News Column

Final Results

May 7, 2014

LONDON--(BUSINESS WIRE)--

This announcement is for our U.S.$5,000,000,000 Euro Medium Term Note Programme.

Consolidated Financial Results for the Year Ended March 31, 2014
[Based on accounting principles generally accepted in the United States of America ("U.S. GAAP")]
Tokyo, May 7, 2014 - Mitsui & Co., Ltd. announced its consolidated financial results for the year ended March 31, 2014.
                                 
Mitsui & Co., Ltd. and subsidiaries

(Web Site : http://www.mitsui.com/jp/en/)

 
President and Chief Executive Officer : Masami Iijima
Investor Relations Contacts : Michihiro Nose, General Manager, Investor Relations Division TEL 81-3-3285-7533
 
1. Consolidated financial results (Unaudited)
(1) Consolidated operating results information for the year ended March 31, 2014
(from April 1, 2013 to March 31, 2014)
 
                                                           
Years ended

March 31,

                     
2014     2013  
                                              %           %
Revenues                       Millions of yen   5,740,650     16.9   4,911,609    

? 6.5

Income before Income Taxes and Equity in Earnings   Millions of yen   453,732     44.5   314,098     ? 24.0
Net income attributable to Mitsui & Co., Ltd.   Millions of yen   422,161     37.1   307,926     ? 29.1
Net income attributable to Mitsui & Co., Ltd. per share, basic   Yen   231.79     168.72    
Net income attributable to Mitsui & Co., Ltd. per share, diluted   Yen   231.78         -      
Net income ratio to Mitsui & Co., Ltd. Shareholders' equity   %   12.5         10.6      
Notes:
1. Percentage figures for Revenues, Income before Income Taxes and Equity in Earnings, and Net income attributable to

Mitsui & Co., Ltd. represent changes from the previous year.

2. Equity in Earnings of Associated Companies - Net for the years ended March 31, 2014 and 2013 were ¥173,730 million

and ¥176,226 million, respectively.

3. Comprehensive Income for the years ended March 31, 2014 and 2013 were ¥549,238 million (?13.0%) and

   ¥631,260 million (69.2%) , respectively.

4. Diluted net income attributable to Mitsui & Co., Ltd. per share for the year ended March 31, 2013 is

   not disclosed as there are no dilutive potential shares.

 
(2) Consolidated financial position information
                                                         
March 31, 2014March 31, 2013
                                                         
Total assets   Millions of yen   11,001,264     10,324,581      
Total equity (net worth)   Millions of yen   3,868,066     3,440,104      
Mitsui & Co., Ltd. shareholders' equity   Millions of yen   3,586,414     3,181,819      
Mitsui & Co., Ltd. shareholders' equity ratio   %   32.6     30.8      
Mitsui & Co., Ltd. shareholders' equity per share   Yen   2,000.78     1,743.34      
 
(3) Consolidated cash flow information
                                                         
Years ended March 31,        
                                      2014       2013      
Operating activities   Millions of yen   521,524       461,430      
Investing activities   Millions of yen   (704,516)       (753,297)      
Financing activities   Millions of yen   (34,698)       221,635      
Cash and cash equivalents at the end of the year   Millions of yen   1,225,079       1,425,174      
 
2. Dividend information
                                                       
                      Years ended March 31,     Year ending March 31, 2015 (Forecast)
                                  2014       2013        
Interim dividend per share         Yen 25         22         32
Year-end dividend per share         Yen 34         21         32
Annual dividend per share         Yen 59         43         64
Annual dividend (total)           Millions of yen 106,590         78,493          
Consolidated dividend payout ratio     % 25.5         25.5         30.2
Note: Regarding our dividend policy, please refer to "(3) Profit Distribution Policy" on page 21.
       
 
3. Forecast of consolidated operating results for the year ending March 31, 2015 [IFRS] (from April 1, 2014 to March 31, 2015)
                                                         
Year ending

March 31, 2015

                                                         
Net income attributable to Mitsui & Co., Ltd.           Millions of yen 380,000          
Net income attributable to Mitsui & Co., Ltd. per share, basic   Yen 211.99          
Note: Mitsui & Co., Ltd. ("Mitsui") will adopt International Financial Reporting Standards ("IFRS") for its annual securities report under the Financial Instruments and Exchange Act from the year ended March 31, 2014.

Therefore, Mitsui has made the forecasts for the year ending March 31, 2015 based on IFRS and has not made forecasts based on U.S. GAAP.

 
 
4. Others
(1) Increase/decrease of important subsidiaries during the period : Yes
New : 1 company (Mizha Energia ParticipaÇÕes S.A.)
 
(2) Number of shares :
                                                         
                                  March 31, 2014March 31, 2013
                                                         
Number of shares of common stock issued, including treasury stock 1,829,153,527 1,829,153,527
Number of shares of treasury stock             36,641,439 4,027,206
                                     
                                  Year ended March 31, 2014 Year ended March 31, 2013
                                                         
Average number of shares of common stock outstanding   1,821,338,844 1,825,019,130
 
 
Disclosure Regarding Annual Audit Procedures:
This report was prepared based on U.S. GAAP except for "2. Management Policies" on p.18.
However,the audit procedures for the consolidated financial statements have not been completed as of the date of disclosure of this earnings report.
 
A Cautionary Note on Forward-Looking Statements:

This report contains forward-looking statements including those concerning future performance of Mitsui & Co., Ltd. ("Mitsui"), and those statements are based on Mitsui's current assumptions, expectations and beliefs in light of the information currently possessed by it. Various factors may cause Mitsui's actual results to be materially different from any future performance expressed or implied by these forward-looking statements.

Therefore, these statements do not constitute a guarantee by Mitsui that such future performance will be realized.
For key assumptions on which the statements concerning future performance are based, please refer to (2) Forecasts for the Year Ending March 31, 2015" on p.18. For cautionary notes with respect to forward-looking statements, please refer to the "Notice" section on p.21.
 
Supplementary materials and IR meeting on financial results:
Supplementary materials on financial results can be found on our web site.
We will hold IR meetings for analysts and institutional investors on financial results on May 7, 2014, and on new medium-term management plan on May 8, 2014.
Contents of the meeting (English and Japanese) will be posted on our web site immediately after the meeting.
 
Table of Contents              
 
1. Qualitative Information
(1) Operating Environment 2
(2) Results of Operations 2
(3) Financial Condition and Cash Flows 14
 
2. Management Policies
(1) New Medium-term Management Plan 18
(2) Forecasts for the Year Ending March 31, 2015 18
(3) Profit Distribution Policy 21
 
3. Other Information 21
 
4. Consolidated Financial Statements
(1) Consolidated Balance Sheets 23
(2) Statements of Consolidated Income and Comprehensive Income 25
(3) Statements of Changes in Consolidated Equity 26
(4) Statements of Consolidated Cash Flow 28
(5) Assumption for Going Concern 29
(6) Basis of Consolidated Financial Statements 29
(7) Notes to Consolidated Financial Statements 30
 
 


1. Qualitative Information

Mitsui & Co., Ltd. will adopt International Financial Reporting Standards ("IFRS") for its annual securities report under the Financial Instruments and Exchange Act from the year ended March 31, 2014. This earnings report was prepared based on the U.S. GAAP except “2. Management Policies.”

As of the date of disclosure of this earnings report, the audit procedures for consolidated financial statements have not been completed.

(1) Operating Environment

During the year ended March 31, 2014, the global economy continued to recover, albeit moderately, amid drastic monetary easing on the part of advanced economies. Clear differences have emerged, however, in the economic circumstances of advanced and emerging nations. The extent of recovery varies between countries and regions.

The U.S. economy was hampered in the second half of the year by scale back of the third round of quantitative easing (QE3) and a severe cold snap, but maintained solid growth, underpinned by steady improvement in employment, progress made in the ongoing adjustment in the housing market, as well as the wealth effect generated by higher stock prices and housing prices, and healthy corporate earnings.

In Japan, too, the economy benefited from improved corporate earnings and also higher personal consumption, as bold monetary easing under Abenomics drove the yen lower and pushed share prices higher. Growth in public works spending also contributed to economic recovery.

In Europe, the employment environment remained harsh and economic growth was restricted, on account of curtailed budgets aimed at resolving the region’s debt crisis. However, belt-tightening has now been scaled back, allowing the economy to bottom out.

Among emerging nations, some found themselves in the unenviable position of having to take tight monetary policy even as their economies faltered because of the U.S. decision to scale back QE3, prompting reallocation of capital from emerging markets back toward the U.S., and emerging-currency depreciation. Emerging economies also were negatively impacted by signs of structural change in the U.S. trade, with the “shale revolution” contributing to reduced energy import volumes and the return of manufacturers to the U.S, effectively reducing the benefits conferred by a strong U.S. economy. While the Chinese economy was affected to some extent by structural reforms aimed at curbing excessive investment and lending, and by the emerging shadow-banking threat, it maintained a certain degree of growth underpinned by flexible fiscal spending.

During the period under review, the spot reference price for iron ore CFR North China (Fe 62%) showed a correlation with outlook for the Chinese economy, rising above US$140 per ton in summer then softening amid rising concern about China’s economic outlook, slumping to US$105 per ton in March. While affected to some extent by geopolitical risk, the Dubai Crude spot price remained stable at around US$100-110 per barrel.

We believe that the global economic recovery will gradually gain momentum, driven by the continued strength of the U.S. and other advanced economies. We think that Japan and Europe will continue their easy monetary policy for the time being. The U.S. has begun QE3 tapering, but it is likely to be some time yet before the next cycle of extensive interest rate hikes begins. Against this backdrop, we will steadily execute our latest medium-term management plan while paying due attention to rising geopolitical risk from Ukraine and other areas of concern, accelerated monetary tightening in the U.S., and the growth rate of Chinese economy.

(2) Results of Operations

1) Analysis of Consolidated Income Statements

Revenues

Mitsui & Co., Ltd. (“Mitsui”) and its subsidiaries (collectively “we”) recorded total revenues of ¥5,740.7 billion for the year ended March 31, 2014, an increase of ¥829.1 billion from ¥4,911.6 billion for the corresponding previous year.

Revenues from sales of products for the year ended March 31, 2014 were ¥5,216.9 billion, an increase of ¥808.8 billion from ¥4,408.1 billion for the corresponding previous year, as a result of the following:

  • The Chemicals Segment reported an increase of ¥194.6 billion mainly attributable to a recovery in trading activities of petrochemical materials.
  • The Energy Segment reported an increase of ¥177.0 billion. Petroleum trading operations recorded an increase of ¥133.2 billion due to an increase in trading volume, while oil and gas producing operations recorded an increase of ¥29.7 billion reflecting the depreciation of the Japanese yen.
  • The Mineral & Metal Resources Segment reported an increase of ¥161.5 billion. Iron ore mining operations in Australia reported an increase of ¥88.4 billion due to the depreciation of the Japanese yen and an increase in sales volume owing to increased capacity.
  • The Americas Segment reported an increase of ¥150.2 billion, attributable to the depreciation of the Japanese yen; an increase in trading volume of grain; and contribution from Cinco Pipe & Supply, LLC (United States.)

    Revenues from sales of services for the year ended March 31, 2014 were ¥415.4 billion, an increase of ¥23.3 billion from ¥392.1 billion for the corresponding previous year.

    Revenues from other sales for the year ended March 31, 2014 were ¥108.3 billion, a decline of ¥3.1 billion from ¥111.4 billion for the corresponding previous year.

