AnnuAl RepoRt 2011
Kyushu Electric Power Company
Financial Highlights
Consolidated Financial Summary
Years Ended March 3120072011
1,601円.6 billion
3月期売上高
1,636円.6 billion
3月期売上高
1,675円.1 billion
3月期売上高
1,625円.9 billion
3月期売上高
1,540円.8 billion
3月期売上高201020092008Other 26円.0 billion
IT and Telecommunications 96円.2 billion
Energy-related Business 158円.0 billion
Electric Power 1,356円.3 billion
Segment Information (before eliminating internal transactions)
Operating Revenues Revenue Share by Segment2*1 Shareholders’ Equity = Equity - Minority Interests
*2 ROA = After-tax Operating Income/Average Total Assets at beginning and ending of the Fiscal Year
*3 ROE = Net Income/Average Equity at beginning and ending of the Fiscal Year
*4 The figures under one billion are rounded down.
(U.S. dollar amounts have been translated from yen, for convenience, at the rate of 83円.15=U.S.1,ドル the approximate rate of exchange at March 31, 2011.)
(Million of U.S. Dollars)
For the year (Billions of Yen) 2011 2010 2009 2008 2007 2011
Operating Revenues \ 1,486.0 \ 1,444.9 \ 1,524.1 \ 1,482.3 \ 1,408.3 17,872ドル
Operating Income 98.9 99.7 84.7 105.5 155.1 1,189
Net Income 28.7 41.8 33.9 41.7 65.9 345
Electricity Sales Volume (Millions of kWh) 87,474 83,392 85,883 88,082 84,399
General Demand (Millions of kWh) 63,636 60,985 61,859 62,873 60,706
Large Industrial (Millions of kWh) 23,838 22,407 24,024 25,209 23,693
At year-end (Billions of Yen)
Total Assets 4,185.4 4,054.1 4,110.8 4,059.7 4,038.8 50,336
Shareholders’ Equity*1
1,062.4 1,071.7 1,054.7 1,067.0 1,081.6 12,777
Interest-bearing Debt 2,089.4 2,004.7 2,110.6 2,040.0 2,031.7 25,128
Per share of common stock
Net Income (yen and U.S. dollars) 60.73 88.38 71.84 88.19 139.37 0.73
Cash Dividends (yen and U.S. dollars) 60.00 60.00 60.00 60.00 60.00 0.72
Financial ratios (%)
ROA*2
1.5 1.6 1.3 1.7 2.4
ROE*3
2.7 3.9 3.2 3.9 6.2
Equity Ratio 25.4 26.4 25.7 26.3 26.8
Electric Power83%Energy-related Business10%Other1%IT and Telecommunications6%Operating
Revenues
(2011)
1,636.6
billion
billion
Operating Revenues Operating Income Net Income
Earnings per Share (EPS) Return on Assets (ROA)
Interest-bearing Debt Debt/Equity Ratio
Return on Equity (ROE)500100150200’07 ’08 ’09 ’10
155.1
105.584.799.7
(Billions of Yen)
’1198.9200406080
’07 ’08 ’09 ’1065.941.733.941.8
(Billions of Yen)
’1128.7’07 ’08 ’09 ’10
1,408.3
1,482.3
1,524.1
1,444.9
’11
1,486.0
2,000
(Billions of Yen)5000
1,000
1,50020468’07 ’08 ’09 ’106.23.93.23.9
’112.7(%)10234’07 ’08 ’09 ’102.41.71.31.6(%)’111.5500100150’07 ’08 ’09 ’10
139.37
88.19
71.84
88.38
’11
60.73
(Yen)
’07 ’08 ’09 ’10
1,081.6
1,067.0
1,054.7
1,071.726.826.325.726.4
1,200
1,000
(Billions of Yen)2000400600800(%)
’11
1,062.425.4201030405060’07 ’08 ’09 ’10
187.84
191.19
200.11
187.05300(%)500150100200250
’11
196.66
’07 ’08 ’09 ’10
2,031.7
2,040.0
2,110.6
2,004.7
2,500
(Billions of Yen) 5000
1,000
1,500
2,000
’11
2,089.4
Shareholders’ Equity/Equity Ratio1Composition of Power Output and Supply Capacity Nuclear Power Utilization Rate Solar Power and Wind Power Facilities Installation Capacity
CO2 Emissions, and CO2 Emission Intensity Output in the Overseas Power Generation Business
Capital Expenditure BBIQ Broadband Contracts
Spread of All-electric Housing05060708090100’07 ’08 ’09 ’1082.185.8 84.6 84.8
’1181.169.9
60.7 60.065.767.3(%)0501002731 33415621253035485663764096
(10 thousand kW)
’07 ’08 ’09 ’10 ’11200
’07 ’11 ’07 ’11406080100200406080100
(%) (%)717262614171927152392420191132323191811623
’07 ’08 ’09 ’103516.78.510.011.212.5442525598674711141722343031,000800(Thousands) (%)0200400600
’115010153006090120150
’07 ’08 ’09 ’107878
128 129
’11150(10 thousand kW)
’07 ’08 ’09 ’1084.488.185.983.4
’1187.50.375
0.387
0.348
[0.374]
0.348
[0.369]
0.348
[0.385]
3,160
3,410
[3,210]
[3,080]
[3,370]
2,990
2,910
3,0500100200300400’07
161.2
’08 ’09 ’10 ’11
165.9
172.8
175.3
155.2
170.7
184.9
197.8
195.1
175.9
331.9
350.8
370.6 370.4
331.1
(Billions of Yen)1020300
’07 ’08 ’09 ’1021.515.526.028.4
’1129.9(10 thousands)050100150200250
’0759.8’08 ’09 ’10 ’11
65.0 67.5 63.8 59.466.980.5
93.7 98.454.769.171.658.898.778.8
181.4
214.6
232.8
221.0
236.9
(Billions of Yen)
nuclear other renewable energy Hydroelectric
Geothermal Coal lnG oil, etc.
electricity sales volume (Billions kWh)
Co2 emissions (10 thousand t-Co2)
Co2 emission intensity (kg-Co2/kWh)
[ ]=emissions before Co2 credits
total number of all-electric houses
total number of ecoCute systems
penetration rate of all-electric households
Kyushu electric power ten company average Wind power Solar power
(Supply Capacity)
(power output)
power source Distribution others Maintenance costs Miscellaneous costs
Major operating Data
Maintenance and Miscellaneous Costs
Years Ended March 31
Contents
Major Operating Data ........................................................ 1
Financial Highlights............................................................ 2
Financial Information
Consolidated Eleven-Year Financial Summary .............. 4
Management Discussion and Analysis .......................... 4
Business Risk Factors.................................................. 8
Consolidated Balance Sheets .................................... 10
Consolidated Statements of Income........................... 12
Consolidated Statement of Comprehensive Income.... 13
Consolidated Statements of Changes in Equity .......... 14
Consolidated Statements of Cash Flows.................... 15
Notes to Consolidated Financial Statements............... 16
Independent Auditors’ Report..................................... 32
Non-consolidated Five-Year Financial Summary.......... 33
Non-consolidated Balance Sheets.............................. 34
Non-consolidated Statements of Income..................... 36
Overview of Power Generation Facilities .................... 37
Subsidiaries and Affiliated Companies........................ 38
Outline of Kyushu Electric Power’s History ...................... 40
Corporate Data................................................................ 41
(Cover: Solar panels in the Omuta mega solar power plant.) 3
For the Year: 2001 2002 2003 2004 2005
Operating revenues \ 1,448,376 \ 1,458,066 \ 1,421,310 \ 1,391,684 \ 1,408,728
Electric 1,410,010 1,381,440 1,350,675 1,308,843 1,320,581
Other 38,366 76,626 70,635 82,841 88,147
Operating expenses 1,236,344 1,260,308 1,241,296 1,192,718 1,194,993
Electric 1,199,237 1,184,382 1,170,655 1,108,104 1,107,744
Other 37,107 75,926 70,641 84,614 87,249
Interest charges 89,952 85,653 77,897 77,121 49,522
Income before income taxes and
minority interests
97,447 99,464 102,363 112,451 146,797
Income taxes 37,595 39,808 38,417 39,086 57,858
Net income 59,191 61,120 64,319 72,792 89,288
Per share of common stock
(yen and U.S. dollars):
Net income:
Basic \ 124.83 \ 128.90 \ 135.13 \ 153.05 \ 187.91
Diluted 123.65 — — — —
Cash dividends applicable to the year 60.00 60.00 50.00 50.00 60.00
At year-end:
Total assets \ 4,166,489 \ 4,290,132 \ 4,204,566 \ 4,114,378 \ 4,049,713
Net property 3,459,859 3,595,794 3,523,273 3,394,855 3,300,740
Long-term debt, less current portion 2,071,192 2,130,149 1,984,702 1,858,512 1,739,660
Equity 810,018 824,928 840,245 910,838 979,252
Summary
Despite a growth in sales, profits declined, following the growth in the previous year.
· In the electricity business:
— Electricity sales increased due to higher electricity sales volume and other factors.
— Despite reduction of maintenance costs and overhead due to streamlining efforts in all areas of management, fuel costs
increased due to electricity sales volume and higher fuel prices.
— An extraordinary loss was recorded due to the application of the Accounting Standard for Asset Retirement Obligations.
FInancIal InFormatIon
Management Discussion and Analysis
operating results
In the year ended March 31, 2011 (fiscal 2010), Kyushu Electric Power recorded
a 2.8% year-on-year increase in consolidated operating revenues to 1,486円.0
billion as a result of an increase in electricity sales volume in the electricity
business, despite lower sales from the energy-related business.
With regard to expenditures, operating expenses increased by 3.1% to
1,387円.1 billion due to higher fuel costs in the electric business resulting from the
increase in electricity sales volume and higher fuel prices, despite lower
maintenance costs. As a result, operating income fell by 0.8% to 98円.9 billion.
Consolidated Eleven-Year Financial Summary
Kyushu Electric Power Company, Incorporated and Consolidated Subsidiaries
Years Ended March 31,40
30,000
20,000
10,000
50,000
70,000
40,000
60,000013,000
12,000
11,000
15,000
17,000
14,000
16,000
54,632
55,334
56,318
20,318
15,365
16,362
15,346
15,560
16,094
15,890
16,807 16,934 16,978
20,619
19,993
56,684
58,982
60,765
60,706
62,873
25,209
61,859
20,584
21,217
22,191
23,693
16,013
60,985
22,407
24,024
’01 ’02 ’03 ’04 ’05 ’06 ’07 ’08 ’09 ’10 ’11
16,760
63,636
23,83803009001,5006001,200020601004080
’07 ’08 ’09 ’10
1,408.3
1,482.365.941.7
1,524.133.91,444.941.8’11
1,486.028.7(Billions of Yen)
Operating Revenues (Left) Net Income (Right)050150200100’07 ’08 ’09 ’10
155.1
105.5
118.572.384.750.499.767.6’1198.966.7
(Billions of Yen)
Operating Income Ordinary Income
(Millions of kWh) (Thousands of kW)
Peak Load (Right) General Demand (Left) Large-scale Industrial (Left)
Electricity Sales Volume (Millions of kWh) and Peak load (Thousands of kW)
Millions of Yen
(except for per share data)
Thousands of U.S. Dollars
(except for per share data)
2006 2007 2008 2009 2010 2011 2011
\ 1,401,752 \ 1,408,328 \ 1,482,352 \ 1,524,193 \ 1,444,941 \ 1,486,083 $ 17,872,315
1,311,996 1,307,737 1,363,424 1,398,577 1,310,085 1,354,204 16,286,278
89,756 100,591 118,928 125,616 134,856 131,879 1,586,037
1,230,467 1,253,155 1,376,811 1,439,470 1,345,214 1,387,174 16,682,790
1,140,797 1,155,414 1,260,616 1,317,216 1,220,537 1,261,426 15,170,487
89,670 97,741 116,195 122,254 124,677 125,748 1,512,303
41,130 38,354 36,938 35,771 35,292 34,026 409,213
120,790 112,887 72,463 55,859 67,610 48,319 581,106
43,038 46,075 29,853 21,481 25,405 19,246 231,461
76,850 65,968 41,727 33,992 41,813 28,730 345,520
\ 161.67 \ 139.37 \ 88.19 \ 71.84 \ 88.38 \ 60.73 $ 0.73
— — — — — — —
60.00 60.00 60.00 60.00 60.00 60.00 0.72
\ 4,102,319 \ 4,038,839 \ 4,059,775 \ 4,110,878 \ 4,054,192 \ 4,185,461 $ 50,336,272
3,217,982 3,140,200 3,109,293 3,080,447 3,037,055 3,033,125 36,477,751
1,724,179 1,689,107 1,712,949 1,811,744 1,724,973 1,714,430 20,618,521
1,052,785 1,092,601 1,084,213 1,072,375 1,089,066 1,079,679 12,984,714
(U.S. dollar amounts have been translated from yen, for convenience, at the rate of 83円.15 = U.S. 1,ドル the approximate rate of exchange at March 31, 2011.)
Other revenues rose by 7.8% from the previous year to 12円.2 billion. The
revenue increase is attributable to an increase in the gain on sales of investment
securities, despite lower proceeds from dividends and investment returns from equity
method affiliates. Other expenses rose by 2.1% year on year to 44円.3 billion.
As a result, ordinary revenues rose by 2.9% from the previous year to
1,498円.2 billion, and ordinary expenses rose by 3.1% to 1,431円.5 billion, resulting
in a 1.3% year-on-year decrease in ordinary income to 66円.7 billion, following an
increase in the previous year.50300900
1,5006001,20004012020080160
’09 ’10
’07 ’08
1,310.194.31,365.774.11,400.7
144.282.91,312.186.51,356.3
’11
Sales (Left) Operating Income (Right)
Electric Power (Billions of Yen)08016040120036129
’09 ’10
’07 ’08
128.38.5147.07.5157.26.87.4
163.83.0158.0
’11
Sales (Left) Operating Income (Right)
Energy-related Business (Billions of Yen)-20200601004080-20261048
’09 ’10
’07 ’0876.4-1.60.788.492.7-1.36.399.16.496.2
’11
Sales (Left) Operating Income (Right)
It and telecommunications (Billions of Yen)
Electric Power (Left) Other (Right)03009001,5006001,2000309015060120
’01 ’02 ’03 ’04 ’05 ’06 ’07 ’08 ’09 ’10
1,410.0
1,381.4
1,350.670.638.376.61,308.8
1,320.5
1,311.9
1,307.7
1,363.4
118.9
1,398.5
125.682.888.189.7105.0
1,310.0
134.8
’11
1,354.2
131.8
trends of operating revenues by Segments (after eliminating internal transactions) (Billions of Yen)
Net income fell by 31.3% from the previous year to 28円.7 billion as a result of
the recording of an extraordinary loss of 18円.4 billion due to the application of the
Accounting Standard for Asset Retirement Obligations. Net earnings per share fell
27円.65 to 60円.73.
