Contents

45 Consolidated Eleven-year Financial Summary, and Summary of the
Year Ended March 31, 2015
47 Management Discussion and Analysis
49 Business Risk Factors
51 Consolidated Balance Sheet
53 Consolidated Statement of Operations
54 Consolidated Statement of Comprehensive Income
55 Consolidated Statement of Changes in Equity
56 Consolidated Statement of Cash Flows
57 Notes to Consolidated Financial Statements
57 1. Basis of Presenting Consolidated Financial Statements
2. Summary of Significant Accounting Policies
62 3. Property
4. Investment Securities
63 5. Pledged Assets
6. Long-Term Debt
64 7. Severance Payments and Pension Plans
67 8. Reserve for Reprocessing of Irradiated Nuclear Fuel
68 9. Asset Retirement Obligations
10. Short-Term Borrowings
11. Income Taxes
69 12. Equity
71 13. Research and Development Costs
14. Related Party Disclosure
15. Financial Instruments and Related Disclosures
75 16. Derivatives
76 17. Commitments and Contingencies
18. Comprehensive Income
77 19. Segment Information
78 20. Business combination
81 Independent Auditor's Report
82 Nonconsolidated Five-year Financial Summary
83 Nonconsolidated Balance Sheet
85 Nonconsolidated Statement of Operations
Financial Information
Section 1
Kyushu Electric Power Summary
Section 2
Management Message
Section 3
Special Feature
Section 4
Management Base
Kyushu Electric Power Company Annual Report 2015
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Section 5
Financial Information
Consolidated Eleven-year Financial Summary
Kyushu Electric Power Company, Incorporated and Consolidated Subsidiaries
Years Ended March 31
Millions of Yen
For the Year: 2005 2006 2007 2008 2009 2010
Operating revenues . . . . . . . . . . . . . . . . . . 1,408,728円 1,401,751円 1,408,327円 1,482,351円 1,524,193円 1,444,941円
Electric. . . . . . . . . . . . . . . . . . . . . . . . . . . 1,320,581 1,311,995 1,307,737 1,363,423 1,398,577 1,310,085
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . 88,146 89,755 100,590 118,927 125,616 134,856
Operating expenses . . . . . . . . . . . . . . . . . . 1,194,993 1,230,466 1,253,154 1,376,811 1,439,470 1,345,214
Electric. . . . . . . . . . . . . . . . . . . . . . . . . . . 1,107,744 1,140,797 1,155,413 1,260,615 1,317,216 1,220,536
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . 87,249 89,669 97,741 116,195 122,254 124,677
Interest charges . . . . . . . . . . . . . . . . . . . . . 49,522 41,129 38,354 36,937 35,770 35,292
Income (loss) before income
taxes and minority interests . . . . . . . . . . 146,796 120,790 112,887 72,463 55,859 67,610
Income taxes . . . . . . . . . . . . . . . . . . . . . . . 57,857 43,038 46,075 29,853 21,481 25,404
Net income (loss) . . . . . . . . . . . . . . . . . . . . 89,288 76,849 65,967 41,726 33,991 41,812YenPer Share of Common Stock:
Basic net income (loss) . . . . . . . . . . . . . . . 187円.91 161円.67 139円.37 88円.19 71円.84 88円.38
Cash dividends applicable to
the year. . . . . . . . . . . . . . . . . . . . . . . . . . . 60.00 60.00 60.00 60.00 60.00 60.00
At Year-End: Millions of Yen
Total assets. . . . . . . . . . . . . . . . . . . . . . . . . 4,049,713円 4,102,319円 4,038,838円 4,059,775円 4,110,877円 4,054,192円
Net property . . . . . . . . . . . . . . . . . . . . . . . . 3,300,739 3,217,981 3,140,200 3,109,292 3,080,446 3,037,054
Long-term debt, less current portion . . . . 1,739,660 1,724,178 1,689,106 1,712,949 1,811,744 1,724,972
Total equity . . . . . . . . . . . . . . . . . . . . . . . . . 979,251 1,052,785 1,092,600 1,084,212 1,072,374 1,089,066
(U.S. dollar amounts have been translated from yen, for convenience, at the rate of 120円.27 = U.S.1,ドル the approximate rate of exchange at March 31, 2015.)
Note: Figures less than a million yen are rounded down.
Summary of the Year Ended March 31, 2015
Ordinary loss and net loss for the fourth consecutive fiscal year
In the electricity business, the cost of power purchases from renewable energy increased,
and facility checks and repairs at thermal power stations caused maintenance costs to
increase. However, the extent of losses was less than in the preceding fiscal year, as lighting
and power revenue rose due to an increase in electric power rates during the previous year
and the impact of fuel cost adjustments, as well as to a grant based on the act on purchase
of renewable energy.
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Financial Information
Section 3
Special Feature
Section 2
Management Message
Section 4
Management Base
Section 1
Kyushu Electric Power Summary
Kyushu Electric Power Company Annual Report 2015
Millions of Yen
Thousands of
U.S. Dollars
For the Year: 2011 2012 2013 2014 2015 2015
Operating revenues . . . . . . . . . . . . . 1,486,083円 1,508,084円 1,545,919円 1,791,152円 1,873,467円 15,577,184ドル
Electric. . . . . . . . . . . . . . . . . . . . . . 1,354,204 1,367,610 1,406,218 1,633,023 1,719,570 14,297,586
Other . . . . . . . . . . . . . . . . . . . . . . . 131,878 140,474 139,700 158,129 153,897 1,279,597
Operating expenses . . . . . . . . . . . . . 1,387,174 1,692,939 1,845,347 1,886,974 1,916,782 15,937,328
Electric. . . . . . . . . . . . . . . . . . . . . . 1,261,425 1,562,055 1,715,262 1,746,890 1,779,711 14,797,636
Other . . . . . . . . . . . . . . . . . . . . . . . 125,748 130,883 130,085 140,083 137,070 1,139,691
Interest charges . . . . . . . . . . . . . . . . 34,025 34,025 37,407 39,429 40,148 333,821
Income (loss) before income
taxes and minority interests . . . . . 48,318 (214,750) (334,298) (73,732) (72,901) (606,145)
Income taxes . . . . . . . . . . . . . . . . . . 19,245 (48,760) (2,195) 20,786 40,324 335,284
Net income (loss) . . . . . . . . . . . . . . . 28,729 (166,390) (332,470) (96,096) (114,695) (953,653)
Yen U.S. Dollars
Per Share of Common Stock:
Basic net income (loss) . . . . . . . . . . 60円.73 \(351.80) \(702.98) \(203.19) \(242.38) $(2.01)
Cash dividends applicable to
the year. . . . . . . . . . . . . . . . . . . . . . 60.00 50.00
At Year-End: Millions of Yen
Thousands of
U.S. Dollars
Total assets. . . . . . . . . . . . . . . . . . . . 4,185,460円 4,428,093円 4,526,513円 4,549,852円 4,784,735円 39,783,282ドル
Net property . . . . . . . . . . . . . . . . . . . 3,033,125 2,997,232 2,941,114 2,941,142 2,985,935 24,826,938
Long-term debt, less current portion 1,714,429 2,188,601 2,526,729 2,804,896 2,844,538 23,651,269
Total equity . . . . . . . . . . . . . . . . . . . . 1,079,679 888,131 557,799 494,232 450,990 3,749,819
Operating Income (Loss)/Net Income (Loss)
Billions of Yen
Operating Income (Loss) Net Income (Loss)20152014201320122011201020092008200720062005-400-300-200-1000100200300Operating Revenues
Billions of Yen
1,0005001,500
2,000
0 20152014201320122011201020092008200720062005
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Financial Information
Section 3
Special Feature
Section 2
Management Message
Section 4
Management Base
Section 1
Kyushu Electric Power Summary
Kyushu Electric Power Company Annual Report 2015
Management Discussion and Analysis
Kyushu Electric Power Company, Incorporated, and Consolidated Subsidiaries
Year Ended March 31, 2015
Operating Results
In the year ended March 31, 2015, Kyushu Electric
Power recorded a 4.6% year-on-year increase
in operating revenues, to 1,873円.4 billion. In the
electricity business, although the volume of sales
declined, an increase in electricity rates implemented
in the previous fiscal year plus the impact of an
adjustment in fuel costs caused unit charges to
increase, boosting lighting and power revenue. Also,
subsidies related to renewable energy increased.
With regard to expenditures, operating expenses
rose 1.6%, to 1,916円.7 billion. Although Kyushu
Electric Power mounted a groupwide effort to cut
costs, and lower fuel prices reduced fuel costs in
the electricity business, the cost of purchased power
from renewable energy sources increased. Also,
maintenance costs grew due to inspections and repairs
on thermal power stations.
As a result of these factors, performance at the
operating level improved by 52円.5 billion, resulting in
an operating loss of 43円.3 billion.
Other revenues expanded 6.7%, to 16円.5
billion, due to higher foreign exchange gains. Other
expenses declined 8.2%, to 46円.9 billion, due to lower
impairment losses on fixed assets, among other factors.
The ordinary loss improved 57円.7 billion from
the preceding fiscal year, to a loss of 73円.6 billion.
This result stemmed from a 4.6% increase in ordinary
revenues, to 1,890円.0 billion, while ordinary expenses
inched up 1.3%, to 1,963円.7 billion.
The water flow rate rose to 0.7% above average
(100%) during the year under review. For this reason,
Kyushu Electric Power posted a reserve for fluctuations
in water level of 1円.6 billion in preparation for increased
expenses associated with future water shortages.
As one aspect of its management streamlining
efforts, the Company sold off fixed assets whose
divesture would not have a negative impact on the
electric power business. These sales resulted in an
extraordinary gain of 2円.4 billion.
Income taxes increased 19円.5 billion, to 40円.3
billion. This rise was due in part to the impact of a
change in the tax code that drew down deferred tax
assets, causing deferred income taxes to rise.
Due to these factors, the net loss expanded by
18円.5 billion compared with the preceding fiscal year,
to 114円.6 billion. The net loss per share worsened by
39円.19, to 242円.38.
Segment Information
(Before Elimination of Internal Transactions)
(1) Electric Power
The total volume of electrical sales decreased 3.8%,
to 81.27 billion kWh. Contributing to this result was
a 4.9% decrease in general demand, which includes
both domestic lighting and commercial, as cooler
temperatures between May and October reduced air
conditioning demand. Power demand from large-
scale industrial customers was down by 0.9%, as a
fall in demand due to reduced steel production offset
increases in non-ferrous metal production.
On the supply side, the shutdown of nuclear
power plants persisted, but reduced demand and an
increase in power from new energy and other sources
helped to offset this shortfall, and the Company
responded to the remaining difference by adjusting its
thermal power generation. Analysis of the energy mix,
including power generated by Kyushu Electric Power
and power purchased from other companies, shows
that nuclear power accounted for 0%, thermal power
Electric Power
Billions of Yen6000
1,200
1,800-6004000800
1,200-4002011 2012 2013 2014 2015
1,634.8
1,369.5
1,408.3
1,356.3
-121.6
-199.9
-312.686.51,721.8
-68.4
Sales (left) Operating Income (Loss) (right)
Energy-related Business
Billions of Yen100501502000639120
2011 2012 2013 2014 2015
171.010.3164.54.7160.62.5158.03.0186.610.9Sales (left) Operating Income (right)
IT and Telecommunications
Billions of Yen
Sales (left) Operating Income (right)5025751000639120
2011 2012 2013 2014 201596.511.489.711.396.96.694.57.696.26.4
70,000
60,000
50,000
40,000
30,000
20,000
10,000014,000
13,000
12,000
11,000
15,000
16,000
17,00002011201020092008200720062005 2012 2013 2014 2015
Electricity Sales Volume and Peak Load
Millions of kWh Thousands of kW
Peak Load (right) General Demand (left) Large-scale Industrial (left)
57,860
23,419
14,712
58,982
21,217
16,094
60,765
22,191
15,890
60,706
23,693
16,807
62,873
25,209
16,934
61,859
24,024
16,978
60,985
22,407
16,013
63,636
23,838
16,760
61,408
23,944
14,951
60,173
23,614
14,810
60,827
23,623
15,833
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Financial Information
Section 3
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Section 2
Management Message
Section 4
Management Base
Section 1
Kyushu Electric Power Summary
Kyushu Electric Power Company Annual Report 2015
for 86%, hydroelectric for 7% and new energy sources
for 7% of total power.
Electric power segment sales rose 5.3%, to
1,721円.8 billion. Although the volume of sales
declined, an increase in electricity rates implemented
in the previous fiscal year plus the impact of an
adjustment in fuel costs caused unit charges to
increase, boosting lighting and power revenue. Also,
subsidies related to renewable energy increased.
However, operating expenses grew 1.9%, to 1,790円.3
billion. Although lower fuel prices reduced fuel costs,
the cost of purchased power from renewable energy
sources increased. Also, maintenance costs grew due
to inspections and repairs on thermal power stations.
The operating loss consequently decreased by 53円.1
billion, to 68円.4 billion.
(2) Energy-Related Business
Sales increased 9.2% year on year, to 186円.6 billion,
due to increases in power plant maintenance work
and outsourced facility maintenance work. Operating
income grew 5.9%, to 10円.9 billion, owing to higher
cost of sales related to plant construction.
(3) IT and Telecommunications
Sales rose 7.6%, to 96円.5 billion, due to increased
data systems development and higher revenues from
the sale of telecommunication devices. Higher costs
affiliated with broadband services caused operating
income to remain essentially flat, at 11円.4 billion.
