<PAGE>
THE TOTAL NUMBER OF PAGES CONTAINED IN THIS DOCUMENT IS 57
FORM 6-K
--------
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Report of Foreign Issuer
Pursuant to Rule 13a-16 or 15d-16 of the
Securities Exchange Act of 1934
For the month of May 2000
NIPPON TELEGRAPH AND TELEPHONE CORPORATION
(Translation of registrant's name into English)
3-1, OTEMACHI 2-CHOME
CHIYODA-KU, TOKYO 100-8116, JAPAN
(Address of principal executive offices)
Indicate by check mark whether the registrant files or will file annual
reports under cover of Form 20-F or Form 40-F.
Form 20-F X Form 40-F ___
---
Indicate by check mark whether the registrant by furnishing the information
contained in this Form is also thereby furnishing the information to the
Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.
Yes ____ No X
---
If "Yes" is marked, indicate below the file number assigned to the
registrant in connection with Rule 12g3-2(b): 82-____________.
<PAGE>
2
ANNOUNCEMENT OF FINANCIAL RESULTS FOR FISCAL YEAR ENDED MARCH 31, 2000
On May 26, 2000, the registrant filed with the Tokyo Stock Exchange and
other stock exchanges in Japan information as to the registrant's financial
condition and results of operations at and for the fiscal year ended March 31,
2000. Attached hereto is a copy of a press release dated May 26, 2000 pertaining
to such financial condition and results of operations, as well as forecasts for
the registrant's operations for the fiscal year ending March 31, 2001. The
financial information included in the press release was prepared on the basis of
accounting principles generally accepted in Japan and, accordingly, will not be
directly comparable to the financial information to be included in the
registrant's Annual Report on Form 20-F for the fiscal year ended March 31,
2000, which information will be prepared on the basis of accounting principles
generally accepted in the United States.
The earning projections for the fiscal year ending March 31, 2001 included
in the attachment contain forward-looking statements. The registrant desires to
qualify for the "safe harbor" provisions of the Private Securities Litigation
Reform Act of 1995, and consequently is hereby filing cautionary statements
identifying important factors that could cause the registrant's actual results
to differ materially from those set forth in the attachment.
The registrant's earning projections are based on a series of projections
and estimates regarding the economy and the telecommunications industry in Japan
in general. The projections and estimates regarding the telecommunications
industry may be affected by the pricing of services, the effects of competition,
and the success of new products, services and new business.
No assurance can be given that the registrant's actual results will not
vary significantly from the projected earnings.
<PAGE>
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
NIPPON TELEGRAPH AND TELEPHONE
CORPORATION
By /s/ KAZUTO TSUBOUCHI
-------------------------
Name: Kazuto Tsubouchi
Title: Senior Manager
Investor Relations Group
Department IV
Date: May 26, 2000
<PAGE>
May 26, 2000
FOR IMMEDIATE RELEASE
NTT Announces Financial Results
for Fiscal Year Ended March 31, 2000
1. STATUS OF THE CORPORTE GROUP
The NTT Group (NTT and its affiliates) consists of the Nippon Telegraph and
Telephone Corporation (NTT) and its 284 subsidiaries and 95 affiliated
companies. The principal businesses of the NTT Group cover regional, long-
distance and international communications services, mobile communication
services, and data communication services.
The business results of consolidated subsidiaries and their respective positions
in the NTT Group are as follows:
(1) Regional Communications Businesses
----------------------------------
The principal elements in this business consist of intra-prefectural
communications services and related ancillary services pertaining to domestic
communications services.
(Consolidated Subsidiaries)
Nippon Telegraph and Telephone East Corporation (NTT East), Nippon Telegraph and
Telephone West Corporation (NTT West).
(2) Long-Distance and International Communications Businesses
---------------------------------------------------------
The principal elements in this business consist of inter-prefectural
communications services, international communications services and ancillary
services pertaining to international communications services.
(Consolidated Subsidiaries)
NTT Communications Corporation, NTT America, Inc., NTT Rocky, Inc.,
NTTA&T Investment, Inc., ntta.com, inc., TELETECHNO, Inc., Milletechno, Inc.,
NTTA&A Investment, Inc., NTT MULTIMEDIA COMMUNICATIONS LABORATORIES, Inc.,
Autoweb Communications, Inc., NTT AUSTRALIA PTY. Ltd., NTT Worldwide
Telecommunications Corporation, NTT EUROPE LTD., NTT FRANCE SA, NTT Deutschland
1
<PAGE>
GmbH, NTT MSC SDN. BHD., NTT SINGAPORE PTE. LTD., NTT (HONG KONG) LIMITED,
NTT Taiwan Ltd., NTT Korea Co., Ltd., NTT do Brazil Participacoes Ltda.
(3) Mobile Communications Businesses
--------------------------------
The principal elements in this business consist of mobile telephone services,
car telephone services, PHS services, paging services and related ancillary
services.
(Consolidated Subsidiaries)
NTT DoCoMo, Inc., NTT DoCoMo Hokkaido, Inc., NTT DoCoMo Tohoku, Inc., NTT DoCoMo
Tokai, Inc., NTT DoCoMo Hokuriku, Inc., NTT DoCoMo Kansai, Inc., NTT DoCoMo
Chugoku, Inc., NTT DoCoMo Shikoku, Inc., NTT DoCoMo Kyushu, Inc.
(Note: The above nine companies are those renamed on April 1, 2000.)
(4) Data Communication Businesses
-----------------------------
The principal elements in this business consist of systems integration services
and network system services.
(Consolidated Subsidiary)
NTT Data Corporation
(5) Other Businesses
----------------
Nippon Telegraph and Telephone Corporation
(Consolidated Subsidiaries)
(Yen) Other Affiliates of the Holding Company
NTT Power and Building Facilities Inc., NTT Urban Development Co., NTT
Communicationware Corporation, NTT Leasing Co., Ltd., NTT Auto Leasing Co.,
Ltd., NTT Finance Japan Co.,Ltd, NTT Software Corporation., NTT Electronics
Corporation, NTT Advanced Technology
Corporation, NTT Intelligent Technology Co., Ltd.
2
<PAGE>
(Yen) Regional Communications Businesses Support Group
NTT-ME Hokkaido Co., Ltd., NTT-ME Tohoku Co., Ltd., NTT-ME Corporation, NTT-ME
Tokai Co., Ltd., NTT-ME Hokuriku Co., Ltd., NTT-ME Kansai Co., Ltd., NTT-ME
Chugoku Co., Ltd., NTT-ME Shikoku Co., Ltd., NTT-ME Kyushu Co., Ltd., NTT-Do
Inc., NTT Directory Services Co., NTT Teleca Corporation.
(Yen) Long-Distance and International Businesses Support Group
NTT World Engineering Marine Corporation
Group organizational chart appears on the following page.
3
<PAGE>
<TABLE>
---------------------------------
* Consolidated subsidiaries
---------------------------------
ORGANIZATIONAL CHART OF THE NTT GROUP
- ------------------------------------------------------------------------------------------------------------------------------------
Customer
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------- -------------------------------- ----------------------------------- ------------------------
<S> <C> <C> <C>
Regional Communications Long-Distance and International Mobile Communications Data Communication
Businesses Communications Businesses Businesses Businesses
* NTT East * NTT Communications * NTT DoCoMo * NTT Data
* NTT West * 20 international companies * eight regional DoCoMo companies
- ------------------------------- -------------------------------- ----------------------------------- ------------------------
- -----------------------------------------------------------------------------------------------------------------------------------
Other Businesses
- ------------------------------- ------------------------------- ----------------------------- ------------------------
Regional Communications Support Long-Distance and International Mobile Communications Support Data Communications
Group Communications Support Group Group Support Group
+ Engineering Businesses + Internet Related Businesses + Engineering Businesses + SE Services
* NTT-ME NTTPC Communications DoCoMo Engineering NTT System Technologies
* eight regional NTT-ME NTT Satellite Communications, DoCoMo Mobile, and others NTT System Service,
companies, and other and others + Others and others
+ Telephone Directory Businesses + Others DoCoMo Service + Network Services
* NTT Directory Service * NTT World Engineering Marine, DoCoMo Support NTT Data Financial
NTT Business Information and others Nippon Senpaku Tsushin, and Dream Net, and others
Service, and others others + Others
+ Telemarketing Businesses NTT DATA Tokyo SMS
NTT Telemarketing NTT DATA Customer
NTT Dynamic Telema, and others Service, and others
+ Internet Related Businesses
Plala Networks, and others -------------------------------- --------------------------------- -------------------------
+ Others
* NTT Teleca, and others
- ----------------------------------
- ----------------------------------
Other Affiliates of the Holding
Company
+ Engineering Businesses
* NTT Power and Building Facilities,
and others
+ Real Estate Businesses
* NTT Urban Development, and others
+ SI and Information Processing
Businesses
* NTT Communicationware
Nippon Information and
Communication, and others
+ Financing Businesses
* NTT Leasing
* NTT Auto Leasing, and others
+ Advanced Technologies
Development Businesses
* NTT Software
* NTT Electronics, and others
+ Others
NTT Business Associe
NTT Advertising, and others
- ----------------------------------
</TABLE>
------------------------------------------
Nippon Telegraph and Telephone Corporation
------------------------------------------
<PAGE>
2. BUSINESS OPERATION PLAN
(1) Basic Business Operation Plan
-----------------------------
NTT is facing a rapidly changing business environment as a result of growing
competition in the information communications market. In response to these
developments and pursuant to the Law Amending Part of the Nippon Telegraph and
Telephone Corporation Law, NTT underwent reorganization and divestiture as
approved by the 14th Regular General Shareholders' Meeting convened on June 29,
1999. Thereafter, on July 1, 1999, NTT was launched as a holding company with
two wholly owned regional operating companies (NTT East and NTT West), and one
wholly owned long-distance operating company (NTT Communications Corporation).
