TV Asahi Corporation

Transcription

TV Asahi at a Glance
Board of Directors
Investor Information
As of June 27, 2007
As of March 31, 2007
TV broadcasting, the mainstay segment of the TV Asahi Group, comprises operations
related to the production and transmission of television programs aired on the TV Asahi
network. These activities are undertaken primarily by TV Asahi and subsidiary TV Asahi
Productions Co., Ltd., and account for approximately 90% of consolidated net sales.
TV Asahi has earned high praise from viewers for news and information programs,
such as Hodo Station—the network’s most recognized weeknight news show—and
TV Broadcasting
Business
Takeshi’s TV Tackle, in which Takeshi Kitano, a world-renowned director, leads weekly
discussions on political, economic and social topics. TV Asahi’s entertainment shows
and drama series also capture strong ratings.
Sports programming is another important genre. TV Asahi delivers major events to
which it has exclusive broadcasting rights, such as the 2007 FINA World Championships Melbourne and the 2006 FINA Synchronised Swimming World Cup in the past
year. The Company also has an exclusive contract with the Asian Football Confederation (AFC).
In the animation genre, TV Asahi has continued to focus on programs that appeal
to overseas audiences, such as Doraemon and Crayon Shin-chan.
TV Asahi Music Co., Ltd., the core subsidiary of the Company’s music publication
Music Publication
Business
business, administers copyrights for music compositions, manages artists and scouts
for promising new talent through tie-ups with television programs.
TV Asahi Music is also the exclusive agent for a number of artists particularly well
liked by young adults. HY, KETSUMEISHI, Shonan no Kaze and Sasuke are artists
who continue to grow in popularity.
Other Businesses
TV Asahi is involved in activities such as special events production, TV shopping, video
and DVD sales, and motion picture investment, as well as content distribution on the
Internet and to mobile phones.
In the special events business, TV Asahi sponsors Summer Sonic and Fuji Rock
Festival, concerts that have become summer traditions.
In the TV shopping business, the Company has marketed an array of hit products and
continues to work with manufacturers to develop new hit products.
In video and DVD sales, a steady stream of new releases, particularly series of popular
TV dramas and entertainment shows, has contributed to sales.
In motion picture investment, TRICK The Movie 2, based on the popular drama series
TRICK, and samurai epic Love and Honor, starring popular Japanese entertainer, Takuya
Kimura, and directed by Yoji Yamada, drew large audiences.
In the Internet and mobile content distribution business, “Tele Asa com·plete!,”
a subscription-based information site for mobile phone users, continues to deliver
program-related content.
Board of Directors
Stock Information
Corporate Data
Chairman
Michisada Hirose
Authorized Number of Shares
3,000,000
Corporate Name
President
Masao Kimiwada *
Issued Number of Shares
1,006,000
Abbreviation
TV Asahi
Vice-President
Hiroshi Hayakawa *
Number of Stockholders
37,980
Executive Directors
Kenji Kazama
Ikuo Kamiyama
Hidekazu Kitamura
Hiroaki Takada
Keiji Takano
Toshio Fukuda
Number of Shares Held by Foreign
Investors
152,003 (15.11%)
Head Office
9-1 Roppongi 6-chome, Minato-ku,
Tokyo 106-8001, Japan
Tel. +81-3-6406-1111
http://www.company.tv-asahi.co.jp/e/
Members of the Board
Toru Takeda
Mutsuko Horikoshi
Takahiro Otsuka
Seishi Fukuda
Kojiro Watanabe
Michio Uematsu
Haruki Kitazawa
Kotaro Akiyama
Tsuyoshi Okada
Yoshitoshi Kitajima
Mitsuru Gondo
Yoshio Nishimura
Tetsuzo Hori
Standing Corporate Auditors
Sachio Arikura
Yasuharu Murase
Corporate Auditors
Koichi Kobayashi
Sawako Noma
Takahisa Hamamoto
* Representative Directors
Listing
Tokyo Stock Exchange
Date of Establishment
November 1, 1957
Stockholder Information
Date of Service Start
February 1, 1959
Fiscal Year-End
March 31
Paid-in Capital
¥36,642,800,000
General Meeting of Stockholders
Number of Employees
1,218
41
June
Underwriter
Transfer Agent
The Sumitomo Trust & Banking Co.,
Ltd.
Daiwa Securities SMBC Co. Ltd.
Sub-Underwriter
Nomura Securities Co., Ltd.
Nikko Citigroup Limited
Major Stockholders
Name
Shares
Percent of
voting rights
Asahi Shimbun Publishing Company
340,495
33.85
Toei Co., Ltd.
161,842
16.09
Dai Nippon Printing Co., Ltd.
40,300
4.01
Kyusyu Asahi Broadcasting Co., Ltd.
32,147
3.20
Mellon Bank Treaty Clients Omnibus
29,876
2.97
Satellite Channels Incorporated
20,854
2.07
The Master Trust Bank of Japan, Ltd.(Trust Account)
16,493
1.64
State Street Bank & Trust Company 505025
16,422
1.63
CBNY-UMB Fund
15,304
1.52
Kodansha Ltd.
13,640
1.36
Special Programming
Sales
(Millions of yen)
% of 2007 Sales
240,000
Grand Prix of Figure
Skating Final 2006
2007 FINA World
Championships Melbourne
Freezing Point
Regular Programming
180,000
120,000
87.4%
60,000
0
03
04
05
Sales
06
Hodo Station
Music Station
London Hearts
Partners
Takeshi’s TV Tackle
07
(Millions of yen)
Oh! My
Mother in Law!
% of 2007 Sales
12,000
9,000
6,000
3.6%
3,000
KETSUMEISHI
0
03
04
05
Sales
06
HY
Shonan no Kaze
07
(Millions of yen)
% of 2007 Sales
24,000
18,000
12,000
9.0%
6,000
0
Summer Sonic
Chii Sanpo
TRICK The Movie 2
©2006 TRICK The Movie 2
Production Committee
03
04
05
06
07
Consolidated Financial Highlights
TV Asahi Corporation and Consolidated Subsidiaries
Years ended March 31, 2007 and 2006
Millions of yen
For the Year:
Net sales:
TV broadcasting:
Network time
Spot
Sales of programs
Other
Music publication
Other businesses
Operating income
Net income
Capital expenditures
Depreciation and amortization
At Year-End:
Total assets
Total net assets
2007
0.7%
0.3 1.8
-1.5
0.7
2.1
-14.5 13.7 -19.9 8.8 -7.4 -2.1 $2,127,277
1,858,619
805,676
839,229
96,408
117,306
77,891
190,767
115,866
87,285
39,560
71,012
314,466
249,444
316,080
244,514
-0.5 2.0 2,663,837
2,113,037
Percentage change
¥
9,226
241,216
¥ 10,242
245,678
Percent
Key Ratios:
Equity ratio
Return on equity (ROE)
Thousands of U.S. dollars
2007/2006
¥249,384
218,813
93,384
100,563
11,303
13,563
10,759
19,812
17,076
9,467
5,042
8,560
Yen
Per Share of Common Stock:
Net income—basic
Net assets
Percentage change ¥251,125
219,410
95,110
99,071
11,381
13,848
9,195
22,520
13,678
10,304
4,670
8,383
2006
2007
78.6%
4.2 11.0%
1.8 U.S.dollars
$
87
2,081
Change
76.8%
4.0 1.8%
0.2
Notes: 1. For convenience only, U.S. dollar amounts have been translated from Japanese yen at the rate of ¥118.05 to US$1, the rate of exchange prevailing on the Tokyo
Foreign Exchange Market on March 30, 2007.
2. For total net assets, see Note 1 ( l ) of the Notes to Consolidated Financial Statements.
3. For calculations per share of common stock, see Note 8 of the Notes to Consolidated Financial Statements.
4. Return on equity (ROE) = 100 x [Net income ÷ (Average net assets—Average minority interests)].
CONTENTS
03 To Our Stakeholders
04 New Medium-Term Management Plan
07 Companywide Reform Campaign Overview
12 TV Asahi's Broadband Businesses
13 Japan's TV Industry and Terrestrial Digital Broadcasting Efforts
14 Protecting the Environment, Contributing to Society
16 Corporate Governance
17 Financial Section
39 TV Asahi Network
40 Principal Subsidiaries and Affiliates
41 Board of Directors
41 Investor Information
Forward-Looking Statements
This report contains forward-looking statements that are based
on management’s assumptions and beliefs in light of the
information currently available to it. These statements are subject
to risks and uncertainties that could cause actual results to differ
materially from those discussed in this report. Such risks include
but are not limited to market trends and economic conditions.
To Our Stakeholders
First of all, I would like to take this opportunity to offer my sincer-
est gratitude to each one of our stakeholders for your support of
Term Management Plan. Our five-year plan encompasses
the TV Asahi Group.
our consolidated group companies, clarifies our corporate
priorities and is simple in its purpose of engendering a common
Recently in the advertising industry, despite such high-profile
Fiscal 2008 is the first year of TV Asahi’s New Medium-
events as 2006 FIFA World Cup™ Germany, unstable climatic
understanding throughout our group. The celebration of TV
conditions, rises in material costs and a weak recovery in
Asahi’s 50th anniversary will take place during the period of our
consumer spending dampened business activity, resulting in
New Medium-Term Management Plan, and in fiscal 2012, the
sluggish market conditions.
last year of the Plan, the complete transition of digital terrestrial
broadcasting will take place. The next five years will bring major
Fiscal 2007, ended March 31, 2007, was the final year of
TV Asahi’s Companywide Reform Campaign. We focused on
changes in the broadcasting industry and many challenges for
strengthening our competence to maintain high viewer ratings
the TV Asahi Group. To meet these challenges, we will reinforce
and to secure stable revenue. In terms of viewer ratings, we
our content production and acquisition capabilities gained in the
captured the number one position in prime time 2 (11 p.m. to 1
Companywide Reform Campaign and strengthen our corporate
a.m.) for the second straight year. However, our all-day (6 a.m.
cornerstone that promises another 50 years of growth.
to midnight), golden time (7 p.m. to 10 p.m.) and prime time
(7 p.m. to 11 p.m.) ratings all fell short of last year’s levels.
TV Asahi, we thank you for your continued understanding and
Such outcome has defined the areas and issues we need to
support as we strive to achieve our goals.
On behalf of the Board of Directors and all the employees at
tackle going forward.
In our financial results, our efforts to gain higher profits in
June 2007
both our advertising and nonadvertising businesses in fiscal
2007 led to a ¥700 million increase in net sales to ¥251.1 billion. Operating income decreased ¥3.3 billion, to ¥13.6 billion,
and net income rose ¥800 million, to ¥10.3 billion, owing to
Masao Kimiwada
reduced tax expenses.
President
New Medium-Term Management Plan
TV Asahi’s mission is “to become the industry leader in content creation.” The Companywide
Reform Campaign conducted over the last five years was a great success. At the same time,
it helped us identify the future challenges we need to face for continued development. In our
New Medium-Term Management Plan, which duration is for five years beginning April 2007, our
business priority is to further strengthen our content creation capability as we strive to reach the
next stage of our growth.
Goals of the New Medium-Term Management Plan
1. Achieve the number one position in prime time ratings in fiscal 2012
2. Achieve consolidated net sales of ¥300 billion and operating income of
¥20 billion in fiscal 2012
3. Build a corporate culture that maximizes the creativity of all employees
Consolidated Net Sales and Operating Income Targets
(Billions of yen)
FY 2007
results
FY 2010
goals
FY 2012
goals
Percentage
growth
Percentage growth
(annual average)
¥251.1
¥282.0
¥300.0
19.5%
3.6%
Operating income
13.7
12.5
20.0
46.2%
7.9%
Operating profit margin
5.4%
4.4%
6.7%
—
—
Net sales
New Medium-Term Management Plan and
TV Asahi’s 50th Anniversary Celebration
The 50th anniversary of TV Asahi’s establishment is on November 1, 2007, and the
50th anniversary of the launch of TV Asahi’s broadcasting service is on February
1, 2009—both during the course of the New Medium-Term Management Plan. We
are therefore designating the period of one year and five months from November 1,
2007 to March 31, 2009, as TV Asahi’s 50th Anniversary Celebration period. Our
50th Anniversary Celebration will play a central role in strengthening our content
production capabilities. In addition to producing large-scale special programs, we
will actively sponsor major events in order to reinforce our production structure.
FY2008
FY2009
FY2010
FY2011
FY2012
New Medium-Term Management Plan
FY2008 — FY2012
50th Anniversary Celebration
Nov. 1, 2007 — Mar. 31, 2009
Strategies for New Medium-Term Management Plan
Boosting Content Production Capabilities
Through the Companywide Reform Campaign, TV Asahi has steadily increased viewer ratings to
contend for the number two position in prime time. In the next five years, our top priority is to reinforce
our ability to produce strong content. Our aim is to firmly establish ourselves as number two in prime
time ratings in fiscal 2010, and to take the number one position in fiscal 2012. Achieving these goals
will require us to maintain stable high ratings in our regular programming. To this end, we will increase
personnel in production sections, strengthen relationships with production companies and artist
management companies, and continue to enhance sports content. We will also review our morning and
daytime news and information programming and improve practices that capture higher viewer ratings.
Our enhanced production capabilities will enable us to exercise our creativity to continually develop
new content that can be distributed across diverse media outlets. By securing production budgets and
promoting a corporate culture that values the spirit of challenge, TV Asahi will become the leader in
content creation.