(4) Other Business
Sales were 25円.7 billion, down 5.2% year on year, due
to lower revenue stemming from the sale of real estate.
Operating income rose 12.6%, to 3円.6 billion, because
of lower depreciation expenses on rental assets.
Financial Position
(1) Cash Flows
Net cash provided by operating activities came to
88円.7 billion, a 94円.6 billion change from the net
cash used in these activities in the preceding fiscal
year. Although maintenance and other costs related
to electric power caused outflows to increase, cash
inflows benefited from a decrease in thermal fuel costs
and an increase in lighting and power revenue.
Net cash used in investing activities grew 45.1%,
to 268円.4 billion, mainly affected by an increase in
investment in plant and equipment and a decrease in
sales of fixed assets..
Net cash provided by financing activities rose
58.3%, to 310円.8 billion, mainly due to an increase in
proceeds from the issuance of Class A preferred shares.
As a result, cash and cash equivalents on March
31, 2015, stood at 516円.4 billion, up 131円.7 billion
from a year earlier.
(2) Assets, Liabilities and Net Assets
Total assets increased 5.2% year on year, to 4,784円.7
billion. Utility plant, property and equipment decreased
due to ongoing depreciation, but safety enhancement
work at nuclear power plants caused construction in
progress to rise. Also, in current assets the Company
saw an increase in cash and cash and cash equivalents.
Total liabilities grew 6.9%, to 4,333円.7
billion, due to a rise in interest-bearing debt, with
outstanding interest-bearing debt expanding 7.1%, to
3,337円.9 billion.
Net assets benefited from a third-party allocation
(the issuance of 100円.0 billion in Class A preferred
shares to the Development Bank of Japan Inc.).
However, the Company posted a net loss during
the year, and defined retirement benefit plan assets
decreased. As a result, net assets fell by 8.7%, to
450円.9 billion. The equity ratio was 9.0%.
Other
Billions of Yen
Sales (left) Operating Income (right)20103003.01.54.50
2011 2012 2013 2014 201525.73.627.13.227.33.127.22.426.03.3ROA%0-2.52.5-5.0 2011 2012 2013 2014 20151.5-2.7-4.6-1.5 -0.6
Consolidated Interest-bearing Debt and Equity Ratio
Billions of Yen %
5,000
4,000
3,000
2,000
1,000012618243002011201020092008200720062005 2012 2013 2014 2015
Total Assets (left) Interest-bearing Debt (left) Shareholders’ Equity (left) Equity Ratio (right)
431.5
4,784.7
3,337.99.0979.2
4,049.7
2,139.424.21,052.7
4,102.3
2,104.925.71,081.6
4,038.8
2,031.726.81,067.0
4,059.7
2,040.026.31,054.7
4,110.8
2,110.625.71,071.7
4,054.1
2,004.726.41,062.4
4,185.4
2,089.425.4870.3
4,428.0
2,483.219.7539.6
4,526.5
2,910.711.9475.5
4,549.8
3,116.710.5ROE%0-2525
-50 2011 2012 2013 2014 20152.7-17.2
-47.2
-18.9
-25.3
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Kyushu Electric Power Summary
Kyushu Electric Power Company Annual Report 2015
Business risks factors
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 the end of current consolidated fiscal year.1.Changes in systems
affecting the electricity
business
With regard to the matter of electricity system reforms, the new Organization for Cross-regional Coordina-
tion of Transmission Operators was established in April 2015, and the full liberalization of the electricity retail
market will begin in 2016. In addition, at the national government level, discussions are underway on mea-
sures to ensure further neutrality of power transmission and distribution, to be taken starting in 2020. We will
steadily put in place the new internal systems required by these system changes and work to achieve greater
operational efficiency.
The government has also approved the Basic Energy Plan, which established the nation’s basic orientation
in relation to energy supply and demand in cabinet and progressing with deliberations such as the best mix of
energy in the future.
Changes such as these to the systems affecting the electricity business could have an impact on the
Group’s performance.2.Status of environment
surrounding nuclear
power
We still believe that nuclear power generation is important in terms of energy security and global warming con-
cerns. We will comply with the New Nuclear Regulatory Requirements enforced by the government based on the
lessons learned from the accident at the Fukushima Daiichi Nuclear Power Station and continue our voluntary
efforts in order to improve the safety and reliability. At the same time, we will work to ease the concerns of local
residents regarding nuclear power generation.
However, depending on the status of operation of our nuclear power stations as it will be affected by the
future trends in regulations (the progress of governmental studies towards restart, etc.) and other factors, it is
possible that the results of the Kyushu Electric Group will be affected by factors including increases in costs
such as fuel costs and the cost of procuring funds resulting from the continuation of these cost burdens.3.Fluctuations in
electricity sales volume
Electricity sales volume in the electricity business fluctuates according to factors such as economic trends,
temperature changes, the spread of residential solar power systems, the develop of energy conservation, and
the states of competition in electricity power market. As a result, changes in these factors could have an impact
on the Group’s performance.
4. Fuel 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 helps to ease the impact of fuel price volatility on the Group’s performance.5.Costs for the back end
of nuclear operations
The decommissioning of nuclear facilities and the back end of nuclear operations such as the storage, repro-
cessing, and disposal of spent nuclear fuel require super long-term projects that involve uncertainties.
However, risks to operator have been reduced to a certain extent due to the government’s institutional
measures and other factors. Since the costs for the back end of nuclear operations and so forth vary in accor-
dance with factors such as future reviews of systems, changes to estimated future expenses, and the storage
conditions of spent nuclear fuel, however, they may affect the business performance of the Kyuden Group.
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Management Message
Section 4
Management Base
Section 1
Kyushu Electric Power Summary
Kyushu Electric Power Company Annual Report 20156.Cost of Measures to
Combat Global Warming
In response to global warming, the Group aims for more efficient power generation that uses less carbon, and
to this end the Group conducts a variety of measures, such as safe and stable nuclear power station operations,
active development and introduction of renewable energy, and maintenance and improvement of total thermal
efficiency for thermal power stations. Future changes in policies related to global warming could have an impact
on the Group’s performance.7.Businesses Other than
Electricity
The Group is enhancing its revenue basis by utilizing the group’s management resources and steadily develop-
ing new business area beyond electricity business. In the business operation, we put emphasis on the profit-
ability 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 Group’s performance may be affected.
8. Deferred Tax Assets
The recoverability of deferred tax assets reported in the consolidated balance sheet is determined based on esti-
mated future taxable income. Therefore, if estimated future taxable income falls due to factors such as changes
in the business environment, we will have to break into deferred tax assets, and this may affect the business
performance of the Kyuden Group.9.Interest Rate
Fluctuations
The Group’s balance of interest-bearing debt as of the end of March 2015 is 3,337円.9 billion, which accounts
for 70% of total assets of the group. Future changes in interest rates have potential to affect the Group’s
financial condition.
However, 96% 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 the Group’s performance is therefore viewed
as limited.
10. Leakage of Information
The Group has established strict internal frameworks to manage in-house information and personal informa-
tion, 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 caused by such as the
infection with a virus and the cyber attacks, the Group’s performance may be affected.
11. Natural Disasters
To ensure a stable supply of electricity to our customers, the 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 Group’s performance.
We are also developing a risk management system and are preparing for numerous risks that may have a
material impact on business operations. Proper actions not taken in response to a risk may adversely affect the
Group’s performance.
12. Compliance
To be worthy of the trust of all its stakeholders, the Group conducts its business activities from the perspective
of its customers and local people in the regions it operate in by working together to fully instill an awareness of
compliance and complying with laws and regulations. However, if problems such as compliance violations were
to cause the Group’s social credibility to decline, this could have an impact on the Group’s performance.
The Group will continue to work to build trust-based relationships with all its stakeholders.
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Management Base
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Kyushu Electric Power Summary
Kyushu Electric Power Company Annual Report 2015
Consolidated Balance Sheet
Kyushu Electric Power Company, Incorporated and Consolidated Subsidiaries
March 31, 2015
Millions of Yen
Thousands of U.S.
Dollars (Note 1)
2015 2014 2015
ASSETS
PROPERTY (Note 3):
Plant and equipment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9,692,661円 9,668,646円 80,590,845ドル
Construction in progress. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 410,049 329,749 3,409,407
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10,102,710 9,998,396 84,000,252
Less-
Contributions in aid of construction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 173,124 163,824 1,439,469
Accumulated depreciation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6,943,649 6,893,429 57,733,844
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7,116,774 7,057,253 59,173,313
Net property. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,985,935 2,941,142 24,826,938
NUCLEAR FUEL. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 280,616 281,522 2,333,217
INVESTMENTS AND OTHER ASSETS:
Investment securities (Notes 4 and 15) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 85,178 85,275 708,224
Investments in and advances to nonconsolidated subsidiaries
and affiliated companies (Note 15) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
102,960 102,311 856,080
Reserve funds for reprocessing of irradiated nuclear fuel
(Notes 8 and 15) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
282,071 261,058 2,345,316
Assets for retirement benefits (Note 7) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14,925 239 124,102
Deferred tax assets (Note 11) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 127,072 146,426 1,056,562
Special account related to nuclear power decommissioning (Note. 2.g) . . . . . . . . . . 21,692 180,365
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25,266 29,229 210,083
Total investments and other assets. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 659,168 624,541 5,480,736
CURRENT ASSETS:
Cash and cash equivalents (Note 15) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 516,480 384,769 4,294,338
Receivables (Note 15) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 199,707 183,568 1,660,494
Allowance for doubtful accounts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (822) (855) (6,841)
Inventories, principally fuel. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 81,433 82,559 677,091
Deferred tax assets (Note 11) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34,068 33,137 283,266
Prepaid expenses and other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28,147 19,466 234,039
Total current assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 859,015 702,644 7,142,389
TOTAL. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,784,735円 4,549,852円 39,783,282ドル
See notes to consolidated financial statements.
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Section 5
Financial Information
Section 3
Special Feature
Section 2
Management Message
Section 4
Management Base
Section 1
Kyushu Electric Power Summary
Kyushu Electric Power Company Annual Report 2015
Millions of Yen
Thousands of U.S.
Dollars (Note 1)
2015 2014 2015
LIABILITIES AND EQUITY
LONG-TERM LIABILITIES:
Long-term debt, less current portion (Notes 6 and 15) . . . . . . . . . . . . . . . . . . . . . . . . 2,844,538円 2,804,896円 23,651,269ドル
Liability for retirement benefits (Note 7) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 90,547 51,237 752,870
Reserve for reprocessing of irradiated nuclear fuel (Note 8). . . . . . . . . . . . . . . . . . . . 322,666 332,882 2,682,853
Asset retirement obligations (Note 9) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 207,437 202,989 1,724,763
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34,706 37,831 288,569
Total long-term liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,499,896 3,429,837 29,100,326
CURRENT LIABILITIES:
Current portion of long-term debt (Notes 6 and 15). . . . . . . . . . . . . . . . . . . . . . . . . . . 382,425 204,144 3,179,723
Short-term borrowings (Notes 10 and 15) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 119,901 118,521 996,933
Notes and accounts payable (Notes 14 and 15) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 160,392 167,725 1,333,601
Accrued income taxes (Note 15) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,453 3,448 37,028
Accrued expenses. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 98,461 83,719 818,666
Deferred tax liabilities (Note 11) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 66 74 549
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 66,456 48,148 552,562
Total current liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 832,156 625,782 6,919,065
RESERVE FOR FLUCTUATIONS IN WATER LEVEL . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,692 14,070
COMMITMENTS AND CONTINGENCIES (Note 17)
EQUITY (Note 12):
Common stock,
authorized, 1,000,000,000 shares; issued,
474,183,951 shares in 2015 and 2014 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 237,304 237,304 1,973,101
Preferred stock,
authorized, 1,000 shares; issued,
1,000 shares in 2015 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Capital surplus . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 130,344 31,130 1,083,764
Retained earnings. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60,175 174,871 500,336
Treasury stock-at cost,
509,481 shares in 2015 and 1,214,196 shares in 2014 . . . . . . . . . . . . . . . . . . . . (666) (2,340) (5,545)
Accumulated other comprehensive income:
Unrealized gain on available-for-sale securities. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,097 2,352 34,070
Deferred gain on derivatives under hedge accounting . . . . . . . . . . . . . . . . . . . . . . . 596 4,235 4,961
Foreign currency translation adjustments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (18) (450) (152)
Defined retirement benefit plans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (305) 28,429 (2,537)
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 431,528 475,533 3,587,998
Minority interests . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19,462 18,699 161,821
Total equity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 450,990 494,232 3,749,819
TOTAL. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,784,735円 4,549,852円 39,783,282ドル
See notes to consolidated financial statements.
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Section 5
Financial Information
Section 3
Special Feature
Section 2
Management Message
Section 4
Management Base
Section 1
Kyushu Electric Power Summary
Kyushu Electric Power Company Annual Report 2015
Consolidated Statement of Operations
Kyushu Electric Power Company, Incorporated and Consolidated Subsidiaries
Year Ended March 31, 2015
Millions of Yen
Thousands of U.S.
