,256
Interest-bearing debt			2,521.5				154.4				30,380
Total Hitachi, Ltd. stockholders’ equity			1,439.8				155.2				17,348
Noncontrolling interests			1,001.5				18.3				12,067
Total Hitachi, Ltd. stockholders’ equity ratio			15.7	%			1.4 point improvement				—
D/E ratio (including noncontrolling interests)*1			1.03 times				0.35 point improvement				—
D/E ratio (including noncontrolling interests)*2			0.86 times				0.18 point improvement				—

 

*1:		Including liabilities (current and noncurrent) associated with the consolidation of securitization entities in accordance with the application of new accounting standards.
*2:		Excluding liabilities (current and noncurrent) associated with the consolidation of securitization entities in accordance with the application of new accounting standards.

Total assets as of March 31, 2011 increased 221.1 billion yen from March 31, 2010 to 9,185.6 billion yen. This mainly resulted from the recording of financial assets that had been transferred off the balance sheet to securitization entities, principally in the Financial Services Segment, in accordance with the application of new U.S. GAAP accounting standards effective April 1, 2010. Similarly, interest-bearing liabilities increased by 154.4 billion yen, to 2,521.5 billion yen due to the recording of liabilities associated with the consolidation of securitization entities. Stockholders’ equity increased 155.2 billion yen from March 31, 2010, to 1,439.8 billion yen due mainly to the improvement in net income attributable to Hitachi, Ltd. As a result, the total Hitachi, Ltd. stockholders’ equity ratio was 15.7%. The debt-to-equity ratio, including noncontrolling interests, was 1.03. Excluding the impact of adopting new accounting standards, the debt-to-equity ratio, including noncontrolling interests, improved 0.18 point from March 31, 2010 to 0.86.

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(2) Cash Flows

 

		Year ended March 31, 2011
		Yen (billions)				Year-over-year change				U.S.  dollars (millions)
Cash flows from operating activities			841.5				43.2				10,139
Cash flows from investing activities			(260.3	)			270.2				(3,137	)
Free cash flows			581.2				313.5				7,003
Cash flows from financing activities			(584.1	)			(81.8	)			(7,038	)

Operating activities provided net cash of 841.5 billion yen, a year over year increase of 43.2 billion yen. This increase primarily reflected a major improvement in net income.

Investing activities used net cash of 260.3 billion yen, 270.2 billion yen less than in the previous year, mainly due to proceeds from the sale of shareholdings, and the strict selection of investments in property, plant and equipment.

Free cash flows, the sum of cash flows from operating and investing activities, stood at a positive 581.2 billion yen, a 313.5 billion yen improvement year over year.

Financing activities used net cash of 584.1 billion yen, primarily for debt repayment and dividend payments.

The net result of the above items was a decrease of 22.7 billion yen in cash and cash equivalents, to 554.8 billion yen.

Free cash flows increased due to the consolidation of securitization entities in accordance with the application of new U.S. GAAP accounting standards effective from April 1, 2010. However, the application of these standards had almost the same effect on cash outflows in financing activities.

(3) Trends in Cash Flow Indexes

 

		Year ended March  31, 2009				Year ended March  31, 2010				Year ended March  31, 2011
Hitachi, Ltd. stockholders’ equity ratio (%)			11.2				14.3				15.7
Equity ratio based on market value (%)			9.4				17.4				21.3
Cash flow to interest-bearing debt ratio			5.0				3.0				3.0
Interest coverage ratio (times)			16.5				30.4				33.8

 

(a)	Hitachi, Ltd. stockholder’s equity ratio: Total Hitachi, Ltd. shareholders’ equity / Total assets

(b)	Equity ratio based on market value: Market capitalization / Total assets

(c)	Cash flow to interest-bearing debt ratio: Interest-bearing debt / Cash flows from operating activities

(d)	Interest coverage ratio: Cash flows from operating activities / Interest charges

 

Note:

Market capitalization is computed based on the number of issued shares, excluding treasury stock.

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1-3. Basic Policy on the Distribution of Earnings and Fiscal 2010 and 2011 Dividends

Hitachi views enhancement of the long-term and overall interests of shareholders as an important management objective.

The industrial sector encompassing energy, information systems, social infrastructure and other primary businesses of Hitachi is undergoing rapid technological innovation and changes in market structure. This makes vigorous upfront investment in R&D and plant and equipment essential for securing and maintaining market competitiveness and improving profitability. Dividends are therefore decided based on medium- to long-term business plans with an eye on ensuring the availability of internal funds for reinvestment and the stable growth of dividends, with appropriate consideration of a range of factors, including Hitachi’s financial condition, results of operations and dividend payout ratio.

Hitachi believes that the repurchase of its shares should be undertaken, when necessary, as part of its policy on distribution to shareholders to complement the dividend payout. In addition, Hitachi will repurchase its own shares on an ongoing basis in order to implement a flexible capital strategy, including business restructuring, to maximize shareholder value so far as consistent with the dividend policy. Such action will be taken by Hitachi after considering its future capital requirement under its business plans, market conditions and other relevant factors.

Based on the above policies, Hitachi plans to pay an annual dividend of 8 yen per share for fiscal 2010, which includes a commemorative dividend of 2 yen per share for Hitachi’s centennial anniversary. Dividends for fiscal 2011 have yet to be determined.

