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                      | HITACHI HOME | UP | SEARCH | HITACHI

                      News Release

                      April 24, 1998

                      Computation of Extraordinary Losses for Fiscal Year Ended March 1998 (Unconsolidated basis)

                      Hitachi, Ltd. plans to take the following extraordinary loss items in the fiscal year ended March 31, 1998 unconsolidated. Approximately 70.5 billion yen for restructuring of semiconductor operations; approximately 43.8 billion yen for amortization of prior service cost portions of Employees Pension Fund (EPF) plans; and approximately 3.2 billion yen by a write-down of investment in several subsidiaries.

                      Since the Company will also realize an extraordinary gain of approximately 117.6 billion yen resulting from sales of securities, the extraordinary items are expected to have little effect on income before income taxes in the said fiscal period.

                      Details of extraordinary losses

                      1. Extraordinary loss for restructuring of semiconductor operations
                        (approximately 70.5 billion yen)

                        In response to the unexpectedly sharp fall in the prices of semiconductor memories, the Company is implementing a restructuring of its semiconductor operations. This involves a large expenditure that is being recognized as an extraordinary loss item. Specific details are as follows.

                        • A loss of approximately 34.2 billion yen arising from the dissolution of TwinStar Semiconductor Incorporated, a memory production affiliate located in the U.S.
                        • An additional depreciation of approximately 23.1 billion yen on semiconductor memory production equipment based on a change in accounting estimates.
                        • Approximately 13.0 billion yen in a one-time recognition of minimum lease payments for semiconductor memory production equipment used on a capital lease contract basis.

                      2. Amortization of prior service cost portion of EPF plans
                        (approximately 43.8 billion yen)

                        In line with the June 27, 1996 directive on operation of EPF plans issued by the Pension Bureau of the Ministry of Health and Welfare, the Company changed its funding policy from a system under which the prior service costs of EPF plans were amortized using a 20- year fixed installment method, to a 27% fixed rate method. The expenditure of 43.8 billion yen incurred by the changeover is being recognized as an extraordinary loss.

                      3. Write-down of investment in several subsidiaries
                        (approximately 3.2 billion yen)

                        Write-down of investment in several subsidiaries experiencing stagnant business conditions is being recognized as an extraordinary loss.


                      WRITTEN BY Secretary's Office
                      All Rights Reserved, Copyright (C) 1998, Hitachi, Ltd.

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