A Global, Leading Green Company That
Contents
02 To Our Shareholders
03 Financial Highlights
04 Corporate Strategy
06 At a Glance
Fiscal 2015 Overview
08 Review of Operations
08 Energy and Electric Systems
09 Industrial Automation
Systems
10 Information and
Communication Systems
11 Electronic Devices
12 Home Appliances
13
Research and Development /
Intellectual Property
16 Corporate Social Responsibility
19 Corporate Governance
21 Directors and Executive Officers
22 Organization
23 Major Subsidiaries and Affiliates
25 Financial Section
75
Corporate Data /
Shareholder Information
Enriches Society with Technology.
As the Mitsubishi Electric Group comes closer to celebrating
in fiscal 2021 the 100th anniversary of our founding, we will
contribute to the enrichment of society as a global, leading
green company.
By "enriching society," we mean creating a “people-friendly”
society where everyone can live their lives in safety, peace
of mind, health, and comfort—and at the same time an
“earth-friendly” society that reduces impact to the
environment by advancing the efficient use and reuse of
resources and energy.
We of the Mitsubishi Electric Group have come to provide
cutting-edge technologies and diverse businesses globally,
and on a broad scale of applications ranging from homes,
offices, and factories to social infrastructure and outer space.
“To pave the way to a better and brighter tomorrow”—
this will be our mindset for future efforts as we increase
collaboration within the Group and continually challenge
ourselves to innovate.
MITSUBISHI ELECTRIC CORPORATION ANNUAL REPORT 2015 01
To Our Shareholders
Looking back on the economic situation during the fiscal year
management targets. At the same time, our goal is to achieve
ended March 31, 2015 (hereinafter fiscal 2015), the recovery of
consolidated net sales of ¥5.0 trillion or more and an operating
Japan’s domestic economy, which mainly relied on personal con-
income ratio of 8% or more by fiscal 2021.
sumption, remained weak. Outside of Japan, while the pace of
The Mitsubishi Electric Group is committed to further expand-
economic growth slowed in China and some newly emerging
ing its business worldwide. As a global leading green company,
nations, expansion continued in North America, and European
we will pursue every avenue to develop operations in fields relat-
economies showed positive growth. Thus in general, economies
ed to the environment and energy, and social infrastructure. To
continued to experience modest expansion. Turning to move-
this end, we will build an optimal global business promotion
ments in foreign currency exchange rates, the yen remained
structure encompassing the Group as a whole and continue to
weak against the U.S. dollar and strong against the euro. Under
strengthen it on an ongoing basis. Specifically, we will focus on
these circumstances, the Mitsubishi Electric Group placed greater
bolstering business operations in Europe, the United States, and
emphasis than ever before on promoting growth strategies root-
China, and work diligently to respond to demand and capture
ed in its competitive advantages, as well as on efforts to boost its
market share in growth regions including India, Southeast Asia,
competitiveness and strengthen its management structure.
and Central and South America.
As a result, the Mitsubishi Electric Group recorded consolidated
Furthermore, we will endeavor to increase our corporate value
net sales of ¥4,323.0 billion in the fiscal year ended March 31,
by building a robust management structure that is capable of
2015, an increase of 7% compared to the previous fiscal year.
realizing “high-quality” growth and steadfastly promoting CSR-
Operating income increased 35% year-on-year to ¥317.6 billion,
related activities.
for a Group operating income ratio of 7.3%. Meanwhile, net
As we resolutely advance forward to achieve our goals, we ask
income increased 53% to ¥234.6 billion. Moving forward, we
for your continued support.
will carry out a variety of measures in effort to maintain a return
on equity (ROE) above 10% while keeping the ratio of interest-
bearing debt to total assets below 15%, in accordance with
02 MITSUBISHI ELECTRIC CORPORATION ANNUAL REPORT 2015
July 2015
President & CEO Masaki Sakuyama
Financial Highlights
Performance for the Year Ended March 31, 2015
Yen
(millions)
U.S. dollars
(thousands)
Years ended March 31
2015
2014
2013
Net sales
Operating income
Net income attributable to Mitsubishi Electric Corp.
Total assets
Interest-bearing debt
Mitsubishi Electric Corp. shareholders’ equity
Capital expenditures
R&D expenditures
Per-Share Amounts
Net income attributable to Mitsubishi Electric Corp.
Basic
Diluted
Cash dividends declared
Statistical Information
Operating income ratio
Return on equity (ROE)
Interest-bearing debt to total assets
¥4,323,041
317,604
234,694
4,059,451
381,994
1,842,203
199,758
195,314
¥4,054,359
235,172
153,473
3,612,966
373,478
1,524,322
151,840
178,945
¥3,567,184
152,095
69,517
3,410,410
540,572
1,300,070
150,425
172,222
2015
$36,025,342
2,646,700
1,955,783
33,828,758
3,183,282
15,351,692
1,664,650
1,627,617
Yen
U.S. dollars
¥109.32
¥71.49
¥32.38
—
27
7.3%
13.9
9.4
—
17
5.8%
10.9
10.3
—
11
%
4.3%
5.7
15.9
$0.911
—
0.225
—
—
—
See accompanying Notes to Consolidated Financial Statements on page 41.
1 The Company prepares consolidated financial statements with procedures, accounting terms, forms, and preparation that are in conformity with accounting principles
generally accepted in the United States of America based on the rules and regulations applicable in Japan.
2 Operating income is presented as net sales less cost of sales, selling, general, administrative, and R&D expenses, and loss on impairment of long-lived assets.
3 Diluted net income per share attributable to Mitsubishi Electric Corp. is not included in the above figure as no dilutive securities existed.
4 U.S. dollar amounts are converted from yen at the rate of ¥120=U.S.$1, the approximate rate on the Tokyo Foreign Exchange Market on March 31, 2015.
Net Sales Breakdown by Business Segment
14.8%
Others
Net sales ¥740,517 million
Energy and Electric Systems 24.6%
Net sales
¥1,228,958 million
Home Appliances 18.9%
Net sales ¥944,830 million
Electronic Devices 4.8%
Net sales ¥238,402 million
Industrial Automation Systems 25.7%
¥1,282,749 million
Net sales
Information and
Communication Systems 11.2%
¥559,521 million
Net sales
MITSUBISHI ELECTRIC CORPORATION ANNUAL REPORT 2015 03
Corporate Strategy
The Mitsubishi Electric Group, based on its Corporate Mission
and Seven Guiding Principles, has positioned corporate social
responsibility (CSR) initiatives as the pillar of its corporate
management. It seeks to become a corporation that is trusted
by society, customers, shareholders, and employees, and that
earns their satisfaction through its business activities. At the
same time, the Group strives to simultaneously address the
need to create an environment in which people can live safe,
secure, and comfortable lives and promote a sustainable
society. Concerning CSR—in particular, corporate ethics and
compliance—the entire Mitsubishi Electric Group will continue
to strictly observe all statutory, regulatory, and ethical require-
ments while strengthening internal control. In addition, every
effort will be made to implement improvement measures,
including initiatives aimed at properly addressing Japan's
Corporate Governance Code.
Since fiscal 2002, the Mitsubishi Electric Group has continued
Management Policy
Maintain Balanced Corporate Management
for Sustainable Growth
Growth
• Accelerate the growth of
strong businesses
• Further global expansion
• Create new strong businesses
• Reinforce the solutions business
Greater
Corporate
Value
Profitability
Efficiency
• Enhance capital efficiency
• Create a stronger business
foundation
Soundness
• Constantly review and
refresh business portfolio
• Maintain sound financial
standing
• Promote thorough Ethics
and Compliance and
CSR initiatives
to pursue sustainable growth by undertaking balanced management initiatives that stem from the three perspectives of
growth, profitability and efficiency, and soundness. Looking ahead, the Group will carry out these initiatives while promot-
ing the global expansion of business in the areas of environment and energy- and social infrastructure- related systems. As a
global, leading green company, Mitsubishi Electric is committed to creating an affluent society, securing business growth,
and diligently working to increase corporate value.
Management Targets
In line with its efforts to achieve a higher level of growth, the
• Growth Targets to be Achieved by Fiscal 2021
Mitsubishi Electric Group has revised its growth targets for fiscal
2021 to consolidated net sales of ¥5.0 trillion or more and an
Net sales ¥5.0 trillion or more
Operating income ratio 8% or more
operating income ratio of 8% or more.
Looking ahead, the Group will also continue with efforts to
achieve the following management targets: secure an ROE of
10% or more and secure an interest-bearing debt to total assets
ratio of 15% or less.
• Management Targets to be Continuously and
Stably Achieved
ROE 10% or more
Ratio of interest-bearing debt to total assets 15% or less
Bolstering Growth Strategies: For a Higher Level of Growth
N Fundamental Concepts of the Group’s Growth Strategies
as control technologies and power electronics. In addition, the
The Mitsubishi Electric Group’s strength lies in its solid technology
Group possesses a solid business platform that encompasses
platform, which encompasses a wide range of technologies such
materials procurement, production, quality assurance, and sales
Overview of
Growth Strategies
Technological Assets
Control (motion, heat, fluid, and electricity)
Power Electronics
Human Machine Interface
Encryption
Communication
Electromagnetic Analysis
Sensing
Design
Devices
etc.
Technological Platform
R&D and IP
Mitsubishi Electric Group
s
e
i
g
r
e
n
y
S
l
l
a
c
i
g
o
o
n
h
c
e
T
(cid:31) Make Strong Businesses Stronger
(cid:31) Continuous Creation of New Strong Businesses
(cid:31) Reinforce the Solutions Business Centered on
Strong Businesses
s
e
i
g
r
e
n
y
S
s
s
e
n
i
s
u
B
Procurement
Productivity
Quality
Sales and Services
Operating Platform
Open & Global Innovation Enhance technological development capabilities through joint R&D initiatives
Universities
Corporations
National Research and Development Agency
Government
Standardization Organizations
04 MITSUBISHI ELECTRIC CORPORATION ANNUAL REPORT 2015
Management Policy
and services, in all of which a culture of improvement is firmly
In increasing the allocation of development, capital, and other
entrenched. The Mitsubishi Electric Group’s growth strategies are
investment resources, the Group will target businesses that are
built on its efforts to create technological and operating synergies
capable of quickly securing growth while generating short-term
by coordinating and combining operations between these plat-
investment benefits and exhibiting a high probability of expan-
forms consistently, as well as its efforts to make strong businesses
sion with little or no performance volatility. Additionally, aiming
stronger, continuously create new strong businesses, and rein-
to augment its growth, the Mitsubishi Electric Group will actively
force the solutions business centered on strong businesses.
pursue collaborative ties and M&As from the three perspectives
N Further Global Business Expansion
of: supplementing product groups and technology fields in which
the Group is lacking, to expand business; securing sales and ser-
The Mitsubishi Electric Group works actively to achieve stable
vice networks when advancing into new regions and markets;
growth and greater profitability in the Japanese market. The
and acquiring new customer segments in order to bolster the
Group’s principal operating market Japan accounts for
Group’s business platform.
approximately 60% of total net sales. In markets outside of
Japan, the Group will strengthen the competitiveness of opera-
N Initiatives for Creating New Businesses Capable
tions and expand its business scale in Europe, the United States,
of Driving Growth
and China, which form the nucleus of its global business
To ensure sustainable growth beyond fiscal 2021, the Mitsubishi
development endeavors.
Electric Group will work to maximize the operations of its
Furthermore, in order to realize an even higher level of growth,
overseas bases in Europe, the United States, and China, and
the Group will promote the cultivation of new markets by estab-
engage in joint research and development with external partners.
lishing business systems in newly emerging regions such as India,
Such efforts are in line with the Group‘s commitment to
Southeast Asia, and Central and South America.
forward-looking R&D aimed at creating new businesses that are
capable of driving future growth.
Toward “High-Quality” Growth
In fiscal 2015, the Mitsubishi Electric Group achieved record highs
in net sales and operating income on a consolidated basis.
Building a Robust Management Foundation
To strengthen its management foundation, the Mitsubishi Electric
Specifically, consolidated net sales and operating income totaled
Group will reallocate management resources to growth fields by
¥4,323.0 billion and ¥317.6 billion, respectively.
reviewing and refreshing its business portfolio and continuously
In addition, the Group continued to achieve its management
enhancing capital efficiency.
targets for ROE of 10% or more and a ratio of interest-bearing
As a part of the initiatives to enhance capital efficiency, the
debt to total assets of 15% or less, recording figures of 13.9%
Group will continue to expand net sales and reduce costs while
and 9.4%, respectively.
engaging in activities aimed at improving inventory turnover,
Moving forward, the Group will continue to focus on executing
trade receivables turnover, and Just in Time operations.
balanced management initiatives while boosting competitiveness.
Furthermore, in fiscal 2016, a new internal performance
At the same time, it will endeavor to expand sales, increase
indicator that comprehensively measures operating efficiency was
profitability, and pursue “high-quality” growth by constantly
introduced to widen the scope of improvement activities. This will
reviewing and refreshing its business portfolio and enhancing
enable the Group as a whole to secure further improvements in
capital efficiency.
Boosting Competitiveness
N Increasing the Allocation of Resources to Businesses
Driving Future Growth
ROE by continuously improving this indicator for each business.
Looking ahead, the Mitsubishi Electric Group will continue to
focus on generating stable cash flows, actively investing in
growth fields, pursuing the balanced distribution of profits to
shareholders through the payment of dividends, and diligently
The Mitsubishi Electric Group is active across a wide range of
working to increase corporate value.
diverse businesses.
Aiming for “high-quality” growth, the Group has positioned
the power systems, transportation systems, building systems, fac-
Continuous Innovation
The Mitsubishi Electric Group will steadfastly carry out its
tory automation (FA) systems, automotive equipment, space sys-
management policies guided by a commitment to balanced man-
tems, power devices, and air conditioning (AC) systems
agement, while putting into practice its overarching corporate
businesses as the drivers of future growth. In addition to increas-
statement, Changes for the Better. Each and every employee will
ing the allocation of resources to each of these businesses, the
share the common goal of developing new frontiers through
Mitsubishi Electric Group will boost competitiveness in line with
continuous innovation, and the Mitsubishi Electric Group—by
each business’ attributes.
continuing to undergo transformation itself—will mature into a
corporation that is always producing something better.
MITSUBISHI ELECTRIC CORPORATION ANNUAL REPORT 2015 05
At a Glance
Energy and Electric Systems
Industrial Automation Systems
Information and Communication Systems
Net sales
Yen (billions)
1,400
1,200
1,000
800
600
400
200
0
1,027
1,027
1,058
1,180
1,228
11
12
13
14
15
(Years ended March 31)
Net sales
Yen (billions)
1,400
1,200
1,000
800
600
400
200
0
927
978
927
1,282
1,098
11
12
13
14
15
(Years ended March 31)
Net sales
Yen (billions)
1,400
1,200
1,000
800
600
400
200
0
487
516
522
548
559
11
12
13
14
15
(Years ended March 31)
Operating income
Operating income
Operating income
Yen (billions)
160
140
120
100
80
60
40
20
0
-20
83
84
85
76
72
11
12
13
14
15
(Years ended March 31)
Yen (billions)
160
140
120
100
80
60
40
20
0
-20
145
100
101
98
60
11
12
13
14
15
(Years ended March 31)
Yen (billions)
160
140
120
100
80
60
40
20
0
-20
13
11
21
12
1
13
18
5
14
15
(Years ended March 31)
MAIN PRODUCTS AND BUSINESS LINES
MAIN PRODUCTS AND BUSINESS LINES
MAIN PRODUCTS AND BUSINESS LINES
Turbine generators, hydraulic turbine generators,
nuclear power plant equipment, motors,
transformers, power electronics equipment,
circuit breakers, gas insulated switches,
switch control devices, surveillance-system
control and security systems, large display devices,
electrical equipment for locomotives and rolling
stock, elevators, escalators, building security
systems, building management systems,
particle therapy systems, and others
Programmable logic controllers, inverters,
servomotors, human-machine interface, motors,
hoists, magnetic switches, no-fuse circuit
breakers, short-circuit breakers, transformers for
electricity distribution, time and power meters,
uninterruptible power supply, industrial fans,
computerized numerical controllers, electrical
discharge machines, laser processing machines,
industrial robots, clutches, automotive electrical
equipment, car electronics and car mechatronics,
car multimedia, and others
Wireless and wired communications systems,
surveillance cameras, satellite communications
equipment, satellites, radar equipment,
antennas, missile systems, fire control systems,
broadcasting equipment, data transmission
devices, network security systems, information
systems equipment, systems integration,
and others
M Fiscal 2015 Overview
April
Particle Therapy System
May
June
• Reorganized particle therapy business opera-
tions for expansion into global markets.
• Announced that Singapore-based subsidiary,
Mitsubishi Electric Asia Pte Ltd, has estab-
lished a branch office in Yangon, Myanmar.
Yangon Branch Office, Mitsubishi Electric Asia Pte Ltd
• Launched a new division at Mitsubishi Electric Europe B.V. to
strengthen the market position of transportation systems business
in Europe.
• Successfully launched the ALOS-2: DAICHI-2
advanced land-observation satellite.
• Began operating a new production facility for
factory automation products at Nagoya Works.
• Reorganized particle therapy business
operations for expansion into global
markets.
• Launched the MELSEC iQ-R Controller
series.
ALOS-2
New production facility
at Nagoya Works
MELSEC iQ-R series
2014
July
• Completed the integration of former air conditioning distributor Klima Plus
into local subsidiary Mitsubishi Electric Turkey A.S, ., which now consists of
two business units, Factory Automation Systems and Air Conditioning.
• Began operation at new elevator manufacturing factory in China, owned by
Mitsubishi Electric Shanghai Electric Elevator Co., Ltd.
• Began using the same corporate logo both in Japan and overseas.
06 MITSUBISHI ELECTRIC CORPORATION ANNUAL REPORT 2015
September
• Awarded contract to deliver the Es’hail 2 communications satellite to operator Qatar Satellite
Company (Es’hailSat) in Doha.
• Awarded a project to modernize traction equipment in 46 Intercity Express 2 (ICE-2)
High-Speed trains by
Deutsche Bahn AG (DB).
Es’hail 2
Intercity Express 2 high-speed trains by DB
Electronic Devices
Home Appliances
Others
Net sales
Yen (billions)
1,400
1,200
1,000
800
600
400
200
0
175
200
164
194
238
11
12
13
14
15
(Years ended March 31)
Net sales
Yen (billions)
1,400
1,200
1,000
800
600
400
200
0
924
849
821
944
944
11
12
13
14
15
(Years ended March 31)
Net sales
Yen (billions)
1,400
1,200
1,000
800
600
400
200
0
609
611
590
676
740
11
12
13
14
15
(Years ended March 31)
Operating income (loss)
Operating income
Operating income
Yen (billions)
160
140
120
100
80
60
40
20
0
-20
5
11
3
12
-5
13
30
10
14
15
(Years ended March 31)
Yen (billions)
160
140
120
100
80
60
40
20
0
-20
42
22
19
52
54
11
12
13
14
15
(Years ended March 31)
Yen (billions)
160
140
120
100
80
60
40
20
0
-20
14
11
20
18
19
23
12
13
14
15
(Years ended March 31)
MAIN PRODUCTS AND BUSINESS LINES
MAIN PRODUCTS AND BUSINESS LINES
MAIN PRODUCTS AND BUSINESS LINES
Power modules, high-frequency devices,
optical devices, LCD devices, and others
LCD televisions, room air conditioners, package
air conditioners, air-to-water heat pump boilers,
refrigerators, electric fans, ventilators, photovoltaic
systems, hot water supply systems, LED lamps,
fluorescent lamps, indoor lighting, compressors,
chillers, dehumidifiers, air purifiers, showcases,
cleaners, jar rice cookers, microwave ovens,
IH cooking heaters, and others
Procurement, logistics, real estate, advertising,
finance, and other services
October
• Completed Elevators and Escalators QM center
located at the company’s Inazawa Works to
develop and test global models.
• Successfully launched the Himawari-8 satellite.
• Commenced automotive parts manufacturing
and sales operations in new Mexican subsid-
iary, Mitsubishi Electric Automotive de Mexico, S.A. de C.V.
Himawari-8
Mitsubishi Electric
Automotive de Mexico,
S.A. de C.V
• Established Mitsubishi Electric (Russia) LLC, a comprehensive sales company
of Mitsubishi Electric for Russia.
Mitsubishi Electric
(Russia) LLC
February
• Delivered 15 elevators and 36 escala-
tors to Shanghai New World Daimaru
Department Store.
• Completed the upgrade and the
Cable network expansion project
expansion of the South East Asia—Middle East—Western Europe 4
(SEA-ME-WE 4) Cable System.
Elevators and spiral escala-
tors in Shanghai New World
Daimaru Department Store,
China (image)
Spiral
Escalators
November
• Established a new FA product show-
room in the headquarters of Mitsubishi
Electric Automation Korea Co., Ltd.
• Unveiled a Diamond Vision display that
exceeds 4k ultra-high-definition pixel
density at 1535 Broadway in New York
City‘s iconic
Times Square.
New FA product showroom
in Korea
Diamond Vision screen
at Marriott Marquis Hotel
2015
December
• Received an order for railcar traction inverter with all-silicon carbide (SiC)
power modules incorporating SiC transistors and SiC diodes, placed by
Odakyu Electric Railway Co., Ltd.
• Launched a new line of computerized numer-
ical controllers (CNCs), the M800W series.
• Announced the successful completion of
verification tests on VP-X turbine generator
for thermal power plants. Commercial launch
planned for April 2015.
Odakyu 1000 series train
M800W series
VP-X high-efficiency 870 MVA generator
MITSUBISHI ELECTRIC CORPORATION ANNUAL REPORT 2015 07
Review of Operations
Energy and Electric Systems
Net Sales Breakdown by Business Segment
24.6%
Net Sales
¥1,228.9billion
up 4% year on year
Operating Income
¥72.4billion
down ¥3.8 billion year on year
The social infrastructure systems business
saw a decrease in orders compared to the
previous fiscal year due primarily to a
decrease in the power generation and public
utility systems businesses in Japan. Sales,
meanwhile, remained unchanged compared
to the previous fiscal year owing to increases
in the rolling-stock equipment business
outside Japan.
The building systems business experienced
increases in both orders and sales compared
to the previous fiscal year, owing to growth
in new installation of elevators and escala-
tors overseas, mainly in China and ASEAN
countries, as well as the weaker yen.
As a result, total sales for this segment
increased by 4% from the previous fiscal
year to 1,228.9 billion yen. Operating
income decreased by 3.8 billion yen from
the previous fiscal year to 72.4 billion yen
due primarily to a shift in project portfolio.
08 MITSUBISHI ELECTRIC CORPORATION ANNUAL REPORT 2015
Next-generation SiC Inverter for Railcars
Mitsubishi Electric has developed a traction inverter for railcars
that incorporates silicon carbide (SiC), a new type of semicon-
ductor. This new inverter, with its energy-efficient, compact,
lightweight, low-maintenance, and low-noise design,
is expected to play a major role in next-generation railcar
propulsion systems.
Digital Signage System at Narita International Airport
Mitsubishi Electric has successfully installed Japan’s largest
digital signage system1 at Narita International Airport. This
system comprises 100 display units made up of a total of 336
display panels, including a unit consisting of 27 46-inch LCD
multi-display screens. As a part of efforts to ensure the presen-
tation of information in an appropriate and timely manner, a
wide range of content, including airport news and entertain-
ment, is delivered according to the location of each display.
1 Based on Mitsubishi Electric research as of June 2012
Particle Therapy System
Utilizing the characteristic features of protons, carbon, and
other heavy ions, particle therapy is a cutting edge technology
that allows for the pinpoint targeting of cancerous tumors
while minimizing side effects on surrounding normal tissues.
It is increasingly selected as an advanced solution in the treat-
ment of cancer.
Power Plants
Mitsubishi Electric power plant installations are used both
by power utility companies and by companies in various
industries as in-house power generators. Owing to its
accumulated expertise and leading technological capabilities,
Mitsubishi Electric is able to provide optimal power plants
in various power generation fields.
AXIEZ Machine-room-less Elevators
Along with enhanced energy-saving functions, including lighting
that is entirely LED, AXIEZ machine-room-less elevators offer
outstanding function and design. Furthermore, Mitsubishi
Electric has added a new large-capacity model to the AXIEZ
lineup, thereby extending the range of target buildings to
include large-scale office buildings, commercial facilities, and
hospitals.
Facima BA-System, an Open Integrated
Management System for Building Facilities
The Facima BA-system provides a variety of functions which help
save energy and make building management more efficient. In
order to target buildings of a wider range of sizes and purposes,
Mitsubishi Electric has launched a new wall-mounted model
with an LCD touch panel as part of its Facima lineup.
Industrial Automation Systems
Net Sales Breakdown by Business Segment
25.7%
Net Sales
¥1,282.7billion
up 17% year on year
Operating Income
¥145.9billion
up ¥47.9 billion year on year
The factory automation systems business
saw increases in both orders and sales from
the previous fiscal year due to growth in
capital expenditures relating to smartphone
and automotive industries as well as facility
replacements by manufacturers in Japan,
and due additionally to the weaker yen.
The automotive equipment business saw
increases in both orders and sales from the
previous fiscal year due primarily to growth
in the car sales market in North America
and China, as well as the positive influence
of the weaker yen.
As a result, total sales for this segment
increased by 17% from the previous fiscal
year to 1,282.7 billion yen. Operating
income increased by 47.9 billion yen from
the previous fiscal year to 145.9 billion yen
due primarily to an increase in sales.
Programmable Logic Controllers
Mitsubishi Electric’s MELSEC series of programmable logic
controllers supports a wide array of production and social
infrastructure applications; solutions range from control and
safety devices to information and instrumentation management.
As a leading global brand, the MELSEC series contributes to
the construction of cutting-edge control systems owing to its
capabilities, performance, product variety, and high reliability.
Industrial Robots
Featuring cutting-edge technologies, Mitsubishi Electric's
robotic systems are key components in Factory Automation
(FA). They are ideal for cell-based production coupled with
intelligent sensors, thanks to their high-speed, high-precision
core performance characteristics. By providing complete FA
solutions that combine programmable logic controllers and
AC servomotors, Mitsubishi Electric can create automated
systems that encompass the assembly, inspection, and
conveyance processes.
Low-voltage Circuit Breakers
Low-voltage Circuit Breakers are used for wiring protection
and short-circuit protection in low-voltage circuits. Since 1933,
Mitsubishi Electric has been continuously designing and
developing such breakers, the latest of which is the new WS-V
“World” series. The lineup is ideal for both power distribution
and OEM markets.
Electrical Discharge Machines (EDMs)
Beginning with the newly launched MP series, a strategic
product on a global scale, Mitsubishi Electric provides a lineup
of EDMs that add value and improve the manufacturing pro-
ductivity of molds and precision components. Such equipment
is indispensable to the production of automobiles, home
electronics, and IT-related devices.
Electric Power Steering (Motors and Controllers)
Mitsubishi Electric was the first company in the world to mass
produce motors and controllers for electric power steering to
assist driver steering in line with driving conditions. Over the
years, Mitsubishi Electric has helped to improve steering feel,
response, and stability while delivering compact units and
high-output performance, and contributing to reduced
automobile CO2 emissions.
Memory Car Navigation System
Mitsubishi Electric’s DIATONE SOUND.NAVI is a car navigation
system that incorporates acoustic technology cultivated during
the development of DIATONE products to offer improved
sound quality. The impressive audio reproduction properties of
the NR-MZ90 series bring more excitement to driving.
MITSUBISHI ELECTRIC CORPORATION ANNUAL REPORT 2015 09
Information and
Communication Systems
Net Sales Breakdown by Business Segment
11.2%
Net Sales
¥559.5billion
up 2% year on year
Operating Income
¥18.9billion
up ¥13.4 billion year on year
The telecommunications equipment busi-
ness saw decreases in both orders and sales
from the previous fiscal year due primarily
to a decrease in demand for communica-
tions infrastructure products.
Sales in the information systems and
services business saw decreases compared to
sales of the previous fiscal year mainly due to
decreases in the system integration business.
The electronic systems business saw a
decrease in orders compared to the previous
fiscal year due to decreases in large-scale
projects in the defense system and space
system businesses. Sales, meanwhile, expe-
rienced an increase compared to the previ-
ous fiscal year due to progress in orders
already received for projects in the defense
systems business.
As a result, total sales for this segment
increased by 2% compared to the previous
fiscal year to 559.5 billion yen. Operating
income increased by 13.4 billion yen from
the previous fiscal year to 18.9 billion yen
due primarily to an increase in sales.
10 MITSUBISHI ELECTRIC CORPORATION ANNUAL REPORT 2015
Information System Integrated Control Center
Specialist engineers are available 24/7 to remotely operate
and monitor client information systems and to analyze and
determine any problem that might occur using automated
tools, enabling a rapid response to any system malfunction.