Cautionary Statement

Certain statements found in this document may constitute “forward-looking statements” as defined in the U.S. Private Securities Litigation Reform Act of 1995. Such “forward-looking statements” reflect management’s current views with respect to certain future events and financial performance and include any statement that does not directly relate to any historical or current fact. Words such as “anticipate,” “believe,” “expect,” “estimate,” “forecast,” “intend,” “plan,” “project” and similar expressions which indicate future events and trends may identify “forward-looking statements.” Such statements are based on currently available information and are subject to various risks and uncertainties that could cause actual results to differ materially from those projected or implied in the “forward-looking statements” and from historical trends. Certain “forward-looking statements” are based upon current assumptions of future events which may not prove to be accurate. Undue reliance should not be placed on “forward-looking statements,” as such statements speak only as of the date of this document.

Factors that could cause actual results to differ materially from those projected or implied in any “forward-looking statement” and from historical trends include, but are not limited to:

 

•

economic conditions, including consumer spending and plant and equipment investment in Hitachi’s major markets, particularly Japan, Asia, the United States and Europe, as well as levels of demand in the major industrial sectors Hitachi serves, including, without limitation, the information, electronics, automotive, construction and financial sectors;

 

•

exchange rate fluctuations of the yen and other currencies in which Hitachi makes significant sales or in which Hitachi’s assets and liabilities are denominated, particularly against the U.S. dollar and the euro;

 

•

uncertainty as to Hitachi’s ability to access, or access on favorable terms, liquidity or long-term financing;

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•

uncertainty as to general market price levels for equity securities in Japan, declines in which may require Hitachi to write down equity securities that it holds;

 

•

the potential for significant losses on Hitachi’s investments in equity method affiliates;

 

•

increased commoditization of information technology products and digital media-related products and intensifying price competition for such products, particularly in the Components & Devices and the Digital Media & Consumer Products segments;

 

•

uncertainty as to Hitachi’s ability to continue to develop and market products that incorporate new technologies on a timely and cost-effective basis and to achieve market acceptance for such products;

 

•

rapid technological innovation;

 

•

the possibility of cost fluctuations during the lifetime of, or cancellation of, long-term contracts for which Hitachi uses the percentage-of-completion method to recognize revenue from sales;

 

•

fluctuations in the price of raw materials including, without limitation, petroleum and other materials, such as copper, steel, aluminum and synthetic resins or shortages of materials, parts and components;

 

•

fluctuations in product demand and industry capacity;

 

•

uncertainty as to Hitachi’s ability to implement measures to reduce the potential negative impact of fluctuations in product demand, exchange rates and/or price of raw materials or shortages of materials, parts and components;

 

•

uncertainty as to Hitachi’s ability to achieve the anticipated benefits of its strategy to strengthen its Social Innovation Business;

 

•

uncertainty as to the success of restructuring efforts to improve management efficiency by divesting or otherwise exiting underperforming businesses and to strengthen competitiveness and other cost reduction measures;

 

•

general socioeconomic and political conditions and the regulatory and trade environment of countries where Hitachi conducts business, particularly Japan, Asia, the United States and Europe, including, without limitation, direct or indirect restrictions by other nations on imports and differences in commercial and business customs including, without limitation, contract terms and conditions and labor relations;

 

•

uncertainty as to the success of alliances upon which Hitachi depends, some of which Hitachi may not control, with other corporations in the design and development of certain key products;

 

•

uncertainty as to Hitachi’s access to, or ability to protect, certain intellectual property rights, particularly those related to electronics and data processing technologies;

 

•

uncertainty as to the outcome of litigation, regulatory investigations and other legal proceedings of which the Company, its subsidiaries or its equity method affiliates have become or may become parties;

 

•

the possibility of incurring expenses resulting from any defects in products or services of Hitachi;

 

•

the possibility of disruption of Hitachi’s operations in Japan by earthquakes, tsunamis or other natural disasters, including the possibility of continuing adverse effects on Hitachi’s operations as a result of the earthquake and tsunami that struck northeastern Japan on March 11, 2011;

 

•

uncertainty as to Hitachi’s ability to maintain the integrity of its information systems, as well as Hitachi’s ability to protect its confidential information or that of its customers;

 

•

uncertainty as to the accuracy of key assumptions Hitachi uses to evaluate its significant employee benefit related costs; and

 

•

uncertainty as to Hitachi’s ability to attract and retain skilled personnel.

The factors listed above are not all-inclusive and are in addition to other factors contained in Hitachi’s periodic filings with the U.S. Securities and Exchange Commission and in other materials published by Hitachi.

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2. Management Policy

(1) Basic Management Policy

Amid intensifying competition in world markets, the Hitachi Group has been expanding its business through development of Hitachi and its related companies (subsidiaries and affiliated companies). Hitachi aims to improve its development by delivering competitive products and services imbuing higher value for customers. By taking full advantage of the diverse resources of the Hitachi Group while at the same time reviewing and restructuring businesses, Hitachi will bolster its competitiveness. This process will be consistent with Hitachi’s basic management policy, which is to increase shareholder value by meeting the expectations of customers, shareholders, employees and other stakeholders.

(2) Medium- and Long-term Management Strategy

The Hitachi Group will work to drive growth through the Social Innovation Business and establish an even more solid financial base. This will involve capitalizing fully on the Hitachi Group’s business base built up over the years to promote three themes—transforming into a truly global company; expanding environmental businesses; and fusing social infrastructure and IT. The Social Innovation Business includes information and telecommunication systems, power systems, industrial and transportation systems, and social and urban systems, as well as the sophisticated materials and key devices that support them.