Dollars (Note 1)
2015 2014 2015
OPERATING REVENUES:
Electric . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,719,570円 1,633,023円 14,297,586ドル
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 153,897 158,129 1,279,597
Total operating revenues. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,873,467 1,791,152 15,577,184
OPERATING EXPENSES (Note 13):
Electric . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,779,711 1,746,890 14,797,636
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 137,070 140,083 1,139,691
Total operating expenses. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,916,782 1,886,974 15,937,328
OPERATING LOSS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (43,314) (95,821) (360,144)
OTHER EXPENSES (INCOME):
Interest charges . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40,148 39,429 333,821
Foreign exchange gain . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (2,227) (1,398) (18,524)
Gain on sales of fixed assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (2,484) (26,173) (20,659)
Gain on sales of investment securities (Note 4). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (5,524)
Gain on contribution of securities to retirement benefit trust (Note 4). . . . . . . . . . . . (21,711)
Other-net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (7,541) (2,402) (62,706)
Total other expenses (income)-net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27,894 (17,780) 231,930
LOSS BEFORE INCOME TAXES AND PROVISION FOR (REVERSAL OF) RESERVE
FOR FLUCTUATIONS IN WATER LEVEL AND MINORITY INTERESTS . . . . . . . . . . . . . . . . (71,208) (78,040) (592,074)
PROVISION FOR (REVERSAL OF) RESERVE FOR FLUCTUATIONS IN WATER LEVEL . . . . 1,692 (4,308) 14,070
LOSS BEFORE INCOME TAXES AND MINORITY INTERESTS . . . . . . . . . . . . . . . . . . . . . . (72,901) (73,732) (606,145)
INCOME TAXES (Note 11):
Current. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7,114 5,131 59,153
Deferred. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33,210 15,655 276,131
Total income taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40,324 20,786 335,284
NET LOSS BEFORE MINORITY INTERESTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (113,225) (94,519) (941,429)
MINORITY INTERESTS IN NET INCOME OF CONSOLIDATED SUBSIDIARIES. . . . . . . . . . (1,470) (1,576) (12,223)
NET LOSS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . \ (114,695) \ (96,096) $ (953,653)
Yen U.S. Dollars
PER SHARE OF COMMON STOCK (Note 2.s):
Basic net loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . \(242.38) \(203.19) $(2.01)
Cash dividends applicable to the year. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
See notes to consolidated financial statements.
Section 5
Financial Information
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Section 3
Special Feature
Section 2
Management Message
Section 4
Management Base
Section 1
Kyushu Electric Power Summary
Consolidated Statement of Comprehensive Income
Kyushu Electric Power Company, Incorporated and Consolidated Subsidiaries
Year Ended March 31, 2015
Millions of Yen
Thousands of U.S.
Dollars (Note 1)
2015 2014 2015
NET LOSS BEFORE MINORITY INTERESTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . \(113,225) \ (94,519) $ (941,429)
OTHER COMPREHENSIVE LOSS (Note 18):
Unrealized gain (loss) on available-for-sale securities . . . . . . . . . . . . . . . . . . . . . . . . . 1,188 (16,670) 9,878
Deferred (loss) gain on derivatives under hedge accounting . . . . . . . . . . . . . . . . . . . (1,759) 464 (14,626)
Foreign currency translation adjustments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (25) (1,429) (209)
Defined retirement benefit plans. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (28,192) (683) (234,411)
Share of other comprehensive (loss) income in
nonconsolidated subsidiaries and affiliated companies. . . . . . . . . . . . . . . . . . . . . . . (1,171) 2,816 (9,741)
Total other comprehensive loss. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (29,960) (15,503) (249,109)
COMPREHENSIVE LOSS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . \(143,186) \(110,023) $(1,190,539)
TOTAL COMPREHENSIVE LOSS ATTRIBUTABLE TO:
Owners of the parent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . \(144,891) \(111,780) $(1,204,719)
Minority interests . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,705 1,757 14,180
See notes to consolidated financial statements.
54/90
Section 5
Financial Information
Section 3
Special Feature
Section 2
Management Message
Section 4
Management Base
Section 1
Kyushu Electric Power Summary
Kyushu Electric Power Company Annual Report 2015
Consolidated Statement of Changes in Equity
Kyushu Electric Power Company, Incorporated and Consolidated Subsidiaries
Year Ended March 31, 2015
Thousands of Shares/Millions of Yen
Common Stock Preferred Stock
Capital
Surplus
Retained
Earnings
Treasury Stock Accumulated Other Comprehensive Income
Total
Minority
Interests Total Equity
Shares Amount Shares Amount Shares Amount
Unrealized
Gain on
Available-
for-Sale
Securities
Deferred
Gainon
Derivatives
underHedge
Accounting
Foreign
Currency
Translation
Adjustments
Defined
Retirement
Benefit
Plans
BALANCE AT APRIL 1, 2013 . . . . . . 474,183 237,304円 \ 31,130 \ 252,145 1,246 \(2,373) \ 19,212 \ 3,747 \(1,481) \ 539,684 18,114円 \ 557,799
Cumulative effects of changes in
accounting policies . . . . . . . . . . . 18,822 \ 28,773 47,596 (291) 47,304
Restated Balance. . . . . . . . . . . . . . . 474,183 237,304円 \ 31,130 270,967円 1,246 \(2,373) \ 19,212 \ 3,747 \(1,481) \ 28,773 \ 587,280 17,822円 \ 605,103
Net loss . . . . . . . . . . . . . . . . . . . . . (96,096) (96,096) (96,096)
Purchase of treasury stock. . . . . . 14 (18) (18) (18)
Disposal of treasury stock . . . . . . (47) 51 51 51
Net change in the year . . . . . . . . . (16,859) 488 1,031 (344) (15,684) 876 (14,807)
BALANCE AT MARCH 31, 2014. . . . 474,183 237,304円 \ 31,130 \ 174,871 1,214 \(2,340) \ 2,352 \ 4,235 \ (450) 28,429円 \ 475,533 18,699円 \ 494,232
Issuance of preferred stock
(Note 12). . . . . . . . . . . . . . . . . . . . 1 \ 50,000 50,000 100,000 100,000
Transfer from preferred stock
to capital surplus (Note 12). . . . . (50,000) 50,000
Net loss . . . . . . . . . . . . . . . . . . . . . (114,695) (114,695) (114,695)
Purchase of treasury stock. . . . . . 13 (14) (14) (14)
Disposal of treasury stock . . . . . . (303) (254) 580 277 277
Changes by share exchange
(Note 20.a) . . . . . . . . . . . . . . . . . . (482) (463) 1,107 624 624
Net change in the year . . . . . . . . . 1,745 (3,639) 432 (28,734) (30,195 ) 762 (29,433)
BALANCE AT MARCH 31, 2015. . . . 474,183 237,304円 1 \ 130,344円 \ 60,175 509 \ (666) \ 4,097 \ 596 \ (18) \ (305) \ 431,528 19,462円 \ 450,990
Thousands of U.S. Dollars (Note 1)
Common
Stock
Preferred
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 on
Derivatives
under
Hedge
Accounting
Foreign
Currency
Translation
Adjustments
Defined
Retirement
Benefit
Plans
BALANCE AT MARCH 31, 2014. . . . . . . . . . . . 1,973,101ドル $ 258,838 1,453,990ドル $(19,458) 19,559ドル 35,219ドル $(3,748)236,377ドル 3,953,880ドル 155,480ドル 4,109,361ドル
Issuance of preferred stock
(Note 12). . . . . . . . . . . . . . . . . . . . . . . . . . . . 415,731ドル 415,731 831,462 831,462
Transfer from preferred stock
to capital surplus (Note 12). . . . . . . . . . . . . (415,731) 415,731
Net loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (953,653) (953,653) (953,653)
Purchase of treasury stock. . . . . . . . . . . . . . (122) (122) (122)
Disposal of treasury stock . . . . . . . . . . . . . . (2,521) 4,828 2,307 2,307
Changes by share exchange
(Note 20.a) . . . . . . . . . . . . . . . . . . . . . . . . . . (4,015) 9,206 5,190 5,190
Net change in the year . . . . . . . . . . . . . . . . . 14,511 (30,257) 3,595 (238,915) (251,066) 6,340 (244,726)
BALANCE AT MARCH 31, 2015. . . . . . . . . . . . 1,973,101ドル $ 1,083,764ドル $ 500,336 $ (5,545) 34,070ドル $ 4,961 $ (152)$ (2,537) 3,587,998ドル 161,821ドル 3,749,819ドル
See notes to consolidated financial statements.
55/90
Section 5
Financial Information
Section 3
Special Feature
Section 2
Management Message
Section 4
Management Base
Section 1
Kyushu Electric Power Summary
Kyushu Electric Power Company Annual Report 2015
Consolidated Statement of Cash Flows
Kyushu Electric Power Company, Incorporated and Consolidated Subsidiaries
Year Ended March 31, 2015
Millions of Yen
Thousands of U.S.
Dollars (Note 1)
2015 2014 2015
CASH FLOWS FROM OPERATING ACTIVITIES:
Loss before income taxes and minority interests. . . . . . . . . . . . . . . . . . . . . . . . . . . . . \ (72,901) \ (73,732) $ (606,145)
Adjustments for:
Income taxes paid . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (5,812) (3,965) (48,331)
Depreciation and amortization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 193,972 202,856 1,612,811
Decommissioning costs of nuclear power units . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,293 1,978 35,700
Reversal of reserve for reprocessing of irradiated nuclear fuel . . . . . . . . . . . . . . . . (12,770) (14,031) (106,181)
Loss on disposal of plant and equipment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6,643 6,438 55,236
Provision for (reversal of) reserve for fluctuation in water level . . . . . . . . . . . . . . . . 1,692 (4,308) 14,070
Gain on sales of fixed assets. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (2,484) (26,173) (20,659)
Gain on sales of investment securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (5,524)
Gain on contributions of securities to retirement benefit trust . . . . . . . . . . . . . . . . (21,711)
Changes in assets and liabilities:
Increase in reserve funds for reprocessing of irradiated nuclear fuel . . . . . . . . . (21,012) (20,902) (174,712)
Increase in trade receivables. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (15,489) (40,493) (128,793)
Decrease (increase) in inventories, principally fuel . . . . . . . . . . . . . . . . . . . . . . . . 1,125 (9,481) 9,356
Increase (decrease) in trade payables . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,697 (5,534) 14,115
Decrease in liability for retirement benefits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (5,823) (10,577) (48,419)
Other-net. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15,606 19,239 129,762
Total adjustments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 161,637 67,809 1,343,957
Net cash provided by (used in) operating activities. . . . . . . . . . . . . . . . . . . . . . . 88,736 (5,922) 737,811
CASH FLOWS FROM INVESTING ACTIVITIES:
Capital expenditures including nuclear fuel . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (293,944) (236,378) (2,444,040)
Proceeds from contribution in aid of construction . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23,259 12,858 193,395
Proceeds from sales of fixed assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,137 27,591 26,086
Payments for investments and advances. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (679) (2,966) (5,649)
Proceeds from sales of investment securities and collections of advances . . . . . . . 3,181 14,845 26,453
Other-net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (3,367) (914) (28,002)
Net cash used in investing activities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (268,413) (184,963) (2,231,755)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from issuance of bonds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 139,570 194,488 1,160,480
Repayments of bonds. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (99,800) (163,842) (829,799)
Proceeds from long-term loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 275,475 280,344 2,290,476
Repayments of long-term loans. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (102,184) (76,447) (849,628)
Net increase (decrease) in short-term borrowings . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,379 (1,011) 11,471
Net decrease in commercial paper . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (33,000)
Proceeds from issuance of preferred stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 99,597 828,116
Other-net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (3,231) (4,134) (26,867)
Net cash provided by financing activities. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 310,807 196,397 2,584,250
FOREIGN CURRENCY TRANSLATION ADJUSTMENTS ON CASH AND CASH EQUIVALENTS 579 51 4,816
NET INCREASE IN CASH AND CASH EQUIVALENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 131,710 5,561 1,095,123
CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR. . . . . . . . . . . . . . . . . . . . . . . . 384,769 379,207 3,199,215
CASH AND CASH EQUIVALENTS AT END OF YEAR . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . \ 516,480 \ 384,769 $ 4,294,338
See notes to consolidated financial statements.
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Kyushu Electric Power Company Annual Report 2015
1. BASIS OF PRESENTING CONSOLIDATED FINANCIAL STATEMENTS
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
accordance with accounting principles generally accepted in Japan, 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.
In preparing these consolidated financial statements, certain reclas-
sifications 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, 2014, to conform to the classifications used in the consolidated
financial statements for the year ended March 31, 2015.
The U.S. dollar amounts included herein are provided solely for the
convenience of readers outside Japan and are stated at the rate of 120円.27
= U.S. 1,ドル the approximate exchange rate prevailing on March 31, 2015. The
translations should not be construed as representations that the Japanese yen
amounts could be converted into U.S. dollars at that or any other rate.
Japanese yen figures less than a million yen are rounded down to the
nearest million yen, except for per share data. As a result, the totals shown
in the accompanying consolidated financial statements (both in yen and U.S.
dollars) do not necessarily agree with the sum of the individual amounts.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
a. Consolidation and Application of the Equity Method— The consolidated
financial statements as of March 31, 2015, include the accounts of the
Company and its 40 subsidiaries (together, the "Companies"). All significant
intercompany transactions and balances have been eliminated in consolidation.
Investments in 15 (17 for 2014) nonconsolidated subsidiaries and 14 affiliated
companies are accounted for by the equity method.
The Company adopts the control and influence concepts. Under these
concepts, 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.
