I About this manual

This document is the owners manual for both RX-V630RDS and DSP-AX630SE. Since DSP-AX630SE does not incorporate a tuner, descriptions on tuning are not applicable for DSP-AX630SE. Illustrations for the RX-V630RDS are mainly used for explanations. y indicates a tip for your operation. Some operations can be performed by using either the buttons on the main unit or on the remote control. In cases when the button names differ between the main unit and the remote control, the button name on the remote control is given in parentheses. This manual is printed prior to production. Design and specifications are subject to change in part for the reason of the improvement in operativity ability, and others. In this case, the product has priority.
Manufactured under license from Dolby Laboratories. Dolby, Pro Logic, and the double-D symbol are trademarks of Dolby Laboratories.
DTS, ES and DTS Digital Surround are trademarks of Digital Theater Systems, Inc.
0102V630_1-8_EN(GB) 2 1/11/02, 7:40 PM

GETTING STARTED

Checking the package contents
Check your package to make sure it contains the following items.

Remote control

CODE SET
Batteries (4) (AAA, R03, UM-4)

TRANSMIT

SYSTEM

POWER TV CD

POWER AV MD/CD-R

STANDBY

AM loop antenna

D-TV/CBL

6CH INPUT
Indoor FM antenna (U.S.A., Canada, China, Korea and General models)

VCR2/DVR

TV VOL

VOLUME

TV MUTE

TV INPUT

ROCK CONCERT

ENTERTAINMENT

JAZZ CLUB

TV SPORTS

MONO MOVIE

MOVIE THEATER 1

MOVIE THEATER 2
Front VIDEO AUX jack cap 75-ohm/300-ohm antenna adapter (U.K. model) (Europe, U.K., Australia and Singapore models)

/DTS SUR.

SELECT

STEREO

EFFECT

LEVEL TITLE

PRESET/CH

SET MENU

A/B/C/D/E

DISPLAY

RETURN

AUDIO DISC SKIP

Installing batteries in the remote control
Insert the batteries in the correct direction by aligning the + and marks on the batteries with the polarity markings (+ and ) inside the battery compartment.

A/B/C/D/E Selects preset station groups A to E.
DSP-AX630SE NEXT Selects the SET MENU mode.

a PRESET/TUNING (EDIT)

Switches the function of PRESET/TUNING l / h between selecting a preset station number and tuning (the colon (:) turns on or off). This button is also used to exchange the assignment of two preset stations with each other.

r BASS

Adjusts the low-frequency response for the main left and right channels. Turn right to increase or turn left to decrease the lowfrequency response.
s TUNING MODE (AUTO/MANL MONO)
Switches the tuning mode between automatic and manual.

t TREBLE

Adjusts the high-frequency response for the main left and right channels. Turn right to increase or turn left to decrease the highfrequency response.
d MEMORY (MANL/AUTO FM) Stores the current station in the memory. f FM/AM
Switches the reception band between FM and AM.

y VIDEO AUX jacks

Inputs for audio and video signals from a portable external source (game console, etc.). Set the input source to V-AUX to enjoy source signals from these jacks. When the VIDEO AUX jacks on the front panel are not used, you can attach the provided front VIDEO AUX jack cap as shown in the illustration. When the cap is not attached, be sure retain it carefully.

VID EO X AU

ADDITIONAL INFORMATION APPENDIX

OP AU DIO R

L EO VID IDEO SV
0102V630_1-8_EN(GB) 5 1/11/02, 7:40 PM
This section describes the remote control controls and their functions. Make sure that the AMP mode is selected before starting operation. See REMOTE CONTROL FEATURES on pages 48 to 50.

1 Infrared window

Outputs infrared control signals. Aim this window at the component you want to operate.

2 CODE SET

Used when setting up the manufacturer code (see page 49).

3 Input selector buttons

Select the input source and set the remote control to operate the selected source component.
DVD D-TV/CBL V-AUX 6CH INPUT VCR 1 VCR2/DVR

4 DSP program

Select DSP programs for the AMP position. Press a button repeatedly to select a DSP program within that group.

5 LEVEL

Selects the effect speaker channel to be adjusted.

6 Multi control section

Used when changing the setting and to implement the settings.

7 TEST

Outputs the test tone to adjust the speaker levels.

8 TRANSMIT indicator

DIGITAL INPUT jacks (pages 13-16) Audio component jacks (page 16) Antenna input terminals (page 17)
I Connecting to digital jacks
This unit has digital jacks for direct transmission of digital signals through either coaxial or fiber optic cables. You can use the digital jacks to input PCM, Dolby Digital and DTS bitstreams. To enjoy multi-channel sound track of DVD software, etc. with DSP effect, you need to make digital connection. All digital input jacks are acceptable for 96-kHz sampling digital signals.
The OPTICAL jacks on this unit conform to the EIA standard. If you use a fiber optic cable that does not conform to this standard, this unit may not function properly.
Speaker terminals (pages 10-11)
Video component jacks (pages 14-15)
R DIGITAL INPUT AUDIO R AUDIO L OUT CD CD R L VCR 2 /VDR IN TUNER AM ANT OUT (REC) MD /CD-R IN (PLAY) OUT GND VCR 1 DVD IN 75 UNBAL. D-TV /CBL COMPONENT VIDEO PR/CR PB/CB Y VIDEO S VIDEO VIDEO MAIN SPEAKERS REAR CENTER L CENTER
6CH INPUT jacks (page 18) DIGITAL OUTPUT jack (page 16)
SUBWOOFER OUTPUT jack (page 11) OUTPUT jacks (page 18)

AC OUTLETS (page 19)

0103V630_9-18_EN(GB) 13 1/11/02, 7:40 PM
Connecting video components
Refer to the connection examples on the next page.
If your video component has an S-video output or component video output, connect the S-video signal output jack on the component to the S VIDEO jack or connect the component video signal output jacks on the component to the COMPONENT VIDEO jacks. The AUDIO jacks are available for a video component which does not have optical digital output jack. However, multichannel reproduction cannot be obtained with audio signals input from AUDIO jacks.

I Types of video jacks

There are three types of video jacks as follows:

COMPONENT VIDEO

S VIDEO VIDEO

1 VIDEO jack

I Connecting a game console or camcorder
Connect the optical digital audio signal output jack on your video component to the OPTICAL jack on the front panel and connect video signal output jack on the component to the VIDEO jack on the front panel.