(Mitsubishi Electric Information Network Corporation)
Mission-critical Server
Employing virtualization technology in its complete fault-tolerant
system as an overarching concept, this server not only ensures
the succession of customers’ application assets, but also
integrates internal mission-critical tasks and systems for
situations where failure is not an option.
(Mitsubishi Electric Information Network Corporation)
DS2000 Standard Satellite Platform
The DS2000 is a standard satellite platform modeled after
JAXA’s ETS-VIII platform, which was designed to meet the
need for high-quality, low-cost satellites with shortened
delivery times. The DS2000 has maintained a competitive edge
internationally, having been selected for use in satellites
Himawari-7, 8, and 9, and commercial satellites for Turkey and
Qatar, and is employed in eight satellites currently circling the
earth.
Vehicle-mounted Stations for Satellite
Communications
Vehicle-mounted satellite communication equipment enables
transmission of video and audio for broadcast news (satellite
news gathering) and information for disaster management.
Mitsubishi Electric products have achieved Japan’s highest
market share in this field, and are employed by Japanese
broadcasters, the public sector, and infrastructure companies
such as gas and electricity utilities.
Broadband Optical Access Systems
Mitsubishi Electric is progressively installing Gigabit Ethernet
Passive Optical Network (GE-PON) systems, which play a
central role in broadband services. The need for GE-PON
systems is steadily expanding due to high-capacity broadband
content, including the increased use of visual services.
Digital CCTV (Closed-circuit Television) System
This digital CCTV system meets the expanding range of needs
for video surveillance systems, which is achieved through new
digital technology incorporated into its high-resolution
megapixel camera and its high level of scalability, which can
accommodate even large-scale systems.
Electronic Devices
Net Sales Breakdown by Business Segment
4.8%
Net Sales
¥238.4billion
up 22% year on year
Operating Income
¥30.1billion
up ¥20.1 billion year on year,
The electronic devices business saw increases
in both orders and sales from the previous
fiscal year due to an increase in demand
mainly for power modules used in automo-
tive applications owing to expansion in
hybrid and electric vehicle markets, as well
as an increase in demand for power mod-
ules used in railcar, consumer, and industrial
applications and for optical communication
devices mainly in the Chinese market, and
due additionally to the weaker yen.
As a result, total sales for this segment
increased by 22% compared to the previous
fiscal year to 238.4 billion yen. Operating
income increased by 20.1 billion yen com-
pared to the previous fiscal year to 30.1
billion yen due primarily to an increase
in sales.
Hybrid SiC Large DIPIPMTM
for Photovoltaic Applications
This hybrid SiC large DIPIPM1 is designed with built-in SiC2-
SBDs3 and seventh-generation IGBT4 chips, enabling power
loss to be reduced by 25%, thereby contributing to a reduction
of power consumption in PV inverter systems.
1 Dual In-line Package Intelligent Power Module
2 Silicon Carbide
3 Schottky Barrier Diodes
4 Insulated Gate Bipolar Transistor
J1 Series Power Semiconductor Modules
for Automobiles
Mitsubishi Electric has expanded its lineup of J1 Series power
semiconductor modules mainly for motor drive applications in
electric and hybrid vehicles. The new modules contribute to
more compact, highly reliable automotive inverters thanks to a
direct cooling package with cooling fins.
3.5GHz-band GaN-HEMT for 4G Mobile
Communication Base Transceiver Stations
Mitsubishi Electric GaN1-HEMTs2 boast an industry-leading3 level output power
of 100W and superior efficiency through the use of GaN and an optimized
transistor structure. Small in design, these devices help to make base transceiver
stations more compact and energy efficient, enabling telecommunications
providers to increase the number of small-cell base stations and thus expand
the coverage area of macro-cell base stations for 3.5GHz-band 4th-generation
mobile communications systems.
1 Gallium Nitride
2 High Electron Mobility Transistor
3 Based on survey conducted by Mitsubishi Electric Corporation on March 11, 2015
DFB Laser Diode Developed for 25Gbps
Optical-fiber Communication in 100Gbps Systems
Mitsubishi Electric has developed a DFB1 laser diode that is capable of
operating in a wide range of temperatures for 25Gbps optical-fiber com-
munication applications. As a light source for communication applica-
tions, the device can be used in 100Gbps optical-fiber communication
systems. Using four DFB laser diodes for 25Gbps optical-fiber communi-
cation systems operating in tandem, it is possible to create high-speed
100Gbps optical-fiber communication systems with simpler designs, and
that consume less power while offering improved performance.
1 Distributed Feed-Back
Tough Series 7.0-inch WVGA Color TFT-LCD
Modules for Industrial Applications
Tough Series 7.0-inch WVGA color TFT-LCD modules are highly
resistant to vibration (6.8G acceleration resistance) and can
operate over a wide temperature range (–40°C to +85°C).
These in harsh environments, or characteristics make them ideal
for use as displays in construction and agricultural equipment.
12.1-inch WXGA and 15.0-inch SXGA+ Color
TFT-LCD Modules for Industrial Applications
Mitsubishi Electric TFT-LCD modules are designed for a broad
range of applications including as displays for medical and
machining equipment. Unique features include ultra-wide view-
ing angles (170° horizontally and vertically), high resolution,
high brightness, high contrast ratio, and an industry-leading
operating temperature range (-30°C - +80°C).
MITSUBISHI ELECTRIC CORPORATION ANNUAL REPORT 2015 11
Current blocking structureCurrentActive regionElectrodeInP substrateOptical outputPassive waveguideDFB laser diode Home Appliances
Net Sales Breakdown by Business Segment
18.9%
Net Sales
¥944.8billion
unchanged year on year
Operating Income
¥54.2billion
up ¥1.4 billion year on year
The home appliances business remained
substantially unchanged compared to the
previous fiscal year with total sales for this
segment amounting to 944.8 billion yen,
despite increased sales in air conditioners in
Asian, North American, and European
markets and in package air conditioners in
Japan, as well as the weaker yen, due to
impact from the last-minute surge in
demand experienced in Japan before the
rise in consumption tax the previous year.
Operating income increased by 1.4 billion
yen compared to the previous fiscal year
to 54.2 billion yen largely due to the
weaker yen.
Room Air Conditioners
In addition to KIRIGAMINE room air conditioners, Mitsubishi
Electric offers an extensive lineup of products with applications
extending from stores, offices, and buildings to factories and
industrial facilities while featuring environmentally compatible,
energy-saving technologies. These qualities allow Mitsubishi
Electric to meet air conditioning needs globally.
Housing Equipment
ENEDIA is a system that effectively uses renewable energy
through the ingenious application of a home energy manage-
ment system (HEMS) that stores electricity generated by solar
panels in the batteries of an electric vehicle. ENEDIA is based
on our concept of a smart electric home that conserves energy
by using highly efficient air conditioners, water heaters, and
cooking equipment. It gives residents a way to conserve ener-
gy without sacrificing comfort.
Home Appliances
The home appliances business strives to deliver technologies
and products that bring convenience, comfort, and enjoyment
to everyday life. Focusing on keywords such as “delicious,”
“delightful,” and “soothing,” every effort is made to further
enhance people’s quality of life through intelligent, connected,
and economical—or, in short, ”smart”—technologies.
LED Lighting
Mitsubishi Electric offers an extensive lineup of high-efficiency,
long-lasting LED products that meet diverse needs for energy-
saving light bulbs and equipment in households, stores, offic-
es, and factories. Our LED products make the future brighter
for families and society as a whole.
Visual Equipment for Public
and Business Applications
Mitsubishi Electric's high-quality image processing technolo-
gies deliver exceptionally sharp images with superior color
reproduction and are incorporated in a wide range of products
developed to suit a variety of application needs. These systems
are being used in Japan and abroad for large-screen applica-
tions, such as digital signage used to display images, data, and
information at public facilities and other venues.
Customers
Consumer electronics
and home appliances
Used products
Mitsubishi Electric Corporation
Hyper Cycle Systems Corporation
Materials
manufacturers
Metals and glass
Original
recycling system
Simple
plastics
Plastic
PP, PS, ABS
Mixed plastics
Green Cycle Systems Corporation
Recycling Consumer Electronics
and Home Appliances
Mitsubishi Electric has developed technologies for automati-
cally sorting the three major types of plastic (polypropylene
(PP), polystyrene (PS), and acrylonitrile-butadiene-styrene
(ABS)) used in consumer electronics and home appliances. This
original recycling system is being utilized to promote the reuse
of plastics in the Company's products by improving the physi-
cal properties of the sorted materials.
12 MITSUBISHI ELECTRIC CORPORATION ANNUAL REPORT 2015
Research and Development / Intellectual Property
Research and Development
N R&D Initiatives
The Mitsubishi Electric Group’s R&D network consists of the
building systems, FA systems, automotive equipment, space sys-
Advanced Technology R&D Center, Information Technology R&D
tems, power devices, air conditioning systems, and other systems.
Center, and Industrial Design Center in Japan as well as laborato-
To reinforce the solutions business centered on strong busi-
ries in the United States, Europe, and China. These centers
nesses, the Group is pursuing R&D that will expand the solutions
operate under the umbrella of the Corporate Research and
business, which encompasses products and services in the smart
Development Group working in collaboration with the develop-
community, rail, factory, building, housing, security, and
ment departments of individual Mitsubishi Electric business
other fields.
groups. Through the diligent pursuit of R&D, the Group is pro-
Global strategies are simultaneously being reinforced, with
moting the achievement of an even higher level of growth by
energies channeled toward development that takes advantage of
making strong businesses stronger, continuously creating new
increasingly robust ties with local bases, research laboratories,
strong businesses, and reinforcing the solutions business centered
and universities in North America, Europe, China, and Asia.
on strong businesses.
R&D is the vehicle that drives growth strategies forward.
To make strong businesses stronger and continuously create
Moving forward, the Mitsubishi Electric Group will aim for devel-
new strong businesses, the Mitsubishi Electric Group is promoting
opments that can be leveraged in tomorrow's products while
R&D that will bolster power systems, transportation systems,
pursuing R&D themes that will yield results in ten, or even
N R&D Achievements in Fiscal 2015
Q Development of New Irradiation Technology for Proton-type Particle Therapy System
twenty, years from now.
Particle beam
irradiation apparatus
Mitsubishi Electric Corporation has developed a new irradia-
tion technology for particle therapy systems used in cancer
treatment that can treat various types of tumors by switching
between three different particle beams.
The shapes and locations of tumors differ from patient to
patient, and this has made it difficult to use a single therapy
system for treatments. However, the new technology allows
for irradiation of a wide range of tumors with a high degree
of precision using a single therapy system.
Mitsubishi Electric Corporation will continue to work on
developing more advanced particle therapy systems, and
offering systems that are reliable to use.
Treating various types of tumors utilizing new irradiation technology
Q Development of Support Technologies for Tsunami Radar Monitoring
Mitsubishi Electric Corporation has developed the world’s
first* tsunami monitoring support technologies that can
detect the development of tsunamis from sea-surface data
produced with radar observations, and estimate the height of
the wave.
Over the horizon
Line-of-sight
distance
Traditional observation methods could only observe tsunami
waves on ocean surfaces up to 20 km offshore, due to the
Epicenter
Observation distance:
Maximum 20 km
curvature of the Earth. However, the new technologies can
observe tsunami waves on ocean surfaces up to 50 km
offshore under certain conditions, by using oceanographic
radar technology.
Being able to quickly detect tsunamis arising at a greater
distance will help mitigate and prevent damage to
coastal regions.
*As of February 17, 2015 (survey conducted by Mitsubishi Electric Corporation)
Conventional technology
Epicenter
Observation distance:
Maximum 50 km
Proprietary technology
Helping to mitigate and prevent damage to coastal regions
MITSUBISHI ELECTRIC CORPORATION ANNUAL REPORT 2015 13
Q Development of Water Treatment Technology Using Gas/Liquid Interfacial* Discharge
Mitsubishi Electric Corporation has developed a novel water
treatment technology for treating and reusing industrial
wastewater and sewage that can decompose substances
which were difficult with conventional technologies.
The treatment system places electrodes on slanted surfaces,
over which the water to be treated flows. Discharges from the
electrodes then generate hydroxyl radicals with strong capaci-
ty to decompose substances. These hydroxyl radicals are used
for the highly efficient breakdown of substances which were
difficult using chlorination or ozonation.
This enables building a system for reusing industrial waste-
Electrical discharge machine
Electrode
Discharge
Water to be
treated
Reactor
Water treatment equipment that
utilizes gas/liquid interfacial discharge
Reuse
Wastewater
g
n
i
s
s
e
c
o
r
p
e
r
P
Factory
water and sewage at a lower cost, contributing to the cre-
Conceptual diagram of a system that reuses industrial wastewater
ation of a sustainable water recycling society.
*Gas/liquid interface: the contact surface between a gas and a liquid
Contributing to the creation of a water recycling society through
the low-cost reuse of industrial wastewater and sewage
Intellectual Property
L Basic Policy
The Mitsubishi Electric Group recognizes that intellectual property
L Global IP Strategy
The Mitsubishi Electric Group identifies critical IP-related themes
(IP) rights represent a vital management resource essential to its
in connection with mainstay businesses and important R&D proj-
future. Therefore, every effort is made to integrate the Group’s
ects. At the same time, the Group channels its energies toward
business, R&D, and IP activities. Moving forward, the Mitsubishi
the globalization of its robust patent portfolio by promoting
Electric Group will further strengthen its IP capabilities while
patent filing activities. With regard to its overseas operations, the
promoting its growth strategy.
L Structure of the Intellectual Property Division
The Mitsubishi Electric Group’s IP-related operations are the direct
Group is accelerating the globalization of its IP activities through
actions such as working to increase the number of patent appli-
cations it files prior to undertaking business development in
emerging countries, including India and Brazil.
responsibility of the president and are overseen by the Head Office
Moreover, the Mitsubishi Electric Group is actively engaging in
IP Division under an appointed IP executive officer. Day-to-day
activities aimed at acquiring design rights in Japan and overseas
issues are handled by IP departments at relevant facilities, R&D
to further enhance its robust patent portfolio. These efforts are
centers, and affiliated companies. The Head Office IP Division
intended to specifically protect proprietary assets in both technol-
formulates strategies for the entire Group, promotes critical
ogy and design areas.
IP-related projects, and coordinates interaction with the patent
office. At the manufacturing facility, R&D center, and affiliated
company levels, IP departments pursue specific objectives in line
with the Group’s overall IP strategies.
Annual Trends in Overseas Patent Applications by
the Mitsubishi Electric Group
Integrating Business, R&D, and IP Activities
(No. of Applications)
10,000
Integration
IP Network
IP/Standardization
Strategy
IP Division at
Headquarters
President
Business Strategy
IP Departments at
Business Groups,
Facilities, Affiliates
Development
Strategy
R&D Centers
IP Departments
7,500
5,000
2,500
0
14 MITSUBISHI ELECTRIC CORPORATION ANNUAL REPORT 2015
2012
2013
2014
2015
(FY)
USA Europe China Other
Further Strengthening Global IP Capabilities
IP representative
Europe
Asia
USA / Brazil
Head Office
IP Division
P Protecting products through IP rights
P Acquiring international standard-related patents
P Counterfeit product countermeasures
The Mitsubishi Electric Group has assigned IP representatives to
L Activities Aimed at Preventing Infringement
each of its bases in the United States, Europe, and China. Every
on the Group’s IP Rights
effort is being made to strengthen IP capabilities at Group facili-
The Mitsubishi Electric Group works diligently to prevent any
ties, R&D centers, and affiliated companies in each country.
infringement on its IP rights by other companies. In addition to
L Standardization Strategy
As companies continue to globalize their business activities, the
in-house activities, the Group places particular weight on collabo-
rating with industry organizations while approaching government
agencies both in Japan and overseas as a part of a wide range of
international standardization of technologies that contribute to
measures to prevent the counterfeiting of its products.
global market growth is significantly impacting business strategies.
For this reason, the importance of promoting IP strategies in
consideration of international standards is increasing. In response
L Respecting the IP Rights of Others
The Mitsubishi Electric Group recognizes that any infringement on
to this situation, the Mitsubishi Electric Group is placing emphasis
the IP rights of another company has the potential to significantly
on activities to standardize its development technologies and
impair the Group’s continued viability as a going concern. The
acquire related IP rights. The Group is paying particular attention
resulting potential impairments include being obliged to pay
to the acquisition of international standard patents, while patent
significant licensing fees or being forced to discontinue the man-
pools, including those for MPEG and Blu-ray DiscTM*, are proving
ufacture of a certain product. In order to prevent any infringement
to be a wellspring for IP revenues. These revenues are contribut-
on the IP rights of other companies, the Group provides education
ing to improvement and growth in business earnings.
and training to raise employee awareness and promote greater
Furthermore, the Mitsubishi Electric Group is working to reinforce
respect for the IP rights of others. At the same time, the Group
its activities to acquire rights for international standard-related
has put in place a set of rules to facilitate appropriate actions
technologies. The Group is looking to utilize these patents to
such as surveying other companies’ patent rights at every stage
help increase the market share of its products.
from development to production. The Mitsubishi Electric Group
*Blu-ray DiscTM is a trademark of the Blu-ray Disc Association
works diligently to ensure strict adherence to these rules.
MITSUBISHI ELECTRIC CORPORATION ANNUAL REPORT 2015 15
Corporate Social Responsibility
The Mitsubishi Electric Group promotes its corporate social
responsibility (CSR) activities based on the conviction that all
business activities must take CSR into consideration. The Group’s
Corporate Mission and Seven Guiding Principles form its basic
CSR policies. It is vigilant in its enforcement of corporate ethics
and compliance and constantly works to improve educational
programs and strengthen its internal control system. At the
same time, it pursues initiatives related to quality management,
global environmental conservation, philanthropy, and improved
communication with all stakeholders.
Corporate Mission
The Mitsubishi Electric Group will continually improve its technol-
ogies and services by applying creativity to all aspects of its busi-
ness. By doing so, we enhance the quality of life in our society.
To this end, all members of the Group will pursue the following
Seven Guiding Principles.
Seven Guiding Principles
Trust, Quality, Technology, Citizenship, Ethics and Compliance,
Environment, Growth
N The Mitsubishi Electric Group’s
Corporate Social Responsibility
The operating environment continues to undergo dramatic
changes, reflecting advances in globalization, revisions to legisla-
tion, and other factors. What must continue regardless of how
the times may change is a respect for corporate ethics and com-
pliance and a commitment to never compromise on environmen-
tal issues and product quality.
This commitment of the Mitsubishi Electric Group was first
articulated in the Keys to Management (in Japanese, Keiei no
Yotei), which was drawn up at the time of Mitsubishi Electric’s
founding in 1921.
The spirit of this document, which states the Group‘s contribu-
tions in areas such as the prosperity of society, product quality,
and customer satisfaction, lives on today in its Corporate Mission
and Seven Guiding Principles. With these tenets as its core princi-
ples, the Group promotes various initiatives in order to fulfill its
corporate social responsibilities.
In particular, the Group‘s commitment to corporate ethics and
compliance has underpinned corporate management while form-
ing the core of the Group‘s efforts to strengthen its internal control
system and implement employee training programs. Looking ahead,
the Group will continue to strictly adhere to a policy of compliance.
It will also redouble its efforts to bolster activities and to establish
relationships built on robust mutual trust with all stakeholders.
As a member on society, the Mitsubishi Electric Group is respon-
sible for upholding corporate ethics and compliance as well as
contributing to society. The Group recognizes its responsibility to
contribute to society through the technologies it has built up over
the years.
A sincere concern for the environment permeates every facet
of the Mitsubishi Electric Group’s operations. Thus, it can be said
that each facet of the Group‘s business activities is geared toward
contributing to the environment. The technologies and products
that make up its portfolio support environmental protection,
energy conservation, and social infrastructure while being gentle
to humankind and the earth, thereby enriching society.
Looking ahead, the Group will help create a more prosperous
and sustainable society by harnessing the strengths of its
wide-ranging technological capabilities.
N Philanthropic Activities
Philosophy and Policies on Philanthropic Activities
The Mitsubishi Electric Group shares a common Philosophy and
16 MITSUBISHI ELECTRIC CORPORATION ANNUAL REPORT 2015
Policies based on its Corporate Mission and Seven Guiding
Principles, and carries out a variety of activities accordingly.
Philosophy
As a corporate citizen committed to meeting societal needs and
expectations, the Mitsubishi Electric Group will make full use of
the resources it has at hand to contribute to creating an affluent
society in partnership with its employees.
Policies
• We shall carry out community-based activities in response to
societal needs in the fields of social welfare and global environ-
mental conservation.
• We shall contribute to developing the next generation through
activities that support the promotion of science and technology,
culture and arts, and sports.
Promoting Activities Deeply Rooted in Local Communities
and Activities that Develop the Next Generation
The Mitsubishi Electric’s philanthropic activities are underpinned
primarily by the Mitsubishi Electric SOCIO-ROOTS Fund, a gift
program in which the Company matches any donation made by
an employee to social welfare facilities; the “Satoyama”
Woodland Preservation Project, which involves employee volun-
teers participating in environmental restoration activities in the
areas surrounding its offices and production facilities; and science
workshops that foster the development of the engineers of
tomorrow by encouraging children to experience for themselves
the appeal of science.
Focusing on philanthropic activities of affiliate companies in
and outside of Japan, the Group implements a broad range of
initiatives, including undertaking activities with the help of
Supporting Children Affected by the Great East
Japan Earthquake (Mitsubishi Electric Corporation)
“Mouth and Foot Painting Artists of the World Exhibition”
(Mitsubishi Electric Building Techno-Service Co., Ltd.)
Supporting the Special Olympics
(Mitsubishi Electric Europe B.V. Italian
Branch, Mitsubishi Electric Europe, B.V.
German Branch)
employee volunteers, funding social welfare organizations, and
offering support for young musicians and sports teams.
activity item identified in the Group’s 7th Environmental Plan,
covering fiscal 2013 through fiscal 2015, it has embarked on the
8th Environmental Plan, covering fiscal 2016 through fiscal 2018.
Foundations
The Mitsubishi Electric America Foundation and Mitsubishi Electric
Thai Foundation, both founded in 1991, also carry out various
activities in the spirit of the Mitsubishi Electric Group‘s Philosophy
and Policies. The Mitsubishi Electric America Foundation, with the
cooperation of its branches in the United States, helps young
people with disabilities to become employed and participate
more fully in society. The Mitsubishi Electric Thai Foundation, in
addition to providing scholarships to university students and sup-
porting a school lunch program for grade school students, has in
recent years been promoting employee-involved volunteer activi-
ties that support education and environmental protection.
An employee volunteer working with a student
on Disability Mentoring Day (United States)
Local Mitsubishi Electric Companies in joint
mangrove tree planting activity (Thailand)
N Environmental Activities
Transitioning from the 7th Environmental Plan to
the 8th Environmental Plan
The Mitsubishi Electric Group has set the goal of becoming a
global, leading green company that helps to realize a sustainable
society in which people around the world live contentedly and in
comfort, and where diverse forms of life coexist. In 2007, the
Group put in place the Environmental Vision 2021, a long-term
vision for environmental management. Under this vision, the
Group will fulfill its responsibilities to society from an environ-
mental perspective by developing and promoting the widespread
use of products and services that boast outstanding resource and
energy efficiency across all business fields, and advancing efforts
to reduce the environmental impact of all of its business activities
from procurement through production to logistics.
In order to incorporate a PDCA cycle into its environmental
activities in a systematic and definitive manner, the Group has
identified specific activity targets as a part of its latest
medium-term environmental plan, which has been renewed every
three years since 1993. Having successfully completed each
P Activity Items of the 8th Environmental Plan
1. Initiatives aimed at realizing a low-carbon society
Increase the level of contribution to society by reducing CO2.
Specifically, (1) reduce CO2 from production, and (2) reduce
CO2 from product usage.
2. Initiatives aimed at forming a low-carbon society
(1) Promote the effective use of resources utilizing the final
disposal ratio as a key indicator, (2) reduce resource inputs, and
(3) strengthen partnerships with resource recycling businesses.
3. Initiatives aimed at realizing a symbiotic society
(1) Hold various events, including the Mitsubishi Electric
Outdoor Classroom and the Satoyama Woodland Preservation
Project, and (2) foster environmental awareness by promoting
online environmental education on a global scale.
4. Efforts toward strengthening the environmental management platform
(1) Improve the execution of quantitative assessment of
environmental risk and management at factories in Japan and
overseas, and (2) adhere strictly to environmental rules
and regulations.
• Major Activity Item 1:
Reducing CO2 Emissions from Production
Under its 8th Environmental Plan, the Mitsubishi Electric Group
will integrate and promote the reduction of CO2 from energy
sources and the management of efforts aimed at reducing
greenhouse gases other than CO2*, activities that were previously
undertaken on an individual basis, in order to comprehensively
evaluate and manage the impact of greenhouse gases on the
goal of realizing a low-carbon society. The plan, ending in fiscal
2018, calls for the total of CO2 from energy sources and
greenhouse gases other than CO2 to be kept below 1,370,000
tons on an annual CO2 equivalent emission basis, considerably
lower than the base year figure of 2,640,000 tons**.
* Emissions of such substances as SF6, PFC, and HFC that are subject to reduction
under the Kyoto Protocol
** CO2 from energy sources:
Mitsubishi Electric (non-consolidated) 1990; affiliates in Japan 2000;
overseas affiliates 2005
Greenhouse gases other than CO2:
Mitsubishi Electric (non-consolidated) and affiliates in Japan 2000;
overseas affiliates 2005
Reduce CO2 emissions
from product usage by 30%
(Base year: fiscal 2001)
Reduce total emissions
from production by 30%
(Base year: fiscal 1991)
Aim to reduce CO2 emissions
from power generation
Environmental Vision 2021
Global Leading
Green Company
Promote product “3Rs”;
reduce, reuse, and recycle
Reduce resource inputs
Aim for zero emissions
from manufacturing
Contribute to the
Environment and Society
(through our products, services,
and business activities)
Reduce
environmental impact
(by further honing highly efficient
manufacturing techniques to
minimize our environmental impact)
Creating a
Low-Carbon
Society
Creating a
Recycling-Based
Society
Respecting Biodiversity
Ensuring harmony with nature and
fostering environmental awareness
MITSUBISHI ELECTRIC CORPORATION ANNUAL REPORT 2015 17
Plan to Reduce CO2 from Production across the Mitsubishi Electric Group
24
264
146
Reduction
118
300
200
100
0
120
119
124
28
92
26
93
29
95
140
28
143
27
137
22
42% reduction
154
30
112
116
115
124
)
2
O
C
-
t
0
0
0
,
0
1
(
s
n
o
i
s
s
i
m
E
2
O
C
f
o
t
n
u
o
m
A
l
a
t
o
T
(Base fiscal year)**
2013
2014
2015
2016
2017
2018
2021 (FY)
7th Environmental Plan
8th Environmental Plan
Environmental Vision
2021 Target
Amount of CO2 emissions
Amount of greenhouse gas emissions other than CO2
Total greenhouse gases
Note: CO2 emissions are calculated using an emission coefficient of 0.422t-CO2/MWh up to fiscal 2015 and an emission coefficient of
0.487t-CO2/MWh from fiscal 2016.
In an effort to reduce CO2 from energy sources, the Mitsubishi
Electric Group is introducing high-efficiency air conditioners and
other equipment while shifting to LED lighting. The Group is also
striving to understand energy consumption at the point of produc-
tion. To eliminate waste, the Group is looking at improving heat
loss while reducing standby power. Working to reduce such green-
house gases as SF6, HFC, and PFC, the Group is shifting to the use
of refrigerant gases with low global warming potential. Other
ongoing initiatives include the building of a handling scheme that
extends from gas recovery through recycling to eventual destruc-
tion; efforts to reinforce countermeasures aimed at preventing
leaking; and the early introduction of treatment systems.
The amount of emissions came to 1,240,000 tons in fiscal
2015, an increase of 50,000 tons compared with the level
recorded in fiscal 2014. While the scale of production is projected
to rise during the period of the 8th Environmental Plan, the
Mitsubishi Electric Group expects to achieve the aforementioned
target by steadfastly implementing the previously identified
measures.
• Major Activity Item 2:
Reducing CO2 Emissions from Product Usage through Improved Energy
Efficiency Performance
Regarding greenhouse gas emissions outside the scope of the
Mitsubishi Electric Group’s business activities, a principal source is
the CO2 derived from electric power consumption during the
period that products are used. When the amount of CO2 emitted
during product use is calculated, the levels during product use can
be several dozen to several hundred times the amount emitted
during production. Therefore, the development and widespread
use of highly energy-efficient products can contribute significantly
to the reduction of CO2 emissions. Under the 8th Environmental
Plan, the Mitsubishi Electric Group is aiming for an average CO2
reduction ratio of 35% or more compared with fiscal 2001 for
specific products where the Group can take the initiative regard-
ing design and development and where the reduction of CO2
emissions during product use is deemed important from an
environmental aspect. The number of specified products in fiscal
2015 was 107 (90 end products and 17 intermediate products).