The NTT Group believes this reorganization provides it with an excellent
opportunity to transform itself into a "Global Information Sharing Corporate
Group" poised to capitalize on newly emerging business opportunities. As such,
each of the member companies of the NTT Group is committed to pursuing greater
management efficiency while acting independently to take the initiative in
developing new business opportunities in the field of information
communications. These lines of action are based on the following strategic
principles: (1) To focus on network-based "information communication
businesses" and undertake to "develop information sharing markets" including
platforms, contents and terminals. (2) To undertake worldwide information
sharing businesses by providing comprehensive and seamless services in fixed,
mobile, and data and IP formats. (3) To fully utilize the advantages of
assigning R&D functions to the holding company and other synergy effects to
maximize the value of the entire Group and the development of its businesses.
(2) Basic Principles concerning Profit Allocation
---------------------------------------------
NTT believes it is very important for it to reinforce its financial standing and
to serve the best interests of shareholders over the long run. As such, NTT has
adopted as its basic principle the payment of appropriate dividends while acting
4
<PAGE>
to secure necessary levels of internal reserves.
Such internal reserves will be utilized to reinforce NTT's financial standing.
3. BUSINESS RESULTS
(1) Results for the Fiscal Year Ending March 31, 2000
-------------------------------------------------
During the term under review, severe conditions persisted in the Japanese
economy with private demand showing continued weakness. However, signs of a
mild recovery were seen toward the end of the term as the decline in plant and
equipment investment appeared to be bottoming out.
In the telecommunications markets, the forces of globalization and
standardization gained further momentum and important structural changes were in
evidence with the ongoing process of amalgamation and alliance among existing
carriers. A dramatic increase in Internet users was observed during the period
and mobile computing reached a higher stage of market penetration. As a result
of these developments, demand for data communication services expanded at an
accelerated pace. Telecommunications carriers are now faced with the urgent
need to respond to the requirements of high-volume and high-speed systems, while
at the same time developing a full roster of diversified services available at
inexpensive rates.
In this business environment, in response to surging demand for Internet use,
the former NTT and its Group companies had committed themselves to providing
highly convenient services by promoting diversification of services and fee
structures from April to June 1999 prior to the reorganization in July 1999.
Since the reorganization, the three companies which acquired the NTT
operations--NTT East, NTT West and NTT Communications--have undertaken this
endeavor.
Pursuant to these developments, NTT's business results for the fiscal year
ending March 31, 2000 were as follows. Consolidated operating revenue
5
<PAGE>
amounted to 10,421.1 billion yen (up 7.1% from the previous year), consolidated
recurring profit amounted to 825.0 billion yen (up 27.2% from the previous
year), and consolidated net loss reached 67.8 billion yen. NTT's net change in
retained earnings, net of tax adjustments from the previous year, for the fiscal
year ending March 31, 2000, were 557.2 billion yen (down 7.5% from the previous
year).
With respect to cash flow activities during the fiscal year ending March 31,
2000, NTT obtained from its operating activities cash in the amount of 2,779.8
billion yen, and spent 2,963.6 billion yen on investment activities and 380.0
billion yen on financing activities. As a result, at the end of the fiscal
year, NTT had cash and cash equivalents in the amount of 1,155.2 billion yen.
In accordance with NTT's above-stated basic principle, a cash dividend of 2,500
yen per share is scheduled to be paid to shareholders for the fiscal year ending
March 31,2000. Including the interim dividend paid, this will bring the sum of
the annual dividend payments to 5,000 yen per share.
The business results of the principal member companies of the NTT Group during
the term under review are as follows:
Nippon Telegraph and Telephone Corporation (Holding Company)
- -------------------------------------------------------------
NTT functions as a pure holding company to the NTT Group and exercises its
rights as shareholder in accordance with the criteria of whether the activities
of individual Group companies are in harmony with the overall business
objectives of the Group and whether appropriate initiative is being taken in
these directions. In the general shareholders' meetings of the NTT Group
companies held in June 1999, NTT exercised its rights as shareholder by voting
in support of the profit allocation proposals of the individual companies which
it judged to be appropriate in view of the previous term's financial standing,
internal reserve conditions, and business operating conditions of these
companies. As a result, NTT received a total of 13.8 billion yen in dividends.
During the term under review, NTT endeavored to improve the management
6
<PAGE>
efficiency and synergy effects within the NTT Group by providing advice and
intermediary services to individual companies. For instance, NTT provided
leadership and coordination for developing more sophisticated networks and
expanded services, for Y2K compliance, and for preparing contingency responses
in case of natural disaster and other emergency situations. NTT also provided
advice and intermediary services in the areas of developing core human resources
and improved operational efficiency. Furthermore, NTT supported the Group
companies in their efforts to develop new businesses. In particular, NTT has
been advising the NTT East and the NTT West on the development of universal
services. During the term under review, NTT received a total amount of 20.5
billion yen in payment for these services.
Pursuant to these activities, NTT's results for the fiscal year ending March 31,
2000 were as follows: Operating revenues amounted to 1,696.7 billion yen (down
72.4% from the previous year), recurring profit reached to 117.5 billion yen
(down 50.5% from the previous year), and net income amounted to 97.0 billion yen
(down 74.9% from the previous year).
Nippon Telegraph and Telephone East Corporation and Nippon Telegraph and
- ------------------------------------------------------------------------
Telephone West Corporation
- --------------------------
NTT East and NTT West are responsible for intra-prefectural communication
services. Competition in the intra-prefectural communication markets has been
intensified by advances in GC interconnection and the entry of new enterprises
providing high-speed Internet access services.
In view of this situation, the regional operating companies are endeavoring to
provide high-quality and stable universal services. They have improved their
competitive positions and customer services by offering a wide range of
discounted services in order to stabilize and reinforce their business
foundations and have taken strong action to improve the overall efficiency of
their operations.
Various actions have been taken to improve competitiveness, such as the
launching of the "i-ai Plan", a monthly discount service for Internet access
7
<PAGE>
through INS-Net 64 and INS-Net 64 Lite. The regional operating companies are
now also offering "IP connection services" on an experimental basis. This
provides flat-rate access to the Internet via the INS-Net (ISDN lines). In a
further bid to improve the attractiveness of services, fixed-amount discounts
are being offered to customers subscribing to a multiple number of add-on
functions.
Action has also been taken to improve overall quality of customer services. To
respond to new customer needs arising from the diversification of lifestyles,
the operating hours of the "dial 116" service was extended to include Saturdays,
Sundays and holidays beginning on July 31, 1999. The "dial 116" service
processes inquiries and orders for the relocation of subscriber telephone lines
and various other services.
With regard to improved management efficiency, the regional operating companies
unveiled their "Mid-term Restructuring Plan" in November 1999. The plan
features significant cutbacks in personnel as well as plant and equipment
investment and are aimed at establishing a strong management foundation for
coping with rapid changes in the business environment. Preparations are now
being made for launching the plan during fiscal 2000.
As a result of these activities, NTT East registered operating revenues of
2,154.7 billion yen for the term under review, while NTT West reported operating
revenues of 2,071.6 billion yen.
NTT Communications Corporation
- ------------------------------
NTT Communications operates in the fields of inter-prefectural and international
communication services. Competition in the inter-prefectural and international
communication markets is also becoming increasingly intensified as a result of
deregulation and technological innovation. The globalization of corporate
activities has also stimulated competition in these fields. During the term
under review, a number of major mergers and alliances were announced by both
domestic and international telecommunications carriers, further intensifying
competition.
8
<PAGE>
Against this background, NTT Communications has focused its business strategies
on diversifying its range of services and bolstering its competitive position in
the global market.
In the area of domestic communication services, NTT Communications has taken
various actions to upgrade customer convenience while improving its competitive
position. For instance, it has launched an integrated discount system for
domestic and international calls and is offering nationwide local-rate
connections to access points for OCN services.
In the area of international communication services, NTT Communications launched
its international telephone service in October 1999 with the "0033" access code.
The company upgraded its networks to aggressively expand the geographic coverage
of its services and provides access to a total of 231 countries and regions
throughout the world as of the end of March. With regard to global
communication services for corporate customers, the "Arcstar" program has been
in operation since September 1997 and serves a total of 47 destinations as of
the end of March.
Active measures have also been taken to provide international IP services
through strategic alliances with Philippine Long Distance Telephone Company
(PLDT) and Australia's Davnet Group.
As a result of these activities, NTT Communications registered operating
revenues of 1,075.3 billion yen for the term under review.
NTT Data Corporation
- --------------------
The principal businesses of NTT Data consist of systems engineering and network
system services.
During the term under review, NTT Data continued to provide reliable services
for large-scale systems and also worked toward upgrading existing functions and
developing new peripheral businesses. In this way, the company has
9
<PAGE>
contributed to strengthening the business foundation of its customers while
responding to their cost-cutting and service differentiation requirements.
NTT Data has bolstered its Internet service provider (ISP) business and has also
taken active steps toward expanding its position in the application service
provider (ASP) business.
As a result of these activities, NTT Data registered operating revenues of 716.4
billion yen (up 1.6% from the previous year) for the term under review.
NTT DoCoMo, Inc.
- ----------------
The principal businesses of NTT DoCoMo (formerly NTT Mobile Communications
Network Inc.) consist of mobile telephone services, PHS services and pager
services.
During the term under review, competition in the mobile communications market
intensified. Against this background, the company continued to strengthen its
position in the mobile multimedia market with the introduction of a new line of
mobile telephones with improved speech quality and the accelerated proliferation
and expansion of its "i-Mode" services. The launching of the next generation of
mobile communication systems (IMT-2000) is currently under preparation with
progress being made in R&D and testing for the commercialization of the W-CDMA
system.
The company is actively pursuing global strategies, including equity
participation in overseas telecommunications carriers and content providers.
As a result of these activities, combined total of operating revenues of NTT
DoCoMo and its eight regional subsidiaries registered 3,927.4 billion yen (up
20.5% from the previous year) for the term under review.
(2) Projections for Fiscal Year Ending March 31, 2001
- ------------------------------------------------------
10
<PAGE>
Regarding the fiscal year ending March 31, 2001, projections point to a number
of negative elements, including continued sluggishness in personal consumption
and instability in labor markets. On the other hand, corporate profits are
showing signs of improvement and various policy measures are expected to provide
added buoyancy to the economy. As such, the economy can be expected to follow a
path of mild recovery during the coming fiscal year.
