Sony 2008 Annual Report Download - page 55

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53
contributed to operating income. An operating loss was
recorded within the Game segment. Refer to “Operating
Performance by Business Segment” below for a further
breakdown of operating income (loss) for each segment.
OTHER INCOME AND EXPENSES
For the fiscal year ended March 31, 2008, other income
increased by 54.3 billion yen, or 57.0 percent, to 149.4 billion
yen, while other expenses decreased by 7.3 billion yen, or 11.2
percent, to 57.6 billion yen, compared with the previous fiscal
year. The net amount of other income and other expenses was
net other income of 91.8 billion yen, an increase of 61.5 billion
yen, compared with the previous fiscal year.
The gain on change in interest in subsidiaries and equity
investees increased by 50.5 billion yen, or 160.4 percent
compared to the previous fiscal year, to 82.1 billion yen. This
increase is due to the recording of a gain of 81.0 billion yen for
the change in interest in subsidiaries and equity investees as
a result of the global initial public offering of shares of SFH in
connection with the listing of shares on the First Section of the
TSE in October 2007. During the fiscal year ended March 31,
2007, there was a gain on change in interest in subsidiaries and
equity investees recorded on the sale of a portion of the stock
held in StylingLife Holdings Inc.
Interest and dividends in other income of 34.3 billion yen was
recorded in the fiscal year ended March 31, 2008, an increase of
6.0 billion yen, or 21.4 percent, compared with the previous fiscal
year. For the fiscal year ended March 31, 2008, interest expense
totaling 22.9 billion yen was recorded, a decrease of 4.3 billion yen,
or 15.9 percent, compared with the previous fiscal year.
In addition, net foreign exchange income of 5.6 billion yen was
recorded in the fiscal year ended March 31, 2008, compared to
a net foreign exchange loss of 18.8 billion yen in the previous
fiscal year. Net foreign exchange income was recorded due to
the value of the yen, especially during the second through fourth
quarters of the fiscal year ended March 31, 2008, appreciating
in value against other currencies from the time that Sony entered
into foreign exchange forward contracts and foreign currency
option contracts. These contracts are entered into by Sony to
mitigate the foreign exchange rate risk to cash flows that arises
from settlements of foreign currency denominated accounts
receivable and accounts payable, as well as foreign currency
denominated transactions between consolidated subsidiaries.
Personnel-related costs in selling, general and administrative
expenses increased by 19.8 billion yen compared with the previ-
ous fiscal year mainly within the Electronics and the Pictures
segment. Advertising and publicity expenses for the fiscal year
decreased by 46.2 billion yen compared with the previous fiscal
year primarily due to decreased advertising and publicity
expenses within the Pictures segment.
Gain on sale, disposal or impairment of assets, net was 37.8
billion yen, compared with a 5.8 billion yen loss on sale, disposal
or impairment of assets, net recorded in the previous fiscal year.
The gain recorded in the fiscal year ended March 31, 2008 is
primarily from a gain on the sale of a portion of the site of Sony’s
former headquarters of 60.7 billion yen and gain on the sale of
“The Sony Center am Potsdamer Platz” in Berlin of 10.0 billion
yen. A gain on the sale of a portion of the site of Sony’s former
headquarters of 21.7 billion yen was recorded in the previous
fiscal year.
OPERATING INCOME
Operating income for the fiscal year ended March 31, 2008
increased by 302.7 billion yen, or 421.9 percent, to 374.5 billion
yen compared with the previous fiscal year. The operating
income margin increased from 0.9 percent to 4.2 percent. In
descending order by yen amount, the Electronics segment, the
Pictures segment, All Other and the Financial Services segment
8
6
4
2
0
600
450
300
150
02006 2007 2008
7.8%
7.1% 6.3%
Research and development
expenses and as a percentage
of sales
■¥Research and development
expenses
●¥Percentage of sales
* Years ended March 31
* Excluding the Financial
Services segment
(Yen in billions) (%)
Cost of sales and selling, general
and administrative (SGA) expenses
as a percentage of sales
●¥Cost of sales/sales
●¥SGA/sales
* Years ended March 31
* Excluding the Financial
Services segment
(%)
80
60
40
20
02006 2007 2008
75.9%
22.5%
76.8%
23.3%
75.6%
20.6%