(3) Issues Facing Hitachi Group

Japan’s economy and society was significantly impacted by the Great East Japan Earthquake. As a corporate group responsible for social infrastructure, the Hitachi Group is making a concerted effort to implement the following measures:

 

•

Hitachi is making efforts to help with Japan’s recovery, including cooperating to alleviate power shortages, and providing relief assistance to disaster-stricken areas.

 

•

Hitachi will draw upon the Hitachi Group’s outstanding environmental technologies to provide products and services with a lower environmental impact and thereby help protect the natural environment. In regard to the Fukushima Nuclear Power Station, Hitachi will offer its full cooperation to the government of Japan and Tokyo Electric Power Company on short-term countermeasures, as well as on medium- and long-term measures designed to improve and resolve the situation.

Although the global economic outlook remains uncertain, the Hitachi Group is determined to continue growing and to become a truly preeminent global company. Specifically, Hitachi will continue working to achieve the Fiscal 2012 Mid-term Management Plan drafted in the previous year. To engineer the revival of a strong Hitachi, the Company will implement the following measures:

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•

Hitachi will accurately grasp new business opportunities from a global standpoint, and enhance its local sales structures and R&D and production systems overseas to ensure that it addresses customer needs properly in each region. The Company will train and fully utilize the human resources needed to achieve this goal.

 

•

Hitachi will focus on the Social Innovation Business, which supplies advanced social infrastructure utilizing information and telecommunication systems technology. The goal is to achieve highly profitable and stable growth going forward.

 

•

Hitachi will promote cost structure reform activities throughout the Group, to complete the shift to a globally competitive cost structure. Examples of such activities include global procurement and expanded bulk and centralized purchasing.

 

•

Hitachi will continue working to bolster its financial position by improving cash flows through inventory reductions and other actions.

 

•

Hitachi will further cement society’s trust in the Hitachi Group by continuing to provide products and services of the highest quality to customers.

 

•

Hitachi has worked to eliminate misconduct within the Hitachi Group, but regrets that isolated incidents of misconduct have still occurred. Taking this situation seriously, Hitachi will reaffirm its commitment to remaining steadfast and compliant in order to eradicate misconduct.

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Consolidated Statements of Operations

 

		The years ended March 31
		Yen (millions)								(B)/(A) X100 (%)				U.S. Dollars (millions)
		2010 (A)				2011 (B)								2011
Revenues			8,968,546				9,315,807				104				112,239
Cost of sales			6,849,255				6,967,433				102				83,945
Selling, general and administrative expenses			1,917,132				1,903,866				99				22,938
Operating income			202,159				444,508				220				5,356
Other income			18,185				87,237				480				1,051
(Interest and dividends)			17,816				17,507				98				211
(Other)			369				69,730				—				840
Other deductions			156,764				99,544				63				1,199
(Interest charges)			26,252				24,878				95				300
(Other)			130,512				74,666				57				900
Income before income taxes			63,580				432,201				680				5,207
Income taxes			147,971				129,075				87				1,555
Net income (loss)			(84,391	)			303,126				—				3,652
Less: Net income attributable to noncontrolling interests			22,570				64,257				285				774
Net income (loss) attributable to Hitachi, Ltd.			(106,961	)			238,869				—				2,878

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Consolidated Balance Sheets

 

		Yen (millions)												U.S. Dollars (millions)
		As of March 31, 2010 (A)				As of March 31, 2011 (B)				(B)-(A)				As of March 31, 2011
Total Assets			8,964,464				9,185,629				221,165				110,670
Current assets			4,775,197				4,900,029				124,832				59,036
Cash and cash equivalents			577,584				554,810				(22,774	)			6,684
Short-term investments			53,575				16,598				(36,977	)			200
Trade receivables
Notes			104,353				100,694				(3,659	)			1,213
Accounts			2,138,139				1,990,225				(147,914	)			23,979
Investments in leases			194,108				228,346				34,238				2,751
Current portion of financial assets transferred to consolidated securitization entities			—				183,559				183,559				2,212
Inventories			1,222,077				1,341,768				119,691				16,166
Other current assets			485,361				484,029				(1,332	)			5,832
Investments and advances			712,993				614,145				(98,848	)			7,399
Property, plant and equipment			2,219,804				2,111,270				(108,534	)			25,437
Intangible assets			518,050				528,018				9,968				6,362
Financial assets transferred to consolidated securitization entities			—				304,160				304,160				3,665
Other assets			738,420				728,007				(10,413	)			8,771
Total Liabilities and Equity			8,964,464				9,185,629				221,165				110,670
Current liabilities			3,931,203				4,088,824				157,621				49,263
Short-term debt and current portion of long-term debt			755,181				810,806				55,625				9,769
Current portion of non-recourse borrowings of consolidated securitization entities			—				190,868				190,868				2,300
Trade payables
Notes			25,737				20,430				(5,307	)			246
Accounts			1,229,546				1,236,758				7,212				14,901
Advances received			385,199				395,605				10,406				4,766
Other current liabilities			1,535,540				1,434,357				(101,183	)			17,281
Noncurrent liabilities			2,765,416				2,655,416				(110,000	)			31,993
Long-term debt			1,611,962				1,300,311				(311,651	)			15,666
Non-recourse borrowings of consolidated securitization entities			—				219,566				219,566				2,645
Retirement and severance benefits			905,183				891,815				(13,368	)			10,745
Other liabilities			248,271				243,724				(4,547	)			2,936
Total equity			2,267,845				2,441,389				173,544				29,414
Total Hitachi, Ltd. stockholders’ equity			1,284,658				1,439,865				155,207				17,348
Common stock			408,810				409,129				319				4,929
Capital surplus			620,577				603,133				(17,444	)			7,267
Legal reserve and retained earnings			713,479				922,036				208,557				11,109
Accumulated other comprehensive loss			(432,057	)			(493,062	)			(61,005	)			(5,941	)
(Foreign currency translation adjustments)			(182,783	)			(252,206	)			(69,423	)			(3,039	)
(Pension liability adjustments)			(272,410	)			(256,566	)			15,844				(3,091	)
(Net unrealized holding gain on available-for-sale securities)			25,564				16,905				(8,659	)			204
(Cash flow hedges)			(2,428	)			(1,195	)			1,233				(14	)
Treasury stock			(26,151	)			(1,371	)			24,780				(17	)
Noncontrolling interests			983,187				1,001,524				18,337				12,067