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 four consolidated subsidiaries and several noncon-
solidated subsidiaries and affiliated companies is December 31. The Company
consolidates such consolidated subsidiaries’ financial statements and accounts
for investments in such nonconsolidated 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— Major requirements under Accounting Standards
Board of Japan (the "ASBJ") Statement No. 21, "Accounting Standard for
Business Combinations" are as follows: (a) The standard requires account-
ing for business combinations only by the purchase method. (b) Under the
standard, in-process research and development acquired in the business
combination are capitalized as an intangible asset. (c) Under the 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 price allocation.
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
related to transmission lines is computed using the straight-line method
based on the estimated useful lives of the transmission lines.
Under the accounting regulations, applicable to electric utillity providers
properties, which are required for decommissioning of nuclear power units
or which need maintenance and management even after nuclear power units
have been in the process of decommissioning, are to be included in "Plant
and equipment."
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
Notes to Consolidated Financial Statements
Kyushu Electric Power Company, Incorporated and Consolidated Subsidiaries
Year Ended March 31, 2015
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impairment loss would be recognized if the 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 account-
ed for, depending on management’s intent, as follows:
(a) Held-to-maturity debt securities are stated at cost with discounts or premi-
ums amortized throughout the holding periods; (b) Available-for-sale securi-
ties, which are not classified as the aforementioned securities and investment
securities in nonconsolidated subsidiaries and affiliated companies, are stated
at market value; and nonmarketable securities 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. Special account related to nuclear power decommissioning
On March 13, 2015, the Japanese government, i.e., the Ministry of Economy,
Trade and Industry ("METI"), revised the accounting regulation applicable
to electric utility providers. Relating to accounting treatments in case the
Company decides to decommission nuclear power units due to factors such
as a change of the government’s energy policy, prior to March 13, 2015, the
Company recorded losses on the write-off of carrying amounts of nuclear
power units (excluding for properties required for decommissioning of nuclear
power unit or need maintenance and management even after nuclear power
units have been in process of decommissioning and assets retirement
costs), construction in progress and nuclear fuel ("carrying amounts related
to nuclear power units"), and reprocessing costs of irradiated nuclear fuel
and costs of separating the components of nuclear fuel ("costs related to
nuclear power decommissioning") at one time when the Company decided to
decommission. Under the revised accounting regulation, on and after March
13, 2015, the Company is permitted to transfer the carrying amounts related
to nuclear power units and costs related to nuclear power decommission-
ing to "special account related to nuclear power decommissioning" when
the Company decides to decommission nuclear power units and applies to
the Minister of METI for adopting the above special account, because they
are expected to be collected through regulated electricity fees. The special
account is amortized in proportion to the amounts of future regulated electric-
ity fees collected, after approval of the Minister of METI.
On March 18, 2015, the Company decided to decommission No. 1 unit
of its Genkai nuclear power station. According to the revised accounting
regulation, with respect to the No. 1 unit of its Genkai nuclear power station,
the Company transferred the carrying amounts related to nuclear power units
of 15,317円 million (127,358ドル thousand) and costs related to nuclear power
decommissioning of 6,375円 million (53,006ドル thousand), totaling 21,692円
million (180,365ドル thousand), to "special account related to nuclear power
decommissioning"presented in investments and other assets. On April 21,
2015 the Minister of METI approved the application for adopting the special
accounting treatment which the Company submitted.
As a result, loss before income taxes and minority interests decreased
by 21,692円 million (180,365ドル thousand), and basic net loss per share
decreased by 32円.68 (0ドル.27) for the year ended March 31, 2015.
h. 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 fund
investments in bonds that represent short-term investments, all of which
mature or become due within three months of the date of acquisition.
i. Inventories— Inventories are stated at the lower of cost, principally
determined by the average method, or net selling value.
j. Foreign Currency Transactions— Receivables and payables denominated
in foreign currencies are translated into Japanese yen at the rates in effect as
of each balance sheet date.
k. Foreign Currency Financial Statements— The balance sheet accounts of
the consolidated foreign subsidiaries, and nonconsolidated foreign subsidiar-
ies 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 are shown as "Foreign currency
translation adjustments" under accumulated other comprehensive income in
a separate component of equity.
Revenue and expense accounts of consolidated foreign subsidiaries are
translated into yen at the average exchange rate.
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l. Derivatives and Hedging Activities— Derivative financial instruments 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 consolidated statement of opera-
tions and (b) for such 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 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.
m. 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.
Effective April 1, 2000, the Companies adopted a new accounting
standard for retirement benefits and accounted for the liability for retire-
ment benefits based on the projected benefit obligations and plan assets at
the balance sheet date. The projected benefit obligations are attributed to
periods on a straight-line basis. Actuarial gains and losses are amortized on
a straight-line basis over mainly 5 years within the average remaining service
period. Past service costs are amortized on a straight-line basis over mainly 5
years within the average remaining service period.
In May 2012, the ASBJ issued ASBJ Statement No. 26, "Accounting
Standard for Retirement Benefits" and ASBJ Guidance No. 25, "Guidance on
Accounting Standard for Retirement Benefits," which replaced the account-
ing standard for retirement benefits that had been issued by the Business
Accounting Council in 1998 with an effective date of April 1, 2000, and the
other related practical guidance, and were followed by partial amendments
from time to time through 2009.
(a) Under the revised accounting standard, actuarial gains and losses and
past service costs that are yet to be recognized in profit or loss are
recognized within equity (accumulated other comprehensive income),
after adjusting for tax effects, and any resulting deficit or surplus is
recognized as a liability (liability for retirement benefits) or asset (asset
for retirement benefits).
(b) The revised accounting standard does not change how to recognize
actuarial gains and losses and past service costs in profit or loss. Those
amounts are recognized in profit or loss over a certain period no longer
than the expected average remaining service period of the employees.
However, actuarial gains and losses and past service costs that arose in
the current period and have not yet been recognized in profit or loss are
included in other comprehensive income and actuarial gains and losses
and past service costs that were recognized in other comprehensive
income in prior periods and then recognized in profit or loss in the cur-
rent period shall be treated as reclassification adjustments.
(c) The revised accounting standard also made certain amendments relating
to the method of attributing expected benefit to periods and relating to
the discount rate and expected future salary increases.
This accounting standard and the guidance for (a) and (b) above are
effective for the end of annual periods beginning on or after April 1, 2013,
and for (c) above are effective for the beginning of annual periods beginning
on or after April 1, 2014, or for the beginning of annual periods beginning
on or after April 1, 2015, subject to certain disclosure in March 2015, both
with earlier application being permitted from the beginning of annual periods
beginning on or after April 1, 2013. However, no retrospective application of
this accounting standard to consolidated financial statements in prior periods
is required.
The Companies early applied the revised accounting standard and guid-
ance for retirement benefits for (a), (b) and (c) above effective April 1, 2013, and
changed the method of attributing expected benefit to periods from a straight-
line basis to a benefit formula basis.The Companies recorded the effect of (a)
and (b) above as of April 1, 2013, in accumulated other comprehensive income,
and the effect of (c) above as of April 1, 2013, in retained earnings.
n. Reserve for Reprocessing of Irradiated Nuclear Fuel— This reserve is
provided for reprocessing costs of irradiated nuclear fuel. The annual provi-
sion is calculated in accordance with the accounting regulations set by the
Japanese Government applicable to electric utility providers in Japan.
o. Asset Retirement Obligations— Under ASBJ Statement No. 18, "Account-
ing Standard for Asset Retirement Obligations," 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
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Company recognizes the asset retirement obligation as the sum of the future
decommissioning costs of nuclear power unit imposed by the "Law on the
Regulation of Nuclear Source Material, Nuclear Fuel Material and Reactors,"
discounted at 2.3%.
On October 1, 2013, the METI revised the accounting regulations and
related regulations concerning allocation of asset retirement costs of nuclear
power units. Prior to October 1, 2013, asset retirement costs of nuclear
power units were allocated to expense through depreciation based on a
proportion of the current generation of electric power to the estimated total
life-time generation of electric power of each unit. Effective October 1, 2013,
the asset retirement costs are allocated to expense through depreciation
based on the straight-line method over a period totaling the remaining useful
life and expected safe storage period.
p. Income Taxes— The provision for income taxes is computed based on
the pretax income included in the consolidated statement of operations. 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.
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") are computed by dividing net income available to common sharehold-
ers 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, 2015 and
2014, because potentially dilutive securities were not outstanding.
Cash dividends per share represent actual amounts applicable to earn-
ings of the respective years.
t. Research and Development Costs— Research and development costs are
charged to income as incurred.
u. New Accounting Pronouncements
Accounting Standards for Business Combinations and Consolidated Financial
Statements— On September 13, 2013, the ASBJ issued revised ASBJ
Statement No. 21, "Accounting Standard for Business Combinations," revised
ASBJ Guidance No. 10, "Guidance on Accounting Standards for Business
Combinations and Business Divestitures," and revised ASBJ Statement No.
22, "Accounting Standard for Consolidated Financial Statements."
Major accounting changes are as follows:
(a) Transactions with noncontrolling interest
A parent’s ownership interest in a subsidiary might change if the parent
purchases or sells ownership interests in its subsidiary. The carrying
amount of minority interest is adjusted to reflect the change in the
parent’s ownership interest in its subsidiary while the parent retains
its controlling interest in its subsidiary. Under the current accounting
standard, any difference between the fair value of the consideration
received or paid and the amount by which the minority interest is
adjusted is accounted for as an adjustment of goodwill or as profit or loss
in the consolidated statement of operation. Under the revised accounting
standard, such difference shall be accounted for as capital surplus as
long as the parent retains control over its subsidiary.
(b) Presentation of the consolidated balance sheet
In the consolidated balance sheet, "minority interest" under the current
accounting standard will be changed to "noncontrolling interest" under
the revised accounting standard.
(c) Presentation of the consolidated statement of operations
In the consolidated statement of operations, "income before minority
interest" under the current accounting standard will be changed to "net
income" under the revised accounting standard, and "net income" under
the current accounting standard will be changed to "net income attribut-
able to owners of the parent" under the revised accounting standard.
(d) Provisional accounting treatments for a business combination
If the initial accounting for a business combination is incomplete by
the end of the reporting period in which the business combination
occurs, an acquirer shall report in its financial statements provisional
amounts for the items for which the accounting is incomplete. Under
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the current accounting standard guidance, the impact of adjustments to
provisional amounts recorded in a business combination on profit or loss
is recognized as profit or loss in the year in which the measurement is
completed. Under the revised accounting standard guidance, during the
measurement period, which shall not exceed one year from the acquisi-
tion, the acquirer shall retrospectively adjust the provisional amounts
recognized at the acquisition date to reflect new information obtained
about facts and circumstances that existed as of the acquisition date and
that would have affected the measurement of the amounts recognized as
of that date. Such adjustments shall be recognized as if the accounting
for the business combination had been completed at the acquisition date.
(e) Acquisition-related costs
Acquisition-related costs are costs, such as advisory fees or professional
fees, which an acquirer incurs to effect a business combination. Under
the current accounting standard, the acquirer accounts for acquisition-
related costs by including them in the acquisition costs of the investment.
Under the revised accounting standard, acquisition-related costs shall be
accounted for as expenses in the periods in which the costs are incurred.
The above accounting standards and guidance for transactions with
noncontrolling interest, presentation of the consolidated balance sheet,
presentation of the consolidated statement of operations, and acquisition-
related costs are effective for the beginning of annual periods beginning on
or after April 1, 2015. Earlier application is permitted from the beginning of
annual periods beginning on or after April 1, 2014, except for presentation
of the consolidated balance sheet and presentation of the consolidated
statement of operations. In the case of earlier application, all accounting
standards and guidance above, except for presentation of the consolidated
balance sheet and presentation of the consolidated statement of operations,
should be applied simultaneously.
Either retrospective or prospective application of the revised accounting
standards and guidance for transactions with noncontrolling interest and
acquisition-related costs is permitted. In retrospective application of the
revised standards and guidance, the accumulated effects of retrospective
adjustments for all transactions with noncontrolling interest and acquisition-
related costs which occurred in the past shall be reflected as adjustments to
the beginning balance of capital surplus and retained earnings for the year of
the first-time application. In prospective application, the new standards and
guidance shall be applied prospectively from the beginning of the year of the
first-time application.
The revised accounting standards and guidance for presentation of the
consolidated balance sheet and presentation of the consolidated statement
of operations shall be applied to all periods presented in financial statements
containing the first-time application of the revised standards and guidance.
The revised standards and guidance for provisional accounting
treatments for a business combination are effective for a business
combination which occurs on or after the beginning of annual periods
beginning on or after April 1, 2015. Earlier application is permitted for a
business combination which occurs on or after the beginning of annual
periods beginning on or after April 1, 2014.
The Companies expect to apply the revised accounting standards and
guidance for transactions with noncontrolling interest, presentation of the
consolidated balance sheet, presentation of the consolidated statement
of operations and acquisition-related above from April 1, 2015, and for
provisional accounting treatments for a business combination above for a
business combination which will occur on or after April 1, 2015, and are
in the process of measuring the effects of applying the revised accounting
standards and guidance in future applicable periods.