Expanding TV Advertising Revenues
Despite the current weak growth in the advertising market, TV Asahi will steadily regain market share in
order to achieve overall advertising revenue growth. Furthermore, as our advertising revenue is currently
weighted toward spot sales, we aim to expand the time sales ratio for a more stable revenue stream.
Our target is to increase time revenue from our regular programming, which is contingent upon our
increasing viewer ratings.
For spot sales, we will continue to raise our spot market share. We will also proactively respond to
sponsors’ needs by thinking out of the box and advancing projects and services across various marketing platforms, including the Internet, special events and the One-Seg service.
Exercising “Selection and Concentration” of Nonadvertising Businesses
TV Asahi will enhance nonadvertising businesses by selecting and concentrating on profitable areas.
We will focus our efforts on the development and distribution of content that creates synergy between
terrestrial broadcasting and other media outlets. Particularly, investment in motion pictures is an area
where we believe more opportunities for synergy can be sought.
For example, in the past TV Asahi drew large audiences with two theatrical releases of the popular TV
drama series TRICK. Moreover, video and DVD sales of the drama series and the two feature films also
recorded high sales. Going forward, we will continue to strengthen our relationships with film studios
while actively pursuing ventures in which we can increase our control of the film productions.
In the TV shopping business, we will streamline the group and parent company’s operation of the
business and gradually shift to an e-commerce growth strategy.
In our Internet-related business, our current focus is on providing TV program-related content on
subscription-based mobile phone services. In the future, however, we will also pursue business opportunities on the Internet that will expand the TV Asahi fan base.
In our special events business, we will continue to sponsor and develop various events, including
major events for TV Asahi’s 50th Anniversary Celebration.
Growth of Group Companies
For TV Asahi to continue to grow, we must strengthen our group companies. As such, we will bolster
opportunities for expansion and encourage the development of new lines of business.
TV Asahi Music Co., Ltd., handles the music publication arm of the TV Asahi Group and has been
successful in artist management. Going forward, we will expand the music publication business by
cooperating with network affiliate stations to identify and recruit budding talent on a nationwide basis.
Moreover, we will reassess our financial investments in group companies to boost the content pro-
duction capability of the TV Asahi Group. We will also combine our data broadcast production functions
to make operations more efficient.
TV Asahi will also expand its content business management. As an initial step, we have established
BrostarTV LLC as a joint venture with DIGITALSCAPE Co., Ltd., with the aim of scouting for and
developing new content, and expanding our content licensing business. The new company runs the
BrostarTV website, to which professional and semi-professional content creators upload their content
for public review and competition. One of TV Asahi’s late night shows in the past, The Frogman Show—
a computer-generated animation—was discovered on this site. We will work to develop BrostarTV into
one of our future sources for new content.
Movie: RUN AWAY/ Toyojun
BrostarTV home page
Game: The Tower of Moai/ Takahirou
Companywide Reform Campaign Overview
TV Asahi’s five-year Companywide Reform Campaign brought about
extensive changes for the Company. Viewer ratings and overall
performance increased dramatically. Especially in prime time ratings,
TV Asahi’s standing has risen and the Company is now vying for the
number two position. Our reputation among sponsors and viewers
has improved, and TV Asahi is now known to be strong in sports and
entertainment shows, in addition to being the leading station for
news and information programs.
Forever a big TV Asahi fan!
Go for the Top!
I want to deliver wonders
and sensations as they are!
Review of the Companywide Reform Campaign
In June 2002, TV Asahi launched the Companywide Reform Campaign to prompt structural reforms
across the Company. Until then, TV Asahi had perennially been number four in the industry in terms
of viewer ratings, income and reputation. The aim of the Companywide Reform Campaign was to give
end to the stagnation within TV Asahi and instill a culture that values challenge and the determination to
prevail in a competitive environment.
To achieve such objective, we set high goals in our Companywide Reform Campaign: 1) achieve the
top prime time rating, 2) transform into a company with a high-profit structure and 3) build a corporate
culture that enables the pursuit of individual aspirations and ideals. Among these goals and throughout
the term of the Companywide Reform Campaign, our top management priority was to capture higher
ratings. The main focus of Phase One of the Companywide Reform Campaign (June 2002 to March
2005) was to increase viewer ratings, and our major objective in Phase Two (April 2005 to March 2007),
was to consistently achieve high ratings.
We adopted various measures to achieve these goals. To raise ratings, we rejuvenated the executive
team in the programming production section, the most important area of broadcasting operations. This
created clearer lines of responsibility and smoother communication between the executive team and the
production staff. We also channeled more personnel into the production sections to reinforce creative
capabilities. Moreover, we established the practice of promoting popular late-night shows to prime time
which enhanced the quality of our entertainment shows.
In sports programming, we broke our old ratings records one after another by broadcasting high-
profile international matches through our exclusive contract with the Asian Football Confederation (AFC).
In TV dramas, numerous successful large-scale special programs cemented bonds of trust between
production staff, actors and entertainers.
TV Asahi also established a structure to support and promote programs on a companywide scale.
We applied new approaches to marketing and advertising programs, which drove a steady stream of
programs to capture mainstream interest.
This resulted in dramatic increases in TV Asahi viewer
ratings across all time slots during the five-year period. In
particular, in fiscal 2006 the Company achieved its first solo
number two ranking in prime time, as well as the number one
position in prime time 2 for two consecutive years—fiscal 2006
and fiscal 2007.
TV Asahi’s business performance is also trending upward.
Higher ratings are generating increased advertising revenues,
and our nonadvertising businesses—such as special events,
TV shopping and investment in motion pictures—are expanding into new territories.
Think in the other
person’s shoes!!
Live soccer broadcasts—
keep smiling, even in
remote locations!!
Love TV, Love TV lovers.
TV Asahi’s Viewer Ratings by Rating Time Periods
In the five-year span of the Companywide Reform
Source: Video Research Ltd.
(%)
Campaign, we have strengthened the source of our competi-
14
tive advantage. We implemented organizational reforms,
12
vastly improved the capabilities and motivation of staff
10
engaged in program production, and enhanced our ability to
create content that reflects the corporate values of TV Asahi.
8
The success of the Companywide Reform Campaign is the
6
2003
foundation on which we will expand our corporate mission.
2004
2005
All-Day (6 a.m. — midnight)
Golden Time (7 p.m. — 10 p.m.)
2006
2007
Prime Time (7 p.m. — 11 p.m.)
Prime Time 2 (11 p.m. — 1 a.m.)
Overview of Fiscal 2007
Viewer Ratings
TV Asahi’s new programming plans for fiscal 2007 involved developing new programs and
drama series, allocating programs to their ideal time slots, expanding morning programming
and producing major sports events. We put in our utmost efforts to achieve ratings of 13.0%
or higher in golden time and prime time, and 8.0% or higher in all-day and prime time 2, as set
forth in our goals for Phase Two of the Companywide Reform Campaign. While we attained
an 8.6% rating in prime time 2 for the year—0.6 percentage point over our target—our 11.4%
golden time rating, 12.2% prime time rating and 7.5% all-day rating all fell short of our targets.
2006 FINA Synchronised
Swimming World Cup
In sports programming, the TV Asahi broadcast of the Japan vs. Croatia game during 2006
FIFA World CupTM Germany achieved a remarkable 52.7% rating, the highest in the Company’s history.
Our exclusive broadcast of the 2006 Grand Prix of Figure Skating Final garnered an average 14.3% rating,
and the 2006 FINA Synchronised Swimming World Cup attained a four-night average rating of 13.2%,
reinforcing TV Asahi’s image as a broadcaster with a strong sports lineup.
Entertainment shows remained popular, with Takeshi’s TV Tackle sustaining high ratings and London
Hearts and Golden Legend continuing to attract viewers with their original content. Night-time entertainment
shows at 11 p.m. continue to enjoy a strong following, particularly from young viewers.
In the drama genre, the detective drama Partners hit a series high of 16.3% in average ratings during
Viewer Ratings for Japan’s Top Four Commercial Broadcasters
(%)
Source: Video Research Ltd.
(%)
(%)
(%)
12.0
16
16
10
10.5
14
14
9
9.0
12
12
8
7.5
10
10
7
6.0
8
2003
2004
2005
2006
2007
All-Day (6 a.m. — midnight)
TV Asahi
Company A
8
2003
2004
2005
2006
Golden Time (7 p.m. — 10 p.m.)
Company B
Company C
2007
6
2003
2004
2005
2006
Prime Time (7 p.m. — 11 p.m.)
2007
2003
2004
2005
2006
Prime Time 2 (11 p.m. — 1 a.m.)
2007
its fifth season. Hitoshi Tadano, the Extraordinary Undercover Detective, airing on the Friday night drama
slot from 11 p.m., achieved ratings of 14.4%.
In news and information programming, Hodo Station turned in an average rating of 14.1% for the
year by maintaining its faithful viewer base.
On the other hand, our new drama series and other regular programming lacked overall momentum,
compared to the previous year. We will continue to work on enhancing such programs as we strive to
TV Asahi’s Time Sales
Revenues (Non-Consolidated)
attain stable high ratings.
(Billions of yen)
100
Advertising Revenues (Non-Consolidated)
Time Revenue
75
As a rule, network time is sold in six-month blocks under program sponsorship contracts. Since higher
50
time sales are closely linked to a broadcaster’s ability to sustain consistently high ratings in regular programming, TV Asahi focuses on maintaining stable high ratings for each program in prime time. Major one-
25
off programs, such as sports events and special dramas, influence time sales as well. We therefore strive
0
2003
2004
2005
2006
2007
to secure rights to major sports events and develop special programs that will lead to higher time sales.
In fiscal 2007, time sales reached ¥95.7 billion, up ¥1.5 billion on a year-on-year basis. Time sales for
regular programming remained strong, supported by the improved sales performance of programs with
stable high ratings, as well as special programming such as 2006 FIFA World CupTM Germany, the 2006
FINA Synchronised Swimming World Cup, the Grand Prix of Figure Skating Series and special drama
10
TV Asahi’s Spot Sales Revenues
and TV Asahi’s Share of Spot Sales
(Non-Consolidated)
(Billions of yen)
120
(%)
26
90
22
60
18
30
14
mini-series Freezing Point.
Spot Revenue
TV Asahi’s spot ads target the Kanto region, the area surrounding Tokyo. In fiscal 2007, spending on
advertising in the Tokyo spot market decreased 2.3% from the previous fiscal year, and TV Asahi’s spot
sales fell ¥1.4 billion, to ¥99.4 billion. However, our share of the spot market in the Kanto region reached
0
10
2003
2004
2005
2006
2007
Spot Sales
TV Asahi’s Share of Spot Sales
20.9%, surpassing the previous year’s 20.8% and marking the fourth straight year of growth. Although
we recorded increased revenues from the “service and entertainment” industry segment, which includes
telecommunications; and the “publishing” segment, which includes magazines and music CDs; we
experienced a sharp decline from the “finance and insurance” industry segment, which recorded high
sales in the previous year; as well as a decrease from the “retail” and “automobiles” sectors.
Nonadvertising Revenues (Non-Consolidated)
Advertising revenues are prone to considerable fluctuation, depending on the economy. To create a
financial structure that is more resilient to changes in the domestic economy, TV Asahi strives to secure
revenues from activities other than advertising. We are actively engaged in businesses that utilize our
infrastructure and content as a TV broadcaster. These include TV shopping, special events production,
investment in motion pictures and subscription-based services for mobile phones.
I want to make
everyone beautiful!
Major Nonadvertising Revenues (Non-Consolidated)
(Billions of yen)
6.0
4.5
4.3
3.3
3.6
3.1
2.4
2.2
1.5
1.4
0.9
1.4
1.2
0.8
1.7
2.1
1.8
1.3
1.1
1.5
1.8
2.1
1.9
1.5
0.1
0
5.0
3.8
3.0
1.5
4.7
0.3
0.1
0.5
0.3
0.4
0.0
0.0
0.0
0.1
2003 2004 2005 2006 2007
2003 2004 2005 2006 2007
2003 2004 2005 2006 2007
2003 2004 2005 2006 2007
2003 2004 2005 2006 2007
2003 2004 2005 2006 2007
2003 2004 2005 2006 2007
Special Events
Motion Pictures
Video and DVD
TV Shopping
Internet–based Operations
Merchandise Sales
CS Broadcasting
Our TV shopping business continues to grow, supported by a number of hit products showcased
during the TV shopping segment of information program Chii Sanpo—broadcast in the morning—and
the late-night TV shopping show Selection X.
Our special events business sponsored the popular Fuji Rock Festival and Summer Sonic 2006
music events, both which have become summer traditions. Other major special events include the
British Museum exhibition Mummy: the Inside Story, exhibition of Centre Pompidou Artistes Étrangers à
Paris 1900–2005 and the Broadway musical West Side Story.
Doraemon
©Fujiko-Pro, Shogakukan, TV Asahi,
Shin-ei, ADK 2007
In the motion picture investment business, we released a number of successful films. Feature film
versions of animation programs, such as Doraemon and Crayon Shin-chan, continued to draw many movie
fans to theaters. In addition, TRICK The Movie 2—the second feature film release of our drama series
TRICK—attracted even larger audiences than the first release. The samurai epic Love and Honor, starring
11
Takuya Kimura and directed by Yoji Yamada, became a major hit with ¥4 billion in box-office receipts.