When AUTO is selected, this unit automatically determines the type of signal. If this unit detects a Dolby Digital or DTS signal, the decoder automatically switches to the appropriate setting. When playing a disc encoded with Dolby Digital or DTS on some LD or DVD players, the sound output delays for a moment when playback resumes after a search because the digital signal is selected again. When playing a LD source that has not been digitally recorded, the sound may not be output for some LD players. In this case, set the input mode to ANALOG.
0105V630_23-28_EN(GB) 25 1/11/02, 7:40 PM
Selecting a sound field program
You can enhance your listening experience by selecting a DSP program. For details about each program, see pages 29 to 33.
After selecting the desired program, press the same button repeatedly to select the desired sub-program if available. Example: Pressing MOVIE THEATER 1 repeatedly switches the sub-program between Sci-Fi and Spectacle.

PROGRAM l / h

Program name
VCR2/DVR VCR1 V-AUX D-TV/CBL DVD MD/CD-R TUNER CD

DIGITAL

MOVIE THTR 1

TUNER SLEEP

DGTLzSci-Fi

Sub-program name

C R RR

LFE RL

Press one of the DSP program buttons on the remote control to select the desired program. The name of the selected program appears on the front panel display.
There are 9 programs with sub-programs available with this unit. However, the selection depends on the input signal format and not all sub-programs can be used with all input signal formats. The digital sound field processor cannot be used when a source connected to the 6CH INPUT jacks of this unit is selected or when 96-kHz sampling digital signals are input to this unit. The acoustics of your listening room affect the DSP program. Minimize the sound reflections in your room to maximize the effect created by the program. When you select an input source, this unit automatically selects the last DSP program used with that source. When you set this unit in the standby mode, the current source and DSP program are memorized and are automatically selected when you turn on the power again. If a Dolby Digital or DTS signal is input when the input mode is set to AUTO, the DSP program (No. 79) automatically switches to the appropriate decoding program. When a monaural source is being played with PRO LOGIC/ Normal or PRO LOGIC/Enhanced, or PRO LOGIC Movie, no sound will be heard from the main speakers and the rear speakers. Sound can only be heard from the center speaker. (If 1A CENTER on the SET MENU is set to NON, the center channel sound is output from the main speakers.)

L C R RR

INTRODUCTION PREPARATION

I Recreating a sound field
Recreating the sound field of a concert hall or an opera house requires localizing the virtual sound sources in your listening room. The traditional stereo system that uses only two speakers is not capable of recreating a realistic sound field. YAMAHAs DSP requires four effect speakers to recreate sound fields based on the measured sound field data. The processor controls the strength and delay time of the signals output from the four effect speakers to localize the virtual sound sources and fully encompass the listener.

Hi-Fi DSP programs

The following list gives you a brief description of the sound fields produced by each of the DSP programs. Keep in mind that most of these are precise digital recreations of actual acoustic environments.
No. 1 Program CONCERT HALL Features A large round concert hall with a rich surround effect. Pronounced reflections from all directions emphasize the extension of sounds. The sound field has a great deal of presence, and your virtual seat is near the center, close to the stage.
This is the sound field at stage front in The Bottom Line, a famous New York jazz club, that seats up to 300 people. Its wide left to right seating arrangement offers a real and vibrant sound. The ideal program for lively, dynamic rock music. The data for this program was recorded at LAs hottest rock club. The listeners virtual seat is at the center-left of the hall. This program recreates the acoustic environment of a lively disco in the heart of a big city. The sound is dense and highly concentrated. It is also characterized by a high-energy, immediate sound.

ENTERTAINMENT/ Disco

ENTERTAINMENT/ 6ch Stereo
Using this program increases the listening position range. This is a sound field suitable for background music at parties, etc.
0106V630_29-33_EN(GB) 29 1/11/02, 7:41 PM

CINEMA-DSP

Sound design of CINEMA-DSP
Filmmakers intend for the dialog to be located right on the screen, the effect sound a little farther back, the music spread even farther back, and the surround sound around the listener. Of course, all of these sounds must be synchronized with the images on the screen. CINEMA-DSP is an upgraded version of YAMAHA DSP specially designed for movie soundtracks. CINEMA-DSP integrates the DTS, Dolby Digital, and Dolby Pro Logic surround sound technologies with YAMAHA DSP sound field programs to provide a surround sound field. It recreates comprehensive movie sound design in your audio room. In CINEMA-DSP sound field programs, YAMAHAs exclusive DSP processing is added to the Main left and right, and Center channels, so the listener can enjoy realistic dialogue, depth of sound, smooth transition between sound sources, and a surround sound field that goes beyond the screen. When a DTS or Dolby Digital signal is detected, the CINEMA-DSP sound field processor automatically chooses the most suitable sound field program for that signal.

Features This program creates the extremely wide sound field of a 70-mm movie theater. It precisely reproduces the source sound in detail, making both the video and the sound field incredibly real. This is ideal for any kind of video source encoded with Dolby Surround, Dolby Digital or DTS (especially large-scale movie productions). This program clearly reproduces dialog and sound effects in the latest sound form of science fiction films, thus creating a broad and expansive cinematic space amid the silence. You can enjoy science fiction films in a virtual-space sound field that includes Dolby Surround, Dolby Digital and DTS-encoded software employing the most advanced techniques. This program is ideal for precisely reproducing the sound design of the newest 70-mm and multichannel soundtrack films. The sound field is made to be similar to that of the newest movie theaters, so the reverberations of the sound field itself are restrained as much as possible. This program is for reproducing sounds from 70-mm and multichannel soundtrack films, and is characterized by a soft and extensive sound field. The presence sound field is relatively narrow. It spatially spreads all around and toward the screen, restraining the echo effect of conversations without losing clarity. This program ideally simulates the multi-surround speaker systems of the 35-mm film theaters. Dolby Pro Logic decoding, Dolby Digital decoding or DTS decoding and digital sound field processing create precise effects without altering the original sound orientation. The surround effects produced by this sound field wrap around the viewer naturally from the back to the left and right, and toward the screen.

Sci-Fi

Adventure

General

Enhanced Mode
I For audio-video sources: No. 4 to 6
No. 4 Program ENTERTAINMENT/ Game ENTERTAINMENT/ Concert Video 5 TV SPORTS Features
This program adds a deep and spatial feeling to video game sounds.
This program adds a deep and spatial feeling to concert video sounds.
With this program, you can enjoy watching various TV programs such as news, variety shows, music programs or sports programs. In a stereo broadcast of a sports game, the commentator is oriented at the center position, and the shouts and the atmosphere in the stadium spread on the surround side, while their spread to the rear is properly restrained. This program is provided for reproducing monaural video sources (such as old movies). The program produces the optimum reverberation to create sound depth by using only the presence sound field.

