(1) Accounting Principles, Procedures and the Presentation of the Consolidated Financial Statements
|
(a)
|
Terminology, Form and Method of Preparation of the Consolidated Financial Statements
|
Advantest Corporation (the “Company”) and its consolidated subsidiaries (collectively, “Advantest”) prepare its consolidated financial statements in accordance with generally accepted accounting principles in the United States of America (“U.S. GAAP”). U.S. GAAP is codified in the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”), which is the source of authoritative accounting principles recognized by the FASB.
Advantest prepared the accompanying interim consolidated financial statements in conformity with U.S. GAAP, consistent in all material respects with those applied in Advantest’s Annual Report on Form 20-F for the year ended March 31, 2015.
The interim financial statements are unaudited, but reflect all normal adjustments that are, in the opinion of management, necessary to provide a fair presentation of results for the interim periods presented. This interim information should be read with the consolidated financial statements in Advantest’s Annual Report on Form 20-F for the year ended March 31, 2015.
|
(b)
|
Preparation of the Consolidated Financial Statements and Registration with the U.S. Securities and Exchange Commission
|
The Company became listed on the New York Stock Exchange on September 17, 2001 (local time) by means of an issuance of American Depository Shares, and has been filing a Form 20-F (equivalent to the Annual Securities Report in Japan) with the U.S. Securities and Exchange Commission since the year ended March 31, 2002. Advantest prepares the consolidated financial statements in its Form 20-F in accordance with U.S. GAAP.
|
(c)
|
Significant differences from the preparation of financial statements under Japanese GAAP
|
Of the accounting principles, procedures and method of presentation adopted by Advantest, the following is a brief summary description of certain significant differences from the preparation of financial statements using the accounting principles, procedures and methods of presentation under Japanese GAAP, as required under the Financial Instruments and Exchange Law of Japan:
(i) Allowance for compensated absences
An allowance is provided for the right of employees to receive compensated absences in the future.
(ii) Business Combination
Goodwill arising from business combination is not amortized, but instead is tested for impairment at least annually. Acquisition related costs are expensed as incurred.
(iii) Stock option
Unused gains from stock based compensation are not recognized upon expiration of stock option.
ADVANTEST CORPORATION
AND SUBSIDIARIES
Notes to Consolidated Financial Statements (Unaudited)
(2) Description of Business and Summary of Significant Accounting Policies and Practices
|
|
(a)
|
Description of Business
|
Advantest manufactures and sells semiconductor and component test system products and mechatronics-related products such as test handlers and device interfaces. Advantest also engages in research and development activities and provides maintenance and support services associated with these products.
Description of the business by segment is as follows:
The semiconductor and component test system segment provides customers with test system products for the semiconductor industry and the electronic parts industry. Product lines provided in the semiconductor and component test system segment include test systems for SoC (“System-on-a-Chip”) semiconductors for non memory semiconductor devices and test systems for memory semiconductors for memory semiconductor devices.
The mechatronics system segment provides product lines such as test handlers, mechatronic-applied products for handling semiconductor devices, device interfaces that serve as interfaces with the devices that are measured and operations related to nano-technology products.
The services, support and others segment consists of comprehensive customer solutions provided in connection with the above segments, support services, equipment lease business and others.
|
|
(b)
|
Accounting Changes and Accounting Standards Not Yet Adopted
|
In May 2014, the FASB issued the accounting standard for revenue from contracts with customers. This standard supersedes virtually all existing revenue recognition requirements under U.S. GAAP and requires an entity to apply the five steps to recognize revenue from contracts with customers unless the contracts are in the scope of other U.S. GAAP requirements. Additionally, an entity should disclose quantitatively and qualitatively sufficient information including contract with customers, significant judgments, and assets recognized from the costs to obtain or fulfill a contract. The entity should apply the amendments in this standard using one of the following two methods; retrospectively to each prior reporting period presented or retrospectively with the cumulative effect of initially applying this standard recognized at the date of the initial application. This standard was originally planned to be effective for annual reporting periods beginning after December 15, 2016, however, in April 2015, the FASB proposed a one-year delay in the effective date and the proposition was officially determined in July 2015. Early adoption as of the original effective date is permitted. Advantest is currently evaluating the adoption date and the effect that this adoption will have on its consolidated results of operations and financial condition.
