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* Telecommunications — R&D and production equip- ment for optical transmission systems and next-generation mobile communications sys- tems 

* Electronic devices — Advanced logic development line, logic and flash memory production facilities, and SAW filter mass-production facilities 

## Financial Condition and Liquidity 

Total assets at March 31, 2000 stood at ¥5,134.6 billion ($48,440 million), up ¥22.3 billion from the end of previ- ous fiscal year. This rise was owing to the increase in lease assets resulting from the inclusion of Fujitsu Leasing as a consolidated subsidiary. Excluding this factor, total assets decreased approximately ¥300.0 billion, attributable pri- marily to our efforts to slim overall current assets through effective use of excess cash, successful collection of accounts receivable, reduction of inventories, and other means. 

By slimming current assets and thanks to aggressive conversion of convertible bonds into stock, interest-bearing liabilities were reduced by ¥202.2 billion, to ¥1,725.0 bil- lion ($16,274 million), despite an increase of ¥205.3 billion relating to the consolidation of Fujitsu Leasing. 

Shareholders' equity increased ¥126.1 billion, to ¥1,291.4 billion ($12,183 million), due to the conversion 

## Shareholders‘ Equity 

(¥ Billion) 

<img src='content_image/104947.jpg'>

## Cash Flows from Operating Activities 

(¥ Billion) 

<img src='content_image/104948.jpg'>

of convertible bonds into shares, as well as exercise of stock purchase warrants. The shareholders' equity ratio rose from 22.8% to 25.2%, and shareholders' equity per share, based on the number of shares outstanding at year- end, was ¥657.9 ($6.207), compared with ¥618.5 the previous year. 

## Cash Flows 

Net cash provided by operating activities increased ¥77.3 billion, to ¥477.0 billion ($4,500 million). This rise resulted from an increase in overall profit and the slimming of cur- rent assets. 

Primarily because of a decrease in investments and long-term loans, net cash used in investing activities fell ¥60.4 billion, to ¥348.2 billion ($3,285 million). 

Stemming from the factors described above, the differ- ence between cash provided by operating activities and cash used in investing activities (free cash flow) improved ¥137.7 billion from the –¥9.0 billion of fiscal 1998, result- ing in positive cash flow of ¥128.7 billion ($1,214 million). 

As a result of a reduction in interest bearing liabilities, net cash used in financing activities stood at ¥271.2 billion ($2,558 million), down ¥340.4 billion from the previous year. 

## Consolidated Subsidiaries 

As of March 31, 2000, Fujitsu's consolidated subsidiaries numbered 493, of which 134 were based in Japan and 359 overseas. In April 1999, we established Fujitsu Hitachi Plasma Display Co., Ltd. as a specialized manufacturer of PDP devices. In January 2000, we created Internet Trading Securities Inc. Also, we have included Fujitsu Leasing in our consolidation. Despite these increases in the number of consolidated subsidiaries, our former European PC sales and marketing subsidiary, Fujitsu Computers (Europe) Limited, was united in a joint venture company with a unit of Siemens of Germany, and overall, the number of sub- sidiaries decreased by 25 during the year, from 518 at the end of fiscal 1998. 