The average rate of CO2 emissions reduction among these
products was 33%. Based on this result, the Group is making
steady progress toward achieving its target. Looking ahead, the
Group will continue to promote improvements.
Plan for Reducing CO2 from Product Usage through
Improved Energy Efficiency
17%
26%
29%
33%
33%
35%
30%
or
more
0
10
20
30
)
%
(
n
o
i
t
c
u
d
e
r
f
o
e
t
a
r
e
g
a
r
e
v
A
100
2001
(Base fiscal year)
2008 2012 2013 2014 2015 2016 2017 2018
7th
Environmental
Plan
8th
Environmental
Plan
(FY)
2021
Environmental
Vision
2021 Target
More information about the Mitsubishi Electric Group’s environmental and CSR initiatives is available on the following websites:
http://www.MitsubishiElectric.com/company/csr/
http://www.MitsubishiElectric.co.jp/corporate/environment/
18 MITSUBISHI ELECTRIC CORPORATION ANNUAL REPORT 2015
Corporate Governance
N Basic Corporate Governance Policy
To realize sustained growth and increase corporate value,
duties. Internal auditors report on the results of such monitoring
to the executive officer in charge of auditing, and the executive
Mitsubishi Electric works to maintain the flexibility of its operations
officer in charge of auditing and accounting auditors report on
while promoting management transparency. These endeavors are
the results of such monitoring to the Audit Committee.
supported by an efficient corporate governance structure that
Mitsubishi Electric maintains a multi-dimensional risk manage-
clearly defines and reinforces the supervisory functions of manage-
ment system in which all executive officers participate. Under this
ment while ensuring that the Company is responsive to the expec-
system, executive officers are responsible for risk management in
tations of customers, shareholders, and all of its stakeholders.
their assigned areas of operation. In addition, executive officers
N Corporate Management and Governance Structure
Corporate Management Structure
In June 2003, Mitsubishi Electric became a company with a
exchange information and participate in important management
initiatives and decisions through regularly scheduled executive
officers’ meetings.
committee system. Key to this structure is the separation of
The Corporate Auditing Division and Audit Committee
supervisory and executive functions; the Board of Directors plays
Acting independently, Mitsubishi Electric’s Corporate Auditing
a supervisory decision-making role and executive officers handle
Division conducts internal audits of the Company from a fair and
the day-to-day running of the Company.
impartial standpoint. In addition, the division’s activities are
The present Board is comprised of twelve directors (five of
supported by auditors with profound knowledge of their particu-
whom are outside directors), who objectively supervise and advise
lar fields, assigned from certain business units.
the Company’s management. The Board of Directors has three
The Audit Committee is made up of five directors, three of
internal bodies: the Audit, Nomination and Compensation com-
whom are outside directors. In accordance with the policies and
mittees. Each body has five members, three of whom are outside
assignments agreed to by the committee, the performances of
directors. The Audit Committee is supported by dedicated
directors and executive officers as well as affiliated companies
independent staff.
Internal Control System
are audited.
The Corporate Auditing Division, through the executive officer
in charge of auditing, submits reports to the Audit Committee,
Further ensuring effective corporate governance, the roles of
which holds periodic meetings to exchange information and dis-
Chairman and President & CEO are clearly defined and exclusive.
cuss auditing policies. In addition, the Audit Committee discusses
The Chairman heads the board of directors and the President &
policies and methods of auditing with accounting auditors, who
CEO heads the Company’s executive officers. Neither the Chair-
furnish it with reports on the status and results of the audits of
man nor the President & CEO is a member of the Nomination or
the Company that they themselves conduct.
Compensation Committees. This allows for the clear division of
executive and supervisory functions, thereby enabling Mitsubishi
Electric to ensure effective corporate governance.
Executive officers are responsible for ensuring compliance and
management efficiency in their assigned areas of operations.
Internal auditors monitor executive officers’ performance of
Report
General Shareholders’ Meeting
Report
Appointment
Appointment/Dismissal/Supervision
Reporting to
Decision Making and Execution
Executive Officers
President & CEO
Executive Vice Presidents
Senior Vice Presidents
Executive Officers
Business/Administration Divisions
Supervision
Board of Directors
Chairman
Nomination Committee
Outside Directors (majority)
s
r
o
t
c
e
r
i
D
Audit Committee
Outside Directors (majority)
Compensation Committee
Outside Directors (majority)
MITSUBISHI ELECTRIC CORPORATION ANNUAL REPORT 2015 19
N Policies Regarding Decisions on Compensation, etc.
Policies regarding decisions on compensation, etc. will be made
The compensation scheme for the Executive Officers
1. The compensation scheme for the Executive Officers focuses
through resolutions by the Compensation Committee, the major-
on incentives for the realization of management policies and
ity of which consists of Outside Directors. A summary of the poli-
the improvement of business performance, and performance-
cies is as follows.
based compensation will be paid in addition to the payment of
fixed-amount compensation and the retirement benefit upon
The compensation scheme for Directors
resignation.
1. Directors give advice to and supervise the Company's manage-
2. Fixed-amount compensation will be set at a level considered
ment from an objective point of view, and therefore, the com-
reasonable taking into account the contents of the Executive
pensation scheme for Directors is the payment of fixed-amount
Officers duties and the Company's conditions.
compensation and the retirement benefit upon resignation.
3. The level of performance-based compensation will be decided
2. Directors will receive their compensation as a fixed amount,
while taking into account the consolidated business perfor-
and the compensation to be paid will be set at a level consid-
mance and the performance of the business to which the
ered reasonable, while taking into account the contents of the
respective Executive Officer is assigned, etc. With the purposes
Directors' duties and the Company's conditions, etc.
of meshing the interest of shareholders with the Executive
3. Directors will receive the retirement benefit upon their resigna-
Officers and further raising management awareness that places
tion, and the retirement benefit to be paid will be set at a level
importance on the interest of shareholders, and increasing the
decided on the basis of the monthly amount of compensation
incentives for the improvement of business performance from
and the number of service years, etc.
the mid- and long-term perspectives, 50% of performance-
based compensation will be paid in the form of shares. The
Company sets a rule that, when the Executive Officers acquire
the Company shares as a part of compensation, they are
required to continue the shareholding until 1 year has passed
from resignation.
4. The amount of the retirement benefit will be decided on the
basis of the monthly amount of compensation and the number
of service years, etc.
20 MITSUBISHI ELECTRIC CORPORATION ANNUAL REPORT 2015
Directors and Executive Officers
Directors (As of June 26, 2015)
Executive Officers (As of April 1, 2015)
Kenichiro Yamanishi ......... Chairman
Masaki Sakuyama .............. Representative Executive Officer, President &
President & CEO:
Masaki Sakuyama
CEO
Hiroki Yoshimatsu ............. Chairman of the Audit Committee
Noritomo Hashimoto ........ Member of the Nomination Committee,
Senior Vice President
Nobuyuki Okuma .............. Chairman of the Nomination Committee,
Chairman of the Compensation Committee,
Executive Officer
Akihiro Matsuyama ........... Member of the Compensation Committee,
Executive Officer
Takashi Sasakawa .............. Member of the Audit Committee
Mikio Sasaki ....................... Member of the Compensation Committee,
Senior Corporate Advisor, Mitsubishi
Corporation
Senior Vice Presidents:
Hideyuki Okubo ................ In charge of Export Control and Total
Productivity Management & Environmental
Programs
Yutaka Ohashi ................... In charge of Automotive Equipment
Noritomo Hashimoto ........ In charge of Corporate Strategic Planning and
Operations of Associated Companies
Yoshiaki Nakatani.............. In charge of Electronic Systems
Masayuki Ichige ................. In charge of Auditing, Government & External
Relations and Public Relations
Shigemitsu Miki ................. Member of the Nomination Committee,
Executive Officers:
Member of the Audit Committee,
Senior Advisor, The Bank of Tokyo-Mitsubishi
UFJ, Ltd.
Isao Iguchi .......................... In charge of Advertising and Domestic
Marketing
Nobuyuki Okuma .............. In charge of General Affairs and
Mitoji Yabunaka ................ Member of the Nomination Committee,
Human Resources
Member of the Compensation Committee,
Advisor, Nomura Research Institute, Ltd.
Hiroshi Obayashi ............... Member of the Nomination Committee,
Member of the Audit Committee,
Attorney-at-Law
Akihiro Matsuyama ........... In charge of Accounting and Finance
Takashi Sakamoto ............. In charge of Purchasing
Takahiro Kikuchi ................ In charge of Public Utility Systems
Kenji Kondo ....................... In charge of IT and Research & Development
Kazunori Watanabe .......... Member of the Audit Committee,
Nobuyuki Abe .................... In charge of Building Systems
Member of the Compensation Committee,
Certified Public Accountant,
Registered Tax Accountant
Katsuya Takamiya .............. In charge of Global Strategic Planning &
Marketing
Takaaki Kukita ................... In charge of Global Strategic Planning &
Marketing
Representative Executive Officers (As of April 1, 2015)
Takeshi Sugiyama .............. In charge of Living Environment &
Masaki Sakuyama
Hideyuki Okubo
Yutaka Ohashi
Digital Media Equipment
Nobushi Morooka ............. In charge of Legal Affairs & Compliance,
Export Control and Intellectual Property
Yasuyuki Ito ....................... In charge of Energy & Industrial Systems
Hideaki Nagatomo ............ In charge of Living Environment &
Digital Media Equipment
Toru Sanada ....................... In charge of Semiconductor & Device
Takashi Nishimura ............. In charge of Communication Systems
Shinya Fushimi ................... In charge of Information Systems &
Network Service
Kei Uruma .......................... In charge of Factory Automation Systems
MITSUBISHI ELECTRIC CORPORATION ANNUAL REPORT 2015 21
Organization (As of June 26, 2015)
Board of Directors
Chairman
Nomination
Committee
Audit
Committee
Compensation
Committee
Audit Committee Office
Executive Officers’
Meeting
President & CEO
Senior Vice
Presidents
Executive
Officers
(cid:31) Corporate Auditing Div.
(cid:31) Corporate Marketing Group
(cid:31) Corporate Strategic
Planning Div.
(cid:31) Corporate IT Strategy Div.
(cid:31) Associated
Companies Div.
(cid:31) Government &
External Relations Div.
(cid:31) Global Strategic Planning &
Marketing Group
(cid:31) Corporate Total Productivity
Management & Environmental
Programs Group
(cid:31) Corporate
Administration Div.
(cid:31) Corporate Research and
Development Group
(cid:31) Corporate Human
Resources Div.
(cid:31) Corporate
Accounting Div.
(cid:31) Corporate Finance Div.
(cid:31) Information Systems &
Network Service Group
(cid:31) Public Utility Systems Group
(cid:31) Corporate
Purchasing Div.
(cid:31) Energy & Industrial
Systems Group
(cid:31) Public Relations Div.
(cid:31) Corporate
Advertising Div.
(cid:31) Corporate Legal &
Compliance Div.
(cid:31) Corporate Export
Control Div.
(cid:31) Corporate Licensing Div.
(cid:31) Corporate Intellectual
Property Div.
(cid:31) Building Systems Group
(cid:31) Electronic Systems Group
(cid:31) Communication Systems Group
(cid:31) Living Environment & Digital
Media Equipment Group
(cid:31) Factory Automation
Systems Group
(cid:31) Automotive Equipment Group
(cid:31) Semiconductor & Device Group
22 MITSUBISHI ELECTRIC CORPORATION ANNUAL REPORT 2015
Business Planning Office
Market Planning & Administration Dept.
Compliance Dept.
Marketing Research & Business Development Dept.
Branch Offices (Hokkaido, Tohoku, Kanetsu, Kanagawa,
Hokuriku, Chubu, Kansai, Chugoku, Shikoku, Kyushu)
Global Planning & Administration Div.
Compliance Dept.
Regional Marketing Div.
Regional Strategic Development Div.
Regional Corporate Offices
Americas (U.S.A.)
Europe (U.K.)
Asia (Singapore)
China
Taiwan
Corporate Productivity Engineering Dept.
Compliance Dept.
Corporate Quality Assurance Planning Dept.
Corporate Environmental Sustainability Group
Corporate Logistics Dept.
Design Systems Engineering Center
Manufacturing Engineering Center
Planning & Administration Dept.
Compliance Dept.
Advanced Technology R&D Center
Information Technology R&D Center
Industrial Design Center
Planning & Administration Dept.
Compliance Dept.
Information Systems & Network Service Div.
Planning & Administration Dept.
Compliance Dept.
Engineering Planning Dept.
ITS Business Development Group
Public-Use Systems Marketing Div.
Transportation Systems Div.
Overseas Marketing Div.
Plant Engineering & Construction Div.
Branch Offices
Kobe Works, Itami Works, Nagasaki Works
Planning & Administration Dept.
Compliance Dept.
Engineering Planning Dept.
Nuclear Power Plant Technical Supervisory Office
Business Development & Strategic Planning Div.
Transmission & Distribution Systems Marketing Div.
Power & Energy Systems Marketing Div.
Nuclear Energy, Advanced Magnetic & Medical Systems Marketing Div.
Power Plant Engineering & Construction Center
Branch Offices
Energy Systems Center, Transmission & Distribution Systems Center,
Power Distribution Systems Center
Planning & Administration Dept.
Compliance Dept.
Engineering Planning Dept.
Total Security Systems Dept.
Domestic Marketing Div.
Overseas Marketing Div.
Building Systems Field Operation Div.
Branch Offices
Inazawa Works
Electronic Systems Compliance Dept.
Planning & Administration Dept.
Defense Systems Div.
Space Systems Div.
IT Space Solutions Div.
Branch Offices
Communication Systems Center, Kamakura Works
Planning & Administration Dept.
Compliance Dept.
Communication Systems Engineering Center
Telecommunication Systems Sales & Marketing Div.
Branch Offices
Communication Networks Center
Planning & Administration Dept.
Compliance Dept.
Engineering Dept.
Branding Strategy Dept.
External Relations Dept.
Customer Satisfaction Promotion Dept.
Marketing & Operations Strategic Planning Dept.
Eco-Facility Systems Marketing Dept.
Air-Conditioning & Refrigeration Systems Div.
Overseas Air-Conditioning & Refrigeration Systems Div.
Lighting, Ventilation, Home Equipment and Photovoltaic Systems Div.
Home Appliances & Digital Media Equipment Div.
Living Environment Systems Laboratory
Branch Offices
Nakatsugawa Works, Air-Conditioning & Refrigeration Systems Works,
Shizuoka Works, Kyoto Works, Gunma Works
Planning & Administration Dept.
Compliance Dept.
Industrial Products Marketing Div.
Industrial Automation Marketing Div.
Overseas Marketing Div.
Global Account Management Div.
Branch Offices
Nagoya Works, Fukuyama Works
Planning & Administration Dept.
Automotive Equipment Compliance Dept.
Automotive Equipment Marketing Div.
Automotive Electronics Development Center
Branch Offices
Himeji Works, Sanda Works
Planning & Administration Div.
Compliance Dept.
Semiconductor & Device Marketing Div. A
Semiconductor & Device Marketing Div. B
LCD Div.
Branch Offices
Power Device Works, High Frequency & Optical Device Works
Major Subsidiaries and Affiliates (As of March 31, 2015)
Manufacturing
Sales/Installation/Services
Comprehensive Sales Companies
Energy and
Electric Systems
Toyo Electric Corporation
Tada Electric Co., Ltd.
Mitsubishi Electric Building Techno-Service Co., Ltd.
Mitsubishi Electric Plant Engineering Corporation
Mitsubishi Electric Power Products, Inc.
Mitsubishi Electric Control Software Corporation
Mitsubishi Electric Shanghai Electric Elevator Co., Ltd.
Ryoden Elevator Construction, Ltd.
Mitsubishi Elevator Asia Co., Ltd.
Ryoko Co., Ltd.
Taiwan Mitsubishi Elevator Co., Ltd.
RYO-SA BUILWARE Co., Ltd.
Toshiba Mitsubishi-Electric Industrial Systems Corporation
Mitsubishi Hitachi Home Elevator Corporation
Shanghai Mitsubishi Elevator Co., Ltd.
Zhuzhou Shiling Transportation Equipment
Company Limited
Mitsubishi Elevator Hong Kong Co., Ltd.
Mitsubishi Elevator Korea Co., Ltd.
Hitachi Mitsubishi Hydro Corporation
ETA-Melco Elevator Co. L.L.C.
Industrial
Automation
Systems
DB Seiko Co., Ltd.
Ryowa Corporation
Mitsubishi Electric Automotive America, Inc.
Setsuyo Astec Corporation
Mitsubishi Electric Thai Auto-Parts Co., Ltd.
Ryoden Koki Engineering Co., Ltd.
Mitsubishi Electric Automotive (China) Co., Ltd.
Meldas System Engineering Corporation
Mitsubishi Electric Dalian Industrial Products Co., Ltd.
Mitsubishi Electric Mechatronics Software Corporation
Mitsubishi Electric Automation, Inc.
Mitsubishi Electric Automation (Hong Kong) Ltd.
Mitsubishi Electric Automotive Czech s.r.o.
Mitsubishi Electric Automation Korea Co., Ltd.
Chiyoda Mitsubishi Electric Co., Ltd. and
other regional comprehensive sales
companies (9 companies)
Mitsubishi Electric Europe B.V.
Mitsubishi Electric US, Inc.
Mitsubishi Electric Taiwan Co., Ltd.
Mitsubishi Electric & Electronics
(Shanghai) Co., Ltd.
Mitsubishi Electric Asia Pte. Ltd.
Mitsubishi Electric (H.K.) Ltd.
Mitsubishi Electric Australia Pty. Ltd.
Ryoden Trading Co., Ltd.
Kanaden Corporation
Mansei Corporation
Information and
Communication
Systems
Electronic
Devices
Home Appliances
Others
Shizuki Electric Co., Inc.
Nippon Injector Corporation
Shihlin Electric & Engineering Corporation
Mitsubishi Electric TOKKI Systems Corporation
Diamond Telecommunication Co., Ltd.
Mitsubishi Precision Co., Ltd.
SPC Electronics Corporation
Seiryo Electric Co., Ltd.
Oi Electric Co., Ltd.
Miyoshi Electronics Corporation
Mitsubishi Electric Information Systems Corporation
Mitsubishi Electric Information Network Corporation
Mitsubishi Space Software Co., Ltd.
Mitsubishi Electric Business Systems Co., Ltd.
Mitsubishi Electric Micro-Computer Application
Software Co., Ltd.
Itec Hankyu Hanshin Co., Ltd.
Melco Power Device Corporation
Melco Semiconductor Engineering Corporation
Melco Display Technology Inc.
Vincotech Holdings S.à r.l.
Powerex, Inc.
Mitsubishi Electric Lighting Corporation
Mitsubishi Electric Home Appliance Co., Ltd.
Mitsubishi Electric Consumer Products
(Thailand) Co., Ltd.
Shanghai Mitsubishi Electric & Shangling
Air-Conditioner and Electric Appliance Co., Ltd.
Mitsubishi Electric (Guangzhou) Compressor Co., Ltd.
Siam Compressor Industry Co., Ltd.
Mitsubishi Electric Air Conditioning Systems Europe Ltd.
Kang Yong Electric Public Co., Ltd.
Mitsubishi Electric Living Environment
Systems Corporation
Mitsubishi Electric Life Network Co., Ltd.
Mitsubishi Electric Air Conditioning &
Refrigeration Equipment Sales Co., Ltd.
Mitsubishi Electric Air Conditioning &
Refrigeration Systems Co., Ltd.
Melco Facilities Corporation
Mitsubishi Electric Kang Yong Watana Co., Ltd.
Mitsubishi Electric Air-Conditioning &
Visual Information Systems (Shanghai) Ltd.
Mitsubishi Electric Trading Corporation
Mitsubishi Electric Engineering Co., Ltd.
Mitsubishi Electric Logistics Corporation
Mitsubishi Electric System & Service Co., Ltd.
Mitsubishi Electric Life Service Corporation
The Kodensha Co., Ltd.
iPLANET Inc.
Melco Trading (Thailand) Co.,Ltd.
Mitsubishi Electric Credit Corporation
KITA KOUDENSHA Corporation
Notes:
1. Comprehensive sales companies include several companies that are responsible for selling products from a number of businesses, and therefore these are placed into their own
separate category rather than grouped by business segment.
2. Companies shaded in gray are consolidated subsidiaries, while others are equity-method affiliate companies.
MITSUBISHI ELECTRIC CORPORATION ANNUAL REPORT 2015 23
24 MITSUBISHI ELECTRIC CORPORATION ANNUAL REPORT 2015
Financial Section
Contents
26 Five-Year Summary
27 Financial Review
36 Consolidated Balance Sheets
38 Consolidated Statements of Income
38 Consolidated Statements of Comprehensive Income
39 Consolidated Statements of Equity
40 Consolidated Statements of Cash Flows
41 Notes to Consolidated Financial Statements
74
Independent Auditors’ Report
MITSUBISHI ELECTRIC CORPORATION ANNUAL REPORT 2015 25
Five-Year Summary
Mitsubishi Electric Corporation and Subsidiaries
Years ended March 31
2015
2014
2013
2012
2011
Yen (millions)
U.S. dollars
(thousands)
2015
Summary of Operations
Net sales
Cost of sales
Selling, general, administrative
and R&D expenses
Loss on impairment of
long-lived assets
Operating costs
Operating income
Income before income taxes
Net income attributable
¥4,323,041
3,032,161
¥4,054,359
2,914,589
¥3,567,184
2,604,360
¥3,639,468
2,628,964
¥3,645,331
2,622,959
$36,025,342
25,268,009
970,191
900,807
806,412
781,278
784,606
8,084,925
3,085
3,791
4,317
3,782
4,005
25,708
4,005,437
3,819,187
3,415,089
3,414,024
3,411,570
33,378,642
317,604
322,968
235,172
248,990
152,095
65,141
225,444
224,080
233,761
210,237
2,646,700
2,691,400
to Mitsubishi Electric Corp.
¥ 234,694
¥ 153,473
¥ 69,517
¥ 112,063
¥ 124,525
$ 1,955,783
Financial Ratios
Return on sales (%)
Return on equity (%)
Return on assets (%)
Equity ratio (%)
Per-Share Amounts
Net income attributable
to Mitsubishi Electric Corp.
(yen/U.S. dollars)
Basic
Diluted
Cash dividends declared
(yen/U.S. dollars)
Statistical Information
Current assets
Current liabilities
Working capital
Mitsubishi Electric Corp.
shareholders’ equity
Cash dividends paid
Total assets
Capital expenditures
R&D expenditures
Depreciation
Employees
5.43
13.94
6.12
45.38
3.79
10.87
4.37
42.19
1.95
5.72
2.04
38.12
3.08
10.27
3.33
33.39
3.42
12.36
3.80
31.52
—
—
—
—
¥109.32
—
¥71.49
—
¥32.38
—
¥52.20
—
¥58.00
—
$0.911
—
¥ 27
¥ 17
¥ 11
¥ 12
¥ 12
$0.225
¥2,633,445
1,612,582
¥2,290,007
1,494,243
¥2,129,395
1,386,067
¥2,180,362
1,387,744
¥2,052,887
1,421,174
$21,945,375
13,438,183
1,020,863
795,764
743,328
792,618
631,713
8,507,192
1,842,203
42,936
4,059,451
199,758
195,314
¥ 156,205
1,524,322
25,762
3,612,966
151,840
178,945
¥ 132,956
1,300,070
23,616
3,410,410
150,425
172,222
¥ 127,942
1,132,465
27,910
3,391,651
159,346
169,686
¥ 127,244
1,050,340
19,315
3,332,679
107,638
151,779
¥ 105,280
15,351,692
357,800
33,828,758
1,664,650
1,627,617
$ 1,301,708
(at the end of the year)
129,249
124,305
120,958
117,314
114,443
—
Notes: 1. The Company prepares consolidated financial statements with procedures, accounting terms, forms, and preparation that are in conformity with accounting
principles generally accepted in the United States of America based on the rules and regulations applicable in Japan.
2. Operating income is presented as net sales less cost of sales, selling, general, administrative and R&D expenses, and loss on impairment of long-lived assets. Total
operating income for each segment conforms to above mentioned operating income. Business restructuring expenses are shown as non-operating expenses.
3. R&D expenditures include elements spent on quality improvements, which constitute manufacturing costs.
4. U.S. dollar amounts are translated from yen at the rate of ¥120=U.S.$1, the approximate rate on the Tokyo Foreign Exchange Market on March 31, 2015.
5. The Company has 172 consolidated subsidiaries and 36 equity-method companies as of March 31, 2015.
6. Diluted net income per share attributable to Mitsubishi Electric Corp. is not included in the above table as no dilutive securities existed.
26 MITSUBISHI ELECTRIC CORPORATION ANNUAL REPORT 2015
Financial Review
OVERVIEW
The business environment in the fiscal year ended March 31, 2015 (hereinafter, fiscal 2015) in general experienced an gradual
upward trend, with buoyant economic expansion in the U.S. and economic recovery in Europe having a positive effect, despite
Japan’s economy remaining in a state of weak recovery centered around consumption and despite the economic slowdown
in China and some emerging markets. In addition, the weakening of the yen advanced against the U.S. dollar, while the yen
became stronger against the euro.
Under these circumstances, the Mitsubishi Electric Group has been working even harder than before to promote growth
strategies rooted in its advantages, while continuously implementing initiatives to strengthen its competitiveness and business
structure.
As a result, in fiscal 2015, the Mitsubishi Electric Group recorded net sales of 4,323.0 billion yen and operating income
of 317.6 billion yen. Income before income taxes came to 322.9 billion yen. Net income attributable to Mitsubishi Electric
Corporation was 234.6 billion yen for the fiscal year.
Net Sales
The Mitsubishi Electric Group recorded increases in sales in all its business seg-
ments, namely, Energy and Electric Systems, Industrial Automation Systems,
Information and Communication Systems, Electronic Devices, Home Appliances
and Others. In the fiscal year, consolidated net sales climbed by ¥268.6 billion
Net sales / Operating income
4.32
4.05
3.643.63
3.56
year on year to ¥4,323.0 billion.
Cost of Sales, Expenses and Operating Income
The cost of sales increased by ¥117.5 billion compared with the previous fiscal
year to ¥3,032.1 billion, representing 70.1% of total net sales, an improvement
of 1.8 percentage points. Selling, general and administrative (SG&A) expenses
317
233
225
235
152
together with research and development (R&D) expenses totaled ¥970.1 billion,
11 12 13 14
15
11 12 13 14
15
up ¥69.3 billion year on year. As a result, the ratio of SG&A and R&D expenses to
Net sales
net sales deteriorated by 0.3 of a percentage point year on year to 22.5%. Loss
(Yen in trillions)
Operating income
(Yen in billions)
on impairment of long-lived assets decreased by ¥0.7 billion year on year to ¥3.0
billion.
Accounting for the aforementioned factors, operating income amounted
to ¥317.6 billion, an increase of ¥82.4 billion compared with the previous fiscal
year. This increase was primarily attributable to higher income in the Industrial
Automation Systems, Information and Communications Systems, Electronic
Devices, Home Appliances, and Other business segments.
Non-Operating Income and Expenses
Financial income, the sum of interest and dividend income less interest expenses,
amounted to ¥3.3 billion, essentially unchanged from the previous fiscal year.
Equity in earnings of affiliated companies totaled ¥27.7 billion, an improve-
ment of ¥4.5 billion compared with the previous fiscal year.
Net income attributable to Mitsubishi Electric Corp. /
Basic net income per share attributable to
Mitsubishi Electric Corp.
234
153
124
112
69
109.32
71.49
58.00
52.20
32.38
Other income increased by ¥18.7 billion to ¥43.3 billion year on year. Other
11 12 13 14
15
11 12 13 14
15
expenses grew by ¥31.8 billion year on year to ¥69.0 billion.
Income before Income Taxes
Net income attributable
to Mitsubishi Electric Corp.
(Yen in billions)
Basic net income per share
attributable to Mitsubishi
Electric Corp. (Yen)
Income before income taxes increased by ¥73.9 billion compared with the previous fiscal year to ¥322.9 billion, for a ratio to net
sales of 7.5%. As previously mentioned, this is largely attributable to the aforementioned upswing in operating income of ¥82.4
billion.
Net Income Attributable to Mitsubishi Electric
Net income attributable to Mitsubishi Electric Corp. grew by ¥81.2 billion year on year to ¥234.6 billion (a ratio to net sales of
5.4%) largely on the back of the increase in income before income taxes.
MITSUBISHI ELECTRIC CORPORATION ANNUAL REPORT 2015 27
Business Risks
The Mitsubishi Electric Group engages in the development, manufacture and sale of products in the Energy and Electric Systems,
Industrial Automation Systems, Information and Communication Systems, Electronic Devices, Home Appliances and Other busi-
ness fields in Japan as well as North America, Europe, Asia and other overseas regions. As a result, the Group’s financial standing
and business performance may be affected by a variety of factors.