Segment Information (Before Elimination of Internal transactions)
(1) Electric Power
Electricity sales volume rose by 4.3% from the previous year due to an increase in
general demand, including domestic lighting and commercial demand, as a result
of factors including higher air conditioning demand caused by higher temperatures
in summer and lower temperatures in winter than the previous year. Large-scale
industrial demand rose by 6.4% due to increased production of iron and steel,
chemicals, non-ferrous metals and other industrial products. As a result, total sales
volume rose by 4.9% year on year to 87.47 billion kWh.
On the supply side, our nuclear power stations and other power generation
facilities continued to operate steadily, allowing us to maintain reliable sources of
electric power. Analysis of the energy mix, including power generated by Kyushu
Electric Power and power purchased from other companies, shows nuclear power
to account for 39%, thermal power for 52%, hydroelectric for 6% and new energy
sources for 3% of total power.
For the electric power segment, operating revenues rose by 3.4% from the
previous year to 1,356円.3 billion, due to an increase in electricity sales volume,
despite lower charge unit prices resulting from the impact of fuel cost adjustment
and other factors. Operating income rose by 4.4% year on year to 86円.5 billion due
to streamlining efforts in all areas of management, including maintenance costs.
(2) Energy-Related Business
Operating revenues in the energy-related segment fell by 3.5% year on year to
158円.0 billion, owing to a decrease in sales from completed power plant construction
projects and maintenance work. Operating income fell by 59.2% from the previous
year to 3円.0 billion, mainly due to the impact of higher LNG purchase prices.
(3) IT and Telecommunications
Operating revenues fell by 3.0% year on year to 96円.2 billion. The lower
revenues are attributable to factors including a decrease in large-lot IT system
development, despite increases in the number of broadband service lines under
contract and telecommunications construction work. Operating income rose by
1.9% to 6円.4 billion as a result of factors including cost reductions.6(4) Other
Operating revenues from other business fell by 1.7% year on year to 26円.0 billion
on lower revenues from real estate sales, despite an increase in revenues from the
opening of condominiums for senior citizens in new areas. Operating income rose
by 5.1% to 3円.3 billion as a result of factors including cost reductions.
Financial Position
(1) Cash Flows
Cash flows from operating activities decreased by 14.3% from the previous year to
301円.3 billion due to factors including an increase in fuel costs, which offset an
increase in electricity sales revenue in the electricity business.
Cash flows for investment activities increased by 25.8% from the previous year
to 296円.0 billion. The increase is attributable to factors including higher capital
expenditures and payments for the acquisition of investment securities.
Cash flows for financing activities was 52円.9 billion (compared to 135円.9 billion
in cash used the previous year).
As a result of the above, cash and cash equivalents on March 31, 2011 stood
at 125円.9 billion, an increase of 57円.8 billion from the end of the previous year.
(2) Assets, Liabilities and Net Assets
Total assets at the end of the year in review were 4,185円.4 billion, an increase of
3.2% from the end of the previous year. The increase is attributable to higher fixed
assets resulting from increases in the reserve for reprocessing of irradiated nuclear
fuel and long-term investments and to higher current assets, such as cash and
cash equivalents.
Total liabilities at the end of the year under review were 3,105円.7 billion, an
increase of 4.7% from the end of the previous year. The increase is attributable
to factors including higher interest-bearing debt and the recording of asset
retirement obligations. Outstanding interest-bearing debt increased 84円.6 billion
to 2,089円.4 billion.
Net assets fell by 0.9% from the end of the previous year to 1,079円.6 billion
due to the payment of cash dividends and a decrease in the unrealized gain on
available-for-sale securities, despite the recording of net income. The equity ratio
was 25.4%.01030200264
’09 ’10
’07 ’0825.93.424.81.624.44.23.226.53.326.0
’11
Sales (Left) Operating Income (Right)
other activities (Billions of Yen)02684’07 ’08 ’10
’09 ’116.23.93.23.92.7roE (%)0123
’07 ’08 ’10
’09 ’112.41.71.31.61.5roa (%)
Total Assets (Left) Interest-bearing Debt (Left) Shareholders’ Equity (Left) Equity Ratio (Right)01,000
3,000
5,000
2,000
4,0000618301224
’01 ’02 ’03 ’04 ’05 ’06 ’07 ’08 ’09 ’10
4,166.4
4,290.1
4,204.5
2,503.7
2,603.9
2,699.6
4,114.3
4,049.7
4,102.3
4,038.8
4,059.7
2,040.0
2,336.2
2,139.4
2,104.9
2,031.7
840.2
810.0
824.9
1,067.0
4,110.8
2,110.6
1,054.7
910.8
979.2
1,052.7
1,081.6
19.4 19.220.022.124.225.7
26.8 26.3 25.7
4,054.1
2,004.7
1,071.726.4’11
4,185.4
2,089.4
1,062.425.4consolidated Interest-bearing Debt and Equity ratio (Billions of Yen, %)7Business Risk Factors1Economic conditions and Weather conditions
The sales volume in the electric power business reflects economic conditions and seasonal changes in temperatures.
These factors may have a material impact on the results and financial condition of the Kyushu Electric Power Group.2Fuel Price Fluctuations
Fuel expenses in electricity business fluctuate as a result of trends in CIF prices and in the foreign exchange
markets because we procure sources of fuel for thermal power generation including liquefied natural gas (LNG)
and coal from overseas.
However, fluctuations in fuel prices are reflected in electric rates through the fuel cost adjustment system, which
in our opinion helps to limit the impact of fuel price volatility on the Kyushu Electric Power Group.3nuclear Fuel cycle costs
The uncertainties in the long-term prospects of nuclear fuel cycle operations pose a risk, but operator risk is being
reduced through measures proposed by the Japanese government. However, Group performance could be affected
by the burden of increased costs based on revised cost estimates for future expenses.4cost of measures to combat Global Warming
The Kyushu Electric Power Group is undertaking numerous measures to combat global warming. One key measure
is to maintain a high utilization rate as a result of nuclear power safety and stable operations. Other initiatives include
maintenance and enhancement of thermal power efficiency, reduced losses in the transmission network and the
active development and introduction of renewable power. However, Group performance may be affected by the
increased cost burden from policy trends related to global warming.5Businesses other than Electricity
The Kyushu Electric Power Group is enhancing its revenue basis by utilizing the group’s management resources
and steadly developing new business area beyond electricity business. In the business operation, we put emphasis
on the profitability and work to improve efficiency while pursuing the growth. In case securing the planned profits
cannot be achieved due to the worsening business conditions, the Kyushu Electric Power Group’s performance
may be affected.6Interest rate Fluctuations
The Kyushu Electric Power Group’s balance of interest-bearing debt as of the end of March 2011 is 2,089円.4
billion, which accounts for 50% of total assets of the group. Future changes in interest rates have potential to affect
the Kyushu Electric Power Group’s financial condition.
However, 93% of outstanding interest-bearing debt comprises long-term debt, and most of these bear interest at
fixed rates. The impact of fluctuating interest rates on Kyushu Electric Power Group is therefore viewed as limited.
The following is a list of some significant risk factors that may have an effect on the operating results, financial
position and other aspects of the Group (consolidated).
Forward-looking statements in this report reflect the judgment of the Company as of June 28, 2011 and may be
affected by factors including change in the economic situation due to the Great East Japan Earthquake or the
Japanese government’s review of energy policy following the accident at the Tokyo Electric Power Company
Fukushima Daiichi Nuclear Power Station.87
leakage of Information
The Kyushu Electric Power Group has established strict internal frameworks to manage in-house information and
personal information, which Group companies hold, to ensure information security. Additionally, we have
implemented thorough information management by establishing internal policies and guidelines on handling
information as well as familiarizing employees with the handling procedures. However, in case of the leaking of in-
house information and personal information, the Kyushu Electric Power Group’s operation may be affected.8natural Disasters
To ensure a stable supply of electricity to our customers, the Kyushu Electric Power Group implements inspection
and maintenance of the facilities systematically to prevent any trouble from occurring. However, large-scaled natural
disasters such as typhoons, torrential rains and earthquakes or tsunami as well as unexpected accidents and illicit
acts have the potential to affect the Kyushu Electric Power Group’s operations.
In light of the accident at the Tokyo Electric Power Company Fukushima No. 1 Nuclear Power Station, the
Company has implemented emergency safety measures and other measures to increase the safety of its nuclear
power stations in accordance with instructions from the government of Japan. The government has indicated that
these measures have been appropriately implemented. The Company will continue to implement safety measures
to ensure nuclear power plant safety and will promptly and appropriately reflect any newly obtained knowledge in
these measures.
We are also developing a risk management system and are preparing for numerous risks that may have a material
impact on business operations. Improper actions taken in response to an emergency situation may adversely affect
the Kyushu Electric Power Group’s business performance.9Decrease in the nuclear Power Utilization rate
A decrease in the nuclear power utilization rate due to comprehensive safety evaluation of nuclear power generation
facilities (stress testing), a review of the national government’s energy policy or any other reason may adversely
affect the Kyushu Electric Power Group’s business performance due to higher fuel costs or funding costs.10compliance
The Company has lost public trust due to compliance violations, such as recruiting positive opinions concerning
safety measures at the Genkai Nuclear Power Station for a television program viewed by residents of Saga
Prefecture in Kyushu and sponsored by the Ministry of Economy, Trade, and Industry. In response, the Company is
striving to promote awareness of the nature and importance of compliance, and executive management and all
employees are working to regain public trust. Nevertheless, any delay in restoring public trust may adversely affect
the Kyushu Electric Power Group’s business performance.
The Company has received instructions from the national government for comprehensive safety evaluation of
nuclear power generation facilities (stress testing) and will appropriately evaluate its nuclear power generation
facilities to further increase their safety and ensure the peace of mind and confidence of area residents.
In addition, in light of factors including the impact of a delay in the resumption of operation of nuclear power
facilities and the occurrence of compliance violations such as recruiting pro-nuclear opinions for a television
program aired for residents of Saga Prefecture in Kyushu, the Company decided on August 11, 2011 to release
two important additions to the above items previously posted on June 28, 2011, as follows:9Millions of Yen
Thousands of
U.S. Dollars (Note 1)
2011 2010 2011
ASSETS
PROPERTY (Note 3):
Plant and equipment \ 9,367,143 \ 9,213,586 $ 112,653,554
Construction in progress 247,837 247,078 2,980,601
Total 9,614,980 9,460,664 115,634,155
Less-
Contributions in aid of construction 157,208 150,818 1,890,655
Accumulated depreciation 6,424,647 6,272,791 77,265,749
Total 6,581,855 6,423,609 79,156,404
Net property 3,033,125 3,037,055 36,477,751
NUCLEAR FUEL 263,381 269,663 3,167,541
INVESTMENTS AND OTHER ASSETS:
Investment securities (Notes 4 and 15) 113,188 87,237 1,361,251
Investments in and advances to non-consolidated subsidiaries and
affiliated companies (Note 15)
98,106 75,946 1,179,868
Reserve funds for reprocessing of irradiated nuclear fuel (Notes 8 and 15) 197,273 167,770 2,372,495
Deferred tax assets (Note 11) 136,028 119,709 1,635,935
Other assets 14,523 18,851 174,660
Total investments and other assets 559,118 469,513 6,724,209
CURRENT ASSETS:
Cash and cash equivalents (Note 15) 125,989 68,178 1,515,201
Receivables (Note 15) 113,883 110,592 1,369,609
Allowance for doubtful accounts (975) (1,080) (11,726)
Inventories, principally fuel 58,621 63,846 705,003
Deferred tax assets (Note 11) 17,996 16,567 216,429
Prepaid expenses and other 14,323 19,858 172,255
Total current assets 329,837 277,961 3,966,771
TOTAL \ 4,185,461 \ 4,054,192 $ 50,336,272
See notes to consolidated financial statements.