ADVANTEST CORPORATION
AND SUBSIDIARIES
Notes to Consolidated Financial Statements (Unaudited)
Certain reclassifications have been made to the prior fiscal year’s consolidated financial statements to conform to the current quarter presentation.
(3) Inventories
Inventories at March 31, 2015 and June 30, 2015 were composed of the following:
| |
|
Yen (Millions)
|
| |
|
March 31, 2015
|
|
|
June 30, 2015
|
|
| |
|
|
|
|
|
|
|
Finished goods
|
|
¥ |
12,287 |
|
|
|
13,515 |
|
|
Work in process
|
|
|
12,999 |
|
|
|
15,165 |
|
|
Raw materials and supplies
|
|
|
11,924 |
|
|
13,235
|
|
| |
|
|
|
|
|
|
|
|
| |
|
¥ |
37,210 |
|
|
41,915
|
|
(4) Investment Securities
Marketable equity securities are classified as available-for-sale securities. The acquisition cost, gross unrealized gains, gross unrealized losses and fair value at March 31, 2015 and June 30, 2015 were as follows:
| |
|
Yen (Millions)
|
|
| |
|
March 31, 2015
|
|
| |
|
|
|
| |
|
Acquisition
cost
|
|
|
Gross
unrealized gains
|
|
|
Gross
unrealized losses
|
|
|
Fair value
|
|
|
Noncurrent:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Available-for-sale:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity securities
|
|
¥ |
987 |
|
|
|
786 |
|
|
|
- |
|
|
|
1,773 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
|
Yen (Millions)
|
|
| |
|
June 30, 2015
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
Noncurrent:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Available-for-sale:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity securities
|
|
¥ |
989 |
|
|
|
1,103 |
|
|
|
26 |
|
|
|
2,066 |
|
Equity securities consist primarily of stocks issued by Japanese listed companies.
Proceeds from the sale of available-for-sale securities and gross realized gains on available-for-sale securities for the three months ended June 30, 2014 were ¥1,292 million and ¥559 million, respectively. There were no proceeds from the sale of available-for-sale securities and gross realized gains on available-for-sale securities for the three months ended June 30, 2015. No losses were realized on the sale of available-for-sale securities for the three months ended June 30, 2014 and 2015, respectively.
ADVANTEST CORPORATION
AND SUBSIDIARIES
Notes to Consolidated Financial Statements (Unaudited)
Gross unrealized losses on available-for-sale securities and the fair value of the related securities, aggregated by length of time that individual securities have been in a continuous unrealized loss position, at March 31, 2015 and June 30, 2015, were as follows:
| |
|
Yen (Millions)
|
|
| |
|
March 31, 2015
|
|
| |
|
Less than 12 months
|
|
|
12 months or longer
|
|
| |
|
Fair value
|
|
|
Gross
unrealized
losses
|
|
|
Fair value
|
|
|
Gross
unrealized
losses
|
|
|
Noncurrent:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Available-for-sale:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity securities
|
|
¥ |
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
| |
|
Yen (Millions)
|
|
| |
|
June 30, 2015
|
|
| |
|
Less than 12 months
|
|
|
12 months or longer
|
|
| |
|
Fair value
|
|
|
Gross
unrealized
losses
|
|
|
Fair value
|
|
|
Gross
unrealized
losses
|
|
|
Noncurrent:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Available-for-sale:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity securities
|
|
¥ |
86 |
|
|
|
26 |
|
|
|
- |
|
|
|
- |
|
Advantest maintains non-marketable equity securities, which are recorded at cost and included in “investment securities” in the consolidated balance sheets. The carrying amounts of non-marketable equity securities were ¥476 million and ¥477 million at March 31, 2015 and June 30, 2015, respectively. Advantest had not estimated the fair value of these non-marketable equity securities aggregating ¥476 million and ¥477 million at March 31, 2015 and June 30, 2015, respectively, since it was not practicable to estimate the fair value of the investments due to the lack of readily determinable fair values and difficulty in estimating fair value without incurring excessive cost. Non-marketable equity securities that had impairment indicators were evaluated to determine whether the investments were impaired and the impairment, if any, was other than temporary.