In the communication satellite (CS) business, TV Asahi took over the operation of TV Asahi Channel,
a CS channel, from CS One Ten, Ltd., and the number of subscribers has been increasing.
TV Asahi also carried out aggressive marketing activities in its Internet businesses, such as “Tele Asa
com·plete!,” a subscription-based information service for mobile phone users, as well as in video and DVD
repackaging of popular TV programs, publishing activities and merchandise sales.
Music Publication Business
TV Asahi Music Co., Ltd., handles TV Asahi’s music publication business.
HY, one of the company’s exclusive artists, released their fourth album
Confidence, and tickets for their concert tour sold out at venues across
Japan, contributing to sales. KETSUMEISHI also released two singles—
Tabiudo in April and Danjo Rokunin Natsu Monogatari in July—and Shonan
no Kaze released their third album, Shonan no Kaze ~Riders High~, in
August, garnering support from legions of fans.
TV Asahi Music will continue to scout for and develop promising new
talent and will strive consistently to deliver hit artists and hit songs.
Onward! Hand in hand
with the times.
Confidence
(HY)
Danjo Rokunin
Natsu Monogatari
(KETSUMEISHI)
Shonan no Kaze
~Riders High~
(Shonan no Kaze)
Lifelong memories from
a momentary dream!!
TV Asahi’s Broadband Businesses
TV Asahi offers a variety of broadband services aimed at raising the value of its content and
diversifying its revenue streams.
Diverse Broadband-based Services
Our broadband business is part of our effort to expand our content distribution activities. The “TV
Asahi bb” site, accessible from the TV Asahi home page, offers subscription-based video content,
such as news, animation, professional wrestling and children’s programs. We have also enriched
our shopping site, which allows consumers to purchase items presented on our TV shopping
programs and other program-related merchandise. We have implemented an easy-to-use ordering
TV Asahi bb site
format to facilitate the buying process. Additionally, “Tele Asa com.plete!,” a subscription-based
content distribution service on mobile phones, offers news and downloadable content related to
dramas, animation and entertainment shows.
Joint Study of One-Seg Service
One of the enhanced services made available through terrestrial digital broadcasting is One-Seg,
a broadcast service for mobile phones and other mobile devices which commenced in April 2006.
One-Seg is a free-of-charge service using airwaves and it enables users to watch TV programs
and receive data broadcasting. Data broadcasting, which delivers news and program information,
12
allows users to link to fee-based mobile sites as well.
TV Asahi performed a joint study with KDDI, a major telecommunications company, to assess
the potential of One-Seg as a medium for content distribution and advertising, and as a means for
One-Seg service
conducting e-commerce. Our research verified that One-Seg data broadcasting links can be used to
efficiently guide viewers to fee-based sites on various online media. Currently, the broadcast content
on One-Seg is the same as that of terrestrial television, but in 2008 independent programming is
scheduled to become available on One-Seg. TV Asahi will continue to examine and evaluate new
business models on One-Seg with the development of independent programs in mind.
Use of Broadband Technology in Live Shows
Once a year, TV Asahi airs Test the Nation, an annual live-broadcast program that gauges the IQ
of viewers. This special program provides an interactive service during the broadcast that enables
Test the Nation
(Data broadcasting)
viewers to participate via computer, mobile phone, terrestrial digital data broadcasting and OneSeg service. This groundbreaking service tabulates online participant data and reflects the data
gathered in the program in real time.
Test the Nation became popular across Japan when it debuted in fiscal 2003. In fiscal 2007,
the program focused on testing the viewers’ emotional intelligence, “EQ,” and drew hits from a
large number of viewers through terrestrial digital data broadcasting—over twice as many as in the
previous year.
Test the Nation
(One-Seg service)
This use of broadband in a live show attracted considerable interest from the TV industry as a fine
example of how broadband can complement terrestrial digital broadcasting. TV Asahi will continue to
research and develop methods of data broadcasting to enhance the television viewing experience.
Japan’s TV Industry and Terrestrial Digital Broadcasting Efforts
The transition to digital broadcasting is triggering major changes in Japan’s TV industry.
This new business environment presents a vast potential for new services that highlight the
cooperation between broadcasting and telecommunications.
Regulation in the TV Industry
Expansion of the Terrestrial Digital
Broadcasting Area
Japan Broadcasting Corporation—the publicly funded broadcaster more familiarly known as NHK—and five key commercial
In line with government policy, terrestrial digital broadcasting
broadcasters in Tokyo are the leaders in the national TV industry.
commenced in December 2003 in three regions: Kanto, centering
The industry is regulated by the Radio Law and Broadcast Law.
on Tokyo; Chukyo, surrounding Nagoya; and Kinki, covering
Radio waves are considered a public good, and thus, a company
Kyoto, Osaka, Kobe and Nara. The terrestrial digital broadcasting
must attain a license from the government in order to engage in
area was launched in all prefectural government locations in
broadcasting operations.
December 2006, with conventional analog broadcasting sched-
uled to terminate in July 2011. As of December 1, 2006, the
Broadcasters have a duty to serve the public. They must abide
by various rules and regulations in their broadcasting business,
reach of terrestrial digital broadcasting has expanded to cover
such as providing emergency reporting in times of natural disasters,
84.0% of all households in Japan.
upholding public order and standards of decency in broadcast
content and taking a politically impartial stand.
national government’s strategy to promote information technol-
ogy, and its implementation will make more effective use of
Commercial broadcasters transmit programs to viewers free
The digitization of terrestrial broadcasting is part of the
of charge, and each broadcaster relies primarily on its advertis-
airwaves and raise broadcasting quality. Terrestrial digital
ing revenues for funding. A voluntary limit is set on the amount
broadcasting offers the advantages of high-definition picture and
of advertising a network can run by The National Association of
high-fidelity sound quality, as well as electronic program guides,
Commercial Broadcasters in Japan.
interactive services, data broadcasting and other features that
benefit the elderly and the disabled.
The Nationwide Network of Key Stations and
Affiliate Stations
TV Asahi is making steady progress toward the full nationwide
transition to digital broadcasting in 2011, bringing the high-defi-
There are 127 commercial broadcasters in Japan. Commercial
nition rate of its programming up to 82.3% for all-day and 100%
broadcasting licenses are issued for each district and are valid
for prime time (as of April 2007). TV Asahi will continue to provide
for a specific zone therein. In addition, to enable as many people
broadcasting services that take advantage of digital technology,
as possible to engage in free speech through broadcasting, the
such as program-related data broadcasting, Dolby Digital 5.1ch
Radio Law limits ownership of local stations by the five key com-
surround for regular programs and One-Seg services for mobile
mercial broadcasters in Tokyo.
phones and other portable devices.
The five key commercial broadcasters in Tokyo have built
national affiliate networks with local stations to ensure comprehensive news coverage. Another important feature of having a
national network is the nationwide reach of commercials, which
makes time sales possible.
Thus, affiliate stations are not subsidiaries or affiliates in the
corporate sense, but they are valuable partners in the execution
of broadcasting operations.
13
Protecting the Environment, Contributing to Society
While TV Asahi fulfills its public duty and mission through its TV broadcasting business,
the Company is also actively involved in protecting the environment and contributing to the
well-being of society.
14
Ongoing Improvement of Environmental
Management Systems
summer vacation event called tv asahi no tv asobi (“TV fun at TV
TV Asahi has produced programs, such as the documentary
Asahi”). The project put us in direct contact with a large number
Spaceship Earth and Naturing Special, that emphasize the
of viewers, giving them enjoyable insights into the workings of
importance of protecting the environment.
a TV station. Events included interactive experiences of news
reporting, animation sound-overs and weather forecasting, and
Moreover, we also practice environment-friendly measures
In addition, in August 2006 the Company held a hands-on
throughout our day-to-day business activities, including setting
tours included a satellite news gathering truck and a virtual
up environmental improvement projects. For example, the Archive
production set.
Operation & Reengineering Department has incorporated various
procedures that lessen our burden on the environment, such as
to promote media literacy. In order to obtain an objective evalua-
collecting used videotapes and implementing a recycling program.
tion of and advance its efforts, TV Asahi will perform a joint study
In July 2002, these efforts were recognized by the International
with the Graduate School of Interdisciplinary Information Studies
Standards Organization with ISO 14001 certification, the interna-
at the University of Tokyo over a three-year period beginning
tional standard for environmental management systems.
June 2007. This study, called PROJECT ROPPON, will focus
Since acquiring ISO 14001, TV Asahi has continued to
on building a new media literacy framework that fosters mutual
enhance its environmental management practices. We review
learning between broadcasters and the community. Moreover,
routine practices in detail to identify ways to reduce the impact
we intend for the new framework to be widely used by TV Asahi’s
our daily operations have on the environment, saving energy and
affiliate network stations and other broadcasters.
TV Asahi conducts these integrated learning support activities
materials by promoting the effective and efficient use of natural
Social Contributions through the TV Asahi
Social Welfare Organization
resources.
Integrated Learning Support Activities
The TV Asahi Social Welfare Organization (the “Organization”)
TV Asahi has conducted tours of its facilities since November
was established in 1977 as the first social welfare Organization
2003 as part of its integrated learning support activities for stu-
in the commercial broadcasting industry. Since its founding,
dents from the elementary school to university levels. As of March
the Organization has promoted broad-ranging programs for the
31, 2007, 1,036 schools throughout Japan have participated.
elderly, the mentally and physically disabled, and children.
In February 2005, TV Asahi began offering “Cater Classes,”
Welfare activities for the elderly include “rehabilitation danc-
through which TV Asahi personnel visit schools and teach
ing,” an activity the Organization has promoted for the past 20
classes, the first such endeavor for a key Tokyo station. As
years, visiting nursing homes mainly in the Kanto area. TV Asahi
of March 31, 2007, 44 employees have visited 182 schools,
has also sponsored visits to nursing homes by veteran singers
offering interactive classes that give students a look into news
since 1989. Marking the 100th visit, actress Mitsuyo Asaka held
broadcasting and other TV station activities.
a special sword-dance show, and celebrity reporter Masaru
Nashimoto held a talk show.
TV Asahi also sponsors activities for mentally and physically
challenged individuals. Such activities include rehabilitation with
the cooperation of the Tokyo Music Volunteer Association, national
blind judo tournaments, wheelchair basketball tournaments and a
national sign language speech contest for high school students.
“Cater Classes”
tv asahi no tv asobi
(“TV fun at TV Asahi”)
Nursing home visit by Mitsuyo Asaka
Wheelchair basketball tournament
(Photograph by Kazuji Shimizu)
1st Philanthropy LPGA Players Championship
Sumo wrestling charity event
Homestay abroad: River rafting in Oregon
Welfare activities for children include the annual sponsorship of
in Taiwan (September 1999), the volcanic eruptions and earth-
homestays abroad for high school students in Tokyo orphanages.
quakes that hit the Izu Islands off the coast of Tokyo (summer
Most recently, participants engaged in volunteer activities and
of 2000), the Niigata Chuetsu earthquake (October 2004), the
enjoyed river rafting in Oregon, U.S.A.
earthquakes and tsunamis in the Indian Ocean (December 2004)
the Northern Pakistan earthquake (October 2005) and the Java
TV Asahi believes in the importance of grass-roots commu-
nity activities. In line with this view, the Organization participated
earthquakes (May and July 2006). The collected funds were
in the Ministry of Justice-sponsored “The 56th Brighter Society
delivered to the affected regions through the TV Asahi Social
Campaign” Healthy Development of Youth Event in Roppongi—
Welfare Organization.
held in the Roppongi Hills Arena in Tokyo—inviting the world-
Selected for the FTSE4Good Index Series
renowned jazz trumpeter Terumasa Hino. In addition, the
Organization sponsored the 1st Philanthropy LPGA Players
TV Asahi has been selected for inclusion in the FTSE4Good
Championship, a women’s golf tournament aimed primarily at
Index Series, a measure of corporate social responsibility
supporting child and maternal welfare and child welfare efforts.
(SRI index) developed by FTSE, an independent U.K.-based
Donations, such as 10% of player winnings, 10% of spectator
company that provides equity and bond indices to investors.
entrance fees and revenues from various spectator events were
given to infant homes, orphanages and nursery schools across
performance of companies that meet globally recognized cor-
Japan through the Organization.
porate responsibility standards and is applied widely throughout
The Company also sponsors sumo wrestling charity events
the world. Companies are selected according to their work
in cooperation with the Nihon Sumo Kyokai, with the intention
towards environmental sustainability, their development of
of raising awareness of social issues, such as traffic safety.
positive relationships with stakeholders and their championing
The proceeds from such events are donated to organizations
of and support for universal human rights.
involved in relevant social welfare programs.
that our wide-ranging public efforts have been internationally
In 1999, TV Asahi set up the Doraemon Charity Fund.
The FTSE4Good Index Series is designed to measure the
TV Asahi’s inclusion in the FTSE4Good Index Series indicates
Doraemon is one of the most popular animation characters in
recognized. Such efforts include an array
Japan, and the animation series has been broadcast on the
of environmental protection activities, aid
TV Asahi network since 1979. The fund provides assistance to
to disaster sites in Japan and overseas
victims of natural disasters both in Japan and abroad. To date,
through the Doraemon Charity Fund and
TV Asahi has undertaken 10 fundraising campaigns to help
other societal contributions through the
the victims of large natural disasters such as the earthquake
TV Asahi Social Welfare Organization.
