A N N U A L R E P O R T 1 9 9 9

Interest Rate Contracts
1998 Millions of yen
Notional amounts
Due within one year Due after one year Total Fair value Unrealized gain (loss)
Interest rate swap contracts—
Pay floating rate, receive floating rate ¥1,000 ¥6,000 ¥7,000 ¥(2) ¥(2)
Pay floating rate, receive fixed rate — — — — —
Total ¥1,000 ¥6,000 ¥7,000 ¥(2) ¥(2)
1999 Millions of yen
Notional amounts
Due within one year Due after one year Total Fair value Unrealized gain (loss)
Interest rate swap contracts—
Pay floating rate, receive floating rate ¥6,000 ¥ — ¥ 6,000 ¥3 ¥3
Pay floating rate, receive fixed rate — 10,000 10,000 1 1
Total ¥6,000 ¥10,000 ¥16,000 ¥4 ¥4
Thousand of U.S. dollars
Notional amounts
Due within one year Due after one year Total Fair value Unrealized gain
Interest rate swap contracts—
Pay floating rate, receive floating rate $49,587 $ — $ 49,587 $25 $25
Pay floating rate, receive fixed rate — 82,645 82,645 8 8
Total $49,587 $82,645 $132,232 $33 $33
The above table excludes all the forward exchange contracts
entered into to hedge receivables and payables denominated
in foreign currencies, since they have been translated
and reflected at the corresponding contracted rates in the
accompanying balance sheets as of March 31, 1998 and 1999.
The fair value of interest swap contracts has been required to
be disclosed from fiscal 1998.
8. Commitments and Contingent Liabilities
Commitments outstanding as at March 31, 1999, for capital expenditures
approximated ¥58,966 million ($487,322 thousand).
As at March 31, 1999, the Company and its subsidiaries
were contingently liable for trade notes receivable discounted
with banks of ¥42 million ($347 thousand). The average interest
rate of the notes discounted with banks was 1.8% per
annum as at March 31, 1999.
The Company and its subsidiaries were also contingently
liable as guarantors for the borrowings of certain subsidiaries,
affiliates and subcontractors, amounting to ¥2,472 million
($20,430 thousand) as at March 31, 1999.
The Company and its consolidated subsidiaries had cancellable
and non-cancellable long-term lease agreements, principally for
office space and computer equipment. Annual rental expenses for
the year ended March 31, 1999, were ¥18,249 million ($150,818
thousand).
9. Segment Information
The Company conducts various printing activities classified as the
“printing” segment and non-printing activities classified as the
“other” segment.
A summary of net sales, costs and expenses and operating
income by segment of business activities for the years ended March
31, 1997, 1998 and 1999, is shown on the next page.
As described in Note 1 (Depreciation), effective April 1, 1998,
the Company changed its depreciation method for buildings,
excluding building fixtures, from the declining-balance method to
the straight-line method. As a result of this change, operating
income and assets of the Printing segment for the year ended
March 31, 1999, increased by ¥2,651 million ($21,909 thousand)
and ¥3,233 million ($26,719 thousand), respectively.
Also, as described in Note 1 (Depreciation), effective April 1,
1998, the Company shortened the estimated useful lives of buildings,
excluding building fixtures. As a result of this change, operating
income and assets of the Printing segment decreased by ¥701
million ($5,793 thousand) and ¥833 million ($6,884 thousand),
respectively.
Also, as described in Note 1 (Allowance for doubtful receivables),
effective from the year ended March 31, 1999, the
Company changed the policy for providing the allowance for
doubtful receivables from using the formula provided by the
Corporation Tax Law to applying a percentage based on collection
experience to the remaining account. As a result of this change,
operating income and assets of the Printing segment increased by
¥434 million ($3,587 thousand) and ¥1,868 million ($15,438
thousand), respectively. Also, operating income and assets of the
Other segment increased by ¥28 million ($231 thousand) and
¥136 million ($1,124 thousand), respectively.
Geographical segment information was not presented as the
sales and assets of consolidated domestic subsidiaries for the years
ended March 31, 1997, 1998 and 1999 exceed 90% of consolidated
net sales and assets.
The overseas sales of the Company and its consolidated
subsidiaries for the years ended March 31, 1997, 1998 and
1999, were less than 10% of consolidated net sales.
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