(5) Derivative Financial Instruments
|
|
Advantest uses derivative instruments primarily to manage exposures to foreign currency. The primary objective in holding derivatives is to reduce the volatility of earnings and cash flows associated with changes in foreign currency. The instruments are not designated for trading or speculative purposes. Derivative financial instruments contain an element of risk in the event the counterparties are unable to meet the terms of the agreements. However, Advantest minimizes risk exposure by limiting the counterparties to major international banks and financial institutions meeting established credit guidelines. Management of Advantest does not expect any counterparty to default on its obligations and, therefore, does not expect to incur any losses due to counterparty default on its obligations. Advantest generally does not require or place collateral for these derivative financial instruments.
|
ADVANTEST CORPORATION
AND SUBSIDIARIES
Notes to Consolidated Financial Statements (Unaudited)
|
|
Advantest recognizes derivative instruments as either assets or liabilities on the consolidated balance sheet at fair value. Changes in fair value of the derivatives are recorded as other income (expense).
|
Derivatives not designated as hedging instruments
Derivatives not designated as hedging instruments consist primarily of foreign exchange forward contracts to reduce Advantest’s risk associated with exchange rate fluctuations, as gains and losses on these contracts are intended to offset exchange losses and gains on underlying exposures. Changes in fair value of foreign exchange contracts are recognized in earnings under the caption of other income (expense).
There were neither outstanding foreign exchange contracts to exchange currencies among Japanese yen, US dollar and Euro nor balances on the consolidated balance sheet at March 31, 2015 and June 30, 2015.
Effect of derivative instruments on the consolidated statements of operations
Derivatives not designated as hedging instruments
The effects of derivatives not designated as hedging instruments on the consolidated statements of operations for the three months ended June 30, 2014 and 2015 were as follows:
| |
|
|
Yen (Millions)
|
| |
Location of
gain (loss)
|
|
Amount of gain (loss) recognized in
income on derivatives
|
| |
recognized in
income on
derivatives
|
|
Three months ended
June 30, 2014
|
|
Three months ended
June 30, 2015
|
| |
|
|
|
|
|
|
|
|
|
|
Foreign exchange contracts
|
Other income
|
|
¥ |
14 |
|
|
|
4 |
|
(6) Fair Value Measurement
Disclosure about the fair value of Financial Instruments
The following table presents the carrying amounts and estimated fair values of Advantest’s financial instruments at March 31, 2015 and June 30, 2015. Fair value estimates are made at a specific point in time based on relevant market information and information about the financial instrument. These estimates are subjective in nature and involve uncertainties and matters of significant judgment and, therefore, cannot be determined with precision. Changes in assumptions could significantly affect the estimates.
ADVANTEST CORPORATION
AND SUBSIDIARIES
Notes to Consolidated Financial Statements (Unaudited)
| |
|
Yen (Millions)
|
|
| |
|
March 31, 2015
|
|
|
June 30, 2015
|
|
| |
|
Carrying
amount
|
|
|
Fair
value
|
|
|
Carrying
amount
|
|
|
Fair
value
|
|
|
Financial assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Investment securities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Available-for-sale securities
|
|
¥ |
1,773 |
|
|
|
1,773 |
|
|
|
2,066 |
|
|
|
2,066 |
|
|
Financial liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Corporate bonds
(Including current portion)
|
|
|
25,000 |
|
|
|
25,024 |
|
|
|
15,000 |
|
|
|
15,060 |
|
|
Convertible bonds
|
|
|
30,119 |
|
|
|
33,555 |
|
|
|
30,111 |
|
|
|
30,870 |
|
The carrying amounts of available-for-sale securities are included in the consolidated balance sheets under investment securities.