15
Corporate Governance
TV Asahi has a management supervision system that hinges on the maintenance of
compliance-based internal controls
Basic Policy on Corporate Governance
Practices Department. Reports on the status of activities are
TV Asahi regards the reinforcement of corporate governance
submitted to the Council of Executive Directors and other perti-
measures to be one of the most essential tasks of management.
nent councils.
The Company’s management supervision system relies on the
practice of ethics and corporate compliance.
reports on the progress of business activities to the Board of
Directors. As a rule, the Board meets once a month.
Moreover, in the establishment of its corporate governance
Under this structure, Executive Officers also present detailed
policy and all its operations, TV Asahi aims to pursue profits in
an equitable manner without forfeiting its fundamental duty to
decisions determined at Board meetings and execution of busi-
serve the public. In particular, in light of TV Asahi’s corporate
ness activities are undertaken in accordance with prevailing laws,
character, it is both crucial and strategic for TV Asahi to continue
the Company’s Articles of Incorporation and other regulations,
to contribute to society, to provide vital information and enter-
and to make certain that business activities are executed in an
tainment to viewers and to maintain good relationships with all
appropriate and responsible manner.
our stakeholders.
It is the Board of Directors’ duty to ensure that management
It is the corporate auditors’ task to examine the execution of
business activities by the Board of Directors from the perspec-
Corporate Governance Structure
16
Of TV Asahi’s 21 Board members, five are from outside the
tive of legality and appropriateness to the Company’s entire
scope of operations.
Company. In addition, three of our five corporate auditors are
Internal Controls as the Cornerstone of
Compliance
external auditors.
Business activities are carried out by executive officers who are
appointed by the Board and also by full-time internal members of
TV Asahi considers the continual monitoring and reinforcement
the Board who assist the executive officers. The meetings of the
of internal controls to ensure fairness in the activities of the
Board of Directors are attended by the five corporate auditors.
TV Asahi Group to be one of the most important tasks of
Full-time internal directors form the Council of Executive Directors,
management. This includes efforts to establish adequate internal
which as a rule holds weekly meetings. Business activities are
control mechanisms. As a company with corporate auditors, TV
reported and discussions are held concerning the operation of the
Asahi already has a management supervision system in place.
business sections for which the respective directors are respon-
However, the Company has additionally set up a Compliance
sible. The Council effectively acts as the checking mechanism for
Management Office to support the work of auditors, and will
the execution of each business activity.
continue to strengthen its supervision system through mainte-
nance of compliance-based internal controls.
The Company’s outside directors apply their extensive experi-
ence and expertise to offer suggestions to increase corporate
value through new business expansion and content develop-
Compliance Program for its employees to reinforce the
ment.
importance of abiding by the law. Within this structure, matters
Routine business activities by employees are covered by
are dealt with primarily through the Compliance Management
internal control mechanisms. Powers and responsibilities are set
Department, and overall responsibility lies with the President.
out by written regulations pertaining to organizational authority,
Under his direction, TV Asahi has established rules and systems
and when necessary, these are checked by a number of internal
for appropriately addressing compliance matters, including
departments such as the Compliance Audit Department, the
compliance-related inquiries, investigation of the causes of
Legal Affairs Department and the Broadcast Standards and
violations and formulation of measures to prevent recurrence.
The Company maintains a Compliance Manual and
Financial Section
18 Five-Year Summary
19 Management’s Discussion and Analysis
24 Consolidated Balance Sheets
26 Consolidated Statements of Income
27 Consolidated Statements of Changes in Net Assets
28 Consolidated Statements of Cash Flows
29 Notes to Consolidated Financial Statements
38 Independent Auditors’ Report
17
Five-Year Summary
Years ended March 31, 2007, 2006, 2005, 2004 and 2003
Millions of yen
2007
2006
2005
Thousands of U.S.dollars
2004
2003
2007
For the year: Net sales:
TV broadcasting business:
¥251,125
¥249,384
¥242,037
¥218,079
¥209,035
$2,127,277
219,410
218,813
213,640
195,081
194,329
1,858,619
Network time 95,110
93,384
91,299
88,146
89,040
805,676
Spot 99,071
100,563
98,125
84,606
83,330
839,229
Sales of programs 11,381
11,303
11,310
11,220
11,062
96,408
Other 13,848
13,563
12,905
11,109
10,897
117,306
Music publication business Other businesses Cost of sales 9,195
10,759
9,071
7,227
4,061
77,891
22,520
19,812
19,326
15,771
10,645
190,767
177,476
172,179
165,775
156,125
147,000
1,503,397
Selling, general and administrative expenses
59,971
60,129
62,656
55,433
54,598
508,014
Operating income 13,678
17,076
13,606
6,521
7,430
115,866
Income before income taxes and minority interests
14,568
17,229
12,932
3,797
5,069
123,405
Net income 10,304
9,467
7,383
1,687
1,908
87,285
Capital expenditures 4,670
5,042
6,176
30,701
23,232
39,560
8,383
8,560
8,389
7,832
6,365
71,012
At year-end:
Total assets
¥314,466
¥316,080 ¥297,544 ¥288,967
¥294,047 $2,663,837
153,200
150,177
146,060
139,416
171,558
1,297,755
Net property and equipment
59,667
63,061
65,898
68,808
67,844
505,438
Total current liabilities 47,102
50,655
51,921
48,660
57,990
399,000
Total current assets 18
Interest-bearing debt Total net assets
—
—
862
3,212
—
249,444
244,514
228,139
— 221,907
217,261
2,113,037
¥ 10,242
¥ 9,226 ¥ 7,199 ¥ 1,560 ¥ 1,780 Per Share of Common Stock (Yen and U.S. dollars):
Net income—basic Cash dividends
$
87
1,400
1,500
1,300
700
700
12
245,678
241,216
225,237
219,193
214,555
2,081
1,006
1,006
1,006
1,006
1,006
—
1,218
1,234
1,250
1,262
1,278
—
Return on sales
4.1
3.8
3.1
0.8
0.9
—
Return on equity
4.2
4
3.3
0.8
0.9
—
Return on assets
3.3
3
2.5
0.6
0.7
—
78.6
76.8
76.2
76.3
73.4
—
Net assets
Other data:
Number of shares outstanding
(Thousands) Number of employees
(Non-consolidated) Key ratios (%):
Equity ratio
Notes: 1. For convenience only, U.S. dollar amounts have been translated from Japanese yen at the rate of ¥118.05 to US$1, the rate of exchange prevailing on the Tokyo Foreign Exchange Market on March 30, 2007.
2. For total net assets, see Note 1 ( l ) of the Notes to Consolidated Financial Statements.
3. For the calculation of per share of common stock, see Note 8 of Notes to Consolidated Financial Statements.
Management’s Discussion and Analysis
Significant Accounting Policies
The consolidated financial statements of the TV Asahi Group are prepared in accordance with accounting standards generally accepted in Japan as fair and appropriate. Some assets and liabilities, as well
as some income and expenses, are based on estimates and management interpretations at the time the
consolidated financial statements were prepared.
Operating Environment for TV Broadcasting Industry
During the fiscal year under review, negative factors affecting the Japanese economy included higher
oil prices, signs of potential decline in the U.S. economy, concerns of interest rate increases following
the cessation of the Bank of Japan’s zero interest rate policy, a worldwide decline in stock prices and
lagging consumer spending due to unchanging income levels. Nevertheless, the Japanese economy
sustained its gradual expansion, buoyed by a rise in corporate profits.
In the broadcasting industry, despite such large worldwide events as the 2006 FIFA World Cup™
Germany, the advertising market suffered as corporations reined in their advertising spending out of
concern for the potential economic impact of such factors as unstable weather conditions, raw material
price increases and the lagging recovery in consumer spending.
Business Performance
Under these economic conditions, the TV Asahi Group continued to focus on increasing earnings and
profits in its TV broadcasting, music publication and other businesses. As a result, during the year TV
Asahi (the “Company”) achieved a 0.7% increase in consolidated net sales, to ¥251,125 million. The
Net Sales and Percentage Growth
(Millions of yen)
300,000
(%)
12
19
225,000
6
150,000
0
75,000
-6
combination of cost of sales and selling, general and administrative expenses (“SG&A”) rose 2.2%, to
¥237,447 million, and the resulting decrease in operating income was 19.9%, to ¥13,678 million.
Net income rose 8.8%, to ¥10,304 million, due to a decrease in the Company’s tax payment, stem-
ming from the accounting of tax losses for the loss on devaluation of investment in affiliates posted in
fiscal 2006.
0
Following is a summary of business performance by segment. Figures for each segment are those
Net Sales
Percentage Growth
before the elimination of inter-segment sales (except for those used in graphs).
Performance by Business Category
TV Broadcasting Business
In network time sales, the Company successfully raised rates for regular programs, such as entertainment shows Quiz Presentation Variety Q-SAMA and London Hearts. Special one-off events that ben-
-12
2003 2004 2005 2006 2007
Sales from TV Broadcasting
Business
(Millions of yen)
240,000
180,000
efited the Company in the preceding fiscal year included the 2005 FINA World Championships Montreal
swimming event and the 2006 FIFA World Cup™ Final Asian Qualifiers. In the fiscal year under review,
the Company achieved good sales from 2006 FIFA World Cup™ Germany, the FINA Synchronised
Swimming World Cup 2006, the Grand Prix of Figure Skating 2006, the FINA World Championships
Melbourne 2007 and the special drama mini-series Freezing Point. As a result, network time sales
totaled ¥95,444 million, up 1.6% from the previous year.
For spot sales, the Company struggled with the 2.3% decline in the Tokyo spot market. TV Asahi
posted positive sales in the “services and entertainment” and “publishing” industry segments, but
experienced a substantial decline in the “finance and insurance” segment, which was strong during the
120,000
60,000
0
2003 2004 2005 2006 2007
preceding term, and marked negative growth in the “retail” and “automobiles” segments. Consequently,
spot sales decreased 1.4%, to ¥99,373 million.
Program sales rose 0.9%, to ¥11,987 million. Other revenues increased 2.5%, to ¥14,634 million,
owing to higher broadcasting-related revenue from Trust Network Inc., Housougijyutsusha Co., Ltd., and
other subsidiaries.
As a result, TV broadcasting sales rose 0.2%, to ¥221,438 million, while operating expenses
increased 1.5%, to ¥211,020 million. Operating income fell 19.3%, to ¥10,418 million.
Sales from Music Publication
Business
(Millions of yen)
12,000
Music Publication Business
The music publication and copyright management business grew favorably, boosted by the expanding
music distribution and download market.
9,000
In the music publication business, artist HY’s Confidence album, released in April 2006, and Shonan
no Kaze’s Shonan no Kaze~Rider’s High~, released in August 2006, were hits. In artist management,
performance by exclusive artists under management was strong, with HY and Shonan no Kaze’s con-
6,000
cert tour tickets selling out soon after sales commenced. Sales of artist-branded products at concerts
3,000
also increased. Thus, despite a falloff from the preceding year’s record-breaking performance,
0
2003 2004 2005 2006 2007
TV Asahi’s music publication business steadily gained industry presence.
Sales decreased 14.5%, to ¥9,349 million, and operating expenses fell 2.8%, to ¥7,459 million.
Operating income also declined 42.1%, to ¥1,890 million.
20
Sales from Other Business
Other Businesses
(Millions of yen)
24,000
Among investments in motion pictures, the animated picture Crayon Shin-Chan Densetsu wo Yobu
Odore! Amigo!, the comedy LOVELY COMPLEX and the action film Masked Rider Kabuto/ Bouken
Ranger The Movie attracted large audiences. The performance of Trick The Movie 2 surpassed that of
18,000
its first release, generating office receipts of ¥2.1 billion. The New Year’s release of samurai movie Love
12,000
and Honor, starring Takuya Kimura and directed by Yoji Yamada, was a major hit, accruing ¥4 billion
in box office receipts. Sakuran, the story of an Edo-era courtesan, was released in February, and the
6,000
second movie release of the new Doraemon animation series opened in theaters in March. Both pictures
0
2003 2004 2005 2006 2007
proved popular.
The Company sponsored various special events during the year. These included the Broadway musi-
cal West Side Story, a stage performance of the Company’s hit drama The Black Notebook, the Summer
Sonic 06 rock music event and the Centre Pompidou Artistes Étrangers à Paris 1900–2005 exposition.
The content distribution business generated substantial video and DVD sales from the Partners
drama series and the Uchimura Produce entertainment show. In TV shopping, sales from the Selection
X TV shopping program and the shopping segment in the Chii Sanpo information program contributed
to sales. Internet-based business, comprising mobile phone content subscription services, publishing
and merchandising, were also strong.
In April 2006, the Company took over the operation of the TV Asahi Channel—which is a channel on
communication satellite (CS)—from CS One Ten, Ltd. Higher sales from the CS business, as well as strong
results for videos and DVDs, pushed up sales from other businesses 12.8%, to ¥29,156 million. Operating
expenses grew 11.4%, to ¥27,684 million, and operating income rose 46.9%, to ¥1,472 million.
Income and Expenses
Net Sales
Segment sales information for the TV Asahi Group during the fiscal year under review is noted in the
Operating Income and
Operating Profit Margin
(Millions of yen)
18,000
(%)
10.0
previous section, Performance by Business Category. Total sales, including intersegment sales, grew
0.9%, to ¥259,943 million. Of this amount, intersegment sales accounted for ¥8,818 million, a 6.0%
increase from fiscal 2006. Excluding intersegment transactions, the Group posted 0.7% higher net
13,500
7.5
9,000
5.0
4,500
2.5
sales, of ¥251,125 million.