Factors that may affect the financial standing and business performance of the Mitsubishi Electric Group include but are not
limited to the following. As such, additional factors may arise at any given time.
(1) Important trends
The Mitsubishi Electric Group’s operations may be affected by trends in the global economy, social conditions, laws, tax
codes and regulations.
(2) Foreign currency exchange rates
Fluctuations in foreign currency markets may affect Mitsubishi Electric’s sales of exported products and purchases of import-
ed materials that are denominated in U.S. dollars or euros, as well as its Asian production bases’ sales of exported products
and purchases of imported materials that are denominated in foreign currencies.
(3) Stock markets
A fall in stock market prices may cause Mitsubishi Electric to record devaluation losses on marketable securities or cause an
increase in retirement benefit obligations in accordance with a decline in the fair value of pension assets.
(4) Supply/demand balance for products and procurement conditions for materials and components
A decline in prices and shipments due to changes in the supply/demand balance as well as an increase in costs due to
a worsening of material and component procurement conditions may adversely affect the Mitsubishi Electric Group’s
performance.
(5) Fund raising
An increase in interest rates, the yen interest rate in particular, would increase Mitsubishi Electric’s interest expenses.
(6) Significant intellectual property matters
Important patent filings, licensing, copyrights and patent-related disputes may adversely affect related businesses.
(7) Environmental legislation or relevant issues
Mitsubishi Electric may incur losses or expenses owing to changes in environmental legislation or the occurrence of envi-
ronmental issues. Such changes in legislation or the occurrence of environmental issues may also affect the Group’s overall
operations, including manufacturing activities.
(8) Flaws or defects in products or services
Mitsubishi Electric may incur losses or expenses relating to flaws or defects in products or services. A decrease in the general
assessment of the quality of Group products and services may also impact overall operations.
(9) Lawsuits and other legal proceedings
Lawsuits and/or other legal proceedings against the Mitsubishi Electric Group may affect its overall operations.
(10) Disruptive changes
Disruptive changes in the technology, development and manufacturing of products using new technology and timing of
market introduction may adversely affect the Mitsubishi Electric Group’s performance.
(11) Business restructuring
The Mitsubishi Electric Group may record losses due to restructuring measures.
(12) Incidents related to information security
The performance of the Mitsubishi Electric Group may be affected by computer virus infections, unauthorized access and
other unpredictable incidents that lead to the loss or leakage of personal information held by the Group or confidential
information regarding the Group’s business such as its technology, sales and other operations.
(13) Natural disasters
The Mitsubishi Electric Group’s operations, particularly manufacturing activities, may be affected by the occurrence of earth-
quakes, typhoons, tsunami, fires and other large-scale disasters.
(14) Other significant factors
The Mitsubishi Electric Group‘s operations may be affected by the outbreak of social or political upheaval due to terrorism,
war, pandemic by new strains of influenza and other diseases, or other factors.
28 MITSUBISHI ELECTRIC CORPORATION ANNUAL REPORT 2015
RESULTS BY BUSINESS SEGMENT
Net Sales by Business Segment
Yen (millions)
U.S. dollars
(thousands)
Years ended March 31
2015
2014
2013
2012
2011
2015
Energy and Electric Systems
Industrial Automation Systems
Information and
Communication Systems
Electronic Devices
Home Appliances
Others
Subtotal
Eliminations
Consolidated total
¥1,228,958
1,282,749
¥1,180,093
1,098,796
¥1,058,177
927,857
¥1,027,115
978,380
¥1,027,749
927,002
$10,241,317
10,689,575
559,521
238,402
944,830
740,517
4,994,977
(671,936)
¥4,323,041
548,282
194,658
944,351
676,034
4,642,214
(587,855)
¥4,054,359
522,422
164,065
821,298
590,366
4,084,185
(517,001)
¥3,567,184
516,354
200,799
849,274
611,619
4,183,541
(544,073)
¥3,639,468
487,915
175,910
924,478
609,416
4,152,470
(507,139)
¥3,645,331
4,662,675
1,986,683
7,873,583
6,170,975
41,624,808
(5,599,466)
$36,025,342
Operating Income (Loss) by Business Segment
Yen (millions)
U.S. dollars
(thousands)
Years ended March 31
2015
2014
2013
2012
2011
2015
Energy and Electric Systems
Industrial Automation Systems
Information and
Communication Systems
Electronic Devices
Home Appliances
Others
Subtotal
Eliminations and other
Consolidated total
¥ 72,448
145,982
¥ 76,324
98,079
¥ 85,140
60,592
¥ 84,920
101,192
¥ 83,055
100,089
$ 603,733
1,216,517
18,934
30,163
54,296
23,742
345,565
(27,961)
¥317,604
5,529
10,050
52,878
19,801
262,661
(27,489)
¥235,172
1,591
(5,580)
19,300
18,790
179,833
(27,738)
¥152,095
21,312
3,585
22,358
20,348
253,715
(28,271)
¥225,444
13,743
5,901
42,008
14,475
259,271
(25,510)
¥233,761
157,783
251,358
452,467
197,850
2,879,708
(233,008)
$2,646,700
Energy and Electric Systems
The social infrastructure systems business saw a decrease in orders compared
to the previous fiscal year due primarily to a decrease in the power genera-
tion and public utility systems businesses in Japan. Sales, meanwhile, remained
unchanged compared to the previous fiscal year owing to increases in the rolling-
stock equipment business outside Japan.
The building systems business experienced increases in both orders and sales
compared to the previous fiscal year, owing to growth in new installation of
elevators and escalators overseas, mainly in China and ASEAN countries, as well
as the weaker yen.
Net sales and Operating income of
Energy and Electric Systems
1,1801,228
83 84 85
1,0271,027 1,058
76
72
As a result, total sales for this segment increased by 4% from the previous
11 12 13 14
15
11 12 13 14
15
fiscal year to 1,228.9 billion yen. Operating income decreased by 3.8 billion yen
from the previous fiscal year to 72.4 billion yen due primarily to a shift in project
Net sales
(Yen in billions)
Operating income
(Yen in billions)
portfolio.
Industrial Automation Systems
The factory automation systems business saw increases in both orders and sales
from the previous fiscal year due to growth in capital expenditures relating to
smartphone and automotive industries as well as facility replacements by manu-
facturers in Japan, and due additionally to the weaker yen.
The automotive equipment business saw increases in both orders and sales
from the previous fiscal year due primarily to growth in the car sales market in
North America and China, as well as the positive influence of the weaker yen.
As a result, total sales for this segment increased by 17% from the previous
Net sales and Operating income of
Industrial Automation Systems
1,282
145
1,098
978
927
927
100 101
98
60
fiscal year to 1,282.7 billion yen. Operating income increased by 47.9 billion yen
11 12 13 14
15
11 12 13 14
15
from the previous fiscal year to 145.9 billion yen due primarily to an increase in
sales.
Net sales
(Yen in billions)
Operating income
(Yen in billions)
MITSUBISHI ELECTRIC CORPORATION ANNUAL REPORT 2015 29
Information and Communication Systems
The telecommunications equipment business saw decreases in both orders and
sales from the previous fiscal year due primarily to a decrease in demand for
communications infrastructure products.
Sales in the information systems and services business saw decreases com-
Net sales and Operating income of
Information and Communication Systems
559
548
21
516 522
487
18
pared to sales of the previous fiscal year mainly due to decreases in system inte-
13
gration business.
The electronic systems business saw a decrease in orders compared to the
previous fiscal year due to decreases in large-scale projects in the defense system
and space system businesses. Sales, meanwhile, experienced an increase com-
pared to the previous fiscal year due to progress in orders already received for
projects in the defense systems business.
5
1
11 12 13 14
15
11 12 13 14
15
As a result, total sales for this segment increased by 2% compared with the
previous fiscal year to 559.5 billion yen. Operating income increased by 13.4
billion yen from the previous fiscal year to 18.9 billion yen due primarily to an
Net sales
(Yen in billions)
Operating income
(Yen in billions)
Net sales and Operating income (loss) of
Electronic Devices
increase in sales.
Electronic Devices
The electronic devices business saw increases in both orders and sales from the
previous fiscal year due to an increase in demand mainly for power modules used
in automotive applications owing to expansion in hybrid and electric vehicle mar-
kets, as well as an increase in demand for power modules used in railcar, con-
sumer and industrial applications and for optical communication devices mainly
in the Chinese market, and due additionally to the weaker yen.
238
30
200
194
164
175
10
5
3
-5
As a result, total sales for this segment increased by 22% compared with the
11 12 13 14
15
11 12 13 14
15
previous fiscal year to 238.4 billion yen. Operating income increased by 20.1 bil-
lion yen compared with the previous fiscal year to 30.1 billion yen due primarily
to an increase in sales.
Home Appliances
The home appliances business remained substantially unchanged compared with
the previous fiscal year with total sales for this segment amounting to 944.8
billion yen, despite increased sales in air conditioners in Asian, North American
and European markets and in package air conditioners in Japan, as well as the
weaker yen, due to impact from the last-minute surge in demand experienced in
Japan before the rise in consumption tax the previous year.
Operating income increased by 1.4 billion yen compared with the previous
Net sales
(Yen in billions)
Operating income (loss)
(Yen in billions)
Net sales and Operating income of Home Appliances
924
944
944
849
821
54
52
42
22
19
fiscal year to 54.2 billion yen largely due to the weaker yen.
11 12 13 14
15
11 12 13 14
15
Others
Sales increased by 10% compared with the previous fiscal year to 740.5 billion
yen, mainly at affiliated companies involved in materials procurement.
Operating income increased by 3.9 billion yen compared with the previous
fiscal year to 23.7 billion yen due primarily to an increase in sales.
Net sales
(Yen in billions)
Operating income
(Yen in billions)
Net sales and Operating income of Others
740
676
609
611
590
23
20
19
18
14
30 MITSUBISHI ELECTRIC CORPORATION ANNUAL REPORT 2015
11 12 13 14
15
11 12 13 14
15
Net sales
(Yen in billions)
Operating income
(Yen in billions)
RESULTS BY GEOGRAPHIC SEGMENT
Net Sales by Geographic Segment
Yen (millions)
U.S. dollars
(thousands)
Years ended March 31
Japan
North America
Asia (excluding Japan)
Europe
Others
Eliminations
Consolidated total
2015
2014
2013
2012
2011
2015
¥ 3,578,960
388,021
1,047,758
383,965
49,495
¥3,362,854
325,224
887,022
352,950
47,824
¥3,064,014
248,105
624,724
289,933
40,255
¥3,186,719
222,543
582,888
309,997
40,184
¥3,176,605
229,958
583,827
293,952
38,200
(1,125,158)
¥ 4,323,041
(921,515)
¥4,054,359
(699,847)
¥3,567,184
(702,863)
¥3,639,468
(677,211)
¥3,645,331
$29,824,667
3,233,508
8,731,317
3,199,708
412,458
(9,376,316)
$36,025,342
Operating Income (Loss) by Geographic Segment
Yen (millions)
U.S. dollars
(thousands)
Years ended March 31
Japan
North America
Asia (excluding Japan)
Europe
Others
Eliminations
Consolidated total
2015
2014
2013
2012
2011
2015
¥226,199
5,178
82,419
11,803
402
(8,397)
¥317,604
¥177,315
1,679
59,023
4,768
1,735
(9,348)
¥235,172
¥116,923
(1,744)
36,172
4,527
2,209
(5,992)
¥152,095
¥179,452
3,339
34,220
6,319
3,905
(1,791)
¥225,444
¥177,354
1,363
43,734
7,830
4,329
(849)
¥233,761
$1,884,992
43,150
686,825
98,358
3,350
(69,975)
$2,646,700
Japan
Sales totaled 3,578.9 billion yen, up 6% compared with the previous fiscal year. This largely reflected the upswing in sales in the
FA systems, automotive equipment, and semiconductor businesses. Operating income increased by 48.8 billion yen to 226.1 bil-
lion yen.
North America
Sales increased by 19% year on year to 388.0 billion yen primarily due to higher sales in the FA systems, and automotive equip-
ment businesses. Mitsubishi Electric reported operating income in its operations in North America totaling 5.1 billion yen. This
was an improvement of 3.4 billion yen compared with the previous fiscal year.
Asia (excluding Japan)
Sales totaled 1,047.7 billion yen, up 18% compared with the previous fiscal year mainly because of higher sales in the FA sys-
tems, automotive equipment, and air conditioner businesses. Operating income increased by 23.3 billion yen to 82.4 billion yen.
Europe
Sales increased by 9% year on year to 383.9 billion yen mainly because of higher sales in the FA systems, automotive equipment,
and air conditioner businesses. Operating income increased by 7.0 billion yen to 11.8 billion yen.
Others
Sales in other regions, including figures for Mitsubishi Electric’s Australian subsidiary, amounted to 49.4 billion yen, while operat-
ing income was 0.4 billion yen.
MITSUBISHI ELECTRIC CORPORATION ANNUAL REPORT 2015 31
RESEARCH AND DEVELOPMENT
R&D Expenditures
Yen (billions)
U.S. dollars
(millions)
Years ended March 31
2015
2014
2013
2012
2011
2015
Energy and Electric Systems
¥ 31.4
¥ 28.8
¥ 29.8
¥ 30.5
¥ 27.0
$ 261.7
Industrial Automation Systems
Information and Communication Systems
Electronic Devices
Home Appliances
Others
Consolidated total
70.5
16.3
10.9
37.3
28.6
63.4
15.6
9.3
34.1
27.5
58.9
16.4
8.2
30.8
27.7
54.9
16.1
9.3
30.4
28.2
44.9
14.9
8.5
30.7
25.5
587.5
135.8
90.8
310.8
238.3
¥195.3
¥178.9
¥172.2
¥169.6
¥151.7
$1,627.6
The Mitsubishi Electric Group actively promotes R&D initiatives that cover fundamental and advanced applications as well as
product commercialization and manufacturing technologies. Carrying out these initiatives are various Group facilities, including
corporate laboratories in Japan and laboratories in the United States and Europe as well as the R&D departments of factories and
consolidated subsidiaries. Moreover, we pursue advanced and wide-ranging R&D activities in partnership with universities and
research institutions both in Japan and overseas.
In fiscal 2015, total R&D expenditures, including quality improvement expenses constituting manufacturing costs, amount-
ed to ¥195.3 billion. Mitsubishi Electric reports R&D activities by business segment according to purpose, type, result and
expenditure.
In the Energy and Electric Systems segment, our research is directed at boosting the competitiveness of such core products
as rotating machines for generators, electric motors and other machinery; switches and transformers; other power transmis-
sion/ distribution/reception equipment and systems; transportation systems; and elevators and escalators. Other R&D areas
include IT-application systems for supervision and control, power information systems, building management systems and visual
information systems. Notable among Mitsubishi Electric’s recent R&D achievements are the 3 screen layout train vision system;
the MELNET-ES1200 high-reliability Ethernet switch; heat pump technologies for rolling stock air-conditioning equipment; the
SVC-Diamond static synchronous compensator; the acquisition of three communication standards between communication unit
for smart meter and HEMS equipment; the completion of VP-X series high efficiency turbine generator verification tests; the
launch of NEXIEZ-LITE low- and mid-rise residential and office building elevators in the Indian market; the Destination Oriented
Allocation System for elevators; and the MELSAFETY-Px access control system for small to mid-sized buildings. R&D expenditures
in this segment totaled ¥31.4 billion.
In the Industrial Automation Systems segment, R&D activities are aimed at enhancing the competitiveness of our lineup,
which includes FA control equipment and systems; drive products such as AC servo motor systems; power distribution and con-
trol equipment; mechatronics equipment; industrial robots; automotive electric and electronic components, including electric
power steering (EPS) and related products; and car multimedia systems. Mitsubishi Electric’s important R&D successes encompass
the MELSEC iQ-R and iQ-F series programmable controllers; the FREQROL-F800 series of general-purpose inverters; the M800S
series and M80 series of computerized numerical controllers; the MP series of
wire-cut electrical discharge machines; the NR-MZ90 series DIATONE SOUND.
R&D expenditures
R&D expenditures ratio
NAVI car audio and navigation system; the DS-G500 DIATONE car speaker; a
power unit for the three-motor HEV system; an eighth-generation airbag control
unit; and a next-generation brushless alternator. R&D expenditures in this seg-
195
172 178
169
151
4.7
4.8
4.5
4.4
4.2
ment totaled ¥70.5 billion.
In the Information and Communication Systems segment, Mitsubishi Electric
pursues research related to the development of information and communications
infrastructure, network solutions equipment, and space systems. Notable R&D
successes for Mitsubishi Electric include the “smartstar” communication gate-
way; the new functions of MELOOKμI I recorder; the PON protection function for
10G-EPON system; GE-PON systems for smart grid; the 100G media converter;
11 12 13 14
15
11 12 13 14
15
the HM-3000 high-sensitivity 3 MOS HD PTZ camera; the DIAPLANET smart
control cloud service; the DIASITE website solution; and the MIND tablet PC that
R&D expenditures
(Yen in billions)
R&D expenditures /
Net sales (%)
32 MITSUBISHI ELECTRIC CORPORATION ANNUAL REPORT 2015
combines PC functions with the lightweight convenience of a portable tablet device. R&D expenditures in this segment totaled
¥16.3 billion.
In the Electronic Devices segment, our R&D focuses on semiconductor and other electronic devices that are themselves vital
components used in all our business segments. Major R&D achievements include SiC power semiconductor modules such as the
super-mini full SiC DIPPFC; power semiconductor modules for 3-level inverters; the J1-Series of power semiconductor modules
for automobiles; the 3.5GHz-band GaN-HEMT for 4G mobile-communication base transceiver stations; the 100Gbps DWDM
tunable DFB laser array; and tough-series 7.0-inch WVGA color TFT-LCD modules for industrial applications. R&D expenditures in
this segment totaled ¥10.9 billion.
In the Home Appliances segment, Mitsubishi Electric is engaged in the development of products in such wide-ranging fields
as air conditioning equipment, kitchen appliances, vacuum cleaners, lighting, visual information systems, electronic housing
products and photovoltaic systems. Major R&D achievements include the KIRIGAMINE L series room air conditioners that can be
installed in narrow spaces above windows; the JX series of smart refrigerators with super cool chilling case; the iNSTICK cordless
stick cleaner; the REAL 4K LS1 series of LCD televisions equipped with 4K high-definition laser backlights; and the smart house-
related brand called ENEDIA:Energy-management Network Enhancing Demand-side Integration Activities. R&D expenditures in
this segment totaled ¥37.3 billion.
In Others, fundamental technology R&D that benefits the entire Group is carried out to enhance global business competitive-
ness and create new businesses. In our main areas of R&D we have developed multi-function irradiation technologies for proton-
type particle therapy systems; tsunami radar monitoring technologies; water treatment technology using gas/liquid interfacial
discharge; security solution for IoT devices; cutting tool position-control method for machine; a multihop wireless network for
surveillance cameras; and the establishment of production systems for multi-story production facilities. R&D expenditures in this
area amounted to ¥28.6 billion.
MITSUBISHI ELECTRIC CORPORATION ANNUAL REPORT 2015 33
FINANCIAL POSITION
Total assets amounted to ¥4,059.4 billion as of March 31, 2015, an increase of
Interest-bearing debt
Debt ratio
¥446.4 billion compared with the end of previous fiscal year. The change in the
balance of total assets is mainly attributable to increases of ¥150.4 billion in cash
and cash equivalents; ¥103.0 billion in inventories; ¥87.3 billion in investments in
542
540
484
securities and other on the back of such factors as the upswing in share prices;
¥65.8 billion in trade receivables and long-term trade receivables; and ¥57.0 bil-
373
381
16.0 15.9
lion in tangible fixed assets.
Under liabilities, the outstanding balance of debt and corporate bonds grew
by ¥8.5 billion compared with the end of the previous fiscal year to ¥381.9 bil-
lion. As a result, the ratio of interest-bearing debt to total assets was 9.4%, a
decrease of 0.9 of a percentage point year on year. While retirement and sever-
ance benefits fell by ¥30.3 billion largely because of an increase in pension plan
assets caused by higher share prices, trade payables and other current liabilities
increased by ¥48.3 billion and ¥34.6 billion, respectively. As a result of these and
other factors, total liabilities increased by ¥116.6 billion to ¥2,129.2 billion.
Mitsubishi Electric Corp. shareholders’ equity rose by ¥317.8 billion com-
pared with the end of previous fiscal year to ¥1,842.2 billion and the ratio of
Mitsubishi Electric Corp. shareholders’ equity to total assets was 45.4%, up 3.2
percentage points year on year. Despite the decrease attributable to the payment
of cash dividends totaling ¥42.9 billion, this increase was largely the result of the
net income attributable to Mitsubishi Electric Corp. amounting to ¥234.6 billion
for the fiscal year and the increase in accumulated other comprehensive income
of ¥122.1 billion, reflecting such factors as the weak yen and upswing in share
prices.
14.5
10.3
9.4
11 12 13 14
15
11 12 13 14
15
Interest-bearing debt
(Yen in billions)
Interest-bearing debt /
Total assets (%)
Total assets /
Mitsubishi Electric Corp.
shareholders’ equity
Shareholders’
equity ratio
4,059
3,3323,3913,410
3,612
45.4
42.2
38.1
33.4
31.5
1,842
1,524
1,300
1,050 1,132
11 12 13 14
15
11 12 13 14
15
Total assets
(Yen in billions)
Mitsubishi Electric Corp.
shareholders’ equity
(Yen in billions)
Shareholders’ equity ratio
(%)
34 MITSUBISHI ELECTRIC CORPORATION ANNUAL REPORT 2015
CAPITAL EXPENDITURES
In line with its policy of improving performance by implementing the Balanced
Capital expenditures
Depreciation
Corporate Management Policy and pursuing sustainable growth, the Mitsubishi
Electric Group aims to realize its growth strategies as it increases profitability. To
199
that end, the Group directed its capital investment mainly toward the areas of
energy and electric systems, factory automation equipment, automotive equip-
ment, power devices, and air conditioning equipment. At the same time the
Group continued to reinforce its solid business platform through the careful
159
150
151
107
156
127
127
132
105
selection and concentration of investments.
On an individual business segment basis, investments were made in Energy
and Electric Systems (including power systems, electric equipment for roll-
ing stock, and elevators/escalators) aimed at increasing production capacity,
streamlining operations, and enhancing quality. In Industrial Automation, capital
expenditures were used primarily for boosting production capacity for factory
automation systems and automotive equipment operations. In Information and
11 12 13 14
15
11 12 13 14
15
Capital expenditures
(Yen in billions)
Depreciation
(Yen in billions)
Communication Systems, funds were appropriated for bolstering research and development capabilities, while in Electronic
Devices, Mitsubishi Electric directed investment mainly toward augmenting production in the power device business. In Home
Appliances, expenditures focused largely on increasing the air conditioners production capacity, streamlining operations, and
enhancing quality. In Common and Others, investments mainly went toward boosting research and development capabilities.
Capital expenditures are derived from cash on hand and funds from operations. For this fiscal year, production capacity was
not materially affected by the sale, disposal, damage, or loss due to natural disaster of property, plant and equipment.
CASH FLOWS
In the year ended March 31, 2015, net cash provided by operating activities
Cash flows
amounted to ¥378.3 billion, while net cash used in investing activities was
¥198.1 billion. As a result, free cash flow was an inflow of ¥180.1 billion, down
¥130.1 billion compared with the previous fiscal year. Taking this into account
along with net cash used in financing activities of ¥49.6 billion, the end of fis-
cal year cash and cash equivalents amounted to ¥568.5 billion, an increase of
¥150.4 billion year on year.
Net cash provided by operating activities decreased by ¥62.1 billion com-
440
378
327
310
182
180
75
82
pared with the previous fiscal year to ¥378.3 billion. Despite posting net income
248.0 billion, this downturn was largely attributable to increases in invento-
of ¥248.0 billion, this downturn was largely attributable to increases in invento-
¥248.0 billion, this downturn was largely attributable to increases in invento-
-145 -156
-153
-130
-198
-80 -70
ries and trade receivables.
Net cash used in investing activities increased by ¥67.9 billion year on year
to ¥198.1 billion. During the period, purchase of property, plant and equipment
increased while proceeds from the sale of short-term investments and investment
securities decreased.
Net cash used in financing activities was ¥49.6 billion, down ¥159.3 bil-
lion year on year. Despite an outflow due to cash dividends paid, cash inflows
increased due to the procurement of funds through increases in borrowings and
the issuance of bonds.
11 12 13 14
15
11 12 13 14
15
Net cash provided by
operating activities
(Yen in billions)
Net cash used in investing
activities (Yen in billions)
Free cash flows
(Yen in billions)
MITSUBISHI ELECTRIC CORPORATION ANNUAL REPORT 2015 35
Consolidated Balance Sheets
Mitsubishi Electric Corporation and Subsidiaries
March 31, 2015 and 2014
Assets
Current assets:
2015
Yen (millions)
2014
U.S. dollars
(thousands)
(note 2)
2015
Cash and cash equivalents
¥ 568,517
¥ 418,049
$ 4,737,642
Short-term investments (notes 3, 17 and 18)
Trade receivables (notes 4, 6 and 15)
Inventories (note 5)
Prepaid expenses and other current assets (notes 9, 14 and 18)
—
1,048,542
705,420
310,966
51
983,468
602,341
286,098
Total current assets
2,633,445
2,290,007
—
8,737,850
5,878,500
2,591,383
21,945,375
Long-term receivables and investments:
Long-term trade receivables (note 17)
Investments in securities and other (notes 3, 10, 14, 17 and 18)
Investments in affiliated companies (note 6)
Total long-term receivables and investments
5,633
401,367
194,461
601,461
4,813
314,047
183,463
502,323
46,942
3,344,725
1,620,508
5,012,175
Property, plant and equipment (notes 18, 19 and 20):
Land
Buildings
Machinery and equipment
Construction in progress
Less accumulated depreciation
Net property, plant and equipment
109,708
749,926
104,272
703,223
1,844,255
1,712,632
48,328
2,752,217
2,045,742
706,475
54,632
2,574,759
1,925,374
649,385
914,233
6,249,384
15,368,792
402,733
22,935,142
17,047,850
5,887,292
Other assets (notes 9 and 18)
118,070
171,251
983,916
Total assets
¥4,059,451
¥3,612,966
$33,828,758
See accompanying notes to consolidated financial statements.
36 MITSUBISHI ELECTRIC CORPORATION ANNUAL REPORT 2015
Liabilities and Equity
Current liabilities:
Bank loans (note 7)
Current portion of long-term debt (notes 7, 17 and 20)
Trade payables (notes 6 and 8)
Accrued expenses (note 16)
Accrued income taxes (note 9)
Other current liabilities (notes 10, 14 and 18)
2015
Yen (millions)
2014
U.S. dollars
(thousands)
(note 2)
2015
¥ 72,385
¥ 60,275
$ 603,208
92,017
807,289
358,082
29,624
253,185
101,777
758,913
337,571
17,151
218,556
766,808
6,727,408
2,984,017
246,867
2,109,875
Total current liabilities
1,612,582
1,494,243
13,438,183
Long-term debt (notes 7, 17 and 20)
Retirement and severance benefits (note 10)
Other liabilities (notes 9 and 16)
Total liabilities
217,592
182,282
116,828
211,426
212,638
94,308
2,129,284
2,012,615
1,813,266
1,519,017
973,567
17,744,033
Mitsubishi Electric Corp. shareholders' equity
Common stock (note 11):
Authorized 8,000,000,000 shares;
issued 2,147,201,551 shares in 2015 and in 2014
Capital surplus (note 11)
Legal reserve
Retained earnings
Accumulated other comprehensive
175,820
211,155
64,058
175,820
207,089
62,739
1,267,438
1,076,999
1,465,167
1,759,625
533,817
10,561,984
income (loss) (notes 3, 9, 10, 12 and 14)
124,064
1,957
1,033,866
Treasury stock, at cost
385,990 shares in 2015 and
348,999 shares in 2014
(332)
(282)
(2,767)
Total Mitsubishi Electric Corp. shareholders' equity
1,842,203
1,524,322
15,351,692
Noncontrolling interests
Total equity
87,964
76,029
1,930,167
1,600,351
733,033
16,084,725
Commitments and contingent liabilities (note 16)
Total liabilities and equity
¥4,059,451
¥3,612,966
$33,828,758
MITSUBISHI ELECTRIC CORPORATION ANNUAL REPORT 2015 37
Consolidated Statements of Income
Mitsubishi Electric Corporation and Subsidiaries
Years ended March 31, 2015, 2014 and 2013
Revenues:
Net sales (note 6)
Interest and dividends (note 6)
Equity in earnings of affiliated companies (note 6)
Other (notes 3, 12, 14 and 19)
Total revenues
Costs and expenses:
Cost of sales (notes 10 and 20)
Selling, general and administrative (notes 10, 19 and 20)
Research and development
Loss on impairment of long-lived assets (notes 18 and 19)
Interest
Equity in losses of affiliated companies (note 6)
Other (notes 3, 12, 14, 15, 16 and 19)
Total costs and expenses
2015
2014
Yen (millions)
2013
¥4,323,041
7,365
27,725
43,304
4,401,435
¥4,054,359
7,799
23,153
24,554
4,109,865
¥3,567,184
7,742
—
25,361
3,600,287
3,032,161
790,563
179,628
3,085
4,023
—
69,007
4,078,467
2,914,589
737,042
163,765
3,791
4,539
—
37,149
3,860,875
2,604,360
648,890
157,522
4,317
6,507
14,619
98,931
3,535,146
U.S. dollars
(thousands)
(note 2)
2015
$36,025,342
61,375
231,042
360,866
36,678,625
25,268,009
6,588,025
1,496,900
25,708
33,525
—
575,058
33,987,225
Income before income taxes
322,968
248,990
65,141
2,691,400
Income taxes (note 9):
Current
Deferred
60,183
14,730
74,913
34,241
51,957
86,198
23,490
(32,999)
(9,509)
501,525
122,750
624,275
Net income
248,055
162,792
74,650
2,067,125
Net income attributable to noncontrolling interests
13,361
9,319
5,133
111,342
Net income attributable to Mitsubishi Electric Corp.