Press FM/AM to select the FM band.
Automatic preset tuning options You can select the preset number from which this unit will store FM stations and/or begin tuning toward lower frequencies. After pressing MEMORY in step 3: 1. Press A/B/C/D/E and PRESET/TUNING l / h to select the preset number under which the first station will be stored. Automatic preset tuning will stop when stations have all been stored up to E8. 2. Press PRESET/TUNING (EDIT) to turn off the colon (:) and then press PRESET/TUNING l to begin tuning toward lower frequencies. Memory back-up The memory back-up circuit prevents the stored data from being lost even if this unit is set in the standby mode, the power cord is disconnected from the AC outlet, or the power supply is temporarily cut due to power failure. However, if the power is cut for more than one week, the preset stations may be cleared. If so, store the stations again.

Lights up

Press and hold MEMORY (MANL/AUTO FM) for more than 3 seconds. The preset number and the MEMORY and AUTO indicators flash. Then, after about 5 seconds, automatic preset tuning begins from the frequency currently displayed toward the higher frequencies.

MEMORY MAN'L/AUTO FM

AUTO MEMORY
When automatic preset tuning is completed, the front panel display shows the frequency of the last preset station.
0107V630_34-41_EN(GB) 35 1/11/02, 7:42 PM
I Manually presetting stations
You can also store up to 40 stations (8 stations x 5 groups) manually.
Press PRESET/TUNING l / h to select a preset station number (1 to 8) while the MEMORY indicator is flashing. Press h to select a higher preset station number. Press l to select a lower preset station number.

TUNED MEMORY

C3:AM 63O kHz
Tune in to a station. See page 34 for tuning instructions.
VCR2/DVR VCR1 V-AUX D-TV/CBL DVD MD/CD-R TUNER

63O kHz

When tuned in to a station, the front panel display shows the frequency of received station.

EDIT E1-A5

Shows the exchange of stations has been completed.
0107V630_34-41_EN(GB) 37 1/11/02, 7:42 PM
RDS (Radio Data System) is a data transmission system by FM stations in many countries. RDS data contains various information such as PS (Program Service name), PTY (Program Type), RT (Radio Text), CT (Clock Time), EON (Enhanced Other Networks), etc. The RDS function is carried out among the network stations.

Description of RDS data

This unit can receive, PS, PTY, RT, CT, and EON data when receiving RDS broadcasting stations.

Changing the RDS mode

The four modes are available in this unit for displaying RDS data. When an RDS station is being received, PS, PTY, RT and/or CT mode indicators that correspond to the RDS data services offered by the station light up on the front panel display. Press RDS MODE/FREQ repeatedly to change the display mode among the RDS data offered by the transmitting station in the order shown below.
I PS (Program Service name) mode:
The name of the RDS station being received is displayed.
I PTY (Program Type) mode:
There are 15 program types to classify RDS stations.
NEWS AFFAIRS INFO SPORT EDUCATE DRAMA CULTURE SCIENCE VARIED POP M ROCK M M.O.R. M LIGHT M CLASSICS OTHER M News Current affairs General information Sports Education Drama Culture Science Light entertainment Pops Rock Middle-of-the-road music (easy-listening) Light classics Serious classics Other music

PS mode

PTY mode

RT mode

CT mode

RDS mode OFF

When an RDS station is being received, do not press RDS MODE/FREQ until one or more RDS mode indicators light up on the front panel display. If you press the button before the indicators light up on the front panel display, the mode cannot be changed. This is because this unit has not yet received all of the RDS data on the station. RDS data not offered by the station cannot be selected. The RDS data service cannot be utilized by this unit if the received signal is not strong enough. In particular, the RT mode requires a large amount of data to be received, so it is possible that the RT mode may not be displayed even if other RDS modes (PS, PTY, etc.) are displayed. RDS data cannot sometimes be received under poor reception conditions. If so, press TUNING MODE so that the AUTO indicator goes off from the front panel display. Although the reception mode is changed to monaural by this operation, when you change the display to RDS mode, RDS data may be displayed. If the signal strength is weakened by external interference during the reception of an RDS station, the RDS data service may be cut off suddenly and.WAIT will appear on the front panel display.

I RT (Radio Text) mode:

Information about the program (such as the title of the song, name of the singer, etc.) on the RDS station being received is displayed by a maximum of 64 alphanumeric characters, including the umlaut symbol. If other characters are used for RT data, they are displayed with under-bars.

I CT (Clock Time) mode:

The current time is displayed and updated every minute. If the data are accidentally cut off, CT WAIT may appear.
I EON (Enhanced Other Networks):

Refer to following page.

0107V630_34-41_EN(GB) 38 1/11/02, 7:42 PM

PTY SEEK function

If you select the desired program type, this unit automatically searches all preset RDS stations that are broadcasting a program of the required type.

EON function

This function uses the EON data service on the RDS station network. If you simply select the desired program type (NEWS, INFO, AFFAIRS or SPORT), this unit automatically searches for all preset RDS stations that are scheduled to broadcast a program of the required type and switches from the station being currently received to the new station when the broadcasts starts.
Press PTY SEEK MODE to set this unit in the PTY SEEK mode. The program type of the station being received or NEWS flashes on the front panel display.
This function can only be used when an RDS station that offers the EON data service is being received. When such a station is being received, the EON indicator lights up on the front panel display.
Press PRESET/TUNING l / h to select the desired program type. The selected program type appears on the front panel display.
Make sure that the EON indicator lights up on the front panel display. If the EON indicator does not light up, tune in to another RDS station so that the EON indicator lights up. Press EON repeatedly to select the desired program type (NEWS, INFO, AFFAIRS or SPORT). The selected program type name appears on the front panel display.
Press PTY SEEK START to begin searching all preset RDS stations. The selected program type flashes and the PTY HOLD indicator lights up on the front panel display while searching for stations.

SET MENU +

Press NEXT repeatedly until the menu disappears or simply press PROGRAM l / h to exit the SET MENU.
Memory back-up The memory back-up circuit prevents the stored data from being lost even if this unit is in the standby mode. However, if the power cord is disconnected from the AC outlet, or the power supply is cut for more than one week, the stored data will be lost. If so, adjust the items again.
0108V630_42-47_EN(GB) 43 1/11/02, 7:42 PM
I 1B MAIN (main speaker mode)
Choices: LARGE, SMALL LARGE Select this if you have large main speakers. The entire range of the main left and right channel signal is directed to the main left and right speakers. SMALL Select this if you have small main speakers. The lowfrequency signals (90 Hz and below) of the main channel are directed to the speakers selected with 1E BASS.
I 1D REAR CT (rear center speaker mode)
By adding a rear center speaker to your speaker configuration, this unit can provide more realistic frontto-back and transitions. Choices: LRG (large), SML (small), NON (none) LRG Select this if you have a large rear center speaker. The entire range of the rear center channel signal is directed to the rear center speaker. SML Select this if you have a small rear center speaker. The low-frequency signals (90 Hz and below) of the rear center channel are directed to the speakers selected with 1E BASS. NON Select this if you do not have a rear center speaker. All of the rear center channel signal are directed to the rear left and right speakers.
I 1C REAR LR (rear speaker mode)
Choices: LRG (large), SML (small), NON (none) LRG Select this if you have large rear left and right speakers or if a rear subwoofer is connected to the rear speakers. The entire range of the rear channel signal is directed to the rear left and right speakers. SML Select this if you have small rear left and right speakers. The low-frequency signals (90 Hz and below) of the rear channel are directed to the speakers selected with 1E BASS. NON Select this if you do not have rear speakers.