The following methods and assumptions are used to estimate the fair value of each class of financial instruments:
Cash and cash equivalents, trade receivables and trade accounts payable: The carrying amounts approximate fair value because of the short maturity of these instruments.
Available-for-sale securities: The fair values of available-for-sale equity securities are based on quoted market prices at the reporting date for those investments.
Corporate bonds (including current portion) and convertible bonds: The fair values of corporate bonds (including current portion) and convertible bonds are estimated using quoted market prices, and are classified as Level 2.
Fair Value Hierarchy
U.S. GAAP defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants at the measurement date. Additionally the inputs to valuation techniques used to measure fair value are prioritized into the following three levels:
Level 1 - Quoted prices (unadjusted) in active markets for identical assets or liabilities that the reporting entity has the ability to access at the measurement date.
Level 2 - Observable inputs other than quoted prices included within Level 1 for the asset or liability, either directly or indirectly.
Level 3 - Unobservable inputs for the asset or liability.
Assets / Liabilities Measured at Fair Value on a Recurring Basis
As of March 31, 2015 and June 30, 2015, the carrying amounts of assets and liabilities that were measured at fair value on a recurring basis by level was as follows:
ADVANTEST CORPORATION
AND SUBSIDIARIES
Notes to Consolidated Financial Statements (Unaudited)
| |
|
|
|
|
Yen (Millions)
|
|
| |
|
|
|
|
Fair Value Measurements
at March 31, 2015
|
|
| |
|
Total
|
|
|
Level 1
|
|
|
Level 2
|
|
|
Level 3
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
Assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Available-for-sale equity securities
|
|
¥ |
1,773 |
|
|
|
1,773 |
|
|
|
- |
|
|
|
- |
|
|
Total assets measured at fair value
|
|
|
1,773 |
|
|
|
1,773 |
|
|
|
- |
|
|
|
- |
|
| |
|
|
|
|
Yen (Millions)
|
|
| |
|
|
|
|
Fair Value Measurements
at June 30, 2015
|
|
| |
|
Total
|
|
|
Level 1
|
|
|
Level 2
|
|
|
Level 3
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
Assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Available-for-sale equity securities
|
|
¥ |
2,066 |
|
|
|
2,066 |
|
|
|
- |
|
|
|
- |
|
|
Total assets measured at fair value
|
|
|
2,066 |
|
|
|
2,066 |
|
|
|
- |
|
|
|
- |
|
As of March 31, 2015 and June 30, 2015, there were no amount of liabilities, which were measured at fair value on a recurring basis.
Adjustments to fair value of available-for-sale equity securities are recorded as an increase or decrease, net of tax, in accumulated other comprehensive income (loss) except where losses are considered to be other than temporary, in which case the losses are recorded in impairment losses on investment securities.
Assets / Liabilities Measured at Fair Value on a Nonrecurring Basis
As of March 31, 2015, the carrying amount of assets and liabilities, which were measured at fair value on a nonrecurring basis by level during the year ended March 31, 2015 was as follows:
| |
|
|
|
|
Yen (Millions)
|
|
| |
|
|
|
|
Fair Value Measurements
at March 31, 2015
|
|
| |
|
Total
|
|
|
Level 1
|
|
|
Level 2
|
|
|
Level 3
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
Assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Assets held for sale
|
|
¥ |
122 |
|
|
|
- |
|
|
|
- |
|
|
|
122 |
|
|
Total assets measured at fair value
|
|
|
122 |
|
|
|
- |
|
|
|
- |
|
|
|
122 |
|
ADVANTEST CORPORATION
AND SUBSIDIARIES
Notes to Consolidated Financial Statements (Unaudited)
As of June 30, 2015, there were no amount of assets and liabilities, which were measured at fair value on a nonrecurring basis.