Consolidated Balance Sheets
Kyushu Electric Power Company, Incorporated and Consolidated Subsidiaries
March 31, 2011 and 201010Millions of Yen
Thousands of
U.S. Dollars (Note 1)
2011 2010 2011
LIABILITIES AND EQUITY
LONG-TERM LIABILITIES:
Long-term debt, less current portion (Notes 6 and 15) \ 1,714,430 \ 1,724,973 $ 20,618,521
Liability for employees’ retirement benefits (Note 7) 144,687 141,699 1,740,072
Reserve for reprocessing of irradiated nuclear fuel (Note 8) 368,931 369,220 4,436,934
Reserve for decommissioning of nuclear power units (Note 9) 164,931
Asset retirement obligations (Note 9) 207,855 2,499,759
Other 39,486 32,081 474,877
Total long-term liabilities 2,475,389 2,432,904 29,770,163
CURRENT LIABILITIES:
Current portion of long-term debt (Notes 6 and 15) 232,082 174,799 2,791,124
Short-term borrowings (Notes 10 and 15) 120,771 111,887 1,452,447
Commercial paper (Note 15) 30,000 360,794
Notes and accounts payable (Notes 14 and 15) 117,302 99,838 1,410,728
Accrued income taxes (Note 15) 18,737 21,344 225,340
Accrued expenses 72,870 80,398 876,368
Other 38,631 43,956 464,594
Total current liabilities 630,393 532,222 7,581,395
COMMITMENTS AND CONTINGENCIES (Note 17)
EQUITY (Note 12):
Common stock, authorized, 1,000,000,000 shares; issued,
474,183,951 shares in 2011 and 2010
237,305 237,305 2,853,939
Capital surplus 31,138 31,141 374,480
Retained earnings 788,867 788,538 9,487,276
Treasury stock-at cost 1,202,882 shares in 2011 and
1,110,624 shares in 2010
(2,334) (2,165) (28,070)
Accumulated other comprehensive income
Unrealized gain on available-for-sale securities 11,356 16,383 136,572
Deferred gain (loss) on derivatives under hedge accounting (1,871) 1,880 (22,502)
Foreign currency translation adjustments (2,003) (1,290) (24,089)
Total 1,062,458 1,071,792 12,777,606
Minority interests 17,221 17,274 207,108
Total equity 1,079,679 1,089,066 12,984,714
TOTAL \ 4,185,461 \ 4,054,192 $ 50,336,27211Millions of Yen
Thousands of
U.S. Dollars (Note 1)
2011 2010 2011
OPERATING REVENUES:
Electric \ 1,354,204 \ 1,310,085 $ 16,286,278
Other 131,879 134,856 1,586,037
Total operating revenues 1,486,083 1,444,941 17,872,315
OPERATING EXPENSES (Note 13):
Electric 1,261,426 1,220,537 15,170,487
Other 125,748 124,677 1,512,303
Total operating expenses 1,387,174 1,345,214 16,682,790
OPERATING INCOME 98,909 99,727 1,189,525
OTHER EXPENSES (INCOME):
Interest charges 34,026 35,292 409,213
Gain on sales of investment securities (Note 4) (2,276) (37) (27,372)
Loss on adjustment for changes of
accounting standard for asset retirement obligations (Note 9)
18,429 221,636
Other-net 411 (3,138) 4,942
Total other expenses-net 50,590 32,117 608,419
INCOME BEFORE INCOME TAXES AND MINORITY INTERESTS 48,319 67,610 581,106
INCOME TAXES (Note 11):
Current 32,107 29,646 386,133
Deferred (12,861) (4,241) (154,672)
Total income taxes 19,246 25,405 231,461
NET INCOME BEFORE MINORITY INTERESTS 29,073 42,205 349,645
MINORITY INTERESTS IN NET INCOME OF
CONSOLIDATED SUBSIDIARIES
(343) (392) (4,125)
NET INCOME \ 28,730 \ 41,813 $ 345,520
Yen U.S. Dollars
PER SHARE OF COMMON STOCK (Note 2.s.):
Basic net income \ 60.73 \ 88.38 $ 0.73
Cash dividends applicable to the year 60.00 60.00 0.72
See notes to consolidated financial statements.
Consolidated Statements of Income
Kyushu Electric Power Company, Incorporated and Consolidated Subsidiaries
Years Ended March 31, 2011 and 201012Millions of Yen
Thousands of
U.S. Dollars (Note 1)
2011 2011
NET INCOME BEFORE MINORITY INTERESTS \ 29,073 $ 349,645
OTHER COMPREHENSIVE INCOME (Note 18):
Unrealized loss on available-for-sale securities (4,891) (58,821)
Deferred loss on derivatives under hedge accounting (3,752) (45,123)
Foreign currency translation adjustments (336) (4,041)
Share of other comprehensive income in non-consolidated subsidiaries and affiliated companies (523) (6,290)
Total other comprehensive income (9,502) (114,275)
COMPREHENSIVE INCOME (Note 18) 19,571 235,370
TOTAL COMPREHENSIVE INCOME ATTRIBUTABLE TO (Note 18):
Owners of the parent \ 19,238 $ 231,365
Minority interests 333 4,005
See notes to consolidated financial statements.
Consolidated Statement of Comprehensive Income
Kyushu Electric Power Company, Incorporated and Consolidated Subsidiaries
Years Ended March 31, 201113Thousands of U.S. Dollars (Note 1)
Common
Stock
Capital
Surplus
Retained
Earnings
Treasury
Stock
Accumulated other comprehensive income
Total
Minority
Interests
Total Equity
Unrealized
Gain on
Available-for-sale
Securities
Deferred Gain
(loss) on
Derivatives under
Hedge Accounting
Foreign Currency
Translation
Adjustments
BALANCE AT MARCH 31, 2010 $ 2,853,939 $ 374,516 $ 9,483,319 $ (26,037) $ 197,029 22,609ドル $ (15,514) $ 12,889,861 207,745ドル $ 13,097,606
Net income 345,520 345,520 345,520
Cash dividends, 0ドル.72 per share (341,563) (341,563) (341,563)
Purchase of treasury stock (2,213) (2,213) (2,213)
Disposal of treasury stock (36) 180 144 144
Net change in the year (60,457) (45,111) (8,575) (114,143) (637) (114,780)
BALANCE AT MARCH 31, 2011 $ 2,853,939 $ 374,480 $ 9,487,276 $ (28,070) $ 136,572 $ (22,502) $ (24,089) $ 12,777,606 207,108ドル $ 12,984,714
See notes to consolidated financial statements.
Thousands of Shares / Millions of Yen
Common Stock Treasury Stock Accumulated other comprehensive income
Shares Amount
Capital
Surplus
Retained
Earnings
Shares Amount
Unrealized
Gain on
Available-for-
sale Securities
Deferred Gain
(loss) on
Derivatives under
Hedge Accounting
Foreign
Currency
Translation
Adjustments
Total
Minority
Interests
Total Equity
BALANCE AT APRIL 1, 2009 474,184 \ 237,305 \ 31,147 \ 775,130 1,024 \ (2,000) \ 13,099 \ 1,393 \ (1,341) \ 1,054,733 \ 17,642 \ 1,072,375
Net income 41,813 41,813 41,813
Cash dividends, 60円 per share (28,405) (28,405) (28,405)
Purchase of treasury stock 101 (200) (200) (200)
Disposal of treasury stock (6) (14) 35 29 29
Net change in the year 3,284 487 51 3,822 (368) 3,454
BALANCE AT MARCH 31, 2010 474,184 237,305 31,141 788,538 1,111 (2,165) 16,383 1,880 (1,290) 1,071,792 17,274 1,089,066
Net income 28,730 28,730 28,730
Cash dividends, 60円 per share (28,401) (28,401) (28,401)
Purchase of treasury stock 98 (184) (184) (184)
Disposal of treasury stock (3) (6) 15 12 12
Net change in the year (5,027) (3,751) (713) (9,491) (53) (9,544)
BALANCE AT MARCH 31, 2011 474,184 \ 237,305 \ 31,138 \ 788,867 1,203 \ (2,334) \ 11,356 \ (1,871) \ (2,003) \ 1,062,458 \ 17,221 \ 1,079,679
Consolidated Statements of Changes in Equity
Kyushu Electric Power Company, Incorporated and Consolidated Subsidiaries
Years Ended March 31, 2011 and 201014See notes to consolidated financial statements.
Millions of Yen
Thousands of
U.S. Dollars (Note 1)
2011 2010 2011
CASH FLOWS FROM OPERATING ACTIVITIES:
Income before income taxes and minority interests \ 48,319 \ 67,610 $ 581,106
Adjustments for:
Income taxes-paid (34,741) (11,188) (417,811)
Depreciation and amortization 259,078 256,700 3,115,791
Decommissioning costs of nuclear power units 7,524 90,487
Provision for liability for employees’ retirement benefits 2,986 4,015 35,911
Provision for (reversal of) reserve for reprocessing of irradiated nuclear fuel (289) 2,783 (3,476)
Provision for reserve for decommissioning of nuclear power units 9,093
Loss on disposal of plant and equipment 8,436 8,953 101,455
Loss on adjustment for changes of
accounting standard for asset retirement obligations
18,429 221,636
Gain on sales of investment securities (2,276) (37) (27,372)
Changes in assets and liabilities, net of effects from
merger of a non-consolidated subsidiary with a consolidated subsidiary:
Increase in reserve funds for reprocessing of irradiated nuclear fuel (29,503) (31,758) (354,817)
Decrease (increase) in trade receivables (4,825) 16,249 (58,028)
Decrease in inventories 5,225 12,635 62,838
Increase in trade payables 9,148 2,173 110,018
Other-net 13,836 14,210 166,398
Total adjustments 253,028 283,828 3,043,030
Net cash provided by operating activities 301,347 351,438 3,624,136
CASH FLOWS FROM INVESTING ACTIVITIES:
Capital expenditures including nuclear fuel (243,750) (235,613) (2,931,449)
Payments for investments and advances (64,210) (13,296) (772,219)
Proceeds from sales of investment securities and collections of advances 8,547 9,451 102,790
Other-net 3,398 4,107 40,866
Net cash used in investing activities (296,015) (235,351) (3,560,012)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from issuance of bonds 129,574 59,803 1,558,317
Repayments of bonds (69,950) (50,000) (841,251)
Proceeds from long-term bank loans 88,830 25,230 1,068,310
Repayments of long-term bank loans (103,871) (119,324) (1,249,200)
Net increase (decrease) in short-term borrowings 8,884 (21,758) 106,843
Net increase in commercial paper 30,000 360,794
Cash dividends paid (28,413) (28,398) (341,708)
Other-net (2,111) (1,526) (25,388)
Net cash provided by (used in) financing activities 52,943 (135,973) 636,717
FOREIGN CURRENCY TRANSLATION ADJUSTMENTS ON
CASH AND CASH EQUIVALENTS
(485) (60) (5,833)
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS 57,790 (19,946) 695,008
CASH AND CASH EQUIVALENTS OF A NON-CONSOLIDATED
SUBSIDIARY MERGED WITH A CONSOLIDATED SUBSIDIARY
21 253
CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR 68,178 88,124 819,940
CASH AND CASH EQUIVALENTS AT END OF YEAR \ 125,989 \ 68,178 $ 1,515,201
Consolidated Statements of Cash Flows
Kyushu Electric Power Company, Incorporated and Consolidated Subsidiaries
Years Ended March 31, 2011 and 201015Kyushu Electric Power Company, Incorporated (the "Company") has
prepared the accompanying consolidated financial statements in
accordance with the provisions set forth in the Japanese Financial
Instruments and Exchange Act, the Electricity Business Act and their
related accounting regulations and in conformity with accounting
principles generally accepted in Japan ("Japanese GAAP"), which are
different in certain respects as to application and disclosure
requirements of International Financial Reporting Standards. Especially
accounting related to the nuclear power generation is regulated by the
above accounting regulations which are dependent on a governmental
long term nuclear energy policy.
UnderJapaneseGAAP,aconsolidatedstatementofcomprehensive
income is required from the fiscal year ended March 31, 2011 and has
been presented herein. Accordingly, accumulated other comprehensive
income is presented in the consolidated balance sheet and the
consolidated statement of changes in equity. Information with respect
to other comprehensive income for the year ended March 31, 2010 is
disclosed in Note 18.
In preparing these consolidated financial statements, certain
reclassifications and rearrangements have been made to the
consolidated financial statements issued domestically in order to
present them in a form which is more familiar to readers outside Japan.
In addition, certain reclassifications have been made to the consolidated
financial statements for the year ended March 31, 2010 to conform to
the classifications used in the consolidated financial statements for the
year ended March 31, 2011.
The United States dollar amounts included herein are provided
solely for the convenience of readers and are stated at the rate of
83円.15 = U.S. 1,ドル the approximate exchange rate prevailing on March
31, 2011. The translations should not be construed as representations
that the Japanese yen amounts could be converted into United States
dollars at that or any other rate.
1. BaSIS oF PrESEntInG conSolIDatED FInancIal StatEmEntS
a. consolidation and application of the Equity method — The
consolidated financial statements as of March 31, 2011 include the
accounts of the Company and its thirty-six (thirty-four for 2010)
subsidiaries (together, the "Companies"). All significant intercompany
transactions and balances have been eliminated in consolidation.
Investments in sixteen (eighteen for 2010) non-consolidated
subsidiaries and fourteen (thirteen for 2010) affiliated companies are
accounted for by the equity method.
The Company adopts the control or influence concept. Under the
concept, those companies in which the Company, directly or indirectly,
is able to exercise control over operations are treated as subsidiaries
and those companies over which the Companies have the ability to
exercise significant influence are treated as affiliated companies.
The excess of the cost of an acquisition over the fair value of the
net assets of the acquired subsidiary at the date of acquisition is being
amortized over a period of five years.
Consolidation of the remaining subsidiaries and the application of the
equity method to the remaining affiliated companies would not have a
material effect on the accompanying consolidated financial statements.
The fiscal year-end of two consolidated subsidiaries and several
non-consolidated subsidiaries and affiliated companies is December
31. The Company consolidates such consolidated subsidiaries’ financial
statements and accounts for investments in such non-consolidated
subsidiaries and affiliated companies by the equity method using their
financial results for the year ended December 31. The effects of any
significant transactions during the period between the subsidiaries’ and
affiliated companies’ fiscal year-end and the Company’s fiscal year-end
are reflected in the consolidated financial statements.
b. Business combination — In December 2008, the Accounting
Standards Board of Japan (the "ASBJ") issued a revised accounting
standard for business combinations, ASBJ Statement No.21,
"Accounting Standard for Business Combinations." Major accounting
changes under the revised accounting standard are as follows: (1) The
revised standard requires accounting for business combinations only
by the purchase method. As a result, the pooling of interests method
of accounting is no longer allowed. (2) The current accounting standard
accounts for the research and development costs to be charged to
income as incurred. Under the revised standard, in-process research
and development (IPR&D) acquired in the business combination is
capitalized as an intangible asset. (3) The previous accounting standard
provided for a bargain purchase gain (negative goodwill) to be
systematically amortized over a period not exceeding 20 years. Under
the revised standard, the acquirer recognizes the bargain purchase
gain in profit or loss immediately on the acquisition date after
reassessing and confirming that all of the assets acquired and all of the
liabilities assumed have been identified after a review of the procedures
used in the purchase allocation. This standard was applicable to
business combinations undertaken on or after April 1, 2010.
The Companies applied this accounting standard effective
April 1, 2010.
c. Property and Depreciation — Property is stated at cost.
Contributions in aid of construction including those made by customers
are deducted from the cost of the related assets.