0109V630_48-53_EN(GB) 50 1/11/02, 7:42 PM
ADJUSTING THE LEVEL OF THE EFFECT SPEAKERS
You can adjust the output level of each effect speaker (center, rear left and right, rear center and subwoofer) while listening to a source. Adjustment should be made with the remote control.
Press j / i to adjust the speaker output level. The control range for the center or rear left and right speakers is from +10 dB to 10 dB. The control range for the subwoofer is from 0 dB to 20 dB.
When the speaker output modes for 1A CENTER and 1C REAR LR are set to NON, and 1E BASS to MAIN, the output level of those speakers cannot be adjusted because there is no sound coming from these speakers. When you adjust the output level with LEVEL, the settings you made with the test tone will be changed. We recommend adjusting the speakers by following the steps described in Using the test tone on pages 21 and 22.

I For 6ch Stereo

You can adjust the volume level for each channel in 6channel stereo mode. Control range: 0 to 100% CT level (Center level) RL level (Rear left level) RR level (Rear right level) RC level (Rear center level)
Press LEVEL repeatedly to select the speaker(s) you want to adjust. Each time you press LEVEL, the selected speaker changes and appears on the front panel display as follows: center, rear right, rear center, rear left and subwoofer.
Center speaker output level
Select 6ch Stereo. Press u / d repeatedly to select the speaker(s) you want to adjust. Press j / i to adjust the speaker output level.
Rear right speaker output level
Rear center speaker output level Rear left speaker output level
Memory back-up The memory back-up circuit prevents the stored data from being lost even if this unit is in the standby mode. However, if the power cord is disconnected from the AC outlet, or the power supply is cut for more than one week, the stored data will be lost. If so, set the output level again.

Subwoofer output level

Once you press LEVEL, you can also select the speaker(s) to be adjusted by pressing d / u.
0109V630_48-53_EN(GB) 51 1/11/02, 7:42 PM

ADJUSTING THE DELAY TIME

You can adjust the time difference between the beginning of the sound from the main speakers and the beginning of the sound effect from the rear speakers. The larger the value, the later the sound effect is generated. The delay time can be individually adjusted to all DSP programs. The following table shows factory-set delay time.
Program CONCERT HALL JAZZ CLUB ROCK CONCERT DISCO GAME CONCERT VIDEO TV SPORTS MONO MOVIE 70 mm SPECTACLE DGTL SPECTACLE DTS SPECTACLE Spectacle EX/ES 70 mm SCI-FI Sci-Fi EX/ES DGTL SCI-FI DTS SCI-FI 70 mm ADVENTURE DGTL ADVENTURE DTS ADVENTURE Adventure EX/ES 70 mm GENERAL DGTL GENERAL DTS GENERAL General EX/ES PRO LOGIC/NORMAL DOLBY DIGITAL/NORMAL DTS DIGITAL SUR./NORMAL Dolby D EX/DTS ES PRO LOGIC/ENHANCED DOLBY DIGITAL/ENHANCED DTS DIGITAL SUR./ENHANCED Enhanced EX/ES PRO LOGIC Movie PRO LOGIC Music Preset value (ms) 15 5

I General

Problem Cause Remedy Refer to page
This unit fails to turn on when STANDBY/ ON (or SYSTEM POWER) is pressed, or enters in the standby mode soon after the power has been turned on.
The power cord is not connected or the plug is not completely inserted. The IMPEDANCE SELECTOR switch on the rear panel is not fully set to either the left or right position. The protection circuitry has been activated.
Firmly connect the power cord.
Set the switch fully to the left or right position when this unit is in the standby mode.
Make sure all speaker wire connections on this unit and on all speakers are secure and that the wire for each connection does not touch anything other than its respective connection. Set this unit in the standby mode, disconnect the power cord, plug it back in after 30 seconds, then start operating. Connect the cables properly. If the problem persists, the cables may be defective. Select an appropriate input source with INPUT l / h or 6CH INPUT (or the input selector buttons). Secure the connections. Select the main speakers with SPEAKERS A and/or B. Turn up the volume. Press MUTE or any operation buttons of this unit to cancel a mute and adjust the volume. Play a source whose signals this unit can reproduce.

10, 11

This unit has been exposed to a strong external electric shock (such as lightning and strong static electricity). No sound. Incorrect input or output cable connections. An appropriate input source has not been selected. The speaker connections are not secure. The main speakers to be used have not been selected properly. The volume is turned down. The sound is muted.

10, 11 23

Digital signals which this unit cannot reproduce are being input to this unit by playing a CD-ROM, etc. The picture does not appear. The output and input for the picture are connected to different types of video jacks.
Make connections using the same type of video jacks (S VIDEO, VIDEO (composite), or COMPONENT VIDEO) for both the input and output.

14, 15

0110V630_54-60_EN(GB) 54 1/11/02, 7:43 PM

Problem

Remedy

Refer to page

The sound suddenly goes off.
The protection circuit has been activated because of a short circuit, etc.

YAMAHA CORPORATIONConsolidated Basis

YAMAHA CORPORATION

Interim Flash Report Consolidated Basis
Results for the fiscal year 2003 interim period ended September 30, 2002 November 15, 2002
Company name: Code number: Address of headquarters: Representative director: Telephone: Stock listings: YAMAHA CORPORATION 7951 10-1, Nakazawa-cho, Hamamatsu, Shizuoka 430-8650, Japan Shuji Ito +Tokyo Stock Exchange (First Section), Osaka Securities Exchange (First Section), Nagoya Stock Exchange (First Section) The accounting methods used in this report are not consistent with U.S. standard accounting methods.
For further information, please contact: Tokihisa Makino Date of the interim meeting of the Board of Directors: November 15, 2002
1. RESULTS FOR THE FY2003 INTERIM PERIOD (April 1, 2002 to September 30, 2002)
Figures of less than 1 million have been omitted.
(1)Consolidated Operating Results

Net sales

Millions of yen (% change from the previous fiscal year)

Operating income

Recurring profit

FY2003 interim period

(Ended Sept. 30, 2002)

253,763 248,778 504,406

2.0% (1.0)

13,105 7,729 11,043

69.5 % (38.6)

14,238 7,520 7,680

89.3 % (46.2)

FY2002 interim period

(Ended Sept. 30, 2001)

FY2002

(Ended March 31, 2002)

