UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 6-K

PIONEER CORPORATION

(Translation of registrant’s name into English)

4-1, MEGURO 1-CHOME, MEGURO-KU, TOKYO 153-8654, JAPAN
(Address of principal executive offices)

Indicate by check mark whether the registrant files or will file annual reports under cover Form 20-F or Form 40-F:

Form 20-F þ    Form 40-F o

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): o

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): o

Indicate by check mark whether by furnishing the information contained in this Form, the registrant is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.

Yes o    No þ

If “Yes” is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b): 82-

 

 

SIGNATURES

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.

				PIONEER CORPORATION
				(Registrant)
Date: October 31, 2005
		By		/s/ Kaneo Ito
				Kaneo Ito
				President and Representative Director

This report on Form 6-K contains the followings:

1.

The announcement released by the Company to the press in Japan dated October 31 2005, concerning its consolidated second-quarter and semiannual business results, and non-consolidated semiannual business results, for the period ended September 30, 2005.

For Immediate Release
October 31, 2005           

Pioneer Announces Second-Quarter and Semiannual Results for Fiscal 2006

TOKYO — Pioneer Corporation today announced its consolidated second-quarter and semiannual business results, and non-consolidated semiannual business results, for the period ended September 30, 2005.

Consolidated Financial Highlights

		(In millions of yen except per share information)
		Three months												Six months
		ended September 30												ended September 30
		2005				2004				% to prior year				2005				2004				% to prior year
Operating revenue		¥	185,715			¥	181,560				102.3	%		¥	349,898			¥	345,047				101.4	%
Operating income (loss)			(7,519	)			8,386				—				(16,388	)			13,398				—
Income (loss) before income taxes			(5,345	)			8,199				—				(11,954	)			12,438				—
Net income (loss)		¥	(6,918	)		¥	3,312				—			¥	(12,261	)		¥	4,809				—
Net income (loss) per share:
Basic		¥	(39.66	)		¥	18.88							¥	(70.29	)		¥	27.41
Diluted		¥	(39.66	)		¥	16.99							¥	(70.29	)		¥	24.45

Note:		Effective from fiscal 2005 year-end presentation, the Company classified gains and losses on sale and disposal of fixed assets, which were previously included in “Operating costs and expenses,” into “Other income (expenses).” Previously reported amounts have been reclassified accordingly.

Consolidated Business Results

The second quarter of fiscal 2006, ended September 30, 2005, resulted in consolidated operating revenue of ¥185,715 million (US$1,643.5 million), a 2.3% increase from the corresponding period in the previous year. This mainly reflects increased sales of plasma displays, which compensated for decreased sales of DVD products. Despite an increase in operating revenue, operating loss of ¥7,519 million (US$66.5 million) was posted during the period, compared to operating income of ¥8,386 million in the corresponding period of the previous year. This loss was principally caused by lower market prices for our main products due to more severe competition, resulting in decrease of gross profit margins. As a result, net loss was ¥6,918 million (US$61.2 million) compared with net income of ¥3,312 million posted in the corresponding period of the previous year. The average value of the yen during the period was down 1.2% against the U.S. dollar and down 1.0% against the euro from the corresponding period in the previous year.

Home Electronics sales increased 6.6% from the corresponding period in the previous year to ¥81,753 million (US$723.5 million), as plasma display sales increased, despite a decrease in sales of DVD products. In Japan, sales decreased 15.9% to ¥19,028 million (US$168.4 million) mainly due to a decrease in sales of DVD recorders and DVD players. Overseas sales increased 16.0% to ¥62,725 million (US$555.1 million), due to a rise in sales of plasma displays worldwide, and of DVD drives for PCs in Asia, despite the decline in sales of DVD drives for PCs in Europe and North America and the discontinuation of sales of cable TV set-top boxes in North America.

     This business segment recorded operating loss of ¥13,140 million (US$116.3 million), compared to operating income of ¥32 million in the corresponding period of the previous year. Gross profit margins for plasma displays and DVD products dropped due to lower market prices.