¥ 234,694
¥ 153,473
¥ 69,517
$ 1,955,783
Net income per share attributable to Mitsubishi Electric Corp. (note 13):
Basic
Diluted
See accompanying notes to consolidated financial statements.
¥109.32
—
¥71.49
—
Yen
¥32.38
—
U.S. dollars
(note 2)
$0.911
—
Consolidated Statements of Comprehensive Income
Mitsubishi Electric Corporation and Subsidiaries
Years ended March 31, 2015, 2014 and 2013
Net income
Other comprehensive income (loss),
net of tax (note 12):
Foreign currency translation adjustments
Pension liability adjustments (note 10)
Unrealized gains (losses) on securities (note 3)
Unrealized gains (losses) on derivative instruments (note 14)
Total
2015
¥248,055
2014
¥162,792
Yen (millions)
2013
¥74,650
72,583
21,171
36,710
7
130,471
51,769
(6,756)
55,556
(80)
100,489
66,592
47,633
14,845
43
129,113
Comprehensive income
378,526
263,281
203,763
U.S. dollars
(thousands)
(note 2)
2015
$2,067,125
604,858
176,425
305,917
58
1,087,258
3,154,383
Comprehensive income attributable to
noncontrolling interests
Comprehensive income attributable to
Mitsubishi Electric Corp.
See accompanying notes to consolidated financial statements.
21,725
14,364
12,130
181,042
¥356,801
¥248,917
¥191,633
$2,973,341
38 MITSUBISHI ELECTRIC CORPORATION ANNUAL REPORT 2015
Consolidated Statements of Equity
Mitsubishi Electric Corporation and Subsidiaries
Years ended March 31, 2015, 2014 and 2013
Balance at March 31, 2012
Comprehensive income (loss):
Net income attributable to Mitsubishi Electric Corp.
Net income attributable to noncontrolling interests
Other comprehensive income (loss), net of tax (note 12):
Foreign currency translation adjustments
Pension liability adjustments (note 10)
Unrealized gains (losses) on securities (note 3)
Unrealized gains (losses) on derivative instruments
(note 14)
Transfer to legal reserve
Equity transactions with noncontrolling interests
and other
Dividends paid to Mitsubishi Electric Corp.
shareholders’ equity
Purchase of treasury stock
Reissuance of treasury stock
Balance at March 31, 2013
Comprehensive income (loss):
Net income attributable to Mitsubishi Electric Corp.
Net income attributable to noncontrolling interests
Other comprehensive income (loss), net of tax (note 12):
Foreign currency translation adjustments
Pension liability adjustments (note 10)
Unrealized gains (losses) on securities (note 3)
Unrealized gains (losses) on derivative instruments
(note 14)
Transfer to legal reserve
Equity transactions with noncontrolling interests
and other
Dividends paid to Mitsubishi Electric Corp.
shareholders’ equity
Purchase of treasury stock
Reissuance of treasury stock
Balance at March 31, 2014
Comprehensive income (loss):
Net income attributable to Mitsubishi Electric Corp.
Net income attributable to noncontrolling interests
Other comprehensive income (loss), net of tax (note 12):
Foreign currency translation adjustments
Pension liability adjustments (note 10)
Unrealized gains (losses) on securities (note 3)
Unrealized gains (losses) on derivative instruments
(note 14)
Transfer to legal reserve
Equity transactions with noncontrolling interests
and other
Dividends paid to Mitsubishi Electric Corp.
shareholders’ equity
Purchase of treasury stock
Reissuance of treasury stock
Balance at March 31, 2015
Balance at March 31, 2014
Comprehensive income (loss):
Net income attributable to Mitsubishi Electric Corp.
Net income attributable to noncontrolling interests
Other comprehensive income (loss), net of tax (note 12):
Foreign currency translation adjustments
Pension liability adjustments (note 10)
Unrealized gains (losses) on securities (note 3)
Unrealized gains (losses) on derivative instruments
(note 14)
Transfer to legal reserve
Equity transactions with noncontrolling interests
and other
Dividends paid to Mitsubishi Electric Corp.
shareholders’ equity
Purchase of treasury stock
Reissuance of treasury stock
Balance at March 31, 2015
Common
stock
Legal
reserve
¥175,820 ¥206,343 ¥61,040
Capital
surplus
Retained
earnings
¥905,086
69,517
Accumulated
other
comprehensive
income (loss)
¥(215,603)
Total Mitsubishi
Electric Corp.
shareholders’
equity
¥1,132,465
Non-
controlling
interests
¥58,555
Treasury
stock
¥ (221)
Yen (millions)
Total
equity
¥1,191,020
69,517
5,133
66,592
47,633
14,845
43
203,763
—
69,517
59,631
47,633
14,803
49
191,633
—
5,133
6,961
42
(6)
12,130
59,631
47,633
14,803
49
366
(366)
(398)
(398)
(3,764)
(4,162)
(23,616)
¥175,820 ¥205,945 ¥61,406 ¥ 950,621
¥ (93,487)
153,473
(16)
2
¥ (235)
(23,616)
(16)
2
¥1,300,070
153,473
46,675
(6,756)
55,591
(66)
46,675
(6,756)
55,591
(66)
248,917
—
1, 333
(1,333)
(23,616)
(16)
2
¥1,366,991
153,473
9,319
51,769
(6,756)
55,556
(80)
263,281
—
¥66,921
9,319
5,094
(35)
(14)
14,364
1.144
1,144
(5,256)
(4,112)
(25,762)
¥175,820
¥207,089
¥62,739 ¥1,076,999
¥ 1,957
234,694
64,307
21,171
36,616
13
1,319
(1,319)
(48)
1
¥ (282)
(25,762)
(48)
1
¥1,524,322
234,694
64,307
21,171
36,616
13
356,801
—
(25,762)
(48)
1
¥1,600,351
234,694
13,361
72,583
21,171
36,710
7
378,526
—
¥76,029
13,361
8,276
94
(6)
21,725
4,066
4,066
(9,790)
(5,724)
(42,936)
¥175,820
¥211,155 ¥64,058 ¥1,267,438
¥124,064
(42,936)
(50)
0
¥(332) ¥1,842,203
(50)
0
(42,936)
(50)
0
¥1,930,167
¥87,964
U.S. dollars (thousands) (note 2)
Accumulated
other
comprehensive
Legal
income (loss)
reserve
$1,465,167 $1,725,742 $522,825 $8,974,993 $ 16,308
Common
stock
Retained
earnings
Capital
surplus
Total Mitsubishi
Electric Corp.
shareholders’
equity
Non-
controlling
interests
Treasury
stock
Total
equity
$(2,350) $12,702,685 $633,574 $13,336,259
1,955,783
1,955,783
535,892
176,425
305,133
108
535,892
176,425
305,133
108
111,342
68,966
784
(50)
1,955,783
111,342
604,858
176,425
305,917
58
10,992
(10,992)
33,883
(357,800)
$1,465,167 $1,759,625 $533,817 $10,561,984 $1,033,866
2,973,341
—
181,042
3,154,383
—
33,883
(81,583)
(47,700)
(357,800)
(417)
0
$(2,767) $15,351,692 $733,033 $16,084,725
(357,800)
(417)
0
(417)
0
See accompanying notes to consolidated financial statements.
MITSUBISHI ELECTRIC CORPORATION ANNUAL REPORT 2015 39
Consolidated Statements of Cash Flows
Mitsubishi Electric Corporation and Subsidiaries
Years ended March 31, 2015, 2014 and 2013
Cash flows from operating activities:
Net income
Adjustments to reconcile net income
to net cash provided by operating activities:
Depreciation
Impairment losses of property, plant and
equipment
Loss (gain) from sales and disposal of
property, plant and equipment, net
Deferred income taxes
Loss (gain) from sales of securities and
other, net
Devaluation losses of securities and other, net
Equity in losses (earnings) of affiliated companies
Decrease (increase) in trade receivables
Decrease (increase) in inventories
Decrease (increase) in other assets
Increase (decrease) in trade payables
Increase (decrease) in accrued expenses and
retirement and severance benefits
Increase in other liabilities
Other, net
Net cash provided by operating activities
Cash flows from investing activities:
Capital expenditure
Proceeds from sale of property,
plant and equipment
Purchase of short-term investments
2015
2014
Yen (millions)
2013
U.S. dollars
(thousands)
(note 2)
2015
¥248,055
¥162,792
¥ 74,650
$2,067,125
156,205
132,956
127,942
1,301,708
2,751
3,627
4,014
22,925
(1,950)
14,730
(383)
1,148
(27,725)
(42,044)
(75,829)
(6,966)
47,948
(18,772)
60,595
20,550
378,313
67
51,957
1,108
607
(23,153)
14,812
18,141
(12,580)
83,179
(10,756)
21,494
(3,764)
440,487
(296)
(32,999)
(2,480)
4,828
14,619
(49)
16,706
(21,241)
(62,549)
(63,638)
16,787
6,458
82,752
(16,250)
122,750
(3,192)
9,567
(231,042)
(350,367)
(631,908)
(58,050)
399,567
(156,433)
504,958
171,250
3,152,608
(199,758)
(151,840)
(150,425)
(1,664,650)
6,768
4,930
4,792
56,400
and investment securities (net of cash acquired)
(5,608)
(21,312)
(13,036)
(46,733)
Proceeds from sale of short-term
investments and investment securities
Decrease (increase) in loans receivable
Other, net
Net cash used in investing activities
Cash flows from financing activities:
Proceeds from long-term debt
Repayment of long-term debt
Increase (decrease) in short-term debt, net
Dividends paid
Purchase of treasury stock
Reissuance of treasury stock
Other, net
Net cash provided by (used in)
financing activities
Effect of exchange rate changes on
cash and cash equivalents
Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of year
Cash and cash equivalents at end of year
See accompanying notes to consolidated financial statements.
40 MITSUBISHI ELECTRIC CORPORATION ANNUAL REPORT 2015
10,722
24
(10,311)
(198,163)
90,598
(103,497)
11,392
(42,936)
(50)
0
(5,130)
44,134
1,882
(8,015)
(130,221)
193
(105,445)
(73,266)
(25,762)
(48)
1
(4,694)
29,088
(14,398)
(9,722)
(153,701)
57,003
(90,786)
19,237
(23,616)
(16)
2
(2,977)
89,350
200
(85,925)
(1,651,358)
754,984
(862,475)
94,933
(357,800)
(417)
0
(42,750)
(49,623)
(209,021)
(41,153)
(413,525)
19,941
150,468
418,049
¥568,517
17,923
119,168
298,881
¥418,049
18,802
(93,300)
392,181
¥298,881
166,175
1,253,900
3,483,742
$4,737,642
Notes to Consolidated Financial Statements
Mitsubishi Electric Corporation and Subsidiaries
(1) BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(a) Description of Business
Mitsubishi Electric Corporation (the “Company”) is a multina-
tional organization which develops, manufactures, sells and
distributes a broad range of electrical and electronic equip-
ments in the fields as diverse as home appliances and space
electronics.
The Company and its subsidiaries’ principal lines of
business are: (1) Energy and Electric Systems, (2) Industrial
Automation Systems, (3) Information and Communication
Systems, (4) Electronic Devices, (5) Home Appliances and (6)
Others.
Each line’s sales as a percentage of total consolidated
sales, before elimination of internal sales, for the year ended
March 31, 2015 are as follows: Energy and Electric Systems
– 24%, Industrial Automation Systems – 26%, Information
and Communication Systems – 11%, Electronic Devices – 5%,
Home Appliances – 19% and Others – 15%.
Majority of the operations of the Company and its sub-
sidiaries is mainly conducted in Japan. Net sales for the year
ended March 31, 2015 comprises of the following geo-
graphical locations: Japan – 58%, North America – 9%, Asia
(excluding Japan) – 22%, Europe – 9% and Others – 2%.
Our manufacturing operations are conducted principally
consolidate the entity as the primary beneficiary when the
Company has a controlling financial interest.
(d) Use of Estimates
The Company makes estimates and assumptions to prepare
the consolidated financial statements in conformity with
generally accepted accounting principles, and those estimates
and assumptions affect the reported amounts of assets and
liabilities as well as the disclosed amounts of contingent assets
and liabilities at the date of the consolidated financial state-
ments and the reported amounts of revenues and expenses
during the reporting period. Significant items subject to such
estimates and assumptions include valuation allowances for
receivables, inventories and deferred tax assets; the carrying
amount of property, plant and equipment; and assets and
obligations related to employee benefits. Actual results could
differ from those estimates.
(e) Cash and Cash Equivalents
The Company considers all highly liquid debt instruments with
original maturities of three months or less to be cash equiva-
lents for the consolidated cash flow statements.
(f) Short-Term Investments and Investment Securities
The Company classifies investments in debt and equity secu-
at the Parent company with 23 manufacturing sites located in
rities into trading, available-for-sale, or held-to-maturity
Japan as well as overseas manufacturing sites located in the
securities.
United States, United Kingdom, Thailand, Malaysia, China and
Trading securities are bought and held principally for the
other countries.
(b) Basis of Presentation
The Company and its subsidiaries maintain their books of
account in conformity with financial accounting standards in
the countries of their domicile.
The Company prepares the consolidated financial state-
ments with reflecting the adjustments which are considered
necessary to conform with accounting principles generally
accepted in the United States of America.
(c) Consolidation
The Company prepares the consolidated financial statements
including the accounts of the parent company and those
of its majority-owned subsidiaries, whether directly or indi-
rectly controlled. All significant intercompany transactions,
accounts, and unrealized gains or losses have been eliminated.
Investments in corporate joint ventures and affiliated
companies with the ownership interest of 20% to 50%, in
which the Company does not have control, but has the abil-
ity to exercise significant influence, are accounted for by the
equity method of accounting. Investments of less than 20%
or on which the Company does not have significant influence
are accounted for by the cost method.
The Company evaluates Variable Interest Entities (VIEs)
whether it has a controlling financial interest in an entity
through means other than voting rights and whether it should
purpose of selling them in the near term. Held-to-maturity
securities are those securities which the Company has the
ability and intent to hold until maturity. All securities not
included in trading or held-to-maturity are classified as
available-for-sale.
Trading and available-for-sale securities are recorded at
fair value. Held-to-maturity securities are recorded at amor-
tized cost, adjusted for the amortization or accretion of pre-
miums or discounts. Unrealized holding gains and losses on
trading securities are included in earnings. Unrealized holding
gains and losses, net of the related tax effect, on available-for-
sale securities are excluded from earnings and are reported as
a separate component of other comprehensive income (loss)
until realized. Realized gains or losses from the sale of securi-
ties are determined on the average cost of the particular secu-
rity held at the time of sale.
A decline in the fair value of any available-for-sale security
below costs that is other-than-temporary results in a reduction
in carrying amount to the fair value, which becomes the new
cost basis for the security.
To determine whether an impairment of equity security
is other-than-temporary, the Company considers whether it
has the ability and intent to hold the security until a market
price recovery and considers whether evidence indicating
the market price of the security is recoverable to the carrying
MITSUBISHI ELECTRIC CORPORATION ANNUAL REPORT 2015 41
amount outweighs the counter evidence. Evidence considered
loss and tax credit carryforwards. Deferred tax assets and
in this assessment includes the reasons for the impairment,
liabilities are measured using enacted tax rates expected to
the severity and duration of the impairment, changes in value
apply to taxable income in the years in which the temporary
subsequent to year-end, and forecasted performance of the
differences are expected to be recovered or settled. The effect
investee.
on deferred tax assets and liabilities of a change in tax rates
To determine whether an impairment of debt security is
is recognized in income in the period that includes the enact-
other-than-temporary, the Company considers whether it has
ment date.
the intent to sell the debt security and it is more likely than
Valuation allowances are established to reduce deferred
not that the Company is required to sell until a market price
tax assets to their net realizable value if it is more likely than
of the investment is recoverable to the amortized cost.
not that some portion or all of the deferred tax asset will not
Other investments are stated at cost. The Company rec-
be realized.
ognizes a loss when there is other-than-temporary decline in
The Company recognizes the financial statement effects
value of other investments, using the same policy as described
of unrecognized tax benefits only if those positions are more
above for available-for-sale security impairments.
likely than not of being sustained.
(g) Allowance for Doubtful Receivables
The Company records an allowance for doubtful receivables
(l) Product Warranties
The Company generally offers warranties on its products
based on credit loss history and evaluation of specific doubtful
against certain manufacturing and other defects for the spe-
receivables.
(h) Inventories
In work-in-process, the Company records the ordered prod-
ucts at the acquisition cost and the regular purchased prod-
ucts at the average production costs. Those products are
cific periods of time and/or usage of the product depending
on the nature of the product, the geographic location of its
sale and other factors. The Company recognizes accrued war-
ranty costs based primarily on historical experience of actual
warranty claims as well as current information on repair costs.
recorded at the lower of cost or market. Net costs in excess
of billings on long-term contracts are included in inventories.
(m) Retirement and Severance Benefits
The Company recognizes the funded status (i.e., the differ-
Raw material and finished product inventories are gener-
ence between the fair value of plan assets and the projected
ally recorded using the average-cost method, and evaluated
benefit obligations) of its pension plans in the consolidated
at the lower of cost or market. In accordance with the general
balance sheet at the end of the year, and records the cor-
practice in the heavy electrical industry, inventories related to
responding amount to accumulated other comprehensive
Energy and Electric Systems include items with long manufac-
income (loss), net of tax. The adjustment items for accumulat-
turing periods which are not realizable within one year.
ed other comprehensive income (loss) are unrecognized prior
(i) Property, Plant and Equipment
The Company records property, plant and equipment at cost.
Depreciation of property, plant and equipment is generally
service cost and unrecognized net gain or loss. The amounts
of these adjustments are recognized as net periodic pension
cost in future years.
calculated by the declining-balance method, except for certain
assets which are depreciated by the straight-line method, over
(n) Revenue Recognition
The Company recognizes revenue when persuasive evidence
the estimated useful life of the assets according to general
class, type of construction, and use of these assets.
of an arrangement including title transfer exists, delivery has
occurred, the sales price is fixed or determinable, and collect-
The estimated useful life of buildings is 3 to 50 years,
ibility is probable. These criteria are met for mass-merchandis-
while machinery and equipment is 2 to 20 years.
ing products such as consumer products and semiconductors
(j) Leases
The Company records capital leases at the inception of the
lease at the lower of the discounted present value of future
minimum lease payments or the fair value of the leased
assets. The depreciation of the leased assets is calculated in
accordance with the Company’s normal depreciation policy.
(k) Income Taxes
The Company recognizes deferred tax assets and liabilities
for the future tax consequences attributable to differences
between the financial statement carrying amounts of existing
assets and liabilities and their respective tax basis, operating
at the time when the product is received by the customer,
and for products with acceptance provisions such as heavy
machinery and industrial products at the time when the prod-
uct is received by the customer and the specific criteria of the
product are demonstrated by the Company with only certain
inconsequential or perfunctory work left to be performed
by the customer. Revenue from maintenance agreements is
recognized over the contract term when the maintenance is
provided and the cost is incurred. Also, the Company applies
the percentage of completion method for long-term con-
struction contracts. The Company measures the percentage
of completion by comparing expenses recognized through
42 MITSUBISHI ELECTRIC CORPORATION ANNUAL REPORT 2015
the current year to the aggregate amount of estimated cost.
effective portion of the hedging instruments are recognized as
Any anticipated losses on fixed price contracts are charged
a component of other comprehensive income (loss) until the
to operations when such losses can be estimated. Provisions
hedged item is recognized in earnings. The ineffective portion
are made for contingencies in the period when they become
of all hedges is recognized in earnings immediately.
known pursuant to specific contract terms and conditions and
The Company discloses the use and purpose of derivative
are estimable.
instruments, accounting for derivative instruments and related
For the contract which may consists of any combination
hedged items. The Company also discloses the effects on the
of products, equipment, installation and maintenance, rev-
entity’s financial position, results of operations, and cash flows
enue is allocated to each accounting unit based on its relative
by the derivative instruments and hedging activities.
fair value, when each deliverable is accounted for by each
separate accounting unit.
(t) Securitizations
The Company accounts for the securitization of the accounts
(o) Research and Development and Advertising
The Company accounts for the costs of research and devel-
receivables as a sale, if it is determined based on the
Company’s evaluation that it has surrendered control over the
opment and advertising as expense when those costs are
transferred receivables.
incurred.
(p) Shipping and Handling Costs
The Company records shipping and handling costs mainly as
selling, general and administrative expenses.
(q) Net Income per Share
The Company calculates basic net income per share attribut-
able to Mitsubishi Electric Corp. by dividing net income attrib-
utable to Mitsubishi Electric Corp. by the weighted-average
number of common shares outstanding during each year.
Diluted net income per share attributable to Mitsubishi Electric
Corp. reflects the potential dilution and is calculated on the
basis that dilutive securities were converted at the beginning
of the year or at time of issuance (if later), and that dilutive
stock option were exercised (less the number of treasury stock
assumed to be purchased from the proceeds using the aver-
age market price of the Company’s common stock).
(r) Foreign Currency Translation
The Company translates receivables and payables in foreign
currency at the prevailing rates of exchange at the balance
sheet date. Gains and losses resulting from translation of
receivables and payables are recognized in current earnings.
Assets and liabilities of the Company’s overseas consolidated
subsidiaries are translated into Japanese yen at the prevail-
ing rates of exchange at the balance sheet date. Income and
expense items are translated at the average exchange rate
prevailing during the year. Gains and losses resulting from
translation of financial statements are recognized as foreign
currency translation adjustments in other comprehensive
income (loss).
(s) Derivatives
The Company recognizes all derivatives as either assets or lia-
bilities in the consolidated financial statements and measures
them at fair value. For derivatives designated as fair value
hedges, changes in fair value of the hedged item and the
derivative are recognized in current earnings. For derivatives
designated as cash flow hedges, fair value changes of the
Accordingly, the receivables sold under these facilities
are excluded from Trade receivables in the accompanying
consolidated balance sheets. Gain or loss on sale of receiv-
ables is calculated based on the allocated carrying amount of
the receivables sold. When a portion of accounts receivables
is transferred, the participating interest that continues to be
held is recorded at the allocated carrying amount of the assets
based on their relative fair values at the date of the transfer.
The Company estimates fair value based on the present value
of future expected cash flows less credit losses.
(u) Impairment of Long-Lived Assets
The Company reviews for impairment of long-lived assets
such as property, plant, and equipment and purchased intan-
gibles subject to amortization, to be held and used whenever
events or changes in circumstances indicate that the carrying
amount of an asset may not be recoverable. Recoverability of
assets to be held and used is measured by a comparison of
the carrying amount of an asset to estimated undiscounted
future cash flows expected to be generated by the asset. If
the carrying amount of an asset exceeds its estimated future
cash flows, an impairment loss is recognized by the amount
by which the carrying amount of the asset exceeds the fair
value of the asset. Long-lived assets to be disposed of other
than sale continue to be classified as held and used until they
are disposed.
Long-lived assets classified as held-for-sale are separately
presented in the balance sheet and reported at the lower of
the carrying amount or fair value less costs to sell, and are
no longer depreciated. The assets and liabilities of a disposed
group classified as held-for-sale are presented separately in
the appropriate asset and liability sections of the consolidated
balance sheets.
(v) Goodwill and Other Intangible Assets
The Company accounts for business combinations using the
acquisition method. The Company recognizes at fair value the
assets acquired, the liabilities assumed, any noncontrolling
interests in the acquiree, and acquired goodwill at the acquisi-
MITSUBISHI ELECTRIC CORPORATION ANNUAL REPORT 2015 43
tion date. The Company discloses the nature of business com-
reasonable estimate of fair value can be made. The associated
bination to enable the readers to evaluate the effects of such
asset retirement costs are capitalized as part of the carrying
transaction on the consolidated financial statements.
amount of the long-lived asset and subsequently allocated to
The Company does not amortize goodwill and other
expense over the asset’s useful life. Subsequent to the initial
intangible assets with indefinite useful life but tests it for
measurement of the asset retirement obligation, the obliga-
impairment at least annually. Also other intangible assets
tion is adjusted at the end of each period to reflect the pas-
determined to have useful life are amortized over their respec-
sage of time and changes in the estimated future cash flows
tive estimated useful life and tested for impairment.
underlying the obligation.
(w) Cost Associated with Exit or Disposal Activities
The Company recognizes the costs associated with exit or dis-
(z) Reclassifications
The Company has made certain reclassifications of the previ-
posal activities as liability only when it meets the definition of
ous fiscal years’ consolidated financial statements to conform
a liability in the Statements of Financial Accounting Concepts
to the presentation used for the year ended March 31, 2015.
No. 6, “Elements of Financial Statements”. The Company
uses fair value for initial measurement of liabilities related to
exit or disposal activities.
(aa) Future Application of New Accounting Standards
In May 2014, the Financial Accounting Standards Board
(FASB) issued Accounting Standards Updates (ASU) 2014-09
(x) Guarantees
The Company recognizes the guarantees and indemnifica-
“Revenue from Contracts with Customers” (A Creation of
Accounting Standards Codification (ASC) Topic 606 “Revenue
tion arrangements as liability measured at fair value as they
are issued or modified by the Company, and discloses the
from Contracts with Customers”). ASU 2014-09 requires an
entity to recognize revenue to depict the transfer of promised
guarantees that the Company has undertaken, including a
goods or services to customers in an amount that reflects
rollforward of the Company’s product warranty liabilities. The
the consideration to which the entity expects to be entitled
Company continually monitors the conditions of the guaran-
in exchange for those goods or services. The Company is
tees and indemnifications to identify occurrence of probable
required to adopt ASU 2014-09 on April 1, 2017 retrospec-
losses, and when such losses are identified and if estimable,
tively to each prior reporting period presented or retrospec-
they are recognized in current earnings.
tively with the cumulative effect of initially adopting this
(y) Asset Retirement Obligations
The Company recognizes legal obligations associated with the
retirement of long-lived assets that result from an acquisition,
construction and development, and (or) from a normal opera-
tion of a long-lived asset, except for certain lease obligations.
The Company recognizes a liability for an asset retirement
obligation at fair value in the period which it is incurred if a
update recognized at the date of the initial adoption. In April
2015, FASB issued proposed ASU “Revenue from Contracts
with Customers-Deferral of the Effective Date” which defers
an adoption date of ASU2014-09 for one year. The Company
has not yet determined which method it will apply and is cur-
rently evaluating the effects on the Company’s consolidated
financial position and results of operations upon adoption of
ASU 2014-09.
(2) U.S. DOLLAR AMOUNTS
The Company has presented the consolidated financial state-
exchange rate prevailing on the Tokyo Foreign Exchange
ments in Japanese yen, and solely for the convenience of the
Market at the end of March 2015. This translation should not
reader, has provided translated amounts in United States dol-
be construed as a representation that the amounts shown
lars at the rate of ¥120=U.S.$1, which was the approximate
could be converted into United States dollars at such rate.
44 MITSUBISHI ELECTRIC CORPORATION ANNUAL REPORT 2015
(3) SECURITIES
Marketable securities included in short-term investments and
unrealized holding losses and fair value for such securities by
investments in securities and other consist of available-for-
equity securities and debt securities at March 31, 2015 and
sale securities. The cost, gross unrealized holding gains, gross
2014 were as follows:
2015:
Available-for-sale:
Equity securities
Debt securities
2014:
Available-for-sale:
Equity securities
Debt securities
2015:
Available-for-sale:
Equity securities
Debt securities
Gross
unrealized
holding
gains
Gross
unrealized
holding
losses
Cost
Yen (millions)
Fair value
¥96,210
500
¥96,710
¥176,013
21
¥176,034
¥780
2
¥782
¥271,443
519
¥271,962
Gross
unrealized
holding
gains
Gross
unrealized
holding
losses
Cost
Yen (millions)
Fair value
¥ 96,587
3,861
¥100,448
¥127,931
—
¥127,931
¥1,345
49
¥1,394
¥223,173
3,812
¥226,985
Gross
unrealized
holding
gains
Gross
unrealized
holding
losses
Cost
Fair value
U.S. dollars (thousands)
$801,750
4,167
$1,466,775
175
$805,917
$1,466,950
$6,500
17
$6,517
$2,262,025
4,325
$2,266,350
Debt securities consist of Japanese government debt securi-
($305,133 thousand), ¥55,591 million and ¥14,803 million,
ties, corporate debt securities and others.
respectively.