Cost of Sales and SG&A
0
Operating Income
Operating Profit Margin
Operating expenses totaled ¥237,447 million, inching up 2.2%, largely because of higher program production expenses and increases in other business expenses in line with higher other business revenues.
Operating Income
Operating income fell 19.9% from the previous fiscal year, to ¥13,678 million.
Other Income and Expenses
0.0
2003 2004 2005 2006 2007
Cost of sales grew 3.9%, to ¥177,476 million, while SG&A edged down 0.3%, to ¥59,971 million.
Net Income and Return on Sales
(Millions of yen)
12,000
(%)
6.0
9,000
4.5
6,000
3.0
3,000
1.5
Other income rose ¥737 million, to ¥890 million, the net result of higher interest and dividend income
and a ¥483 million decrease in the equity in losses of affiliates. This improvement resulted from a
decrease in the losses of Asahi Satellite Broadcasting Limited, an affiliate accounted for under the equity
0
Net Income
Net income rose 8.8%, to ¥10,304 million.
Financial Position
Assets
Total current assets rose ¥3,023 million, to ¥153,200 million, partly because of a ¥1,647 million increase
0
2003 2004 2005 2006 2007
method.
Net Income
Return on Sales
Total Assets
(Millions of yen)
320,000
240,000
160,000
in trade notes and accounts receivable.
Fixed assets declined ¥4,636 million from the previous year, to ¥161,266 million.
Although digital relay stations were constructed and added to tangible and intangible assets,
80,000
0
2003 2004 2005 2006 2007
depreciation and amortization of ¥8,383 million was largely responsible for a ¥3,871 million decrease in
this category. Total investments and other assets were down ¥766 million, to ¥95,820 million as a result
of a decrease of ¥1,634 million in other investments and other assets and an increase of ¥808 million in
investments in securities.
Return on Equity and
Return on Assets
(%)
6.0
Consequently, on March 31, 2007, total assets were ¥314,466 million, down ¥1,614 million from one
year earlier.
Liabilities
Current liabilities reached ¥47,102 million, down ¥3,553 million, mainly because of a large balance of
4.5
3.0
1.5
accrued income taxes at the end of the previous fiscal year. Non-current liabilities decreased ¥2,991
million, to ¥17,920 million. Consequently, total liabilities were ¥65,022 million, down ¥6,544 million, on
March 31, 2007.
0.0
2003 2004 2005 2006 2007
Return on Equity
Return on Assets
21
Net Assets
Net Assets and Equity Ratio
(Millions of yen)
280,000
(%)
100
Net assets for the fiscal period under review reached ¥249,444 million.
210,000
75
140,000
50
70,000
25
0
0
2003 2004 2005 2006 2007
Net Assets
Equity Ratio
From the fiscal period under review, the Group adopted the Accounting Standard for Presentation
of Net Assets in the Balance Sheet (Accounting Standards Board of Japan Statement No. 5, December
9, 2005) and the Guidance on Accounting Standard for Presentation of Net Assets in the Balance Sheet
(Accounting Standards Board of Japan Guidance No. 8, December 9, 2005).
Liquidity and Capital Resources
Cash Flow Analysis
During the fiscal period under review, cash and cash equivalents on a consolidated basis decreased
¥6,473 million, to ¥47,480 million.
Cash Flows from Operating
Activities
(Millions of yen)
28,000
Cash Flows from Operating Activities
Net cash provided by operating activities was ¥13,688 million, ¥5,830 million less than in the previous
year. Principal contributors were income before income taxes and minority interests, which at ¥14,568
million was ¥2,661 million less than for the preceding term, and a ¥1,609 million increase in trade notes
21,000
and accounts receivable.
14,000
Cash Flows from Investing Activities
7,000
Net cash used in investing activities totaled ¥18,748 million, ¥2,606 million less than in the preceding
22
term. The main reason for this change was a decrease in short-term investments and a decline in
0
2003 2004 2005 2006 2007
Cash Flows from Investing
Activities
(Millions of yen)
0
-6,000
purchase of investments in securities and investment in subsidiaries.
Cash Flows from Financing Activities
Net cash used in financing activities was ¥1,419 million, down ¥102 million, due to a decrease in dividends paid to stockholders.
Capital Requirements and Financing Policy
TV Asahi will use its own funds to develop and promote terrestrial digital broadcasting and to finance
-12,000
capital expenditures and other investments that will strengthen its content production capabilities.
-18,000
In April 2004, a cash management system was implemented whereby TV Asahi, as the head of the
corporate group, oversees fund-raising and cash management for the entire Group.
-24,000
2003 2004 2005 2006 2007
Outline of Capital Investment
Groupwide, capital expenditures totaled ¥4,670 million, the majority of which was for the TV broadcasting business. For this segment, capital expenditures totaled ¥4,373 million. Capital expenditures in the
music publication segment were ¥40 million, and investment in other businesses totaled ¥257 million.
These capital expenditures include investments in intangible assets.
Risk Information
Dependence on TV Broadcasting Business
TV Asahi derives most of its revenue from TV broadcasting, which relies on corporate advertising expenditure. This factor is in turn affected greatly by the state of the Japanese economy.
Moreover, within the TV broadcasting business, viewer ratings play an essential role in the determina-
tion of price in the sale of advertising time.
Thus, in the event the Japanese economy experiences a downturn and/or the Company is unable
to produce and broadcast programs that are widely popular with viewers, the operating results of the
Company may be influenced.
Competition, Capital Expenditures and Investments
Terrestrial digital broadcasting commenced in Japan on December 1, 2003. In tandem with the move to
its new headquarters building in the previous fiscal year, TV Asahi invested in the broadcasting equipment necessary for terrestrial digital broadcasting. The Company will continue to place management
priority on digital broadcasting until the nationwide transition to digital broadcasting is complete in 2011.
In addition, the advent of terrestrial digital broadcasting may intensify competition with other media
services, such as BS digital broadcasting, CS digital broadcasting, cable television and content broadcasting on broadband.
Therefore, the Company will continue to allocate appropriate capital expenditure and make other
investments to maintain technical standards, improve its content production competency, acquire
popular content and enhance its media strategy. If sufficient profits cannot be attained to balance such
investments, the operating results of the Company may be influenced.
Regulations (License and Foreign Ownership)
TV broadcasting is the Company’s main business. This business falls under various regulations, such
as the Radio Law and Broadcasting Law of Japan. To launch its TV broadcasting business, TV Asahi
was granted its broadcasting license on January 9, 1959, in accordance with the Radio Law, and the
Company commenced broadcasting on February 1, 1959. The Company has periodically renewed its
license since that time, as Radio Law stipulates a five-year license period.
The Radio Law prohibits a foreign national from being an executive director. The law also restricts to
less than 20% the ownership of voting rights in any free-to-air radio or television broadcaster by foreign
entities or by Japanese companies that are controlled by a foreign entity. In effect, the transfer of stock
registration to a foreign entity or Japanese companies controlled by a foreign entity may be rejected.
Moreover, if the total number of voting rights held by foreign entities or by Japanese companies
controlled by foreign entities reach 15%, the Company must disclose that fact, in accordance with the
Broadcast Law.
23
Consolidated Balance Sheets
March 31, 2007 and 2006
Thousands of
U.S. dollars (note 2)
Millions of yen
2007
2006
2007
¥ 16,215
¥ 27,972
$ 137,357
Trade notes and accounts receivable
64,830
63,182
549,174
Short-term investments (notes 3 and 13)
48,454
37,883
410,453
Inventories
14,128
14,294
119,678
Deferred income taxes (note 10)
1,561
1,907
13,223
Other current assets
8,083
5,013
68,471
71
74
601
153,200
150,177
1,297,755
Buildings and structures
21,896
22,643
185,481
Machinery and vehicles
19,039
21,419
161,279
Land
16,695
16,694
141,423
26
297
220
2,011
2,008
17,035
59,667
63,061
505,438
5,468
5,930
46,319
Assets
Current assets:
Cash (note 13)
Less allowance for doubtful receivables
Total current assets
Property and equipment, net of accumulated depreciation;
¥48,440 million ($410,335 thousand) in 2007 and
¥43,900 million in 2006:
Construction in progress
Other
Net property and equipment
24
Intangible assets, net:
Software
Other
Net intangible assets
311
326
2,635
5,779
6,256
48,954
75,281
74,473
637,704
988
1,110
8,369
19,734
21,368
167,167
183
365
1,550
Investments and other assets:
Investments in securities (notes 3 and 4)
Other investments and other assets
Less allowance for doubtful receivables
Total investments and other assets
Total assets
See accompanying notes to consolidated financial statements.
95,820
96,586
811,690
¥314,466
¥316,080
$2,663,837
Thousands of
Millions of yen
2007
2006
2007
¥ 14,672
¥ 15,341
$ 124,286
Other payables
13,202
12,715
111,834
Accrued expenses
16,932
15,317
143,431
394
4,740
3,337
Other current liabilities
1,902
2,542
16,112
Total current liabilities
47,102
50,655
399,000
16,896
17,235
143,126
840
3,498
7,116
Other non-current liabilities
184
178
1,558
Total non-current liabilities
17,920
20,911
151,800
Total liabilities
65,022
71,566
550,800
36,643
36,643
310,402
Liabilities and Net Assets
Current liabilities:
Trade notes and accounts payable
Accrued income taxes (note 10)
Non-current liabilities:
Liabilities for retirement and severance benefits (note 5)
Stockholders’ equity:
Common stock (note 6):
Authorized 3,000,000 shares; issued and
outstanding 1,006,000 shares in 2007 and 2006
Additional paid-in capital (notes 6 and 7)
Retained earnings (note 7)
Total stockholders’ equity
55,343
55,343
468,810
143,355
134,650
1,214,358
235,341
226,636
1,993,570
11,777
16,186
99,763
34
27
288
11,811
16,213
100,051
Valuation and translation adjustments:
Net unrealized gain on other securities (note 3)
Foreign currency translation adjustments
Total valuation and translation adjustments
Minority interests
Total net assets
2,292
1,665
19,416
249,444
244,514
2,113,037
¥314,466
¥316,080
$2,663,837
Commitments and contingencies (note 9)
Total liabilities and net assets
25
Consolidated Statements of Income
Thousands of
Millions of yen
2007
2006
2007
¥251,125
¥249,384
$2,127,277
177,476
172,179
1,503,397
73,649
77,205
623,880
59,971
60,129
508,014
13,678
17,076
115,866
Interest income
428
246
3,626
Dividend income
521
395
4,413
—
(1)
—
(206)
(689)
(1,745)
Net sales
Cost of sales (note 5)
Gross profit
Selling, general and administrative expenses (notes 5 and 11)
Operating income
Other income (deductions):
Interest expenses
Equity in losses of affiliates
Loss on devaluation of investments in securities and other investments
(19)
(55)
(161)
Other, net
166
257
1,406
890
153
7,539
14,568
17,229
123,405
3,113
7,640
26,370
837
(156)
7,090
3,950
7,484
33,460
10,618
9,745
89,945
Income taxes (note 10):
Current
Deferred
26
Income before minority interests
Minority interests
Net income
314
278
¥ 10,304
¥ 9,467
2,660
$
87,285
Consolidated Statements of Changes in Net Assets
Millions of yen
Stockholders’ equity
Balance at March 31, 2005
Common
stock
Additional
paid-in capital
(note 6)
(notes 6 and 7)
¥36,643
¥55,343
Valuation and translation adjustments
Retained
earnings
Net unrealized
gain on other
securities
Total
(note 7)
Foreign currency
translation
adjustments
Total
Minority
interests
Total net
assets
(note 3)
¥126,828
¥218,814
¥ 7,961
¥(46)
¥ 7,915
¥1,410
¥228,139
(1,509)
(1,509)
(1,509)
(141)
(141)
(141)
9,467
9,467
5
5
Changes arising during year:
Cash dividends
Bonuses to directors and
corporate auditors
Net income
Other, net
Total changes during the year
9,467
8,225
73
8,298
255
8,558
—
—
7,822
7,822
8,225
73
8,298
255
16,375
36,643
55,343
134,650
226,636
16,186
27
16,213
1,665
244,514
(1,409)
(1,409)
(1,409)
(186)
(186)
(186)
10,304
10,304
10,304
(4)
(4)
(4)
Cash dividends
corporate auditors
Net income
Other
Net changes other than
stockholders’ equity
(4,409)
7
(4,402)
627
(3,775)
—
—
8,705
8,705
(4,409)
7
(4,402)
627
4,930
¥36,643
¥55,343
¥143,355
¥235,341
¥11,777
¥34
¥11,811
¥2,292
¥249,444
Thousands of U.S. dollars (note 2)
Stockholders’ equity
Common
stock
$310,402
Additional
paid-in capital
Valuation and translation adjustments
Retained
earnings
Total
$468,810 $1,140,618 $1,919,830
Net unrealized
gain on other
securities
Foreign currency
translation
adjustments
$137,112
$229
Total
$137,341
Minority
interests
Total net
assets
$14,104 $2,071,275
Cash dividends
(11,936)
(11,936)
(11,936)
corporate auditors
(1,575)
(1,575)
(1,575)
87,285
87,285
87,285
(34)
(34)
(34)
(37,349)
59
(37,290)
5,312
(31,978)
73,740
73,740
(37,349)
59
(37,290)
5,312
41,762
$468,810 $1,214,358 $1,993,570
$ 99,763
$288
$100,051
Net income
Other
Net changes other than
stockholders’ equity
—
$310,402
—
$19,416 $2,113,037
27
Consolidated Statements of Cash Flows
Thousands of
Millions of yen
2007
2006
¥14,568
¥17,229
$123,405
2007
Cash flows from operating activities:
Adjustments to reconcile income before income taxes and minority interests to net cash provided by operating activities:
8,383
8,560
71,012
Loss on disposal of property and equipment
68
164
576
Loss on devaluation of investments in securities and other investments
19
55
161
206
689
1,745
Allowance for doubtful receivables
(186)
(142)
(1,576)
Decrease in liabilities for retirement and severance benefits
(424)
(26)
(3,592)
Interest and dividend income
(949)
(641)
(8,039)
Interest expenses
—
1
—
(1,609)
501
(13,630)
Decrease in inventories
166
248
1,406
Increase in trade notes and accounts payable
893
852
7,565
(Increase) decrease in trade notes and accounts receivable
Other, net
Sub total
Interest and dividend received
Interest paid
Income taxes paid
28
(931)
(783)
(7,886)
20,204
26,707
171,147
945
598
8,005
—
(1)
—
(7,461)
(7,785)
(63,202)
13,688
19,519
115,950
(5,704)
(1)
(48,319)
(Increase) decrease in short-term investments
1,314
(5,390)
11,131
(3,088)
(4,420)
(26,159)
Net cash provided by operating activities
Cash flows from investing activities:
Increase in time deposits
Proceeds from sale of property and equipment
Purchase of intangible assets
Purchase of investments in securities and investments in subsidiaries
Other, net
Net cash used in investing activities
65
11
551
(1,455)
(1,096)
(12,325)
(11,313)
(12,996)
(95,832)
1,433
2,538
12,139
(18,748)
(21,354)
(158,814)
(1,407)
(1,510)
(11,919)
(12)
(11)
(101)
(1,419)
(1,521)
(12,020)
6
62
51
Cash flows from financing activities:
Dividends paid to stockholders
Dividends paid to minority stockholders of subsidiaries
Net cash used in financing activities
Effect of exchange rate changes on cash and cash equivalents
Net decrease in cash and cash equivalents
(6,473)
(3,294)
(54,833)
Cash and cash equivalents at beginning of year
53,953
57,247
457,035
¥47,480
¥53,953
$402,202
Cash and cash equivalents at end of year (note 13)
Notes to Consolidated Financial Statements
1. Basis of Presentation and Summary of Significant Accounting Policy
(a) Basis of Presentation
TV Asahi Corporation (the Company) and its domestic subsidiaries maintain their books of account in conformity with the financial
accounting standards of Japan, and its foreign subsidiaries in conformity with those of the countries of their domicile.