The fair value of the assets held for sale was determined based on a third-party appraisal using similar assets and sales. The fair value is classified as Level 3 because significant unobservable inputs were involved in the fair value measurements.
(7) Corporate Bonds and Convertible Bonds
The carrying values of corporate bonds and convertible bonds at March 31, 2015 and June 30, 2015 were as follows:
| |
|
Yen (Millions)
|
|
| |
|
March 31, 2015
|
|
|
June 30, 2015
|
|
| |
|
|
|
|
|
|
|
Unsecured 0.416% bonds, due May 25, 2015
|
|
¥ |
10,000 |
|
|
|
- |
|
|
Unsecured 0.606% bonds, due May 25, 2017
|
|
|
15,000 |
|
|
|
15,000 |
|
|
Corporate bonds
|
|
¥ |
25,000 |
|
|
|
15,000 |
|
| |
|
|
|
|
|
|
|
|
|
Unsecured zero coupon convertible bonds,
due March 14, 2019
|
|
¥ |
30,000 |
|
|
|
30,000 |
|
|
Add unamortized premium
|
|
|
119 |
|
|
|
111 |
|
|
Convertible bonds
|
|
¥ |
30,119 |
|
|
|
30,111 |
|
The unsecured bonds, due May 25, 2015, were repaid in full as scheduled.
In March 2014, the Company issued ¥30,000 million zero coupon convertible bonds due 2019 (the “Zero Coupon Convertible Bonds”). The bondholders are entitled to stock acquisition rights effective from April 1, 2014 to February 28, 2019. The initial conversion price is ¥1,655 per common share. Aside from the standard anti-dilution provisions, the conversion price is reduced for a certain period before an early redemption is triggered upon the occurrence of certain corporate events including a merger, corporate split, delisting and squeeze-out event. The reduced amount of the conversion price will be determined by a formula which is based on the effective date of the reduction and the Company’s common stock price. The reduced conversion price ranges from ¥1,123 to ¥1,655 per common share. The conversion price is also adjusted for dividends in excess of 15 yen per common share per fiscal year. The bondholders may require the Company to redeem the Zero Coupon Convertible Bonds, on or after a reduction in the conversion price is triggered, at 100.0% of its principal amount, together with a redemption premium which begins at 3.0% of the principal amount and ends at zero, amortized on a straight-line basis over the term of the Zero Coupon Convertible Bonds. In addition, the Company has the option to redeem all of the Zero Coupon Convertible Bonds outstanding at 100.0% of the principal amount, if less than 10.0% of the original issuance is outstanding.
(8) Income Taxes
As of June 30, 2014 and 2015, the estimated annual effective tax rate for FY2014 and FY2015 differ from the 35.4 and 32.8 percent statutory income tax rate primarily due to related impacts of valuation allowance on deferred tax assets, effects of foreign income tax rates, and effects of separate company income tax reporting positions.