    Gross Profit

    Gross profit for the year ended March 31, 2014 was ¥859.9 billion, an increase of ¥69.5 billion from ¥790.4 billion for the corresponding previous year as a result of the following:

  • The Mineral & Metal Resources Segment reported an increase of ¥32.2 billion. Iron ore mining operations in Australia reported an increase of ¥40.1 billion due to the depreciation of the Japanese yen and an increase in sales volume owing to increased capacity. Meanwhile, coal mining operations in Australia posted a decline of ¥7.7 billion reflecting the decline in coal prices.
  • The Americas Segment reported an increase of ¥11.5 billion. The depreciation of the Japanese yen as well as Cinco Pipe & Supply, LLC were the main contributors.
  • The Chemicals Segment reported an increase of ¥9.8 billion, due to the depreciation of the Japanese yen; recovery of trading activities of petrochemical materials; and strong sales of agricultural chemicals.
  • The Iron & Steel Products Segment reported an increase of ¥8.9 billion, attributable to solid sales of tubular products including line pipe.
  • The Machinery & Infrastructure Segment reported an increase of ¥8.7 billion. Automotive-related and mining and construction machinery-related businesses in South America as well as the locomotive leasing business in Europe achieved a solid performance.
  • The Innovation & Corporate Development Segment reported a decline of ¥9.2 billion. The commodity derivatives trading business at Mitsui recorded a decline in gross profit corresponding to an increase of ¥8.0 billion in the foreign exchange gains posted in other expenses-net.

    Selling, General and Administrative Expenses

    Selling, general and administrative expenses for the year ended March 31, 2014 were ¥574.7 billion, an increase of ¥53.6 billion from ¥521.1 billion for the corresponding previous year. The depreciation of the Japanese yen increased selling, general and administrative expenses of overseas subsidiaries. The table below provides a breakdown of selling, general and administrative expenses used for our internal review.

    [Table omitted]

    The table below provides selling, general and administrative expenses broken down by operating segments.

    [Table omitted]

    Provision for Doubtful Receivables

    Provision for doubtful receivables for the year ended March 31, 2014 was ¥10.0 billion, a decline of ¥4.8 billion from ¥14.8 billion for the corresponding previous year. The provisions for both periods represented aggregated reserves for individually small receivables.

    Interest Income—Net

    Interest income, net of interest expense, for the year ended March 31, 2014 was ¥2.1 billion of income, an improvement of ¥3.3 billion from ¥1.2 billion of expense for the corresponding previous year.

  • A ¥14.4 million interest income for previous years was recorded in interest income with respect to a loan to Paiton 1.
  • The deferred commitment fee related to the loan extended to the subsidiary of CorporaciÓn Nacional del Cobre de Chile ("Codelco") was recorded for the corresponding previous year.

    The following table provides the month-end average of three-month Tibor for the Japanese yen and three-month Libor for the U.S. dollar for the years ended March 31, 2014 and 2013.

    Month-end average of three-month rate (%p.a.)
          Year ended March 31,
      2013     2014
    Japanese yen 0.31 0.22
    U.S. dollar 0.37 0.25
     


    Dividend Income

    Dividend income for the year ended March 31, 2014 was ¥120.5 billion, an increase of ¥40.4 billion from ¥80.1 billion for the corresponding previous year. Dividends from six LNG projects (Abu Dhabi, Oman, Qatargas 1 and 3, Equatorial Guinea, and Sakhalin II) were ¥96.2 billion in total, an increase of ¥35.0 billion from ¥61.2 billion for the corresponding previous year, mainly due to an increase in dividends received from the Sakhalin II and the Qatargas 1 projects.

    Gain on Sales of Securities—Net

    Gain on sales of securities for the year ended March 31, 2014 was ¥80.9 billion, an increase of ¥36.0 billion from ¥44.9 billion for the corresponding previous year.

  • For the year ended March 31, 2014, a gain on the sale of shares in Mitsui Oil Co., Ltd. for ¥12.0 billion; a gain on the sale of shares in QIWI plc for ¥10.5 billion; an ¥8.3 billion gain on the sale of shares in INPEX Corporation; a ¥5.1 billion gain on the sale of shares in Brightstar Corp.; a ¥4.8 billion gain on the sale of shares in an overseas iron & steel company; a ¥4.1 billion gain on sale of shares in a port terminal company in Brazil by Multigrain Trading AG; a gain on the sale of shares in Daicel Corporation for ¥3.3 billion; a gain on the exchange of shares in Mikuni Coca-Cola Bottling Co., Ltd. for ¥3.2 billion; and a gain on the sale of shares in an overseas lifestyle-related company for ¥3.2 billion were recorded, respectively.
  • For the corresponding previous year, an ¥8.0 billion gain on the sale of shares in Mikuni Coca-Cola Bottling Co., Ltd.; a ¥6.2 billion gain on the sale of shares in INPEX Corporation; a ¥4.8 billion gain on the sale of shares in Nihon Unisys, Ltd.; a ¥4.4 billion gain on the sale of shares in LME Holdings Limited; and a ¥3.1 billion gain on the sale of shares in MED3000 Group, Inc. were recorded, respectively. Furthermore, a ¥5.5 billion gain related to equity dilution in IHH Healthcare Berhad (Malaysia) was recorded.

    Gain on securities contributed to an employee retirement benefit trust

    Gain on securities contributed to an employee retirement benefit trust for the year ended March 31, 2014 was ¥2.1 billion due to the contribution of a listed security. There was no gain on securities contribution to an employee retirement benefit trust for the corresponding previous year.

    Loss on Write-Downs of Securities

    Loss on write-downs of securities for the year ended March 31, 2014 was ¥18.9 billion, an improvement of ¥8.4 billion from ¥27.3 billion for the corresponding previous year.

  • For the year ended March 31, 2014, an impairment loss of ¥9.5 billion on preferred shares of Valepar S.A. was recorded reflecting an other-than-temporary decline related to a foreign exchange translation loss in the investment value of the current portion of preferred shares. Furthermore, an impairment loss of ¥3.3 billion on investment in an LNG project was recorded reflecting an other-than-temporary decline in the investment value.
  • For the corresponding previous year, impairment losses on listed shares of ¥4.9 billion in an iron & steel company and ¥3.0 billion in Mitsui Chemicals Inc. were recorded reflecting the decline in share prices. Meanwhile, an impairment loss of ¥4.5 billion on preferred shares of Valepar S.A. was recorded in the same manner as the year ended March 31, 2014.

    Gain (Loss) on Disposal or Sales of Property and Equipment—Net

    Gain on disposal or sales of property and equipment for the year ended March 31, 2014 was ¥15.7 billion, an increase of ¥9.5 billion from ¥6.2 billion for the corresponding previous year.

  • Mitsui E&P Middle East B.V. (Netherlands) and Mitsui E&P Australia Pty Limited (Australia) recorded a total of ¥6.2 billion gain on sales of interests in oil fields in Egypt and New Zealand, respectively. Furthermore, Bussan Real Estate Co., Ltd (Japan) recorded a ¥4.3 billion gain on sales of office buildings in Japan and MBK Real Estate LLC (United States) recorded a ¥4.3 billion gain on sale of senior living facilities.
  • For the corresponding previous year, a gain on sale of land used for logistics in Canada was recorded.

    Impairment Loss of Long-Lived Assets

    Impairment loss of long-lived assets for the year ended March 31, 2014 was ¥6.5 billion, an improvement of ¥5.8 billion from ¥12.3 billion for the corresponding previous year.

  • Mitsui Coal Holdings Pty. Ltd. (Australia) recorded an impairment loss of ¥4.5 billion on an undeveloped coal deposit for the year ended March 31, 2014.
  • For the corresponding previous year, Australian iron ore operations, which are run as joint ventures with BHP Billiton through Mitsui Iron Ore Development Pty. Ltd. and Mitsui-Itochu Iron Pty. Ltd., recorded impairment losses totaling ¥6.4 billion for the pre-commitment works for the outer harbour development at Port Hedland in Western Australia.

    Impairment Loss of Goodwill

    Impairment loss of goodwill for the year ended March 31, 2014 was ¥4.1 billion consisting of miscellaneous small impairment, and there was no impairment loss of goodwill for the corresponding previous year.

    Other Expenses (Income)—Net

    Other expenses for the year ended March 31, 2014 was ¥13.4 billion, an improvement of ¥17.5 billion from ¥30.9 billion for the corresponding previous year.

  • For the year ended March 31, 2014, exploration expenses totaled ¥20.2 billion, including those recorded at oil and gas producing businesses. Mitsui Raw Materials Development Pty. Ltd. (Australia) recorded a ¥3.6 billion foreign exchange loss related to borrowings denominated in U.S. dollars. Meanwhile, the Innovation & Corporate Development Segment recorded a foreign exchange gain of ¥14.4 billion in the commodity derivatives trading business at Mitsui, which corresponded to related revenues and gross profit in the segment.
  • For the corresponding previous year, exploration expenses totaled ¥37.4 billion, including those recorded at oil and gas producing businesses. Mitsui Oil Exploration Co., Ltd. recorded a foreign exchange translation gain of ¥9.5 billion related to foreign currency deposits. Meanwhile, Mitsui recorded foreign exchange losses of ¥22.9 billion, including foreign exchange losses of ¥8.3 billion on foreign trade transactions in the Iron & Steel Products Segment, as well as a foreign exchange gain of ¥6.4 billion in the commodity derivatives trading business in the Innovation & Corporate Development Segment, which corresponded to related revenues in the same segment.

    Income Taxes

    Income taxes for the year ended March 31, 2014 were ¥180.7 billion, an increase of ¥22.4 billion from ¥158.3 billion for the corresponding previous year.

  • “Income before income taxes and equity in earnings” for the year ended March 31, 2014 was ¥453.7 billion, an increase of ¥139.6 billion from ¥314.1 billion for the corresponding previous year. In response, applicable income taxes also increased.
  • Reversal of deferred tax liabilities related to dividends received from the undistributed retained earnings of associated companies was approximately ¥22.0 billion for the year ended March 31, 2014, a decline of approximately ¥4.0 billion from the corresponding previous year.
  • Reflecting the decline in equity in earnings, the corresponding income tax effect declined.

    The effective tax rate on “Income before income taxes and equity in earnings” for the year ended March 31, 2014 was 39.8%, a decline of 10.6% from 50.4% for the corresponding previous year. The major factors for the decline were an increase in no-tax or low-tax income such as dividend income and a decrease in the ratio of income tax effect recorded for equity in earnings against “Income before income taxes and equity in earnings,” while the factors for the increase include a decline in the ratio of the aforementioned reversal of deferred tax liabilities.

    Equity in Earnings of Associated Companies—Net

    Equity in earnings of associated companies for the year ended March 31, 2014 was ¥173.7 billion, a decline of ¥2.5 billion from ¥176.2billion for the corresponding previous year as a result of the following:

  • Valepar S.A. reported a decline of ¥15.8 billion, reflecting the loss due to Vale S.A.’s participation in the federal tax settlement (REFIS) for payment of amounts relating to Brazilian corporate income tax and social contribution on the net income of its non-Brazilian subsidiaries and affiliates.
  • Reflecting an other-than-temporary decline in the investment value, an impairment loss of ¥14.1 billion was recorded on the investment in SCM Minera Lumina Copper Chile (Chile), a project company for the Caserones copper and molybdenum project.
  • Reflecting the decline in share price, an impairment loss of ¥4.4 billion on listed securities in TPV Technology Limited was recorded.
  • Robe River Mining Co. Pty. Ltd. (Australia) reported an increase of ¥11.8 billion, reflecting an increase in iron ore sales volume and the depreciation of the Japanese yen.
  • CompaÑÍa Minera DoÑa InÉs de Collahuasi SCM (Chile) reported an increase of ¥8.6 billion, mainly due to an increase in sales volume and a decline in cost.
  • Japan Australia LNG (MIMI) Pty. Ltd. (Australia) reported an increase reflecting the depreciation of the Japanese yen.
  • The scrap metal recycling business in which Mitsui Raw Materials Development Pty. Limited (Australia) invests, reported an improvement of ¥3.3 billion, reflecting impairment losses on goodwill recorded in the corresponding previous year.