 

Note:

Figures of Intangible assets and Other liabilities as of March 31, 2010 have been restated since the fair value measurement related to a business combination recorded in March 31, 2010 was finalized in the first quarter ended June 30,2010.

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Consolidated Statements of Stockholders’ Equity

 

		The years ended March 31
		Yen (millions)								U.S. Dollars (millions)
		2010				2011				2011
Hitachi, Ltd. stockholders’ equity
Common stock
Balance at beginning of year			282,033				408,810				4,925
Issuance of common stock			126,776				—				—
Conversion of convertible bonds			1				319				4
Balance at end of year			408,810				409,129				4,929
Capital surplus
Balance at beginning of year			560,066				620,577				7,477
Issuance of common stock			125,644				—				—
Conversion of convertible bonds			1				319				4
Sales of treasury stock			(136	)			(9,534	)			(115	)
Equity transactions and other			(64,998	)			(8,229	)			(99	)
Balance at end of year			620,577				603,133				7,267
Retained earnings
Balance at beginning of year			820,440				713,479				8,596
Effect on retained earnings of consolidation of securitization entities upon initial adoption of new accounting guidances			—				(7,732	)			(93	)
Net income (loss) attributable to Hitachi, Ltd.			(106,961	)			238,869				2,878
Cash dividends			—				(22,580	)			(272	)
Balance at end of year			713,479				922,036				11,109
Accumulated other comprehensive loss
Balance at beginning of year			(586,351	)			(432,057	)			(5,206	)
Current-period change			154,294				(61,005	)			(735	)
Balance at end of year			(432,057	)			(493,062	)			(5,941	)
Treasury stock
Balance at beginning of year			(26,237	)			(26,151	)			(315	)
Current-period change			86				24,780				299
Balance at end of year			(26,151	)			(1,371	)			(17	)
Total Hitachi, Ltd. stockholders’ equity			1,284,658				1,439,865				17,348
Noncontrolling interest
Balance at beginning of year			1,129,401				983,187				11,846
Effect on retained earnings of consolidation of securitization entities upon initial adoption of new accounting guidances			—				(7,210	)			(87	)
Net income attributable to noncontrolling interests			22,570				64,257				774
Dividends to noncontrolling interests			(24,618	)			(20,184	)			(243	)
Equity transactions and other			(144,166	)			(18,526	)			(223	)
Balance at end of year			983,187				1,001,524				12,067
Total equity			2,267,845				2,441,389				29,414
Comprehensive income
Net income (loss)			(84,391	)			303,126				3,652
Other comprehensive income (loss) arising during the year:
Foreign currency translation adjustments			6,907				(87,379	)			(1,053	)
Pension liability adjustments			164,023				16,076				194
Net unrealized holding gain (loss) on available-for-sale securities			28,676				(5,352	)			(64	)
Cash flow hedges			(671	)			1,988				24
Total other comprehensive income (loss) arising during the year			198,935				(74,667	)			(900	)
Comprehensive income			114,544				228,459				2,753

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Consolidated Statements of Cash Flows

 

		The years ended March 31
		Yen (millions)								U.S. Dollars (millions)
		2010				2011				2011
Cash flows from operating activities
Net income (loss)			(84,391	)			303,126				3,652
Adjustments to reconcile net income (loss) to net cash provided by operating activities
Depreciation			441,697				382,732				4,611
Amortization			116,065				115,037				1,386
Net gain on sale of investments in securities and other			(6,061	)			(72,987	)			(879	)
Decrease (increase) in receivables			(138,785	)			121,606				1,465
Decrease (increase) in inventories			205,848				(171,275	)			(2,064	)
Increase in payables			62,295				47,512				572
Other			201,631				115,803				1,395
Net cash provided by operating activities			798,299				841,554				10,139
Cash flows from investing activities
Purchase of property, plant and equipment, net			(265,438	)			(227,033	)			(2,735	)
Purchase of intangible assets, net			(85,092	)			(95,500	)			(1,151	)
Purchase of tangible assets and software to be leased, net			(248,669	)			(248,580	)			(2,995	)
Proceeds from sale (purchase) of investments in securities and shares of consolidated subsidiaries resulting in deconsolidation, net			(129,579	)			25,386				306
Collection of investments in leases			172,327				286,356				3,450
Other			25,856				(975	)			(12	)
Net cash used in investing activities			(530,595	)			(260,346	)			(3,137	)
Cash flows from financing activities
Decrease in interest-bearing debt			(459,488	)			(535,469	)			(6,451	)
Proceeds from issuance of common stock			252,420				—				—
Dividends paid to stockholders			(134	)			(22,466	)			(271	)
Dividends paid to noncontrolling interests			(24,852	)			(19,575	)			(236	)
Other			(270,290	)			(6,666	)			(80	)
Net cash used in financing activities			(502,344	)			(584,176	)			(7,038	)
Effect of consolidation of securitization entities upon initial adoption of new accounting guidances			—				12,030				145
Effect of exchange rate changes on cash and cash equivalents			4,298				(31,836	)			(384	)
Net decrease in cash and cash equivalents			(230,342	)			(22,774	)			(274	)
Cash and cash equivalents at beginning of year			807,926				577,584				6,959
Cash and cash equivalents at end of year			577,584				554,810				6,684