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3. PROPERTY
The breakdown of property at March 31, 2015 and 2014, was as follows:
Millions of Yen
Thousands of
U.S. Dollars
2015 2014 2015
Costs:
Electric power production facilities:
Hydroelectric power . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . \ 798,893 \ 805,336 $ 6,642,503
Thermal power . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,473,210 1,469,915 12,249,195
Nuclear power . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,611,295 1,630,816 13,397,316
Internal-combustion engine power . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 130,217 129,138 1,082,709
Renewable power. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 111,190 108,990 924,510
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,124,808 4,144,197 34,296,236
Transmission facilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,779,845 1,759,126 14,798,748
Transformation facilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 994,549 978,919 8,269,305
Distribution facilities. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,409,711 1,389,531 11,721,220
General facilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 393,145 384,405 3,268,853
Other electricity-related facilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,782 5,782 48,075
Other plant and equipment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 984,819 1,006,683 8,188,404
Construction in progress. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 410,049 329,749 3,409,407
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10,102,710 9,998,396 84,000,252
Less-
Contributions in aid of construction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 173,124 163,824 1,439,469
Accumulated depreciation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6,943,649 6,893,429 57,733,844
Carrying amount. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . \ 2,985,935 2,941,142円 24,826,938ドル
4. INVESTMENT SECURITIES
The costs and aggregate fair values of investment securities at March 31, 2015 and 2014, were as follows:
Millions of Yen
March 31, 2015 Cost Unrealized Gains Unrealized Losses Fair Value
Securities classified as:
Available-for-sale:
Equity securities. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,734円 3,924円 50円 6,608円
Debt securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 914 387 1,301
Other securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 364 71 436
Held-to-maturity. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 755 7 13 749
Millions of Yen
March 31, 2014 Cost Unrealized Gains Unrealized Losses Fair Value
Securities classified as:
Available-for-sale:
Equity securities. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,230円 3,217円 348円 6,099円
Debt securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,350 285 1 1,634
Other securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 363 34 0 398
Held-to-maturity. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,505 4 151 1,359
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Thousands of U.S. Dollars
March 31, 2015 Cost Unrealized Gains Unrealized Losses Fair Value
Securities classified as:
Available-for-sale:
Equity securities. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22,732ドル 32,634ドル 422ドル 54,944ドル
Debt securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7,602 3,221 10,824
Other securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,033 595 3,629
Held-to-maturity. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6,285 63 115 6,233
The information for available-for-sale securities which were sold during the year ended March 31, 2015, is not disclosed because realized gains and losses on
sales of available-for-sale securities for the fiscal year are immaterial.
Such information for the year ended March 31, 2014, was as follows:
Millions of Yen
March 31, 2014 Proceeds Realized Gains Realized Losses
Available-for-sale:
Equity securities. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,763円 5,386円 \ 5
Debt securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 560 138 78
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6,323円 5,524円 83円
The Company contributed certain securities with a fair value of 32,021円 million to the retirement benefit trust for the Company’s retirement benefit plans and
recognized a noncash gain of 21,711円 million for the year ended March 31, 2014.
5. PLEDGED ASSETS
All of the Company’s assets amounting to 4,390,912円 million (36,508,791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 46,982円
million (390,642ドル thousand), are pledged as collateral for a portion of their
long-term debt at March 31, 2015.
Investments in affiliated companies held by a consolidated subsidiary,
amounting to 26,216円 million (217,983ドル thousand), are pledged as collateral
for bank loans of the affiliated companies and the subsidiary of the affiliated
company at March 31, 2015.
6. LONG-TERM DEBT
Long-term debt at March 31, 2015 and 2014, consisted of the following:
Millions of Yen
Thousands of
U.S. Dollars
2015 2014 2015
Yen bonds, 0.281% to 3.65%, due serially to 2031 . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,283,630円 1,243,414円 10,672,907ドル
Loans from the Development Bank of Japan Inc., 0.52% to 3.4%,
due serially to 2030 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 322,006 291,843 2,677,366
Loans, principally from banks and insurance companies, 0.25% to 2.475%,
due serially to 2031 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Collateralized. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32,070 33,097 266,650
Unsecured . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,580,344 1,429,795 13,139,974
Obligations under finance leases . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8,911 10,890 74,094
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,226,963 3,009,040 26,830,993
Less current portion. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 382,425 204,144 3,179,723
Long-term debt, less current portion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,844,538円 2,804,896円 23,651,269ドル
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The annual maturities of long-term debt outstanding at March 31, 2015, were as follows:
Year ending March 31 Millions of Yen
Thousands of
U.S. Dollars
2016 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . \ 382,425 $ 3,179,723
2017 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 368,763 3,066,131
2018 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 401,159 3,335,488
2019 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 405,798 3,374,063
2020 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 337,454 2,805,805
Thereafter. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,331,362 11,069,780
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,226,963円 26,830,993ドル
7. SEVERANCE PAYMENTS AND PENSION PLANS
Employees terminating their employment with the Companies, either volun-
tarily 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. The Company has established
retirement benefit trusts for the Company’s defined retirement benefit plan.
Certain consolidated subsidiaries calculate liability for retirement benefits
and periodic benefit costs related to defined retirement benefit plans by the
simplified method. Under the simplified method, projected benefit obligations
are principally stated at the necessary payment amounts for voluntary retire-
ment as of the end of the fiscal year. The simplified method for accounting for
defined retirement benefit plans is allowed for a specified small-sized entity
under accounting principles generally accepted in Japan.
Defined retirement benefit plans (excluding plans applying the simplified method)
(1) The changes in defined benefit obligation for the years ended March 31, 2015 and 2014, were as follows:
Millions of Yen
Thousands of
U.S. Dollars
2015 2014 2015
Balance at beginning of year. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 435,831円 468,221円 3,623,775ドル
Cumulative effects of changes in accounting policies . . . . . . . . . . . . . . . . . . . . . . . . . . (26,869)
Restated balance. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 435,831 441,352 3,623,775
Current service cost . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13,861 14,260 115,254
Interest cost. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8,292 8,300 68,945
Actuarial losses. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49,346 1,136 410,300
Benefits paid . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (20,629) (29,452) (171,526)
Prior service cost. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,998 1,291 24,932
Others . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (1,056)
Balance at end of year. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 489,701円 435,831円 4,071,681ドル
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(2) The changes in plan assets for the years ended March 31, 2015 and 2014, were as follows:
Millions of Yen
Thousands of
U.S. Dollars
2015 2014 2015
Balance at beginning of year. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 387,930円 350,077円 3,225,492ドル
Expected return on plan assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9,767 9,194 81,213
Actuarial gains. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28,402 4,597 236,153
Contributions from the employer. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8,003 9,395 66,545
Benefits paid . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (17,261) (17,355) (143,524)
Contribution of securities to retirement benefit trust. . . . . . . . . . . . . . . . . . . . . . . . . . 32,021
Balance at end of year. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 416,841円 387,930円 3,465,881ドル
(3) Reconciliation between the liability recorded in the consolidated balance sheet and the balances of defined benefit obligation and plan assets as of March 31, 2015
and 2014
Millions of Yen
Thousands of
U.S. Dollars
2015 2014 2015
Funded defined benefit obligation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . \ 484,291 \ 430,742 $ 4,026,705
Plan assets. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (416,841) (387,930) (3,465,881)
67,450 42,812 560,823
Unfunded defined benefit obligation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,409 5,088 44,976
Net liability for defined benefit obligation. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . \ 72,859 \ 47,901 $ 605,800
Millions of Yen
Thousands of
U.S. Dollars
2015 2014 2015
Liability for retirement benefits. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . \ 87,204 47,901円 $ 725,073
Assets for retirement benefits. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (14,345) (119,273)
Net liability for defined benefit obligation. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . \ 72,859 47,901円 $ 605,800
(4) The components of net periodic benefit costs for the years ended March 31, 2015 and 2014, were as follows:
Millions of Yen
Thousands of
U.S. Dollars
2015 2014 2015
Current service cost. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . \ 13,861 14,260円 $ 115,254
Interest cost . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8,292 8,300 68,945
Expected return on plan assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (9,767) (9,194) (81,213)
Recognized actuarial gains . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (12,796) (934) (106,396)
Amortization of prior service cost . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (3,828) (2,861) (31,829)
Others . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 293 144 2,441
Net periodic benefit costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . \ (3,944) \ 9,715 $ (32,798)
(5) Amounts recognized in other comprehensive income (before income tax effect) in respect of defined retirement benefit plans for the years ended March 31, 2015
and 2014
Millions of Yen
Thousands of
U.S. Dollars
2015 2014 2015
Prior service cost . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . \ (6,826) \(4,152) $ (56,762)
Actuarial (losses) gains . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (33,740) 2,526 (280,542)
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . \(40,567) \(1,625) $(337,304)
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(6) Amounts recognized in accumulated other comprehensive income (before income tax effect) in respect of defined retirement benefit plans as of March 31, 2015
and 2014
Millions of Yen
Thousands of
U.S. Dollars
2015 2014 2015
Unrecognized prior service cost . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . \ 8,273 15,099円 $ 68,787
Unrecognized actuarial (losses) gains . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (7,296) 26,444 (60,666)
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . \ 976 41,544円 $ 8,121
(7) Plan assets as of March 31, 2015 and 2014
a. Components of plan assets
Plan assets consisted of the followings:
2015 2014
Debt investments. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45% 45%
Equity investments. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28 26
General account of life insurance companies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17 18
Others . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10 11
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 100% 100%
b. Method of determining the expected rate of return on plan assets
The expected rate of return on plan assets is determined considering distribution of plan assets currently and in the future and the long-term rates of return which
are expected currently and in the future from the various components of the plan assets.
(8) Assumptions used for the years ended March 31, 2015 and 2014, were set forth as follows:
2015 2014
Discount rate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Mainly 1.0% Mainly 2.0%
Expected rate of return on plan assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Mainly 2.5% Mainly 2.5%
Defined retirement benefit plans applying the simplified method
(1) The changes in the net carrying amount of liabilities and assets for the years ended March 31, 2015 and 2014, were as follows:
Millions of Yen
Thousands of
U.S. Dollars
2015 2014 2015
Balance at beginning of year. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,096円 3,445円 25,747ドル
Periodic benefit costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 243 173 2,023
Benefits paid . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (255) (199) (2,128)
Contributions from the employer. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (321) (323) (2,674)
Balance at end of year. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,762円 3,096円 22,967ドル
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(2) Reconciliation between the liability and asset recorded in the consolidated balance sheet and the balances of defined benefit obligation and plan assets as of
March 31, 2015 and 2014, were as follows:
Millions of Yen
Thousands of
U.S. Dollars
2015 2014 2015
Funded defined benefit obligation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . \ 5,401 \ 4,680 $ 44,913
Plan assets. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (4,860) (4,414) (40,410)
541 266 4,503
Unfunded defined benefit obligation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,220 2,830 18,464
Net carrying amount of liabilities and assets. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,762 3,096 22,967
Liabilities for retirement benefits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,343 3,336 27,796
Assets for retirement benefits. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (580) (239) (4,829)
Net carrying amount of liabilities and assets. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . \ 2,762 \ 3,096 $ 22,967
(3) Periodic benefit costs
Millions of Yen
Thousands of
U.S. Dollars
2015 2014 2015
Periodic benefit costs calculated under the simplified method . . . . . . . . . . . . . . . . . . . 243円 173円 2,023ドル
Defined contribution plans
The required contribution to defined contribution plans by the Company and its certain consolidated subsidiaries for the years ended March 31, 2015 and 2014 was
1,767円 million (14,692ドル thousand) and 1,377円 million, respectively.
8. RESERVE FOR REPROCESSING OF IRRADIATED NUCLEAR FUEL
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 consists of three portions and each of them is calculated in
different ways.
(a) The costs reprocessed in Japan Nuclear Fuel Limited ("JNFL") are cal-
culated based on the expected future cash flows discounted at 1.5% at
March 31, 2015 and 2014,
(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,
2015 was 37,907円 million (315,184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 calcula-
tions 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, 2015 is 86,974円 million (723,158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 from 2005. The reserve funds are provided to ensure the appropriate
reprocessing of irradiated nuclear fuel and presented as "Reserve funds for
reprocessing of irradiated nuclear fuel."
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9. ASSET RETIREMENT OBLIGATIONS
The changes in asset retirement obligations for the years ended March 31, 2015 and 2014, were as follows:
Millions of Yen
Thousands of
U.S. Dollars
2015 2014 2015
Balance at beginning of year. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 203,010円 221,025円 1,687,956ドル
Net change in the year. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,449 (18,015) 36,991
Balance at end of the year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 207,459 203,010 1,724,948
Less current portion. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22 21 185
Asset retirement obligations, less current portion. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 207,437円 202,989円 1,724,763ドル
10. SHORT-TERM BORROWINGS
Short-term borrowings were generally represented by bank loans, bearing interest at rates ranging from 0.23% to 1.88% and from 0.26% to 1.88% for the years
ended March 31, 2015 and 2014, respectively.
11. INCOME TAXES
The Companies are subject to national and local income taxes. The aggregate normal statutory tax rates for the Company approximated 30.7% and 33.2% for the
years ended March 31, 2015 and 2014 respectively.