In the information communication field, the explosive growth in Internet use is
continuing. The increasingly diverse modes of Internet access have supported a
marked increase in access which in turn is feeding a cycle of expanded visual
content and growth in market scale. These developments will certainly generate
increased competition in terms of both fee structures and services. Electronic
commerce is just one example of Internet-based businesses. The intensification
of competition in this promising field can be expected to further accelerate the
pace of reorganization in the telecommunications industry.
Given these dramatic changes in the market environment, the NTT Group is aiming
to transform itself into a "Global Information Sharing Corporate Group" and has
been identifying an overall direction for its Group businesses. The "NTT Group
Three-Year Business Plan " (fiscal years 2000 - 2002) announced in April 2000
contains the lines of action to be followed by each member company of the NTT
Group. In order to respond appropriately to the dramatic changes occurring in
today's markets, this Three-Year Business Plan will undergo thorough annual
review. Through this process, NTT will seek to establish a system for group
management based on a pure holding company.
Projections for the fiscal year ending March 31, 2001 are as follows:
Consolidated operating revenues are projected to reach 10,827.0 billion yen (up
3.9% from the previous year). Consolidated recurring profit is projected to
amount to 675.0 billion yen (down 18.2% from the previous year), while
consolidated net income is expected to reach 99.0 billion yen.
For the fiscal year ending March 31, 2001, we expect to offer common dividends
of 5,000 yen per share.
11
<PAGE>
For further information, Please contact:
Kenya Nakatsuka
Press Relations
Nippon Telegraph and Telephone Corporation
Telephone: 03-5205-5550
E-mail: [email protected]
<PAGE>
Attachment 1
NIPPON TELEGRAPH AND TELEPHONE CORPORATION
------------------------------------------
NON-CONSOLIDATED BALANCE SHEET
------------------------------
(Based on Japanese Accounting Principles)
<TABLE>
<CAPTION>
March 31, 1999 March 31, 2000
-------------- --------------
Millions Millions Millions
of Yen of Yen of US$
------ ------ ------
<S> <C> <C> <C>
ASSETS
- ------
CURRENT ASSETS
Short-term loan receivable 580,795 452,798 4,271
Income tax receivable --- 239,428 2,258
Other 1,525,517 73,574 694
Total current assets 2,106,312 765,801 7,224
---------- --------- ---------
FIXED ASSETS
Investments in subsidiaries and affiliated companies 346,618 4,446,527 41,948
Long-term loan receivable 1,338 2,425,854 22,885
to subsidiaries and affiliated companies
Other 9,013,124 430,779 4,063
Total fixed assets 9,361,082 7,303,161 68,897
---------- --------- -------
TOTAL ASSETS 11,467,394 8,068,962 76,122
========== ========= =======
LIABILITIES
- -----------
CURRENT LIABILITIES:
Current portion of long-term debt 447,562 250,503 2,363
Accounts payable,trade 699,936 11,492 108
Accrued taxes on income 425,924 --- ---
Accrued consumption tax --- 417,582 3,939
Other 717,208 121,134 1,142
Total current liabilities 2,290,631 800,712 7,553
---------- --------- -------
LONG-TERM LIABILITIES:
Long-term debt 2,218,977 2,425,854 22,885
Liability for employees' severance payments 2,030,752 26,225 247
Other 19,444 497 4
Total long-term liabilities 4,269,174 2,452,576 23,137
---------- --------- -------
TOTAL LIABILITIES 6,559,806 3,253,288 30,691
---------- --------- -------
SHAREHOLDERS' EQUITY
- --------------------
Common stock 795,600 795,600 7,505
Additional paid-in capital 2,530,476 2,530,476 23,872
Legal reserve 107,453 123,372 1,163
Special depreciation reserve 64,196 31,567 297
Reserve for buy-back of shares --- 0 0
General reserves 895,000 895,000 8,443
Unappropriated retained earnings 514,861 439,656 4,147
TOTAL SHAREHOLDERS' EQUITY 4,907,588 4,815,673 45,430
---------- --------- -------
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY 11,467,394 8,068,962 76,122
========== ========= =======
</TABLE>
Note: Yen amounts have been translated, for convenience only, at
(Yen)106=US$1.00, the approximate exchange rate on March 31, 2000.
Fractions are rounded down.
<PAGE>
Attachment 2
NIPPON TELEGRAPH AND TELEPHONE CORPORATION
------------------------------------------
NON-CONSOLIDATED STATEMENT OF INCOME
------------------------------------
(Based on Japanese Accounting Principles)
<TABLE>
<CAPTION>
Fiscal Year Ended March 31
------------------------------
1999 2000
------ ------
Millions Millions Millions
of Yen of Yen of US$
------ ------ ------
<S> <C> <C> <C>
OPERATING REVENUES 6,137,003 1,696,799 16,007
OPERATING EXPENSES 5,893,172 1,585,076 14,953
OPERATING INCOME 243,831 111,722 1,053
NON-OPERATING REVENUES 112,897 135,100 1,274
NON-OPERATING EXPENSES 119,359 129,248 1,219
RECURRING PROFIT 237,368 117,574 1,109
EXTRAORDINARY PROFIT 823,929 71,827 677
EXTRAORDINARY LOSS 175,587 11,330 106
INCOME BEFORE TAXES 885,711 178,071 1,679
INCOME TAXES 499,500 --- ---
CORPORATION, INHABITANT AND ENTERPRISE TAXES
CURRENT --- 16,000 150
DEFERRED --- 65,000 613
NET INCOME 386,211 97,071 915
--------- --------- ------
PER SHARE DATA(in exact) of Yen of Yen of US$
--------- --------- ------
NET INCOME 24,271 6,115 57
CASH DIVIDEND 10,000 5,000 47
</TABLE>
Note: Yen amounts have been translated, for convenience only, at
(Yen)106=US$1.00, the approximate exchange rate on March 31, 2000.
Fractions are rounded down.
<PAGE>
Attachment 3
Proposal of Appropriation of Unappropriated Retained Earnings
-------------------------------------------------------------
<TABLE>
<CAPTION>
(Millions of Yen)
- --------------------------------------------------------------------------------------------------
Fiscal Year Fiscal Year
Ended March 31, 1999 Ended March 31, 2000
- --------------------------------------------------------------------------------------------------
<S> <C> <C>
Unappropriated Retained Earnings 514,861 439,656
for the Year
Reversal of Reserve for Buy-back --- 0
of Shares
Reversal of Special Depreciation 14,393 7,692
Reserve
Total 529,255 447,349
Proposal of Appropriation:
Legal Earned Reserve 11,953 3,964
Cash Dividends 119,339 39,586
((Yen)7,500 per share) ((Yen)2,500 per share)
(Cash Dividends (Yen)2,500)
(Special Dividends (Yen)5,000)
. Bonuses to Directors and 190 52
Corporate Auditors
(Portion to Corporate (21) (8)
Auditors)
Reserve for Buy-back of Shares 120,000 ---
Special Depreciation Reserve 4,456 403
. General Reserves --- 150,000
Pofits Brought Forward 273,316 253,343
- --------------------------------------------------------------------------------------------------
</TABLE>
Note: 1. An interim dividend of (Yen)39,657 million ((Yen)2,500 per share) was
paid to shareholders on December 13, 1999.
2. Reserve for buy-back of shares is reversed from the balance after
acquiring treasury stock and retiring of stock through retained
profits out of the reversal for buy-back of shares submitted at the
resolutions of shareholders at the 14th ordinary general meeting of
shareholders.
3. Reversal and provision of the special depreciation reserve are in
accordance with the Special Taxation Measures Law. The amounts of
reversal and provision are net of tax.
<PAGE>
Attachment 4
Business Results (Non-consolidated Operating Revenues)
------------------------------------------------------
(Based on Japanese Accounting Principles)
<TABLE>
<CAPTION>
(Millions of Yen)
- ----------------------------------------------------------------------------------------------------------------
Service Fiscal Year Ended Fiscal Year Ended Increase
March 31, 1999 March 31, 2000 (Decrease)
- -----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Voice Transmission Services 4,599,272 1,090,095 (3,509,177)
Data Transmission Services 111,669 33,333 (78,336)
Leased Circuit Services 640,020 161,763 (478,257)
Telegram Services 84,423 21,531 (62,891)
Dividend Income --- 4,234 4,234
Revenues from the Promotion --- 20,591 20,591
of the Management of
the NTT Group
Basic Research and --- 176,620 176,620
Development Revenues
Other Services 701,616 188,628 (512,988)
- -------- -------------------------------------------------------------------------------------------------------
Total Operating Revenues 6,137,003 1,696,799 (4,440,204)
- ----------------------------------------------------------------------------------------------------------------
</TABLE>
Note: Fractions are rounded down.
On July 1, 1999, NTT's business activities were transferred to Nippon
Telegraph and Telephone East Corporation, Nippon Telegraph and Telephone
West Corporation, and NTT Communications Co., Ltd.