Depreciation is principally computed using the declining-balance
method based on the estimated useful lives of the assets. Depreciation
of easements is computed using the straight-line method based on the
estimated useful lives of the transmission lines.
d. Impairment of Fixed assets — The Companies review their
fixed assets for impairment whenever events or changes in
circumstance indicate the carrying amount of an asset or asset group
may not be recoverable. An impairment loss would be recognized if the
2. SUmmarY oF SIGnIFIcant accoUntInG PolIcIES
Notes to Consolidated Financial Statements
Kyushu Electric Power Company, Incorporated and Consolidated Subsidiaries
Years Ended March 31, 2011 and 201016carrying amount of an asset or asset group exceeds the sum of the
undiscounted future cash flows expected to result from the continued
use and eventual disposition of the asset or asset group. The
impairment loss would be measured as the amount by which the
carrying amount of the asset exceeds its recoverable amount, which is
the higher of the discounted cash flows from the continued use and
eventual disposition of the asset or the net selling price at disposition.
e. Amortization of Nuclear Fuel — Amortization of nuclear fuel is
computed based on the proportion of current heat produced to the
estimated total potential heat production over the estimated useful life
of the nuclear fuel.
f. Investment Securities — Investment securities are classified
and accounted for, depending on management’s intent, as follows:
i) held-to-maturity debt securities are stated at cost with discounts or
premiums amortized throughout the holding periods; ii) available-for-
sale securities, which are not classified as the aforementioned
securities and investment securities in non-consolidated subsidiaries
and affiliated companies, are stated at market value; and securities
without market value are stated at cost.
The Companies record unrealized gains or losses on available-for-
sale securities, net of deferred taxes, in equity presented as "Unrealized
gain on available-for-sale securities."
For other than temporary declines in fair value, investment securities
are written down to net realizable value by a charge to income.
g. Cash Equivalents — Cash equivalents are short-term investments
that are readily convertible into cash and that are exposed to
insignificant risk of changes in value. Cash equivalents include time
deposits and mutual funds investing in bonds that represent short-
term investments, all of which mature or become due within three
months of the date of acquisition.
h. Inventories — Inventories are stated at the lower of cost,
principally determined by the average method, or net selling value.
i. Foreign Currency Transactions — Receivables and payables
denominated in foreign currencies are translated into Japanese yen at
the rates in effect as of the each balance sheet date.
j. Foreign Currency Financial Statements — The balance sheet
accounts of the consolidated foreign subsidiary, and non-consolidated
foreign subsidiaries and foreign affiliated companies which are
accounted for by the equity method, are translated into Japanese yen
at the current exchange rate as of the balance sheet date except for
equity, which is translated at the historical rate. Differences arising
from such translation were shown as "Foreign currency translation
adjustments" under accumulated other comprehensive income in a
separate component of equity.
Revenue and expense accounts of consolidated foreign subsidiary
are translated into yen at the average exchange rate.
k. Derivatives and Hedging Activities — Derivative financial
instruments and foreign currency transactions are classified and
accounted for as follows: a) all derivatives are recognized as either
assets or liabilities and measured at fair value, and gains or losses on
derivative transactions are recognized in the income statement and b) for
derivatives used for hedging purposes, if derivatives qualify for hedge
accounting because of high correlation and effectiveness between the
hedging instruments and the hedged items, gains or losses on derivatives
are deferred until maturity of the hedged transactions.
Liabilities denominated in foreign currencies for which foreign
exchange forward contracts and currency swaps are used to hedge
the foreign currency fluctuations are translated at the contracted rate
if the forward contracts and currency swaps qualify for hedge
accounting. Forward contracts and currency swaps applied for
committed transactions are measured at the fair value and the
unrealized gains / losses are deferred until the underlying transactions
are completed.
The interest rate swaps which qualify for hedge accounting and
meet specific matching criteria are not remeasured at market value but
the differential paid or received under the swap agreements are
recognized and included in interest charges.
l. Severance Payments and Pension Plans — The Companies
have unfunded retirement plans for most of their employees and the
Company and most of the consolidated subsidiaries also have
contributory funded defined benefit pension plans covering substantially
all of their employees.
The Companies account for the liability for employees’ retirement
benefits based on the projected benefit obligations and plan assets of
the pension fund at the end of the fiscal year.
m. Reserve for Reprocessing of Irradiated Nuclear Fuel — This
reserve is provided for reprocessing costs of irradiated nuclear fuel.
The annual provision is calculated in accordance with the accounting
regulations set by the Japanese Government applicable to electric
utility providers in Japan.
n. Reserve for Decommissioning of Nuclear Power Units —
Provision is made for future disposition costs of nuclear power units
based on a proportion of the current generation of electric power to the
estimated total life-time generation of electric power of each unit in
accordance with the accounting regulations set by the Japanese
Government applicable to electric utility providers in Japan.
o. Asset Retirement Obligations — In March 2008, the ASBJ
published the accounting standard for asset retirement obligations,
ASBJ Statement No.18 "Accounting Standard for Asset Retirement
Obligations" and ASBJ Guidance No.21 "Guidance on Accounting
Standard for Asset Retirement Obligations". This standard was
effective for fiscal years beginning on or after April 1, 2010. In March
2010, with the standard coming into effect, the Japanese Government,
i.e. the Ministry of Economy, Trade and Industry revised the accounting
regulations applicable to electric utility providers in Japan.
The Companies applied this accounting standard and accounting
regulations effective April 1, 2010.
Under this accounting standard, an asset retirement obligation is
defined as a legal obligation imposed either by law or contract that
results from the acquisition, construction, development and the normal
operation of a tangible fixed asset and is associated with the retirement
of such tangible fixed asset. The asset retirement obligation is
recognized as the sum of the discounted cash flows required for the
future asset retirement.
The Company recognizes the asset retirement obligation as the17sum of the future decommissioning costs imposed by the "Law on the
Regulation of Nuclear Source Material, Nuclear Fuel Material and
Reactors", discounted at 2.3%.
Asset retirement obligations as of April 1, 2010 include the amount
transfered from "Reserve for decommissioning of nuclear power units"
in the consolidated balance sheets as of March 31, 2010.
Upon initial recognition of a liability for an asset retirement
obligation, an asset retirement cost is capitalized by increasing the
carrying amount of the related fixed asset by the amount of the liability.
The asset retirement cost is subsequently allocated to expense based
on a proportion of the current generation of electric power to the
estimated total life-time generation of electric power of each unit.
The effect of this change was to decrease operating income by
769円 million (9,248ドル thousand) and income before income taxes and
minority interests by 19,198円 million (230,884ドル thousand).
p. Income taxes — The provision for income taxes is computed
based on the pretax income included in the consolidated statements of
income. The asset and liability approach is used to recognize deferred
tax assets and liabilities for the expected future tax consequences of
temporary differences between the carrying amounts and the tax
bases of assets and liabilities. Deferred taxes are measured by applying
currently enacted tax laws to the temporary differences.
q. reserve for Fluctuations in Water level — This reserve is
provided to stabilize the Company’s income level based on the
Electricity Business Act and related accounting regulations. This
reserve is recorded when the volume of water for generating
hydroelectric power is abundant and available for future power
generation, and reversed in years when there is an insufficient volume
of water. Also this reserve must be shown as a liability under the act
and regulations. Neither provision nor reversal of the reserve was
made for the years ended March 31, 2011 and 2010.
r. treasury Stock — The accounting standard for treasury stock
requires that where an affiliated company holds a parent company’s
stock, a portion which is equivalent to the parent company’s interest in
such stock should be presented as treasury stock as a separate
component of equity and the carrying value of the investment in the
affiliated company should be reduced by the same amount.
s. net Income and cash Dividends per Share — Basic earnings
per share ("EPS") is computed by dividing net income available to
common shareholders by the weighted-average number of common
shares outstanding during the year and diluted EPS reflects the
potential dilution that could occur if securities were exercised or
converted into common stock.
Diluted EPS is not disclosed for the years ended March 31, 2011
and 2010, because potentially dilutive securities were not outstanding.
Cash dividends per share represent actual amounts applicable to
earnings of the respective years.
t. researchandDevelopmentcosts—Researchanddevelopment
costs are charged to income as incurred.
The breakdown of property as of March 31, 2011 and 2010 was as follows:
3. ProPErtY
Millions of Yen Thousands of U.S. Dollars
2011 2010 2011
Costs:
Electric power production facilities:
Hydroelectric power \ 771,572 \ 734,019 $ 9,279,279
Thermal power 1,461,980 1,459,043 17,582,441
Nuclear power 1,603,145 1,564,071 19,280,156
Internal-combustion engine power 127,026 126,269 1,527,673
Renewable power 104,978 99,217 1,262,514
4,068,701 3,982,619 48,932,063
Transmission facilities 1,648,706 1,628,237 19,828,094
Transformation facilities 964,429 960,966 11,598,665
Distribution facilities 1,345,637 1,329,468 16,183,247
General facilities 391,761 379,864 4,711,497
Other electricity-related facilities 41,460 41,456 498,617
Other plant and equipment 906,449 890,976 10,901,371
Construction in progress 247,837 247,078 2,980,601
Total 9,614,980 9,460,664 115,634,155
Less contributions in aid of construction 157,208 150,818 1,890,655
Less accumulated depreciation 6,424,647 6,272,791 77,265,749
Carrying amount \ 3,033,125 \ 3,037,055 $ 36,477,75118The costs and aggregate fair values of investment securities at March 31, 2011 and 2010 were as follows:
4. InVEStmEnt SEcUrItIES
Millions of Yen
March 31, 2011 Cost Unrealized Gains Unrealized Losses Fair Value
Securities classified as:
Available-for-sale:
Equity securities \ 13,034 \ 19,298 \ 524 \ 31,808
Debt securities 230 29 4 255
Other securities 420 7 28 399
Held-to-maturity 6,370 29 808 5,591
Millions of Yen
March 31, 2010 Cost Unrealized Gains Unrealized Losses Fair Value
Securities classified as:
Available-for-sale:
Equity securities \ 14,530 \ 27,041 \ 801 \ 40,770
Debt securities 2,119 32 829 1,322
Other securities 431 10 27 414
Held-to-maturity 7,074 52 733 6,393
Millions of Yen
March 31, 2011 Proceeds Realized gains Realized loss
Available-for-sale:
Equity securities \ 2,930 \ 2,225
Debt securities 653 \ 61
Other securities 6 4
Total \ 3,589 \ 2,225 \ 65
Thousands of U.S. Dollars
March 31, 2011 Proceeds Realized gains Realized loss
Available-for-sale:
Equity securities $ 35,238 $ 26,759
Debt securities 7,853 $ 734
Other securities 72 48
Total $ 43,163 $ 26,759 $ 782
The information of the available-for-sale securities which were sold during the year ended March 31, 2011 was as follows:
Such information for the year ended March 31, 2010 is not disclosed because that is immaterial.
Thousands of U.S. Dollars
March 31, 2011 Cost Unrealized Gains Unrealized Losses Fair Value
Securities classified as:
Available-for-sale:
Equity securities $ 156,753 $ 232,086 $ 6,302 $ 382,537
Debt securities 2,766 349 48 3,067
Other securities 5,051 84 336 4,799
Held-to-maturity 76,609 349 9,718 67,24019Year ending March 31 Millions of Yen Thousands of U.S. Dollars
2012 \ 232,082 $ 2,791,124
2013 182,563 2,195,586
2014 233,288 2,805,628
2015 170,752 2,053,542
2016 178,049 2,141,299
Thereafter 949,778 11,422,466
Total \ 1,946,512 $ 23,409,645
The annual maturities of long-term debt outstanding at March 31, 2011 were as follows:
Long-term debt consisted of the following at March 31, 2011 and 2010:
6. lonG-tErm DEBt
Millions of Yen Thousands of U.S. Dollars
2011 2010 2011
Yen bonds, 0.35% to 3.65%, due serially to 2031 \ 1,323,342 \ 1,262,514 $ 15,915,117
Swiss franc bonds, 2.625%, due 2014 18,913 18,939 227,456
Loans from The Development Bank of Japan Inc.,
0.70% to 4.85%, due serially to 2028
149,472 175,391 1,797,619
Loans, principally from banks and insurance companies,
0.25% to 2.5%, due serially to 2026
Collateralized 38,541 31,224 463,512
Unsecured 408,332 404,771 4,910,788
Obligations under finance leases 7,912 6,933 95,153
Total 1,946,512 1,899,772 23,409,645
Less current portion 232,082 174,799 2,791,124
Long-term debt, less current portion \ 1,714,430 \ 1,724,973 $ 20,618,521
Employees terminating their employment with the Companies, either
voluntarily or upon reaching mandatory retirement age, are entitled,
under most circumstances, to severance payments based on credits
earned in each year of service, length of service and certain other
factors. As for the Company, if the termination is made voluntarily at
one of a number of specified ages, the employee is entitled to certain
additional payments.
Additionally, the Company and most of the consolidated subsidiaries
have contributory funded defined benefit pension plans covering
substantially all of their employees. In general, eligible employees
retiring at the mandatory retirement age receive pension payments for
the several fixed terms selected by them. As for the Company, eligible
employees retiring after at least 20 years of service but before the
mandatory retirement age, receive a lump-sum payment upon
retirement and annuities.
7. SEVErancE PaYmEntS anD PEnSIon PlanS
All of the Company’s assets amounting to 3,890,891円 million
(46,793,638ドル thousand) are subject to certain statutory preferential
rights established to secure bonds and loans borrowed from The
Development Bank of Japan Inc. and bonds transferred to banks
under debt assumption agreements (see Note 17).
Certain assets of the consolidated subsidiaries, amounting to
79,747円 million (959,074ドル thousand), are pledged as collateral for a
portion of their long-term debt at March 31, 2011.
Investments in affiliated companies held by a consolidated
subsidiary, amounting to 24,417円 million (293,650ドル thousand), are
pledged as collateral for bank loans of the affiliated companies and the
subsidiary of the affiliated company at March 31, 2011.