The accompanying consolidated financial statements have been compiled from the consolidated financial statements filed with
the Ministry of Finance as required by the Securities and Exchange Law of Japan and include certain reclassifications and additional
financial information for the convenience of readers outside Japan.
(b) Principles of Consolidation
The Japanese consolidation standards define the scope of consolidation of subsidiaries and affiliates under the control or influence
concept. Under the control or influence concept, a company in which the parent company or its consolidated subsidiaries are able
to exercise control over operations either directly or indirectly, is fully consolidated, and a company over which the parent company
and/or its consolidated subsidiaries have the ability to exercise significant influence is accounted for by the equity method.
In accordance with these standards, the accompanying consolidated financial statements include the accounts of the
Company and all of its subsidiaries, whether directly or indirectly controlled.
The investments in affiliates are accounted for by the equity method, with the exception of certain affiliates that have no material
effect on the accompanying consolidated financial statements.
All significant intercompany accounts and transactions have been eliminated in consolidation.
The difference between the cost and the underlying net assets at the date of investments in subsidiaries or affiliates is allocated
to identifiable assets and liabilities based on fair market value at the date of investments. The unallocated portion of the difference,
which is recognized as goodwill or negative goodwill, is amortized using the straight-line method over five years.
(c) Cash and Cash Equivalents
For the purpose of the statements of cash flows, the Company considers cash equivalents to consist of all highly liquid investments
that have maturities of generally three months or less when purchased and that have insignificant risk of changes in value.
(d) Short-term Investments and Investments in Securities
Under the Accounting Standards for Financial Instruments, securities are classified into four categories – “trading securities,” “heldto-maturity securities,” “investment in affiliates” and “other securities.” Securities classified as “trading securities” are stated at fair
value and unrealized gains or losses are recorded in the consolidated statements of income. Securities classified as “held-tomaturity securities” are stated at amortized cost. Securities classified as “other securities” with fair value are stated at fair value and
unrealized gains or losses, net of related taxes, are excluded from earnings and recorded in a separate component of net assets. Realized gains and losses on those other securities are determined by the moving average cost. Debt classified as “other
securities” for which fair value is not available are stated at amortized cost. Equity securities classified as “other securities” for which
fair value is not available are stated at moving average cost. Holding securities of the Company are classified as held-to-maturity
securities and other securities.
(e) Inventories
Inventories are stated at cost. Cost is determined principally by the specific identification method.
(f) Property and Equipment
Property and equipment are stated at cost. Depreciation of property and equipment is calculated by the straight-line method, over
the estimated useful lives of the respective assets.
The estimated useful lives are as follows:
Buildings 15-50 years
Broadcasting equipment 6 years
(g) Intangible Assets
Intangible assets are carried at cost less amortization. Amortization of computer software for internal use is calculated by the
straight-line method, over the estimated useful life of five years. Amortization of other intangible assets is calculated by the straightline method at rates based on the estimated useful lives of the respective assets.
(h) Allowance for Doubtful Accounts
Allowance for doubtful receivables consists of the amount of uncollectible receivables based on historical loss ratios and the amount
that takes into account the possibility of certain liabilities.
(i ) Foreign Currency Translation
Under the Accounting Standards for Foreign Currency Transactions, receivables and payables denominated in foreign currencies
are translated into yen at the rate of exchange as of the balance sheet dates, and gains or losses resulting from the translation of
foreign currencies are credited or charged to income. Assets and liabilities, and revenues and expenses of overseas subsidiaries
are translated into yen at the rate of exchange as of the balance sheet dates. Thus, comprehensive adjustments resulting from
translation is presented in a net assets as “Foreign currency translation adjustments.”
29
( j ) Income Taxes
Income taxes in Japan applicable to the Company and its domestic consolidated subsidiaries consist of corporate tax, inhabitant
tax and business tax.
The Accounting Standards for Income Taxes require that deferred income taxes be accounted for under the asset and liability
method. Deferred tax assets and liabilities are recognized for the expected future tax consequences of events that have been
included in the financial statements or tax returns. Under this method, deferred tax assets and liabilities are measured using enacted
tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or
settled, and the effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that
includes the enactment date.
(k) Directors’ Bonus
Effective from the year ended March 31, 2007, the Company and its domestic consolidated subsidiaries adopted the “Accounting
Standard for Directors’ bonus” (Accounting Standards Board of Japan Statement No. 4, issued by Accounting Standards Board of
Japan on November 29, 2005).
According to the Standard, directors’ bonuses are accounted for as an expense when such bonuses are accrued, instead of
being accounted for as an appropriation of retained earnings upon approval at general meeting of stockholders. The effect of
adoption of the new standard was immaterial.
( l ) Presentation of Net Assets on Balance Sheet
Effective from the year ended March 31, 2007, the Company adopted the “Accounting Standard for Presentation of Net Assets in
the Balance Sheet” (Accounting Standards Board of Japan Statement No. 5, issued by Accounting Standards Board of Japan on
December 9, 2005) and the “Guidance on Accounting Standard for Presentation of Net Assets in the Balance Sheet” (Accounting
Standards Board of Japan Guidance No. 8, issued by Accounting Standards Board of Japan on December 9, 2005).
According to the Standards, former “Stockholders’ equity” is presented as “Net assets” and classified into “Stockholders’
equity,” “Valuation and translation adjustments” and “Minority interests.” “Minority interests” formerly listed after “Liabilities” is
included in “Net Assets.” The stockholders’ equity amounted to ¥247,152 million ($2,093,621 thousand) based on the former
classification.
30
(m) Impairment of Long-lived Assets
Effective April 1, 2005, the Company and its domestic consolidated subsidiaries adopted a new accounting standard for the
impairment of fixed assets (“Opinion Concerning the Establishment of an Accounting Standard for the Impairment of Fixed Assets”
issued by the Business Accounting Deliberation Council on August 9, 2002) and the “Implementation Guidance on the Accounting
Standard for the Impairment of Fixed Assets” (Business Accounting Standard Implementation Guidance No. 6 issued on October
31, 2003). The effect of adoption of the new standard was nil.
(n) Reclassifications
Certain reclassifications have been made to the prior years’ consolidated financial statements to conform to the presentation used
as of and for the year ended March 31, 2007.
2. Basis of Financial Statement Translation
The accompanying consolidated financial statements are expressed in yen and, solely for the convenience of the reader, have been
translated into United States dollars at the rate of ¥118.05=US$1, the appropriate exchange rate prevailing on the Tokyo Foreign
Exchange Market as of March 30, 2007. The translation should not be construed as a representation that any amounts shown
could be converted to U.S. dollars.
3. Short-term Investments and Investments in Securities
Balance sheet amount, fair value and gross unrealized gain and gross unrealized loss of held-to-maturity securities with fair value as
of March 31, 2007 and 2006 are summarized as follows:
Millions of yen
2006
2007
Balance sheet
amount
Government bond securities
Corporate bond securities
¥13,590
Gross
unrealized gain
¥ 0
Gross
unrealized loss
¥ (16)
Fair value
Balance sheet
amount
¥13,574
¥15,099
¥ (17)
Fair value
¥15,083
9,100
6
(201)
8,905
9,905
4
(272)
9,637
¥ 6
¥(217)
¥22,479
¥25,004
¥5
¥(289)
¥24,720
2007
Balance sheet
amount
Corporate bond securities
¥1
Gross
unrealized loss
¥22,690
Government bond securities
Gross
unrealized gain
$115,121
Gross
unrealized gain
$ 0
Gross
unrealized loss
$ (136)
Fair value
$114,985
77,086
50
(1,702)
75,434
$192,207
$50
$(1,838)
$190,419
Acquisition cost, balance sheet amount and gross unrealized gain and gross unrealized loss of other securities with fair value as
of March 31, 2007 and 2006 is summarized as follows:
Millions of yen
2006
2007
Equity securities
Acquisition
cost
Gross
unrealized gain
Gross
unrealized loss
Balance sheet
amount
Acquisition
cost
Gross
unrealized gain
Gross
unrealized loss
Balance sheet
amount
¥23,236
¥20,407
¥(588)
¥43,055
¥14,139
¥27,502
¥(320)
¥41,321
Debt securities
3,529
11
(13)
3,527
3,529
32
(35)
3,526
Other securities
1,529
47
—
1,576
2,028
51
—
2,079
¥28,294
¥20,465
¥(601)
¥48,158
¥19,696
¥27,585
¥(355)
¥46,926
2007
Equity securities
Acquisition
cost
Gross
unrealized gain
Gross
unrealized loss
Balance sheet
amount
$196,832
$172,868
$(4,981)
$364,719
29,877
Debt securities
29,894
93
(110)
Other securities
12,952
398
—
13,350
$239,678
$173,359
$(5,091)
$407,946
It is not practicable to estimate the fair value of the securities listed below as of March 31, 2007 and 2006 because of lack of
market price and difficulty in estimating fair value.
Thousands of
U.S. dollars
Millions of yen
2007
2006
Held-to-maturity securities:
Commercial paper
¥14,988
¥ 3,500
$126,963
Other securities:
Unlisted equity securities
¥13,019
¥12,857
$110,284
14,500
13,500
122,829
4,000
4,000
33,884
¥31,519
¥30,357
$266,997
Certificates of deposit
Cash in trust
2007
Projected future redemption of other securities with maturities and held-to-maturity securities at March 31, 2007 is summarized
as follows:
Millions of yen
Debt securities
Other securities
Due within one
year
Due after one year
through five years
Due after five years
through ten years
¥28,400
¥6,500
¥500
Due after ten
years
¥2,300
69
—
—
—
¥28,469
¥6,500
¥500
¥2,300
Due within one
year
Due after one year
through five years
Due after five years
through ten years
$240,576
$55,061
$4,235
Debt securities
Other securities
Due after ten
years
$19,483
585
—
—
—
$241,161
$55,061
$4,235
$19,483
4. Investments in Affiliates
The aggregate carrying amounts of investments in affiliates as of March 31, 2007 and 2006 are ¥6,380 million ($54,045 thousand)
and ¥6,565 million, respectively.
31
5. Retirement and Severance Benefits
The Company and its consolidated subsidiaries have noncontributory pension plans to provide retirement and severance benefits to
substantially all employees.
The principal pension plans are unfunded defined benefit pension plans. Under the plans, employees are entitled to lump-sum
payments based on the current rate of pay and length of service upon retirement or termination of employment for reasons other
than dismissal for cause. In addition to the above plans, the Company and certain consolidated subsidiaries have tax qualified
noncontributory pension plans. The liability under these plans is funded by contributions to trusted pension funds.