    Net Income attributable to Noncontrolling Interests

    Net income attributable to noncontrolling interests for the year ended March 31, 2014 was ¥24.6 billion, an increase of ¥0.6 billion from ¥24.0 billion for the corresponding previous year.

    Net Income attributable to Mitsui & Co., Ltd.

    As a result, net income attributable to Mitsui & Co., Ltd. for the year ended March 31, 2014 was ¥422.2 billion, an increase of ¥114.3 billion from ¥307.9 billion for the corresponding previous year.

    [Graph omitted]

    2) Operating Results by Operating Segment

    Effective April 1, 2013, the Innovation & Cross Function Segment changed its name to the Innovation & Corporate Development Segment. Logistics infrastructure businesses, including development and management of ports and airport terminal, advanced materials related businesses such as liquid crystal and electronic devices, and media-related businesses such as TV shopping and broadcasting, all included in the Innovation & Cross Function Segment until March 31, 2013, were transferred to the Machinery & Infrastructure Segment, Chemicals Segment, and Lifestyle Segment, respectively, at the beginning of the year ended March 31, 2014. Meanwhile, in the year ended March31, 2014, steel scrap related businesses of Mitsui Bussan Metals Co., Ltd. in the Mineral & Metal Resources Segment were transferred to Mitsui & Co. Steel Ltd. in the Iron & Steel Products Segment and coal related businesses, except for trading of thermal coal for power utilities, were transferred from the Energy Segment to the Mineral & Metal Resources Segment. The operating segment information for the corresponding previous year has been restated to conform to the current year presentation.

    Iron & Steel Products Segment

    Gross profit for the year ended March 31, 2014 was ¥51.1 billion, an increase of ¥8.9 billion from ¥42.2 billion for the corresponding previous year. Major factors included solid sales of tubular products including line pipe.

    Operating income for the year ended March 31, 2014 was ¥13.6 billion, an increase of ¥10.9 billion from ¥2.7 billion for the corresponding previous year.

    Equity in earnings of associated companies for the year ended March 31, 2014 was ¥5.4 billion, an increase of ¥2.3 billion from ¥3.1 billion for the corresponding previous year.

    Net income attributable to Mitsui & Co., Ltd. for the year ended March 31, 2014 was ¥18.1 billion, an increase of ¥21.9 billion from a net loss of ¥3.8 billion for the corresponding previous year. In addition to the above-mentioned factors, foreign exchange losses of ¥2.1 billion and ¥8.3 billion on foreign trade transactions were recorded for the years ended March 31, 2014 and 2013.

    Mineral & Metal Resources Segment

    Gross profit for the year ended March 31, 2014 was ¥193.6 billion, an increase of ¥32.2 billion from ¥161.4 billion for the corresponding previous year. The main factor behind the increase was a positive impact from an increase in iron ore sales volume and the depreciation of the Japanese yen on iron ore mining operations in Australia.

    As for iron ore pricing, the majority of contract prices applied to products sold during the year ended March 31, 2014 were based on pricing that more closely reflects current spot reference prices, the same pricing as applied in the corresponding previous year, such as a daily average

    of spot reference prices for the current quarter of shipment and a daily average of spot reference prices for the shipment month.

    [Graph omitted]

    Mitsui Iron Ore Development Pty. Ltd. (Australia) and Mitsui-Itochu Iron Pty. Ltd. (Australia) reported increases of ¥23.0 billion and ¥17.1 billion in gross profit, respectively, reflecting the depreciation of the Japanese yen and an increase in iron ore sales volume owing to increased capacity. On the other hand, Mitsui Coal Holdings Pty. Ltd. reported a decline of ¥7.7 billion due to lower coal prices, despite the decline in cost.

    Operating income for the year ended March 31, 2014 was ¥152.0 billion, an increase of ¥27.5 billion from ¥124.5 billion for the corresponding previous year. Despite the increase in gross profit, selling, general and administrative expenses increased.

    Equity in earnings of associated companies for the year ended March 31, 2014 was ¥42.8 billion, a decline of ¥1.6 billion from ¥44.4 billion for the corresponding previous year.

  • Earnings at Robe River Mining Co. Pty. Ltd., an iron ore mining company in Australia, were ¥42.9 billion, an increase of ¥11.8 billion from ¥31.1 billion for the corresponding previous year, reflecting an increase in iron ore sales volume and the depreciation of the Japanese yen.
  • CompaÑÍa Minera DoÑa InÉs de Collahuasi SCM recorded earnings of ¥11.2 billion, an increase of ¥8.6 billion from ¥2.6 billion for the corresponding previous year mainly due to an increase in sales volume and a decline in cost.
  • For the corresponding previous year, the scrap metal recycling business in which Mitsui Raw Materials Development Pty. Limited (Australia) invests, reported an improvement of ¥3.3 billion, mainly attributable to a reversal effect of impairment losses on goodwill recorded for the year ended March 31, 2013.
  • Earnings at Inversiones Mineras Acrux SpA (Chile), a joint venture with Codelco in which Mitsui invested in stages in the year ended March 31, 2013, increased ¥3.1 billion due to the full year contribution.
  • Valepar S.A. posted equity losses of ¥8.0 billion, a decline of ¥15.8 billion from equity earnings of ¥7.8 billion for the corresponding previous year, reflecting the loss due to Vale S.A.’s participation in the federal tax settlement (REFIS) for payment of amounts relating to Brazilian corporate income tax and social contribution on the net income of its non-Brazilian subsidiaries and affiliates.
  • Reflecting an other-than-temporary decline in the investment value, an impairment loss of ¥14.1 billion was recorded on the investment in SCM Minera Lumina Copper Chile, a project company for the Caserones copper and molybdenum project.

    Net income attributable to Mitsui & Co., Ltd. for the year ended March 31, 2014 was ¥95.6 billion, an increase of ¥4.1 billion from ¥91.5 billion for the corresponding previous year. In addition to the above, the following factors affected results:

  • For the corresponding previous year, the deferred commitment fee related to the loan extended to the subsidiary of Codelco was recorded on interest income.
  • Mitsui Coal Holdings Pty. Ltd. recorded an impairment loss of ¥4.5 billion on an undeveloped coal deposit for the year ended March 31, 2014.
  • Foreign exchange gains and losses related to borrowings denominated in U.S. dollars at Mitsui Raw Materials Development Pty. Ltd. deteriorated by ¥3.8 billion from the corresponding previous year.
  • For the year ended March 31, 2014, an impairment loss of ¥9.5 billion on preferred shares of Valepar S.A. was recorded reflecting an other-than-temporary decline related to a foreign exchange translation loss in the investment value of the current portion of preferred shares. Meanwhile, an impairment loss of ¥4.5 billion on preferred shares of Valepar S.A. was recorded for the corresponding previous year.
  • For the corresponding previous year, Australian iron ore operations, which are run as joint ventures with BHP Billiton through Mitsui Iron Ore Development Pty. Ltd. and Mitsui-Itochu Iron Pty. Ltd., recorded impairment losses totaling ¥6.4 billion for the pre-commitment works for the outer harbour development at Port Hedland in Western Australia.

    Machinery & Infrastructure Segment

    Gross profit for the year ended March 31, 2014 was ¥115.5 billion, an increase of ¥8.7 billion from ¥106.8 billion for the corresponding previous year.

  • The Infrastructure Projects Business Unit reported a decline of ¥0.4 billion.
  • The Integrated Transportation Systems Business Unit reported an increase of ¥9.2 billion. Automotive-related and mining and construction machinery-related businesses in South America as well as the locomotive leasing business in Europe achieved a solid performance.

    Operating loss for the year ended March 31, 2014 was ¥8.7 billion, an improvement of ¥3.9 billion from ¥12.6 billion for the corresponding previous year. Despite the increase in gross profit, selling, general and administrative expenses increased.

    Equity in earnings of associated companies for the year ended March 31, 2014 was ¥16.8 billion, a decline of ¥15.5 billion from ¥32.3 billion for the corresponding previous year.

  • The Infrastructure Projects Business Unit reported a decline of ¥5.9 billion.

    - IPP businesses reported equity in earnings of ¥11.2 billion in total, a decline of ¥1.1 billion from ¥12.3 billion for the corresponding previous year. A decline of ¥11.6 billion was caused by the recognition of outstanding interest expense for previous years in Paiton 1. Meanwhile, coal-fired power plant, Paiton 3 in Indonesia, which commenced commercial operation, was new contributor. Furthermore, mark-to-market valuation gains and losses, such as those on long-term power derivative contracts and long-term fuel purchase contracts, improved by ¥3.3 billion to a gain of ¥2.3 billion from a loss of ¥1.0 billion for the corresponding previous year.

    - A ¥3.8 million impairment loss was recorded in an infrastructure business other than IPP business.

  • The Integrated Transportation Systems Business Unit reported a decline of ¥9.5 billion. The main factor behind the decline was an increase in the research and development costs incurred for the development of a new aircraft engine with General Electric Company.

    Net income attributable to Mitsui & Co., Ltd. for the year ended March 31, 2014 was ¥26.6 billion, an increase of ¥9.6 billion from ¥17.0 billion for the corresponding previous year. In addition to the above, the following factors affected results:

  • This segment recorded a ¥14.4 million interest income incurred in previous years with respect to a loan to Paiton 1.
  • Reversal of deferred tax liabilities on undistributed retained earnings of associated companies at the time of profit distribution increased by approximately ¥3.5 billion from the corresponding previous year.

    Chemicals Segment

    Gross profit for the year ended March 31, 2014 was ¥80.5 billion, an increase of ¥9.8 billion from ¥70.7 billion for the corresponding previous year.

  • The Basic Chemicals Business Unit reported an increase of ¥7.9 billion due to a recovery in underperforming trading activities of petrochemical materials for the corresponding previous year.
  • The Performance Chemicals Business Unit reported an increase of ¥1.9 billion. The major factors included the positive effect of the depreciation of the Japanese yen and strong sales of agricultural chemicals at Mitsui AgriScience International SA/NV (Belgium.)

    Operating income for the year ended March 31, 2014 was ¥11.3 billion, an increase of ¥3.9 billion from ¥7.4 billion for the corresponding previous year. Despite the increase in gross profit, selling, general and administrative expenses increased.

    Equity in earnings of associated companies for the year ended March 31, 2014 was ¥8.6 billion, an increase of ¥2.0 billion from ¥6.6 billion for the corresponding previous year.

    Net income attributable to Mitsui & Co., Ltd. for the year ended March 31, 2014 was ¥15.8 billion, an increase of ¥17.3 billion from a net loss of ¥1.5 billion for the corresponding previous year. In addition to the above-mentioned factors, the following factors also affected results:

  • For the year ended March 31, 2014, this segment recorded a gain of ¥3.3 billion on the sale of shares in Daicel Corporation.
  • For the year ended March 31, 2014, this segment recorded a loss of ¥3.0 billion due to the cancellation of a study on alpha olefins production in the United States.
  • For the corresponding previous year, this segment recorded an impairment loss of ¥3.0 billion on listed shares in Mitsui Chemicals Inc. reflecting a decline in the share price.