<PAGE>
Attachment 5
NIPPON TELEGRAPH AND TELEPHONE CORPORATION
------------------------------------------
CONSOLIDATED BALANCE SHEET
--------------------------
(Based on Japanese Accounting Principles)
<TABLE>
<CAPTION>
March 31, 1999 March 31, 2000
--------------- --------------
Millions Millions Millions
of Yen of Yen of US$
--------------- --------------- ---------
<S> <C> <C> <C>
ASSETS
- ------
FIXED ASSETS 13,703,898 14,834,418 139,947
CURRENT ASSETS 3,708,290 3,577,281 33,747
TOTAL ASSETS 17,412,188 18,411,700 173,695
========== ========== =======
LIABILITIES
- -----------
LONG-TERM LIABILITIES:
Long-term debt 4,511,390 4,318,019 40,736
Liability for employees' severance payments 2,193,662 2,950,326 27,833
Other 233,103 584,781 5,516
Total long-term liabilities 6,938,155 7,853,127 74,086
---------- ---------- -------
CURRENT LIABILITIES:
Current portion of long-term debt 854,242 820,736 7,742
Accounts payable, trade 875,987 759,679 7,166
Short-term borrowings 232,159 347,290 3,276
Accrued taxes on income 492,775 346,896 3,272
Other 1,054,407 1,277,805 12,054
Total current liabilities 3,509,572 3,552,407 33,513
---------- ---------- -------
TOTAL LIABILITIES 10,447,728 11,405,535 107,599
---------- ---------- -------
MINORITY INTEREST IN CONSOLIDATED
- ---------------------------------
SUBSIDIARIES 750,538 869,548 8,203
- ------------ ---------- ---------- -------
SHAREHOLDERS' EQUITY
- --------------------
Common stock 795,600 795,600 7,505
Additional paid-in capital 2,530,476 2,530,476 23,872
Retained earnings 2,888,757 2,810,591 26,515
Treasury stock (911) (51) (0)
TOTAL SHAREHOLDERS' EQUITY 6,213,922 6,136,616 57,892
---------- ---------- -------
TOTAL LIABILITIES,MINORITY INTEREST IN
CONSOLIDATED SUBSIDIARIES AND
SHAREHOLDERS' EQUITY 17,412,188 18,411,700 173,695
========== ========== =======
</TABLE>
Note: Yen amounts have been translated, for convenience only, at (Yen)
106=US$1.00, the approximate exchange rate on March 31, 2000. Fractions
are rounded down.
<PAGE>
Attachment 6
NIPPON TELEGRAPH AND TELEPHONE CORPORATION
------------------------------------------
CONSOLIDATED STATEMENT OF INCOME
--------------------------------
(Based on Japanese Accounting Principles)
<TABLE>
<CAPTION>
Fiscal Year Ended March 31
--------------------------
1999 2000
--------- ---------------------
Millions Millions Millions
of Yen of Yen of US$
--------- ---------- --------
<S> <C> <C> <C>
OPERATING REVENUES 9,729,673 10,421,113 98,312
OPERATING EXPENSES 8,859,402 9,440,810 89,064
OPERATING INCOME 870,270 980,303 9,248
NON-OPERATING REVENUES 69,743 71,981 679
NON-OPERATING EXPENSES 291,376 227,247 2,143
RECURRING PROFIT 648,638 825,036 7,783
EXTRAORDINARY PROFIT 785,420 86,086 812
EXTRAORDINARY LOSS 132,450 820,045 7,736
INCOME BEFORE TAXES 1,301,607 91,077 859
CORPORATION, INHABITANT
AND ENTERPRISE TAXES 659,112 64,729 610
MINORITY INTEREST IN CONSOLIDATED
SUBSIDIARIES 39,804 94,158 888
NET INCOME 602,690 (67,811) (639)
--------- ---------- ------
</TABLE>
Note: Yen amounts have been translated, for convenience only, at (Yen)
106=US$1.00, the approximate exchange rate on March 31, 2000. Fractions
are rounded down.
<PAGE>
Attachment 7
NIPPON TELEGRAPH AND TELEPHONE CORPORATION
------------------------------------------
CONSOLIDATED STATEMENT OF CASH FLOWS
------------------------------------
(Based on Japanese Accounting Principles)
<TABLE>
<CAPTION>
Fiscal Year Ended March 31
--------------------------
2000
---------------------
Millions Millions
of Yen of US$
---------- --------
<S> <C> <C>
Cash Flows From Operating Activities:
Income before taxes 91,077 859
Depreciation and amortization 2,550,762 24,063
Loss on sale or disposal of property, plant and equipment 209,146 1,973
Increase (decrease) in liability for employees' severance payments 755,929 7,131
(Increase) decrease in notes and accounts receivable, trade (262,045) (2,472)
Increase (decrease) in accounts payable, trade and accrued payroll 81,978 773
(Increase) decrease in receivable consumption tax 71,973 678
Other 262,875 2,479
- ----------------------------------------------------------------------------------------------
3,761,697 35,487
- ----------------------------------------------------------------------------------------------
Proceeds from interest and dividends 5,438 51
Payments for interest (156,196) (1,473)
Payments for taxes on income (831,109) (7,840)
- ----------------------------------------------------------------------------------------------
Net cash provided by operating activities 2,779,829 26,224
- ----------------------------------------------------------------------------------------------
Cash Flows From Investing Activities:
Payments for property, plant and equipment (3,020,100) (28,491)
Acquisition of investments (166,429) (1,570)
Other 222,886 2,102
- ----------------------------------------------------------------------------------------------
Net cash used in investing activities (2,963,643) (27,958)
- ----------------------------------------------------------------------------------------------
Cash Flows Financing Activities:
Proceeds from issuance of long-term debt 1,596,646 15,062
Payments for settlement of long-term debt (1,860,100) (17,548)
Increase (decrease) in short-term borrowings 157,628 1,487
Dividends paid (165,318) (1,559)
Other (108,955) (1,027)
- ----------------------------------------------------------------------------------------------
Net cash provided (used) by financing activities (380,099) (3,585)
- ----------------------------------------------------------------------------------------------
Effect of exchanges on cash and cash equivalents (10,493) (98)
- ----------------------------------------------------------------------------------------------
Net decrease in cash and cash equivalents (547,406) (5,418)
Cash and cash equivalents at beginning of year 1,706,657 16,100
- ----------------------------------------------------------------------------------------------
Increase due to addition of consolidated subsidiaries 23,024 217
- ----------------------------------------------------------------------------------------------
Cash and cash equivalents at end of year 1,155,275 10,898
==============================================================================================
</TABLE>
Note: Yen amounts have been translated, for convenience only, at (Yen)
106=US$1.00, the approximate exchange rate on March 31, 2000. Fractions are
rounded down.
<PAGE>
Attachment 8
NTT's New Board of Directors
----------------------------
(subject to shareholders' approval)
President
Jun-ichiro Miyazu
Senior Executive Vice Presidents
Norio Wada
Yusuke Tachibana
Haruki Matsuno
Senior Vice Presidents
Kanji Koide
Shigehiko Suzuki
Hiromi Wasai
Toyohiko Takabe
Satoru Miyamura
Takashi Imai
Yotaro Kobayashi
Corporate Auditors
Keisuke Sada
Takao Nakajima
Makoto Yoshida
Hideaki Toda
Note: The first four members of this list are nominated for positions with
representative authority.
<PAGE>
Attachment 9
Nippon Telegraph and Telephone Corporation
May 26, 2000
NTT's Shares and Shareholders (as of March 31, 2000)
1. Classification of Shareholders
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------------------------------
NTT's Shares and Shareholders
----------------------------------------------------------------------------------------
Details Government Financial Securities Other Foreign Domestic Odd-Lot
and Public Institutions Firms Domestic Corporations, Individuals, Total Shares
Bodies Corporations etc. etc.
(Individuals)
- -------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Total Holders 1,398
4 789 160 15,931 (88) 1,362,957 1,381,239
===================================================================================================================
Total Shares 2,352,460
8,416,909 1,861,246 79,492 342,924 (332) 2,738,486 15,791,517 43,073
------------------------------------------------------------------------------------------------------------
% 14.90
53.30 11.79 0.50 2.17 (0.00) 17.34 100
- -------------------------------------------------------------------------------------------------------------------
</TABLE>
Note: 1. "Other Domestic Corporations" includes 3,510 shares under the name of
Japan Securities Depository Center, and "Odd-Lot Shares" includes 0.72
shares under the name of Japan Securities Depository Center.
2. "Domestic Individuals, etc." includes 49 shares of treasury stock, and
"Odd-Lot Shares" includes 0.02 shares of treasury stock. The actual
number of treasury stocks at the end of March 31, 2000 was 35.02.
3. The number of shareholders who own only odd-lot shares is 255,579.
2. Classification by Number of Shares
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------
NTT's Shares and Shareholders
-----------------------------------------------------------------------------------------
Odd-Lot
Details At Least At Least At Least At Least At Least At Least 5 At Least 1 Total Shares
1,000 500 100 50 10
- ---------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Number of 395 202 1,314 1,390 25,659 62,390 1,289,889 1,381,239
Holders
---------------------------------------------------------------------------------------------------------
% 0.03 0.01 0.10 0.10 1.86 4.52 93.39 100.00
=====================================================================================================================
Total Shares 12,678,988 138,112 262,200 90,378 398,579 373,741 1,849,519 15,791,517 43,073
---------------------------------------------------------------------------------------------------------
% 80.29 0.88 1.66 0.57 2.52 2.37 11.71 100.00
- ---------------------------------------------------------------------------------------------------------------------
</TABLE>
Note: 1. "At Least 1,000" includes 3,510 shares under the name of the Japan
Securities Depository Center, and "Odd-Lot Shares" includes 0.72
shares under the name of Japan Securities Depository Center.
2. "At Least 10" includes 49 shares of treasury stock, and "Odd-Lot
Shares" includes 0.02 shares of treasury stock.
3. Principal Shareholders
<TABLE>
<CAPTION>
---------------------------------------------------------------------------------------------------------------------
Name Share Holdings Percent of Total Shares Issued
---------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
The Minister of Finance 8,416,855.26 53.15
State Street Bank and Trust Company 249,755.00 1.58
The Sumitomo Trust & Banking Co., Ltd. 224,640.00 1.42
The Chase Manhattan Bank, N.A. London 179,698.00 1.13
The Mitsubishi Trust and Banking Corporation 152,902.00 0.97
The Chase Manhattan Bank, N.A. London SL Omnibus Account 142,074.00 0.90
NTT Employee Share-Holding Association 133,386.22 0.84
Moxley and Company 108,929.00 0.69
Nippon Life Insurance Company 108,369.68 0.68
Boston Safe Deposit PSDT, Treaty Clients Omnibus 103,649.00 0.65
---------------------------------------------------------------------------------------------------------------------
Total 9,820,258.16 62.02
---------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
May 26, 2000
FOR IMMEDIATE RELEASE
Settlement for Fiscal Year Ending March 31, 2000
The results of Nippon Telegraph and Telephone East Corporation (NTT East) for
fiscal 1999 are presented in the order indicated on the attachment.