Car Electronics sales amounted to ¥78,140 million (US$691.5 million), up 4.5% over the corresponding period in the previous year. Car audio product sales were good, although car navigation system sales decreased, due to lower sales in Japan of these systems to automobile manufacturers. In Japan, sales decreased 10.9% to ¥26,236 million (US$232.2 million), due to a decrease in sales of car navigation systems to automobile manufacturers, which reflected a lack of new car model launches in comparison to the corresponding period of the previous year, despite an increase in sales of car navigation systems for the consumer market. Overseas sales increased 14.5% to ¥51,904 million (US$459.3 million), due to growth in sales of car audio products and car navigation systems to automobile manufacturers in North America, and of car audio products for the consumer market in Central and South America and Europe.

     Operating income decreased 37.8% to ¥2,896 million (US$25.6 million) over the corresponding period of the previous year, mainly as a result of the above-mentioned decrease in sales of car navigation systems.

Royalty revenue from Patent Licensing increased 7.7% from the corresponding period in the previous year to ¥4,162 million (US$36.8 million), due to the revenue from renewed contracts with licensees, despite the decline in royalty revenue resulting from the expiration of patents included in a portfolio of patents licensed to the optical disc industry.

     Operating income decreased 6.4% to ¥3,598 million (US$31.8 million) over the corresponding period of the previous year.

Others sales decreased 17.3% from the corresponding period in the previous year to ¥21,660 million (US$191.7 million), mainly as a result of a drop in sales of optical disc manufacturing systems in Asia. In Japan, sales decreased 12.1% to ¥11,476 million (US$101.6 million) reflecting a sales shift from Japan to China of devices for cellular phones and a decrease in sales of factory automation systems. Overseas, sales decreased 22.5% to ¥10,184 million (US$90.1 million), due to a drop in sales of optical disc manufacturing systems in Asia, despite an increase in sales of devices for cellular phones in China.

     Operating loss of ¥566 million (US$5.0 million) was posted, compared to operating income of ¥987 million in the corresponding period of the previous year. This loss was principally caused by a decrease in sales.

Semiannual results — Consolidated operating revenue for the six-month period ended September 30, 2005 was ¥349,898 million (US$3,096.4 million), a 1.4% increase over the corresponding period in the previous year. Net loss of ¥12,261 million (US$108.5 million) was posted for the period, compared to net income of ¥4,809 million in the corresponding period of the previous year.

Note:		Operating income (loss) in each business segment represents operating income (loss) recorded before intersegment transactions are eliminated.

Cash Flows

Net cash provided by operating activities for the second quarter ended September 30, 2005 was ¥2,280 million (US$20.2 million), an increase of ¥635 million from ¥1,645 million for the corresponding period of the previous year. Although net loss of ¥6,918 million was posted this quarter, trade and other payables increased, and resulted in more cash provided for operating activities. Net cash used for investing activities was ¥7,001 million (US$62.0 million), a decrease of ¥42,277 million from the corresponding period of the previous year, which included an acquisition of a plasma display production subsidiary. Net cash used in financing activities was ¥4,217 million (US$37.3 million), compared with ¥815 million cash provided in the corresponding period of the previous year. The difference resulted mainly from redemption of bonds in the quarter under review.

Corporate Policy and Dividend Policy

Customer satisfaction is our highest priority. In keeping with Pioneer group’s philosophy to “Move the Heart and Touch the Soul,” we strive to develop and provide advanced, high-quality, value-added electronics products that deliver satisfaction, comfort and convenience, and create new forms of entertainment.

An interim dividend of ¥7.5 (US$0.07) per share of common stock, a decrease of ¥5.0 from that for the corresponding period last year, will be paid to the Company’s shareholders of record as of September 30, 2005 (Japan time).

     Based on its policy aimed at dividend continuance and stability, the Company determines an appropriate dividend amount, taking into consideration the Company’s financial condition, consolidated business results and other factors. The decision to lower the latest interim dividend reflects the impact to the Company of continued severe business conditions.

Addressing Current Challenges

The business environment remains severe, characterized by uncertain economic conditions, particularly as the rising prices of crude oil and other raw materials may exert negative impact on the economies of Japan and the U.S., in which consumer spending had been steady. Also, price competition is increasingly tough in markets for our key products.

Despite these difficult conditions, we are committed to becoming profitable again by reviewing every aspect of our major business fields, reinvesting our resources in advanced, high-quality, value-added products that identify the core value of our Company, and enhancing our brand equity.