The tax effects of significant temporary differences and tax loss carryforwards which resulted in deferred tax assets and liabilities at March 31, 2015 and 2014,
were as follows:
Millions of Yen
Thousands of
U.S. Dollars
2015 2014 2015
Deferred Tax Assets:
Tax loss carryforwards . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . \ 201,720 \ 189,067 $ 1,677,234
Liability for retirement benefits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34,914 39,320 290,298
Depreciation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32,856 33,109 273,193
Asset retirement obligations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19,637 20,782 163,280
Reserve for reprocessing of irradiated nuclear fuel. . . . . . . . . . . . . . . . . . . . . . . . . . . 21,373 22,243 177,710
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 68,921 51,689 573,056
Less valuation allowance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (199,682) (163,834) (1,660,286)
Deferred tax assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . \ 179,741 \ 192,378 $ 1,494,486
Deferred Tax Liabilities:
Gain on contributions of securities to retirement benefit trust . . . . . . . . . . . . . . . . . . 5,529 5,914 45,973
Assets for retirement benefits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,000 87 24,950
Amortization in foreign subsidiary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,606 1,007 13,358
Unrealized gain on available-for-sale securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,487 1,108 12,370
Capitalized assets retirement costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,346 1,330 11,193
Deferred gain on derivatives under hedge accounting . . . . . . . . . . . . . . . . . . . . . . . . 1,032 1,915 8,582
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,191 1,772 43,162
Deferred tax liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . \ 19,194 \ 13,137 $ 159,592
Net deferred tax assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . \ 160,547 \ 179,240 $ 1,334,893
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A reconciliation between the normal effective statutory tax rate and the actual effective tax rate reflected in the accompanying consolidated statements of opera-
tions for the years ended March 31, 2015 and 2014, was as follows:
2015 2014
Normal effective statutory tax rate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30.7% 33.2%
Valuation allowance. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (68.6) (48.6)
Effect of reduction of income tax rate on deferred tax assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (14.7) (4.1)
Elimination of unrealized gains. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (3.2) (0.8)
Difference of tax rates on special income tax for reconstruction funding. . . . . . . . . . . . . . . . . . . . . . . . . . . . . (4.7)
Other - net. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.5 (3.2)
Actual effective tax rate. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (55.3)% (28.2)%
New tax reform laws enacted in 2015 in Japan changed the normal
effective statutory tax rate for the fiscal year beginning on or after April 1,
2015, from approximately 30.7% to 28.7%. The effect of these changes was
to decrease deferred tax assets, net of deferred tax liabilities, in the consoli-
dated balance sheet as of March 31, 2015, by 10,431円 million (86,732ドル
thousand), increase income taxes—deferred in the consolidated statement of
operations for the year then ended by 10,687円 million (88,862ドル thousand),
and increase other comprehensive income in the consolidated statement
of comprehensive income by 263円 million (2,188ドル thousand). Decrease of
deferred tax liabilities in the consolidated balance sheet was immaterial.
At March 31, 2015, the Company and certain subsidiaries have tax loss
carryforwards aggregating 701,739円 million (5,834,698ドル thousand), most of
which are available to be offset against taxable income of the Company and
these subsidiaries and will expire in 9 years. At March 31, 2015, the tax loss
carryforwards for the Company amounting to 87,858円 million (730,513ドル thou-
sand), 114,354円 million (950,814ドル thousand), 310,635円 million (2,582,963ドル
thousand), and 175,583円 million (1,459,907ドル thousand) will expire in the
years ending March 31, 2024, 2023, 2022, and 2021, respectively.
12. EQUITY
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
(noncash assets) to shareholders subject to a certain limitation and addi-
tional requirements.
Semiannual interim dividends may also be paid once a year upon resolu-
tion by the Board of Directors if the articles of incorporation of the Company so
stipulate. The Companies Act provides certain limitations on the amounts avail-
able 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 sepa-
rate 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.
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Issuance of Preferred Stock
The Company issued 1,000 shares of Class A Preferred Stock for 100,000円
million (831,462ドル thousand) by way of third-party allotment to the Develop-
ment Bank of Japan Inc.
(1) Way of offering
Third-party allotment to the Development Bank of Japan Inc.
(2) Class and number of new shares to be issued
1,000 shares of Class A Preferred Stock
(3) Issue price
100円 million (831ドル thousand) per share
(4) Total amount of the issue price
100,000円 million (831,462ドル thousand)
(5) Amount of preferred stock and additional paid-in capital to be increased
Amount of preferred stock to be increased: 50,000円 million
(415,731ドル thousand)
(50円 million per share (415ドル thousand))
Amount of additional paid-in capital to be increased: 50,000円 million
(415,731ドル thousand)
(50円 million per share (415ドル thousand))
(6) Issue date
August 1, 2014
(7) Uses of proceeds
The proceeds from issuance of the Preferred Stock are planned to be used
entirely for construction to enhance the safety of the Company’s nuclear
power plants to meet new regulations for safety of nuclear power plants.
(8) Characteristics of the Preferred Stock
The Preferred Stock provides no provision for acquisition or right to
request acquisition using the common stock as consideration that will not
dilute common stock. These stocks also do not provide any voting rights at
the general shareholders meeting.
The Preferred Stock has a provision for acquisition allowing the
Company to acquire this Preferred Stock in exchange for cash the day
after the payment date or thereafter. Furthermore, the Preferred Stock will
provide the Preferred Shareholders with the right to request acquisition of
this Preferred Stock in exchange for cash of the Company the day after the
payment date or thereafter if the Preferred Shareholders follow the pre-
scribed procedures, but the exercise of this right by the Preferred Share-
holders is limited by the agreement to underwriting of the Preferred Stock.
Annual preferred dividend for the Preferred Stock is 3,500円 thousand
(29ドル thousand) per share.
Reduction of Preferred Stock and Additional Paid-in Capital
In preparation for future flexible capital management strategies, the Company
reduced capital stock and additional paid-in capital and transferred them to
other capital surplus, which constitutes the amount available for distribution
to the shareholders, upon issuance of Class A preferred stock mentioned in
"Issuance of Preferred Stock" above on condition that the issue came into
effect on August 1, 2014.
(1) Reduced capital stock
50,000円 million (415,731ドル thousand)
As the issuance of Preferred Stock increased the Company’s preferred
stock by 50,000円 million (415,731ドル thousand), the total amounts of
common stock and preferred stock after the effective date of the reduction
didn’t fall below the amounts before the effective date.
(2) Reduced additional paid-in capital
50,000円 million (415,731ドル thousand)
As the issuance of Preferred Stock increased the Company’s additional
paid-in capital by 50,000円 million (415,731ドル thousand), the additional
paid-in capital after the effective date of the reduction didn’t fall below the
amounts before the effective date.
(3) Method of reducing capital stock and additional paid-in capital
In accordance with the Companies Act, the Company reduced capital stock
and additional paid-in capital and transferred them to other capital surplus.
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13. RESEARCH AND DEVELOPMENT COSTS
Research and development costs charged to income were 7,343円 million (61,061ドル thousand) and 6,423円 million for the years ended March 31, 2015 and 2014, respectively.
14. RELATED PARTY DISCLOSURES
Significant transactions of the Company with an affiliated company for the years ended March 31, 2015 and 2014 were as follows:
Millions of Yen
Thousands of
U.S. Dollars
2015 2014 2015
KYUDENKO CORPORATION
Transactions:
Purchase of construction works on distribution facilities and other . . . . . . . . . . . . 36,073円 32,593円 299,938ドル
Balances at year end:
Payables for construction works. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,618 3,807 38,404
15. FINANCIAL INSTRUMENTS AND RELATED DISCLOSURES
Items Pertaining to Financial Instruments
(a) The Companies’ policy for financial instruments
The Companies use 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 nonconsolidated 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 securi-
ties and investments in and advances to nonconsolidated 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 nonconsolidated 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 are 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 reducing 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. Although a part of loans is 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 is
exposed to the market risk of fluctuations in foreign exchange, such risk is
mitigated by using foreign exchange forward contracts and currency swaps.
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. Please see
Note 16 for more details 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.
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Fair values of financial instruments
The carrying amounts and aggregate fair values of financial instruments at March 31, 2015 and 2014 were as follows:
Millions of Yen
March 31, 2015 Carrying Amount Fair Value Unrecognized Loss
Investment securities:
Held-to-maturity debt securities. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . \ 755 \ 749 \ (6)
Available-for-sale securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8,346 8,346
Investments in and advances to nonconsolidated subsidiaries and affiliated companies . . . 17,295 21,123 3,828
Reserve funds for reprocessing of irradiated nuclear fuel . . . . . . . . . . . . . . . . . . . . . . . . . 282,071 282,071
Cash and cash equivalents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 516,480 516,480
Receivables . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 199,707 199,707
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,024,657円 1,028,479円 \ 3,821
Long-term debt:
Bonds. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,283,630円 1,323,644円 40,014円
Loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,934,421 1,984,555 50,133
Short-term borrowings. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 119,901 119,901
Notes and accounts payable. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 160,392 160,392
Accrued income taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,453 4,453
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,502,799円 3,592,947円 90,148円
Derivatives . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . \ 3,596 \ 3,596
Millions of Yen
March 31, 2014 Carrying Amount Fair Value Unrecognized Loss
Investment securities:
Held-to-maturity debt securities. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . \ 1,505 \ 1,359 \ 146
Available-for-sale securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8,132 8,132
Investments in and advances to nonconsolidated subsidiaries and affiliated companies . . . 15,382 13,298 2,083
Reserve funds for reprocessing of irradiated nuclear fuel . . . . . . . . . . . . . . . . . . . . . . . . . 261,058 261,058
Cash and cash equivalents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 384,769 384,769
Receivables . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 183,568 183,568
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . \ 854,417 \ 852,187 2,230円
Long-term debt:
Bonds. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,243,414円 1,283,048円 39,634円
Loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,754,736 1,799,739 45,003
Short-term borrowings. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 118,521 118,521
Notes and accounts payable. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 167,725 167,725
Accrued income taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,448 3,448
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,287,845円 3,372,483円 84,637円
Derivatives . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . \ 6,239 \ 6,239
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Thousands of U.S. Dollars
March 31, 2015 Carrying Amount Fair Value Unrecognized Loss
Investment securities:
Held-to-maturity debt securities. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 6,285 $ 6,233 $ (51)
Available-for-sale securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 69,398 69,398
Investments in and advances to nonconsolidated subsidiaries and affiliated companies . . . 143,807 175,636 31,828
Reserve funds for reprocessing of irradiated nuclear fuel . . . . . . . . . . . . . . . . . . . . . . . . . 2,345,316 2,345,316
Cash and cash equivalents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,294,338 4,294,338
Receivables . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,660,494 1,660,494
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 8,519,641 $ 8,551,418 $ 31,776
Long-term debt:
Bonds. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10,672,907ドル 11,005,611ドル 332,703ドル
Loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16,083,991 16,500,834 416,843
Short-term borrowings. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 996,933 996,933
Notes and accounts payable. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,333,601 1,333,601
Accrued income taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37,028 37,028
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29,124,462ドル 29,874,009ドル 749,547ドル
Derivatives . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 29,905 $ 29,905
The securities whose fair value cannot be reliably determined are
excluded from investment securities and investments in and advances to
nonconsolidated subsidiaries and affiliated companies (see (b) below).
Advances are excluded from investments in and advances to nonconsoli-
dated subsidiaries and affiliated companies because they are immaterial.
Long-term debt contains its current portion, 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 nonconsolidated
subsidiaries and affiliated companies
The fair values of investment securities and investments in and advances to
nonconsolidated subsidiaries and affiliated companies are measured at the
quoted market price of the exchanges for the equity securities and some of
debt securities, principally at the quoted price obtained from the financial
institution for other debt securities. Fair value information for 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 are provided in accor-
dance 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 Japa-
nese Government. The fair value is based on the carrying amount determined
by discounting the cash flows related to the using plan.
Cash and cash equivalent, and receivables
The carrying amounts of cash and cash equivalents, and receivables approxi-
mate fair values because of their short maturities.
Bonds
The fair values of bonds are based on market price.
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
is subjected to interest rate swaps, which qualify for hedge accounting and
meet specific matching criteria (see Note 16), and the fair values are deter-
mined by discounting the cash flows related to the loans with the interest rate
swaps at the Company’s assumed corporate borrowing rate.
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Short-term borrowings, notes and accounts payable, and accrued income taxes
The carrying amounts of short-term borrowings, notes and accounts
payable and accrued income taxes approximate fair values because of their
short maturities.
Derivatives
Fair value information for derivatives is included in Note 16.
(b) Financial instruments whose fair value cannot be reliably determined
Millions of Yen
Thousands of
U.S. Dollars
2015 2014 2015
Investment securities:
Available-for-sale:
Equity securities. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . \ 73,739 \ 73,260 $ 613,115
Other securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,336 2,375 19,425
Investments in and advances to nonconsolidated subsidiaries and
affiliated companies:
Equity securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 71,186 72,372 591,888
Other securities. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10,868 9,424 90,368
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 158,130円 157,433円 1,314,797ドル
Maturity analysis for financial assets and securities with contractual maturities
Millions of Yen
March 31, 2015
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. . . . . . . . . . . . . . . . . . . . . . . . . . . . 300円 20円 \ 436
Available-for-sale securities with contractual maturities . . . . . . . . \ 39 6 1,301
Reserve funds for reprocessing of irradiated nuclear fuel . . . . . . . . 28,501
Cash and cash equivalents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 516,480
Receivables . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 199,707
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 744,729円 300円 26円 1,737円
Thousands of U.S. Dollars
March 31, 2015
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. . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,494ドル 166ドル $ 3,625
Available-for-sale securities with contractual maturities . . . . . . . . $ 332 50 10,824
Reserve funds for reprocessing of irradiated nuclear fuel . . . . . . . . 236,978
Cash and cash equivalents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,294,338
Receivables . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,660,494
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6,192,144ドル 2,494ドル 216ドル 14,449ドル
Reserve funds for reprocessing of irradiated nuclear fuel are provided for reprocessing costs of irradiated nuclear fuel charged by JNFL. The using plan for the
reserve funds is disclosed only for amounts due in one year or less, to comply with agreements with JNFL and to avoid any disadvantages, possibly caused by
disclosure, to the interested parties.