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Segment Information

(1) Business Segments

 

		The years ended March 31
		Yen (millions)								(B)/(A) X100 (%)				U.S. Dollars (millions)
		2010 (A)				2011 (B)								2011
Revenues
Information & Telecommunication Systems			1,705,587				1,652,040				97				19,904
			17	%			16	%
Power Systems			882,135				813,207				92				9,798
			9	%			8	%
Social Infrastructure & Industrial Systems			1,250,225				1,156,936				93				13,939
			12	%			11	%
Electronic Systems & Equipment			998,632				1,079,355				108				13,004
			10	%			10	%
Construction Machinery			583,636				751,387				129				9,053
			6	%			7	%
High Functional Materials & Components			1,249,327				1,408,153				113				16,966
			12	%			13	%
Automotive Systems			638,828				737,901				116				8,890
			6	%			7	%
Components & Devices			754,889				809,852				107				9,757
			7	%			8	%
Digital Media & Consumer Products			929,258				951,596				102				11,465
			9	%			9	%
Financial Services			419,650				372,981				89				4,494
			4	%			4	%
Others			763,665				767,463				100				9,247
			8	%			7	%
Subtotal			10,175,832				10,500,871				103				126,517
			100	%			100	%
Eliminations & Corporate items			(1,207,286	)			(1,185,064	)			—				(14,278	)
Total			8,968,546				9,315,807				104				112,239

 

Note:		Revenues by business segment include intersegment transactions.

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		The years ended March 31
		Yen (millions)								(B)/(A) X100 (%)				U.S. Dollars (millions)
		2010 (A)				2011 (B)								2011
Operating income (loss)
Information & Telecommunication Systems			94,592				98,641				104				1,188
			41	%			22	%
Power Systems			22,075				22,022				100				265
			9	%			5	%
Social Infrastructure & Industrial Systems			42,086				39,952				95				481
			18	%			9	%
Electronic Systems & Equipment			(5,218	)			37,284				—				449
			(2	%)			8	%
Construction Machinery			17,649				49,192				279				593
			8	%			11	%
High Functional Materials & Components			44,412				84,506				190				1,018
			19	%			18	%
Automotive Systems			(5,486	)			23,791				—				287
			(2	%)			5	%
Components & Devices			1,149				43,652				—				526
			0	%			10	%
Digital Media & Consumer Products			(7,206	)			14,949				—				180
			(3	%)			3	%
Financial Services			8,518				14,255				167				172
			4	%			3	%
Others			19,423				28,930				149				349
			8	%			6	%
Subtotal			231,994				457,174				197				5,508
			100	%			100	%
Eliminations & Corporate items			(29,835	)			(12,666	)			—				(153	)
Total			202,159				444,508				220				5,356

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- 23 -

(2) Revenues by Market

 

		The years ended March 31
		Yen (millions)								(B)/(A) X100 (%)				U.S. Dollars (millions)
		2010 (A)				2011 (B)								2011
Japan			5,313,790				5,269,259				99				63,485
			59	%			57	%
Asia			1,699,071				2,073,756				122				24,985
			19	%			22	%
North America			729,698				781,139				107				9,411
			8	%			8	%
Europe			824,697				760,011				92				9,157
			9	%			8	%
Other Areas			401,290				431,642				108				5,201
			5	%			5	%
Outside Japan			3,654,756				4,046,548				111				48,754
			41	%			43	%
Total			8,968,546				9,315,807				104				112,239
			100	%			100	%

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- 24 -

Per Share Information

 

		The years ended March 31
		2010				2011				2011
		(Yen)				(Yen)				(U.S. Dollars)
Hitachi, Ltd. stockholders’ equity per share			287.13				318.73				3.84
Net income (loss) attributable to Hitachi, Ltd. stockholders per share
Basic			(29.20	)			52.89				0.64
Diluted			(29.20	)			49.38				0.59

The reconciliations of the numbers and the amounts used in the basic and diluted net income (loss) attributable to Hitachi, Ltd. stockholders per share computations are as follows:

 

		The years ended March 31
		2010				2011				2011
		(Number of shares)				(Number of shares)
Weighted average number of shares on which basic net income (loss) per share is calculated			3,662,578,076				4,515,932,415
Effect of dilutive securities:
130% call option attached unsecured convertible bonds (8th series)			—				315,249,850
Number of shares on which diluted net income (loss) per share is calculated			3,662,578,076				4,831,182,265
		(Millions of yen)				(Millions of yen)				(Millions of U.S. dollars)
Net income (loss) attributable to Hitachi, Ltd. stockholders			(106,961	)			238,869				2,878
Effect of dilutive securities:
Other			0				(296	)			(4	)
Net income (loss) attributable to Hitachi, Ltd. stockholders on which diluted net income (loss) per share is calculated			(106,961	)			238,573				2,874