ADVANTEST CORPORATION
AND SUBSIDIARIES
Notes to Consolidated Financial Statements (Unaudited)
(9) Other Comprehensive Income (Loss)
Changes in accumulated other comprehensive income (loss) for the three months ended June 30, 2014 and 2015 were as follows:
| |
|
Yen (Millions)
|
|
| |
|
Three months ended June 30, 2014
|
|
| |
|
Foreign currency translation adjustment
|
|
|
Net unrealized gains (losses) on investment securities
|
|
|
Pension related adjustment
|
|
|
Accumulated other comprehensive income (loss)
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance at March 31, 2014
|
|
¥ |
16,489 |
|
|
|
907 |
|
|
|
(12,070 |
) |
|
|
5,326 |
|
Other comprehensive income
(loss) before reclassifications
|
|
|
(2,066 |
) |
|
|
106 |
|
|
|
34 |
|
|
|
(1,926 |
) |
Amounts reclassified from
Accumulated other comprehensive
Income (loss)
|
|
－
|
|
|
|
(361 |
) |
|
|
246 |
|
|
|
(115 |
) |
|
Net change during the period
|
|
|
(2,066 |
) |
|
(255
|
) |
|
|
280 |
|
|
(2,041
|
) |
|
Balance at June 30, 2014
|
|
¥ |
14,423 |
|
|
|
652 |
|
|
|
(11,790 |
) |
|
|
3,285 |
|
| |
|
Yen (Millions)
|
|
| |
|
Three months ended June 30, 2015
|
|
| |
|
Foreign currency translation adjustment
|
|
|
Net unrealized gains (losses) on investment securities
|
|
|
Pension related adjustment
|
|
|
Accumulated other comprehensive income (loss)
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance at March 31, 2015
|
|
¥ |
33,963 |
|
|
|
641 |
|
|
|
(16,217 |
) |
|
|
18,387 |
|
Other comprehensive income
(loss) before reclassifications
|
|
|
3,377 |
|
|
|
197 |
|
|
|
0 |
|
|
|
3,574 |
|
Amounts reclassified from
Accumulated other comprehensive
Income (loss)
|
|
－
|
|
|
－
|
|
|
|
365 |
|
|
|
365 |
|
|
Net change during the period
|
|
|
3,377 |
|
|
|
197 |
|
|
|
365 |
|
|
3,939
|
|
|
Balance at June 30, 2015
|
|
¥ |
37,340 |
|
|
|
838 |
|
|
|
(15,852 |
) |
|
|
22,326 |
|
ADVANTEST CORPORATION
AND SUBSIDIARIES
Notes to Consolidated Financial Statements (Unaudited)
Reclassifications out of accumulated other comprehensive income (loss) for the three months ended June 30, 2014 and 2015 were as follow:
| |
|
Yen (Millions)
|
|
| |
|
Amount reclassified from accumulated other comprehensive income (loss) (1)
|
|
| |
|
Three months ended
June 30, 2014
|
|
Three months ended
June 30, 2015
|
|
Affected line items in consolidated statements of operations
|
|
| |
|
|
|
|
|
|
|
|
|
Unrealized gains and
losses on investment securities
|
|
¥ |
(559 |
) |
|
－
|
|
|
Other income (expense):
Other, net
|
|
| |
|
|
198 |
|
|
－
|
|
|
Income taxes
|
|
| |
|
|
(361 |
) |
|
－
|
|
|
Net income (loss)
|
|
| |
|
|
|
|
|
|
|
|
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
Pension liability adjustments
|
|
|
|
|
|
|
|
|
|
|
|
Amortization of actuarial loss
|
|
|
322 |
|
|
|
487 |
|
|
(2) |
|
|
Amortization of prior service cost
|
|
|
(42 |
) |
|
|
(42 |
) |
|
(2) |
|
| |
|
|
(34 |
) |
|
|
(80 |
) |
|
Income taxes
|
|
| |
|
|
246 |
|
|
|
365 |
|
|
Net income
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
Total amount reclassified, net of tax
|
|
¥ |
(115 |
) |
|
|
365 |
|
|
|
|
|
|
(1)
|
Amounts in parentheses indicate gain in consolidated statements of operations.
|
|
(2)
|
The accumulated other comprehensive income components are included in the computation of net periodic pension cost (see note 10 for additional details).