5. PlEDGED aSSEtS20The liability for employees’ retirement benefits at March 31, 2011 and 2010 consisted of the followings:
Millions of Yen Thousands of U.S. Dollars
2011 2010 2011
Projected benefit obligation \ 493,205 \ 492,766 $ 5,931,509
Fair value of plan assets (330,737) (327,610) (3,977,595)
Unrecognized actuarial loss (17,921) (23,763) (215,526)
Unrecognized prior service cost (deduction of liability) 140 306 1,684
Net liability \ 144,687 \ 141,699 $ 1,740,072
The components of net periodic benefit costs for the years ended March 31, 2011 and 2010 are as follows:
Assumptions for actuarial computations for the years ended March 31, 2011 and 2010 are as follows:
Millions of Yen Thousands of U.S. Dollars
2011 2010 2011
Service Cost \ 15,204 \ 14,689 $ 182,850
Interest Cost 9,678 9,606 116,392
Expected return on plan assets (6,730) (678) (80,938)
Recognized actuarial loss 4,143 10,328 49,826
Amortization of prior service cost (943) (196) (11,341)
Net periodic benefit costs \ 21,352 \ 33,749 $ 256,789
2011 2010
Discount rate 2.0% 2.0%
Expected rate of return on plan assets mainly 2.0% mainly 0.0%
Recognition period of actuarial gain / loss mainly 5 years mainly 5 years
Amortization period of prior service cost mainly 5 years mainly 5 years
The reserve is provided for reprocessing costs of irradiated nuclear
fuel resulting from operation of nuclear power production facilities. The
annual provision is calculated in accordance with the accounting
regulations set by the Japanese Government applicable to electric
utility providers in Japan.
The reserve is consisted of three portions and each of them is
calculated in different ways.
(a) The costs reprocessed in Japan Nuclear Fuel Limited ("JNFL")
are calculated based on the expected future cash flows
discounted at 1.5% and 1.3% at March 31, 2011 and 2010,
respectively,
(b) the costs reprocessed in the other reprocessing companies are
calculated based on the quantities to be reprocessed as of each
balance sheet date and contracted reprocessing rate,
(c) the costs of irradiated nuclear fuels which have no authorized
definite reprocessing plan are calculated based on the expected
future cash flows discounted at 4.0%.
As of April 1, 2005, unrecognized prior costs of 130,495円 million,
which had not been recognized in the past as liability, were incurred
because new accounting regulations to estimate the reprocessing
costs for irradiated nuclear fuel were applicable on or after April 1,
2005. These costs were amortized on a straight-line basis over 15
years. The Company recalculated an estimate in accordance with a
specific law. As a result, the unrecognized prior costs as of April 1,
2008 were changed from 104,397円 million to 90,977円 million, and
these costs are amortized over 12 years, beginning on April 1, 2008.
The balance of unrecognized past costs as of March 31, 2011 was
68,233円 million (820,601ドル thousand). The Company is permitted to
recover these reprocessing costs by including them in the admitted
cost elements for electric rate.
In addition, if any changes are made in the assumptions for the
calculations of the reserve, such as expected future cash flows and the
discount rate, unrecognized difference might be incurred. The balance
of unrecognized difference as of March 31, 2011 is a gain of 9,424円
million (113,337ドル thousand). In accordance with the accounting
regulations, the difference will be amortized on a straight-line basis
beginning the following year the change was made, over the period in
which the irradiated nuclear fuel was produced. The annual amortization
is treated as operating expenses.
An independent fund managing body was set up based on a specific
law and the Company is obliged to contribute the same amounts as the
balance of reserve for reprocessing of irradiated nuclear fuel to reserve
funds in 15 years. The reserve funds is provided to ensure the
appropriate reprocessing of irradiated nuclear fuel and presented as
"Reserve funds for reprocessing of irradiated nuclear fuel."
8. rESErVE For rEProcESSInG oF IrraDIatED nUclEar FUEl21The Companies are subject to national and local income taxes. The aggregate normal statutory tax rates for the Company approximated 36.1% for
the years ended March 31, 2011 and 2010.
The tax effects of significant temporary differences and tax loss carryforwards which resulted in deferred tax assets and liabilities at March 31,
2011 and 2010 are as follows:
Short-term borrowings are generally represented by bank loans, bearing interest at rates ranging from 0.24% to 1.88% and from 0.43% to 1.88%
at March 31, 2011 and 2010, respectively.
11.IncomE taXES
10.SHort-tErm BorroWInGS
Millions of Yen Thousands of U.S. Dollars
2011 2010 2011
Deferred Tax Assets:
Pension and severance costs \ 52,950 \ 51,858 $ 636,801
Depreciation 35,632 33,816 428,527
Asset retirement obligations 28,083 337,739
Reserve for reprocessing of irradiated nuclear fuel 23,443 21,280 281,936
Reserve for decommissioning of nuclear power units 15,025
Unrealized profits arising from the elimination of
intercompany transactions in consolidation
9,774 9,644 117,547
Accrued bonus to employees 7,714 7,645 92,772
Other 39,504 37,277 475,093
Less valuation allowance (28,546) (28,089) (343,307)
Deferred tax assets \ 168,554 \ 148,456 $ 2,027,108
Deferred Tax Liabilities:
Unrealized gain on available-for-sale securities \ 6,551 \ 9,342 78,785ドル
Capitalized asset retirement costs 6,122 73,626
Other 1,875 2,854 22,550
Deferred tax liabilities \ 14,548 \ 12,196 $ 174,961
Net deferred tax assets \ 154,006 \ 136,260 $ 1,852,147
The changes in asset retirement obligations for the year ended March 31, 2011 were as follows:
9. aSSEt rEtIrEmEnt oBlIGatIonS
March 31, 2011 Millions of Yen Thousands of U.S. Dollars
Balance at beginning of year \ 203,325 2,445,279ドル
Net change in the year 4,530 54,480
Balance at end of year \ 207,855 2,499,759ドル22A reconciliation between the normal effective statutory tax rate and the actual effective tax rate reflected in the accompanying consolidated
statements of income for the year ended March 31, 2011 was as follows:
Such reconciliation for the year ended March 31, 2010 is not disclosed because the difference between the normal effective statutory tax rate and
the actual effective tax rate is immaterial.2011Normal effective statutory tax rate 36.1%
Increase in valuation allowance 4.0
Expenses not deductible taxable for income tax purposes 3.0
Tax credit for R&D (1.7)
Other-net (1.6)
Actual effective tax rate 39.8%
Japanese companies are subject to the Companies Act of Japan (the
"Companies Act"). The significant provisions in the Companies Act that
affect financial and accounting matters are summarized below:
(a) Dividends
Under the Companies Act, companies can pay dividends at any time
during the fiscal year in addition to the year-end dividend upon
resolution at the shareholders meeting. For companies that meet
certain criteria, the Board of Directors may declare dividends (except
for dividends in kind) at any time during the fiscal year if the company
has prescribed so in its articles of incorporation. However, the
Company cannot do so because it does not meet all the above
criteria.
The Companies Act permits companies to distribute dividends-in-
kind (non-cash assets) to shareholders subject to a certain limitation
and additional requirements.
Semiannual interim dividends may also be paid once a year upon
resolution by the Board of Directors if the articles of incorporation of
the company so stipulate. The Companies Act provides certain
limitations on the amounts available for dividends or the purchase of
treasury stock. The limitation is defined as the amount available for
distribution to the shareholders, but the amount of net assets after
dividends must be maintained at no less than 3円 million.
(b)Increases / decreases and transfer of common stock,
reserve and surplus
The Companies Act requires that an amount equal to 10% of dividends
must be appropriated as a legal reserve (a component of retained
earnings) or as additional paid-in capital (a component of capital
surplus) depending on the equity account that was charged upon the
payment of such dividends until the total of aggregate amount of legal
reserve and additional paid-in capital equals 25% of the common
stock. Under the Companies Act, the total amount of additional paid-in
capital and legal reserve may be reversed without limitation. The
Companies Act also provides that common stock, legal reserve,
additional paid-in capital, other capital surplus and retained earnings
can be transferred among the accounts under certain conditions upon
resolution of the shareholders.
(c) treasury stock and treasury stock acquisition rights
The Companies Act also provides for companies to purchase treasury
stock and dispose of such treasury stock by resolution of the Board of
Directors. The amount of treasury stock purchased cannot exceed the
amount available for distribution to the shareholders which is
determined by specific formula. Under the Companies Act, stock
acquisition rights are presented as a separate component of equity.
The Companies Act also provides that companies can purchase both
treasury stock acquisition rights and treasury stock. Such treasury
stock acquisition rights are presented as a separate component of
equity or deducted directly from stock acquisition rights.
12.EQUItY
Research and development costs charged to income were 10,692円 million (128,587ドル thousand) and 10,442円 million for the years ended
March 31, 2011 and 2010, respectively.
13.rESEarcH anD DEVEloPmEnt coStS23Items Pertaining to Financial Instruments
(a) the companies’ policy for financial instruments
The Companies use financial instruments, mainly long-term debt
including bonds and loans, to raise funds required for investments
in electric utility plant and equipment, and repayments of bonds
and loans. Cash surpluses, if any, are invested in low risk financial
assets. Derivatives are used, not for speculative purposes, but to
avoid financial risks as described in (b) below.
(b)nature and extent of risks arising from financial instruments,
and risk control system
Investment securities, mainly held-to-maturity debt securities and
equity securities issued by companies related through business,
and investments in and advances to non-consolidated subsidiaries
and affiliated companies which have a quoted market price in an
active market, are exposed to the risk of market price fluctuations.
Such market risk is managed by monitoring market values and
financial position of issuers on a regular basis. Investment securities
and investments in and advances to non-consolidated subsidiaries
and affiliated companies which do not have a quoted market price
in an active market are managed by monitoring financial position of
issuers on a regular basis. In addition, the Company requires its
non-consolidated subsidiaries and affiliated companies to submit
business plans and performance reports, and to consult in advance
on any items that could have a significant impact on the Companies’
business activities.
Reserve funds for reprocessing of irradiated nuclear fuel is
provided in accordance with a specific law to ensure the appropriate
reprocessing of irradiated nuclear fuel resulting from operation of
nuclear power production facilities.
Receivables are exposed to customer credit risk. Payment term
is set forth in electric power supply agreements and so on. The
Companies manage their credit risk from receivables by monitoring
of payment term and balances of each customer and identifying
and reduction of the default risk of customers in early stage.
Bonds and loans are mainly used to raise funds for investments
in electric utility plant and equipment. Bonds in a foreign currency are
exposed to the market risk of fluctuation in foreign currency exchange
rates, which is mitigated by using currency swaps. Although a part of
loans are exposed to market risk from changes in variable interest
rates, a consolidated subsidiary of the Company mitigates such risk
from long-term loans by using interest rate swaps.
Payments terms of notes and accounts payable are less than
one year. Although a part of accounts payable to purchase fuel in
foreign currencies are exposed to the market risk of fluctuations in
foreign exchange and fuel price, such risk is mitigated by using
foreign exchange forward contracts, currency swaps and energy
swap agreements.
The Companies use foreign exchange forward contracts,
currency swaps, interest rate swaps and energy swap agreements
to manage their exposures to fluctuations in foreign exchange,
interest rates and fuel price, respectively.
Please see Note 16 for more detail about derivatives.
Liquidity risk comprises the risk that the Companies cannot
meet their contractual obligations in full on maturity dates. The
Companies manage their liquidity risk by holding adequate volumes
of liquid assets based on monthly financial planning and diversifying
sources of their financing.
15.FInancIal InStrUmEntS anD rElatED DIScloSUrES
Significant transactions of the Company with an affiliated company for the years ended March 31, 2011 and 2010 were as follows:
14.rElatED PartY DIScloSUrES
Millions of Yen Thousands of U.S. Dollars
2011 2010 2011
KYUDENKO CORPORATION
Transactions:
Purchase of construction works on distribution facilities and other
\ 45,362 \ 42,014 $ 545,544
Balances at year end:
Payables for construction works
4,504 5,213 54,16724Millions of Yen
March 31, 2011 Carrying amount Fair value Unrecognized loss
Investment securities:
Held-to-maturity debt securities \ 6,370 \ 5,591 \ 779
Available-for-sale securities 32,462 32,462
Investments in and advances to non-consolidated subsidiaries and
affiliated companies
18,235 11,879 6,356
Reserve funds for reprocessing of irradiated nuclear fuel 197,273 197,273
Cash and cash equivalents 125,989 125,989
Receivables 113,883 113,883
Total \ 494,212 \ 487,077 \ 7,135
Long-term debt:
Bonds \ 1,342,255 \ 1,384,020 \ 41,765
Loans 596,345 615,122 18,777
Short-term borrowings 120,771 120,771
Commercial paper 30,000 30,000
Notes and accounts payable 117,302 117,302
Accrued income taxes 18,737 18,737
Total \ 2,225,410 \ 2,285,952 \ 60,542
Derivatives \ (2,746) \ (2,746)
Millions of Yen
March 31, 2010 Carrying amount Fair value Unrecognized loss
Investment securities:
Held-to-maturity debt securities \ 7,074 \ 6,393 \ 681
Available-for-sale securities 42,506 42,506
Investments in and advances to non-consolidated subsidiaries and
affiliated companies
17,890 12,574 5,316
Reserve funds for reprocessing of irradiated nuclear fuel 167,770 167,770
Cash and cash equivalents 68,178 68,178
Receivables 110,592 110,592
Total \ 414,010 \ 408,013 \ 5,997
Long-term debt:
Bonds \ 1,281,453 \ 1,328,114 \ 46,661
Loans 611,386 634,544 23,158
Short-term borrowings 111,887 111,887
Notes and accounts payable 99,838 9 99,838
Accrued income taxes 21,344 21,344
Total \ 2,125,908 \ 2,195,727 \ 69,819
Derivatives \ 3,126 \ 3,126
Fair values of financial instruments
The carrying amounts and aggregate fair values of financial instruments at March 31, 2011 and 2010 were as follows:25The securities whose fair value cannot be reliably determined are
excluded from investment securities and investments in and advances to
non-consolidated subsidiaries and affiliated companies (see (b) below).
Advances are excluded from investments in and advances to
non-consolidated subsidiaries and affiliated companies because they
are immaterial.
Long-term debt contains current portion of them, and obligations
under finance leases are excluded because they are immaterial.
Derivatives are stated at the net amount.
(a) methods used to calculate fair values of financial instruments
Investment securities, and investments in and advances to
non-consolidated subsidiaries and affiliated companies
The fair values of investment securities and investments in and
advances to non-consolidated subsidiaries and affiliated companies
are measured at the quoted market price of the exchanges for the
equity securities and some of debt securities, and principally at the
quoted price obtained from the financial institution for other debt
securities. The information of the fair values for the investment
securities by classification is included in Note 4.