Under the Accounting Standards for Retirement and Severance Benefits, provisions have been made in the accompanying
consolidated financial statements based on the present value of the projected future retirement and severance benefits attributable
to employee services rendered by the end of the year, less amounts funded under noncontributory pension plans.
The funded status of the pension plans at March 31, 2007 and 2006 is outlined as follows:
Thousands of
U.S. dollars
Millions of yen
Projected benefit obligation
2007
2006
¥(24,352)
¥(24,478)
Plan assets at fair value
Funded status
6,662
6,299
56,434
(17,690)
(18,179)
(149,852)
1,712
1,710
14,502
152
169
1,288
(15,826)
(16,300)
(134,062)
50
—
423
¥(15,876)
¥(16,300)
$(134,485)
Unrecognized actuarial loss
Unrecognized prior service cost
Net amount recognized in the consolidated balance sheets
Prepaid pension cost
Liabilities for retirement and severance benefits
Net periodic pension cost for the years ended March 31, 2007 and 2006 consisted of the following components:
Thousands of
U.S. dollars
Millions of yen
32
Service cost
2007
$(206,286)
2007
2006
¥1,156
¥1,176
2007
$ 9,792
Interest cost
557
558
4,718
Expected return on plan assets
(149)
(127)
(1,262)
Amortization of unrecognized actuarial loss
165
202
1,398
17
17
144
¥1,746
¥1,826
$14,790
Amortization of unrecognized prior service cost
Net periodic pension cost
Significant assumptions of pension plans used to determine these amounts in fiscal 2007 and 2006 are as follows:
2007
2006
Straight-line
Straight-line
Discount rate
2.5%
2.5%
Expected rate of return on plan assets
2.5%
2.5%
15 years
15 years
15 years
15 years
Periodic allocation method for projected benefit
Period for amortization of unrecognized actuarial loss
Period for amortization of unrecognized prior service cost
Directors and corporate auditors are not covered by the plans described above. For such persons, the Company and certain
consolidated subsidiaries have defined benefit pension plans. Under the plans, directors and corporate auditors are entitled to
lump-sum payments based on the current rate of pay and length of service when they leave the Company. The plans are not
funded; however, provision has been made in the accompanying consolidated financial statements for the vested benefits to which
directors and corporate auditors are entitled if they were to retire or sever immediately at the balance sheet dates. As of March 31,
2007 and 2006, the liability for retirement and severance benefits related to these plans was ¥1,020 million ($8,640 thousand) and
¥935 million, respectively.
6. Common Stock
On May 1, 2006, a new corporation law (the “Corporation Law”) became effective, which reformed and replaced the Commercial
Code of Japan with various revisions that would, for the most part, be applicable to events or transactions which occur on or after
May 1, 2006 and for the fiscal years ending on or after May 1, 2006. Under the Corporation Law, the entire amount of the issue
price of shares is required to be designated as stated common stock account although a company in Japan may, by resolution of its
Board of Directors, account for an amount not exceeding 50% of the issue price of new shares as additional paid-in capital.
7. Legal Reserve and Cash Dividends
The Corporation Law provides that an amount equal to 10% of distributions from retained earnings paid by the Company and its
Japanese subsidiaries be appropriated as a legal reserve. No further appropriations are required when the total amount of the
additional paid-in capital and the legal reserve equals 25% of their respective stated capital. The Corporation Law also provides that
additional paid-in capital and legal reserve are available for appropriations by the resolution of the stockholders. Balances of the
legal reserve are included in retained earnings in the accompanying consolidated balance sheets.
Cash dividends charged to retained earnings for the years ended March 31, 2007 and 2006 represent dividends paid out
during those years. The amount available for dividends is based on the amount recorded in the Company’s non-consolidated
books of account in accordance with the Corporation Law.
Dividends paid during the year ended March 31, 2007 which was approved by the general meeting of stockholders held on
June 28, 2006 are as follows:
(a) Total dividends
(b) Cash dividends per common share
(c) Record date
(d) Effective date
¥704 million ($5,963 thousand)
¥700 ($5.93)
March 31, 2006
June 29, 2006
Dividends paid during the year ended March 31, 2007 which was approved by the Board of Directors held on November 16,
2006 are as follows:
(a) Total dividends
(b) Cash dividends per common share
(c) Record date
(d) Effective date
¥704 million ($5,963 thousand)
¥700 ($5.93)
September 30, 2006
December 11, 2006
Dividends to be paid after the balance sheet date but the record date for the payment belongs to the year ended March 31,
2007 which was approved by the general meeting of stockholders held on June 27, 2007 are as follows:
33
(a) Total dividends
¥1,308 million ($11,080 thousand)
(b) Dividend source
Retained earnings
(c) Cash dividends per common share
¥1,300 ($11.01)
(d) Record date
March 31, 2007
(e) Effective date
June 28, 2007
8. Per Share Information
(a) Net Income per Share
Basic net income per share, and reconciliation of the numbers and the amounts used in the basic net income per share
computations for the years ended March 31, 2007 and 2006 are as follows:
Yen
Basic net income per share
U.S. dollars
2007
2006
¥10,242.19
¥9,225.56
2007
Thousands of
U.S. dollars
Millions of yen
Net income
$86.76
2007
2006
¥10,304
¥9,467
$87,285
—
(186)
—
¥10,304
¥9,281
$87,285
2007
Net income not applicable to common stockholders:
Directors’ and corporate auditors’ bonuses
Net income applicable to common stockholders
Number of shares
2007
2006
1,006,000
1,006,000
Weighted average number of shares outstanding
on which basic net income per share is calculated
(b) Net Assets per Share
Net assets per share, and reconciliation of the numbers and the amounts used in the net assets per share computations at March
31, 2007 are as follows:
Net assets per share
Total net assets
Yen
U.S. dollars
¥245,677.73
$2,081.13
Millions of
yen
Thousands of
U.S. dollars
¥249,444
$2,113,037
Amount deducted from total net assets:
Minority interests
Net assets applicable to common stockholders
(2,292)
(19,416)
¥247,152
$2,093,621
Number of shares
Number of shares outstanding at the end of year
on which net assets per share is calculated
1,006,000
9. Commitments and Contingencies
At March 31, 2007, the Company has guaranteed ¥2,339 million ($19,814 thousand) of employee mortgage loans to financial
institutions, and ¥1,279 million ($10,834 thousand) of third parties loans to financial institutions.
10. Income Taxes
The Company and its consolidated subsidiaries are subject to a number of taxes based on income. The aggregate normal tax rates
for domestic companies were approximately 40.7% in 2007 and 2006. Foreign consolidated subsidiaries are subject to income
taxes of the countries in which they are incorporated.
34
Reconciliation between the normal income tax rate and the effective income tax rate as a percentage of income before income
taxes and minority interests for the years ended March 31, 2007 and 2006 is as follows:
2006
2007
Normal income tax rate
40.7%
40.7%
Expenses not deductible for tax purposes
3.9
2.4
0.6
1.6
Income not credited for tax purposes
(0.9)
(0.6)
Devaluation of investments in affiliates
(17.9)
—
—
(0.8)
0.7
0.1
27.1%
43.4%
Tax credit for information technology investment
Other
Effective income tax rate
The tax effects of temporary differences that give rise to significant portions of the deferred tax assets and liabilities as of March
31, 2007 and 2006 are presented below:
Thousands of
U.S. dollars
Millions of yen
2007
2006
¥ 1,223
¥1,190
$10,360
51
416
432
6,401
6,573
54,223
431
552
3,651
1,222
1,169
10,352
417
381
3,532
2007
Total gross deferred tax assets:
Accrued bonuses
Accrued business tax
Liabilities for retirement and severance benefits - employees
Inventories
Amortization of broadcasting rights fees
Liabilities for retirement and severance benefits – directors and corporate auditors
Other
1,042
1,372
8,827
10,787
11,653
91,377
(8,087)
(11,115)
(68,505)
Total gross deferred tax liabilities:
Net unrealized gain on other securities
Deferred profit on sale of property
Net deferred tax assets (liabilities)
(991)
(1,019)
(8,395)
(9,078)
(12,134)
(76,900)
¥ 1,709
¥ (481)
$14,477
11. Selling, General and Administrative Expenses
Significant components of selling, general and administrative expenses for the years ended March 31, 2007 and 2006 are as
follows:
Thousands of
U.S. dollars
Millions of yen
Salaries and bonuses
Agency commissions
Advertising expense
2007
2006
¥ 9,876
¥ 9,990
2007
$ 83,659
38,357
38,699
324,922
2,276
2,187
19,280
12. Balances and Transactions with Related Party
The Company acquired 14,000,000 shares of TOEI COMPANY, LTD. by subscribing to a private placement of treasury shares for an
aggregate purchase price of ¥9,170 million ($77,679 thousand) at ¥655 ($5.55) per share for the year ended March 31, 2007.
At March 31, 2007, the Company owns 11.76% equity in TOEI COMPANY, LTD. and 17.44% of the Company’s equity is
directly and indirectly owned by TOEI COMPANY, LTD.
13. Supplementary Cash Flow Information
Reconciliation between “Cash” in the accompanying consolidated balance sheets and “Cash and cash equivalents” in the
accompanying consolidated statements of cash flows as of March 31, 2007 and 2006 is as follows:
Thousands of
U.S. dollars
Millions of yen
Cash
2007
2006
¥16,215
¥27,972
2007
$137,357
Time deposits with maturities of over three months when acquired
(5,727)
(23)
(48,514)
Short-term investments with maturities of three months or less when acquired
36,992
26,004
313,359
¥47,480
¥53,953
$402,202
Cash and cash equivalents
14. Segment Information
35
Industry segment, geographic segment and overseas sales of the Company and its consolidated subsidiaries for the years ended
March 31, 2007 and 2006 is summarized as follows:
(a) Industry Segment Information
The Company and its subsidiaries’ major business categories are TV broadcasting business, music publication business and other
businesses.
Millions of yen
2007
TV
broadcasting
Sales to outside customers
Inter-segment sales
Operating expenses
¥219,410
Music
publication
¥9,195
Other
businesses
Total
¥22,520
¥251,125
Elimination
/ corporate
¥
—
Consolidated
¥251,125
2,028
154
6,636
8,818
(8,818)
—
221,438
9,349
29,156
259,943
(8,818)
251,125
211,020
7,459
27,684
246,163
Operating income
¥ 10,418
¥1,890
¥ 1,472
¥ 13,780
¥
(8,716)
237,447
(102)
¥ 13,678
Assets
¥153,376
7,450
4,373
¥9,647
45
40
¥31,687
888
257
¥194,710
8,383
4,670
¥119,756
—
—
¥314,466
8,383
4,670
Millions of yen
2006
Inter-segment sales
Operating expenses
TV
broadcasting
Music
publication
Other
businesses
Total
¥218,813
¥10,759
¥19,812
¥249,384
Elimination
/ corporate
¥
—
Consolidated
¥249,384
2,094
180
6,044
8,318
(8,318)
—
220,907
10,939
25,856
257,702
(8,318)
249,384
207,995
7,675
24,854
240,524
(8,216)
232,308
Operating income
¥ 12,912
¥ 3,264
¥ 1,002
¥ 17,178
¥
(102)
¥ 17,076
Assets
¥157,157
7,593
4,727
¥ 9,851
49
35
¥32,162
918
280
¥199,170
8,560
5,042
¥116,910
—
—
¥316,080
8,560
5,042
2007
TV
broadcasting
Music
publication
Other
businesses
$1,858,619
$77,891
$190,767
$2,127,277
17,180
1,304
56,213
1,875,799
79,195
1,787,548
63,185
Inter-segment sales
Operating expenses
Elimination
/ corporate
Total
$
Consolidated
—
$2,127,277
74,697
(74,697)
—
246,980
2,201,974
(74,697)
2,127,277
234,511
2,085,244
(73,833)
2,011,411
Operating income
$
88,251
$16,010
$ 12,469
$ 116,730
$
(864)
$ 115,866
Assets
$1,299,246
63,109
$81,720
381
$268,420
7,522
$1,649,386
71,012
$1,014,451
—
$2,663,837
71,012
37,044
339
2,177
39,560
—
39,560
Corporate assets of ¥128,082 million ($1,084,981 thousand) and ¥124,749 million as of March 31, 2007 and 2006 in the
Elimination / corporate line consist primarily of surplus funds (cash and deposits, and securities), long-term investments (investment
securities) and assets relating to the administrative operations.
(b) Geographic Segment Information
Both domestic sales and assets located in Japan are over 90% of those for all segments for the years ended March 31, 2007 and
2006.
(c) Overseas Sales
Overseas sales, which include export sales of the Company and its domestic subsidiaries, are less than 10% of consolidated sales
for the years ended March 31, 2007 and 2006.
15. Lease Information
36
(a) Finance Leases
Finance leases other than those that are deemed to transfer the ownership of the leased assets to lessees are generally accounted
for by the method that is applicable to ordinary operating leases under accounting principles generally accepted in Japan.
