Fact Book

Capital Investment, Depreciation and R&D Expenditures

(Years ended March 31)

(Millions of yen)
		2003	2004	2005	2006	2007
Capital investment :
	Purchases of property, plant and equipment shown as capital expenditures in the consolidated statements of cash flows	246,603	275,544	352,203	356,751	411,309
	Effect of timing difference between acquisition dates and payment dates	4,867	-4,253	22,050	-10,932	7,025
		251,470	271,291	374,253	345,819	418,334
Depreciation		283,434	253,762	287,400	275,213	280,177
R&D expenditures		551,019	579,230	615,524	564,781	578,087
R&D expenditures/Net sales		7.4%	7.7%	7.1%	6.3%	6.3%

The Company defines capital investment as purchases of property, plant and equipment on an accrual basis which reflects the effects of timing differences between acquisition dates and payment dates. The Company has included the information concerning capital investment because its management uses this indicator to manage its capital expenditures and it believes that such indicator is useful to investors to present accrual basis capital investments in addition to the cash basis information in the consolidated statements of cash flows. The above table shows a reconciliation of capital investment to purchases of property, plant and equipment shown as capital expenditures in the consolidated statements of cash flows.
Depreciation does not include amortization of intangibles.

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