    Energy Segment

    The weighted average crude oil prices applied to our operating results for the years ended March 31, 2014 and 2013 were estimated to be US$110 and US$114 per barrel, respectively.

    Gross profit for the year ended March 31, 2014 was ¥186.6 billion, an increase of ¥0.1 billion from ¥186.5 billion for the corresponding previous year, primarily due to the following factors:

  • Mitsui E&P Middle East B.V. reported an increase of ¥26.9 billion due to a decline in production cost, an increase in oil production and the depreciation of the Japanese yen.
  • Mitsui E&P USA LLC (United States) reported an improvement of ¥6.9 billion due to a reduction in unit depreciation costs associated with an increase in proved reserves of shale gas as well as higher gas prices.
  • Mitsui E&P Australia Pty Limitedreported a decline of ¥32.5 billion due to a decline in production associated with refurbishment of its oil production facility.
  • The sale of Mitsui Oil Co., Ltd. in the three-month period ended March 31, 2014 resulted in a decrease of ¥4.6 billion.

    [Graph omitted]

    Operating income for the year ended March 31, 2014 was ¥129.1 billion, a decline of ¥6.2 billion from ¥135.3 billion for the corresponding previous year. While gross profit remained flat, selling, general and administrative expenses increased.

    Equity in earnings of associated companies for the year ended March 31, 2014 was ¥60.2 billion, an increase of ¥5.0 billion from ¥55.2 billion for the corresponding previous year. Japan Australia LNG (MIMI) Pty. Ltd. reported an increase reflecting the depreciation of the Japanese yen.

    Net income attributable to Mitsui & Co., Ltd. for the year ended March 31, 2014 was ¥197.0 billion, an increase of ¥32.4 billion from ¥164.6 billion for the corresponding previous year. In addition to the above, the following factors also affected results:

  • Dividends from six LNG projects (Abu Dhabi, Oman, Qatargas 1 and 3, Equatorial Guinea, and Sakhalin II) were ¥96.2 billion in total, an increase of ¥35.0 billion from ¥61.2 billion for the corresponding previous year, due mainly to increase in dividends received from the Sakhalin II and the Qatargas 1 projects.
  • For the year ended March 31, 2014, Mitsui recorded a capital gain of ¥12.0 billion from the sale of shares in Mitsui Oil Co., Ltd, and Mitsui Oil Exploration Co., Ltd. recorded an ¥8.3 billion gain on the sale of shares in INPEX Corporation. For the corresponding previous year, Mitsui Oil Exploration Co., Ltd. recorded a ¥6.2 billion gain on the sale of shares in INPEX Corporation.
  • For the year ended March 31, 2014, Mitsui E&P Middle East B.V. and Mitsui E&P Australia Pty Limited recorded a total of ¥6.2 billion gain on sales of interests in oil fields in Egypt and New Zealand, respectively.
  • For the year ended March 31, 2014, a ¥3.3 billion impairment loss on investment in an LNG project was recorded reflecting an other-than-temporary decline in the investment value.
  • Reversal of deferred tax liabilities on undistributed retained earnings of associated companies at the time of profit distribution declined by approximately ¥8.0 billion from the corresponding previous year.
  • For the year ended March 31, 2014, exploration expenses of ¥18.6 billion in total were recorded, including those recorded by Mitsui E&P Australia Pty Limited and Mitsui E&P Mozambique Area 1 Limited. For the corresponding previous year, exploration expenses totaled ¥33.4 billion, including those recorded by Mitsui E&P Mozambique Area 1 Limited (United Kingdom), Mitsui Oil Exploration Co., Ltd. and Mitsui E&P Australia Pty Limited.

    Lifestyle Segment

    Gross profit for the year ended March 31, 2014 was ¥111.7 billion, the same amount as the corresponding previous year.

  • The Food Resources Business Unit reported a decline of ¥1.4 billion.
  • The Food Products & Services Business Unit recorded a decline of ¥3.9 billion, mainly attributable to underperforming domestic businesses.
  • The Consumer Service Business Unit reported an increase of ¥5.3 billion, mainly attributable to the new contribution from Paul Stuart, Inc. (United States), which was acquired during the three-month period ended December 31, 2012.

    Operating loss for the year ended March 31, 2014 was ¥17.8 billion, a deterioration of ¥10.8 billion from ¥7.0 billion for the corresponding previous year. Selling, general and administrative expenses increased.

    Equity in earnings of associated companies for the year ended March 31, 2014 was ¥19.8 billion, an increase of ¥6.7 billion from ¥13.1 billion for the corresponding previous year.

  • The Food Resources Business Unit reported an increase of ¥5.6 billion. Ventura Foods, LLC, a U.S. edible oil manufacturer in which Wilsey Foods, Inc. invests, contributed to the increase. For the corresponding previous year, this business unit recorded a ¥2.9 billion impairment loss on listed shares in Mitsui Sugar Co., Ltd. due to a decline in the share price.
  • The Food Products & Services Business Unit reported the same amount as the corresponding previous year.
  • The Consumer Service Business Unit reported an increase of ¥1.1 billion. Arch Pharmalabs Limited, a pharmaceutical contract manufacturer in India, posted an equity loss of ¥4.2 billion and ¥3.3 billion, reflecting impairment losses on long-lived and other assets for the years ended March 31, 2014 and 2013, respectively.

    Net income attributable to Mitsui & Co., Ltd. for the year ended March 31, 2014 was ¥19.2 billion, an increase of ¥6.2 billion from ¥13.0 billion for the corresponding previous year. In addition to the above-mentioned factors, the following factors also affected results:

  • For the year ended March 31, 2014, this segment recorded a ¥4.1 billion gain on sale of shares in a port terminal company in Brazil by Multigrain Trading AG; a ¥3.2 billion gain on the exchange of shares in Mikuni Coca-Cola Bottling Co., Ltd. for Coca-Cola East Japan Co., Ltd.; and a ¥3.2 billion gain on sale of shares in an overseas lifestyle-related company. Furthermore, Bussan Real Estate Co., Ltd. recorded a ¥4.7 billion gain on sales of office buildings in Japan.
  • For the corresponding previous year, this segment recorded an ¥8.0 billion gain on the partial sale of shares in Mikuni Coca-Cola Bottling Co., Ltd. and a ¥5.5 billion gain related to equity dilution in IHH Healthcare Berhad.

    Innovation & Corporate Development Segment

    Gross profit for the year ended March 31, 2014 was ¥22.4 billion, a decline of ¥9.2 billion from ¥31.6 billion for the corresponding previous year. Gross profit corresponding to foreign exchange gains of ¥14.4 billion and ¥6.4 billion related to the commodity derivatives trading business at Mitsui posted in other expenses-net was included in gross profit for the year ended March 31, 2014 and for the corresponding previous year, respectively; there was a decline in gross profit corresponding to the ¥8.0 billion increase of foreign exchange gains.

    Operating loss for the year ended March 31, 2014 was ¥37.3 billion, a deterioration of ¥10.2 billion from ¥27.1 billion for the corresponding previous year.

    Equity in earnings of associated companies for the year ended March 31, 2014 was ¥7.4 billion, a decline of ¥5.5 billion from ¥12.9 billion for the corresponding previous year. For the year ended March 31, 2014, this segment recorded an impairment loss of ¥4.4 billion on listed securities in TPV Technology Limited reflecting the decline in share price.

    Net income attributable to Mitsui & Co., Ltd. for the year ended March 31, 2014 was ¥4.9 billion, an increase of ¥0.2 billion from ¥4.7 billion for the corresponding previous year. In addition to the above-mentioned factors, the following factors also affected results:

  • For the year ended March 31, 2014 and for the corresponding previous year, foreign exchange gains of ¥14.4 billion and ¥6.4 billion, respectively, were posted in other expense-net in relation to the commodity derivatives trading business at Mitsui.
  • For the year ended March 31, 2014, this segment recorded a gain of ¥10.5 billion on the partial sale of shares in QIWI plc and a gain of ¥5.1 billion on the sale of shares in Brightstar Corp.
  • For the corresponding previous year, this segment recorded a gain of ¥4.8 billion on the partial sale of shares in Nihon Unisys, Ltd. and a gain of ¥4.3 billion on the sale of shares in LME Holdings Limited.

    Americas Segment

    Gross profit for the year ended March 31, 2014 was ¥77.5 billion, an increase of ¥11.5 billion from ¥66.0 billion for the corresponding previous year. The depreciation of the Japanese yen as well as Cinco Pipe & Supply, LLC, which was newly acquired during the three-month period ended December 31, 2012, contributed to the increase.

    Operating income for the year ended March 31, 2014 was ¥11.9 billion, an increase of ¥0.5 billion from ¥11.4 billion for the corresponding previous year. Despite the increase in gross profit, selling, general and administrative expenses increased reflecting the depreciation of the Japanese yen.

    Equity in earnings of associated companies for the year ended March 31, 2014 was ¥6.5 billion, an increase of ¥3.0 billion from ¥3.5 billion for the corresponding previous year.

    Net income attributable to Mitsui & Co., Ltd. for the year ended March 31, 2014 was ¥13.8 billion, an increase of ¥1.4 billion from ¥12.4 billion for the corresponding previous year. In addition to the above-mentioned factors, the following factors also affected results:

  • For the year ended March 31, 2014, MBK Real Estate LLC recorded a ¥4.3 billion gain on the sale of senior living facilities.
  • For the corresponding previous year, this segment recorded a gain of ¥3.1 billion on the sale of shares in MED3000 Group, Inc.

    Europe, the Middle East and Africa Segment

    Gross profit for the year ended March 31, 2014 was ¥22.1 billion, an increase of ¥6.5 billion from ¥15.6 billion for the corresponding previous year. MBK Real Estate Europe Limited (United Kingdom) reported an increase of ¥3.7 billion due to the sale of an office building.

    Operating income for the year ended March 31, 2014 was ¥0.7 billion, an increase of ¥4.4 billion from a loss of ¥3.7 billion for the corresponding previous year.

    Equity in earnings of associated companies for the year ended March 31, 2014 was ¥1.5 billion, an increase of ¥1.1 billion from ¥0.4 billion for the corresponding previous year.

    Net income attributable to Mitsui & Co., Ltd. for the year ended March 31, 2014 was ¥4.8 billion, an increase of ¥5.7 billion from a net loss of ¥0.9 billion for the corresponding previous year.

    Asia Pacific Segment

    Gross profit for the year ended March 31, 2014 was ¥12.5 billion, an increase of ¥2.0 billion from ¥10.5 billion for the corresponding previous year.

    Operating loss for the year ended March 31, 2014 was ¥6.9 billion, a deterioration of ¥1.0 billion from ¥5.9 billion for the corresponding previous year.

    Equity in earnings of associated companies for the year ended March 31, 2014 was ¥4.5 billion, a decline of ¥0.4 billion from ¥4.9 billion for the corresponding previous year.

    Net income attributable to Mitsui & Co., Ltd. for the year ended March 31, 2014 was ¥35.2 billion, an increase of ¥7.7 billion from ¥27.5 billion for the corresponding previous year. In addition to the above, this segment recorded earnings from the segment’s minority interest in Mitsui Iron Ore Development Pty. Ltd. and Mitsui-Itochu Iron Pty. Ltd.

    (3) Financial Condition and Cash Flows

    1) Financial Condition

    Total assets as of March 31, 2014 were ¥11,001.3 billion, an increase of ¥676.7 billion from ¥10,324.6 billion as of March 31, 2013.

