TDK CORPORATION Annual Repor t 2003 Consolidated Statements of Cash Flows TDK Corporation and Subsidiaries years ended March 31, 2003, 2002 and 2001 U.S. Dollars (Thousands) (Note 2) Yen (Millions) 2003 Cash flows from operating activities: Net income (loss) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Adjustments to reconcile net income (loss) to net cash provided by operating activities: Depreciation and amortization . . . . . . . . . . . . . . . . . . Loss on disposal of property and equipment . . . . . . . . Deferred income taxes . . . . . . . . . . . . . . . . . . . . . . . . Loss (gain) on securities . . . . . . . . . . . . . . . . . . . . . . Contribution of cash and cash equivalents to pension trust . . . . . . . . . . . . . . . . . . . . . . . . . . . . Changes in assets and liabilities: Decrease (increase) in trade receivables . . . . . . . . . . . Decrease (increase) in inventories . . . . . . . . . . . . . . . Increase (decrease) in trade payables . . . . . . . . . . . . . Increase (decrease) in income taxes payables, net . . . Other – net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2002 2001 2003 ¥ 12,019 (25,771) 43,983 57,789 4,845 4,301 3,298 61,920 6,436 (13,797) 207 67,973 5,144 (10,986) (13,450) 481,575 40,375 35,842 27,483 (15,315) – – 100,158 18,517 28,776 (14,806) (25,223) 5,245 22,365 (23,607) (18,969) 4,642 5,817 (18,800) 118,975 55,758 18,875 9,409 104,358 41,504 67,597 869,650 Cash flows from investing activities: Capital expenditures . . . . . . . . . . . . . . . . . . . . . . . . . . . Proceeds from sales and maturities of investments . . . . Payment for purchase of investments . . . . . . . . . . . . . . Other – net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (41,451) 1,511 (7,306) 601 (58,777) 323 (3,116) 3,667 (99,452) 6,253 (692) 1,353 (345,425) 12,592 (60,883) 5,008 Net cash used in investing activities . . . . . . . . . . . . (46,645) (57,903) (92,538) (388,708) Cash flows from financing activities: Proceeds from long-term debt . . . . . . . . . . . . . . . . . . . . Repayment of long-term debt . . . . . . . . . . . . . . . . . . . . . Increase (decrease) in short-term debt, net . . . . . . . . . . Payment to acquire treasury stock . . . . . . . . . . . . . . . . . Dividends paid . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 211 (646) (254) (1,263) (5,973) 46 (777) (3,568) (926) (7,977) 614 (1,536) 2,761 (2,666) (7,987) 1,758 (5,383) (2,117) (10,525) (49,775) Net cash used in financing activities . . . . . . . . . . . . (7,925) (13,202) (8,814) (66,042) Effect of exchange rate changes on cash and cash equivalents . . . . . . . . . . . . . . . . . . . . . . . . . . . (4,998) 4,445 10,153 (41,650) Net cash provided by operating activities . . . . . . . . . (2,256) 14,277 6,691 2,265 1,129 – $ Net increase (decrease) in cash and cash equivalents . . . . Cash and cash equivalents at beginning of period . . . . . . . 44,790 125,761 (25,156) 150,917 (23,602) 174,519 373,250 1,048,008 Cash and cash equivalents at end of period . . . . . . . . . . . . ¥170,551 125,761 150,917 $1,421,258 See accompanying notes to consolidated financial statements. Understanding TDK Today 43