In the years ended March 31, 2015, 2014 and 2013, net
As of March 31, 2015 and 2014, the cost of non-market-
unrealized gains on available-for-sale securities, net of taxes
able equity securities were ¥14,545 million ($121,208 thou-
and noncontrolling interests, increased by ¥36,616million
sand) and ¥14,550 million, respectively.
Maturities of marketable securities classified as available-for-sale at March 31, 2015 were as follows:
Due after one year through five years
Due after five years
Marketable equity securities
Cost
¥ 200
300
96,210
¥96,710
Yen (millions)
Fair value
¥ 198
321
271,443
¥271,962
U.S. dollars
(thousands)
Fair value
$ 1,650
2,675
2,262,025
$2,266,350
Cost
$ 1,667
2,500
801,750
$805,917
MITSUBISHI ELECTRIC CORPORATION ANNUAL REPORT 2015 45
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 positions, at March 31, 2015 were as follows:
Available-for-sale:
Equity securities
Debt securities
Available-for-sale:
Equity securities
Debt securities
Less than 12 months
Fair
value
Unrealized
losses
12 months or more
Fair
value
Unrealized
losses
Yen (millions)
Total
Fair
value
Unrealized
losses
¥528
198
¥726
¥139
2
¥141
¥444
—
¥444
¥641
—
¥641
¥ 972
198
¥1,170
¥780
2
¥782
Less than 12 months
Fair
value
Unrealized
losses
12 months or more
Fair
value
Unrealized
losses
U.S. dollars (thousands)
Total
Fair
value
Unrealized
losses
$4,400
1,650
$6,050
$1,158
17
$1,175
$3,700
—
$3,700
$5,342
—
$5,342
$8,100
1,650
$9,750
$6,500
17
$6,517
The Company did not recognize an impairment loss from the decline in the fair value of the marketable securities including the
unrealized losses. Based on that evaluation and the Company’s ability and intent to hold those securities for a reasonable period
of time sufficient for a recovery of fair value, the Company does not consider those securities to be other-than-temporarily
impaired.
Proceeds from the sale of available-for-sale securities and gross realized gains and losses on those sales in the years ended
March 31, 2015, 2014 and 2013 were as follows:
Proceeds
Gross realized gains
Gross realized losses
2015
¥3,034
111
74
2014
¥26,964
161
1,327
Yen (millions)
2013
¥22,287
2,527
47
U.S. dollars
(thousands)
2015
$25,283
925
617
For the years ended March 31, 2015 and 2014, the Company did not recognize any material losses on impairment of marketable
securities due to other-than-temporary declines in fair value.
For the year ended March 31, 2013, the Company recognized loss on impairment of marketable securities of ¥3,860 million,
due to other-than-temporary declines in fair value.
(4) TRADE RECEIVABLES
Trade receivables are summarized as follows:
Notes receivable
Accounts receivable
Allowance for doubtful receivables
2015
¥ 81,995
977,044
(10,497)
¥1,048,542
Yen (millions)
2014
¥ 68,335
925,181
(10,048)
¥983,468
U.S. dollars
(thousands)
2015
$ 683,292
8,142,033
(87,475)
$8,737,850
46 MITSUBISHI ELECTRIC CORPORATION ANNUAL REPORT 2015
(5) INVENTORIES
Inventories are comprised of the following:
Work in process
Less accumulated billings on long-term contracts
Raw materials
Finished products
2015
¥297,976
19,182
278,794
116,027
310,599
Yen (millions)
2014
¥262,466
14,955
247,511
100,150
254,680
¥705,420
¥602,341
U.S. dollars
(thousands)
2015
$2,483,133
159,850
2,323,283
966,892
2,588,325
$5,878,500
(6) INVESTMENTS IN AFFILIATED COMPANIES
A summary of the combined financial information relating to affiliated companies accounted for by the equity method of
accounting (Toshiba Mitsubishi-Electric Industrial Systems Corporation, Shanghai Mitsubishi Elevator Co., Ltd, etc.) as of March
31, 2015 and 2014, and for the years ended March 31, 2015, 2014 and 2013 is as follows:
Results of Operations for the years ended March 31, 2014 and 2013 include the financial information of Renesas Electric
Corporation (Renesas) which was excluded from affiliated companies accounted for by the equity method of accounting on
September 30, 2013.
Financial Position
Current assets
Property, plant and equipment
Other assets
Total assets
Current liabilities
Long-term debt
Total liabilities
Shareholders’ equity
2015
¥1,363,332
114,754
115,663
¥1,593,749
¥ 933,014
139,057
1,072,071
521,678
Yen (millions)
2014
U.S. dollars
(thousands)
2015
¥1,240,376
109,668
105,591
¥1,455,635
¥ 830,046
133,766
963,812
491,823
$11,361,101
956,283
963,858
$13,281,242
$ 7,775,117
1,158,808
8,933,925
4,347,317
Total liabilities and shareholders’ equity
¥1,593,749
¥1,455,635
$13,281,242
Results of Operations
Sales
Net income (loss) attributable to affiliated companies
¥1,255,026
70,429
¥1,648,617
54,383
¥1,869,079
(84,953)
$10,458,550
586,908
2015
2014
Yen (millions)
2013
U.S. dollars
(thousands)
2015
MITSUBISHI ELECTRIC CORPORATION ANNUAL REPORT 2015 47
The balances and transactions with affiliated companies accounted for by the equity method of accounting as of March 31, 2015
and 2014, and for the years ended March 31, 2015, 2014 and 2013 are as follows:
The transactions for the years ended March 31, 2014 and 2013 include those with Renesas.
Trade receivables
Trade payables
Sales
Purchases
Dividends
2015
¥ 69,997
154,915
2015
¥307,841
143,904
16,886
2014
¥313,119
173,897
12,418
Yen (millions)
2014
¥ 71,578
149,964
Yen (millions)
2013
¥298,033
166,633
10,174
U.S. dollars
(thousands)
2015
$ 583,308
1,290,958
U.S. dollars
(thousands)
2015
$2,565,342
1,199,200
140,717
Investments in affiliated companies accounted for by the equity method of accounting include the shares of 9 publicly quoted
affiliates, which are summarized as follows:
Investments at equity
Quoted market value
(7) BANK LOANS AND LONG-TERM DEBT
Bank loans consisted of the following:
Borrowings from banks and others
2015
¥41,121
55,640
Yen (millions)
2014
¥35,378
45,595
2015
¥72,385
Yen (millions)
2014
¥60,275
U.S. dollars
(thousands)
2015
$342,675
463,667
U.S. dollars
(thousands)
2015
$603,208
The weighted average interest rates on borrowings from
unused committed lines of credit that can provide short-term
banks and others outstanding as of March 31, 2015 and 2014
funds from subscribing financial institutions amounting to
were 0.83% and0.51%, respectively.
¥81,500 million ($679,167 thousand).
At March 31, 2015, the Company and its subsidiaries had
48 MITSUBISHI ELECTRIC CORPORATION ANNUAL REPORT 2015
2015
Yen (millions)
2014
U.S. dollars
(thousands)
2015
Long-term debt consisted of the following:
Borrowings from banks and other companies,
due2015 to 2022 with bearing interest rate
ranging from 0.15% to 5.42% at March 31, 2015:
due2014 to 2022 with bearing interest rate
ranging from 0.29% to 3.20% at March 31, 2014:
Secured
Unsecured
1.17% Japanese yen bonds due 2014
0.27% Japanese yen bonds due 2019
0.43% Japanese yen bonds due 2021
Capital lease obligations
Less amount due within one year
¥ —
245,765
—
20,000
20,000
23,844
309,609
92,017
¥217,592
¥ 403
256,877
30,000
—
—
25,923
313,203
101,777
¥211,426
$ —
2,048,042
—
166,666
166,666
198,700
2,580,074
766,808
$1,813,266
U.S. dollars
(thousands)
$ 766,808
427,150
330,466
511,342
254,708
289,600
$2,580,074
The aggregate annual maturities of long-term debt outstanding at March 31,2015 were as follows:
Year ending March 31:
2016
2017
2018
2019
2020
Thereafter
Total
Yen (millions)
¥ 92,017
51,258
39,656
61,361
30,565
34,752
¥309,609
Substantially all of the loans with banks and others have basic
banks’ requests and that any collateral furnished pursuant to
written agreements. With respect to all present or future
such agreements will be used against repayment of debts in
loans, these agreements state that the Company would need
case of default.
to provide collateral or guarantors immediately upon the
(8) TRADE PAYABLES
Trade payables are summarized as follows:
Notes payable
Accounts payable
2015
¥ 14,141
793,148
¥807,289
Yen (millions)
2014
¥ 15,029
743,884
¥758,913
U.S. dollars
(thousands)
2015
$ 117,842
6,609,566
$6,727,408
MITSUBISHI ELECTRIC CORPORATION ANNUAL REPORT 2015 49
(9) INCOME TAXES
Total income taxes were allocated as follows:
Income before income taxes
Shareholders’ equity—accumulated other
comprehensive income (loss):
Foreign currency translation adjustments
Pension liability adjustments
Unrealized gains (losses) on securities
Unrealized gains (losses) on derivative instruments
2015
¥ 74,913
2014
¥ 86,198
Yen (millions)
2013
¥ (9,509)
9,096
12,595
14,316
7
4,280
(2,151)
30,818
(24)
5,037
26,637
7,230
38
¥110,927
¥119,121
¥29,433
The significant components of deferred tax expense attributable to income taxes are as follows:
Change in valuation allowance related
to deferred tax assets
Other
2015
2014
Yen (millions)
2013
¥(14,531)
29,261
¥ 14,730
¥ (4,129)
56,086
¥51,957
¥(40,029)
7,030
¥(32,999)
U.S. dollars
(thousands)
2015
$624,275
75,800
104,958
119,300
59
$924,392
U.S. dollars
(thousands)
2015
$(121,092)
243,842
$ 122,750
The Company is subjected to a number of income taxes. The
or after April 1, 2015. Before the adjustment, the statutory
statutory tax rate is approximately 35.5% for the year ended
tax rate applied was approximately 35.5% for temporary dif-
March 31, 2015, approximately 38% for the years ended
ferences expected to be recovered or settled on or after April
March 31, 2014 and 2013.
1, 2015. After the adjustment, the statutory tax rates applied
The “Act to Partially Revise the Local Tax Act” (Act No.
are approximately 33.0% for temporary differences expected
2 of 2015) and the “Act to Partially Revise the Income Tax
to be recovered or settled between April 1, 2015 and March
Act” (Act No. 9 of 2015) were enacted and promulgated in
31, 2016 and approximately 32.0% for temporary differences
March 2015 in Japan, resulting in a reduction of the corpora-
expected to be recovered or settled on or after April 1, 2016.
tion tax rate effective for fiscal years beginning on or after
For the year ended March 31, 2015, ¥14,697 million
April 1, 2015. As a result, the Company and domestic sub-
($122,475 thousand) of income tax expense is included in
sidiaries adjusted the statutory tax rates to be applied in the
“Income taxes – Deferred” in the Consolidated Statements
calculation of deferred tax assets and liabilities arising from
of Income, as a result of the aforementioned adjustment of
temporary differences expected to be recovered or settled on
deferred tax assets and liabilities balances.
The effective tax rate for the years ended March 31,2015, 2014 and 2013 is reconciled with the Japanese statutory tax rate in
the following table:
Japanese statutory tax rate
Change in valuation allowance
Adjustment for unrealized profit on intercompany transactions
Expenses permanently not deductible for tax purposes
International tax rate difference
Tax credits
Tax effect attributable to investments at equity
Effect of income tax rate change
Other
Effective tax rate
2015
35.5%
(1.6)
(4.3)
0.5
(7.3)
(4.1)
(0.6)
4.6
0.5
23.2%
2014
38.0%
(1.9)
2.4
4.2
(8.4)
(0.1)
(2.1)
3.2
(0.7)
34.6%
2013
38.0%
(60.1)
21.4
2.8
(17.9)
(0.3)
(10.4)
7.6
4.3
(14.6)%
50 MITSUBISHI ELECTRIC CORPORATION ANNUAL REPORT 2015
For the year ended March 31, 2013, because it was expected
more likely than not that the temporary differences related to
that certain investments in affiliated companies would no
its investment in affiliated companies would be realized. The
longer be accounted for by the equity method of accounting
effects were included in Change in valuation allowance.
during the following year, the Company concluded that it was
The tax effects of temporary differences that give rise to significant portions of the deferred tax assets and deferred tax liabilities
at March 31, 2015 and 2014 are as follows:
Deferred tax assets:
Retirement and severance benefits
Accrued expenses
Property, plant and equipment
Inventories
Pension liability adjustments
Tax loss carryforwards
Other
Total gross deferred tax assets
Valuation allowance
Deferred tax assets, less valuation allowance
Deferred tax liabilities:
Securities contributed to employee
retirement benefit trust
Property, plant and equipment
Net unrealized gains on securities
Other
Total gross deferred tax liabilities
Net deferred tax assets
2015
¥ 41,966
82,973
30,699
39,260
62,436
12,738
89,508
359,580
(50,016)
309,564
27,407
5,900
32,315
61,873
127,495
¥182,069
Yen (millions)
2014
U.S. dollars
(thousands)
2015
¥ 60,624
88,148
32,566
21,779
81,317
35,506
78,569
398,509
(64,547)
333,962
30,404
10,252
25,385
39,298
105,339
¥228,623
$ 349,716
691,442
255,825
327,167
520,300
106,150
745,900
2,996,500
(416,800)
2,579,700
228,391
49,167
269,292
515,608
1,062,458
$1,517,242
The valuation allowance for deferred tax assets as of April
scheduled reversal of deferred tax liabilities, projected future
1, 2013 was ¥68,676 million. The net change in the total
taxable income, and tax planning strategies in making this
valuation allowance for the years ended March 31, 2015 and
assessment.
2014 was a decrease of ¥14,531 million ($121,092 thousand)
At March 31, 2015, the Company and certain subsidiar-
and ¥4,129 million, respectively. In assessing the realizability
ies had net operating loss carryforwards of ¥30,980 million
of deferred tax assets, management considers whether it is
($258,167 thousand) and ¥70,670 million ($588,917 thou-
more likely than not that some portion or all of the deferred
sand) for corporate and local income tax purposes, respective-
tax assets will be realized. The ultimate realization of deferred
ly, which were available to offset future taxable income, if any.
tax assets is dependent upon the generation of future tax-
A significant portion of the net operating loss carryforwards
able income during the periods in which those temporary
will expire in the years ending March 31, 2019 and 2023.
differences become deductible. Management considers the
Net deferred tax assets and liabilities at March 31, 2015 and 2014 are reflected in the accompanying consolidated balance sheets
under the following captions:
Prepaid expenses and other current assets
Other assets
Other liabilities
2015
¥135,994
51,593
(5,518)
¥182,069
Yen (millions)
2014
¥120,413
113,773
(5,563)
¥228,623
U.S. dollars
(thousands)
2015
$1,133,283
429,942
(45,983)
$1,517,242
MITSUBISHI ELECTRIC CORPORATION ANNUAL REPORT 2015 51
Deferred tax liabilities have been recognized for the undis-
Consolidated Statements of Income. Both interest and pen-
tributed earnings of subsidiaries and affiliated companies.
alties accrued as of March 31, 2015 and 2014, and interest
Deferred tax liabilities have not been recognized for undis-
and penalties for the years ended March 31, 2015, 2014 and
tributed earnings of some domestic subsidiaries and affiliated
2013 are not material.
companies as such earnings, if distributed in the form of divi-
The Company and its subsidiaries file income tax returns
dends, are either not taxable under present circumstances or
in Japan and various foreign tax jurisdictions. The tax years
are not material.
that remain subject to examination by major tax jurisdictions
Although the Company believes that there are no sig-
are as follows:
nificant unrecognized tax benefits as of March 31, 2015 and
2014, future determination by tax authorities could affect the
effective tax rate in the future periods.
The Company records interest and penalties relat-
ed to additional income tax, etc. in Income Taxes in the
Location
Japan
United States
Thailand
Europe
(10) RETIREMENT AND SEVERANCE BENEFITS
Open tax years
2008-2015
2011-2015
2010-2015
2010-2015
The Company has non-contributory and contributory defined
2005, and established a defined contribution plan on April
benefit plans covering substantially all of its employees who
1, 2005. In addition, the Company amended its contributory
meet eligibility requirements.
Under the non-contributory plans, employees with less
defined benefit plan and introduced a cash balance pension
plan. Under the cash balance pension plan, each participant
than twenty years of service are entitled to lump-sum sever-
has a notional account which is credited yearly based on the
ance indemnities at date of severance, and employees with
current rate of contribution and market-related interest rate.
twenty or more years of service are entitled to annuity pay-
The domestic consolidated subsidiaries sponsor various
ments subsequent to retirement, determined by the current
pension plans, which are partially or entirely employees’ pen-
basic rate of pay, length of service and termination condi-
sion fund plan, and/or corporate pension fund plan, based on
tions. In addition, certain employees who meet the eligibility
each subsidiary’s respective pension policies.
requirements are entitled to additional lump-sum payments
In addition, the foreign consolidated subsidiaries that
at the date of retirement based on the retirement age. Under
have adopted pension policy mainly sponsor defined contribu-
the contributory plans, employees are entitled to annuity
tion pension plan.
payments at a certain age. The assets of certain of the non-
The Company measures the fair value of plan assets and
contributory plans and the contributory plans are combined in
the projected benefit obligation at the end of the year, and
accordance with the regulations and administered by a board
recognizes the funded status (i.e., the difference between the
of trustees comprised equally of employer and employee
fair value of plan assets and the projected benefit obligations)
representatives. An employee retirement benefit trust is estab-
of pension in consolidated balance sheets with the amount of
lished for certain of the non-contributory plans.
corresponding adjustment to Accumulated other comprehen-
The Company amended its benefit plan under labor and
sive income (loss), net of tax.
management agreement during the year ended March 31,
52 MITSUBISHI ELECTRIC CORPORATION ANNUAL REPORT 2015
Obligations and funded status
Reconciliations of beginning and ending balances of the benefit obligations and the fair value of the plan assets are as follows:
Change in benefit obligations:
Benefit obligations at beginning of year
Service cost
Interest cost
Plan participants’ contributions
Amendments
Actuarial loss
Benefits paid
Acquisitions and divestitures, etc.
Benefit obligations at end of year
Change in plan assets:
Fair value of plan assets at beginning of year
Actual return on plan assets
Employer contributions
Plan participants’ contributions
Benefits paid
Acquisitions and divestitures, etc.
Fair value of plan assets at end of year
2015
¥1,067,140
30,284
15,205
1,047
—
73,625
(68,263)
95
1,119,133
857,933
113,876
47,513
1,047
(34,029)
174
986,514
Yen (millions)
2014
U.S. dollars
(thousands)
2015
¥1,038,169
29,486
19,123
1,063
339
50,408
(74,167)
2,719
1,067,140
784,686
56,929
48,280
1,063
(35,477)
2,452
857,933
$ 8,892,833
252,367
126,708
8,725
—
613,542
(568,858)
791
9,326,108
7,149,441
948,967
395,942
8,725
(283,575)
1,450
8,220,950
Funded status at end of year
¥ (132,619)
¥ (209,207)
$(1,105,158)
Amounts recognized in the consolidated balance sheets at March 31, 2015 and 2014 consist of:
Investments in securities and other
Other current liabilities
Retirement and severance benefits
2015
¥ 53,691
(4,028)
(182,282)
¥(132,619)
Yen (millions)
2014
¥ 7,651
(4,220)
(212,638)
¥(209,207)
Amounts recognized in accumulated other comprehensive income (loss) at March 31, 2015 and 2014 consist of:
Actuarial gain or loss
Prior service cost
2015
¥240,293
(42,837)
¥197,456
Yen (millions)
2014
¥286,221
(54,959)
¥231,262
The accumulated benefit obligations for all defined benefit plans were as follows:
Accumulated benefit obligations
2015
¥1,093,819
Yen (millions)
2014
¥1,050,423
U.S. dollars
(thousands)
2015
$ 447,425
(33,566)
(1,519,017)
$(1,105,158)
U.S. dollars
(thousands)
2015
$2,002,442
(356,975)
$1,645,467
U.S. dollars
(thousands)
2015
$9,115,158
MITSUBISHI ELECTRIC CORPORATION ANNUAL REPORT 2015 53
Components of net periodic retirement and severance costs and other amounts recognized in other comprehensive
income (loss)
Net periodic retirement and severance costs for the years ended March 31, 2015, 2014 and 2013 consisted of the following
components:
Service cost
Interest cost on projected benefit obligation
Expected return on plan assets
Amortization of prior service cost
Amortization of actuarial loss
Plan participants’ contributions
2015
¥ 31,331
15,205
(15,123)
(12,122)
20,721
40,012
(1,047)
2014
¥ 30,549
19,123
(13,911)
(22,216)
21,544
35,089
(1,063)
Yen (millions)
2013
¥ 30,510
21,562
(13,556)
(21,748)
27,253
44,021
(1,077)
Net periodic retirement and severance costs
¥ 38,965
¥ 34,026
¥ 42,944
U.S. dollars
(thousands)
2015
$ 261,092
126,708
(126,025)
(101,017)
172,675
333,433
(8,725)
$ 324,708
Other changes in plan assets and projected benefit obligations recognized in other comprehensive income (loss) for the years
ended March 31, 2015 and 2014 were summarized as follows:
Actuarial gain or loss
Amortization of actuarial loss (gain)
Prior service cost
Amortization of prior service cost
2015
¥(25,207)
(20,721)
—
12,122
¥(33,806)
Yen (millions)
2014
¥ 7,674
(21,544)
339
22,216
¥ 8,685
U.S. dollars
(thousands)
2015
$ 210,059
(172,675)
—
101,017
$(281,717)
The estimated actuarial gain or loss and prior service cost for the defined benefit pension plans that will be amortized from accu-
mulated other comprehensive income (loss) into net periodic benefit cost over the next year are summarized as follows:
Actuarial gain or loss
Prior service cost
Yen (millions)
¥ 13,146
(11,571)
U.S. dollars
(thousands)
$109,550
(96,425)
Actuarial assumptions
Actuarial assumptions used to determine benefit obligations at March 31, 2015 and 2014 were as follows:
Discount rate
Assumed rate of increase in future compensation levels
2015
1.0%
1.7%
2014
1.5%
1.7%
Actuarial assumptions used to determine net periodic retirement and severance costs for the years ended March 31, 2015, 2014
and 2013 were as follows:
Discount rate
Assumed rate of increase in future compensation levels
Expected long-term rate of return on plan assets
2015
1.5%
1.7%
2.5%
2014
2.0%
1.7%
2.5%
2013
2.0%
1.7%
2.5%
The expected long-term rate of return is based on actual historical returns and the expectations for future returns of each plan
asset category in which the Company invests.
54 MITSUBISHI ELECTRIC CORPORATION ANNUAL REPORT 2015
Plan Assets
The fair values of the Company’s pension plan assets at March 31, 2015 and 2014 were as follows:
Equity securities
Marketable equity securities
Pooled funds
Debt securities
Government, municipal and corporate debt securities
Pooled funds
Other assets
Life insurance company general accounts
Other
Total plan assets
2015
Yen (millions)
Level 1
Level 2
Level 3
Total
¥228,741
—
¥ —
188,634
¥ —
—
¥228,741
188,634
4,864
—
18,862
354,320
—
—
23,726
354,320
—
—
95,127
60,525
—
35,441
95,127
95,966
¥233,605
¥717,468
¥35,441
¥986,514
Notes: 1. Marketable equity securities include mainly domestic stocks.
2. Pooled funds of equity securities include approximately 20% domestic stocks and 80% foreign stocks.
3. Pooled funds of debt securities include approximately 70% domestic bonds and 30% foreign bonds.
4. Government, municipal and corporate debt securities of level 1 include government debt securities.
Equity securities
Marketable equity securities
Pooled funds
Debt securities
Government, municipal and corporate debt securities
Pooled funds
Other assets
Life insurance company general accounts
Other
Total plan assets
2014
Yen (millions)
Level 1
Level 2
Level 3
Total
¥178,946
—
¥ —
179,921
¥ —
—
¥178,946
179,921
5,111
—
21,727
322,495
—
—
26,838
322,495
—
—
91,567
42,604
—
15,562
91,567
58,166
¥184,057
¥658,314
¥15,562
¥857,933
Notes: 1. Marketable equity securities include mainly domestic stocks.
2. Pooled funds of equity securities include approximately 20% domestic stocks and 80% foreign stocks.
3. Pooled funds of debt securities include approximately 70% domestic bonds and 30% foreign bonds.
4. Government, municipal and corporate debt securities of level 1 include government debt securities.
Equity securities
Marketable equity securities
Pooled funds
Debt securities
Government, municipal and corporate debt securities
Pooled funds
Other assets
Life insurance company general accounts
Other
Total plan assets
U.S. dollars (thousands)
2015
Level 1
Level 2
Level 3
Total
$1,906,175
—
$ —
1,571,950
$ — $1,906,175
1,571,950
—
40,533
—
157,183
2,952,667
—
—
197,716
2,952,667
—
—
792,725
504,375
—
295,342
792,725
799,717
$1,946,708
$5,978,900
$295,342
$8,220,950
MITSUBISHI ELECTRIC CORPORATION ANNUAL REPORT 2015 55
The Company’s investment policies are designed to ensure
tents of investment, and appropriately diversified investments.
adequate plan assets are available to provide future pay-
See note 18 which shows categorized input for fair value
ments of pension benefits to eligible participants. Taking into
measurements by the valuation technique into a three-level
account the expected long-term rate of return on plan assets,
hierarchy.
the Company formulates an investment portfolio comprised
Each level into which assets are categorized is based on
of the optimal combination of equity and debt securities.
inputs used to measure the fair value of the assets.
Plan assets are invested in individual equity and debt securi-
Level 1 assets are comprised principally of equity securi-
ties using the guidelines of the investment portfolio in order
ties and government bonds, which are valued using unad-
to produce a total return that will match the expected return
justed quoted market prices in active markets with sufficient
on a mid-term to long-term basis. The Company evaluates the
volume and frequency of transactions. Level 2 assets are
gap between expected return and actual return of invested
comprised principally of pooled funds that invest in equity
plan assets on an annual basis. In addition, taking into the
and debt securities, corporate bonds and investments in life
consideration the management environment and the revision
insurance company general accounts. Pooled funds are valued
of regulations, the Company revises the investment portfolio
at their net asset values that are calculated by the sponsor of
when and to the extent considered necessary to achieve the
the fund. Corporate bonds are valued using quoted prices for
expected long-term rate of return on plan assets based on the
identical assets in markets that are not active. Investments in
pension asset and liability management method.
life insurance company general accounts are valued at the
The Company’s investment portfolio consists of three
amounts that are the conventional interest adding to the
major components. The Company’s target asset allocation
percentage is that approximately 25% is invested in equity
principle amounts calculated by life insurance company. Level
3 assets comprise hedge funds, which are valued based on
securities, approximately 65% is invested in debt securities
unobservable inputs.
and investments in life insurance company general accounts,
An analysis of the changes in Level 3 assets which com-
and approximately 10% is invested in hedge funds. As for
prise hedge funds measured at fair value for the years ended
selection of plan assets, the Company has examined the con-
March 31, 2015 and 2014 is as follows:
Balance at beginning of year
Actual return:
Relating to assets sold
Relating to assets still held
Purchases, sales and settlements
Transfers in and/or out of Level 3
Balance at end of year
2015
¥15,562
—
379
19,500
—
Yen (millions)
2014
¥15,138
(8)
432
—
—
¥35,441
¥15,562
U.S. dollars
(thousands)
2015
$129,684
—
3,158
162,500
—
$295,342
Cash Flows
The Company expects to contribute ¥48,928 million ($407,733 thousand) to its pension plan in the year ending March 31, 2016.
Estimated future benefit payments are as follows:
Year ending March 31:
2016
2017
2018
2019
2020
2021-2025
Yen (millions)
¥ 69,840
63,592
58,372
58,902
56,729
267,228
U.S. dollars
(thousands)
$ 582,000
529,933
486,433
490,850
472,742
2,226,900
The amount of cost recognized for the Company and certain subsidiaries’ defined contribution plans for the years ended March
31, 2015, 2014 and 2013 were ¥9,469million ($78,908 thousand), ¥8,423 million and ¥7,447 million, respectively.