    [Graphic Omitted]

    Total current assets as of March 31, 2014 were ¥4,430.3 billion, a decline of ¥201.2 billion from ¥4,631.5 billion as of March 31, 2013. Cash and cash equivalents declined by ¥200.1 billion

    Total current liabilities as of March 31, 2014 were ¥2,972.2 billion, a decline of ¥73.1 billion from ¥3,045.3 billion as of March 31, 2013. Current maturities of long-term debt increased by ¥82.2 billion due to reclassification to current maturities, while short-term debt declined by ¥143.9 billion. Trade payables declined by ¥59.3 billion mainly attributable to a decrease in the precious metal lease business in the Innovation & Corporate Development Segment.

    As a result, working capital, or current assets less current liabilities, as of March 31, 2014 totaled ¥1,458.1 billion, a decline of ¥128.1 billion from ¥1,586.2 billion as of March 31, 2013.

    The sum of “total investments and non-current receivables,” “net property and equipment,” “intangible assets, less accumulated amortization,” “deferred tax assets-non-current,” and “other assets” as of March 31, 2014 totaled ¥6,571.0 billion, an increase of ¥877.9 billion from ¥5,693.1 billion as of March 31, 2013, mainly due to the following factors:

    Within this category, the total of investments and non-current receivables as of March 31, 2014 was ¥4,543.5 billion, an increase of ¥584.7 billion from ¥3,958.8 billion as of March 31, 2013.

  • Investments in and advances to associated companies as of March 31, 2014 was ¥2,729.5 billion, an increase of ¥404.2 billion from ¥2,325.3 billion as of March 31, 2013. Major factors were as follows:

    - An increase due to an acquisition of a 20% stake in ESBR ParticipaÇÕes S.A., running the Jirau hydropower project in Brazil;

    - An increase of ¥39.4 billion due to an investment in the North and South American operations of an automotive components supplier, Gestamp AutomociÓn, S.L.;

    - An increase of ¥38.8 billion due to an acquisition of a 28% stake in International Power (Australia) Holdings Pty Ltd, which is engaged in power generation and power and gas retail business in Australia;

    - An increase of ¥32.4 billion due to an investment in the Caserones copper and molybdenum project in Chile;

    - An increase of ¥12.7 billion due to an acquisition of a 49% stake in Czech water business companies, Aqualia Czech, S.L. and Aqualia Infraestructuras InženÝring, s.r.o.;

    - An increase due to an acquisition of a 20% stake in Medini Iskandar Malaysia Sdn. Bhd., which is engaged in the urban development of a smart city in Malaysia;

    - An increase of ¥11.2 billion due to an investment in a methanol manufacturing joint venture in the United States;

    - An increase of ¥11.2 billion due to an acquisition of a 20.6% stake in Astoria I power generation business in the United States; and

    - Factors that do not involve cash flow included an increase of ¥100.0 billion resulting from a foreign exchange translation adjustment on foreign investments due to the depreciation of the Japanese yen despite net declines in equity earnings of ¥0.3 billion (net of ¥174.0 billion in dividends received from associated companies).

  • Other investments as of March 31, 2014 were ¥950.5 billion, an increase of ¥134.2 billion from ¥816.3 billion as of March 31, 2013, mainly due to the following factors:

    - An increase of ¥61.3 billion due to an acquisition of a 7% share in BHP Iron Ore (Jimblebar) Pty. Ltd., which is developing the Jimblebar iron ore mine in Australia;

    - An increase of ¥42.4 billion net increase in unrealized holding gains on available-for-sale securities, and

    - An increase of ¥33.6 billion due to an acquisition of shares in TonenGeneral Sekiyu K.K.

  • Net property and equipment as of March 31, 2014 totaled ¥1,834.1 billion, an increase of ¥263.8 billion from ¥1,570.3 billion as of March 31, 2013, mainly due to the following factors:

    - An increase of ¥93.3 billion due to an acquisition of a 25% interest in the Tempa Rossa onshore oil field in the Gorgoglione concession in Italy;

    - An increase of ¥52.2 billion (including a foreign exchange translation gain of ¥25.2 billion) at the Marcellus and Eagle Ford shale gas and oil producing operations in the United States;

    - An increase of ¥86.6 billion (including a foreign exchange translation gain of ¥18.7 billion and a ¥32.5 billion increase due to capitalization of dismantling and removing costs corresponding to asset retirement obligation recorded at Mitsui Oil Exploration Co., Ltd.) at oil and gas producing operations other than U.S. shale gas and oil operations and the acquisition of the Tempa Rossa onshore oil field;

    - An increase of ¥43.8 billion (including a foreign exchange translation loss of ¥8.5 billion) at iron ore mining operations in Australia;

    - A decline of ¥12.6 billion due to the deconsolidation of Mitsui Oil Co., Ltd.;

    - A decline of ¥11.2 billion (including a foreign exchange translation loss of ¥5.5 billion) at coal mining operations in Australia; and

    - A decline of ¥10.6 billion (including a foreign exchange translation gain of ¥0.9 billion), primarily due to taking over an ammonia plant at P. T. Kaltim Pasifik Amoniak (Indonesia).

    Long-term debt less current maturities as of March 31, 2014 was ¥3,432.5 billion, an increase of ¥247.5 billion from ¥3,185.0 billion as of March 31, 2013, mainly due to an increase in long-term borrowings at financial subsidiaries. Furthermore, Mitsui Oil Exploration Co., Ltd. recognized the asset retirement obligation of ¥42.0 billion on other long-term liabilities.

    Total Mitsui & Co., Ltd. shareholders’ equity as of March 31, 2014 was ¥3,586.4 billion, an increase of ¥404.6 billion from ¥3,181.8 billion as of March 31, 2013. The major component of the increase were an increase of ¥338.2 billion in retained earnings; an increase of ¥84.7 billion in foreign currency translation adjustments reflecting the appreciation of the U.S. dollar against the Japanese yen; and an increase of ¥29.1 billion in unrealized holding gains on available-for-sale securities due to higher stock prices. Meanwhile, treasury stock which is a subtraction item in shareholders’ equity increased by ¥50.2 billion mainly attributable to the share buyback.

    As a result, the equity-to-asset ratio as of March 31, 2014 was 32.6%, 1.8% higher compared to 30.8% as of March 31, 2013. Net interest-bearing debt, or interest-bearing debt less cash and cash equivalents and time deposits as of March 31, 2014 was ¥3,224.4 billion, an increase of ¥385.0 billion from ¥2,839.4 billion as of March 31, 2013. The net debt-to-equity ratio (DER) as of March 31, 2014 was 0.90 times, 0.01 points higher compared to 0.89 times as of March 31, 2013.

    [Table Omitted]

    2) Cash Flows

    Cash Flows from Operating Activities

    Net cash provided by operating activities for the year ended March 31, 2014 was ¥521.5 billion, an increase of ¥60.1 billion from ¥461.4 billion for the corresponding previous year. Major components of net cash provided by operating activities were our operating income of ¥275.2 billion, dividend income of ¥273.7 billion, including dividends received from associated companies, and a net cash outflow of ¥74.9 billion from an increase in working capital, or changes in operating assets and liabilities.

    Compared with the corresponding previous year, dividend income increased by ¥77.9 billion and operating income increased by ¥20.6 billion, while net cash flow from changes in working capital deteriorated by ¥77.3 billion.

    Cash Flows from Investing Activities

    Net cash used in investing activities for the year ended March 31, 2014 was ¥704.5 billion, a decline of ¥48.8 billion from ¥753.3 billion for the corresponding previous year. Net cash used in investing activities consisted of the following:

  • Net outflows of cash that corresponded to investments in and advances to associated companies (net of sales of investments in and collection of advances to associated companies) were ¥217.6 billion. The major cash outflows were:

    - An acquisition of a 20% stake in ESBR ParticipaÇÕes S.A.;

    - An acquisition of a 30% stake in Gestamp AutomociÓn, S.L.’s North and South American operations for ¥39.4 billion;

    - An acquisition of a 28% stake in International Power (Australia) Holdings Pty Ltd for ¥38.8 billion;

    - An investment in the Caserones copper and molybdenum project in Chile for ¥32.4 billion;

    - An acquisition of a 49% stake in Aqualia Czech, S.L. and Aqualia Infraestructuras InženÝring, s.r.o. for ¥12.7 billion;

    - An acquisition of a 20% stake in Medini Iskandar Malaysia Sdn. Bhd.;

    - An investment in and loan to FPSO leasing business for oil and gas production in Brazil for ¥11.2 billion;

    - An investment in the methanol manufacturing joint venture in the United States for ¥11.2 billion; and

    - An acquisition of a 20.6% stake in Astoria I power generation business in the United States for ¥11.2 billion.

    The major cash inflows included collection of a loan for ¥24.5 billion from FPSO leasing business for oil and gas production in Brazil.

  • Net outflows of cash that corresponded to other investments and business (net of sales and redemption of other investments and business) were ¥89.8 billion. Major cash expenditures included an acquisition of a 25% interest in an onshore oil field in Italy for ¥98.3 billion; an acquisition of a 7% share in BHP Iron Ore (Jimblebar) Pty. Ltd. for ¥61.3 billion; and an acquisition of shares in TonenGeneral Sekiyu K. K. for ¥33.6 billion. The major cash inflows included sales of interests in oil fields in Egypt and New Zealand for ¥19.1 billion in total; the sale of shares in Mitsui Oil Co., Ltd. for ¥15.0 billion; the sale of shares in QIWI plc for ¥14.7 billion; and the sale of shares in Brightstar Corp. for ¥11.9 billion.
  • Net outflows of cash that corresponded to long-term loan receivables (net of collection) were ¥23.3 billion. The major cash outflows were attributable to an increase in loan receivables at PT. Bussan Auto Finance, a motorcycle retail finance subsidiary in Indonesia, for ¥14.6 billion and the loan to BHP Iron Ore (Jimblebar) Pty. Ltd.
  • Net outflows of cash relating to purchases of property leased to others and property and equipment (net of sales of those assets) were ¥374.6 billion. Major expenditures included:

    - Oil and gas producing operations other than U.S. shale gas and oil for a total of ¥111.2 billion;

    - Marcellus and Eagle Ford shale gas and oil producing operations in the United States for ¥91.2 billion;

    - Iron ore mining operations in Australia for ¥80.3 billion;

    - Rolling stock for leasing for ¥25.8 billion;

    - Vessels for ¥17.7 billion;

    - Coal mining operations in Australia for ¥15.7 billion; and

    - Tank terminals in the United States for ¥11.5 billion.

    The major cash inflows included sales of rolling stock for leasing for ¥18.3 billion.

    Free cash flow, or the sum of net cash provided by operating activities and net cash used in investing activities, for the year ended March 31, 2014 was a net outflow of ¥183.0 billion.

    Cash Flows from Financing Activities

    For the year ended March 31, 2014, net cash used in financing activities was ¥34.7 billion, an increase in net outflow of ¥256.3 billion from ¥221.6 billion for the corresponding previous year. The net cash inflow from the borrowing of long-term debt was ¥212.2 billion, while the net cash outflow from the borrowing of short term debt was ¥109.8 billion. Meanwhile, the cash outflow for payments of cash dividends was ¥84.0 billion and the net cash outflow from the purchases of treasury stock was ¥50.2 billion.

    In addition to the changes discussed above, there was an increase in cash and cash equivalents of ¥17.6 billion due to foreign exchange translation; as a result, cash and cash equivalents as of March 31, 2014 totaled ¥1,225.1 billion, a decline of ¥200.1 billion from ¥1,425.2 billion as of March 31, 2013.

    2. Management Polices

    (1) New Medium-term Management Plan

    Please refer to “New Medium-term Management Plan Challenge & Innovation for 2020 –Demonstrating Mitsui Premium –” announced today.