Reserve funds for reprocessing of irradiated nuclear fuel
Reserve funds for reprocessing of irradiated nuclear fuel is provided
in accordance with a specific law to ensure the appropriate
reprocessing of irradiated nuclear fuel resulting from operation of
nuclear power production facilities.
The funds must be used in accordance with a plan approved by
the Japanese Government. The fair value is based on the carrying
amount determined by discounting the cash flows related to the
using plan.
Cash and cash equivalents, and receivables
The carrying amounts of cash and cash equivalents, and receivables
approximate fair values because of their short maturities.
Bonds
The fair values of bonds are based on market price. Bonds
denominated in a foreign currency for which currency swaps are
used to hedge the foreign currency fluctuations (see Note 16) are
treated as yen-denominated bonds. The fair values are determined
by discounting the cash flows related to the bonds at the Company’s
assumed corporate borrowing rate.
Long-term loans
The fair values of long-term loans at fixed interest rates are
determined by discounting the cash flows related to the loans at
the Company’s assumed corporate borrowing rate. Because loans
at variable interest rates reflect short-term movements in market
interest rates and there has been no substantial change in the
Company’s credit position since the loans were implemented, the
carrying amounts approximate fair values. A part of loans are
subjected to interest rate swaps which qualify for hedge accounting
and meet specific matching criteria (see Note 16), the fair values
are determined by discounting the cash flows related to the loans
with the interest rate swaps at the Company’s assumed corporate
borrowing rate.
Short-term borrowings, commercial paper, notes and
accounts payable, and accrued income taxes
The carrying amounts of short-term borrowings, commercial paper,
notes and accounts payable and accrued income taxes approximate
fair values because of their short maturities.
Derivatives
The information of the fair value for derivatives is included in
Note 16.
Thousands of U.S.Dollars
March 31, 2011 Carrying amount Fair value Unrecognized loss
Investment securities:
Held-to-maturity debt securities $ 76,609 $ 67,240 $ 9,369
Available-for-sale securities 390,403 390,403
Investments in and advances to non-consolidated subsidiaries and
affiliated companies
219,303 142,863 76,440
Reserve funds for reprocessing of irradiated nuclear fuel 2,372,495 2,372,495
Cash and cash equivalents 1,515,201 1,515,201
Receivables 1,369,609 1,369,609
Total $ 5,943,620 $ 5,857,811 $ 85,809
Long-term debt:
Bonds $ 16,142,573 $ 16,644,859 $ 502,286
Loans 7,171,919 7,397,739 225,820
Short-term borrowings 1,452,447 1,452,447
Commercial paper 360,794 360,794
Notes and accounts payable 1,410,728 1,410,728
Accrued income taxes 225,340 225,340
Total $ 26,763,801 $ 27,491,907 $ 728,106
Derivatives $ (33,025) $ (33,025)26The Company enters into foreign exchange forward contracts, currency
swaps, interest rate swaps and energy swap agreements to manage
its exposures to fluctuations in foreign exchanges, interest rates and
fuel price, respectively.
A consolidated subsidiary of the Company enters into interest rate
swaps to manage exposure to fluctuations in interest rates.
The Companies do not enter into derivatives for trading or
speculative purposes.
Foreign exchange forward contracts, currency swaps, interest rate
swaps and energy swap agreements are not subject to any market risk
except for abandoning potential income by market fluctuations in
hedged items.
The Companies do not anticipate any losses arising from credit
risk which is the possibility that a loss may result from counterparties’
failure to perform according to the terms and conditions of the
contract, because the counterparties to those derivatives have high
credit ratings.
The derivative transactions are executed by the specific sections
and administrative section monitors them based on internal policies.
16.DErIVatIVES
Reserve funds for reprocessing of irradiated nuclear fuel is provided for
reprocessing costs of irradiated nuclear fuel charged by JNFL. Using
plan of the reserve funds is disclosed only about due in one year or
less, to comply with agreements with JNFL and to avoid disadvantage,
possibly caused by disclosure, to the interested parties.
Please see Note 6 for annual maturities of long-term debt.
maturity analysis for financial assets and securities with contractual maturities
Millions of Yen
March 31, 2011 Due in one year or less
Due after one year
through five years
Due after five years
through ten years
Due after ten years
Investment securities:
Held-to-maturity debt securities \ 941 \ 1,245 \ 710 \ 3,474
Available-for-sale securities with contractual maturities 7 241 26
Reserve funds for reprocessing of irradiated nuclear fuel 30,898
Cash and cash equivalents 125,989
Receivables 113,883
Total \ 271,718 \ 1,486 \ 736 \ 3,474
Thousands of U.S. Dollars
March 31, 2011 Due in one year or less
Due after one year
through five years
Due after five years
through ten years
Due after ten years
Investment securities:
Held-to-maturity debt securities $ 11,317 $ 14,973 $ 8,539 $ 41,780
Available-for-sale securities with contractual maturities 84 2,898 313
Reserve funds for reprocessing of irradiated nuclear fuel 371,594
Cash and cash equivalents 1,515,201
Receivables 1,369,609
Total $ 3,267,805 $ 17,871 $ 8,852 $ 41,780
(b) Financial instruments whose fair value cannot be reliably determined
Millions of Yen Thousands of U.S. Dollars
2011 2010 2011
Investment securities:
Available-for-sale:
Equity securities \ 72,446 \ 35,696 $ 871,269
Other securities 1,910 1,961 22,970
Investments in and advances to non-consolidated subsidiaries and
affiliated companies:
Equity securities 70,747 48,068 850,836
Other securities 6,986 7,400 84,017
Total \ 152,089 \ 93,125 $ 1,829,09227Derivative transactions to which hedge accounting is applied
Millions of Yen
At March 31, 2011 Hedged item Contract Amount
Contract Amount
due after One Year
Fair Value
Currency swaps:
Buying CHF (Note b) Bonds \ 19,863 \ 19,523
Buying U.S.$ (Note a) Accounts payable \ 52,147 \ 36,819 \ (3,129)
Energy swap agreements:
(fixed price payment, floating price receipt) (Note a)
Accounts payable \ 9,275 \ 6,660 \ 383
Interest rate swaps:
(fixed rate payment, floating rate receipt) (Note b)
Long-term loans \ 3,991 \ 3,299
Total \ (2,746)
Millions of Yen
At March 31, 2010 Hedged item Contract Amount
Contract Amount
due after One Year
Fair Value
Currency swaps:
Buying CHF (Note b) Bonds \ 20,203 \ 19,863
Buying U.S.$ (Note a) Accounts payable \ 40,882 \ 29,550 \ (46)
Energy swap agreements:
(fixed price payment, floating price receipt) (Note a)
Accounts payable \ 4,549 \ 3,599 \ 3,172
Interest rate swaps:
(fixed rate payment, floating rate receipt) (Note b)
Long-term loans \ 4,667 \ 3,991
Total \ 3,126
Thousands of U.S. Dollars
At March 31, 2011 Hedged item Contract Amount
Contract Amount
due after One Year
Fair Value
Currency swaps:
Buying CHF (Note b) Bonds $ 238,882 $ 234,793
Buying U.S.$ (Note a) Accounts payable $ 627,144 $ 442,802 $ (37,631)
Energy swap agreements:
(fixed price payment, floating price receipt) (Note a)
Accounts payable $ 111,545 $ 80,096 $ 4,606
Interest rate swaps:
(fixed rate payment, floating rate receipt) (Note b)
Long-term loans $ 47,998 $ 39,675
Total $ (33,025)
Notes:
a) The fair value of derivative transactions is measured at the quoted price obtained from the financial institution.
b) Bonds denominated in foreign currencies for which currency swaps are used to hedge the foreign currency fluctuations are translated at the contracted rate if the currency swaps
qualify for hedge accounting.
The interest rate swaps which qualify for hedge accounting and meet specific matching criteria are not remeasured at market value but the differential paid or received under
the swap agreements are recognized and included in interest charges.
As a result, the fair values of such currency swaps and interest rate swaps are included in those of hedged items (i.e. bonds and long-term loans, respectively) in Note 15.
c) The contract or notional amounts of derivatives which are shown in the above table do not represent the amounts exchanged by the parties and do not measure the Companies’
exposure to market risk.28Total comprehensive income for the year ended March 31, 2010 was the following:
Other comprehensive income for the year ended March 31, 2010 consisted of the following:
18.comPrEHEnSIVE IncomE
Under the debt assumption agreements, the Company was contingently liable for the redemption of the domestic bonds transferred to banks.
At March 31, 2011, the Companies had a number of fuel purchase commitments, most of which specify quantities and dates for fuel deliveries.
However, most of purchase prices are contingent upon fluctuations in market prices.
Contingent liabilities as of March 31, 2011 were as follows:
17.commItmEntS anD contInGEncIES
Millions of Yen Thousands of U.S. Dollars
Co-guarantees of loans, mainly in connection with procurement of fuel \ 95,410 $ 1,147,444
Guarantees of employees’ loans 82,013 986,326
Guarantees under debt assumption agreements 70,000 841,852
Other 15,203 182,8382010Total comprehensive income attributable to:
Owners of the parent \ 45,636
Minority interests 429
Total comprehensive income \ 46,0652010Other comprehensive income:
Unrealized gain on available-for-sale securities \ 3,048
Deferred gain on derivatives under hedge accounting 478
Share of other comprehensive income in non-consolidated subsidiaries and affiliated companies 334
Total other comprehensive income \ 3,86029Millions of Yen2011Reportable segment
Reconciliations Consolidated
Electric Power
Energy related
Business
IT and
telecommunications
Other Total
Sales:
Sales to external customers \ 1,354,204 \ 59,768 \ 60,913 \ 11,198 \ 1,486,083 \ 1,486,083
Intersegment sales or transfers 2,114 98,247 35,315 14,899 150,575 \ (150,575)
Total 1,356,318 158,015 96,228 26,097 1,636,658 (150,575) 1,486,083
Segment profit 86,599 3,023 6,484 3,381 99,487 (578) 98,909
Segment assets 3,741,007 300,947 147,890 154,974 4,344,818 (159,357) 4,185,461
Other:
Depreciation 222,956 14,130 19,625 5,325 262,036 (2,958) 259,078
Increase in property and
nuclear fuel
228,812 6,465 23,669 7,601 266,547 (4,731) 261,816
(c) Information about sales, profit, assets and other items is as follows.
For the years ended March 31,2011 and 2010
In March 2008, the ASBJ revised ASBJ Statement No.17 "Accounting
Standard for Segment Information Disclosures" and issued ASBJ
Guidance No.20 "Guidance on Accounting Standard for Segment
Information Disclosures". Under the standard and guidance, an entity
is required to report financial and descriptive information about its
reportable segments. Reportable segments are operating segments or
aggregations of operating segments that meet specified criteria.
Operating segments are components of an entity about which separate
financial information is available and such information is evaluated
regularly by the chief operating decision maker in deciding how to
allocate resources and in assessing performance. Generally, segment
information is required to be reported on the same basis as is used
internally for evaluating operating segment performance and deciding
how to allocate resources to operating segments. This accounting
standard and the guidance are applicable to segment information
disclosures for the fiscal years beginning on or after April 1, 2010.
The segment information for the year ended March 31, 2010
under the revised accounting standard is also disclosed hereunder as
required. However, with regard to segment information for the previous
fiscal year, disclosure of segment information for the previous fiscal
year prepared on the basis of the revised accounting standard has
been omitted since information similar to that was disclosed.
19.SEGmEnt InFormatIon
(a) Description of reportable segments
The Companies’ reportable segments are those for which separately
financial information is available and regular evaluation by the
Company’s management is being performed in order to decide how
resources are allocated among the Companies. Therefore, the
Companies consist of the industry Electric power, Energy related
Business, IT and telecommunications and Other.
Energy related business consists of obtaining, storing, gasifying,
supplying and selling LNG and other businesses related to energy.
IT and telecommunications consists of provision of
telecommunications.
Other consists of environment and recycling, lifestyle-oriented
services and others.
(b)methods of measurement for the amounts of sales, profit,
assets and other items for each reportable segment
The accounting policies of each reportable segment are
consistent to those disclosed in Note 2, "Summary of Significant
Accounting Policies".30Millions of Yen2010Electric Power
Energy-related
Business
IT and
telecommunications
Other
Eliminations/
Corporate
Consolidated
Sales to customers \ 1,310,085 \ 65,503 \ 58,143 \ 11,210 \ 1,444,941
Intersegment sales 2,019 98,297 41,042 15,350 \ (156,708)
Total sales 1,312,104 163,800 99,185 26,560 (156,708) 1,444,941
Operating expenses 1,229,155 156,398 92,824 23,344 (156,507) 1,345,214
Operating income \ 82,949 \ 7,402 \ 6,361 \ 3,216 \ (201) \ 99,727
Total assets \ 3,645,116 \ 281,893 \ 142,979 \ 146,973 \ (162,769) \ 4,054,192
Depreciation 219,834 14,628 19,903 5,229 (2,894) 256,700
Impairment loss 1,786 200 1,986
Capital expenditures 215,507 4,901 18,994 9,372 (4,593) 244,181
At the general shareholders meeting held on June 28, 2011, the Company’s shareholders approved the following appropriation of retained
earnings as of March 31, 2011:
20.SUBSEQUEnt EVEnt
Millions of Yen Thousands of U.S. Dollars
Year-end cash dividends, 30円.00 (0ドル.36) per share \ 14,198 $ 170,752
Thousands of U.S. Dollars2011Reportable segment
Reconciliations Consolidated
Electric Power
Energy related
Business
IT and
telecommunications
Other Total
Sales:
Sales to external customers $ 16,286,278 $ 718,797 $ 732,568 $ 134,672 $ 17,872,315 $ 17,872,315
Intersegment sales or transfers 25,424 1,181,564 424,714 179,182 1,810,884 $ (1,810,884)
Total 16,311,702 1,900,361 1,157,282 313,854 19,683,199 (1,810,884) 17,872,315
Segment profit 1,041,479 36,356 77,980 40,661 1,196,476 (6,951) 1,189,525
Segment assets 44,991,064 3,619,327 1,778,593 1,863,788 52,252,772 (1,916,500) 50,336,272
Other:
Depreciation 2,681,371 169,934 236,019 64,041 3,151,365 (35,574) 3,115,791
Increase in property and
nuclear fuel
2,751,798 77,751 284,654 91,413 3,205,616 (56,897) 3,148,719
Notes:
(a) Reconciliations of the segment profit and the segment assets are intersegment transaction eliminations.