Net income

(% change from the previous fiscal year)

Net income per share

Net income per share after full dilution

Millions of yen

10,075 7,234 (10,274)

39.3% (27.9)

48.86 35.03 (49.75)

44.24 33.22

Notes: 1. Equity in net income of affiliates: FY2003 interim period ended September 30, 2002 FY2002 interim period ended September 30, 2001
3,468 million 2,309 million
FY2002 ended March 31, 2002 2,993 million 2. Average number of outstanding shares during the year (consolidated): FY2003 interim period ended September 30, 2002 206,199,869 shares FY2002 interim period ended September 30, 2001 206,520,824 shares FY2002 ended March 31, 2002 206,508,465 shares 3. Changes in method of accounting: NONE 1
(2) Consolidated Financial Data

Total assets

Shareholders equity
Shareholders equity ratio
Shareholders equity per share

523,866 520,848 509,663

206,019 195,086 201,965

39.3 % 37.5 39.6

999.26 944.63 978.15
Note: Number of outstanding shares at the end of the year (consolidated): FY2003 interim period as of September 30, 2002 206,171,257 shares FY2002 interim period as of September 30, 2001 206,521,043 shares FY2002 as of March 31, 2002 206,477,225 shares
(3)Consolidated Cash Flows
Cash flows from operating activities
Cash flows from investing activities
Cash flows from financing activities
Cash and cash equivalents at end of period

(300) (172) 29,016

(11,441) (8,420) (10,437)

11,402 13,140 (12,880)

39,825 37,853 40,571
(4) Matters Related to Consolidated Companies and Companies Accounted for Using the Equity Method
Number of consolidated subsidiaries: 84 Number of non-consolidated subsidiaries accounted for using the equity method: 0 Number of affiliates accounted for using the equity method: 2
(5) Changes in the Status of Consolidated Companies and Companies Accounted for Using the Equity Method
Consolidated companies: Number of companies newly consolidated: Number of companies removed from consolidation: Equity method: Number of companies newly accounted for using the equity method: Number of companies removed from the equity method: 0 1
2. FORECASTS OF RESULTS FOR FY2003 (April 1, 2002 March 31, 2003)

(b) The Lifestyle-Related and Leisure group is facing severe market conditions. As a result, YAMAHA will focus on improving the groups revenues and bolstering its operating base through a process of selective resource allocation. In the lifestyle-related products segment, YAMAHA is endeavoring to establish a high-value added business model for the refurbishing market and to boost revenues by reducing costs through the integration of design, manufacture, construction, and distribution. In the recreation segment, the Company is making an effort to increase the profits generated by each management subsidiary through its respective resort and to ensure the thoroughness of cash flow management.
(c) In the Electronic Parts and Materials group, YAMAHA will leverage the technologies developed in its
core businesses and draw on all its business strengths to achieve balanced growth. YAMAHA will reform its manufacturing structure to strengthen its operating base in the electronic metals business, reinforce the superiority of its magnesium parts technologies and manufacturing expertise in the FA and metallic molds business, and boost manufacturing efficiency and product quality in the interior automotive components and fittings business. At the same time, the Company will endeavor to increase revenues in each of these business areas.
2. To strengthen the Groups consolidated management, YAMAHA is working to rebuild its central information system and promote the implementation of global production strategies, procurement systems, and quality management systems. In addition, the Company is strengthening its patent procurement system and adopting patenting strategies adapted to IT and digitization, establishing an efficient distribution system and effective mechanisms for managing its operational infrastructure and the Groups internal funds, and promoting law-abiding management practices across the entire Group.
Through the implementation of the measures outlined above, YAMAHA is aiming for a 9% return on equity over the medium-to-long term.
3. BUSINESS RESULTS (1) Fiscal 2002 Summary
During the interim period under review, the Japanese economy remained flat despite strong consumer spending in certain areas, and housing investment and private-sector capital investment continued to decline. Although there was moderate recovery in overseas economies, uncertainty over the future heightened. Against this backdrop, YAMAHA has moved forward with and is entering the second year of its medium term management plan Creating Kando 21. Working toward corporate growth, the Company is aggressively promoting technological development, launching new products, and actively investing in growth markets by enhancing its distribution network and establishing a holding company in China. Furthermore, in the mediarelated business, YAMAHA is endeavoring to expand the potential of its Internet business in such areas as customer-oriented product and service development. During the term under review, overall sales of musical instruments increased as strong sales overseas compensated for the drop in sales in Japan, and, in the electronic equipment and electronic metal products segment, sales of semiconductor and lead frame materials grew. However, sales in the AV/IT segment fell. As a result, net sales amounted to 253,763 million, up 2.0% year on year. Of this, domestic sales amounted to 152,209 million, up 2.6% year on year, and overseas sales increased 1.1%, to 101,553 million. Regarding income, recurring profit totaled 14,238 million, up 89.3% year on year, and net income for the interim period under review amounted to 10,075 million, up 39.3% year on year.

Sales of golf products climbed, owing to the popularity of new SECRET01 series products and sales of FA products and metallic molds were given a substantial boost by demand for magnesium molds for mobile phones. The automobile industry was between model changes during the period under review, resulting in reduced sales of interior automotive components. Due to these factors, segment sales amounted to 10,343 million, a 7.4% increase year on year, and operating income totaled 487 million, compared with an operating loss of 94 million for the same period of the previous year.

(3) Results by Region

In Japan, sales totaled 158,727 million, up 1.5% year on year, and operating income rose 58.2%, to 11,272 million. In North America, sales increased 4.3%, to 44,018 million, and operating income rose 58.3%, to 2,137 million. In Europe, sales increased 5.0%, to 35,465 million, and operating income totaled 972 million, compared with a 260 million operating loss for the same period of the previous fiscal year. In the Asia, Oceania, and Other regions, sales fell 5.2%, to 15,552 million, and operating income decreased 24.8%, to 1,417 million.
(4) Forecast for the Entire Fiscal Year
YAMAHA anticipates harsh operating conditions in the latter half of the fiscal year, owing to factors that include the sluggish domestic market and heightened uncertainty over the future of the North American market. However, in semiconductors, overseas sales of sound chips for mobile phones are expected to grow. Thus, for the fiscal year ending March 31, 2003, YAMAHA projects consolidated net sales of 530.0 billion, a 5.1% increase from fiscal 2002, consolidated recurring profits of 25.0 billion, a 225.5% increase, and consolidated net income of 18.5 billion, compared with a net loss of 10.2 billion for fiscal 2002.