This period was from July 1, 1999, the date of the establishment of NTT East,
until March 31, 2000.
(Attachment)
1. Summary of Results
2. Non-consolidated Balance Sheet
3. Non-consolidated Statement of Income
4. Non-consolidated Statement of Cash Flows
5. Proposal of Appropriation of Unappropriated Retained Earnings
6. Business Results (Non-consolidated Operating Revenues)
7. New Board of Directors
Inquiries:
Susumu Mitou, Takami Honma
Accounting Section, Finance Division
NTT East
Tel: 03-5359-3331
E-mail: [email protected]
---------------------
[email protected]
---------------------------
<PAGE>
Attachment 1
SUMMARY OF RESULTS
------------------
Nippon Telegraph and Telephone East Corporation (NTT East) was established and
launched its operations on July 1, 1999 following the reorganization of Nippon
Telegraph and Telephone Corporation. NTT East operates as a telecommunications
enterprise in the eastern Japan region.
During the business year under review, the Japanese economy showed signs of mild
improvement as a result of the impact of various policy measures and the Asian
economic recovery. However, severe conditions persisted in general as private
demand remained anemic as a consequence of sluggish personal consumption and the
continued downturn in plant and equipment investment.
Market structures in the telecommunications field are undergoing important
changes in tandem with the proliferation of mobile communications and the sharp
increase in demand for digital data transmission services which are taking the
place of conventional voice-based communication services. The rapid growth in
Internet use is also contributing to the expansion of these markets.
Competition in local telecommunications markets is being rapidly intensified by
progress in GC interconnections and the increasing number of enterprises
providing Internet access services using ADSL, wireless and optical fiber
technologies. This means that intense competition is now affecting all
telecommunications fields, ranging from regional and long-distance markets to
the international market.
Various significant systemic changes are scheduled, including the introduction
of price caps, long-run incremental cost methodology and dialing parity system.
We expect these developments to lead to a new round of price-cutting and
discounting, as well as increased efforts to obtain new customers.
Against this background, NTT East has adopted as its basic management principle
the provision of timely and attractive services which are "inexpensive," "easy
to use" and "reliable." NTT East has also launched various initiatives to
1
<PAGE>
re-direct its operations from telephones to information sharing in order to
develop new sources of income.
Firstly, following on the rapid increase in Internet use, NTT East has been
actively promoting INS-Net 64 and other ISDN lines. Similarly, in response to
customer needs for less expensive Internet access, NTT East launched the
"I-ai Plan," a discount service for Internet users providing fixed-rate access
to one local number up to a certain maximum monthly amount. In response to
strong customer needs, the "IP Connection Service," a flat-rate Internet access
service for INS-Net service subscribers started on an experimental basis in
November 1999, will be expanded in May and made available to a larger
geographical area. At the same time, monthly charges will be reduced from 8,000
yen to 4,500 yen. In yet another related initiative aimed at meeting diverse
customer needs for high-speed and low-cost Internet access services, the " ADSL
Internet Access Service," a flat-rate access service based on ADSL technologies,
was started in December 1999 on a trial basis.
In the corporate sector of the market, NTT East has actively promoted its
management support program known as "Team marketing solution" featuring team
collaboration with customers to meet management challenges. With the
cooperation of other NTT Group companies, NTT East offers a full range of
business solutions extending from systems design and construction to outsourcing
of maintenance and operations. NTT continues to strengthen its marketing
capabilities through such initiatives.
To improve the quality of our customer services while adjusting to changing
lifestyles, beginning in July 1999, NTT East has extended the operating hours of
its "Dial 116" services to include Saturdays, Sundays and holidays. The "Dial
116" service handles inquiries and orders for relocation of subscriber telephone
lines and various other services.
The development of digital broadcasting points to the emergence of new
information sharing markets featuring the merging of telecommunications and
broadcasting. NTT East has been actively preparing for entry into this field as
a new source of income and has taken steps to develop a cooperative framework
with various other enterprises. As the first step, SN Planning
2
<PAGE>
Corporation Limited was jointly established with Japan Digital Broadcasting
Services, Inc. in December 1999. The new company will be in charge of studying
the feasibility of customer control systems for processing of subscriptions and
billing and charging functions related to a digital satellite broadcasting
system using the communications satellite scheduled for placement in orbit at
110 degrees east longitude. In March 2000, NTT East established NTT MediaCross,
Inc., a consignee for maintenance and operation of systems for viewer
identification. These are important preliminary steps for NTT East's entry into
new information sharing markets.
NTT East is committed to rationalizing its operations and streamlining its
management to create a firm foundation for responding to the rapid changes in
the business environment. NTT East intends to position itself as the core
company in the NTT Group as the Group transforms itself into a "Global
Information Sharing Group." For this purpose, in November 1999, NTT East
announced its "Mid-term Restructuring Plan" covering the three-year period
between fiscal years 2000 and 2002. As part of this plan, NTT East will reduce
its workforce by approximately 10,000 employees by the end of fiscal 2002
through such means as the merging or closing of branch offices, promoting
greater efficiency by streamlining its headquarters and cutting overhead costs,
re-assigning employees to Group companies, and postponing the recruitment of new
workers. The program also contains cost-cutting measures in the area of plant
and equipment investment featuring reductions in procurement and construction
costs and promotion of demand-based and efficiency-enhancing capital investment.
Through these measures, NTT East plans to cut costs by approximately 450 billion
yen in the three-year period between fiscal years 2000 and 2002.
With regard to the Y2K problem, NTT East established a Y2K Committee charged
with making all necessary adjustments in the company's facilities, systems and
equipment. A contingency plan was also formulated to enable prompt action in
case of any trouble. As a result of these efforts, no trouble occurred
affecting the Company's telecommunications services, and NTT East was able to
maintain stable and uninterrupted services throughout the period.
NTT East has undertaken various activities for the preservation of the global
3
<PAGE>
environment in the hope of contributing to a new century of safe and comfortable
living. In December 1999, the company formulated the "NTT East Global
Environmental Charter" and has launched various initiatives for the conservation
of paper resources, prevention of global warming, and the reduction of waste.
In addition, NTT East has created an "Ecology Community Plaza" to serve as a
forum of exchange for activities related to the preservation of the global
environment. NTT East will continue to pursue the objectives of its Charter to
fulfill its corporate responsibility for protecting the global environment and
contributing actively to the development of local communities.
Regarding instances of the leakage of customer information, we have taken
seriously the public's stern criticisms of NTT East as a telecommunications
enterprise privy to various types of personal information. We recognize this to
be an extremely serious matter with critical repercussions on our business
operations. As such, NTT East is taking concerted efforts to prevent any
recurrence and is committed to regaining the confidence of its customers by
implementing strict controls for the protection of customer information.
NTT East's financial performance during the period under review was as follows:
operating revenues amounted to 2,154.7 billion yen, and current profit amounted
to 56.7 billion yen. During the period under review, NTT East registered
special losses related to a 325 billion yen addition to retirement allowance
reserves. As a result, net loss came to 157.2 billion yen.
4
<PAGE>
Attachment 2
NON-CONSOLIDATED BALANCE SHEET
------------------------------
(Based on Japanese Accounting Principles)
March 31, 2000
--------------
Millions Millions
of Yen of US$
------ ------
ASSETS
- ------
FIXED ASSETS 4,399,614 41,505
CURRENT ASSETS 936,947 8,839
TOTAL ASSETS 5,336,561 50,344
========= ======
LIABILITIES
- -----------
LONG-TERM LIABILITIES:
Long-term debt 1,041,939 9,829
Liability for employees' severance payments 1,246,525 11,759
Other 7,942 74
Total long-term liabilities 2,296,407 21,664
--------- ------
CURRENT LIABILITIES:
Current portion of long-term debt 100,880 951
Accounts payable, trade 275,432 2,598
Short-term borrowings 188,225 1,775
Accrued taxes on income 43,490 410
Other 358,189 3,379
Total current liabilities 966,219 9,115
--------- ------
TOTAL LIABILITIES 3,262,626 30,779
--------- ------
SHAREHOLDERS' EQUITY
- --------------------
Common stock 335,000 3,160
Additional paid-in capital 1,679,281 15,842
Unappropriated retained earnings 59,653 562
TOTAL SHAREHOLDERS' EQUITY 2,073,935 19,565
--------- ------
TOTAL LIABILITIES AND
SHAREHOLDERS' EQUITY 5,336,561 50,344
========= ======
Note: Yen amounts have been translated, for convenience only, at
(Yen)106=US$1.00, the approximate exchange rate on March 31, 2000.
Fractions are rounded down.
5
<PAGE>
Attachment 3
NON-CONSOLIDATED STATEMENT OF INCOME
------------------------------------
(Based on Japanese Accounting Principles)
Nine-months
-----------
Ended March 31, 2000
--------------------
Millions Millions
of Yen of US$
------ ------
OPERATING REVENUES 2,154,710 20,327
OPERATING EXPENSES 2,083,972 19,660
OPERATING INCOME 70,737 667
NON-OPERATING REVENUES 38,602 364
NON-OPERATING EXPENSES 52,563 495
RECURRING PROFIT 56,776 535
EXTRAORDINARY LOSS 325,022 3,066
LOSS BEFORE TAXES 268,246 2,530
INCOME TAXES
CURRENT 43,500 410
DEFERRED (154,500) (1,457)
NET LOSS 157,246 1,483
--------- ------
PER SHARE DATA (in exact) of Yen of US$
--------- ------
NET LOSS 23,469 221
Note: Yen amounts have been translated, for convenience only, at
(Yen)106=US$1.00, the approximate exchange rate on March 31, 2000.
Fractions are rounded down.