Certain key information about such lease contracts of the Company and its consolidated subsidiaries for the years ended
March 31, 2007 and 2006 are as follows:
(1) Lessee
( i ) Acquisition cost, accumulated depreciation and net carrying amount of leased assets, if they had been capitalized:
Millions of yen
2006
2007
Machinery and
vehicles
Acquisition cost
Accumulated depreciation
Net carrying amount
¥9,098
Others
¥1,442
Total
¥10,540
Machinery and
vehicles
¥1,011
Others
¥2,021
Total
¥3,032
6,886
786
7,672
508
1,105
1,613
¥2,212
¥ 656
¥ 2,868
¥ 503
¥ 916
¥1,419
2007
Acquisition cost
Net carrying amount
Machinery and
vehicles
Others
Total
$77,069
$12,215
$89,284
58,331
6,658
64,989
$18,738
$ 5,557
$24,295
( ii ) Lease expense and future minimum lease payments including interest expense:
Thousands of
U.S. dollars
Millions of yen
Lease expense
2007
2006
2007
¥1,636
¥ 656
$13,859
¥1,450
¥ 526
$12,283
1,418
893
12,012
¥2,868
¥1,419
$24,295
Future minimum lease payments:
Within one year
Thereafter
(2) Lessor
( i ) Acquisition cost, accumulated depreciation and net book value of leasing assets:
Millions of yen
2006
2007
Acquisition cost
Net carrying amount
Machinery and
vehicles
Others
¥73
¥126
Total
Machinery and
vehicles
Others
Total
¥199
¥116
¥129
¥245
59
41
100
90
25
115
¥14
¥ 85
¥ 99
¥ 26
¥104
¥130
2007
Machinery and
vehicles
Acquisition cost
Net carrying amount
$619
Others
$1,067
Total
$1,686
500
347
847
$119
$ 720
$ 839
( ii ) Lease income, depreciation and future minimum lease payments including interest income:
Thousands of
U.S. dollars
Millions of yen
Lease income
Depreciation
2007
2006
¥ 60
¥ 66
$508
25
26
212
¥ 47
¥ 60
$398
54
101
458
¥101
¥161
$856
2007
Within one year
Thereafter
(b) Operating Leases
Future minimum lease payments required under noncancellable operating leases as of March 31, 2007 and 2006, are summarized
as follows:
Millions of yen
Thousands of
U.S. dollars
2007
2006
¥1,785
¥1,784
1,784
3,569
15,112
¥3,569
¥5,353
$30,233
2007
Within one year
Thereafter
16. Subsequent Events
On May 18, 2007, the Company acquired shares of Toei Animation Co., Ltd., with the aim of strengthening content production
capability. Toei Animation Co., Ltd. will be accounted for by the equity method.
(a) Number of shares held before acquisition
2,000 thousand shares (14.29% of total shares issued)
(b) Number of shares acquired
110 thousand shares
(c) Number of shares held after acquisition
2,110 thousand shares (15.07% of total shares issued)
$15,121
37
Independent Auditors’ Report
To the Board of Directors of
TV Asahi Corporation:
We have audited the accompanying consolidated balance sheets of TV Asahi Corporation and consolidated subsidiaries as of
March 31, 2007 and 2006, and related consolidated statements of income, changes in net assets and cash flows for the years
then ended, all expressed in Japanese yen. These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements based on our audits.
We conducted our audits in accordance with auditing standards generally accepted in Japan. Those standards require that we
plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles used and significant estimates made by management,
as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our
opinion.
In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position
38
of TV Asahi Corporation and consolidated subsidiaries as of March 31, 2007 and 2006, and the results of their operations and
their cash flows for the years then ended in conformity with accounting principles generally accepted in Japan.
The accompanying consolidated financial statements as of and for the year ended March 31, 2007 have been translated into
United States dollars solely for the convenience of the reader. We have recomputed the translation and, in our opinion, the
consolidated financial statements expressed in yen have been translated into United States dollars on the basis described in
Note 2 to the consolidated financial statements.
Toyo Horwath
Tokyo, Japan
June 27, 2007
TV Asahi Network
1
2
Domestic Network
6
8
U TV Asahi Corporation
1 HTB
U
2 ABA
U
3 IAT U
4 KHB
U
5 AAB
U
6 YTS
U
7 KFB
U
8 UX
U
9 abn
U
10 SATV
U
11 HAB
U
12 FBC
U
13 nagoyaTV
U
14 ABC
U
15 HOME U
16 yab
U
17 KSB
U
18 eat
U
3
5
11
12
Hokkaido Television Broadcasting Co., Ltd.
Asahi Broadcasting Aomori Co., Ltd.
Iwate Asahi Television Co., Ltd.
16
19
Higashinippon Broadcasting Co., Ltd.
14
15
13
4
7
9
TV Asahi
10
17
18
20 21 22
Akita Asahi Broadcasting Co., Ltd.
24
Yamagata Television System Co., Ltd.
23
Fukushima Broadcasting Co., Ltd.
The Niigata Television Network 21, Inc.
Asahi Broadcasting Nagano Co., Ltd.
25
Shizuoka Asahi Television Co., Ltd.
Hokuriku Asahi Broadcasting Co., Ltd.
19 KBC
U
20 NCC
U
21 KAB
U
22 OAB
U
23 UMK
U
24 KKB
U
25 QAB
U
Fukui Broadcasting Corporation
Nagoya Broadcasting Network
Asahi Broadcasting Corporation
Hiroshima Home Television Co., Ltd.
Yamaguchi Asahi Broadcasting Co., Ltd.
Setonaikai Broadcasting Co., Ltd.
Ehime Asahi Television Co., Ltd.
International Network
Bureaus
Nagasaki Culture Telecasting Corporation
Kumamoto Asahi Broadcasting Co., Ltd.
Oita Asahi Broadcasting Co., Ltd.
Miyazaki Telecasting Co., Ltd.
Kagoshima Broadcasting Corporation
Ryukyu Asahi Broadcasting Corporation
39
4
5
7
10 12
13
11
6
8
9
America
1 New York (TV ASAHI America’s bureau)
U
2 Washington D.C. (TV ASAHI America’s bureau)
U
3 Los Angeles (TV ASAHI America’s bureau)
U
Europe/Africa
4 London
U
5 Moscow
U
6 Cairo
U
7 Paris (ABC’s bureau)
U
Asia/Oceania
8 Bangkok
U
9 Manila
U
10 China General (Beijing)
U
11 Taipei (ABC’s bureau)
U
12 Seoul
U
13 Shanghai (ABC’s bureau)
U
ABC: Asahi Broadcasting Corporation
Cooperation
America
CNNUSA
Europe/Africa
TF1France
RTLGermany
TVP Poland
Asia/Oceania
CCTVChina
Dalian TV StationChina
CTVTaiwan
ETTV Taiwan
GMA Philippines
RTMMalaysia
CH7Australia
3
2
1
Principal Subsidiaries and Affiliates
TV Broadcasting
Businesses Related to Program
Production
Consolidated Subsidiaries
Logical Solution & D Inc.
100.00 (100.00)
Other Businesses
Take Systems Co., Ltd.
85.00 (35.83)
TV Shopping Business
Consolidated Subsidiary
TV Asahi Productions Co., Ltd.
40.00
TV Asahi Living Co., Ltd.
100.00
TV Asahi Create Co., Ltd.
87.00 (37.83)
Businesses Related to Broadcasting
Facilities
Trust Network Inc.
90.00 (45.00)
40
Video Pack Nippon Company Ltd.
42.40
Music Publication
Housougijyutsusha Co., Ltd.
100.0 (52.50)
TV ASAHI America, Inc.
100.00
TV ASAHI Music Co., Ltd.
100.00
Affiliates — equity method applied
Affiliate — equity method applied
Japan Cable Television, Ltd.
41.74 (8.44)
BS Asahi Sounds, Ltd.
40.00 (20.00)
Television Asahi Service Co., Ltd.
70.00 (21.25)
Announcer Training School
TV Asahi ASK Co., Ltd.
100.00
Facilities Administration Business
TV Asahi BEST Co., Ltd.
100.00
Flex Co., Ltd.
25.67
Bunkakobo, Inc.
20.00
Media Mix Japan Co., Ltd.
23.56 (3.56)
JCTV-HQ
0.00 [100.00]
BS/CS Digital Broadcasting
Affiliates — equity method applied
Asahi Satellite Broadcasting Limited
29.96 (0.50)
CS One Ten, Ltd.
33.00
Data Broadcasting
Consolidated Subsidiaries
TV Asahi Data Vision Corporation
100.00
Digital Cast International Limited
48.26 (10.00)
Note: Figure under each company name shows the
equity held by the Company, which equals the total of direct and indirect holdings. Figures in ( ) are indirect holdings.
The figure in [ ] corresponds to the holding held by an affiliate. JCTV-HQ is 100% held by
Japan Cable Television, Ltd. and is counted as an affiliate company of TV Asahi.
TV Asahi at a Glance
Board of Directors
Investor Information
As of June 27, 2007
As of March 31, 2007
TV broadcasting, the mainstay segment of the TV Asahi Group, comprises operations
related to the production and transmission of television programs aired on the TV Asahi
network. These activities are undertaken primarily by TV Asahi and subsidiary TV Asahi
Productions Co., Ltd., and account for approximately 90% of consolidated net sales.
TV Asahi has earned high praise from viewers for news and information programs,
such as Hodo Station—the network’s most recognized weeknight news show—and
TV Broadcasting
Business
Takeshi’s TV Tackle, in which Takeshi Kitano, a world-renowned director, leads weekly
discussions on political, economic and social topics. TV Asahi’s entertainment shows
and drama series also capture strong ratings.
Sports programming is another important genre. TV Asahi delivers major events to
which it has exclusive broadcasting rights, such as the 2007 FINA World Championships Melbourne and the 2006 FINA Synchronised Swimming World Cup in the past
year. The Company also has an exclusive contract with the Asian Football Confederation (AFC).
In the animation genre, TV Asahi has continued to focus on programs that appeal
to overseas audiences, such as Doraemon and Crayon Shin-chan.
TV Asahi Music Co., Ltd., the core subsidiary of the Company’s music publication
Music Publication
Business
business, administers copyrights for music compositions, manages artists and scouts
for promising new talent through tie-ups with television programs.
TV Asahi Music is also the exclusive agent for a number of artists particularly well
liked by young adults. HY, KETSUMEISHI, Shonan no Kaze and Sasuke are artists
who continue to grow in popularity.
Other Businesses
TV Asahi is involved in activities such as special events production, TV shopping, video
and DVD sales, and motion picture investment, as well as content distribution on the
Internet and to mobile phones.
In the special events business, TV Asahi sponsors Summer Sonic and Fuji Rock
Festival, concerts that have become summer traditions.
In the TV shopping business, the Company has marketed an array of hit products and
continues to work with manufacturers to develop new hit products.
In video and DVD sales, a steady stream of new releases, particularly series of popular
TV dramas and entertainment shows, has contributed to sales.
In motion picture investment, TRICK The Movie 2, based on the popular drama series
TRICK, and samurai epic Love and Honor, starring popular Japanese entertainer, Takuya
Kimura, and directed by Yoji Yamada, drew large audiences.
In the Internet and mobile content distribution business, “Tele Asa com·plete!,”
a subscription-based information site for mobile phone users, continues to deliver
program-related content.
Board of Directors
Stock Information
Corporate Data
Chairman
Michisada Hirose
Authorized Number of Shares
3,000,000
Corporate Name
President
Masao Kimiwada *
Issued Number of Shares
1,006,000
Abbreviation
TV Asahi
Vice-President
Hiroshi Hayakawa *
Number of Stockholders
37,980
Executive Directors
Kenji Kazama
Ikuo Kamiyama
Hidekazu Kitamura
Hiroaki Takada
Keiji Takano
Toshio Fukuda
Number of Shares Held by Foreign
Investors
152,003 (15.11%)
Head Office
9-1 Roppongi 6-chome, Minato-ku,
Tokyo 106-8001, Japan
Tel. +81-3-6406-1111
http://www.company.tv-asahi.co.jp/e/
Members of the Board
Toru Takeda
Mutsuko Horikoshi
Takahiro Otsuka
Seishi Fukuda
Kojiro Watanabe
Michio Uematsu
Haruki Kitazawa
Kotaro Akiyama
Tsuyoshi Okada
Yoshitoshi Kitajima
Mitsuru Gondo
Yoshio Nishimura
Tetsuzo Hori
Standing Corporate Auditors
Sachio Arikura
Yasuharu Murase
Corporate Auditors
Koichi Kobayashi
Sawako Noma
Takahisa Hamamoto
* Representative Directors
Listing
Tokyo Stock Exchange
Date of Establishment
November 1, 1957
Stockholder Information
Date of Service Start
February 1, 1959
Fiscal Year-End
March 31
Paid-in Capital
¥36,642,800,000
General Meeting of Stockholders
Number of Employees
1,218
41
June
Underwriter
Transfer Agent
The Sumitomo Trust & Banking Co.,
Ltd.
Daiwa Securities SMBC Co. Ltd.
Sub-Underwriter
Nomura Securities Co., Ltd.
Nikko Citigroup Limited
Major Stockholders
Name
Shares
Percent of
voting rights
Asahi Shimbun Publishing Company
340,495
33.85
Toei Co., Ltd.
161,842
16.09
Dai Nippon Printing Co., Ltd.
40,300
4.01
32,147
3.20
Mellon Bank Treaty Clients Omnibus
29,876
2.97
Satellite Channels Incorporated
20,854
2.07
The Master Trust Bank of Japan, Ltd.(Trust Account)
16,493
1.64
State Street Bank & Trust Company 505025
16,422
1.63
CBNY-UMB Fund
15,304
1.52
Kodansha Ltd.
13,640
1.36

TV Asahi Corporation

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