Please see Note 6 for annual maturities of long-term debt.
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16. DERIVATIVES
The Company enters into foreign exchange forward contracts, 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 accord-
ing 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 the administrative section monitors them based on internal policies.
Derivative transactions to which hedge accounting is applied
Millions of Yen
March 31, 2015 Hedged Item Contract Amount
Contract Amount
due after One Year Fair Value
Currency swaps:
Buying USD (Note a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Accounts
payable 6,197円 1,317円 3,596円
Interest rate swaps:
(fixed-rate payment; floating-rate receipt) (Note b) . . . . . . . . . . . . . .
Long-term
loans 3,092円 2,198円
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,596円
Millions of Yen
March 31, 2014 Hedged Item Contract Amount
Contract Amount
due after One Year Fair Value
Currency swaps:
Buying USD (Note a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Accounts
payable 67,869円 6,197円 5,800円
Energy swap agreements:
(fixed-price payment; floating-price receipt) (Note a). . . . . . . . . . . . .
Accounts
payable \ 1,430 438円
Interest rate swaps:
(fixed-rate payment; floating-rate receipt) (Note b) . . . . . . . . . . . . . .
Long-term
loans \ 3,970 2,698円
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6,239円
Thousands of U.S. Dollars
March 31, 2015 Hedged Item Contract Amount
Contract Amount
due after One Year Fair Value
Currency swaps:
Buying USD (Note a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Accounts
payable 51,526ドル 10,950ドル 29,905ドル
Interest rate swaps:
(fixed-rate payment; floating-rate receipt) (Note b) . . . . . . . . . . . . . .
Long-term
loans 25,708ドル 18,275ドル
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29,905ドル
Notes:
a) The fair value of derivative transactions is measured at the quoted price obtained from the financial institution.
b) 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 is recognized and included in interest charges. As a result, the fair values of interest rate swaps are included in those of hedged items (i.e., long-term loans) 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.
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17. COMMITMENTS AND CONTINGENCIES
At March 31, 2015, 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 at March 31, 2015 were as follows:
Millions of Yen
Thousands of
U.S. Dollars
Co-guarantees of loans, mainly in connection with procurement of fuel. . . . . . . . . . . . . . . . . . . . . . . . . . . . 103,111円 857,332ドル
Guarantees of employees’ loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 72,549 603,223
Guarantees under debt assumption agreements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 70,000 582,023
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7,602 63,215
Under the debt assumption agreements, the Company was contingently liable for the redemption of the domestic bonds transferred to banks.
18. COMPREHENSIVE INCOME
The components of other comprehensive loss for the years ended March 31, 2015 and 2014, were as follows:
Millions of Yen
Thousands of
U.S. Dollars
2015 2014 2015
Other comprehensive income (loss):
Unrealized gain on available-for-sale securities
Gains arising during the year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . \ 1,579 \ 2,758 $ 13,136
Reclassification adjustments to profit or loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 197 (26,843) 1,640
Amount before income tax effect. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,777 (24,084) 14,777
Income tax effect . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (589) 7,414 (4,898)
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . \ 1,188 \(16,670) $ 9,878
Deferred (losses) gain on derivatives under hedge accounting:
(Losses) gains arising during the year. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . \ (2,142) \ 1,233 $ (17,811)
Adjustments for amounts transferred to the initial carrying amounts of hedged items. . . (500) (720) (4,157)
Amount before income tax effect. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (2,642) 512 (21,969)
Income tax effect . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 883 (48) 7,342
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . \ (1,759) \ 464 $ (14,626)
Foreign currency translation adjustments:
Gains (losses) arising during the year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . \ 1,235 \ (1,429) $ 10,272
Amount before income tax effect. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,235 (1,429) 10,272
Income tax effect . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (1,260) (10,482)
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . \ (25) \ (1,429) $ (209)
Adjustments related to defined retirement benefit plans:
(Losses) gains arising during the year. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . \(23,793) \ 3,461 $(197,832)
Reclassification adjustments to profit or loss. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (16,774) (5,086) (139,472)
Amount before income tax effect. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (40,567) (1,625) (337,304)
Income tax effect . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12,375 941 102,893
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . \(28,192) \ (683) $(234,411)
Share of other comprehensive (loss) income in nonconsolidated subsidiaries and
affiliated companies:
(Losses) gains arising during the year. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . \ (1,349) \ 2,699 $ (11,223)
Reclassification adjustments to profit or loss. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 178 116 1,482
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . \ (1,171) \ 2,816 $(9,741)
Total other comprehensive loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . \(29,960) \(15,503) $(249,109)
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19. SEGMENT INFORMATION
(1) Description of reportable segments
The Companies’ reportable segments are those for which financial informa-
tion is available separately and regular evaluation by the Company’s manage-
ment 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, information technology (IT) and
telecommunications and other.
The energy related business consists of obtaining, storing, gasifying,
supplying and selling LNG, renewable energy business 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.
(2) 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."
Accounting change in case the Company decides to decommission
nuclear power units due to factors such as a change of the govern-
ment’s energy policy
As described in Note 2.g, the Company applied the revised accounting regu-
lation applicable to electric utility providers relating to accounting treatments
in case the Company decides to decommission nuclear power units due to
factors such as a change of the government’s energy policy, on and after
March 13, 2015. Accordingly, the Company has applied the same accounting
policy to the "Electric Power" segment.
The effect of this change on segment loss of Electric Power was immaterial.
(3) Information about sales, profit, assets and other items at March 31, 2015 and 2014, was as follows:
Millions of Yen2015Reportable segment
Reconciliations Consolidated
Electric Power
Energy related
Business
IT and
Telecommuni-
cations Other Total
Sales:
Sales to external customers. . . . 1,719,570円 \ 71,793 \ 69,217 \ 12,886 1,873,467円 1,873,467円
Intersegment sales or transfers. . 2,298 114,878 27,333 12,846 157,356 \(157,356)
Total . . . . . . . . . . . . . . . . . . . . 1,721,869円 186,672円 \ 96,550 \ 25,732 2,030,824円 \(157,356) 1,873,467円
Segment (loss) profit . . . . . . . . . . . \ (68,481) \ 10,983 \ 11,419 \ 3,677 \ (42,400) \ (914) \ (43,314)
Segment assets . . . . . . . . . . . . . . . 4,235,616 375,418 176,152 141,491 4,928,679 (143,943) 4,784,735
Other:
Depreciation . . . . . . . . . . . . . . . . 164,724 9,052 18,028 4,947 196,753 (2,780) 193,972
Increase in property and
nuclear fuel. . . . . . . . . . . . . . . . . 228,362 22,756 25,550 948 277,617 (4,737) 272,880
Millions of Yen2014Reportable segment
Reconciliations Consolidated
Electric Power
Energy related
Business
IT and
Telecommuni-
cations Other Total
Sales:
Sales to external customers. . . . 1,633,023円 \ 78,150 \ 65,841 \ 14,137 1,791,152円 1,791,152円
Intersegment sales or transfers. . 1,805 92,856 23,907 13,004 131,573 \(131,573)
Total . . . . . . . . . . . . . . . . . . . . 1,634,829円 171,007円 \ 89,748 \ 27,142 1,922,726円 \(131,573) 1,791,152円
Segment (loss) profit . . . . . . . . . . . \ (121,615) \ 10,367 \ 11,342 \ 3,266 \ (96,639) \ 818 \ (95,821)
Segment assets . . . . . . . . . . . . . . . 4,057,306 345,698 136,493 136,780 4,676,279 (126,427) 4,549,852
Other:
Depreciation . . . . . . . . . . . . . . . . 172,341 9,210 18,432 5,550 205,534 (2,678) 202,856
Increase in property and
nuclear fuel. . . . . . . . . . . . . . . . . 216,181 23,927 19,808 1,438 261,355 (4,351) 257,004
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Thousands of U.S. Dollars2015Reportable segment
Reconciliations Consolidated
Electric Power
Energy related
Business
IT and
Telecommuni-
cations Other Total
Sales:
Sales to external customers . . . . 14,297,586ドル $ 596,939 $ 575,515 $ 107,142 15,577,184ドル 15,577,184ドル
Intersegment sales or transfers. . 19,110 955,170 227,266 106,811 1,308,359 $(1,308,359)
Total . . . . . . . . . . . . . . . . . . . . 14,316,697ドル 1,552,109ドル $ 802,782 $ 213,954 16,885,543ドル $(1,308,359) 15,577,184ドル
Segment (loss) profit . . . . . . . . . . . $ (569,397) $ 91,326 $ 94,952 $ 30,575 $ (352,543) $ (7,601) $ (360,144)
Segment assets . . . . . . . . . . . . . . . 35,217,563 3,121,462 1,464,642 1,176,451 40,980,120 (1,196,838) 39,783,282
Other:
Depreciation . . . . . . . . . . . . . . . . 1,369,623 75,268 149,899 41,135 1,635,928 (23,117) 1,612,811
Increase in property and
nuclear fuel. . . . . . . . . . . . . . . . . 1,898,749 189,214 212,441 7,882 2,308,288 (39,389) 2,268,899
Notes:
(a) Reconciliations of segment (loss) profit and segment assets are intersegment transaction eliminations.
(b) Segment (loss) profit is adjusted to reflect operating loss in the consolidated statement of operations.
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.
20. BUSINESS COMBINATIONS
a. Conversion of Kyushu Telecommunication Network Co., Ltd. (consoli-
dated subsidiary of the Company), to a wholly owned subsidiary through
share exchange
1. Overview of the transaction
(1) Name and business of parties to the business combination
Combining company (wholly owning parent company in the share
exchange)
Name: Kyushu Electric Power Company, Incorporated ("the Company")
Business: Electricity business and others
Combined company (wholly owned subsidiary company in the share
exchange)
Name: Kyushu Telecommunication Network Co., Ltd. ("QTNet")
Business: telecommunications business and others
(2) Date of the business combination
November 14, 2014
(3) Legal form of the business combination
A share exchange (the "Share Exchange") in which the Company is the
wholly owning parent company and QTNet is the wholly owned subsid-
iary company
(4) Company Name following the business combination
No change
(5) Other items related to the overview of the transaction
The Company reached the decision to convert QTNet into a wholly
owned subsidiary of the Company through the Share Exchange, thereby
creating a structure that would facilitate rapid and flexible Group
management in the IT and telecommunications business.
2. Overview of accounting process conducted
The Share Exchange was conducted as a transaction under common
control in accordance with the Accounting Standard for Business Combina-
tions (ASBJ Statement No. 21, as announced on December 26, 2008)
and Guidance on Accounting Standard for Business Combinations and
Accounting Standard for Business Divestitures (ASBJ Guidance No. 10, as
announced on December 26, 2008).
3. Acquisitions of additional shares in subsidiaries
(1) Acquisition cost and its breakdown
Consideration for acquisition
(common shares of the Company) 663円 million 5,514ドル thousand
Direct cost for the acquisition \ 0 million $ 2 thousand
Acquisition cost 663円 million 5,517ドル thousand
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(2) Exchange ratio by class of shares, calculation method and number of shares delivered
i. Class of shares, exchange ratio and number of shares delivered
Class of shares
Common shares of the Company
(wholly owning parent company in the Share
Exchange)
Common shares of QTNet
(wholly owned subsidiary company in the Share
Exchange)
Share exchange ratio 1 53
Number of shares delivered in
the Share Exchange
Common shares of the Company: 514,100
Notes:
1. Share exchange ratio
53 common shares of the Company delivered for each 1 common share of QTNet
2. Number of shares delivered in the Share Exchange
Common shares of the Company delivered by the Company were provided from treasury stock, and no new shares were issued.
ii. Calculation method of share exchange ratio
To ensure fairness in calculating the share exchange ratio used in
the Share Exchange, each of the two companies asked a separate
third-party calculating institution to calculate a share exchange ratio.
As its third-party calculating institution, the Company selected the
Yakabe Certified Public Accounting Office, and QTNet selected the
Megumi Tanaka Certified Public Accounting Office.
As the common shares of the Company are listed on the Tokyo
Stock Exchange, the Yakabe Certified Public Accounting Office
adopted the market stock price method for the Company’s shares.
For QTNet, which is unlisted, the office adopted the net asset value
method, the similar company comparison method and the discounted
cash flow method (the "DCF method") to calculate a share exchange
ratio for the Share Exchange.
Meanwhile, the Megumi Tanaka Certified Public Accounting Office
adopted the market stock price method for the Company, as its
common shares are listed on the Tokyo Stock Exchange. For QTNet,
as an unlisted company, the office employed the net asset value
method and the DCF method to calculate the share exchange ratio
for the Share Exchange.
Referring to the calculation results submitted by the third-party
calculation institutions, the Company and QTNet decided on the
above-mentioned share exchange ratio for the Share Exchange
based on deliberative consultation between the two companies.
(3) Amount and cause of bargain purchase gain
i. Amount of bargain purchase gain : 66円 million (553ドル thousand)
ii. Cause
Because the consideration for acquisition of additional shares in the
subsidiary was below the amount of reduction in the value of the
Company’s minority interests.
b. Transfer of the optical fiber core cable leasing business to Kyushu
Telecommunication Network Co., Ltd.