In the plasma display business, we have been reinforcing our production capacity, as the market rapidly expands. Incoming orders, however, did not reach the levels we had planned for in the OEM (original equipment manufacturing) plasma display business, so we decided to adjust total production output until demand recovers. As we keep cutting costs extensively, we will continue to develop and launch unique products of superior innovation, performance and function. We are making efforts to enhance the value and strength of the Pioneer brand and to expand plasma display sales.

In the DVD business, the market is rapidly expanding, especially in DVD recorders and DVD drives for PCs, while product prices are falling sharply. To overcome the competition, we must introduce more advanced products as early as possible, in addition to carrying out more cost cutting in production in China. We are aggressively reviewing our development and design process, aiming to enhance speed and efficiency of development, and to precede our competitors in supplying markets with products that customers welcome.

In the car electronics business, we are determined to maintain a leading position in the consumer market by reinforcing our car audio operations in the fast-growing markets of China, Central and South America and Russia. Developing products that differentiate us from our industry competitors will help extend the value of our brand. Our car navigation operations are renowned in Japan, where our sales efforts are as aggressive as ever. We are making a similarly bold push to fortify and extend our operations for this business in Europe and North America. In our business with automobile manufacturers, we are capitalizing on our product planning expertise in the consumer market, and propose innovative products to open up new business opportunities and increase sales.

The entire Pioneer Group is intensely focusing on cost reduction. Along with our ongoing efforts to improve management efficiency, we are advancing discussion on a restructuring that may include renewal of the Pioneer group business structure, as well as consequent consolidation of plants and offices and review of staffing. These measures, plus inventory reduction through better supply chain management, will help us return to profitability and improve cash flows.

Business Forecasts for Fiscal 2006

Our consolidated business forecasts for fiscal 2006, ending March 31, 2006, are unchanged from those announced on October 21, 2005, which are shown below. We assume average yen-U.S. dollar and yen-euro exchange rates for the remaining period of fiscal 2006 of ¥110 and ¥135, respectively.

(In millions of yen)

		Projections for				Results for				Percent
		fiscal 2006				fiscal 2005				changes
Operating revenue		¥	770,000			¥	733,648				+5.0	%
Operating income (loss)			(25,000	)			2,592				—
Loss before income taxes			(28,000	)			(187	)			—
Net loss		¥	(24,000	)		¥	(8,789	)			—

In addition to our ongoing efforts to enhance management efficiency, we are currently advancing discussions on business restructuring. The expenses (non-operating) required for such business restructuring, however, are not included in these forecasts. Details of the restructuring will be announced in late November or after.

Cautionary Statement with Respect to Forward-Looking Statements

Statements made in this release with respect to our current plans, estimates, strategies and beliefs, and other statements that are not historical facts are forward-looking statements about our future performance. These statements are based on management’s assumptions and beliefs in light of the information currently available to it. We caution that a number of important risks and uncertainties could cause actual results to differ materially from those discussed in the forward-looking statements, and therefore you should not place undue reliance on them. You also should not believe that it is our obligation to update or revise any forward-looking

statements, whether as a result of new information, future events or otherwise. We disclaim any such obligation. Risks and uncertainties that might affect us include, but are not limited to, (i) general economic conditions in our markets, particularly levels of consumer spending; (ii) exchange rates, particularly between the yen and the U.S. dollar, euro, and other currencies in which we make significant sales or in which our assets and liabilities are denominated; (iii) our ability to continue to design and develop and win acceptance of our products and services, which are offered in highly competitive markets characterized by continual new product introductions, rapid developments in technology, severe price competition and subjective and changing consumer preferences; (iv) our ability to successfully implement our business strategies; (v) our ability to compete, and develop and implement successful sales and distribution strategies in light of technological developments in and affecting our businesses; (vi) our continued ability to devote sufficient resources to research and development, and capital expenditure; (vii) our ability to continuously enhance our brand image; (viii) the success of our joint ventures and alliances; and (ix) the outcome of contingencies.

Pioneer Corporation is one of the leading manufacturers of consumer- and business-use electronics products such as audio, video and car electronics on a global scale. Its shares are traded on the New York Stock Exchange (ticker symbol PIO), Euronext Amsterdam, Tokyo Stock Exchange, and Osaka Securities Exchange.

#   #   #   #   #   #

The U.S. dollar amounts in this release represent translation of Japanese yen, for convenience only, at the rate of ¥113=US$1.00, the approximate rate prevailing on September 30, 2005.