(b) Segment profit is adjusted to reflect operating income on the consolidated statements of income.
For the year ended March 31, 2010
Information by business segments for the years ended Marth 31, 2010 is as follows:
Business Segments
Geographic segment information is not disclosed because the Companies’ overseas operations are immaterial.
Information for overseas sales is not disclosed due to overseas sales being immaterial compared with consolidated net sales.3132
Millions of Yen
(except for per share data)
Thousands of
U.S. Dollars
(except for per share data)
For the Year: 2011 2010 2009 2008 2007 2011
Operating revenues \ 1,387,518 \ 1,339,808 \ 1,430,162 \ 1,392,060 \ 1,333,038 $ 16,686,927
Electric 1,356,318 1,312,104 1,400,792 1,365,701 1,310,170 16,311,702
Other 31,200 27,704 29,370 26,359 22,868 375,225
Operating expenses 1,269,719 1,229,155 1,326,654 1,271,380 1,165,874 15,270,222
Personnel 162,651 172,720 136,794 138,313 144,806 1,956,115
Fuel 284,858 213,008 305,600 279,930 211,318 3,425,833
Purchased power 137,063 113,668 149,940 123,276 112,603 1,648,382
Depreciation 197,978 196,742 195,232 197,343 189,004 2,380,974
Maintenance 175,986 195,118 197,807 184,938 170,789 2,116,488
Reprocessing costs of
irradiated nuclear fuel 30,796 33,787 34,167 41,579 49,859 370,367
Decommissioning costs of
nuclear power units 7,524 9,093 8,309 21,357 6,546 90,487
Disposal cost of high-level
radioactive waste 8,885 10,373 8,669 9,125 8,822 106,855
Disposition of property 15,181 16,478 22,877 16,329 17,866 182,574
Taxes other than
income taxes 87,680 87,474 88,453 87,107 87,216 1,054,480
Subcontract fee 67,729 79,226 74,835 70,721 65,657 814,540
Rent 32,789 34,334 35,760 36,547 36,515 394,336
Other 60,599 67,134 68,211 64,815 64,873 728,791
Interest charges 32,151 33,145 33,444 34,426 35,800 386,663
Income before income taxes 35,778 50,356 44,165 60,162 100,085 430,283
Net income 20,444 28,308 26,917 35,683 59,237 245,869
Per share of common stock
(yen and U.S. dollars):
Basic net income \ 43.19 \ 59.80 \ 56.85 \ 75.37 \ 125.07 $ 0.52
Cash dividends
applicable to the year 60.00 60.00 60.00 60.00 60.00 0.72
At year-end:
Total assets \ 3,890,891 \ 3,776,569 \ 3,834,125 \ 3,784,701 \ 3,790,112 $ 46,793,638
Net property 2,811,194 2,811,064 2,847,639 2,878,537 2,926,322 33,808,707
Long-term debt,
less current portion
1,627,260 1,641,073 1,715,780 1,620,563 1,595,429 19,570,174
Total equity 967,516 984,109 981,540 999,679 1,018,804 11,635,791
(U.S. dollar amounts have been translated from yen, for convenience, at the rate of 83円.15 = U.S. 1,ドル the approximate rate of exchange at March 31, 2011.)
Non-consolidated Five-Year Financial Summary
Kyushu Electric Power Company, Incorporated
Years Ended March 31, 2011 and 2010 (Unaudited)33Millions of Yen
Thousands of
U.S. Dollars
2011 2010 2011
ASSETS
PROPERTY:
Plant and equipment \ 8,732,411 \ 8,592,420 $ 105,019,976
Construction in progress 245,260 246,824 2,949,609
Total 8,977,671 8,839,244 107,969,585
Less-
Contributions in aid of construction 149,323 143,024 1,795,827
Accumulated depreciation 6,017,154 5,885,156 72,365,051
Total 6,166,477 6,028,180 74,160,878
Net property 2,811,194 2,811,064 33,808,707
NUCLEAR FUEL 263,381 269,663 3,167,541
INVESTMENTS AND OTHER ASSETS:
Investment securities 104,139 76,414 1,252,423
Investments in and advances to subsidiaries and affiliated companies 150,753 134,056 1,813,025
Reserve funds for reprocessing of irradiated nuclear fuel 197,273 167,770 2,372,495
Deferred tax assets 117,874 101,793 1,417,607
Other assets 11,145 15,771 134,035
Total investments and other assets 581,184 495,804 6,989,585
CURRENT ASSETS:
Cash and cash equivalents 85,105 41,681 1,023,512
Receivables 90,882 87,637 1,092,989
Allowance for doubtful accounts (596) (711) (7,168)
Fuel and supplies 39,232 47,135 471,822
Deferred tax assets 13,164 11,440 158,316
Prepaid expenses and other 7,345 12,856 88,334
Total current assets 235,132 200,038 2,827,805
TOTAL \ 3,890,891 \ 3,776,569 $ 46,793,638
(U.S. dollar amounts have been translated from yen, for convenience, at the rate of 83円.15 = U.S. 1,ドル the approximate rate of exchange at March 31, 2011.)
Non-consolidated Balance Sheets
Kyushu Electric Power Company, Incorporated
March 31, 2011 and 2010 (Unaudited)34Millions of Yen
Thousands of
U.S. Dollars
2011 2010 2011
LIABILITIES AND EQUITY
LONG-TERM LIABILITIES:
Long-term debt, less current portion \ 1,627,260 \ 1,641,073 $ 19,570,174
Liability for employees’ retirement benefits 127,722 124,225 1,536,043
Reserve for reprocessing of irradiated nuclear fuel 368,931 369,220 4,436,934
Reserve for decommissioning of nuclear power units 164,931
Asset retirement obligations 207,690 2,497,775
Other 23,742 15,758 285,532
Total long-term liabilities 2,355,345 2,315,207 28,326,458
CURRENT LIABILITIES:
Current portion of long-term debt 200,512 153,929 2,411,449
Short-term borrowings 116,000 104,600 1,395,069
Commercial paper 30,000 360,794
Accounts payable 95,707 77,447 1,151,016
Accrued income taxes 16,856 17,908 202,718
Accrued expenses 80,756 91,520 971,209
Other 28,199 31,849 339,134
Total current liabilities 568,030 477,253 6,831,389
EQUITY :
Common stock, authorized, 1,000,000,000 shares; issued,
474,183,951 shares in 2011 and 2010
237,305 237,305 2,853,939
Capital surplus:
Additional paid-in capital 31,087 31,087 373,867
Other capital surplus 28 30 337
Retained earnings:
Legal reserve 59,326 59,326 713,482
Retained earnings - carryforward 632,893 640,850 7,611,461
Unrealized gain on available-for-sale securities 10,728 15,481 129,020
Deferred gain (loss) on derivatives under hedge accounting (1,755) 1,998 (21,107)
Treasury stock-at cost 905,742 shares in 2011 and 835,566 shares in 2010 (2,096) (1,968) (25,208)
Total equity 967,516 984,109 11,635,791
TOTAL \ 3,890,891 \ 3,776,569 $ 46,793,63835Millions of Yen
Thousands of
U.S. Dollars
2011 2010 2011
OPERATING REVENUES:
Electric \ 1,356,318 \ 1,312,104 $ 16,311,702
Other 31,200 27,704 375,225
Total operating revenues 1,387,518 1,339,808 16,686,927
OPERATING EXPENSES:
Electric:
Personnel 162,651 172,720 1,956,115
Fuel 284,858 213,008 3,425,833
Purchased power 137,063 113,668 1,648,382
Depreciation 197,978 196,742 2,380,974
Maintenance 175,986 195,118 2,116,488
Reprocessing costs of irradiated nuclear fuel 30,796 33,787 370,367
Decommissioning costs of nuclear power units 7,524 9,093 90,487
Disposal cost of high-level radioactive waste 8,885 10,373 106,855
Disposition of property 15,181 16,478 182,574
Taxes other than income taxes 87,680 87,474 1,054,480
Subcontract fee 67,729 79,226 814,540
Rent 32,789 34,334 394,336
Other 60,599 67,134 728,791
Total 1,269,719 1,229,155 15,270,222
Other 32,726 25,743 393,578
Total operating expenses 1,302,445 1,254,898 15,663,800
OPERATING INCOME 85,073 84,910 1,023,127
OTHER EXPENSES (INCOME):
Interest charges 32,151 33,145 386,663
Gain on sales of investment securities (2,225) (30) (26,759)
Loss on adjustment for changes of
accounting standard for asset retirement obligations
18,326 220,397
Other-net 1,043 1,439 12,543
Total other expenses-net 49,295 34,554 592,844
INCOME BEFORE INCOME TAXES 35,778 50,356 430,283
INCOME TAXES:
Current 28,334 24,619 340,758
Deferred (13,000) (2,571) (156,344)
Total income taxes 15,334 22,048 184,414
NET INCOME \ 20,444 \ 28,308 $ 245,869
Yen U.S. Dollars
PER SHARE OF COMMON STOCK:
Basic net income \ 43.19 \ 59.80 $ 0.52
Cash dividends applicable to the year 60.00 60.00 0.72
(U.S. dollar amounts have been translated from yen, for convenience, at the rate of 83円.15 = U.S. 1,ドル the approximate rate of exchange at March 31, 2011.)
Non-consolidated Statements of Income
Kyushu Electric Power Company, Incorporated
Years Ended March 31, 2011 and 2010 (Unaudited)36Nuclear Power Stations (two facilities/maximum output 5,258,000 kW)
Station name Maximum output (kW)
Operation
commencement date
System Location
Genkai 3,478,000 (×ばつ2 ×ばつ2) Oct. 1975 Pressurized water reactor Genkai-cho, Higashi Matsuura-gun, Saga Prefecture
Sendai 1,780,000 (×ばつ2) Jul. 1984 Pressurized water reactor Satsumasendai-shi, Kagoshima Prefecture
Thermal Power Stations (10 facilities/maximum output 11,180,000 kW)
Station name Maximum output (kW)
Operation
commencement date
Main fuel Location
Shin Kokura 1,800,000 (×ばつ3) Sep. 1978 LNG Kokura Kita-ku, Kitakyushu-shi, Fukuoka Prefecture
Karita 735,000 (×ばつ1 ×ばつ1) Apr. 1972 Coal/heavy oil/crude oil Kanda-machi, Miyako-gun, Fukuoka Prefecture
Buzen 1,000,000 (×ばつ2) Dec. 1977 Heavy oil/crude oil Buzen-shi, Fukuoka Prefecture
Karatsu 875,000 (×ばつ1 ×ばつ1) Jul. 1971 Heavy oil/crude oil Karatsu-shi, Saga Prefecture
Matsuura 700,000 Jun. 1989 Coal Matsuura-shi, Nagasaki Prefecture
Ainoura 875,000 (×ばつ1 ×ばつ1) Apr. 1973 Heavy oil/crude oil Sasebo-shi, Nagasaki Prefecture
Oita 500,000 (×ばつ2) Jul. 1969 Heavy oil Oita-shi, Oita Prefecture
Shin Oita 2,295,000 (×ばつ6 ×ばつ4 ×ばつ3) Jun. 1991 LNG Oita-shi, Oita Prefecture
Reihoku 1,400,000 (×ばつ2) Dec. 1995 Coal Reihoku-machi, Amakusa-gun, Kumamoto Prefecture
Sendai 1,000,000 (×ばつ2) Jul. 1974 Heavy oil/crude oil Satsumasendai-shi, Kagoshima Prefecture
Hydroelectric Power Stations (139 facilities/maximum output 3,278,696 kW)
Station name Maximum output (kW)
Operation
commencement date
System Location
Tenzan 600,000 Dec. 1986
Dam and conduit system
(pure pumped-storage)
Karatsu-shi, Saga Prefecture
Yanagimata 63,800 Jun. 1973 Dam and conduit system Hita-shi, Oita Prefecture
Matsubara 50,600 Aug. 1971 Dam system Hita-shi, Oita Prefecture
Ohira 500,000 Dec. 1975
Dam and conduit system
(pure pumped-storage)
Yatsushiro-shi, Kumamoto Prefecture
Iwayado 51,100 Jan. 1942 Dam and conduit system Shiiba-son, Higashi Usuki-gun, Miyazaki Prefecture
Kamishiiba 93,200 May 1955 Dam and conduit system Shiiba-son, Higashi Usuki-gun, Miyazaki Prefecture
Tsukabaru 63,090 Oct. 1938 Dam and conduit system Morotsuka-son, Higashi Usuki-gun, Miyazaki Prefecture
Morotsuka 50,000 Feb. 1961 Dam and conduit system Morotsuka-son, Higashi Usuki-gun, Miyazaki Prefecture
Omarugawa 900,000 Jul. 2007
Dam and conduit system
(pure pumped-storage)
Kijo-cho, Koyu-gun, Miyazaki Prefecture
Hitotsuse 180,000 Jun. 1963 Dam and conduit system Saito-shi, Miyazaki Prefecture
Oyodogawa Daiichi 55,500 Jan. 1926 Dam system Miyakonojo-shi, Miyazaki Prefecture
Oyodogawa Daini 71,300 Mar. 1932 Dam and conduit system Miyazaki-shi, Miyazaki Prefecture
*with outputs of 50,000 kW or higher
Geothermal Power Stations (6 facilities/maximum output 212,000 kW)
Station name Maximum output (kW)
Operation
commencement date
Location
Takigami 27,500 Nov. 1996 Kokonoe-machi, Kusu-gun, Oita Prefecture
Otake 12,500 Aug. 1967 Kokonoe-machi, Kusu-gun, Oita Prefecture
Hatchoubaru 110,000 (×ばつ2) Jun. 1977 Kokonoe-machi, Kusu-gun, Oita Prefecture
Hatchoubaru Binary 2,000 Apr. 2006 Kokonoe-machi, Kusu-gun, Oita Prefecture
Ogiri 30,000 Mar. 1996 Kirishima-shi, Kagoshima Prefecture
Yamagawa 30,000 Mar. 1995 Ibusuki-shi, Kagoshima Prefecture
Wind Power Stations (two facilities/maximum output total 3,250 kW)
Station name Maximum output (kW)
Operation
commencement date
Location
Koshikijima wind power 250 Mar. 2003 Satomura, Satsuma-gun, Kagoshima Prefecture
Noma-misaki wind park 3,000 Mar. 2003 Minami satsuma-shi, Kagoshima Prefecture
Internal Combustion Power Stations (34 facilities/maximum output 395,270 kW) *including gas turbines
Station name Maximum output (kW)
Operation
commencement date
Location
Shinarikawa 60,000 (×ばつ6) Jun. 1982 Shinkamigotou-chou, Minami matsuura-gun, Nagasaki Prefecture
Tatsugo 60,000 (×ばつ6) Jun. 1980 Tatsugo-chou, Ooshima-gun, Kagoshima Prefecture
*with outputs of 50,000 kW or higher
Overview of Power Generation Facilities
(As of March 31, 2011)37Consolidated Subsidiaries
Company Name
Capital
(Millions of yen)
Equity
Ownership(%)Business
Energy Business in Kyushu
Oita Liquefied Natural Gas Co., Inc. 7,500 98.0 Receipt, storage, vaporization and delivery and sales of LNG
Kitakyushu Liquefied Natural Gas Co., Inc. 4,000 75.0 Receipt, storage, vaporization and delivery and sales of LNG