    (2) Forecasts for the year ending March 31, 2015

    1) Forecasts for the year ending March 31, 2015

    [Table Omitted]

    *1 It contains “Provision for doubtful receivables.”

    *2 We use EBITDA as a measure of underlying earning power.

    Mitsui will adopt International Financial Reporting Standards ("IFRS") for its annual securities report under the Financial Instruments and Exchange Act from the year ended March 31, 2014. Forecasts for the year ending March 31, 2015 were prepared based on IFRS.

    EBITDA for the year ending March 31, 2015 is expected to be ¥850.0 billion and net income attributable to Mitsui & Co., Ltd. is expected to be ¥380.0 billion.

    We assume foreign exchange rates for the year ending March 31, 2015 will be ¥100/US$, ¥95/AU$ and ¥45/BRL, while average foreign exchange rates for the year ended March 31, 2014 were ¥100.49/US$, ¥92.91/AU$ and ¥44.67/BRL. Our assumption for the annual average crude oil price applicable to our financial results for the year ending March 31, 2015 is US$104/barrel, down US$6 from US$110/barrel applied for the year ended March 31, 2014, based on the assumption that the crude oil price (JCC) will be maintained at US$102/barrel throughout the year ending March 31, 2015.

    The forecast for annual operating results by operating segment compared to the results for the year ended March 31, 2014 is as follows:

    (Billions of yen)   Year ending

    March 31, 2015

    (IFRS)

      Year ended

    March 31, 2014

    (USGAAP)

      Change
    Iron & Steel Products   8.0   18.1   (10.1)
    Mineral & Metal Resources   118.0   95.6   22.4
    Machinery & Infrastructure   38.0   26.6   11.4
    Chemicals   8.0   15.8   (7.8)
    Energy   140.0   197.0   (57.0)
    Lifestyle   14.0   19.2   (5.2)
    Innovation & Corporate Development   (2.0)   4.9   (6.9)
    Americas   16.0   13.8   2.2
    Europe, the Middle East and Africa   1.0   4.8   (3.8)
    Asia Pacific   33.0   35.2   (2.2)
    All Other/Adjustments and Eliminations   6.0   (8.8)   14.8
    Consolidated total   380.0   422.2   (42.2)
  • Projected net income attributable to Mitsui & Co., Ltd. from the Iron & Steel Products Segment for the year ending March 31, 2015 is ¥8.0 billion, a decline of ¥10.1 billion from the year ended March 31, 2014. We expect a reversal effect of gains on sales of securities recorded in the year ended March 31, 2014.
  • Projected net income attributable to Mitsui & Co., Ltd. from the Mineral & Metal Resources Segment is ¥118.0 billion, an increase of ¥22.4 billion from the year ended March 31, 2014. While the commodity prices are expected to decline, we also expect a reversal effect of tax related loss reported by Valepar and the impairment loss on the investment in the Caserones copper and molybdenum project recorded in the year ended March 31, 2014..
  • Projected net income attributable to Mitsui & Co., Ltd. from the Machinery & Infrastructure Segment is ¥38.0 billion, an increase of ¥11.4 billion from the year ended March 31, 2014. The primary reasons for the increase are a reversal effect of one-time losses recorded in the year ended March 31, 2014; a decline in the research and development costs for the development of a new aircraft engine; and contributions from businesses acquired in the year ended March 31, 2014.
  • Projected net income attributable to Mitsui & Co., Ltd. from the Chemicals Segment is ¥8.0 billion, a decline of ¥7.8 billion from the year ended March 31, 2014. In addition to a reversal effect of gains on sales of securities recorded in the year ended March 31, 2014, we expect the negative effect of the asset transfer at P. T. Kaltim Pasifik Amoniak.
  • Projected net income attributable to Mitsui & Co., Ltd. from the Energy Segment is ¥140.0 billion, a decline of ¥57.0 billion from the year ended March 31, 2014. In addition to the decline in dividends from LNG projects, we expect a reversal effect of gains on sales of securities and fixed assets recorded in the year ended March 31, 2014.
  • Projected net income attributable to Mitsui & Co., Ltd. from the Lifestyle Segment is ¥14.0 billion, a decline of ¥5.2 billion from the year ended March 31, 2014. We expect a reversal effect of gains on sales of securities and fixed assets recorded in the year ended March 31, 2014, while we anticipate a profit growth in grain trading.
  • Projected net loss attributable to Mitsui & Co., Ltd. from the Innovation & Corporate Development Segment is ¥2.0 billion, a decline of ¥6.9 billion from the year ended March 31, 2014, mainly attributable to the reversal effect of gains on sales of securities including those in QIWI plc. and Brightstar Corp. recorded in the year ended March 31, 2014.
  • Projected net income attributable to Mitsui & Co., Ltd. from the Americas Segment is ¥16.0 billion, an increase of ¥2.2 billion from the year ended March 31, 2014, reflecting a recovery in United Grain Corporation. Projected net income attributable to Mitsui & Co., Ltd. from the Europe, the Middle East and Africa Segment is ¥1.0 billion, a decline of ¥3.8 billion from the year ended March 31, 2014, due to the reversal effect of gains on sale of an office building recorded in the year ended March 31, 2014. Projected net income attributable to Mitsui & Co., Ltd. from the Asia Pacific Segment is ¥33.0 billion, a decline of ¥2.2 billion from the year ended March 31, 2014, due to decreases in this segment’s portion of net income from subsidiaries of the Mineral & Metal Resources.

    2) Key commodity prices and other parameters for the year ending March 31, 2015

    The table below shows assumptions for key commodity prices and other parameters for the projected net income attributable to Mitsui & Co., Ltd. for the year ending March 31, 2015. Effects of price movements for each commodity on annual net income attributable to Mitsui & Co., Ltd. are included in the table.

    Impact on Net Income attributable to Mitsui & Co., Ltd.

    for the Year ending March 31, 2015

     

    March 2015

    Assumption

      March 2014

    Result

    Commodity   Crude Oil/JCC   ¥1.8 bn (US$1/bbl) 102 110
      Consolidated Oil Price(*1)     104 110
      U.S. Natural Gas(*2)   ¥0.3 bn (US$0.1/mmBtu)(*2)   4.25(*3) 3.73
      Iron Ore   ¥2.5 bn (US$1/ton)   (*5) 122(*4)
      Copper   ¥0.7 bn (US$100/ton)   7,000 7,326(*6)
    Forex (*7)   USD   ¥2.7 bn (¥1/USD)   100 100.49
      AUD   ¥1.5 bn (¥1/AUD)   95 92.91
      BRL   ¥0.5 bn (¥1/BRL)   45 44.67


    (*1) The oil price trend is reflected in net income with a 0-6 month time lag. We assume the annual average price applicable to our financial results as the Consolidated Oil Price based on the estimation: 4-6 month time lag, 35%; 1-3 month time lag, 41%; no time lag, 24% for the year ending March 31, 2015.

    (*2) US shale gas are not all sold at Henry Hub(HH) linked prices. Therefore the sensitivity does not represent the direct impact of HH movement, but rather the impact from the movement of weighted average gas sales price.

    (*3) For natural gas sold in the US on HH linked prices, the assumed price used is US$4.25/mmBtu.

    (*4) Daily average of representative reference prices (Fine, Fe 62% CFR North China) during April 2013 to March 2014

    (*5) We refrain from disclosing the iron ore price assumptions.

    (*6) Average of LME cash settlement price during January 2013 to December 2013

    (*7) Impact of currency fluctuation on net income of overseas subsidiaries and associated companies (denomination in functional currency) against the Japanese yen

    Impact of currency fluctuation between their functional currencies against revenue currencies and exchange rate hedging are not included.

    (3) Profit Distribution Policy

    In order to increase corporate value and maximize shareholder value, we have sought to maintain an optimal balance between (a) meeting investment demand in our core and growth areas through re-investments of our retained earnings, and (b) directly providing returns to shareholders by paying out cash dividends based on a target dividend payout ratio of consolidated net income.

    For the two-year period of the Medium-term Management Plan to March 2014, while we principally aim for a steady increase in dividends through improvements in corporate performance, we also considered more flexible compensation to the shareholders, provided that sufficient retained earnings for future business development is secured, and we set our minimum target dividend payout ratio at 25%. For the year ended March 31, 2014, we plan to pay an annual dividend of ¥59 per share, a ¥16 per share increase from the corresponding previous year.

    For the period of the new Medium-term Management Plan, we have raised our target dividend payout ratio to 30% of consolidated net income. Pursuant to our policy, for the year ending March 31, 2015, we currently envisage an annual dividend of ¥64 per share, a ¥5 increase from the year ended March 31, 2014, on the assumption that our annual consolidated net income attributable to Mitsui & Co., Ltd. will be ¥380 billion, as mentioned in our forecast net income for the year ending March 31, 2015.

    For the year ended March 31, 2014, we conducted a share buyback program of up to ¥50 billion in total, to improve our capital efficiency. For the period of the new Medium-term Management Plan, we will take measures accordingly in a prompt and flexible manner as needed, taking into consideration the business environment, future investment activity trends, free cash flow and interest-bearing debt levels, and return on equity.

    3. Other Information

    Notice:

    This flash report contains forward-looking statements about Mitsui and its consolidated subsidiaries. These forward-looking statements are based on Mitsui’s current assumptions, expectations and beliefs in light of the information currently possessed by it and involve known and unknown risks, uncertainties and other factors. Such risks, uncertainties and other factors may cause Mitsui’s actual consolidated financial position, consolidated operating results or consolidated cash flows to be materially different from any future consolidated financial position, consolidated operating results or consolidated cash flows expressed or implied by these forward-looking statements.

    These risks, uncertainties and other factors include, among others, (1) economic downturns worldwide or at specific regions, (2) fluctuations in commodity prices, (3) fluctuations in exchange rates, (4) credit risks from clients with which Mitsui and its consolidated subsidiaries have business transactions or financial dealings and/or from various projects, (5) declines in the values of assets for which Mitsui and its consolidated subsidiaries act as lessors, (6) changes in the financing environment, (7) declines in market value of equity and/or debt securities, (8) changes in evaluation in connection to the establishment of valuation allowances for deferred tax assets, (9) inability to successfully restructure or eliminate subsidiaries or associated companies as planned, (10) unsuccessful joint ventures and strategic investments, (11) risks of resource related businesses not developing in line with assumed costs and schedules and uncertainty in reserves and performance of third party operators, (12) loss of opportunities to enter new business areas due to limitations on business resources, (13) environmental laws and regulations, (14) changes in laws and regulations or unilateral changes in contractual terms by governmental entities, (15) employee misconduct, (16) failure to maintain adequate internal control over financial reporting, and (17) climate change and natural disaster. For further information on the above, please refer to Mitsui’s Annual Securities Report.

    Forward-looking statements may be included in Mitsui’s Annual Securities Report and Quarterly Securities Reports or in its other disclosure documents, press releases or website disclosures. Mitsui undertakes no obligation to publicly update or revise any forward-looking statements.