6
<PAGE>
Attachment 4
NON-CONSOLIDATED STATEMENT OF CASH FLOWS
----------------------------------------
(Based on Japanese Accounting Principles)
<TABLE>
<CAPTION>
Nine-Months
-----------
Ended March 31, 2000
--------------------
Millions Millions
of Yen of US$
------ ------
<S> <C> <C>
Cash flows from operating activities:
Loss before taxes (268,246) (2,530)
Depreciation and amortization 484,609 4,571
Loss on sale or disposal of property, plant and equipment 52,027 490
Increase (decrease) in liability for employees' severance payments 314,027 2,962
(Increase) decrease in notes and accounts receivable, trade (60,128) (567)
Increase (decrease) in accounts payable, trade and accrued payroll 201,560 1,901
(Increase) decrease in receivable consumption tax (175,794) (1,658)
Other 48,600 458
-----------------------------------------------------------------------------------------------------------------
596,657 5,628
-----------------------------------------------------------------------------------------------------------------
Proceeds from interest and dividends 57 0
Payments for interest (21,543) (203)
Payments for taxes on income (9) (0)
-----------------------------------------------------------------------------------------------------------------
Net cash provided by operating activities 575,161 5,426
-----------------------------------------------------------------------------------------------------------------
Cash flows from investing activities:
Payments for property, plant and equipment (395,826) (3,734)
Acquisition of investments (11,849) (111)
Other 5,572 52
-----------------------------------------------------------------------------------------------------------------
Net cash used in investing activities (402,103) (3,793)
-----------------------------------------------------------------------------------------------------------------
Cash flows financing activities:
Proceeds from issuance of long-term debt 50,000 471
Payments for settlement of long-term debt (52,336) (493)
Other (2,986) (28)
-----------------------------------------------------------------------------------------------------------------
Net cash provided (used) by financing activities (5,323) (50)
-----------------------------------------------------------------------------------------------------------------
Net increase (decrease) in cash and cash equivalents 167,734 1,582
Cash and cash equivalents at beginning of year 6,194 58
-----------------------------------------------------------------------------------------------------------------
Cash and cash equivalents at end of year 173,928 1,640
=================================================================================================================
</TABLE>
Note: Yen amounts have been translated, for convenience only, at
(Yen)106=US$1.00, the approximate exchange rate on March 31, 2000.
Fractions are rounded down. The above figures represent the results
after the business transfer from Nippon Telegraph and Telephone
Corporation.
7
<PAGE>
Attachment 5
PROPOSAL OF APPROPRIATION OF UNAPPROPRIATED RETAINED EARNINGS
-------------------------------------------------------------
<TABLE>
<CAPTION>
(Millions of Yen)
- --------------------------------------------------------------------------------
Nine-Months
Ended March 31, 2000
- --------------------------------------------------------------------------------
<S> <C>
Unappropriated Retained Earnings for the Year 59,653
Total 59,653
Proposal of Appropriation:
Special Depreciation Reserve 3,527
Profits Brought Forward 56,126
- --------------------------------------------------------------------------------
</TABLE>
Note: Provision of the special depreciation reserve is in accordance with the
Special Taxation Measures Law. The amount of provision is net of tax.
8
<PAGE>
Attachment 6
BUSINESS RESULTS (NON-CONSOLIDATED OPERATING REVENUES)
------------------------------------------------------
(Based on Japanese Accounting Principles)
<TABLE>
<CAPTION>
(Millions of Yen)
- -------------------------------------------------------------------------------
Service Nine-Months Ended
March 31, 2000
- -------------------------------------------------------------------------------
<S> <C>
Voice Transmission Services 1,549,977
Data Transmission Services 1,254
Leased Circuit Services 279,438
Telegram Services 28,575
Other Services 117,535
Telecommunications 1,976,780
Total Revenues
- -------------------------------------------------------------------------------
Related Business 177,929
Total Revenues
- -------------------------------------------------------------------------------
Total Operating Revenues 2,154,710
- -------------------------------------------------------------------------------
</TABLE>
Note: Fractions are rounded down.
9
<PAGE>
Attachment 7
NEW BOARD OF DIRECTORS
----------------------
(subject to shareholder's approval)
President
Hidekazu Inoue
Senior Executive Vice President
Satoshi Miura
Executive Vice Presidents
Shunzo Morishita
Yoshiyuki Sukemune
Senior Vice Presidents
Masamoto Horiguchi
Takahiko Yamaguchi
Goro Yagihashi
Kazufumi Watanabe
Akio Nakada
Tokio Nakajima
Norio Onodera
Hiroaki Tamai
Hajime Takashima
Toyohiko Takabe
Corporate Auditors
Kageo Nakano
Toshio Hayata
Kousuke Takahashi
Note:The first three members of this list are nominated for positions with
representative authority.
10
<PAGE>
May 26, 2000
FOR IMMEDIATE RELEASE
Settlement for Fiscal Year Ending March 31, 2000
The results of Nippon Telegraph and Telephone West Corporation (NTT West) for
fiscal 1999 are presented in the following order.
1. Summary of Results
2. Non-consolidated Balance Sheet
3. Non-consolidated Statement of Income
4. Non-consolidated Statement of Cash Flows Statement
5. Proposal of Appropriation of Unappropriated Retained Earnings
6. Business Results (Non-consolidated Operating Revenues)
7. New Board of Directors
This period was from July 1, 1999, the date of the establishment of NTT West,
until September 30,2000.
Inquiries:
Mr. Masaaki Hiroshige or Mr. Shinji Uchida
Accounting Section, Finance Division
NTT West
Tel: 06-4793-3141
E-mail: [email protected]
<PAGE>
Attachment 1
SUMMARY OF RESULTS
------------------
Nippon Telegraph and Telephone West Corporation (NTT West) was established and
launched its operations on July 1, 1999 following the reorganization of Nippon
Telegraph and Telephone Corporation. NTT West operates as a telecommunications
enterprise in the western Japan region.
During the term under review, severe conditions persisted in the Japanese
economy with private demand showing continued weakness. However, signs of a
mild recovery were seen toward the end of the term as shown in the improvement
in corporate earnings and the recovery of plant and equipment investment.
In the information communication field, the ongoing revolution in information
technologies (IT) can be expected to make a major contribution to invigorating
and raising the general level of efficiency in social and economic activities.
This market has been expanding at an accelerated pace in line with the growing
sophistication, diversification and globalization of needs and has supported
dramatic technological innovations leading to the rapid emergence of the
multimedia age.
Dynamic changes in market structure have intensified the level of competition
throughout the information communication markets. These changes include the
shift from fixed-line to mobile telephones and from voice-based communication to
data communication. Globalization and multimedia developments have extended
this competitive environment to include the markets for international and mobile
communications. Likewise, competition in the regional communication markets has
been intensified by the advances made in GC interconnection and the increasing
number of enterprises providing high-speed Internet access services using ADSL,
wireless and optical fiber technologies.
Given this business environment, NTT West is endeavoring to provide high-quality
and stable services while focusing on the achievement of such
<PAGE>
management goals as "building a profitable structure" and "transformation into
an information sharing company." NTT West has been actively working towards
stabilizing and reinforcing its management foundations by pursing new sources of
revenue and improving customer services.
With regard to new revenue sources, NTT West has started marketing the "i-ai
Plan," a discount service for ISDN-based access to the Internet. The company is
also offering flat-rate Internet access services, such as the "IP connection
service" and the "ADSL Internet access service," on an experimental basis.
Further steps are being taken toward upgrading customer services, including the
"i-Pack" option which offers fixed-amount discounts to customers subscribing to
a multiple number of add-on functions.
NTT West is seeking to secure new sources of income in the solutions business
and has launched the "MI-24" service, an outsourcing service for the maintenance
and operation of information communication systems.
In a related initiative, NTT SmartConnect Corp. was launched on March 1, 2000 as
a wholly owned subsidiary of NTT West. The aim of the new company is to enable
the NTT West Group to develop speedy and strategic responses in the field of IP-
related businesses.
One of the themes in the improvement of customer services has been the
adjustment of service formats to match the needs of increasingly diverse and
changing lifestyles, such as the growing number of double-career households. To
reach out to such customers, the operating hours of the "dial 116" service has
been extended to include Saturdays, Sundays and holidays.
In a similar move, NTT West has launched the "NTT West Net-116" service which
allows customers to apply for ISDN and standard telephone lines via the
Internet. Customers are now able to go on-line to choose a new telephone number
and to designate an installation date.
NTT West is firmly committed to improving management and operational
efficiencies. On November 17, 1999, the company announced its "Mid-term
Restructuring Plan" covering the three-year period between fiscal years 2000 and
2002. Preparations are now being made for the launch of this plan which
<PAGE>
features the streamlining of management and operational functions, personnel
reduction through reassignment and other measures, cutbacks in plant and
equipment investment, and reductions in consignment charges and other expenses.
NTT West is also concerned with environmental issues and has formulated the "NTT
West Global Environmental Charter" and a concrete action program to give
direction to its environmental protection activities.
With regard to the Y2K problem, NTT West implemented various preventive measures
and developed extensive contingency plans. The company spared no efforts in
preparation for critical dates (when Y2K problems were most likely to occur) at
the end and start of the year and again on February 29, and was in position to
take speedy and comprehensive action in case of trouble. As a result of these
efforts, no problems occurred with repercussions on the telecommunications field
and NTT West was able to maintain stable and uninterrupted services throughout
the period.
NTT West's financial performance during the period under review was as follows:
operating revenues amounted to 2,071.6 billion yen, and ordinary loss amounted
to 43.0 billion yen.
During the period under review, NTT West registered special losses related to a
365.9 billion yen addition to retirement allowance reserves. As a result, net
loss came to 239.2 billion yen.
<PAGE>
Attachment 2
NON-CONSOLIDATED BALANCE SHEET
------------------------------
(Based on Japanese Accounting Principles)
<TABLE>
<CAPTION>
March 31, 2000
--------------
Millions Millions
of Yen of US$
------ ------
<S> <C> <C>
Assets
- ------
Fixed assets 4,179,148 39,425
Current assets 933,381 8,805
Total assets 5,112,529 48,231
========= ======
Liabilities
- -----------
Long-term liabilities:
Long-term debt 974,427 9,192
Liability for employees' severance payments 1,406,462 13,268
Other 11,293 106
Total long-term liabilities 2,392,182 22,567
--------- ------
Current liabilities:
Current portion of long-term debt 87,404 824
Accounts payable, trade 280,949 2,650
Short-term borrowings 122,212 1,152
Accrued taxes on income 435 4
Other 347,287 3,276
Total current liabilities 838,288 7,908
--------- ------
Total liabilities 3,230,470 30,476
--------- ------
Shareholders' equity
- --------------------
Common stock 312,000 2,943
Additional paid-in capital 1,562,995 14,745
Unappropriated retained earnings 7,063 66
Total shareholders' equity 1,882,059 17,755
--------- ------
Total liabilities and shareholders' equity 5,112,529 48,231
========= ======
</TABLE>
Note: Yen amounts have been translated, for convenience only, at
(Yen)106=US$1.00, the approximate exchange rate on March 31, 2000.