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Unconsolidated Financial Statements Summary

Income Statements

 

		The years ended March 31
		Yen (millions)								(B)/(A) X100 (%)				U.S. Dollars (millions)
		2010 (A)				2011 (B)								2011
Revenues			1,938,810				1,795,306				93				21,630
Cost of sales			1,471,552				1,308,866				89				15,769
Gross Profit			467,258				486,439				104				5,861
Selling, general and administrative expenses			463,757				453,322				98				5,462
Operating income			3,500				33,117				946				399
Other income			98,665				123,449				125				1,487
Other deductions			42,961				29,002				68				349
Ordinary income			59,204				127,564				215				1,537
Extraordinary gain			13,684				10,944				80				132
Extraordinary loss			106,107				95,620				90				1,152
Income (loss) before income taxes			(33,217	)			42,888				—				517
Current income taxes			(3,537	)			(21,747	)			615				(262	)
Deferred income taxes			5,440				360				7				4
Net income (loss)			(35,120	)			64,276				—				774
Basic EPS (yen and dollars)			(9.59	)			14.23				—				0.17
Diluted EPS (yen and dollars)			—				13.32				—				0.16
Balance Sheets
		Yen (millions)								(B)-(A)				U.S. Dollars (millions)
		As of March 31, 2010 (A)				As of March 31, 2011 (B)								As of March 31, 2011
Current assets			1,314,489				1,171,849				(142,639	)			14,119
(Quick assets)			1,121,264				970,177				(151,087	)			11,689
(Inventories)			193,224				201,672				8,447				2,430
Fixed assets			2,013,208				1,974,488				(38,720	)			23,789
(Investments)			1,695,694				1,667,573				(28,120	)			20,091
(Others)			317,514				306,914				(10,600	)			3,698
Total assets			3,327,698				3,146,337				(181,360	)			37,908
Current liabilities			1,700,390				1,584,185				(116,204	)			19,087
Fixed liabilities			739,623				621,111				(118,512	)			7,483
(Debentures)			229,998				229,360				(638	)			2,763
(Long-term loans)			387,608				279,000				(108,608	)			3,361
(Deferred tax liabilities)			14,504				12,629				(1,875	)			152
(Others)			107,512				100,121				(7,391	)			1,206
Total liabilities			2,440,013				2,205,296				(234,717	)			26,570
Net assets			887,684				941,041				53,356				11,338
Liabilities and net assets			3,327,698				3,146,337				(181,360	)			37,908

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May 11, 2010

Hitachi, Ltd.

Supplementary Information for the Year ended March 31, 2011

1. Summary

(1) Consolidated Basis

 

		Fiscal 2009				Fiscal 2010
		(A)				(B)				(B)/(A)
Revenues*1			8,968.5				9,315.8				104	%
Operating income*1			202.1				444.5				220	%
Percentage of revenues			2.3				4.8				—
Income before income taxes*1			63.5				432.2				680	%
Net income (loss)*1			(84.3	)			303.1				—
Net income (loss) attributable to Hitachi, Ltd.*1			(106.9	)			238.8				—
Dividend payout ratio(%)			—				15.1				—
Average exchange rate (yen / U.S.$)			93				86				—
Net interest and dividends*1			(8.4	)			(7.3	)			—

 

*1	Billions of yen

 

		As of March 31, 2010				As of March 31, 2011
Cash & cash equivalents, Short-term investments (billions of yen)			631.1				571.4
Interest-bearing debt*2 (billions of yen)			3,110.7				2,521.5
Interest-bearing debt*3 (billions of yen)			2,367.1				2,111.7
D/E Ratio (Including Noncontrolling interests)*2 (times)			1.38				1.03
D/E Ratio (Including Noncontrolling interests)*3 (times)			1.04				0.86
Number of employees			359,746				361,745
Japan			230,948				216,393
Overseas			128,798				145,352
Number of consolidated subsidiaries (Including Variable Interest Entities)			900				913
Japan			365				351
Overseas			535				562

 

*2	Including liabilities (current and noncurrent) associated with the consolidation of securitization entities.

*3	Excluding liabilities (current and noncurrent) associated with the consolidation of securitization entities.

(2) Unconsolidated Basis

 

		Fiscal 2009				Fiscal 2010
		(A)				(B)				(B)/(A)
Revenues*1			1,938.8				1,795.3				93	%
Operating income*1			3.5				33.1				946	%
Ordinary income*1			59.2				127.5				215	%
Net income (loss)*1			(35.1	)			64.2				—
Average exchange rate (yen / U.S.$)			93				86				—

 

		As of March 31, 2010				As of March 31, 2011
Cash & cash equivalents, Short-term investments (billions of yen)			98.5				34.0
Interest-bearing debt (billions of yen)			738.5				645.6
Number of employees			31,065				32,926

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2. Consolidated Overseas Revenues by Business Segment^*4

 