56 MITSUBISHI ELECTRIC CORPORATION ANNUAL REPORT 2015
(11) SHAREHOLDERS’ EQUITY
Changes in common stock for the years ended March 31, 2015 and 2014 were as follows:
Number of common shares issued:
Balance at beginning of year
Balance at end of year
2015
2014
Shares
2,147,201,551
2,147,201,551
2,147,201,551
2,147,201,551
Conversions into common stock of convertible debenture
Corporate Law is based on the amount recorded in the
issued subsequent to October 1, 1982 and exercise of war-
Company’s books of account in accordance with accounting
rants were accounted for in accordance with the provisions of
standards of Japan. The adjustments included in the accom-
the Japanese Commercial Code by crediting one-half of the
panying consolidated financial statements to have them
conversion price and exercise price to each of the common
conform with accounting principles generally accepted in
stock account and the capital surplus account.
the United States of America, but not recorded in the books
The Japanese Corporate Law enforced on May 1, 2006
of account, have no effect on the determination of retained
requires that an amount equal to 10% of dividends and other
earnings available for dividends under the Japanese Corporate
distributions paid in cash by the Company and its domes-
Law. Retained earnings available for dividends shown in the
tic subsidiaries be appropriated as a legal reserve until the
Company’s books of account amounted to ¥383,927 million
aggregated amount of additional paid-in capital and the legal
reserve equal to 25% of the common stocks. The additional
($3,199,392 thousand) at March 31, 2015.
Cash dividends and appropriations to the legal reserve
paid-in capital and the legal reserve may be used to reduce
charged to retained earnings during the years ended March
a deficit or transferred to common stock with a resolution of
31, 2015, 2014 and 2013 represent dividends paid out during
the shareholders’ meeting.
the years and the related appropriations to the legal reserve.
The amount available for dividends under the Japanese
(12) OTHER COMPREHENSIVE INCOME (LOSS)
Changes in accumulated other comprehensive income (loss) for the years ended March 31, 2015, 2014 and 2013 are as follows:
Yen (millions)
Foreign currency
translation
adjustments
Pension liability
adjustments
2015
Unrealized gains
(losses) on
securities
Balance at beginning of year
¥ 38,652
¥(119,279)
¥ 82,636
Other comprehensive income before
reclassifications
Amounts reclassified from
accumulated other comprehensive
income
Net change during the year
Balance at end of year
65,788
15,625
36,452
(1,481)
5,546
164
64,307
¥102,959
21,171
¥ (98,108)
36,616
¥119,252
Foreign currency
translation
adjustments
Pension liability
adjustments
2014
Unrealized gains
(losses) on
securities
Balance at beginning of year
¥ (8,023)
¥(112,523)
¥27,045
Other comprehensive income before
reclassifications
Amounts reclassified from
accumulated other comprehensive
income
Net change during the year
Balance at end of year
46,675
(6,323)
54,831
—
(433)
760
46,675
¥38,652
(6,756)
¥(119,279)
55,591
¥82,636
Unrealized gains
(losses) on
derivative
instruments
¥(52)
22
(9)
13
¥(39)
Unrealized gains
(losses) on
derivative
instruments
¥ 14
(98)
32
(66)
¥(52)
Total
¥ 1,957
117,887
4,220
122,107
¥124,064
Yen (millions)
Total
¥(93,487)
95,085
359
95,444
¥ 1,957
MITSUBISHI ELECTRIC CORPORATION ANNUAL REPORT 2015 57
Balance at beginning of year
Net change during the year
Balance at end of year
Foreign currency
translation
adjustments
¥(67,654)
59,631
¥ (8,023)
Pension liability
adjustments
¥(160,156)
47,633
¥(112,523)
Foreign currency
translation
adjustments
Pension liability
adjustments
2013
Unrealized gains
(losses) on
securities
¥12,242
14,803
¥27,045
2015
Unrealized gains
(losses) on
securities
Balance at beginning of year
$322,100
$(993,992)
$688,633
Unrealized gains
(losses) on
derivative
instruments
¥(35)
49
¥ 14
Yen (millions)
Total
¥(215,603)
122,116
¥ (93,487)
U.S. dollars (thousands)
Unrealized gains
(losses) on
derivative
instruments
$(433)
Total
$ 16,308
Other comprehensive income before
reclassifications
Amounts reclassified from
accumulated other comprehensive
income
Net change during the year
Balance at end of year
548,234
130,208
303,766
183
982,391
(12,342)
46,217
1,367
(75)
35,167
535,892
$857,992
176,425
$(817,567)
305,133
$993,766
108
$(325)
1,017,558
$1,033,866
Reclassifications out of accumulated other comprehensive income (loss) for the years ended March 31, 2015 and 2014 are as follows:
Details about Accumulated other
comprehensive income components
Foreign currency translation adjustments
Pension liability adjustments
Amortization of prior service cost
Amortization of actuarial loss
Unrealized gains (losses) on securities
Realized losses on sales
Other
Unrealized gains (losses) on derivative
instruments
2015
Amounts reclassified from accumulated other
comprehensive income
Yen
(millions)
U.S. dollars
(thousands)
Affected line items in consolidated
statements of income
¥ (1,481)
(1,481)
—
(1,481)
(12,122)
20,721
8,599
(3,053)
5,546
(37)
189
152
12
164
(15)
(15)
6
(9)
$ (12,342)
(12,342)
—
(12,342)
(101,017)
172,675
71,658
(25,441)
46,217
(308)
1,575
1,267
100
1,367
(125)
(125)
50
(75)
Other revenues
Total before tax
Income tax
Net of tax
See Note
See Note
Total before tax
Income tax
Net of tax
Other revenues
Other costs and expenses
Total before tax
Income tax
Net of tax
Other revenues
Total before tax
Income tax
Net of tax
Total amounts reclassified
¥ 4,220
$ 35,167
Net of tax
Note: These accumulated other comprehensive income components are included in the computation of net periodic retirement
and severance costs. See Note 10 “Retirement and Severance Benefits”.
58 MITSUBISHI ELECTRIC CORPORATION ANNUAL REPORT 2015
Details about Accumulated other
comprehensive income components
Pension liability adjustments
Amortization of prior service cost
Amortization of actuarial loss
Unrealized gains (losses) on securities
Realized losses on sales
Other
Unrealized gains (losses) on derivative
instruments
Other
Yen (millions)
2014
Amounts reclassified
from accumulated
other comprehensive
income
Affected line items in consolidated
statements of income
¥(22,216)
21,544
(672)
239
(433)
1,166
13
1,179
(419)
760
42
42
(10)
32
See Note
See Note
Total before tax
Income tax
Net of tax
Other costs and expenses
Other costs and expenses
Total before tax
Income tax
Net of tax
Other costs and expenses
Total before tax
Income tax
Net of tax
Total amounts reclassified
¥ 359
Net of tax
Note: These accumulated other comprehensive income components are included in the computation of net periodic retirement and severance costs. See Note 10
“Retirement and Severance Benefits”.
Tax effects allocated to each component of other comprehensive income (loss) and reclassification adjustments for the years
ended March 31, 2015, 2014 and 2013 are as follows:
2015:
Foreign currency translation adjustments:
Amount arising during the year on investments in
foreign entities held at end of year
Less reclassification adjustments for gains (losses)
realized in net income
Net change in foreign currency translation
adjustments during the year
Pension liability adjustments:
Amount arising during the year on pension liability adjustments
Less reclassification adjustments for gains (losses)
realized in net income
Net change in pension liability adjustment
Unrealized gains (losses) on securities:
Unrealized holding gains (losses) arising during the year
Less reclassification adjustments for gains (losses)
realized in net income
Net change in unrealized gains (losses) on securities
Unrealized gains (losses) on derivative instruments:
Unrealized holding gains (losses) arising during the year
Less reclassification adjustments for gains (losses)
realized in net income
Net change in unrealized gains (losses) on derivative instruments
Before-tax amount
Tax (expense)
or benefit
Yen (millions)
Net-of-tax amount
¥ 74,884
¥ (9,096)
¥ 65,788
(1,481)
—
(1,481)
73,403
25,167
8,599
33,766
50,780
152
50,932
35
(15)
20
(9,096)
(9,542)
(3,053)
(12,595)
(14,328)
12
(14,316)
(13)
6
(7)
64,307
15,625
5,546
21,171
36,452
164
36,616
22
(9)
13
Other comprehensive income (loss)
¥158,121
¥(36,014)
¥122,107
MITSUBISHI ELECTRIC CORPORATION ANNUAL REPORT 2015 59
Before-tax amount
Tax (expense)
or benefit
Yen (millions)
Net-of-tax amount
2014:
Foreign currency translation adjustments:
Amount arising during the year on investments in
foreign entities held at end of year
¥ 50,955
¥ (4,280)
¥46,675
Less reclassification adjustments for gains (losses)
realized in net income
Net change in foreign currency translation
adjustments during the year
Pension liability adjustments:
Amount arising during the year on pension liability adjustments
Less reclassification adjustments for gains (losses)
realized in net income
Net change in pension liability adjustment
Unrealized gains (losses) on securities:
Unrealized holding gains (losses) arising during the year
Less reclassification adjustments for gains (losses)
realized in net income
Net change in unrealized gains (losses) on securities
Unrealized gains (losses) on derivative instruments:
Unrealized holding gains (losses) arising during the year
Less reclassification adjustments for gains (losses)
realized in net income
Net change in unrealized gains (losses) on derivative instruments
—
—
—
50,955
(4,280)
46,675
(8,235)
(672)
(8,907)
85,230
1,179
86,409
(132)
42
(90)
1,912
239
2,151
(30,399)
(419)
(30,818)
34
(10)
24
(6,323)
(433)
(6,756)
54,831
760
55,591
(98)
32
(66)
Other comprehensive income (loss)
¥128,367
¥(32,923)
¥95,444
Before-tax amount
Tax (expense)
or benefit
Yen (millions)
Net-of-tax amount
2013:
Foreign currency translation adjustments:
Amount arising during the year on investments in
foreign entities held at end of year
¥ 64,668
¥ (5,037)
¥ 59,631
Less reclassification adjustments for gains (losses)
realized in net income
Net change in foreign currency translation
adjustments during the year
Pension liability adjustments:
Amount arising during the year on pension liability adjustments
Less reclassification adjustments for gains (losses)
realized in net income
Net change in pension liability adjustment
Unrealized gains (losses) on securities:
Unrealized holding gains (losses) arising during the year
Less reclassification adjustments for gains (losses)
realized in net income
Net change in unrealized gains (losses) on securities
Unrealized gains (losses) on derivative instruments:
Unrealized holding gains (losses) arising during the year
Less reclassification adjustments for gains (losses)
realized in net income
Net change in unrealized gains (losses) on derivative instruments
Other comprehensive income (loss)
—
64,668
68,765
5,505
74,270
20,071
1,962
22,033
134
—
(5,037)
(24,545)
(2,092)
(26,637)
(6,489)
(741)
(7,230)
(53)
—
59,631
44,220
3,413
47,633
13,582
1,221
14,803
81
(47)
87
¥161,058
15
(38)
¥(38,942)
(32)
49
¥122,116
60 MITSUBISHI ELECTRIC CORPORATION ANNUAL REPORT 2015
Before-tax amount
U.S. dollars (thousands)
Tax (expense)
or benefit
Net-of-tax amount
2015:
Foreign currency translation adjustments:
Amount arising during the year on investments in
foreign entities held at end of year
$ 624,034
$ (75,800)
$ 548,234
Less reclassification adjustments for gains (losses)
realized in net income
Net change in foreign currency translation
adjustments during the year
Pension liability adjustments:
Amount arising during the year on pension liability adjustments
Less reclassification adjustments for gains (losses)
realized in net income
Net change in pension liability adjustment
Unrealized gains (losses) on securities:
Unrealized holding gains (losses) arising during the year
Less reclassification adjustments for gains (losses)
realized in net income
Net change in unrealized gains (losses) on securities
Unrealized gains (losses) on derivative instruments:
Unrealized holding gains (losses) arising during the year
Less reclassification adjustments for gains (losses)
realized in net income
Net change in unrealized gains (losses) on derivative instruments
(12,342)
—
(12,342)
611,692
(75,800)
535,892
209,725
(79,517)
130,208
71,658
281,383
(25,441)
(104,958)
46,217
176,425
423,166
(119,400)
303,766
1,267
424,433
100
(119,300)
1,367
305,133
292
(125)
167
(109)
50
(59)
183
(75)
108
Other comprehensive income (loss)
$1,317,675
$(300,117)
$1,017,558
(13) NET INCOME PER SHARE ATTRIBUTABLE TO MITSUBISHI ELECTRIC CORP.
A reconciliation of the numerators and denominators of the basic and diluted net income per share attributable to Mitsubishi
Electric Corp. calculations is as follows:
Net income attributable to
Mitsubishi Electric Corp.
Effect of dilutive securities
Diluted net income attributable to
Mitsubishi Electric Corp.
Average common shares outstanding
Effect of dilutive securities:
Diluted common shares outstanding
Net income per share attributable to
Mitsubishi Electric Corp.:
Basic
Diluted
2015
2014
Yen (millions)
2013
U.S. dollars
(thousands)
2015
¥234,694
—
¥153,473
—
¥69,517
—
$1,955,783
—
¥234,694
¥153,473
¥69,517
$1,955,783
2015
2,146,835,581
—
2,146,835,581
2014
2,146,871,671
—
2,146,871,671
Shares
2013
2,146,906,220
—
2,146,906,220
2015
2014
2013
2015
Yen
U.S. dollars
¥109.32
—
¥71.49
—
¥32.38
—
$0.911
—
Diluted net income per share attributable to Mitsubishi Electric Corp. is not presented as no dilutive securities existed as of and
for the years ended March 31, 2015, 2014 and 2013.
MITSUBISHI ELECTRIC CORPORATION ANNUAL REPORT 2015 61
(14) DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES
Foreign Exchange Risk Management and Interest Rate Risk
Management
The Company and its subsidiaries operate internationally, giv-
Information with Respect to Cash Flow Hedges
The Company and certain of its subsidiaries have entered into
forward foreign exchange contracts mainly with forecasted
ing rise to significant exposure to market risks from changes
transactions to hedge against market risks from changes
in foreign currencies and interest rates. Derivative financial
in foreign currencies and interest rate swap agreements to
instruments are comprised principally of foreign exchange
modify the interest rate characteristics of a portion of its long-
contracts, foreign currency swaps and interest rate swaps uti-
term debt from a variable to a fixed rate. The Company and
lized by the Company and certain of its subsidiaries to reduce
certain of its subsidiaries designate them as cash flow hedges.
these risks. The Company and its subsidiaries do not hold or
The maximum period for cash flow hedges is 30 months. The
issue financial instruments for trading purposes.
Company expects that the amounts of net loss of ¥46 mil-
Contract Amounts, Notional Principal Amounts and Credit
Risk
The Company and its subsidiaries are exposed to risk of credit-
related losses in the event of nonperformance by counterpar-
ties to foreign exchange contracts, foreign currency swaps
and interest rate swaps. The Company believes such risk is
minimal due to the high credit ratings of these counterparties.
Information with Respect to Fair Value Hedges
Certain subsidiaries have entered into foreign currency swaps
to hedge currency exposure and designate them as fair value
hedges.
lion ($383 thousand) in accumulated other comprehensive
income (loss) will be reclassified into earnings over the next
12 months with transactions such as collection of foreign cur-
rency receivables and payment of foreign currency payables
and interests on long-term debt.
Derivatives not designated as hedging Instruments
The Company and certain of its subsidiaries enter into foreign
exchange contracts and certain of foreign currency swaps and
interest rate swaps that are not designated as hedging instru-
ments to hedge against certain foreign currency and interest
rate exposures. The Company and certain of its subsidiaries
recognize the changes in unrealized gains and losses on such
instruments in earnings.
Contract amounts of foreign exchange contracts and foreign currency swaps and notional principal amounts of interest rate
swaps at March 31, 2015 and 2014 are as follows:
Foreign exchange contracts:
Forwards to sell foreign currencies
Forwards to buy foreign currencies
Foreign currency swaps
Interest rate swaps
2015
¥240,279
97,441
31,400
2,000
Yen (millions)
2014
¥208,775
91,194
37,010
2,000
U.S. dollars
(thousands)
2015
$2,002,325
812,008
261,667
16,667
The estimated fair values of foreign exchange contracts, foreign currency swaps and interest rate swaps at March 31, 2015 and
2014 are as follows:
Derivatives designated as hedging instruments
Consolidated balance sheet line item
2015
Yen (millions)
2014
Asset derivatives
Estimated fair value
U.S. dollars
(thousands)
2015
Foreign exchange contracts
Prepaid expenses and
other current assets
¥95
¥27
$792
Derivatives designated as hedging instruments
Consolidated balance sheet line item
Foreign exchange contracts
Other current liabilities
2015
¥61
Yen (millions)
2014
¥115
Liability derivatives
Estimated fair value
U.S. dollars
(thousands)
2015
$508
62 MITSUBISHI ELECTRIC CORPORATION ANNUAL REPORT 2015
Derivatives not designated as hedging instruments
Consolidated balance sheet line item
Foreign exchange contracts
Foreign currency swaps
Interest rate swaps
Total
Prepaid expenses and
other current assets
Prepaid expenses and
other current assets
Investments in securities
and other
Derivatives not designated as hedging instruments
Consolidated balance sheet line item
Foreign exchange contracts
Foreign currency swaps
Total
Other current liabilities
Other current liabilities
2015
Yen (millions)
2014
Asset derivatives
Estimated fair value
U.S. dollars
(thousands)
2015
¥5,499
¥1,006
$45,825
126
21
¥5,646
70
1,050
60
¥1,136
175
$47,050
2015
¥2,673
381
¥3,054
Yen (millions)
2014
¥1,993
2
¥1,995
Liability derivatives
Estimated fair value
U.S. dollars
(thousands)
2015
$22,275
3,175
$25,450
The effect of foreign exchange contracts and interest rate swaps designated as cash flow hedges on the consolidated statements
of income for the years ended March 31, 2015 and 2014 are as follows:
Derivatives designated as cash flow hedging
instruments
Foreign exchange contracts
Interest rate swaps
Total
Derivatives designated as cash flow hedging
instruments
Line item of gain or (loss) recognized
from accumulated OCI into income
Amount of gain or (loss) recognized in OCI on derivative
(effective portion)
U.S. dollars
(thousands)
2015
¥20
—
¥20
Yen (millions)
2014
¥(151)
61
¥ (90)
2015
$167
—
$167
Amount of gain or (loss) recognized from accumulated OCI into income
(effective portion)
U.S. dollars
(thousands)
Yen (millions)
2014
2015
2015
Foreign exchange contracts
Other revenues
(cost and expenses)
¥15
¥(42)
$125
The effect of foreign exchange contracts, foreign currency swaps and interest rate swaps not designated as hedging instruments
on the consolidated statements of income for the years ended March 31, 2015 and 2014 are set forth below:
Derivatives not designated as hedging instruments
Line item of gain or (loss) recognized
in income on derivative
Amount of gain or (loss) recognized in income on derivative
U.S. dollars
(thousands)
Yen (millions)
2014
2015
2015
Foreign exchange contracts
Foreign currency swaps
Interest rate swaps
Total
Other revenues
(cost and expenses)
Other revenues
(cost and expenses)
Other revenues
(cost and expenses)
¥(12,324)
¥(19,807)
$(102,700)
(1,779)
704
(14,825)
(39)
¥(14,142)
(24)
¥(19,127)
(325)
$(117,850)
MITSUBISHI ELECTRIC CORPORATION ANNUAL REPORT 2015 63
(15) SECURITIZATIONS
The Company sells its accounts receivable under several secu-
these receivables.
ritization programs.
When the Company retains subordinated interests in the
certain accounts receivables after the sale of these receivables,
The Company recognized losses of ¥541 million ($4,508
485 million and ¥492 million on the securitiza-
thousand), ¥485 million and ¥492 million on the securitiza-
tions of receivables for the years ended March 31, 2015, 2014
a portion of these, where the Company retains subordi-
and 2013, respectively.
nated interests, is not taken off from the balance sheet and
Subsequent to securitization, the Company retains collec-
is recorded at their fair value. Such carrying value is adjusted
tion and administrative responsibilities for the receivables. The
to reflect the portion that is not expected to be collectible. As
Company has not recorded a servicing asset or liability since
of March 31, 2015, the Company did not retain subordinated
the cost of collection effort is approximate to the amount of
interests in the certain accounts receivables after the sale of
commission income.
Certain cash flows received from special purpose entities (SPEs) and banks on the above transactions for the years ended March
31, 2015, 2014 and 2013 are as follows:
Proceeds from new securitizations
2015
¥441,395
2014
¥424,556
Yen (millions)
2013
¥404,156
U.S. dollars
(thousands)
2015
$3,678,292
Quantitative information about trade receivables including securitized receivables as of March 31, 2015 and 2014 are as
follows:
Trade receivables
Less: Securitized receivables
Total receivables
2015
¥1,182,431
133,889
Yen (millions)
2014
¥1,106,139
122,671
¥1,048,542
¥ 983,468
U.S. dollars
(thousands)
2015
$9,853,592
1,115,742
$8,737,850
As of March 31, 2015 and 2014, delinquencies and credit losses of trade receivables including securitized receivables are
immaterial.
(16) COMMITMENTS AND CONTINGENT LIABILITIES
At March 31, 2015, commitments outstanding for the pur-
infringement of EU Competition Law in connection with its
chase of property, plant and equipment were ¥23,450 million
sales of certain gas-insulated switchgears in Europe. However,
($195,417 thousand).
there was a significant inconsistency on recognition of the
It is common practice in Japan for companies, in the ordi-
material underlying facts between the European Commission
nary course of business, to receive promissory notes in settle-
and the Company. Therefore, the Company appealed to the
ment of accounts receivable and to subsequently discount
European General Court and challenged the decision. In July
such notes at banks. At March 31, 2015, certain subsidiaries
2011, the Company received a judgment from the European
were contingently liable to trade notes discounted in the
General Court upholding the European Commission’s deci-
amount of ¥414 million ($3,450 thousand). Certain subsidiar-
sion on the underlying facts while annulling the fine imposed
ies account for the discounted notes as sale of receivables.
on the Company on the basis that the European Commission
As of March 31, 2015, the Company has no significant
applied inconsistent methods of calculation to different
concentrations of credit risk.
companies.
While the Company and certain of its subsidiaries are
In September 2011, since there was still a significant
defendants and co-defendants in various lawsuits and
inconsistency on recognition of the material underlying facts
legal actions, based upon the advice of legal counsel, the
between the European Commission and the Company, the
Company’s management is of the opinion that damages, if
Company appealed to the European Court of Justice.
any, would not have a material effect on the Company’s con-
solidated financial position and results of operations, except
In June 2012, the Company received the European
Commission’s decision presenting an amount of fine as pay-
for the following cases.
able by the Company after revision of the pertinent computa-
In January 2007, the Company received a decision ren-
tions. In September 2012, the Company took another legal
dered by the European Commission imposing fines for an
action with the European General Court seeking a revision of
64 MITSUBISHI ELECTRIC CORPORATION ANNUAL REPORT 2015
the current computation method presented by the European
payments.
Commission, which would result in a downward modifica-
tion of the fine. In December 2013, the Company received a
judgment from the European Court of Justice upholding the
European Commission’s underlying facts. The legal action the
Company filed in September 2012 with the European General
Court is currently pending.
Since July 2011, the Company has been cooperating
with Competition Law investigations and inquiries conducted
by the European Commission regarding the sales of certain
automotive parts in Europe. In addition, civil lawsuits relating
to the Antitrust Laws regarding the sale of certain automotive
parts have also been raised in the United States of America.
The Company agreed to settle with some purchasers in rela-
tion to the aforementioned matter and made settlement
As of March 31, 2015, the Company recorded an esti-
mated amount of ¥36,763 million ($306,358 thousand) as a
reserve for these various competition-law-related expenses in
“Other liabilities” relating to the gas-insulated switchgears
case in Europe and certain automotive parts cases in the
United States of America and Europe. For the year ended
March 31, 2015, the Company also recorded ¥44,163 mil-
lion ($368,025 thousand) as various competition-law-related
expenses in “Costs and expenses – Other”, which represents
the difference between the reserve amount at the prior year-
end and the sum of the reserve amount at the current year–
end plus the actual amounts paid and other miscellaneous
items recorded during the current year.
The following table provides the undiscounted maximum amount of potential future payments for each major group of guaran-
tees at March 31, 2015:
Guarantees of bank loan:
Employees
Affiliated and other companies
Other
Total
Yen (millions)
¥3,191
260
6,203
¥9,654
U.S. dollars
(thousands)
$26,592
2,166
51,692
$80,450
The guarantees for the employees are principally made for
nies are made to enhance their credit, and the term of guar-
their housing loans, and the term of guarantees is 1 year to
antees is 1 year.
14 years. The guarantees for the affiliated and other compa-
Change in accrued product warranty for the years ended March 31, 2015 and 2014 is summarized as follows:
Balance at beginning of year
Addition
Utilization
Foreign currency translation adjustments
Balance at end of year
2015
¥58,268
47,922
51,160
453
¥55,483
Yen (millions)
2014
¥46,920
50,781
40,091
658
¥58,268
U.S. dollars
(thousands)
2015
$485,566
399,350
426,333
3,775
$462,358
(17) FAIR VALUE OF FINANCIAL INSTRUMENTS
The Company uses the following methods and assumptions
(b) Short-term investments and Investments in securities
to estimate the fair value of each class of financial instrument
and other
for which it is practical to estimate its value:
The fair values of most short-term investments and invest-
(a) Cash and cash equivalents, Trade receivables, Bank
loans, Trade payables and Other current liabilities
The carrying amount approximates fair value because of the
short term nature of these instruments.
ments in securities and other are estimated based on quoted
market prices for these instruments. For other investments
for which there are no quoted market prices, a reasonable
estimate of fair value could not be made without incurring
excessive costs.
MITSUBISHI ELECTRIC CORPORATION ANNUAL REPORT 2015 65
(c) Long-term trade receivables
The fair value of the Company’s long-term trade receivables is
calculated under income approach using market interest rates,
therefore, it is classified in level 2.
(d) Long-term debt
The fair value of the Company’s corporate bonds is calculated
market interest rates, therefore, it is classified in level 2. The
Company excludes the financial instruments relating to lease
activities because its carrying amount approximates fair value.
(e) Derivative financial instruments
The fair values of derivative financial instruments, consisting
principally of foreign exchange contracts, foreign currency
under market approach using quoted published price, there-
swaps and interest rate swaps are estimated by obtaining
fore, it is classified in level 2. The fair value of the Company’s
quotes from brokers. (See note 14 about estimated fair value.)
long-term debt is calculated under income approach using
The estimated fair values of the Company’s financial instruments at March 31, 2015 and 2014 are summarized as follows:
2015
Carrying
amount
Yen (millions)
2014
Estimated
fair value
Carrying
amount
Estimated
fair value
U.S. dollars
(thousands)
Estimated
fair value
2015
Carrying
amount
Nonderivatives:
Assets:
Marketable securities and other
Long-term trade receivables
¥271,962
5,633
¥271,962
5,615
¥226,985
4,813
¥226,985
4,865
$2,266,350
46,942
$2,266,350
46,792
Liabilities:
Long-term debt, including
current portion
285,765
285,407
287,280
287,852
2,381,375
2,378,392
Limitations
Fair value estimates are made at a specific point in time based
and involve uncertainties and matters of significant judgment
on relevant market information and information about the
and therefore cannot be determined with precision. Changes
financial instrument. These estimates are subjective in nature
in assumptions could significantly affect the estimates.
(18) FAIR VALUE MEASUREMENTS
The Company defines fair value as “the price that would be
Level 1: Quoted prices in active markets for identical assets or
received to sell an asset or paid to transfer a liability in an
liabilities.
orderly transaction between market participants at the mea-
surement date”. On that basis, the Company has categorized
Level 2: Inputs other than quoted prices included within Level
1 that are directly or indirectly observable for the
the inputs for fair value measurement by the valuation tech-
asset or liability.
nique into a three-level hierarchy, and placed the order of
Level 3: Unobservable inputs for the asset or liability.
priority.
Assets and Liabilities Measured at Fair Value on a Recurring Basis
The following tables present the fair value hierarchy for those assets and liabilities measured at fair value on a recurring basis as
of March 31, 2015 and 2014. The Company measures the fair value of those assets and liabilities in accordance with the require-
ments of FASB ASC for those assets and liabilities.
