Eisai Co., Ltd. Annual Report 2001 - Eisai GmbH

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34 Note 7. Retirement and Pension Plans The Company and certain consolidated subsidiaries have severance payment plans for employees, directors and corporate auditors. Under most circumstances, employees terminating their employment are entitled to retirement benefits determined based on the rate of pay at the time of termination, years of service and certain other factors. Such retirement benefits are made in the form of a lump-sum severance payment from the Company or from certain consolidated subsidiaries and/or annuity payments from a trustee. Employees are entitled to larger payments if the termination is involuntary, by retirement at the mandatory retirement age, by death, or by voluntary retirement at certain specific ages prior to the mandatory retirement age. The liability for retirement benefits at March 31, 2001 for directors and corporate auditors is ¥1,946 million ($15,693 thousand). The retirement benefits for directors and corporate auditors are paid subject to the approval of the shareholders. Effective April 1, 2000, the Company and its consolidated domestic subsidiaries adopted a new accounting standard for employees’ retirement benefits. The liability for employees’ retirement benefits at March 31, 2001 consisted of the followings: Thousands of Millions of yen U.S. dollars Projected benefit obligation ¥131,937 $1,064,008 Fair value of plan assets (82,053) (661,718) Unrecognized transitional obligation (14,401) (116,137) Unrecognized actuarial loss (17,963) (144,863) Unrecognized prior service cost 13,884 111,968 Net liability ¥ 31,404 $ 253,258 The components of net periodic retirement benefit costs for the year ended March 31, 2001 are as follows: Millions of yen Thousands of U.S. dollars Service cost ¥ 5,670 $ 45,726 Interest cost 4,735 38,186 Expected return on plan assets (2,987) (24,089) Amortization of transitional obligation 18,728 151,032 Amortization of prior service cost (1,543) (12,444) Contribution and others 390 3,145 Net periodic retirement benefit costs ¥24,993 $201,556 Assumptions used for the year ended March 31, 2001 are set forth as follows: Discount rate 3.5% Expected rate of return on plan assets 4.0% Amortization period of prior service cost 5 years Recognition period of actuarial gain / loss 5 years Amortization period of transitional obligation 5 years The amount contributed to the fund and charged to income for the year ended March 31, 2000 was ¥4,050 million. Note 8. Shareholders’ Equity Common Stock and Additional Paid-in Capital The changes in the number of issued shares of common stock during the years ended March 31, 2001 and 2000, were as follows: 2001 2000 Balance, beginning of year 296,450,675 296,414,231 Shares issued upon conversion of bonds 2,313 36,444 Balance, end of year 296,452,988 296,450,675 Under the Japanese Commercial Code (the “Code”), an amount comprising at least 50% of the issue price of new shares, with a minimum of the par value thereof, is required to be designated as stated capital. The portion which is designated as stated capital is determined by resolution of the Board of Directors. Proceeds in excess of amounts designated as stated capital are credited to additional paid-in capital. Under the Code, the Company may issue new shares of common stock to the existing shareholders without consideration, by resolution of the Board of Directors, to the extent that the amount calculated by multiplying the number of outstanding shares after the issuance by par value per share does not exceed the stated capital, and that the amount calculated by dividing the total amount of shareholders’ equity by the number of outstanding shares after the issuance shall not be less than ¥50. These issuances of the new shares are treated as stock splits. Retained Earnings The Code provides that an amount at least equal to 10% of the aggregate amount of cash dividends and certain other cash payments which are made as appropriation of the retained earnings applicable to each fiscal period shall be aprropriated and set aside as a legal reserve until such reserve equals 25% of the stated capital. This reserve amount, which is included in retained earnings, totals ¥7,622 million ($61,468 thousand) and ¥6,948 million as of March 31, 2001 and 2000, respectively, and is not available for dividends but may be used to reduce a deficit by resolution of the shareholders. Eisai Annual Report 2001