|
ADVANTEST CORPORATION
AND SUBSIDIARIES
Notes to Consolidated Financial Statements (Unaudited)
(10) Accrued Pension and Severance Costs
The components of net periodic benefit cost recognized were as follows:
| |
|
Yen (Millions)
|
|
| |
|
Three months ended
|
|
| |
|
June 30, 2014
|
|
|
June 30, 2015
|
|
| |
|
Japanese
Plans
|
|
|
Non-Japanese
Plans
|
|
|
Japanese
Plans
|
|
|
Non-Japanese
Plans
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
Service cost
|
|
¥ |
444 |
|
|
|
134 |
|
|
|
471 |
|
|
|
181 |
|
|
Interest cost
|
|
|
151 |
|
|
|
133 |
|
|
|
128 |
|
|
|
90 |
|
|
Expected return on plan assets
|
|
|
(167 |
) |
|
|
(101 |
) |
|
|
(235 |
) |
|
|
(106 |
) |
|
Amortization of unrecognized:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net actuarial (gain) or loss
|
|
|
224 |
|
|
|
98 |
|
|
|
226 |
|
|
|
261 |
|
|
Prior service (benefit) cost
|
|
|
(42 |
) |
|
－
|
|
|
|
(42 |
) |
|
－
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net periodic benefit cost
|
|
¥ |
610 |
|
|
|
264 |
|
|
|
548 |
|
|
|
426 |
|
(11) Dividends
Based on the resolution for the payment of year-end dividends at the Board of Directors meeting held on May 28, 2014, Advantest declared cash dividends totaling ¥871 million, or ¥5 per share of common stock on June 3, 2014 to stockholders of record on March 31, 2014.
Based on the resolution for the payment of year-end dividends at the Board of Directors meeting held on May 27, 2015, Advantest declared cash dividends totaling ¥1,745 million, or ¥10 per share of common stock on June 2, 2015 to stockholders of record on March 31, 2015.
(12) Accrued Warranty Expenses
Advantest’s products are generally subject to warranty, and Advantest provides an allowance for such estimated costs when product revenue is recognized. To provide for future repairs during warranty periods, estimated repair expenses over the warranty period are accrued based on the historical ratio of actual repair expenses to corresponding sales, and any facts and circumstances that occurred.
ADVANTEST CORPORATION
AND SUBSIDIARIES
Notes to Consolidated Financial Statements (Unaudited)
Changes in accrued warranty expenses for the three months ended June 30, 2014 and 2015 were summarized as follows:
| |
|
Yen (Millions)
|
|
| |
|
Three months ended
|
|
| |
|
June 30, 2014
|
|
|
June 30, 2015
|
|
| |
|
|
|
|
|
|
|
Balance at beginning of period
|
|
¥ |
1,589 |
|
|
|
1,525 |
|
|
Addition
|
|
|
512 |
|
|
|
802 |
|
|
Reduction
|
|
|
(669 |
) |
|
|
(733 |
) |
|
Translation adjustments
|
|
|
(4 |
) |
|
|
2 |
|
| |
|
|
|
|
|
|
|
|
|
Balance at end of period
|
|
¥ |
1,428 |
|
|
|
1,596 |
|
(13) Other income (expense)
Other income (expense) includes foreign exchange gains of ¥207 million and ¥24 million for the three months ended June 30, 2014 and 2015, respectively.
(14) Operating Segment Information
Advantest manufactures and sells semiconductor and component test system products and mechatronics-related products such as test handlers and device interfaces. Advantest also engages in research and development activities and provides maintenance and support services associated with these products. Advantest’s organizational structure consists of three reportable operating segments, which are the design, manufacturing, and sale of semiconductor and component test systems, mechatronics systems and services, support and others. These reportable operating segments are determined based on the nature of the products and the markets. Segment information is prepared on the same basis that Advantest’s management reviews financial information for operational decision making purposes.