1. Overview of the transaction
(1) Name and content of the target business
Name of business: The Company’s optical fiber core cable leasing
business and related optical fiber facilities
Business content: The laying of optical fiber cable and leasing of optical
fiber core to telecommunications carriers, including QTNet.
Transferred asset and liability items and their amounts:
Among transferred plant and equipment of 49,143円 million (408,610ドル
thousand), 32,618円 million (271,210ドル thousand) was transferred
through a company split, and 16,525円 million (137,400ドル thousand)
was transferred through the sale of assets. No current assets or
liabilities were transferred.
(2) Date of the business combination
March 1, 2015
(3) Legal form of the business combination
The transfer was made to QTNet through a company split(*). However,
the optical fiber facilities used by QTNet were sold to QTNet under a
separate contract regarding the sale for assets by the book value.
(*) This was an absorption-type company split (the "Absorption-Type
Company Split") in which the Company was the splitting company
and QTNet was the succeeding company. In line with the Absorption-
Type Company Split, as a consideration for the assets, QTNet issued
9,600 common shares, all of which were allocated to the Company.
As the Absorption-Type Company Split was an absorption-type com-
pany split between the Company and QTNet, which is wholly owned,
the content of the allocation was determined through discussion
between the two companies.
(4) Company Name following the merger
No change.
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(5) Other items related to an overview of the transaction
It is expected that transferring the Company’s optical fiber core cable
leasing service and related optical fiber facilities to QTNet on this basis
will encourage more efficient operational management throughout the
Group by concentrating management resources, while at the same time
enhancing QTNet’s self-directive operational structure.
2. Overview of accounting process conducted
The Absorption-Type Company Split was conducted as a transaction under
common control in accordance with the Accounting Standard for Business
Combinations (ASBJ Statement No. 21, as announced on December 26,
2008) and Guidance on Accounting Standard for Business Combinations
and Accounting Standard for Business Divestitures (ASBJ Guidance No. 10,
as announced on December 26, 2008).
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Kyushu Electric Power Company Annual Report 2015
Nonconsolidated Five-year Financial Summary
Kyushu Electric Power Company, Incorporated
Years Ended March 31
Millions of Yen
Thousands of
U.S. Dollars
For the Year: 2011 2012 2013 2014 2015 2015
Operating revenues. . . . . . . . . . . . 1,387,517円 1,406,770円 1,448,876円 1,682,994円 1,761,275円 14,644,342ドル
Electric . . . . . . . . . . . . . . . . . . . . . . 1,356,317 1,369,537 1,408,339 1,634,829 1,721,869 14,316,697
Other . . . . . . . . . . . . . . . . . . . . . . . 31,199 37,232 40,536 48,165 39,405 327,644
Operating expenses. . . . . . . . . . . . . 1,269,718 1,569,533 1,721,006 1,756,444 1,790,350 14,886,094
Personnel. . . . . . . . . . . . . . . . . . . . 162,650 167,965 151,844 113,781 113,103 940,414
Fuel . . . . . . . . . . . . . . . . . . . . . . . . 284,857 520,282 679,722 754,442 678,486 5,641,356
Purchased power . . . . . . . . . . . . . 137,063 206,042 269,582 314,961 372,437 3,096,678
Depreciation . . . . . . . . . . . . . . . . . 197,977 202,151 180,180 172,333 164,721 1,369,594
Maintenance . . . . . . . . . . . . . . . . . 175,986 176,007 147,924 103,155 126,641 1,052,980
Reprocessing costs of irradiated
nuclear fuel. . . . . . . . . . . . . . . . . . 30,795 21,631 17,352 16,502 17,111 142,276
Decommissioning costs of nuclear
power units. . . . . . . . . . . . . . . . . . 7,524 3,106 2,627 1,978 4,293 35,700
Disposal cost of high-level
radioactive waste. . . . . . . . . . . . . 8,885 6,010 3,247 3,861
Disposition of property . . . . . . . . . 15,181 15,334 14,501 10,600 11,491 95,549
Taxes other than income taxes . . 87,680 83,142 82,265 84,339 84,397 701,732
Subcontract fee. . . . . . . . . . . . . . . 67,728 65,948 64,485 62,182 74,332 618,050
Rent . . . . . . . . . . . . . . . . . . . . . . . . 32,789 31,276 29,298 26,920 25,741 214,028
Other . . . . . . . . . . . . . . . . . . . . . . . 60,598 70,634 77,974 91,384 117,591 977,730
Interest charges . . . . . . . . . . . . . . . . 32,150 32,266 35,581 38,009 38,693 321,719
Income (loss) before income taxes. . 35,778 (229,754) (343,051) (75,619) (84,905) (705,956)
Net income (loss) . . . . . . . . . . . . . . . 20,443 (174,983) (338,050) (90,939) (119,010) (989,528)
Per share of common stock: Yen U.S. Dollars
Basic net income (loss) . . . . . . . . . . 43円.19 \(369.74) \(714.33) \(192.17) \(251.32) $(2.08)
Cash dividends applicable to
the year . . . . . . . . . . . . . . . . . . . . . . 60.00 50.00
At year-end: Millions of Yen
Thousands of
U.S. Dollars
Total assets . . . . . . . . . . . . . . . . . . . 3,890,891円 4,110,950円 4,201,704円 4,218,037円 4,390,912円 36,508,791ドル
Net property . . . . . . . . . . . . . . . . . . . 2,811,194 2,757,023 2,704,014 2,687,936 2,664,541 22,154,668
Long-term debt,
less current portion. . . . . . . . . . . . . 1,627,260 2,090,311 2,425,739 2,692,319 2,712,193 22,550,870
Total equity. . . . . . . . . . . . . . . . . . . . 967,515 766,700 429,287 341,405 322,299 2,679,802
(U.S. dollar amounts have been translated from yen, for convenience, at the rate of 120円.27 = U.S. 1,ドル the approximate rate of exchange at March 31, 2015.)
* Figures less than a million yen are rounded down.
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Kyushu Electric Power Company Annual Report 2015
Nonconsolidated Balance Sheet
Kyushu Electric Power Company, Incorporated
March 31, 2015 (Unaudited)
Millions of Yen
Thousands of
U.S. Dollars
2015 2014 2015
ASSETS
PROPERTY:
Plant and equipment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8,927,999円 8,975,468円 74,232,974ドル
Construction in progress . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 370,033 310,704 3,076,687
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9,298,033 9,286,172 77,309,662
Less-
Contributions in aid of construction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 165,254 155,949 1,374,031
Accumulated depreciation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6,468,236 6,442,287 53,780,961
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6,633,491 6,598,236 55,154,993
Net property. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,664,541 2,687,936 22,154,668
NUCLEAR FUEL. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 280,616 281,522 2,333,217
INVESTMENTS AND OTHER ASSETS:
Investment securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 77,315 76,994 642,853
Investments in and advances to subsidiaries and affiliated companies . . . . . . . . . . 184,605 149,634 1,534,925
Reserve funds for reprocessing of irradiated nuclear fuel . . . . . . . . . . . . . . . . . . . . . 282,071 261,058 2,345,316
Deferred tax assets. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 107,187 141,299 891,225
Special account related to nuclear power decommissioning . . . . . . . . . . . . . . . . . . . 21,692 180,365
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33,294 26,986 276,831
Total investments and other assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 706,167 655,973 5,871,516
CURRENT ASSETS:
Cash and cash equivalents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 466,141 334,476 3,875,789
Receivables . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 167,633 153,366 1,393,810
Allowance for doubtful accounts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (452) (519) (3,761)
Fuel and supplies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60,005 67,306 498,925
Deferred tax assets. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30,371 29,225 252,529
Prepaid expenses and other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15,887 8,749 132,095
Total current assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 739,586 592,605 6,149,387
TOTAL . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,390,912円 4,218,037円 36,508,791ドル
(U.S. dollar amounts have been translated from yen, for convenience, at the rate of 120円.27 = U.S. 1,ドル the approximate rate of exchange at March 31, 2015.)
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Kyushu Electric Power Company Annual Report 2015
Millions of Yen
Thousands of
U.S. Dollars
2015 2014 2015
LIABILITIES AND EQUITY
LONG-TERM LIABILITIES:
Long-term debt, less current portion. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,712,193円 2,692,319円 22,550,870ドル
Liability for retirement benefits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 69,686 74,526 579,420
Reserve for reprocessing of irradiated nuclear fuel. . . . . . . . . . . . . . . . . . . . . . . . . . . 322,666 332,882 2,682,853
Asset retirement obligations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 206,113 201,142 1,713,759
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17,159 13,581 142,676
Total long-term liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,327,820 3,314,453 27,669,581
CURRENT LIABILITIES:
Current portion of long-term debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 344,632 181,395 2,865,490
Short-term borrowings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 115,000 115,000 956,181
Accounts payable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 131,926 145,495 1,096,915
Accrued expenses. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 104,490 85,061 868,799
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43,050 35,226 357,948
Total current liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 739,099 562,179 6,145,336
RESERVE FOR FLUCTUATIONS IN WATER LEVEL. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,692 14,070
EQUITY:
Common stock,
authorized, 1,000,000,000 shares; issued,
474,183,951 shares in 2015 and 2014 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 237,304 237,304 1,973,101
Preferred stock,
authorized, 1,000 shares; issued,
1,000 shares in 2015 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Capital surplus:
Additional paid-in capital. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31,087 31,087 258,482
Other capital surplus . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 99,309 19 825,719
Retained earnings:
Legal reserve . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 59,326 59,326 493,275
Retained earnings - carryforward . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (107,931) 11,078 (897,411)
Unrealized gain on available-for-sale securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,062 418 8,830
Deferred gain on derivatives under hedge accounting . . . . . . . . . . . . . . . . . . . . . . . . 2,564 4,323 21,322
Treasury stock-at cost,
192,661 shares in 2015 and 962,489 shares in 2014. . . . . . . . . . . . . . . . . . . . . . (423) (2,153) (3,517)
Total equity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 322,299 341,405 2,679,802
TOTAL . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,390,912円 4,218,037円 36,508,791ドル
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Kyushu Electric Power Company Annual Report 2015
Nonconsolidated Statement of Operations
Kyushu Electric Power Company, Incorporated
Year Ended March 31, 2015 (Unaudited)
Millions of Yen
Thousands of
U.S. Dollars
2015 2014 2015
OPERATING REVENUES:
Electric . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,721,869円 1,634,829円 14,316,697ドル
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39,405 48,165 327,644
Total operating revenues. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,761,275 1,682,994 14,644,342
OPERATING EXPENSES:
Electric:
Personnel . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 113,103 113,781 940,414
Fuel . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 678,486 754,442 5,641,356
Purchased power . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 372,437 314,961 3,096,678
Depreciation. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 164,721 172,333 1,369,594
Maintenance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 126,641 103,155 1,052,980
Reprocessing costs of irradiated nuclear fuel . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17,111 16,502 142,276
Decommissioning costs of nuclear power units . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,293 1,978 35,700
Disposal cost of high-level radioactive waste . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,861
Disposition of property. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11,491 10,600 95,549
Taxes other than income taxes. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 84,397 84,339 701,732
Subcontract fee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 74,332 62,182 618,050
Rent. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25,741 26,920 214,028
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 117,591 91,384 977,730
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,790,350 1,756,444 14,886,094
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30,304 38,787 251,974
Total operating expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,820,655 1,795,232 15,138,068
OPERATING LOSS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (59,380) (112,237) (493,726)
OTHER (INCOME) EXPENSES:
Interest charges . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38,693 38,009 321,719
Foreign exchange gains . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (1,779) (1,257) (14,795)
Gain on sales of fixed assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (9,867) (27,141) (82,045)
Gain on sales of investment securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (6,006)
Gain on sales of investments of an affiliated company . . . . . . . . . . . . . . . . . . . . . . . . (2,481)
Gain on contribution of securities to retirement benefit trust . . . . . . . . . . . . . . . . . . . (21,711)
Other-net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (3,213) (11,722) (26,719)
Total other (income) expenses-net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23,832 (32,310) 198,159
LOSS BEFORE INCOME TAXES AND (REVERSAL OF) PROVISION FOR RESERVE FOR
FLUCTUATIONS IN WATER LEVEL. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (83,213) (79,927) (691,885)
PROVISION FOR (REVERSAL OF) RESERVE FOR FLUCTUATIONS IN WATER LEVEL . . . . 1,692 (4,308) 14,070
LOSS BEFORE INCOME TAXES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (84,905) (75,619) (705,956)
INCOME TAXES:
Current. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 486 370 4,047
Deferred. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33,618 14,949 279,523
Total income taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34,105 15,320 283,571
NET LOSS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . \ (119,010) \ (90,939) $ (989,528)
Yen U.S. Dollars
PER SHARE OF COMMON STOCK:
Basic net loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . \(251.32) \(192.17) $(2.08)
Cash dividends applicable to the year. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(U.S. dollar amounts have been translated from yen, for convenience, at the rate of 120円.27= U.S. 1,ドル the approximate rate of exchange at March 31, 2015.)
85/90
Section 5
Financial Information
Section 3
Special Feature
Section 2
Management Message
Section 4
Management Base
Section 1
Kyushu Electric Power Summary
Kyushu Electric Power Company Annual Report 2015