                           
    4. Consolidated Financial Statements
    (1) Consolidated Balance Sheets
    (Millions of Yen)
    Assets
                            March 31,

    2013

      March 31,

    2014

     
     

    Current Assets:

    Cash and cash equivalents ¥ 1,425,174 ¥ 1,225,079
    Time deposits 4,740 5,617
    Marketable securities 367

    -

    Trade receivables:
    Notes and loans, less unearned interest 291,052 283,242
    Accounts 1,608,915 1,664,240
    Associated companies 138,588 87,141
    Allowance for doubtful receivables (16,463) (14,556)
    Inventories 746,584 702,555
    Advance payments to suppliers 135,120 124,666
    Deferred tax assets?current 15,644 12,667
    Derivative assets 61,081 89,199
    Other current assets 220,729 250,429
    Total current assets 4,631,531 4,430,279
    Investments and Non-current Receivables:
    Investments in and advances to associated

    companies

    2,325,255 2,729,476
    Other investments 816,343 950,480
    Non-current receivables, less unearned interest 523,904 538,333
    Allowance for doubtful receivables (37,362) (37,397)
    Property leased to others?at cost, less accumulated

    depreciation

    330,627 362,558
    Total investments and non-current receivables 3,958,767 4,543,450
    Property and Equipment?at Cost:
    Land, land improvements and timberlands 218,801 204,319
    Buildings, including leasehold improvements 442,255 487,625
    Equipment and fixtures 1,668,246 1,962,216
    Mineral rights 203,142 280,782
    Vessels 42,478 42,085
    Projects in progress 235,084 261,178

     

    Total 2,810,006 3,238,205
    Accumulated depreciation (1,239,736) (1,404,071)
    Net property and equipment 1,570,270 1,834,134
    Intangible Assets, less Accumulated Amortization 118,448 141,346
    Deferred Tax Assets?Non-current 31,538 35,637
    Other Assets 14,027 16,418
                                       
          Total     ¥ 10,324,581    

    ¥ 11,001,264

     
     
                         
    (Millions of Yen)
    Liabilities and Equity
                            March 31,

    2013

      March 31,

    2014

     
     
     
    Current Liabilities:
     
    Short-term debt ¥ 663,129 ¥ 519,220
    Current maturities of long-term debt 421,211 503,396
    Trade payables:
    Notes and acceptances 46,057 37,041
    Accounts 1,438,287 1,362,839
    Associated companies 71,272 96,425
    Accrued expenses:
    Income taxes 54,091 44,821
    Interest 16,985 17,081
    Other 80,971 95,689
    Advances from customers 98,470 101,678
    Derivative liabilities 83,940 100,618
    Other current liabilities 70,917 93,353
    Total current liabilities 3,045,330 2,972,161
    Long-term Debt, less Current Maturities 3,184,957 3,432,501
    Accrued Pension Costs and Liability for Severance

    Indemnities

    68,312 69,492
    Deferred Tax Liabilities?Non-current

    266,544

    309,309
    Other Long-Term Liabilities 319,334 349,735
    Equity:
    Common stock 341,482 341,482
    Capital surplus 429,828 418,796
    Retained earnings:
    Appropriated for legal reserve 69,653 75,073
    Unappropriated 2,405,008 2,737,792
    Accumulated other comprehensive income (loss):
    Unrealized holding gains on available-for-sale securities 135,832 164,896
    Foreign currency translation adjustments (94,912) (10,218)
    Defined benefit pension plans (74,124) (70,207)
    Net unrealized losses on derivatives (24,974) (15,060)
    Total accumulated other comprehensive (loss) income (58,178) 69,411
    Treasury stock, at cost (5,974) (56,140)
    Total Mitsui & Co., Ltd. shareholders' equity 3,181,819 3,586,414
     
    Noncontrolling interests 258,285 281,652
    Total equity 3,440,104 3,868,066
                                       
          Total                 ¥ 10,324,581     ¥ 11,001,264  
     
               
     
    (2) Statements of Consolidated Income and Comprehensive Income
     
    Statements of Consolidated Income
          (Millions of Yen)
    Year ended

    March 31, 2013

    Year ended

    March 31, 2014

     
                           
    Revenues:
    Sales of products ¥ 4,408,144 ¥ 5,216,933
    Sales of services 392,088 415,395
    Other sales 111,377 108,322
    Total revenues 4,911,609 5,740,650
     
    Total Trading Transactions:
    Year ended March 31, 2013, ¥ 10,049,637 million
    Year ended March 31, 2014, ¥ 11,165,660 million
     
    Cost of Revenues:
    Cost of products sold (3,901,272) (4,657,400)
    Cost of services sold (161,858) (162,873)
    Cost of other sales (58,040) (60,445)
    Total cost of revenues (4,121,170) (4,880,718)
    Gross Profit 790,439 859,932
    Other Expenses (Income):
    Selling, general and administrative 521,075 574,734
    Provision for doubtful receivables 14,761 9,982
    Interest expense (income) - net 1,186 (2,119)
    Dividend income (80,057) (120,510)
    Gain on sales of securities - net (44,905) (80,901)
    Gain on securities contributed to an employee retirement benefit trust - (2,119)
    Loss on write-down of securities 27,278 18,923
    Gain on disposal or sales of property and equipment - net (6,207) (15,747)
    Impairment loss of long-lived assets 12,342 6,453
    Impairment loss of goodwill - 4,071
    Other expenses - net 30,868 13,433
    Total other expenses (income) 476,341 406,200
    Income before Income Taxes and Equity in Earnings 314,098 453,732
    Income Taxes:
    Current 182,327 181,686
    Deferred (23,978) (972)
    Total income taxes 158,349 180,714
    Income before Equity in Earnings 155,749 273,018
    Equity in Earnings of Associated Companies - Net 176,226 173,730
     
    Net Income before Attribution of Noncontrolling Interests 331,975 446,748
      Net Income Attributable to Noncontrolling Interests   (24,049)     (24,587)  
      Net Income Attributable to Mitsui & Co., Ltd.     ¥ 307,926     ¥ 422,161  
     
    Statements of Consolidated Comprehensive Income
          (Millions of Yen)
    Year ended

    March 31, 2013

    Year ended

    March 31, 2014

     
                           
    Net Income before Attribution of Noncontrolling Interests ¥ 331,975 ¥ 446,748
    Other Comprehensive Income (Loss) (after income tax effect):
    Unrealized holding gains on available-for-sale securities 40,871 27,990
    Foreign currency translation adjustments 306,112 95,275
    Defined benefit pension plans (5,908) 4,114
    Net unrealized (losses) gains on derivatives (753) 9,933
    Total Other Comprehensive Income (Loss) (after income tax effect) 340,322 137,312
    Comprehensive Income before Attribution of Noncontrolling Interests 672,297 584,060
      Comprehensive Income Attributable to Noncontrolling Interests   (41,037)     (34,822)  
      Comprehensive Income Attributable to Mitsui & Co., Ltd.   ¥ 631,260     ¥ 549,238  
     
                           

    Notes:

    1.The Statements of Consolidated Income above are not reviewed by the auditors.

    2.The Statements of Consolidated Income above have been adjusted due to the adoption of ASC 810-10-65.

    3."Net Income attributable to Noncontrolling Interests" and "Comprehensive Loss (Income) attributable to Noncontrolling Interests" show the amounts deducted to calculate "Net Income attributable to Mitsui & Co., Ltd." and "Comprehensive (Loss) Income attributable to Mitsui & Co., Ltd.", respectively.

    4.Tax effects on investments in associated companies which were formerly included in "Equity in Earnings of Associated Companies - Net (After Income Tax Effect)" are included in "Income Taxes" for the three-month period ended December 31, 2009. At the same time, "Equity in Earnings of Associated Companies - Net (After Income Tax Effect)" are changed to "Equity in Earnings of Associated Companies - Net." Amounts for three-month period ended December 31, 2008 have been reclassified to conform to the current period presentation.

     

     
     
    (3) Statements of Changes in Consolidated Equity
     
      (Millions of Yen)
        Year ended

    March 31, 2013

    Year ended

    March 31, 2014

     
    Common Stock:
      Balance at beginning of year ¥ 341,482   ¥ 341,482  
      Balance at end of year ¥ 341,482   ¥ 341,482  
    Capital Surplus:
    Balance at beginning of year ¥ 430,491 ¥ 429,828
      Equity transactions with noncontrolling interest shareholders   (663)     (11,032)  
      Balance at end of year ¥ 429,828   ¥ 418,796  
    Retained Earnings:
    Appropriated for Legal Reserve:
    Balance at beginning of year ¥ 65,500 ¥ 69,653
      Transfer from unappropriated retained earnings   4,153     5,420  
      Balance at end of year ¥ 69,653   ¥ 75,073  
    Unappropriated:
    Balance at beginning of year ¥ 2,192,494 ¥ 2,405,008
    Net income attributable to Mitsui & Co., Ltd. 307,926 422,161
    Cash dividends paid to Mitsui & Co., Ltd. shareholders (91,248) (83,957)
    Dividends paid per share:
    Year ended March 31, 2013, ¥50.0
    Year ended March 31, 2014, ¥46.0
    Transfer to retained earnings appropriated for legal reserve (4,153) (5,420)
      Losses on sales of treasury stock   (11)     (0)  
      Balance at end of year ¥ 2,405,008   ¥ 2,737,792  
    Accumulated Other Comprehensive Income (Loss) (After Income Tax Effect):
    Balance at beginning of year ¥ (382,446) ¥ (58,178)
    Unrealized holding gains on available-for-sale securities 44,052 28,953
    Foreign currency translation adjustments 285,903 84,362
    Defined benefit pension plans (5,961) 3,917
    Net unrealized (losses) gains on derivatives (660) 9,845
      Equity transactions with noncontrolling interest shareholders   934     512  
      Balance at end of year ¥ (58,178)   ¥ 69,411  
    Treasury Stock, at Cost:
    Balance at beginning of year ¥ (6,203) ¥ (5,974)
    Purchases of treasury stock (15) (50,217)
      Sales of treasury stock   244     51  
      Balance at end of year ¥ (5,974)   ¥ (56,140)  
      Total Mitsui & Co., Ltd. shareholders' equity ¥ 3,181,819   ¥ 3,586,414  
     
                   
        Year ended

    March 31, 2013

    Year ended

    March 31, 2014

     
    Noncontrolling Interests:
    Balance at beginning of year ¥ 219,492 ¥ 258,285
    Dividends paid to noncontrolling interest shareholders (13,580) (18,981)
    Net income attributable to noncontrolling interests 24,049 24,587
    Unrealized holding losses on available-for-sale securities (after income tax effect) (3,181) (963)
    Foreign currency translation adjustments (after income tax effect) 20,209 10,913
    Defined benefit pension plans (after income tax effect) 53 197
    Net unrealized (losses) gains on derivatives (after income tax effect) (93) 88
      Equity transactions with noncontrolling interest shareholders and other   11,336     7,526  
      Balance at end of year ¥ 258,285   ¥ 281,652  
    Total Equity:
    Balance at beginning of year ¥ 2,860,810 ¥ 3,440,104
    Losses on sales of treasury stock (11) (0)
    Net income before attribution of noncontrolling interests 331,975 446,748
    Cash dividends paid to Mitsui & Co., Ltd. shareholders (91,248) (83,957)
    Dividends paid to noncontrolling interest shareholders (13,580) (18,981)
    Unrealized holding gains on available-for-sale securities (after income tax effect) 40,871 27,990
    Foreign currency translation adjustments (after income tax effect) 306,112 95,275
    Defined benefit pension plans (after income tax effect) (5,908) 4,114
    Net unrealized (losses) gains on derivatives (after income tax effect) (753) 9,933
    Sales and purchases of treasury stock 229 (50,166)
      Equity transactions with noncontrolling interest shareholders and other   11,607     (2,994)  
      Balance at end of year ¥ 3,440,104   ¥ 3,868,066  
     