(Billions of yen)
		Fiscal 2009				Fiscal 2010
		(A)				(B)				(B)/(A)
Information & Telecommunication Systems			373.9				393.8				105	%
Power Systems			356.0				317.1				89	%
Social Infrastructure & Industrial Systems			291.6				263.2				90	%
Electronic Systems & Equipment			481.8				573.4				119	%
Construction Machinery			416.4				584.5				140	%
High Functional Materials & Components			462.1				535.0				116	%
Automotive Systems			269.4				311.1				116	%
Components & Devices			528.2				598.3				113	%
Digital Media & Consumer Products			449.7				440.0				98	%
Financial Services			48.9				48.5				99	%
Others			81.6				99.3				122	%
Subtotal			3,760.2				4,164.9				111	%
Eliminations & Corporate Items			(105.4	)			(118.4	)			—
Total			3,654.7				4,046.5				111	%

 

*4	Starting from current period, the figures, which also includes previous period, of Consolidated Overseas Revenues by Business Segment has changed to include intersegment transaction.

3. Overseas Production (Total Revenues of Overseas Manufacturing Subsidiaries)^*5

 

		Fiscal 2009				Fiscal 2010
		(A)				(B)				(B)/(A)
Overseas production (billions of yen)			2,182.4				2,487.0				114	%
Percentage of revenues (%)			24				27				—
Percentage of overseas revenues (%)			60				61				—

 

*5	Figures in tables 3, 7, 8 and 9 represent unaudited financial information prepared by the Company for the purpose of this supplementary information.

4. Consolidated Capital Investment by Business Segment (Completion basis, including leasing assets)

 

(Billions of yen)
		Fiscal 2009				Fiscal 2010
		(A)				(B)				(B)/(A)
Information & Telecommunication Systems			24.2				29.6				122	%
Power Systems			31.1				10.5				34	%
Social Infrastructure & Industrial Systems			25.3				17.9				71	%
Electronic Systems & Equipment			10.3				13.3				129	%
Construction Machinery			32.8				36.5				111	%
High Functional Materials & Components			49.7				60.7				122	%
Automotive Systems			15.2				17.3				114	%
Components & Devices			39.0				56.6				145	%
Digital Media & Consumer Products			14.7				14.7				100	%
Financial Services			295.6				282.5				96	%
Others			25.2				33.9				135	%
Subtotal			563.5				573.9				102	%
Eliminations & Corporate Items			(17.1	)			(17.0	)			—
Total			546.3				556.8				102	%
Internal use Assets			247.4				273.1				110	%
Leasing Assets			298.9				283.7				95	%

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5. Consolidated Depreciation by Business Segment

 

(Billions of yen)
		Fiscal 2009				Fiscal 2010
		(A)				(B)				(B)/(A)
Information & Telecommunication Systems			37.7				35.5				94	%
Power Systems			22.0				17.8				81	%
Social Infrastructure & Industrial Systems			25.3				21.0				84	%
Electronic Systems & Equipment			16.1				13.2				82	%
Construction Machinery			39.1				35.2				90	%
High Functional Materials & Components			78.5				68.8				88	%
Automotive Systems			35.9				27.4				76	%
Components & Devices			62.9				53.1				84	%
Digital Media & Consumer Products			23.8				20.3				86	%
Financial Services			65.2				58.8				90	%
Others			32.8				27.1				83	%
Subtotal			439.7				378.7				86	%
Eliminations & Corporate Items			1.9				3.9				201	%
Total			441.7				382.7				87	%
Internal use Assets			356.4				303.6				85	%
Leasing Assets			85.2				79.1				93	%

6. Consolidated R&D Expenditure by Business Segment

 

(Billions of yen)
		Fiscal 2009				Fiscal 2010
		(A)				(B)				(B)/(A)
Information & Telecommunication Systems			82.2				79.5				97	%
Power Systems			17.6				16.4				93	%
Social Infrastructure & Industrial Systems			19.9				21.5				108	%
Electronic Systems & Equipment			44.1				45.1				102	%
Construction Machinery			15.4				15.8				103	%
High Functional Materials & Components			44.8				46.7				104	%
Automotive Systems			38.4				45.3				118	%
Components & Devices			69.1				74.0				107	%
Digital Media & Consumer Products			18.7				23.8				127	%
Financial Services			0.1				0.2				166	%
Others			4.6				4.9				105	%
Corporate Items			17.0				21.6				127	%
Total			372.4				395.1				106	%
Percentage of revenues (%)			4.2				4.2				—

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7. Consolidated Balance Sheets by Financial and Non-Financial Services^*5

 

 

			(Billions of yen)
		As of March 31, 2011
		Manufacturing, Services and Others				Financial Services				Total*6
Current assets			4,302.1				940.0				4,900.0
Cash and cash equivalents			533.6				108.8				554.8
Trade receivables			1,770.8				483.4				2,090.9
Investments in leases			82.6				171.2				228.3
Current portion of financial assets transferred to consolidated securitization entities			58.2				125.3				183.5
Inventories			1,341.8				0.2				1,341.7
Others			514.9				50.9				500.6
Investments and advances			605.6				43.2				614.1
Property, plant and equipment			1,920.1				193.4				2,111.2
Financial assets transferred to consolidated securitization entities			—				304.1				304.1
Other assets			849.8				456.7				1,256.0
Total Assets			7,677.7				1,937.6				9,185.6
Current liabilities			3,505.8				926.8				4,088.8
Short-term debt and current portion of long-term debt			605.2				347.4				810.8
Current portion of non-recourse borrowings of consolidated securitization entities			21.8				169.0				190.8
Trade payables			1,182.3				224.7				1,257.1
Others			1,696.4				185.6				1,829.9
Long-term debt			886.5				484.3				1,300.3
Non-recourse borrowings of consolidated securitization entities			—				219.5				219.5
Other noncurrent liabilities			1,075.0				64.8				1,135.5
Total Liabilities			5,467.4				1,695.5				6,744.2
Total Hitachi, Ltd. stockholders’ equity			1,308.9				142.8				1,439.8
Noncontrolling interests			901.3				99.1				1,001.5
Total Equity			2,210.3				242.0				2,441.3
Total Liabilities and Equity			7,677.7				1,937.6				9,185.6
Interest-bearing debt*2			1,513.6				1,220.3				2,521.5
D/E ratio (including noncontrolling interests)*2			0.68				5.04				1.03
D/E ratio (including noncontrolling interests)*3			0.67				3.44				0.86
Total Hitachi, Ltd. stockholders’ equity ratio			17.0	%			7.4	%			15.7	%