Reportable operating segment information for the three months ended June 30, 2014 and 2015 was as follows:
| |
|
Yen (Millions)
|
|
| |
|
Three months ended June 30, 2014
|
|
| |
|
Semiconductor and Component Test System Business
|
|
|
Mechatronics System Business
|
|
|
Services, Support and Others
|
|
|
Elimination and Corporate
|
|
|
Total
|
|
|
Net sales to unaffiliated customers
|
|
¥ |
26,044 |
|
|
|
4,793 |
|
|
|
5,992 |
|
|
－
|
|
|
|
36,829 |
|
|
Inter-segment sales
|
|
－
|
|
|
－
|
|
|
－
|
|
|
－
|
|
|
－
|
|
|
Net sales
|
|
|
26,044 |
|
|
|
4,793 |
|
|
|
5,992 |
|
|
－
|
|
|
|
36,829 |
|
|
Operating income (loss) before stock option compensation expense
|
|
|
3,118 |
|
|
|
155 |
|
|
|
628 |
|
|
|
(1,499 |
) |
|
|
2,402 |
|
|
Adjustment:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stock option compensation expense
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
－
|
|
|
Operating income
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
¥ |
2,402 |
|
ADVANTEST CORPORATION
AND SUBSIDIARIES
Notes to Consolidated Financial Statements (Unaudited)
| |
|
Yen (Millions)
|
|
| |
|
Three months ended June 30, 2015
|
|
| |
|
Semiconductor and Component Test System Business
|
|
|
Mechatronics System Business
|
|
|
Services, Support and Others
|
|
|
Elimination and Corporate
|
|
|
Total
|
|
|
Net sales to unaffiliated customers
|
|
¥ |
24,673 |
|
|
|
8,810 |
|
|
|
6,794 |
|
|
－
|
|
|
|
40,277 |
|
|
Inter-segment sales
|
|
|
6 |
|
|
－
|
|
|
－
|
|
|
|
(6 |
) |
|
－
|
|
|
Net sales
|
|
|
24,679 |
|
|
|
8,810 |
|
|
|
6,794 |
|
|
|
(6 |
) |
|
|
40,277 |
|
|
Operating income (loss) before stock option compensation expense
|
|
|
1,420 |
|
|
|
1,899 |
|
|
|
731 |
|
|
|
(1,341 |
) |
|
|
2,709 |
|
|
Adjustment:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stock option compensation expense
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
－
|
|
|
Operating income
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
¥ |
2,709 |
|
Adjustments to operating income in Corporate principally represent corporate general and administrative expenses and research and development expenses related to fundamental research activities that are not allocated to operating segments.
Advantest uses the operating income (loss) before stock option compensation expense for management’s analysis of business segment results.
ADVANTEST CORPORATION
AND SUBSIDIARIES
Notes to Consolidated Financial Statements (Unaudited)
(15) Per Share Data
The following table sets forth the computation of basic and diluted net income per share for the three months ended June 30, 2014 and 2015:
| |
|
Yen (Millions)
except share and per share data
|
|
| |
|
Three months ended
|
|
Three months ended
|
| |
|
June 30, 2014
|
|
June 30, 2015
|
|
Numerator:
|
|
|
|
|
|
|
|
Net income
|
|
¥ |
1,339 |
|
|
|
1,903 |
|
|
Dilutive effect of exercise of convertible bonds
|
|
|
(4 |
) |
|
|
(4 |
) |
|
Diluted net income
|
|
|
1,335 |
|
|
|
1,899 |
|
| |
|
|
|
|
|
|
|
|
|
Denominator:
|
|
|
|
|
|
|
|
|
|
Basic weighted average shares of common stock outstanding
|
|
|
174,190,300 |
|
|
|
174,557,956 |
|
|
Dilutive effect of exercise of stock options
|
|
|
5,635 |
|
|
|
244,694 |
|
|
Dilutive effect of exercise of convertible bonds
|
|
|
18,126,888 |
|
|
|
18,126,888 |
|
|
Diluted weighted average shares of common stock outstanding
|
|
|
192,322,823 |
|
|
|
192,929,538 |
|
| |
|
|
|
|
|
|
|
|
|
Basic net income per share
|
|
¥ |
7.68 |
|
|
|
10.90 |
|
|
Diluted net income per share
|
|
¥ |
6.94 |
|
|
|
9.84 |
|
At June 30, 2014 and 2015, Advantest had outstanding stock options convertible into 6,860,033 and 3,979,067 shares of common stock, respectively, which were anti-dilutive and excluded from the calculation of diluted net income per share.