Attachments:

	I.		Consolidated financial statements for the three months and the six months ended September 30, 2005
	II.		Non-consolidated financial statements for the six months ended September 30, 2005

For further information, please contact:
Investor Relations Department, Corporate Branding and Communications Division
Pioneer Corporation, Tokyo
Phone: +81-3-3495-6774 / Fax: +81-3-3495-4301
E-mail: pioneer_ir@post.pioneer.co.jp
IR Website: http://www.pioneer.co.jp/ir-e/

Pioneer Corporation and Subsidiaries

I.		CONSOLIDATED FINANCIAL STATEMENTS
		FOR THE THREE MONTHS AND THE SIX MONTHS ENDED SEPTEMBER 30, 2005

(1) OPERATING REVENUE BY SEGMENT

(In millions of yen)

		Three months ended September 30
		2005								2004								% to
		Amount				% to total				Amount				% to total				prior year
Domestic		¥	19,028				10.2	%		¥	22,633				12.5	%			84.1	%
Overseas			62,725				33.8				54,087				29.8				116.0
Home Electronics			81,753				44.0				76,720				42.3				106.6
Domestic			26,236				14.1				29,453				16.2				89.1
Overseas			51,904				28.0				45,317				25.0				114.5
Car Electronics			78,140				42.1				74,770				41.2				104.5
Domestic			—				—				—				—				—
Overseas			4,162				2.2				3,864				2.1				107.7
Patent Licensing			4,162				2.2				3,864				2.1				107.7
Domestic			11,476				6.3				13,058				7.2				87.9
Overseas			10,184				5.4				13,148				7.2				77.5
Others			21,660				11.7				26,206				14.4				82.7
Domestic			56,740				30.6				65,144				35.9				87.1
Overseas			128,975				69.4				116,416				64.1				110.8
Total		¥	185,715				100.0	%		¥	181,560				100.0	%			102.3	%

(In millions of yen)

		Six months ended September 30
		2005								2004								% to
		Amount				% to total				Amount				% to total				prior year
Domestic		¥	36,068				10.3	%		¥	36,918				10.7	%			97.7	%
Overseas			108,890				31.1				95,555				27.7				114.0
Home Electronics			144,958				41.4				132,473				38.4				109.4
Domestic			56,177				16.1				61,784				17.9				90.9
Overseas			104,176				29.7				92,541				26.8				112.6
Car Electronics			160,353				45.8				154,325				44.7				103.9
Domestic			—				—				—				—				—
Overseas			5,285				1.5				6,739				2.0				78.4
Patent Licensing			5,285				1.5				6,739				2.0				78.4
Domestic			19,918				5.7				25,281				7.3				78.8
Overseas			19,384				5.6				26,229				7.6				73.9
Others			39,302				11.3				51,510				14.9				76.3
Domestic			112,163				32.1				123,983				35.9				90.5
Overseas			237,735				67.9				221,064				64.1				107.5
Total		¥	349,898				100.0	%		¥	345,047				100.0	%			101.4	%

Pioneer Corporation and Subsidiaries

(2) CONSOLIDATED STATEMENTS OF OPERATIONS

(In millions of yen)

		Three months ended September 30
										% to
		2005				2004				prior year
Operating revenue:
Net sales		¥	181,553			¥	177,696				102.2	%
Royalty revenue			4,162				3,864				107.7
Total operating revenue			185,715				181,560				102.3
Operating costs and expenses:
Cost of sales			148,180				133,601				110.9
Selling, general and administrative expenses			45,054				39,573				113.9
Total operating costs and expenses			193,234				173,174				111.6
Operating income (loss)			(7,519	)			8,386				—
Other income (expenses):
Interest income			625				432				144.7
Foreign exchange loss			(323	)			(228	)			141.7
Interest expense			(325	)			(315	)			103.2
Other—net			2,197				(76	)			—
Total other income (expenses)			2,174				(187	)			—
Income (loss) before income taxes			(5,345	)			8,199				—
Income taxes			342				3,937				8.7
Minority interest in losses (earnings) of subsidiaries			718				(270	)			—
Equity in losses of affiliated companies			(1,949	)			(680	)			286.6
Net income (loss)		¥	(6,918	)		¥	3,312				—	%

(In millions of yen)