         
    (4) Statements of Consolidated Cash Flows
     
     
      (Millions of Yen)
              Year ended

    March 31, 2013

    Year ended

    March 31, 2014

    Operating Activities:
    Net income before attribution of noncontrolling interests ¥ 331,975 ¥ 446,748
    Adjustments to reconcile net income before attribution of noncontrolling interests to net cash provided by operating activities:
    Depreciation and amortization 198,852 229,234
    Pension and severance costs, less payments 9,366 1,264
    Provision for doubtful receivables 14,761 9,982
    Gain on sales of securities - net (44,905) (80,901)
    Gain on securities contributed to an employee retirement benefit trust - (2,119)
    Loss on write-down of securities 27,278 18,923
    Gain on disposal or sales of property and equipment - net (6,207) (15,747)
    Impairment loss of long-lived assets 12,342 6,453
    Impairment loss of goodwill - 4,071
    Deferred income taxes (23,978) (972)
    Equity in earnings of associated companies, less dividends received (60,492) (20,544)
    Changes in operating assets and liabilities:
    Decrease (increase) in trade receivables 62,484 (9,331)
    Decrease in inventories 106,338 64,550
    Increase (decrease) in trade payables 11,331 (68,459)
      Other - net   (177,715)   (61,628)
        Net cash provided by operating activities   461,430   521,524
    Investing Activities:
    Net (increase) decrease in time deposits (382) 707
    Net increase in investments in and advances to associated companies (230,592) (217,554)
    Net decrease (increase) in other investments 9,155 (89,773)
    Net increase in long-term loan receivables (132,560) (23,341)
      Net increase in property leased to others and property and equipment (398,918)   (374,555)
        Net cash used in investing activities   (753,297)   (704,516)
    Financing Activities:

    Net increase (decrease) in short-term debt

    161,481 (109,780)
    Net increase in long-term debt 150,516 212,164
    Transactions with noncontrolling interest shareholders 921 (2,896)
    Purchases of treasury stock - net (13) (50,216)
     

    Payments of cash dividends

      (91,270)   (83,970)
        Net cash provided by (used in) financing activities   221,635   (34,698)
    Effect of Exchange Rate Changes on Cash and Cash Equivalents   64,294   17,595
    Net Decrease in Cash and Cash Equivalents (5,938) (200,095)
    Cash and Cash Equivalents at Beginning of Year   1,431,112   1,425,174
    Cash and Cash Equivalents at End of Year   ¥ 1,425,174   ¥ 1,225,079
     
    (5) Assumption for Going Concern: None
       
    (6) Basis ofConsolidated Financial Statements
     
    Scope of Subsidiaries and Associated Companies
     
    (1) Subsidiaries
     
    1) Overseas 200
     
    2) Japan 72
     
     
     
    (2) Associated Companies
     
    1) Overseas 116
     
    2) Japan 38
     
     

     

     

    A total of 320 subsidiaries and associated

    companies are excluded from the above. These

    include the companies which are sub-consolidated

    or accounted for under the equity method by

    other subsidiaries, other than trading subsidiaries.

     
     
    (7) Notes to Consolidated Financial Statements
    ?Operating Segment Information
                       
    Year ended March 31, 2013 (from April 1, 2012 to March 31, 2013) (As restated)
                                      (Millions of Yen)
              Iron & Steel Products   Mineral & Metal Resources   Machinery & Infrastructure   Chemicals   Energy   Lifestyle   Innovation & Corporate Development
     
    Revenues 214,059 629,262 376,246 747,589 1,281,177 815,070 121,113
    Gross Profit 42,218 161,379 106,762 70,677 186,459 111,677 31,602
    Operating Income (Loss) 2,656 124,491 (12,552) 7,409 135,314 (7,028) (27,090)
    Equity in Earnings of Associated Companies -Net 3,114 44,394 32,314 6,635 55,196 13,140 12,852
    Net Income (Loss) Attributable to Mitsui & Co., Ltd.   (3,805)   91,481   16,982   (1,500)   164,634   12,980   4,710
    Total Assets at March 31, 2013   542,339   1,764,310   1,589,480   723,356   1,721,327   1,350,263   649,937
                                       
              Americas   Europe,

    the Middle East and Africa

      Asia Pacific   Total   All Other   Adjustments

    and Eliminations

      Consolidated Total
     
    Revenues 547,154 95,118 82,922 4,909,710 1,902 (3) 4,911,609
    Gross Profit 66,009 15,646 10,513 802,942 935 (13,438) 790,439
    Operating Income (Loss) 11,428 (3,673) (5,936) 225,019 (1,289) 30,873 254,603
    Equity in Earnings of Associated Companies -Net 3,473 398 4,936 176,452 - (226) 176,226
    Net Income (Loss) Attributable to Mitsui & Co., Ltd.   12,405   (949)   27,536   324,474   6,134   (22,682)   307,926
    Total Assets at March 31, 2013   501,536   114,026   321,936   9,278,510   4,784,428   (3,738,357)   10,324,581
     
     
    Year ended March 31, 2014 (from April 1, 2013 to March 31, 2014)
                                      (Millions of Yen)
              Iron & Steel Products   Mineral & Metal Resources   Machinery & Infrastructure   Chemicals   Energy   Lifestyle   Innovation & Corporate Development
     
    Revenues 220,068 790,743 410,155 943,198 1,455,748 889,689 103,177
    Gross Profit 51,130 193,630 115,539 80,527 186,570 111,656 22,358
    Operating Income (Loss) 13,580 152,032 (8,742) 11,258 129,050 (17,798) (37,345)
    Equity in Earnings of Associated Companies -Net 5,393 42,846 16,824 8,637 60,208 19,788 7,371
    Net Income Attributable to Mitsui & Co., Ltd.   18,121   95,574   26,614   15,817   197,023   19,230   4,942
    Total Assets at March 31, 2014   561,076   2,010,055   1,866,515   732,438   2,131,675   1,434,669   559,887
                                       
              Americas   Europe,

    the Middle East and Africa

      Asia Pacific   Total   All Other   Adjustments

    and Eliminations

      Consolidated Total
     
    Revenues 699,737 117,176 109,079 5,738,770 1,884 (4) 5,740,650
    Gross Profit 77,482 22,104 12,469 873,465 794 (14,327) 859,932
    Operating Income (Loss) 11,858 724 (6,861) 247,756 (7,383) 34,843 275,216
    Equity in Earnings of Associated Companies -Net 6,521 1,455 4,522 173,565 365 (200) 173,730
    Net Income Attributable to Mitsui & Co., Ltd.   13,820   4,815   35,165   431,121   12,146   (21,106)   422,161
    Total Assets at March 31, 2014   564,044   109,452   339,923   10,309,734   5,034,651   (4,343,121)   11,001,264
     

    Notes:

    1.   “All Other” principally consisted of the Corporate Staff Unit which provides financing services and operations services to external customers and/or to the companies and associated companies. Total assets of “All Other” at  March 31, 2013 and 2014 consisted primarily of cash and cash equivalents and time deposits related to financing activities, and assets of  the Corporate Staff Unit and certain subsidiaries related to the above services.

    During the year ended March 31, 2014, a part of the Corporate Staff Unit which was formerly included in

    “Adjustments and Eliminations” was reclassified to “All Other”.

    This change has been made to the operating segment information for the year ended March 31, 2013, to conform to the current period presentation.

    2.  Transfers between operating segments are made at cost plus a markup.

    3.  Net Income (Loss) Attributable to Mitsui & Co., Ltd. of “Adjustments and Eliminations” includes income and expense items that are not allocated to specific reportable operating segments, and eliminations of intersegment transactions.

    4.  During the year ended March 31, 2014, Logistics infrastructure businesses including development and management of ports and airport terminal, advanced materials related businesses such as liquid crystal and electronic devices, and media related businesses such as TV shopping and broadcasting, all included in “Innovation & Corporate Development” segment, were transferred to “Machinery & Infrastructure” segment, “Chemicals” segment, and “Lifestyle” segment, respectively.

    In accordance with these changes, the operating segment information for the year ended March 31, 2013, has been restated to conform to the current period presentation.

    5.  During the year ended March 31, 2014, the steel scrap related businesses of Mitsui Bussan Metals Co., Ltd. in “Mineral & Metal Resources” segment were transferred to Mitsui & Co. Steel Ltd.  in “Iron & Steel Products” segment.

    In accordance with this change, the operating segment information for the year ended March 31, 2013, has been restated to conform to the current period presentation.

    6.  During the year ended March 31, 2014, “Innovation & Cross Function” changed its name to “Innovation & Corporate Development”.

    7.  During the year ended March 31, 2014, the coal related businesses, except for trading of thermal coal for power utilities, included in “Energy” segment, were transferred to “Mineral & Metal Resources” segment.

    In accordance with this change, the operating segment information for the year ended March 31, 2013, has been restated to conform to the current period presentation.

    8.  Operating Income (Loss) reflects the companies' a) Gross Profit, b) Selling, general and administrative expenses, and c) Provision for doubtful receivables as presented in the Statements of Consolidated Income.

     

     
           
    ?Net Income attributable to Mitsui & Co., Ltd. per share
     
    The following is a reconciliation of basic net income attributable to Mitsui & Co., Ltd. per share to diluted net income attributable to Mitsui & Co., Ltd. per share for the years ended March 31, 2013 and 2014:
     
    Year ended March 31, 2013(from April 1, 2012 to March 31, 2013)
    Net income

    (numerator)

      Shares

    (denominator)

      Per share amount
            Millions of Yen   In Thousands   Yen
     
    Basic Net Income Attributable to

    Mitsui & Co., Ltd. per Share:

    Net income attributable to Mitsui & Co., Ltd. 307,926 1,825,019 168.72
     
    Effect of Dilutive Securities:
    Adjustments of effect of dilutive securities of

    associated companies

    - -
             
    Diluted Net Income Attributable to

    Mitsui & Co., Ltd. per Share:

      Net income attributable to Mitsui & Co., Ltd.

    after effect of dilutive securities

      307,926     1,825,019     168.72
     
    Year ended March 31, 2014(from April 1, 2013 to March 31, 2014)            
    Net income

    (numerator)

      Shares

    (denominator)

      Per share amount
            Millions of Yen     In Thousands     Yen
     
    Basic Net Income Attributable to

    Mitsui & Co., Ltd. per Share:

    Net income attributable to Mitsui & Co., Ltd. 422,161 1,821,339 231.79
     
    Effect of Dilutive Securities:
    Adjustments of effect of dilutive securities of

    associated companies

    (13) -
             
    Diluted Net Income Attributable to

    Mitsui & Co., Ltd. per Share:

      Net income attributable to Mitsui & Co., Ltd.

    after effect of dilutive securities

      422,148     1,821,339     231.78
     
    ?Subsequent Events
     

    The Company cancelled its treasury stock as follows under Article 178 of the Companies Act, based on the

    resolution at the meeting of the Board of Directors held on March 26, 2014.

     

    1. Class of stock cancelled : Common shares of the Company

    2. Number of shares cancelled : 32,639,400 shares

    (1.8% of the total number of shares outstanding prior to cancellation)

    3. Date of cancellation : April 18, 2014

    4. Total number of treasury shares after cancellation : 1,796,514,127 shares

     

    Notes to Leases, Related party transactions, Tax effect accounting, Financial instruments, Securities, Derivative instruments, Pension cost and severance indemnities, Business combinations, Asset retirement obligations and others are omitted because there is less necessity for disclosure in the Flash Report.

     

     


    For diagrams omitted, please see our home page. (http://www.mitsui.com/jp/en/ir/library/meeting/__icsFiles/afieldfile/2014/05/07/en_143_4q_ta.pdf)




    Mitsui & Co Ltd

    Source: Mitsui & Co Ltd


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    Source: Business Wire (UK Regulatory)


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