Pacific Hope Shipping Limited 4,071 60.0 Purchasing, operating, chartering and renting of LNG carriers
Nishinippon Environmental Energy Co., Inc. 1,010 100.0 Distributed power system business and consultation about energy efficiency
Kyuden Ecosol Co., Ltd. 495 100.0 On-site solar power generation business
Kyushu Rinsan Co. 490 100.0 Greening construction at power stations and other facilities
Nagashima Windhill Co., Ltd. 490 86.0 Sales of electricity generated by wind power
Fukuoka Energy Service Co., Inc. 490 80.0 Heat supply business
KYUKI CORPORATION 305 67.0 Manufacture and sales of electric machinery
NISHI NIPPON AIRLINES CO., LTD. 360 54.7 Air cargo transportation
Nishinippon Plant Engineering and Construction Co., Ltd. 150 85.0 Construction, maintenance and repair of power generation facilities
Kyushu Kouatsu Concrete Industries Co., Ltd. 240 51.3 Manufacture and sales of concrete poles
Kyuden Sangyo Co., Inc. 117 100.0 Environmental preservation work at power stations
Miyazaki Biomass Recycle Co., Inc. 100 42.0 Power-generation activities using poultry dung fuel
West Japan Engineering Consultants, Inc. 40 100.0 Consultation and planning of civil engineering and construction
Kyushu Meter & Relay Engineering Corporation 22 98.6 Repair and maintenance of electronic instruments
Koyo Denki Kogyo Co., Ltd. 20 95.9 Manufacture and sales of HV and LV insulators and other items
Nishigi Kogyo, Co., Inc. 20 74.0 Conduit maintenance for hydroelectric power stations
Energy Business overseas
Kyuden International Corporation 23,150 100.0 Acquisition and holding of securities of overseas electric companies
Kyuden International Netherlands B.V. 6,497 100.0 Acquisition and holding of securities of overseas electric companies
kyuden Hsin Tao Power Holdings 6,476 100.0 Investment in Hsin Tao IPP business company
It and telecommunications
Kyushu Telecommunication Network Co., Inc. 22,020 97.5 Fiber-optic cable and broadband services
Kyuden Infocom Company, Inc. 480 100.0 IT-related planning and consultation, and data center business
Nishimu Electronics Industries, Co., Ltd. 300 100.0 Manufacture, sales, installation and maintenance of telecomunication devices
Kyuden Business Solutions Co., Inc. 100 100.0 Development, operation and maintenance of information systems
RKK Computer Service Co., Inc. 100 61.3 Development and sales of computer softwares
lifestyle-oriented Services
DENKI BLDG. CO., Ltd. 3,395 91.9 Leasing and management of real estate
Capital Kyuden Corporation 600 100.0 Acquiring and owning of securities, loans to group companies
Kyuden Good Life Company, Inc. 300 100.0 Paid elderly nursing home management and nursing services
Kyuden Good Life Kumamoto Company, Inc. 200 100.0 Paid elderly nursing home management and nursing services
Kyuden Business Front Inc. 100 100.0 Temporary staffing and job-placement services
Kyuden Good Life Fukuoka Josui Company, Inc. 100 100.0 Paid elderly nursing home management and nursing services
Kyuden Good Life Kagoshima Company, Inc. 100 90.0 Paid elderly nursing home management and nursing services
Kyuden Good Life Higashifukuoka Company, Inc. 100 70.0 Paid elderly nursing home management and nursing services
Kyuden Fudousan Co., Ltd. 32 98.1 Leasing of real estate and site management
Kyuden Office Partner Co., Inc. 30 100.0 Clerical work acceptance on trust and consulting business
Subsidiaries and Affiliated Companies
(As of March 31, 2011)38Company Name
Capital
(Millions of yen)
Equity
Ownership(%)Business
Energy Business in Kyushu
Tobata Co-operative Thermal Power Co., Inc. 9,000 50.0 Wholesale electricity supply
Fukuoka Clean Energy Co., Ltd. 5,000 49.0 Waste incineration and power generation business
Kyudenko Corporation 7,901 30.9 Electric work
Oita Co-operative Thermal Power Co., Inc. 4,000 50.0 Wholesale electricity supply
KYUSYU CRYOGENICS CO., LTD. 450 50.0 Manufacture and sales of liquid oxygen, liquid nitrogen and liquid argon
Kyuhen Co., Ltd. 225 35.9 Manufacture and sales of electrical equipment
Seishin Corporation 200 26.5 Sale of electrical equipment
Kyuken Corporation 100 15.2 Construction and repair of transmission lines
Plazwire Co., Ltd. 50 100.0 Flame spray coating (painting) business
Nishikyushu Kyodo Kowan Co., Ltd. 50 50.0 Operation and maintenance of coal handling equipment
Nihon FRP Co., Inc. 30 65.0 Design fabrication, repair and installation of reinforced plastic
Nishi Nihon Denki Tekkou Co., Ltd. 30 33.5 Design, production and sales of steel towers and steel conduits
NISHIDA TECHNO SERVICE Co., Inc. 20 65.0 Inspection, maintenance, design, production and construction of sluice and weir equipment
Washiodake Wind Power Co., Ltd. 10 100.0 Development of wind power generation facilities and sales of generated electric power
NISHIGI SURVEYING AND DESIGN CO., LTD. 10 100.0 Investigation, measurement, design, drafting and care of civil engineering/construction projects
Amami Oshima Wind Power Co., Ltd. 10 75.0 Sales of electric power from wind generation
Energy Business overseas
KYUDEN ILIJAN HOLDING CORPORATION
3,050
(Thousands of U.S. dollars)
100.0 Investment in Ilijan IPP business company
Kyushu Tohoku Enrichment Investing S.A.S
103,960
(Thousands of Euro)
50.0 Investment in uranium enrichment business
KYUDEN SARULLA PTE. LTD.
6,824
(Thousands of Singapore dollars)
100.0 Geothermal power generation
Electricidad Aguila de Tuxpan, S.deR.L.deC.V.
641,743
(Thousands of Mexico Pesos)
50.0 Power-generation activities using natural gas fuel
Electricidad Sol de Tuxpan, S.deR.L.deC.V.
493,407
(Thousands of Mexico Pesos)
50.0 Power-generation activities using natural gas fuel
It and telecommunications
RKKCS Software 10 100.0 Developments and sales of computer software
Environment and recycling Business
J-Re-Lights Co., Ltd. 275 100.0 Recycling of used fluorescent bulbs
Kyushu Environmental Management Corporation 80 98.1 Recycling of confidential documents
lifestyle-oriented Services
Kyushu Housing Guarantee Corporation 272 33.3 Housing and building assessments, security services affairs
Kyushu Highlands Development Co., Ltd. 300 100.0 Management of golf courses
Kyuden Home Security Co., Inc. 250 97.5 Home security and monitoring business
Kyuden Shared Business Co., Ltd. 80 100.0 Accounting and personnel services
Kyushu Captioning Co-Production Center Inc. 60 76.7 Subtitle production for broadcasting
Oak Co., Ltd. 3 100.0 Real estate management
Non-consolidated Subsidiaries and Affiliated Companies Accounted for under Equity Method39(Fiscal Year) Noteworthy Events
1951 Kyushu Electric Power is established.1953Kyushu Electric Power receives its first postwar loan (approximately 3円.8 billion) in Japan from the International Bank for
Reconstruction and Development (the World Bank).1955The Kamishiiba Power Station, the first in Japan with an arch dam, becomes operational.
Unit 1 at the Karita Thermal Power Station, an advanced, high-capacity system (75,000 kW) becomes operational.1957Kyushu Electric Power completes its Central Line (220,000 V), its first super-high-voltage transmission line.
Thermal generation capacity exceeds hydroelectric capacity.
1960 Frequency unification is completed.1967The Otake Power Station, Japan’s first commercial geothermal generation facility, becomes operational with a capacity of 11,000 kW.
Unit 1 at the Karatsu Power Station (156,000 kW) becomes operational as Kyushu Electric Power’s first generation facility with a control computer.1969Unit 1 at the Oita Power Station (250,000 kW), Kyushu Electric Power’s first facility designed to run exclusively on heavy fuel oil,
becomes operational.
1970 The provision of electric lighting to all homes is completed.1975Unit 1 at the Genkai Power Station (559,000 kW), Kyushu Electric Power’s first nuclear facility, becomes operational.
The Ohira Power Station, then Japan’s biggest pumped-storage facility (500,000 kW) becomes operational.1977Unit 1 at the Hatchoubaru Geothermal Power Station, one of the biggest in Japan, becomes operational,
initially with a capacity of 23,000 kW.1980Kyushu Electric Power builds the Central and West Kyushu Substations (500,000 V) and raises the voltage on its Saga Line to 500,000 V.
The 500,000 V Trans-Kanmon Line becomes operational.
1982 The Kyushu Energy Center is opened.
1984 Unit 1 at the Sendai Nuclear Power Station (890,000 kW) becomes operational.1986Unit 1 at the Tenzan Power Station (300,000 kW), a large-capacity pumped-storage facility, becomes operational.
Kyushu Electric Power begins to use automatic control systems on its distribution lines.
1989 Kyushu Electric Power achieves a zero outage record for work on high-and low-voltage facilities for the first time in Japan.1990The No. 1 System at the Shin Oita Power Station (690,000 kW) becomes operational. Designed to use LNG,
this combined-cycle unit provides excellent thermal efficiency.
1992 Kyushu Electric Power begins to purchase surplus electric power from distributed generation facilities, including solar and wind power systems.1998Kyushu Electric Power begins to operate a superconducting storage system as an electric power facility.
It is the first of its type in Japan and one of the largest in the world.
2000 The Genkai Energy Park is opened.2001A loan agreement is signed for the Tuxpan II IPP project in Mexico.
The Kyushu Homeland Forestation Program is launched.
2002 Dedicated sales representatives are assigned to corporate customers.
2004 The Call Center is extended to the entire corporate organization.
2005 The Goto Archipelago Link, Japan’s longest sea-bed cable, becomes operational.
2007 "Kyushu Electric Power’s Mission" and brand message "Enlighten Our Future" are adopted.
2009 Implementation of Japan’s first pluthermal operation.
2010 The Omuta mega solar power plant, our first largescale solar power generation station, becomes operational.
Outline of Kyushu Electric Power’s History
(As of March 31, 2011)40Corporate Data
Company Overview
Stock Information
Stock Price Movement
Major ShareholdersNameNumber of Shares Held
(Thousands of Shares)
Shareholding Ratio(%)Meiji Yasuda Life Insurance 22,882 4.83
The Master Trust Bank of Japan, Ltd.(trust unit) 22,081 4.66
Japan Trustee Services Bank, Ltd. (trust unit) 18,845 3.97
Nippon Life Insurance Company 18,454 3.89
Mizuho Corporate Bank, Ltd. 9,669 2.04
Mizuho Trust and Banking, Retirement Benefit Trust Fukuoka Bank unit 8,637 1.82
Sumitomo Mitsui Banking Corporation 8,474 1.79
Kyushu Electric Power Co., Inc. Employees' Shareholding Association 7,640 1.61
SSBT OD05 OMNIBUS ACCOUNT-TREATY CLIENTS 7,427 1.57
Kochi Sinkin Bank 6,989 1.47
Trade Name Kyushu Electric Power Company, Incorporated
Head Office 1-82, Watanabe-dori 2-chome, Chuo-ku, Fukuoka 810-8720, Japan
Phone +81-92-761-3031
Tokyo Branch Office 7-1, Yurakucho 1-chome, Chiyoda-ku, Tokyo 100-0006, Japan
Phone +81-3-3281-4931
Date of Establishment May 1, 1951
Paid-in Capital 237,304,863,699円
Number of Employees 12,689
Total Number of Shares Authorized 1,000,000,000
Number of Shares Issued and Outstanding 474,183,951
Number of Shareholders 185,010
Shareholders’ Meeting June
Fiscal Year-end March 31
Stock Listings Tokyo Stock Exchange, Osaka Securities Exchange,
Fukuoka Stock Exchange
(Code: 9508)
Transfer Agent and Registrar The Chuo Mitsui Trust and Banking Co., Ltd.
33-1, Shiba 3-chome, Minato-ku, Tokyo, Japan
Accounting Auditor Deloitte Touche TohmatsuLessthan 100
20.5%
100 to 499
34.9%
500 to 999
13.8%
1,000 to 4,999
27.5%
5,000 or more3.3%By Number of Shares Held
Financial
Institutions
44.1%
Foreign Investors
10.7%
Other Domestic
Companies 6.2%
Securities Firms1.3%Governmental
Organization0.9%Individuals
and Other
36.8%
By Type of Shareholder
Composition of Shareholders010,000
20,000
30,000
40,000
50,000
60,000
70,000
80,0000500
1,000
1,500
2,000
2,500
3,000
3,500
4,000200642007420084200942010420113
(Thousands of Shares)
(Yen)41(As of March 31, 2011)
古紙パルプ配合率100%再生紙を使用
Printed in Japan