		Six months ended September 30
										% to
		2005				2004				prior year
Operating revenue:
Net sales		¥	344,613			¥	338,308				101.9	%
Royalty revenue			5,285				6,739				78.4
Total operating revenue			349,898				345,047				101.4
Operating costs and expenses:
Cost of sales			278,393				250,878				111.0
Selling, general and administrative expenses			87,893				80,771				108.8
Total operating costs and expenses			366,286				331,649				110.4
Operating income (loss)			(16,388	)			13,398				—
Other income (expenses):
Interest income			1,252				790				158.5
Foreign exchange loss			(1,065	)			(1,161	)			91.7
Interest expense			(720	)			(689	)			104.5
Other—net			4,967				100				4,967.0
Total other income (expenses)			4,434				(960	)			—
Income (loss) before income taxes			(11,954	)			12,438				—
Income taxes			(1,210	)			5,544				—
Minority interest in losses (earnings) of subsidiaries			1,285				(560	)			—
Equity in losses of affiliated companies			(2,802	)			(1,525	)			183.7
Net income (loss)		¥	(12,261	)		¥	4,809				—	%

Pioneer Corporation and Subsidiaries

(3) CONSOLIDATED BALANCE SHEETS

(In millions of yen)

		September 30												March 31
										Increase/								Increase/
		2005				2004				(Decrease)				2005				(Decrease)
ASSETS
Current assets:
Cash and cash equivalents		¥	107,198			¥	123,936			¥	(16,738	)		¥	116,681			¥	(9,483	)
Trade receivables, less allowance			126,981				119,863				7,118				132,176				(5,195	)
Inventories			126,594				135,504				(8,910	)			109,015				17,579
Others			75,628				74,711				917				69,024				6,604
Total current assets			436,401				454,014				(17,613	)			426,896				9,505
Investments and long-term receivables			25,268				29,553				(4,285	)			28,828				(3,560	)
Property, plant and equipment, less depreciation			203,557				208,964				(5,407	)			210,145				(6,588	)
Intangible assets			22,974				25,590				(2,616	)			24,052				(1,078	)
Other assets			39,393				39,015				378				35,246				4,147
Total assets		¥	727,593			¥	757,136			¥	(29,543	)		¥	725,167			¥	2,426
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Short-term borrowings and current portion of long-term debt		¥	55,560			¥	40,615			¥	14,945			¥	52,428			¥	3,132
Trade payables			104,831				103,031				1,800				96,335				8,496
Others			101,857				104,554				(2,697	)			102,407				(550	)
Total current liabilities			262,248				248,200				14,048				251,170				11,078
Long-term debt			79,512				87,397				(7,885	)			81,219				(1,707	)
Other long-term liabilities			41,705				58,909				(17,204	)			42,371				(666	)
Minority interests			17,085				18,281				(1,196	)			18,168				(1,083	)
Shareholders’ equity:
Common stock			49,049				49,049				—				49,049				—
Capital surplus			82,834				82,612				222				82,735				99
Retained earnings			246,987				276,334				(29,347	)			260,556				(13,569	)
Accumulated other comprehensive income (loss)			(39,390	)			(53,185	)			13,795				(47,669	)			8,279
Treasury stock			(12,437	)			(10,461	)			(1,976	)			(12,432	)			(5	)
Total shareholders’ equity			327,043				344,349				(17,306	)			332,239				(5,196	)
Total liabilities and shareholders’ equity		¥	727,593			¥	757,136			¥	(29,543	)		¥	725,167			¥	2,426
Breakdown of accumulated other comprehensive
income (loss):
Minimum pension liability adjustments		¥	(11,391	)		¥	(21,714	)		¥	10,323			¥	(11,186	)		¥	(205	)
Net unrealized holding gain on securities			7,475				7,516				(41	)			8,250				(775	)
Cumulative foreign currency translation adjustments			(35,474	)			(38,987	)			3,513				(44,733	)			9,259
Total accumulated other comprehensive income (loss)		¥	(39,390	)		¥	(53,185	)		¥	13,795			¥	(47,669	)		¥	8,279

Pioneer Corporation and Subsidiaries

(4) CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY

(In millions of yen)