(5) Dividends

At a board meeting held on November 15, 2002, it was decided that interim dividends would be raised 1 per share, to 5 per share in line with improved business performance. In addition, initial year-end dividend forecasts were revised upward 1, from 4 per share, to 5 per share.
4. FINANCIAL POSITION (1) Interim Period Cash Flows
During the term under review, cash and cash equivalents (hereinafter cash) decreased 831 million from the previous term, to 39,825 million, compared with a 4,103 million increase in the previous interim period. CASH FLOWS FROM OPERATING ACTIVITIES Income before income taxes and minority interests amounted to 12,249 million, compared with income of 8,214 million in the previous interim period. Net cash used in operating activities grew to 300 million, compared with 172 million used during the previous interim period, mainly owing to an increase in accounts receivable. CASH FLOWS FROM INVESTING ACTIVITIES Cash used in investing activities totaled 11,441 million, compared with 8,420 million in the previous interim period, due to higher capital investment and the purchase of investment securities.

Millions of yen FY2002 interim period (as of Sept. 30, 2001)
FY2002 (as of Mar. 31, 2002)
42,521 63,038 9,129 38,723 3,120 9,587 166,120
42,129 71,997 9,127 37,029 3,537 10,351 174,173
36,880 47,871 4,363 41,987 3,237 10,158 144,498
24,317 13,311 14,207 55,37,201 1,952 147,355 313,476 4,371
24,317 14,242 65,39,858 3,160 147,522 321,696 4,065
24,317 19,615 14,638 59,38,472 1,508 158,486 302,984 4,712
28,533 26,924 168,398 15,870 1,615 (35,130) (193) 206,019 523,866
28,533 26,924 8,118 175,974 (6,802) (37,659) (2) 195,086 520,848
28,533 26,924 16,482 157,(28,280) (49) 201,965 509,663
(2) Consolidated Statements of Operations
FY2003 interim period FY2002 interim period FY2002 (Apr. 1, 2002 (Apr. 1, 2001 (Apr. 1, 2001 Sept. 30, 2002) Sept. 30, 2001) Mar. 31, 2002) Millions of yen % Millions of yen % Millions of yen % Net sales Cost of sales: Gross profit Unrealized profit Total gross profit Selling, general and administrative expenses: Sales commissions Transport expense Advertising and sales promotion expenses Various reserves Personnel expenses Rent Depreciation and amortization Other Total selling, general and administrative expenses Operating income Non-operating income: Interest received Dividends received Equity in earnings of unconsolidated subsidiaries and affiliates Other Total non-operating income Non-operating expenses: Interest paid Cash discounts Other Total non-operating expenses Recurring profit Other profit: Gain on sale of fixed assets Reversal of allowances Gain on sale of investment securities Total other profit Other loss: Loss on removal of fixed assets Loss on revaluation of investment securities Loss on sale of stocks in subsidiaries Loss on revaluation of capital in subsidiaries Loss on sale of investment securities Loss on revaluation of stocks in subsidiaries Special retirement benefits Total other loss Income before income taxes and minority interests Current income taxes (benefit) Deferred income taxes (benefit) Minority interest Net income

12,249 9,454 1,(3,661) (341) 1,(3,468) 222 (60) 578 (11,142) (7,893) 6,278 (3,590) 1,(1,014) (1,080) (300) 49 (8,101) 1,518 (3,348) 149 (1,895) (94) 338 (58) (11,441) 14,952 1,070 (2,677) 16 (774) (89) (825) (268) 11,402 (492) (831) 40,39,825
8,214 9,(236) (2,070) (480) 1,(2,309) (1,479) (22) 448 7,801 (5,659) (9,514) (3,821) 2,(1,461) (1,654) (172) (9,362) 208 (818) 1,549 (637) (8,420) 12,222 6,688 (4,471) (826) (463) (8) 13,140 (444) 4,103 32,725 1,025 37,853
(5,784) 18,(507) 14,(8,210) (736) 2,(2,993) (3,694) 27 (99) 1,771 18,794 18,532 (15,715) (5,058) 33,(2,918) (2,171) 29,016 (14,876) 888 (858) 4,074 (714) 1,292 (242) (10,437) (13,241) 8,178 (5,665) (1,652) (468) (31) (12,880) 1,122 6,821 32,725 1,025 40,571
(5) Basic Items for the Preparation of the Consolidated Financial Statement
1. Scope of Consolidation Consolidated subsidiaries: 84 corporations During the fiscal 2003 interim period, a total of five subsidiaries, (two overseas subsidiaries and three Japanese subsidiaries) were brought into the consolidated group. In addition, three overseas subsidiaries were removed from the consolidated group. The names of major consolidated subsidiaries are listed in 1. The YAMAHA Group. The effect of the assets, net sales, net income/loss and retained earnings of Yamaha Life Service Co., Ltd., and other non-consolidated subsidiaries on the consolidated financial results was immaterial. 2. Application of Equity Method Of Yamaha Life Service Co., Ltd., and other non-consolidated subsidiaries, Yamaha Motor Co., Ltd. and one other affiliate are accounted for by the equity method. During the interim period under review, one overseas affiliate was removed from the equity method. As for Yamaha Life Service Co., Ltd., and other non-consolidated subsidiaries and YamahaOlin Metal Corporation, and other affiliates to which the equity method has not been applied, the effect of their net income/loss and retained earnings on the consolidated financial results was immaterial.
[Change in Accounting Method] At Yamaha Motors Co., Ltd., an affiliate accounted for by the equity method, the excess of costs over the net assets of acquired subsidiaries has been amortized within 20 years using the straight-line method, based on a review of the collectibility of individual investments. However, effective the interim period ended September 30, 2002, the Company has decided to amortize such costs fully when acquired. This change is due to Yamaha Motors implementation of a new three-year medium-term management plan (April 2002 March 2005), focusing on such management issues as Improving the profitability of existing businesses and Solidifying the foundation of businesses in Asian countries. This move was made to correspond to such changes in market structure as intensifying global competitiveness in the motorcycle business and other businesses, and to avoid collectibility risk arising from future fluctuations in the investment market, especially in strategically targeted areas. Thus, Yamaha Motor aims to further strengthen its financial soundness. As a result of this change in accounting method, equity in earnings of unconsolidated subsidiaries and affiliates, income before income taxes and net income each decreased 2,507 million compared with what would have been recorded under the previous method. 3. Fiscal Year of Consolidated Subsidiaries Settlement days for consolidated subsidiaries, with the exception of the following 19 companies, are all the same as that for the Company. P.T. Yamaha Indonesia P.T. Yamaha Music Indonesia (Distributor) P.T. Yamaha Music Manufacturing Indonesia P.T. Yamaha Music Manufacturing Asia