Fractions are rounded down.
<PAGE>
Attachment 3
NON-CONSOLIDATED STATEMENT OF INCOME
------------------------------------
(Based on Japanese Accounting Principles)
<TABLE>
<CAPTION>
Nine-Months
-----------
Ended March 31, 2000
--------------------
Millions Millions
of Yen of US$
------ -------
<S> <C> <C>
Operating revenues 2,071,622 19,543
Operating expenses 2,099,448 19,806
Operating loss 27,825 262
Non-operating revenues 29,346 276
Non-operating expenses 44,552 420
Ordinary loss 43,031 405
Extraordinary loss 365,951 3,452
Loss before taxes 408,983 3,858
Income taxes
Current 453 4
Deferred (170,200) (1,605)
Net loss 239,236 2,256
------- -----
Per share data (in exact) of Yen of US$
------ ------
Net loss 38,339 361
</TABLE>
Note: Yen amounts have been translated, for convenience only, at
(Yen)106=US$1.00, the approximate exchange rate on March 31, 2000.
Fractions are rounded down.
<PAGE>
Attachment 4
NON-CONSOLIDATED STATEMENT OF CASH FLOWS
----------------------------------------
(Based on Japanese Accounting Principles)
<TABLE>
<CAPTION>
Nine-Months
-----------
Ended March 31, 2000
--------------------
Millions Millions
of Yen of US$
------ ------
<S> <C> <C>
Cash flows from operating activities:
Loss before taxes (408,983) (3,858)
Depreciation and amortization 462,159 4,359
Loss on sale or disposal of property, plant and equipment 57,801 545
Increase (decrease) in liability for employees' severance payments 348,953 3,292
(Increase) decrease in notes and accounts receivable, trade ( 81,368) ( 767)
Increase (decrease) in accounts payable, trade and accrued payroll 311,779 2,941
(Increase) decrease in receivable consumption tax (166,271) (1,568)
Other 51,345 484
--------------------------------------------------------------------------------------------------------------
575,416 5,428
--------------------------------------------------------------------------------------------------------------
Proceeds from interest and dividends 103 0
Payments for interest (18,681) (176)
Payments for taxes on income (17) (0)
--------------------------------------------------------------------------------------------------------------
Net cash provided by operating activities 556,820 5,253
--------------------------------------------------------------------------------------------------------------
Cash flows from investing activities:
Payments for property, plant and equipment (383,228) (3,615)
Acquisition of investments (961) (9)
Other 1,899 17
--------------------------------------------------------------------------------------------------------------
Net cash used in investing activities (382,290) (3,606)
--------------------------------------------------------------------------------------------------------------
Cash flows financing activities:
Proceeds from issuance of long-term debt 115,000 1,084
Payments for settlement of long-term debt (45,345) (427)
Other (43,456) (409)
--------------------------------------------------------------------------------------------------------------
Net cash provided (used) by financing activities 26,198 247
--------------------------------------------------------------------------------------------------------------
Net increase (decrease) in cash and cash equivalents 200,727 1,893
Cash and cash equivalents at beginning of year 2,491 23
--------------------------------------------------------------------------------------------------------------
Cash and cash equivalents at end of year 203,219 1,917
==============================================================================================================
</TABLE>
Note: Yen amounts have been translated, for convenience only, at (Yen)
106=US$1.00, the approximate exchange rate on March 31, 2000. Fractions
are rounded down.
The above figures represent the results after the business transfer from
Nippon Telegraph and Telephone Corporation.
<PAGE>
Attachment 5
PROPOSAL OF APPROPRIATION OF UNAPPROPRIATED RETAINED EARNINGS
-------------------------------------------------------------
<TABLE>
<CAPTION>
(Millions of Yen)
----------------------------------------------------------------------------------------
Nine-Months
Ended March 31, 2000
----------------------------------------------------------------------------------------
<S> <C>
Unappropriated retained earnings for the year 7,063
Total 7,063
Proposal of appropriation:
Special depreciation reserve 2,618
Profits brought forward 4,445
----------------------------------------------------------------------------------------
</TABLE>
Note: Provision of the special depreciation reserve is in accordance with the
Special Taxation Measures Law. The amount of provision is net of tax.
<PAGE>
Attachment 6
BUSINESS RESULTS (NON-CONSOLIDATED OPERATING REVENUES)
------------------------------------------------------
(Based on Japanese Accounting Principles)
(Millions of Yen)
---------------------------------------------------------
Service Nine-Months Ended
March 31, 2000
---------------------------------------------------------
Voice transmission services 1,510,131
Data transmission services 1,198
Leased circuit services 223,397
Telegram services 31,358
Other services 116,775
Telecommunications 1,882,861
total revenues
---------------------------------------------------------
Related business 188,761
total revenues
---------------------------------------------------------
Total operating revenues 2,071,622
---------------------------------------------------------
Note: Fractions are rounded down.
<PAGE>
Attachment 7
NEW BOARD OF DIRECTORS
----------------------
(Subject to Shareholder's Approval)
President
Kazuo Asada
Senior Executive Vice Presidents
Michio Takeuchi
Michitomo Ueno
Executive Vice Presidents
Junichi Yuuki
Masaaki Kasahara
Senior Vice Presidents
Katsuhiko Fujiwara Tadashi Mizuno Mototane Miyazaki
Kenichi Nishimura Tsutomu Ebe Yuji Tatsumura
Kanji Koide
Corporate Auditors
Shigeo Ichihashi Sadayoshi Ishikawa Susumu Urata
Note: The first three members of this list are nominated for positions with
representative authority.
<PAGE>
May 26, 2000
FOR IMMEDIATE RELEASE
NTT Communications Announces Financial Results
for Fiscal Year Ended March 31, 2000
NTT Communications Corporation (NTT Com) announced today the non-consolidated
financial results for its fiscal year ended March 31, 2000. Operating revenue
was 1,075.3 billion yen, recurring profit was 127.7 billion yen, and net income
was 72.8 billion yen.
The telecommunications market witnessed continued proliferation of the Internet
and further shifts in market structure from fixed to wireless connections and
from voice to data communication. Competition took place across industries and
national borders. The industry remained in the midst of an information
technology (IT) revolution of unexpected proportions, spurred by the Internet's
growth. This led to impressive gains in productivity and new business
opportunities, helping to stimulate corporation activity in what is being called
a new economy. Education, entertainment and even daily life underwent great
changes, while government institutions and public services became more efficient
and transparent.
The Japanese and other Asian economies generally showed signs of recovery that
were partly driven by IT investment.
BUSINESS ACTIVITIES IN FISCAL 1999
NTT Com began operating on July 1, 1999 as a new challenger in the global
telecommunications market, aiming to provide high-quality, global-scale services
for a broad customer base.
Business Development
The three main goals of the company have been to expand Internet-protocol (IP)
<PAGE>
services via the Internet and company networks; b) develop global business by
constructing networks and providing services worldwide, and c) strengthen
competitiveness in existing service areas, such as telephone.
For IP services, NTT Com constructed and provided new information distribution
platforms by actively partnering with domestic and international companies.
As part of global business development, the company provided seamless, one-stop
solutions in the domestic and international markets under the Arcstar brand
name.
NTT Com strengthened the competitiveness of its existing services, mainly
telephone, by improving quality and reducing charges. Also, the firm expanded
opportunities for direct contact with its customers by opening call centers and
establishing a sales agency network. International telephone services were
commenced.
NTT Com announced its "dot-com" declaration in March 2000 to clarify the
company's basic strategy for future IP services. The strategy emphasizes IP
services and developing new models for business and lifestyles for its
customers.
Management Reform
"Our Business Philosophy" (OBP) was announced to clarify the firm's mission,
values and standards of behavior. In the OBP, customer values and benefits were
made the first priority, and seven key values, including creative self-
innovation and professionalism, were shared with all employees. These values
also define the behavior of NTT Com employees toward their customers, partners
and the local communities they serve.
NTT Com began internationalizing its human resources management through measures
such as performance-based evaluation and hiring skilled professionals.
RESULTS IN FISCAL 1999
The company accomplished most of its business goals for the year, such as the
<PAGE>
diversification and reduction of charges for its Open Computer Network (OCN)
Internet connection service, tie-ups and investments involving other carriers
and IP operators for IP and international telephone services, commencement of
the 0033-prefix international telephone service, expansion of Arcstar services
coverage, discount of leased-line services, and creation of a new corporate
culture.
Business Results
Charges were reduced for the "OCN Dial Access" service and a new charge plan,
"OCN Natural," was introduced under OCN services, the foundation of the
company's future IP services development. The "Housing Connection Service" was
launched to host and manage customer servers at NTT Com facilities. Monthly
rates were reduced for the "OCN Economy," "Super OCN" and "Business OCN"
services, and startup charges for the "OCN Dial Access" service and other
services were eliminated. NTT Com also introduced "OCN PC Pack" to help
customers begin using the Internet easily and inexpensively, which helped to
increase Internet users. "OCN Dial Access" users surpassed one million in
February 2000.
NTT Com introduced "Arcstar 21," an Internet-protocol virtual private network
(IP-VPN) service for intra-group communication with registered partners via the
"Super Relay FR" and "Super Relay CR" services. In addition, Internet connection
via "Arcstar 21" was commenced.
NTT Com introduced "Arcstar Direct," an ISDN access service that realizes low-
cost communications by connecting customers' domestic and international leased
lines to NTT Com's inter-prefectural networks directly.
In September 1999, NTT Com introduced a new Arcstar Voice Network service plan
for corporate users, called "Premierplan," which enables users to combine
various discount plans based on distance and time zone, contract term and usage
volume.