The amount available for dividends under the Code is based on retained earnings excluding legal reserve as recorded on the books of the Company. At March 31, 2001, retained earnings of the Company included ¥219,005 million ($1,766,169 thousand), which was designated as both general and special reserves but available for future dividends subject to approval by the shareholders and legal reserve requirements. Year-end dividends are approved by the shareholders at a meeting held subsequent to the fiscal year to which the dividends are applicable. In addition, a semiannual dividend may be paid upon resolution of the Board of Directors, subject to certain limitations imposed by the Code. Stock option plan for the Company’s directors and applicable persons The Company’s nine Board of Directors’ members were allocated options for a maximum of 69,000 new common stocks and 17 other applicable persons in the Company will be allocated options for a maximum of 78,000 new common stocks. After the date of the option grant, in the event that a stock split or a consolidation of stocks occurs, an adjustment in stock options granted will be made in accordance with the rate of stock split or stock consolidation. In addition, after the date of the stock option grant, in the event the Company merges or consolidates with another company, the number of options granted will be adjusted as deemed necessary. The stock option exercise price of the newly issued stock for the purpose of the stock option is ¥3,090 ($24.92). After the date of the option grant, in the event of a stock split or stock consolidation, the stock option excercise price will be adjusted according to the percentage change with amounts of less than one yen being rounded up. In addition, after the stock option grant, if the Company issues new stocks at the price less than the current price on the market (excluding new stock issuance for convertible bonds redemption, warrants with pre-emptive rights and the application of the Code 280- 19), the exercise price will be adjusted with amounts of less than one yen being rounded up. Such stock options can be exercised from September 1, 2000 to June 29, 2010. Note 9. Transactions with an Unconsolidated Subsidiary and Associated Companies Transactions of the Group with an unconsolidated subsidiary and associated companies which are mainly engaged in the sales and purchases of pharmaceuticals for the years ended March 31, 2001 and 2000, are summarized as follows: Thousands of Millions of yen U.S. dollars 2001 2000 2001 Sales ¥ 113 ¥ 320 $ 911 Purchases 6,173 6,370 49,782 Note 10. Leases The Group leases certain equipment, computers, office space and other assets. (a) Pro forma information concerning leased property of financial leases that do not transfer ownership of the leased property to the lessee on an “as if capitalized” basis for the years ended March 31, 2001 and 2000, was as follows: I. Acquisition cost, Accumulated depreciation, Net leased property Millions of yen Thousands of U.S. dollars 2001 2001 Buildings Machinery Buildings Machinery and structures and equipment Total and structures and equipment Total Acquisition cost ¥3 ¥4,646 ¥4,649 $24 $37,468 $37,492 Accumulated depreciation 1 2,809 2,810 8 22,653 22,661 Net leased property ¥2 ¥1,837 ¥1,839 $16 $14,815 $14,831 Millions of yen 2000 Buildings Machinery and structures and equipment Total Acquisition cost ¥3 ¥5,706 ¥5,709 Accumulated depreciation 1 3,010 3,011 Net leased property ¥2 ¥2,696 ¥2,698 II. Obligations under finance leases Eisai Annual Report 2001 Millions of yen Thousands of U.S. dollars 2001 2000 2001 Due within one year ¥ 841 ¥1,207 $ 6,782 Due after one year 1,022 1,541 8,242 Total ¥1,863 ¥2,748 $15,024 35
Page 1 and 2: Human Health Care The script for ou
Page 3 and 4: CONSOLIDATED FINANCIAL HIGHLIGHTS E
Page 5 and 6: In Japan, we are proceeding with de
Page 7 and 8: Fiscal 2001 marks the conclusion of
Page 9 and 10: humanity-based sales activities the
Page 11 and 12: Selected Research Candidates (As of
Page 13 and 14: working together to develop antican
Page 15 and 16: REVIEW OF OPERATIONS PHARMACEUTICAL
Page 17 and 18: Consumer Health Care Products The c
Page 19 and 20: REINFORCING OUR RELATIONSHIP WITH S
Page 21 and 22: FINANCIAL SECTION Contents 20 Finan
Page 23: Net Income Current income taxes for
Page 26 and 27: 24 CONSOLIDATED FINANCIAL STATEMENT
Page 28 and 29: 26 Consolidated Statements of Incom
Page 30 and 31: 28 Consolidated Statements of Cash
Page 32 and 33: 30 (e) Property, plant and equipmen
Page 34 and 35: 32 Proceeds from sales of available
Page 38 and 39: 36 III. Actual lease payments, Depr
Page 40 and 41: 38 Eisai Annual Report 2001 Million
Page 42 and 43: 40 JAPAN AND OVERSEAS OPERATIONS No
Page 44 and 45: 42 MAJOR PRODUCTS Prescription Phar
Page 46 and 47: 44 CORPORATE INFORMATION (As of Mar

Eisai Co., Ltd. Annual Report 2001 - Eisai GmbH

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