P.T. Yamaha Musical Products Indonesia P.T. Yamaha Electronics Manufacturing Indonesia Yamaha de Mexico, S. A. de C. V. Yamaha Electronics Manufacturing (M) Sdn, Bhd. Tianjin Yamaha Electronic Musical Instruments, Inc. Guanzhou YamahaPearl River Piano Inc. Xiaoshan Yamaha Musical Instrument Co., Ltd. Yamaha Music & Electronics (China) Co., Ltd. Yamaha Music (Asia) PTE. LTD. (and 6 other corporations)
The financial statements of the above 19 companies, all of whose interim year-end is June 30, are included in the consolidated financial statements on the basis of their fiscal year after making appropriate adjustments for significant transactions during the period from July 1, 2002 to the date of the Companys interim year-end, September 30, 2002. 4. Accounting Standards a) Basis and Method of Evaluation of Significant Assets

Marketable securities

Securities to be held until maturity: At amortized cost (straight-line method)
Other marketable securities

With market value:

At fair value (changes in fair value are recorded in a separate component of shareholders equity in an amount of net of tax, and the periodic average method is used to calculate the original cost)
Without market value: At cost, determined by the periodic average method

Derivatives

All fair value

Inventories

Inventories of the Company and its domestic consolidated subsidiaries are stated principally at the lower of cost or market, cost being determined by the last-in, first-out method. Inventories of the Company's foreign consolidated subsidiaries are stated principally at the lower of cost or market, cost being determined by the moving average method.
b) Method of Depreciation

Tangible fixed assets

Mainly calculated by the declining-balance method except that certain consolidated subsidiaries employ the straight-line method at rates based on the estimated useful lives of the respective assets. Useful lives of tangible fixed assets are as follows: Buildings: 31-50 years (attachment facilities are mainly 15 years) Structures: 10-30 years Machinery and Equipment: 4-11 years Tools, furniture and fixtures: 5-6 years (metallic molds are mainly two years)
c) Accounting for Reserves and Benefits
Allowance for doubtful accounts
The amount of allowance for normal accounts is determined based on past write-off experience, and the amount of allowance for doubtful accounts is determined based on a review of the collectibility of individual receivables.
Accrued employees retirement benefits
Accrued employees retirement benefits are provided on an accrual basis based on the projected retirement benefit obligation and the pension fund assets calculated using various actuarial assumptions as of the end of the interim period. Prior service cost is being amortized as incurred by the straight-line method over periods (principally 10 years) which are shorter than the average remaining years of service of the employees. Actuarial gain and loss are amortized in the year following the year in which the gain or loss is recognized primarily by the straight-line method over periods (principally 10 years) which are shorter than the average remaining years of service of the employees.

Directors retirement benefits
Directors retirement benefits are provided at 100% of the amount that would be required as of the balance sheet date based on the Company s internal rules.
d) Foreign Currency Transactions Monetary assets and liabilities of the Company and its domestic subsidiaries denominated in foreign currencies are translated at the current exchange rates in effect at each balance sheet date. The resulting foreign exchange gains or losses are recognized as other income or expenses. Assets and liabilities of the foreign consolidated subsidiaries are translated at the current exchange rates in effect at each balance sheet date and revenue and expense accounts are translated at the average rate of exchange in effect during the year. Translation adjustments are presented as a component of shareholders equity and minority interests.
e) Accounting for Lease Transactions Lease agreements are generally accounted for as operating leases, except that lease agreements which stipulate the transfer of ownership of the leased assets to the lessee are accounted for as finance leases.

f) Hedge Accounting

1. Method of Hedge Accounting
Translation differences arising from forward foreign exchange contracts with respect to receivables and payables denominated in foreign currencies are accounted for using the allocation method. Anticipated transactions denominated in foreign currencies designated as hedging instruments are accounted for using deferral hedge accounting.
2. Hedged Items and Hedging Instruments

Hedged items

Forward foreign exchange contracts, purchased options with foreign currency-denominated put and yen-denominated call

Hedging instruments

Receivables and payables denominated in foreign currencies and anticipated transactions denominated in foreign currencies

3. Hedging Policy

The Company and consolidated subsidiaries enter into forward foreign exchange contracts and currency options as hedging instruments within the limit of actual foreign transactions to reduce risk arising from future fluctuations of foreign exchange rates with respect to export and import transactions in accordance with the internal management rules of each company.

4. Assessment of Effectiveness for Hedging Activities
The Company and its consolidated subsidiaries do not make an assessment of effectiveness for hedging activities because the anticipated cash flows fixed by hedging activities and avoidance of market risk is clear; therefore, there is no need to evaluate such effectiveness.
g) Accounting for Consumption Tax Income and expenses are recorded net of consumption tax. 5. Scope of Cash Equivalents in Consolidated Statements of Cash Flows All highly liquid investments with a maturity of three months or less when purchased and which are readily convertible into cash and are exposed to insignificant risk of changes in value are considered cash equivalents.
(6) Change in Presentation
Consolidated Balance Sheets Effective the interim period ended September 30, 2002, the Company separately presented Deferred income taxes on land revaluation, which had been included in Other fixed liabilities in the long-term liabilities for the interim period ended September 30, 2001. Consolidated Statement of Cash Flows Effective the interim period ended September 30, 2002, the Company transferred Proceeds from resort member deposits and Repayments of resort member deposits to cash flows from financing activities, which had been included in Other in cash flows from operating activities for the interim period ended September 30, 2001.
(7) Additional Information
Accounting for Treasury Stock and the Reversal of Legal Reserve, etc. Effective the interim period ended September 30, 2002, the Company adopted applied the Accounting Standard for the Treasury Stock and the Reversal of Legal Reserve, etc. (Corporate Accounting Standard, sub-paragraph 1). The effect of this change to the profits and losses for this interim period is immaterial. In accordance with the revision of the Regulation for the presentation of Interim Financial Statements, Shareholders equity in the Consolidated Balance Sheets and the Consolidated Statements of Retained Earnings for the interim period were presented under the revised regulation.

(8) Other Notes

Notes to the Consolidated Balance Sheets
At September 30, 2002 At September 30, 2001 At March 31, 2002
1. Accumulated Depreciation 2. Mortgaged Assets Of cash and bank deposits Of marketable securities Of tangible fixed assets Of investments and other assets Total 3. Contingent Liabilities 4. Discount on Export Bills Receivable 5. Deferred Hedge Gains(Losses) Deferred hedge gains Deferred hedge losses Net deferred hedge gains(losses) Notes to the Statements of Income