NTT Com launched the "Shabericchi" service to provide 40% discounts on telephone
calls (regardless of time/day) to two user-designated telephone numbers outside
of the user's prefecture. The monthly fee for the service is 200
<PAGE>
yen.
The Service Level Agreement (SLA) was introduced for the "High-Speed Digital
Leased Circuit," "ATM Mega Link," "Super Relay FR," and "Super OCN" services.
The SLA guarantees service quality, including network quality and repair time.
NTT Com began its international telephone service using the dialing prefix
"0033" from October 1999. As of the end of March 2000, the service was connected
to 231 countries and regions.
Since September 1997, global telecommunications services have been provided to
enterprises under the Arcstar brand. Services were available for 47 areas as of
the end of March 2000.
In view of increasing demand for low-cost leased-line services due to the growth
of the Internet and corporate networks, NTT Com reduced charges for its long-
distance "High-Speed Digital Leased Circuit" and "ATM Mega Link" services in
October 1999, and for the medium- to high-bandwidth "ATM Mega Link" service in
March 2000. Service areas for the "High-Speed Digital International Leased
Circuit Service" were expanded to 16 this February.
The company focused on the formation of global-scale partnerships. It carried
out investments and strategic partnerships, including business tie-ups, with
companies including HKNet Company Limited, a major Internet service provider in
Hong Kong, Philippine Long Distance Telephone Company (PLDT), the Philippines'
largest telecommunications carrier, and the Davnet Limited Group, an Australian
IP-based service provider. NTT Com began the joint preparations for one-stop
outsourcing of design, construction, information system management with
companies including Computer Associates International, Inc., IBM Corporation and
Tivoli Systems Inc. In March 2000, NTT Com invested in and transferred satellite
ownership to Japan Satellite Systems Inc. (JSAT Inc. as of April 2000) to
develop business in the satellite field.
Management Reform Results
"Our Business Philosophy" was introduced for all employees, new personnel and
evaluation systems were put in place, professionals were hired, and new
<PAGE>
employee education programs were adopted, all of which served to establish a
foundation for a new corporate culture in tune with the global business
environment.
All financial information stated in this release have been prepared on the basis
of Japanese accounting principles.
# # #
For further information, please contact:
Ms. Megumi Inaji or Mr. Fuyuki Natsumeda
Public Relations Office
NTT Communications Corporation
Telephone: +81 (3) 3500-8020
E-mail: [email protected]
<PAGE>
Attachment 1
NTT Communications Corporation
------------------------------
NON-CONSOLIDATED BALANCE SHEET
------------------------------
(Based on Japanese accounting principles)
<TABLE>
<CAPTION>
March 31, 2000
--------------
Millions Millions
of Yen of US$
------ ------
<S> <C> <C>
ASSETS
- ------
Fixed assets 963,200 9,086
Current assets 457,652 4,317
Total assets 1,420,853 13,404
========= ======
LIABILITIES
- -----------
Long-term liabilities:
Long-term debt 409,487 3,863
Liability for employees' severance payments 61,406 579
Other 1,158 10
Total long-term liabilities 472,052 4,453
------- -----
Current liabilities:
Current portion of long-term debt 31,068 293
Accounts payable, trade 50,491 476
Short-term borrowings 37,611 354
Accounts payable, other 198,689 1,874
Accrued taxes on income 75,490 712
Other 37,335 352
Total current liabilities 430,686 4,063
------- -----
TOTAL LIABILITIES 902,739 8,516
------- -----
SHAREHOLDERS' EQUITY
- --------------------
Common stock 72,000 679
Additional paid-in capital 361,968 3,414
Unappropriated retained earnings 84,145 793
TOTAL SHAREHOLDERS' EQUITY 518,114 4,887
------- -----
TOTAL LIABILITIES AND
SHAREHOLDERS' EQUITY 1,420,853 13,404
========= ======
</TABLE>
Note: Yen amounts have been translated, for convenience only, at
(Yen)106=US$1.00, the approximate exchange rate on March 31, 2000.
Fractions are rounded down.
<PAGE>
Attachment 2
NTT Communications Corporation
------------------------------
NON-CONSOLIDATED STATEMENT OF INCOME
------------------------------------
(Based on Japanese accounting principles)
FISCAL YEAR BEGINNING MAY 28, 1999 AND
--------------------------------------
ENDED MARCH 31, 2000
--------------------
Millions Millions
of Yen of US$
---------- ---------
Operating revenues 1,075,302 10,144
Operating expenses 945,749 8,922
Operating income 129,552 1,222
Non-operating revenues 19,269 181
Non-operating expenses 21,103 199
Recurring profit 127,719 1,204
Extraordinary profit 16,832 158
Extraordinary loss 18,106 170
Income before taxes 126,445 1,192
Income taxes
Current 75,500 712
Deferred (21,900) (206)
Net income 72,845 687
--------- ------
Per share data (in exact) of Yen of US$
--------- ------
Net income 50,587 477
Cash dividend 42,500 400
Note: Yen amounts have been translated, for convenience at(Yen)=US$1.00 the
approximate exchange rate on March 31, 2000. Fractions are rounded down.
<PAGE>
Attachment 3
NTT Communications Corporation
------------------------------
NON-CONSOLIDATED STATEMENT OF CASH FLOWS
----------------------------------------
(Based on Japanese accounting principles)
<TABLE>
<CAPTION>
FISCAL YEAR BEGINNING JULY 1, 1999 AND
--------------------------------------
ENDED MARCH 31, 2000
--------------------
Millions Millions
of Yen of US$
------ --------
<S> <C> <C>
Cash flows from operating activities:
Income before taxes 126,445 1,192
Depreciation and amortization 92,565 873
Loss on sale or disposal of property, plant and equipment 8,992 84
Increase (decrease) in liability for employees' severance payments 16,903 159
(Increase) decrease in notes and accounts receivable, trade (234,917) (2,216)
Increase (decrease) in accounts payable, trade and accrued payroll 192,977 1,820
(Increase) decrease in receivable consumption tax (20,295) (191)
Other 4,796 45
- ------------------------------------------------------------------------------------------------------------------------------
187,468 1,768
- ------------------------------------------------------------------------------------------------------------------------------
Proceeds from interest and dividends 56 0
Payments for interest (7,057) (66)
Payments for taxes on income (9) (0)
- ------------------------------------------------------------------------------------------------------------------------------
Net cash provided by operating activities 180,458 1,702
- ------------------------------------------------------------------------------------------------------------------------------
Cash flows from investing activities:
Payments for property, plant and equipment (59,109) (557)
Acquisition of investments (94,482) (891)
Other 20,714 195
- ------------------------------------------------------------------------------------------------------------------------------
Net cash used in investing activities (132,877) (1,253)
- ------------------------------------------------------------------------------------------------------------------------------
Cash flows financing activities:
Proceeds from issuance of long-term debt 104,000 981
Payments for settlement of long-term debt (73,593) (694)
Other 33,200 313
- ------------------------------------------------------------------------------------------------------------------------------
Net cash provided (used) by financing activities 63,606 600
- ------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in cash and cash equivalents 111,187 1,048
Cash and cash equivalents at beginning of year 399 3
- ------------------------------------------------------------------------------------------------------------------------------
Increase due to merger 788 7
- ------------------------------------------------------------------------------------------------------------------------------
Cash and cash equivalents at end of year 112,375 1,060
- ------------------------------------------------------------------------------------------------------------------------------
</TABLE>
Note: Yen amounts have been translated, for convenience only,
at(Yen)106=US$1.00, the approximate exchange rate on March 31, 2000.
Fractions are rounded down. Posted figures follow the business transfer
from Nippon Telegraph and Telephone Corporation. However, income before
taxes and other figures were calculated from the point of NTT Com's
establishment.
<PAGE>
Attachment 4
PROPOSAL OF APPROPRIATION OF UNAPPROPRIATED RETAINED EARNINGS
-------------------------------------------------------------
(Millions of Yen)
- --------------------------------------------------------------------------------
Fiscal Year Beginning
May 28, 1999 and
Ended March 31, 2000
- --------------------------------------------------------------------------------
Unappropriated retained earnings for the year 84,145
Total 84,145
Proposal of appropriation:
Legal earned reserve 6,122
Cash dividends 61,200
((YEN)42,500 per share)
Bonuses to directors and corporate auditors 18
(Portion to corporate auditors) (4)
Special depreciation reserve 991
Profits brought forward 15,815
- --------------------------------------------------------------------------------
Note: Provision of the special depreciation reserve is in accordance with the
Special Taxation Measures Law. The amount of provision is net of tax.
<PAGE>
Attachment 5
BUSINESS RESULTS (NON-CONSOLIDATED OPERATING REVENUES)
------------------------------------------------------
(Based on Japanese accounting principles)
(Millions of Yen)
- --------------------------------------------------------------------------------
Fiscal Year Beginning
Service May 28, 1999 and
Ended March 31, 2000
- --------------------------------------------------------------------------------
Voice transmission services 656,331
Data transmission services 158,430
Leased circuit services 184,303
Other services 2,851
Telecommunications 1,001,916
total revenues
- --------------------------------------------------------------------------------
Related business
total revenues 73,385
- --------------------------------------------------------------------------------
Total operating revenues 1,075,302
- --------------------------------------------------------------------------------
Note: Fractions are rounded down.
<PAGE>
Attachment 6
NTT Communications' New Board of Directors
------------------------------------------
(subject to shareholders' approval)
President & CEO
Masanobu Suzuki
Senior Executive Vice Presidents
Tadayuki Arai
Katsuya Okimi
Executive Vice President
Mamoru Ishida
Shuji Tomita
Senior Vice Presidents
Satoshi Fujita Yuichi Kawamori Hideya Inoue
Isamu Satoki Shunsuke Amiya Yoshio Sakata
Hisao Iizuka Kiyoshi Isozaki Hiromi Wasai
Auditors
Hidesada Toriyama Akio Tsuchiya Nobuyuki Tanahashi
Note: The first three members of this list are nominated for positions with
representative authority.