Assets:
Equity securities
Marketable equity securities
Debt securities
Government, municipal and corporate debt securities, and others
Investment trusts
Derivatives
Liabilities:
Derivatives
66 MITSUBISHI ELECTRIC CORPORATION ANNUAL REPORT 2015
Level 1
Level 2
Level 3
Total
2015
Yen (millions)
¥271,443
¥ —
¥ —
¥271,443
—
—
—
—
—
519
5,741
3,115
—
—
—
—
—
519
5,741
3,115
Assets:
Equity securities
Marketable equity securities
Debt securities
Government, municipal and corporate debt securities, and others
Investment trusts
Derivatives
Liabilities:
Derivatives
Level 1
Level 2
Level 3
Total
2014
Yen (millions)
¥223,173
¥ —
¥ —
¥223,173
—
—
—
—
2,952
860
1,163
2,110
—
—
—
—
2,952
860
1,163
2,110
U.S. dollars (thousands)
2015
Level 1
Level 2
Level 3
Total
Assets:
Equity securities
Marketable equity securities
Debt securities
Government, municipal and corporate debt securities, and others
Investment trusts
Derivatives
Liabilities:
Derivatives
$2,262,025
$ —
$ — $2,262,025
—
—
—
—
—
4,325
47,842
25,958
—
—
—
—
—
4,325
47,842
25,958
Level 1 equity securities are marketable equity securities,
and frequency of transactions. Level 2 debt securities are
which are valued using unadjusted quoted market prices in
valued based on market approach, using quoted prices for
active markets with sufficient volume and frequency of trans-
identical assets in markets that are not active. Level 2 deriva-
actions. Debt securities are comprised of government, munici-
tives are comprised principally of foreign exchange contracts,
pal and corporate debt securities and others, and investment
which are valued based on market approach, using quotes
trusts. Level 1 debt securities are valued using unadjusted
obtained from counterparties or third parties.
quoted market prices in active markets with sufficient volume
Assets and Liabilities Measured at Fair Value on a Nonrecurring Basis
At March 31, 2015, in accordance with the requirements of
portion of long-lived assets was written down to their fair
FASB ASC Topic 360 “Property, Plant and Equipment”, a por-
value of ¥4,162 million, resulting in an impairment charge
tion of long-lived assets was written down to their fair value
of ¥3,791 million, which was included in loss on impairment
of ¥4,197 million ($34,975 thousand), resulting in an impair-
of long-lived assets for the year ended March 31, 2014. The
ment charge of ¥3,085 million ($25,708 thousand), which was
impaired long-lived assets are classified as Level 3 assets,
included in loss on impairment of long-lived assets for the year
because they are measured based on the unobservable inputs
ended March 31, 2015. The impaired long-lived assets are clas-
such as estimated future cash flows under income approach
sified as Level 3 assets, because they are measured based on the
or net sale price under market approach.
unobservable inputs such as estimated future cash flows under
The valuation process of long-lived assets is docu-
income approach or net sale price under market approach.
mented in “Notes to Consolidated Financial Statements (1)
At March 31, 2014, in accordance with the requirements
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT
of FASB ASC Topic 360 “Property, Plant and Equipment”, a
ACCOUNTING POLICIES (u)Impairment of Long-Lived Assets”.
(19) SUPPLEMENTARY INCOME AND EXPENSE INFORMATION
Advertising expenses
Shipping and handling costs
Exchange gains
Business restructuring costs
Competition-law-related expenses
(for the United States Department of Justice)
Refund payment for overcharged expenses
Loss on impairment of long-lived assets
2015
¥(28,101)
(87,610)
7,749
(4,804)
—
—
(3,085)
2014
¥(23,847)
(79,634)
9,709
—
(7,738)
—
(3,791)
Yen (millions)
2013
¥(18,029)
(71,613)
8,034
—
—
(75,717)
(4,317)
U.S. dollars
(thousands)
2015
$(234,175)
(730,083)
64,575
(40,033)
—
—
(25,708)
MITSUBISHI ELECTRIC CORPORATION ANNUAL REPORT 2015 67
Advertising expenses are included in “Costs and expenses -
Technology. Also, similar incidents were identified concerning
Selling, general and administrative”.
contracts between four of the Company’s affiliates and MOD.
Shipping and handling costs represents the costs included
As a result of investigation conducted by the entities, for the
in “Costs and expenses - Selling, general and administrative”.
year ended March 31, 2013, the Company recorded a total of
Exchange gains are included in “Revenues - Other”.
¥75,717 million as a refund payment for overcharged expens-
Business restructuring costs are included in “Costs and
es in “Costs and expenses – Other” that covered the refund
expenses - Other”.
of overcharged expenses, related penalties and interest arising
For the year ended March 31,2015, the Company recog-
from the series of incidents referred to herein.
nized business restructuring costs of ¥4,804 million ($40,033
Loss on impairment of long-lived assets is included in
thousand) related to the loss associated with inventories
“Costs and expenses - Loss on impairment of long-lived
under sales contracts, the removal and disposal of facilities
assets”.
and the retirement benefits resulting from the Company’s
For the year ended March 31, 2015, the Company and
decision to discontinue the copper alloy business.
certain of its subsidiaries recognized impairment losses of
Competition-law-related expenses (for the United States
¥2,751 million ($22,925 thousand) on tangible assets such
Department of Justice) are included in “Costs and expenses
as buildings and tools, and ¥334 million ($2,783 thousand)
- Other”.
on intangible assets. The impairment losses included ¥562
Since July 2011, the Company and certain of its sub-
million ($4,683 thousand) for Energy and Electric Systems
sidiaries had been subject to investigations and inquiries
business related assets and ¥1,740 million ($14,500 thousand)
conducted by the United States Department of Justice in
relation to United States Antitrust Laws regarding the sale
for Home Appliances business related assets due to a decline
in profitability. The impairment losses were mainly measured
of certain automotive parts in the United States of America.
based on the fair value less costs to sell.
Consequently, in September 2013, the Company entered
For the year ended March 31, 2014, the Company and
into a plea agreement with the United States Department
certain of its subsidiaries recognized impairment losses of
of Justice in which the Company agreed to pay US$190,000
¥3,627 million on tangible assets such as land, buildings and
thousand (¥18,573 million based on the rate of exchange in
tools, and ¥164 million on intangible assets. The impairment
effect at the date of the transaction) in fines for the infringe-
losses included ¥1,217 million for Home Appliances business
ment of United States Antitrust Laws. For the year ended
related assets due to a decline in profitability and ¥2,260 mil-
March 31, 2014, the Company recorded ¥7,738 million,
lion for welfare related assets which are scheduled to be sold.
which was equivalent to the difference between the fines and
The impairment losses were mainly measured based on the
its reserves as of March 31, 2013 as various competition-law-
fair value less costs to sell.
related expenses.
For the year ended March 31, 2013, the Company
Refund payment for overcharged expenses is included in
and certain of its subsidiaries recognized impairment loss-
“Costs and expenses - Other”.
es of ¥4,014 million on tangible assets such as buildings
For the electronic systems business, it was revealed in
and machinery, and ¥303 million on intangible assets. The
January 2012 that the Company had been billing improperly
impairment losses included ¥2,404 million for Electronic
overcharged project costs by transferring man-hours among
Devices business related assets and ¥1,212 million for Home
different contracts which the Company entered into with
Appliances business related assets due to a decline in profit-
the Japanese Ministry of Defense(MOD), Cabinet Satellite
ability. The impairment losses were mainly measured based
Intelligence Center, Japan Aerospace Exploration Agency,
on the fair value of the discounted present value of expected
and National Institute of Information and Communications
future cash flow.
(20) LEASES
The Company and certain of its subsidiaries enter into capital
The Company and certain of its subsidiaries lease machin-
lease and operating lease agreements with Mitsubishi Electric
ery and equipments. At March 31, 2015, the aggregated cost
Credit Corporation, an equity method investee. The leased
and accumulated depreciation of leased assets under capital
assets, which are committed under capital lease agreements,
leases amounted to ¥39,264 million ($327,200 thousand) and
are capitalized.
¥21,671 million ($180,592 thousand), respectively.
68 MITSUBISHI ELECTRIC CORPORATION ANNUAL REPORT 2015
Future minimum lease payments under capital and non-cancelable operating leases as of March 31, 2015 are as follows:
Year ending March 31:
2016
2017
2018
2019
2020
Thereafter
Total minimum lease payments
Less: Estimated executory costs
Net minimum lease payments
Less: Amount representing interest
Present value of net minimum capital lease payments
Less: Current portion of obligations under capital leases
Obligations under capital leases, excluding current portion
Yen (millions)
U.S. dollars
(thousands)
Capital leases Operating leases
Capital leases Operating leases
¥ 6,076
4,315
2,847
1,649
1,155
3,003
¥19,045
¥10,009
7,761
5,069
2,455
614
47
25,955
1,314
24,641
797
23,844
9,199
¥14,645
$ 50,633
35,958
23,725
13,742
9,625
25,025
$158,708
$ 83,408
64,675
42,242
20,458
5,117
392
216,292
10,950
205,342
6,642
198,700
76,658
$122,042
Rental expenses related to operating leases for the years
ended March 31, 2015, 2014 and 2013 amounted to
¥42,587 million, respectively. These operating leases are for
office space, warehouses, employee facilities and computer
¥47,670 million ($397,250 thousand), ¥45,246 million and
equipment, and are customarily renewed.
(21) SUPPLEMENTARY CASH FLOW INFORMATION
Cash paid during the year for:
Interest
Income taxes
(22) SEGMENT INFORMATION
2015
2014
Yen (millions)
2013
¥ 3,816
53,712
¥ 4,795
37,434
¥ 6,425
41,022
U.S. dollars
(thousands)
2015
$ 31,800
447,600
Operating segment presented below is identified based on the
business segments, Energy and Electric Systems, Industrial
segments for which separate financial information is available,
Automation Systems, Information and Communication
and is periodically used for decision of business resources allo-
Systems, Electronic Devices, Home Appliances, and Others,
cation and evaluation of business operation by the Company’s
based on types and characteristics of products, production
management.
method, and similarity in market.
The Company conducts business through 6 reportable
MITSUBISHI ELECTRIC CORPORATION ANNUAL REPORT 2015 69
Principal businesses of each segment are as follows:
Energy and Electric
Systems
Turbine generators, hydraulic turbine generators, nuclear power plant equipment, motors, transformers, power
electronics equipment, circuit breakers, gas insulated switches, switch control devices, surveillance-system control
and security systems, large display devices, electrical equipment for locomotives and rolling stock, elevators,
escalators, building security systems, building management systems, particle beam treatment systems, and others
Industrial
Automation
Systems
Programmable logic controllers, inverters, servomotors, human-machine interface, motors, hoists, magnetic
switches, no-fuse circuit breakers, short-circuit breakers, transformers for electricity distribution, time and power
meters, uninterruptible power supply, industrial fans, computerized numerical controllers, electrical-discharge
machines, laser processing machines, industrial robots, clutches, automotive electrical equipment, car electronics
and car mechatronics, car multimedia, and others
Information and
Communication
Systems
Wireless and wired communications systems, surveillance cameras, satellite communications equipment, satellites,
radar equipment, antennas, missile systems, fire control systems, broadcasting equipment, data transmission
devices, network security systems, information systems equipment, systems integration, and others
Electronic Devices
Power modules, high-frequency devices, optical devices, LCD devices, and others
Home Appliances
LCD televisions, room air conditioners, package air conditioners, air-to-water heat pump boilers, refrigerators, electric
fans, ventilators, photovoltaic power generation systems, hot water supply systems, LED lamps, fluorescent lamps,
indoor lighting, compressors, chillers, dehumidifiers, air purifiers, showcases, cleaners, rice cookers, microwave ovens,
IH cooking heaters, and others
Others
Procurement, logistics, real estate, advertising, finance and other services
Intersegment transactions are conducted generally at the price that the Company’s management recognizes as approximate
arm’s length price. Operating income (loss) in Segment Information is measured in a manner consistent with consolidated operat-
ing income.
Segment Information
Segment information for the years ended March 31, 2015, 2014 and 2013 are as follows:
As of and for the year ended March 31, 2015
Yen (millions)
Energy and
Electric Systems
Industrial
Automation
Systems
Information and
Communication
Systems
Electronic
Devices
Home
Appliances
Others
Subtotal
Eliminations
and other
Total
I Net sales and
operating income
Sales:
(1) External customers
(2) Intersegment
Net sales
Operating costs
Operating income
II Assets, depreciation
and amortization,
loss on impairment of
long-lived assets, and
capital expenditures
Assets
Depreciation and
amortization
Loss on impairment of
long-lived assets
Capital expenditures
¥1,219,983
8,975
1,228,958
1,156,510
¥ 72,448
¥1,268,858
13,891
1,282,749
1,136,767
¥ 145,982
¥520,853
38,668
559,521
540,587
¥ 18,934
¥209,235
29,167
238,402
208,239
¥ 30,163
¥925,004
19,826
944,830
890,534
¥ 54,296
¥179,108
561,409
740,517
716,775
¥ 23,742
¥4,323,041
671,936
4,994,977
4,649,412
¥ 345,565
¥ — ¥4,323,041
—
(671,936)
4,323,041
(671,936)
4,005,437
(643,975)
¥ 317,604
¥ (27,961)
¥1,300,581
¥1,064,560
¥383,692
¥206,981
¥769,899
¥246,136
¥3,971,849
¥ 87,602
¥4,059,451
29,056
56,842
23,814
26,055
30,605
6,241
172,613
562
35,500
26
67,943
2
18,383
203
38,406
1,740
46,598
552
8,382
3,085
215,212
—
—
—
172,613
3,085
215,212
70 MITSUBISHI ELECTRIC CORPORATION ANNUAL REPORT 2015
As of and for the year ended March 31, 2014
Yen (millions)
Energy and
Electric Systems
Industrial
Automation
Systems
Information and
Communication
Systems
Electronic
Devices
Home
Appliances
Others
Subtotal
Eliminations
and other
Total
As of and for the year ended March 31, 2013
I Net sales and
operating income
Sales:
(1) External customers
(2) Intersegment
Net sales
Operating costs
Operating income
II Assets, depreciation
and amortization,
loss on impairment of
long-lived assets, and
capital expenditures
Assets
Depreciation and
amortization
Loss on impairment of
long-lived assets
Capital expenditures
I Net sales and
operating income
Sales:
(1) External customers
(2) Intersegment
Net sales
Operating costs
Operating income (loss)
II Assets, depreciation
and amortization,
loss on impairment of
long-lived assets, and
capital expenditures
Assets
Depreciation and
amortization
Loss on impairment of
long-lived assets
Capital expenditures
¥1,171,292
8,801
1,180,093
1,103,769
¥ 76,324
¥1,089,109
9,687
1,098,796
1,000,717
¥ 98,079
¥513,712
34,570
548,282
542,753
¥ 5,529
¥174,082
20,576
194,658
184,608
¥ 10,050
¥927,868
16,483
944,351
891,473
¥ 52,878
¥178,296
497,738
676,034
656,233
¥ 19,801
¥4,054,359
587,855
4,642,214
4,379,553
¥ 262,661
¥ — ¥4,054,359
—
4,054,359
3,819,187
¥ 235,172
(587,855)
(587,855)
(560,366)
¥ (27,489)
¥1,161,790
¥932,857
¥399,215
¥172,925
¥706,833
¥242,496
¥3,616,116
¥ (3,150)
¥3,612,966
27,852
52,381
21,289
11,638
28,748
6,000
147,908
—
32,639
—
63,660
—
22,172
115
10,405
1,217
30,334
2,459
8,490
3,791
167,700
—
—
—
147,908
3,791
167,700
Yen (millions)
Energy and
Electric Systems
Industrial
Automation
Systems
Information and
Communication
Systems
Electronic
Devices
Home
Appliances
Others
Subtotal
Eliminations
and other
Total
¥1,049,982
8,195
1,058,177
973,037
¥ 85,140
¥918,123
9,734
927,857
867,265
¥ 60,592
¥491,792
30,630
522,422
520,831
¥ 1,591
¥142,961
21,104
164,065
169,645
¥ (5,580)
¥799,817
21,481
821,298
801,998
¥ 19,300
¥164,509
425,857
590,366
571,576
¥ 18,790
¥3,567,184
517,001
4,084,185
3,904,352
¥ 179,833
¥ —
(517,001)
(517,001)
(489,263)
¥ (27,738)
¥3,567,184
—
3,567,184
3,415,089
¥ 152,095
¥1,134,443
¥863,477
¥486,183
¥132,793
¥668,313
¥213,989
¥3,499,198
¥ (88,788)
¥3,410,410
26,274
46,477
24,769
11,573
25,821
6,393
141,307
143
39,449
—
55,824
—
19,706
2,404
13,732
1,212
27,869
558
6,913
4,317
163,493
—
—
—
141,307
4,317
163,493
U.S. dollars (thousands)
As of and for the year ended March 31, 2015
I Net sales and
operating income
Sales:
(1) External customers
(2) Intersegment
Net sales
Operating costs
Operating income
II Assets, depreciation
and amortization,
loss on impairment of
long-lived assets, and
capital expenditures
Assets
Depreciation and
amortization
Loss on impairment of
long-lived assets
Capital expenditures
Energy and
Electric Systems
Industrial
Automation
Systems
Information and
Communication
Systems
Electronic
Devices
Home
Appliances
Others
Subtotal
Eliminations
and other
Total
$10,166,525 $10,573,817
115,758
10,689,575
9,473,058
$ 603,733 $ 1,216,517
74,792
10,241,317
9,637,584
$4,340,442 $1,743,625
243,058
1,986,683
1,735,325
$ 157,783 $ 251,358
322,233
4,662,675
4,504,892
$7,708,366 $1,492,567 $36,025,342 $ — $36,025,342
—
5,599,466
36,025,342
41,624,808
33,378,642
38,745,100
$ 452,467 $ 197,850 $ 2,879,708 $ (233,008) $ 2,646,700
(5,599,466)
(5,599,466)
(5,366,458)
4,678,408
6,170,975
5,973,125
165,217
7,873,583
7,421,116
$10,838,175 $ 8,871,333
$3,197,433 $1,724,843
$6,415,825 $2,051,133 $33,098,742 $ 730,016
$33,828,758
242,134
473,683
198,450
217,125
255,042
52,008
1,438,442
4,683
295,833
217
566,192
17
153,192
1,691
320,050
14,500
388,316
4,600
69,850
25,708
1,793,433
—
—
—
1,438,442
25,708
1,793,433
Notes: 1 The amount of unallocatable R&D expenditure included in “Eliminations and other” on “Operating costs” for the years ended March 31, 2015, 2014 and
2013 are ¥27,961 million ($233,008 thousand), ¥27,489 million and ¥27,738 million, respectively.
2 The amount of company-wide shared assets included in “Eliminations and other” on “Assets” for the years ended March 31, 2015, 2014 and 2013 are
¥309,521 million ($2,579,342 thousand), ¥197,227 million and ¥126,212 million, respectively, and those amounts are mainly the Company’s deposit in
bank.
MITSUBISHI ELECTRIC CORPORATION ANNUAL REPORT 2015 71
Geographical Information
Sales to external customers by the location of customers, and long-lived assets by the location of the Company and its subsidiar-
ies as of and for the years ended March 31, 2015, 2014 and 2013 are as follows:
As of and for the year ended March 31, 2015
Yen (millions)
Overseas
Sales to external customers
% of total net sales
Long-lived assets
Japan
¥2,512,357
North
America
¥398,501
Asia
(excluding
Japan)
¥959,540
Europe
¥360,668
Others
¥91,975
Overseas total
¥1,810,684
Consolidated
total
¥4,323,041
58.1%
9.2%
22.2%
8.4%
542,524
55,757
144,669
24,391
2.1%
3,611
41.9%
228,428
100.0%
770,952
As of and for the year ended March 31, 2014
Yen (millions)
Overseas
Sales to external customers
% of total net sales
Long-lived assets
Japan
¥2,480,369
North
America
¥330,861
Asia
(excluding
Japan)
¥811,081
61.2%
8.2%
20.0%
534,521
39,831
109,774
Europe
¥340,611
8.4%
17,426
Others
¥91,437
Overseas total
¥1,573,990
Consolidated
total
¥4,054,359
2.2%
3,742
38.8%
170,773
100.0%
705,294
As of and for the year ended March 31, 2013
Sales to external customers
% of total net sales
Long-lived assets
Japan
¥2,335,713
65.5%
516,568
North
America
¥262,706
7.4%
27,663
Asia
(excluding
Japan)
¥604,335
16.9%
90,798
Europe
¥280,126
7.8%
14,160
Others
¥84,304
Overseas total
¥1,231,471
2.4%
2,692
34.5%
135,313
Overseas
Yen (millions)
Consolidated
total
¥3,567,184
100.0%
651,881
As of and for the year ended March 31, 2015
U.S. dollars (thousands)
Overseas
Sales to external customers
% of total net sales
Long-lived assets
Japan
$20,936,308
North
America
$3,320,842
Asia
(excluding
Japan)
$7,996,167
Europe
$3,005,567
Others
$766,458
Overseas total
$15,089,034
Consolidated
total
$36,025,342
58.1%
9.2%
22.2%
8.4%
2.1%
41.9%
100.0%
4,521,033
464,642
1,205,575
203,258
30,092
1,903,567
6,424,600
Notes: The major countries and regions included in each segments are as follows:
(1) North America : United States, Canada, and Mexico
(2) Asia (excluding Japan) : China, South Korea, Thailand, Malaysia, Singapore, Indonesia, and India
(3) Europe : United Kingdom, France, Germany, the Netherlands, Spain, Italy, and Czech
In addition to the disclosure requirement of FASB ASC Topic 280 “Segment Reporting”, the Company discloses the following
information as supplement.
Geographical Information Based on the Location of the Company and Its Subsidiaries
As of and for the year ended March 31, 2015
Yen (millions)
Japan
North
America
Asia
(excluding
Japan)
Europe
Others
Subtotal
Eliminations
and other
Total
I Net sales and
operating income
Sales:
(1) External customers
(2) Intersegment
Net sales
Operating costs
Operating income
II Assets
¥2,782,686
796,274
3,578,960
3,352,761
¥ 226,199
¥2,809,868
¥364,686
23,335
388,021
382,843
¥ 5,178
¥304,311
¥ 755,081
292,677
1,047,758
965,339
¥ 82,419
¥ 872,163
¥371,235
12,730
383,965
372,162
¥ 11,803
¥248,599
¥49,353
142
49,495
49,093
¥ 402
¥45,607
¥4,323,041
1,125,158
5,448,199
5,122,198
¥ 326,001
¥4,280,548
¥ —
(1,125,158)
(1,125,158)
(1,116,761)
¥ (8,397)
¥ (221,097)
¥4,323,041
—
4,323,041
4,005,437
¥ 317,604
¥4,059,451
72 MITSUBISHI ELECTRIC CORPORATION ANNUAL REPORT 2015
As of and for the year ended March 31, 2014
Yen (millions)
Japan
North
America
Asia
(excluding
Japan)
Europe
Others
Subtotal
Eliminations
and other
Total
I Net sales and
operating income
Sales:
(1) External customers
(2) Intersegment
Net sales
Operating costs
Operating income
II Assets
¥2,719,567
643,287
3,362,854
3,185,539
¥ 177,315
¥2,637,710
¥306,537
18,687
325,224
323,545
¥ 1,679
¥254,978
¥638,518
248,504
887,022
827,999
¥ 59,023
¥673,309
¥342,072
10,878
352,950
348,182
¥ 4,768
¥233,252
¥47,665
159
47,824
46,089
¥ 1,735
¥39,884
¥4,054,359
921,515
4,975,874
4,731,354
¥ 244,520
¥3,839,133
¥ — ¥4,054,359
—
4,054,359
3,819,187
¥ 235,172
¥3,612,966
(921,515)
(921,515)
(912,167)
¥ (9,348)
¥(226,167)
As of and for the year ended March 31, 2013
Yen (millions)
Japan
North
America
Asia
(excluding
Japan)
Europe
Others
Subtotal
Eliminations
and other
Total
I Net sales and
operating income
Sales:
(1) External customers
(2) Intersegment
Net sales
Operating costs
Operating income (loss)
II Assets
¥2,561,242
502,772
3,064,014
2,947,091
¥ 116,923
¥2,594,608
¥233,548
14,557
248,105
249,849
¥ (1,744)
¥210,356
¥450,791
173,933
624,724
588,552
¥ 36,172
¥559,138
¥281,400
8,533
289,933
285,406
¥ 4,527
¥184,872
¥40,203
52
40,255
38,046
¥ 2,209
¥34,043
¥3,567,184
699,847
4,267,031
4,108,944
¥ 158,087
¥3,583,017
¥ — ¥3,567,184
—
(699,847)
3,567,184
(699,847)
3,415,089
(693,855)
¥ 152,095
¥ (5,992)
¥3,410,410
¥(172,607)
As of and for the year ended March 31, 2015
Japan
North
America
Asia
(excluding
Japan)
Europe
Others
Subtotal
U.S. dollars (thousands)
Eliminations
and other
Total
I Net sales and
operating income
Sales:
(1) External customers
(2) Intersegment
Net sales
Operating costs
Operating income
II Assets
6,635,617
29,824,667
27,939,675
$23,189,050 $3,039,050 $6,292,342 $3,093,625 $411,275 $36,025,342 $ — $36,025,342
—
36,025,342
33,378,642
$ 1,884,992 $ 43,150 $ 686,825 $ 98,358 $ 3,350 $ 2,716,675 $ (69,975) $ 2,646,700
$23,415,567 $2,535,925 $7,268,025 $2,071,658 $380,058 $35,671,233 $(1,842,475) $33,828,758
(9,376,316)
(9,376,316)
(9,306,341)
9,376,316
45,401,658
42,684,983
194,458
3,233,508
3,190,358
2,438,975
8,731,317
8,044,492
106,083
3,199,708
3,101,350
1,183
412,458
409,108
Notes: 1 The Company has identified 5 location segments based on geographical proximity, similarity in market, and interconnectedness within business activities.
2 The major countries and regions included in each segments are as follows:
(1) North America : United States, Canada, and Mexico
(2) Asia (excluding Japan) : China, South Korea, Thailand, Malaysia, Singapore, Indonesia, and India
(3) Europe : United Kingdom, France, Germany, the Netherlands, Spain, Italy, and Czech
3 The amount of company-wide shared assets included in “Eliminations and other” on “Assets” for the years ended March 31, 2015, 2014 and 2013 is
¥309,521 million ($2,579,342 thousand), ¥197,227 million and ¥126,212 million, respectively, and those amounts are mainly the Company’s deposit in
bank.
(23) SUBSEQUENT EVENT
On June 26, 2015, the date the consolidated financial statements were issued, there are no incidence of subsequent events that
would have material effects on the Company’s consolidated financial position and results of operations.
MITSUBISHI ELECTRIC CORPORATION ANNUAL REPORT 2015 73
Independent Auditors’ Report
74 MITSUBISHI ELECTRIC CORPORATION ANNUAL REPORT 2015
Corporate Data / Shareholder Information (As of March 31, 2015)
Corporate Data
Mitsubishi Electric Corporation
Tokyo Building, 2-7-3, Marunouchi,
Chiyoda-ku, Tokyo 100-8310, Japan
Tel: +81(3)3218-2111
Established: January 15, 1921
Paid-in Capital: ¥175,820 million
Shares issued: 2,147,201,551 shares
Employees: 129,249
Major Shareholders
The Master Trust Bank of Japan, Ltd. (Trust Account)
Japan Trustee Services Bank, Ltd. (Trust Account)
Meiji Yasuda Life Insurance Company
State Street Bank and Trust Company
Nippon Life Insurance Company
Mitsubishi Electric Group Employees Shareholding Union
The Bank of Tokyo-Mitsubishi UFJ, Ltd.
The Bank of New York Mellon SA/NV 10
Japan Trustee Services Bank, Ltd. (Trust Account 4)
State Street Bank West Client—Treaty 505234
Annual Meeting
The annual meeting of shareholders of the Corporation is regularly
held in June each year. Additionally, special shareholders meetings
may be held as necessary.
Stock Exchange Listings
Japan: Tokyo
Europe: London
Number of Shares
(thousands)
Percentage of
Ownership
150,017
88,748
81,862
68,109
61,639
44,610
36,822
34,894
33,592
26,228
7.0%
4.1%
3.8%
3.2%
2.9%
2.1%
1.7%
1.6%
1.6%
1.2%
Distribution of Shareholders
Other Corporations
6.4%
Traders of Financial Instruments
1.5%
Foreign Corporations
37.4%
Financial Institutions 40.9%
Individuals and Others 13.8%
Stock Price (Yen)
2,000
1,600
1,200
800
400
0
’12/4
Mitsubishi Electric’s Stock Price
Nikkei Stock Average
’13/4
’14/4
The Nikkei Stock Average is based on information copyrighted by Nihon Keizai Shimbun, Inc.
20,000
15,000
10,000
5,000
’15/4
Nikkei Stock Average
(Yen)
MITSUBISHI ELECTRIC CORPORATION ANNUAL REPORT 2015 75
Please address inquiries for further information to:
Mitsubishi Electric Corporation, Corporate Finance Div.
Tokyo Building, 2-7-3, Marunouchi, Chiyoda-ku, Tokyo 100-8310, Japan
Phone: 81-3-3218-2391
X-X01-5-C9584-A HQ 1507〈IP〉