219,106 million 30 million 682 million 13,292 million 1,764 million 15,769 million 107 million 1,335 million 21 million 298 million (276) million
221,095 million 30 million 739 million 16,662 million 1,807 million 19,239 million 50 million 1,270 million 126 million 79 million 47 million
226,483 million 30 million 60 million 13,651 million 2,423 million 16,165 million 129 million 1,386 million 1 million 100 million (99) million
FY2003 interim period ended Sept. 30, 2002
FY2002 interim period ended Sept. 30, 2001
FY2002 ended March 31, 2002
Significant components of reversal of allowances: Allowance for doubtful accounts 525 million Accrued employees retirement benefits 3,492 million Directors retirement benefits 94 million Notes to the Statements of Cash Flows
44 million 2,261 million 74 million
million 4,755 million 201 million
Reconciliation between Cash and Cash Equivalents and Cash and Bank Deposits in the Consolidated Balance Sheets: Cash and bank deposits 40,314 million 38,181 million 41,074 million Time deposits with a maturity of more (488) million (327) million (502) million than three months Cash and cash equivalents 39,825 million 37,853 million 40,571 million
Segment Information 1. Business Segments (FY2003 interim period ended September 30, 2002)
Electronic equipment and metal products Recreation (Millions of yen) Eliminations or unallocated amounts Consolidated

Musical instruments

Lifestylerelated products
Sales to external customers Intersegment sales or transfers Total sales Operating expenses Operating income (loss)

Notes:

146,175 146,175 140,225 5,950
38,482 38,482 37,436 1,045

23,574 23,574 23,025 548

24,885 1,732 26,618 20,716 5,901
10,301 10,301 11,130 (828)
10,343 253,763 10,343 9,1,732 255,495 242,390 13,105

(1,732) (1,732) (1,732)

253,763 253,763 240,657 13,105
1. Business Sectors: Divided into the categories of musical instruments, AV/IT products, lifestyle-related products, electronic equipment and metal products, recreation and other based on consideration of similarities of product type, characteristics and market, etc. 2. Major products and services of each business segment are shown in 1. The Yamaha Group on page 3.
(FY2002 interim period ended September 30, 2001) Electronic equipment and metal products Recreation (Millions of yen) Eliminations or unallocated amounts Consolidated
144,650 144,650 140,804 3,845
41,573 41,573 40,374 1,198
23,795 23,795 22,788 1,007
18,370 1,421 19,792 17,176 2,615

504,406 206,902 711,309 700,222 11,087
(206,902) (206,902) (206,859) (43)
3. Overseas Sales (FY2003 interim period ended September 30, 2002)
(Millions of yen) North America Europe Asia, Oceania and other areas Total
Overseas sales Net sales % of net sales

44,633 17.6%

35,576 14.0%

21,344 8.4%

101,553 253,763 40.0%
(FY2002 interim period ended September 30, 2001) (Millions of yen) North America Europe Asia, Oceania and other areas Total

43,019 17.3%

33,872 13.6%

23,514 9.5%

100,406 248,778 40.4%
(FY2002 ended March 31, 2002) (Millions of yen) North America Europe Asia, Oceania and other areas Total

93,524 18.5%

73,458 14.6%

47,472 9.4%

214,455 504,406 42.5%
Lease Transactions [Lessee] 1. Finance Lease Transactions Other than Those that Transfer Ownership of the Leased Assets to the Lessee a) Acquisition costs, accumulated depreciation and net book value
FY2003 interim period (as of September 30, 2002) Tools and Total equipment Other FY2002 interim period (as of September 30, 2001) Tools and Total equipment Other (Millions of yen) FY2002 (as of March 31, 2002) Tools and Total equipment Other
Acquisition costs Accumulated depreciation Net book value

2,803 1,453 1,350

4,123 2,282 1,840

4,202 2,630 1,571

5,234 3,330 1,904

4,195 2,620 1,574

5,355 3,397 1,957
Note: Acquisition costs include interest expenses since the balance of future minimum lease payments accounts for only a small percentage of tangible fixed assets as of the balance sheet date.
b) Future minimum lease payments
FY2003 interim period (as of September 30, 2002) FY2002 interim period (as of September 30, 2001) (Millions of yen) FY2002 (as of March 31, 2002)
Due within one year Due over one year Total

735 1,105 1,840

875 1,082 1,957
Note: Future minimum lease payments include interest expenses since the balance of future minimum lease payments accounts for only a small percentage of tangible fixed assets as of the balance sheet date.
c) Lease payments and depreciation
FY2003 interim period (ended September 30, 2002) FY2002 interim period (ended September 30, 2001) (Millions of yen) FY2002 (ended March 31, 2002)
Lease payments Depreciation

536 536

555 555

1,124 1,124

d) Depreciation of leased assets Assuming that the residual values are nil, depreciation of leased assets is calculated over the relevant lease periods using the straight-line method.

2. Operating Lease Transactions a) Future minimum lease payments
[Lessor] 1. Finance Lease Transactions Other than Those that Transfer Ownership of the Leased Assets to the Lessee a) Acquisition costs, accumulated depreciation and net book value

5,157 3,433 1,724

5,009 3,326 1,682

5,127 3,469 1,657

b) Future minimum lease receivables

963 1,902 2,865

1,005 1,941 2,947

962 1,831 2,793

Note: Future minimum lease receivables includes interest income since the balance of future minimum lease receivables and estimated residual values accounts for only a small percentage of trade receivables as of the balance sheet date.
c) Lease receivables and depreciation
Lease receivables Depreciation

575 298

579 387

1,173 606

Marketable Securities 1. Held-to-Maturity Securities at Market Value
(Millions of yen) FY2003 interim period FY2002 interim period FY2002 (as of September 30, 2002) (as of September 30, 2001) (as of March 31, 2002) Carrying Estimated Unrealized Carrying Estimated Unrealized Carrying Estimated Unrealized gain value fair value gain value fair value gain value fair value
Government bonds Corporate bonds Others Total

270 1,642 1,750 3,662

274 1,652 1,781 3,707

69 2,032 1,850 3,952

71 2,055 1,883 4,010

270 1,931 1,449 3,652

272 1,945 1,467 3,686
2. Available-for-Sales Securities at Market Value
(Millions of yen) FY2003 interim period FY2002 interim period FY2002 (as of September 30, 2002) (as of September 30, 2001) (as of March 31, 2002) Acquisition Carrying Unrealized Acquisition Carrying Unrealized Acquisition Carrying Unrealized cost value cost value gain cost value gain gain
Stocks Bonds Corporate bonds Others Total
18,542 21,51 18,42 21,411

2,(8) 2,774

34,541 27,822 (6,718) 34,45 27,(4) (6,715)
19,609 21,49 19,45 21,164

1,(3) 1,462

3. Book Value of Securities without Market Value
Other securities Unlisted securities (except for over-thecounter traded securities)

Note: The Company recorded an impairment loss of 1,066 million in Available-for-sales securities at market value during the interim period ended September 30, 2002. The impairment loss in such securities is recognized when market value at the period end declines 30% or more of the carrying cost, except when it is anticipated that the market value is recoverable.
Derivative Transactions Derivative transactions, other than receivables and payables denominated in foreign currencies, were removed from the scope or disclosure because they apply to hedge accounting.