 

*6	Total Figures exclude intra-segment transactions.

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8. Consolidated Statements of Operations by Financial and Non-Financial Services^*5

 

			(Billions of yen)
		Fiscal 2010
		Manufacturing, Services and Others				Financial Services				Total*6
Revenues			9,112.6				372.9				9,315.8
Operating income			431.7				14.2				444.5
Income before income taxes			419.7				13.9				432.2
Net income attributable to Hitachi, Ltd.			236.3				4.2				238.8

9. Consolidated Statements of Cash Flows by Financial and Non-Financial Services^*5

 

			(Billions of yen)
		Fiscal 2010
		Manufacturing, Services and Others				Financial Services				Total*6
Cash flows from operating activities			671.5				190.9				841.5
Cash flows from investing activities			(399.9	)			126.9				(260.3	)
Cash flows from financing activities			(255.3	)			(434.2	)			(584.1	)
Effect of consolidation of securitization entities upon initial adoption of new accounting guidances			—				12.0				12.0
Effect of exchange rate changes on cash and cash equivalents			(31.6	)			(0.1	)			(31.8	)
Net decrease in cash and cash equivalents			(15.5	)			(104.4	)			(22.7	)
Cash and cash equivalents at beginning of year			549.1				213.3				577.5
Cash and cash equivalents at end of year			533.6				108.8				554.8

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10. Information & Telecommunication Systems

(1) Revenues and Operating Income^*7

 

		Fiscal 2009				Fiscal 2010
		(A)				(B)				(B)/(A)
Revenues			1,705.5				1,652.0				97	%
Software & Services			1,139.6				1,119.7				98	%
Software			152.6				159.4				104	%
Services			987.0				960.2				97	%
Hardware			565.8				532.3				94	%
Storage*8			194.4				184.9				95	%
Servers*9			57.0				49.6				87	%
PCs*10			28.9				29.5				102	%
Telecommunication			141.4				135.6				96	%
Others			144.1				132.5				92	%
Operating income			94.5				98.6				104	%
Software & Services			77.1				85.8				111	%
Hardware			17.3				12.7				73	%

 

*7	Figures for each product exclude intra-segment transactions.

*8	Figures for Storage include disk array subsystems, etc.

*9	Figures for Servers include general-purpose computers, UNIX servers, etc.

*10	Figures for PCs include PC servers, client PCs (only commercial use), etc.

(2) Storage Solutions

 

(Billions of yen)

Fiscal 2009

Fiscal 2010

(A)

(B)

(B)/(A)

Revenues

304.0

322.0

106

%

11. Hard Disk Drives^*11*12

 

		Fiscal 2009				Fiscal 2010												Fiscal 2011
						Three months ended June 30				Total								Three months ending June  30
Period recorded for consolidated accounting purposes		(A)				(B)				(C)				(C)/(A)				(D)(Preliminary)				(D)/(B)
Shipment Period		Jan. 2009 to Dec. 2009				Jan. 2010 to Mar. 2010				Jan. 2010 to Dec. 2010								Jan. 2011 to Mar. 2011
Revenues
Billions of yen			451.7				132.3				526.8				117	%			115.4				87	%
Millions of U.S. dollars			4,821				1,459				6,003				125	%			1,402				96	%
Operating income
Billions of yen			9.2				19.7				57.2				621	%			6.6				34	%
Millions of U.S. dollars			106				217				645				606	%			80				37	%
Shipments (thousand units)*13			91,400				26,500				113,800				124	%			28,600				108	%
Consumer and Commercial
2.5-inch			50,600				15,700				65,300				129	%			15,800				101	%
3.5-inch			31,700				7,800				34,000				107	%			8,900				115	%
Servers			5,500				1,500				7,400				135	%			1,900				132	%
Emerging			2,070				780				3,530				170	%			970				123	%
External HDD			1,550				800				3,460				224	%			930				116	%

 

*11

The Hard Disk Drive operations are conducted by Hitachi Global Storage Technologies (Hitachi GST), which has a December 31 fiscal year-end, different from Hitachi’s March 31 year-end. Hitachi’s results for the twelve months ended March 31, 2011 include the operating results of Hitachi GST for the twelve months ended December 31, 2010.

*12	Hitachi GST’s operating currency is U.S. dollar. Yen figures include yen / dollar conversion fluctuation.

*13	Shipment less than 100,000 units have been rounded, with the exception of Emerging and External HDD, where shipment less than 10,000 units have been rounded.