														Accumulated
														Other								Total
		Common				Capital				Retained				Comprehensive				Treasury				Shareholders’
		Stock				Surplus				Earnings				Income (Loss)				Stock				Equity
Balance at March 31, 2004		¥	49,049			¥	82,464			¥	273,718			¥	(61,829	)		¥	(10,464	)		¥	332,938
Net loss											(8,789	)											(8,789	)
Other comprehensive income															14,160								14,160
Value ascribed to stock options							270																270
Cash dividends (¥25 per share)											(4,373	)											(4,373	)
Purchase and sales of treasury stock, net							1												(1,968	)			(1,967	)
Balance at March 31, 2005		¥	49,049			¥	82,735			¥	260,556			¥	(47,669	)		¥	(12,432	)		¥	332,239
Net loss											(12,261	)											(12,261	)
Other comprehensive income															8,279								8,279
Value ascribed to stock options							99																99
Cash dividends (¥7.5 per share)											(1,308	)											(1,308	)
Purchase and sales of treasury stock, net																			(5	)			(5	)
Balance at September 30, 2005		¥	49,049			¥	82,834			¥	246,987			¥	(39,390	)		¥	(12,437	)		¥	327,043

(5) CONSOLIDATED STATEMENTS OF CASH FLOWS

(In millions of yen)

		Three months								Six months
		ended September 30								ended September 30
		2005				2004				2005				2004
I. Operating activities:
Net income (loss)		¥	(6,918	)		¥	3,312			¥	(12,261	)		¥	4,809
Depreciation and amortization			11,575				10,778				24,122				21,287
(Increase) decrease in trade receivables			(15,718	)			(8,194	)			7,160				415
(Increase) decrease in inventories			1,396				(6	)			(14,635	)			(18,814	)
Increase (decrease) in trade payables			5,607				(76	)			8,016				7,168
Increase (decrease) in other accrued liabilities			10,822				1,545				2,737				(11,185	)
Other			(4,484	)			(5,714	)			(13,919	)			(7,711	)
Net cash provided by (used in) operating activities			2,280				1,645				1,220				(4,031	)
II. Investing activities:
Payment for purchase of fixed assets			(10,355	)			(12,646	)			(19,282	)			(26,284	)
Payment for purchase of subsidiary			—				(36,615	)			—				(36,615	)
Other			3,354				(17	)			7,357				338
Net cash used in investing activities			(7,001	)			(49,278	)			(11,925	)			(62,561	)
III. Financing activities:
Increase (decrease) in short-term borrowings and long-term debt			(3,183	)			1,035				2,866				(3,034	)
Dividends paid			—				—				(2,180	)			(2,193	)
Other			(1,034	)			(220	)			(2,073	)			(323	)
Net cash provided by (used in) financing activities			(4,217	)			815				(1,387	)			(5,550	)
Effect of exchange rate changes on cash and cash equivalents			1,366				1,792				2,609				3,659
Net decrease in cash and cash equivalents			(7,572	)			(45,026	)			(9,483	)			(68,483	)
Cash and cash equivalents, beginning of period			114,770				168,962				116,681				192,419
Cash and cash equivalents, end of period		¥	107,198			¥	123,936			¥	107,198			¥	123,936
Free cash flow (I + II)		¥	(4,721	)		¥	(47,633	)		¥	(10,705	)		¥	(66,592	)

Pioneer Corporation and Subsidiaries

(6) SEGMENT INFORMATION

The following segment information is prepared pursuant to the regulations under the Securities and Exchange Law of Japan.

<Business Segments>

(In millions of yen)

		Three months ended September 30
		2005								2004								% to prior year
		Operating				Operating				Operating				Operating				Operating				Operating
		Revenue				Income				Revenue				Income				Revenue				Income
Home Electronics		¥	82,264			¥	(13,140	)		¥	77,368			¥	32				106.3	%			—	%
Car Electronics			78,516				2,896				75,401				4,658				104.1				62.2
Patent Licensing			4,201				3,598				4,318				3,843				97.3				93.6
Others			31,556				(566	)			37,828				987				83.4				—
Total			196,537				(7,212	)			194,915				9,520				100.8				—
Corporate and Eliminations			(10,822	)			(307	)			(13,355	)			(1,134	)			—				—
Consolidated		¥	185,715			¥	(7,519	)		¥	181,560			¥	8,386				102.3	%			—	%

(In millions of yen)

		Six months ended September 30
		2005								2004								% to prior year
		Operating				Operating				Operating				Operating				Operating				Operating
		Revenue				Income				Revenue				Income				Revenue				Income
Home Electronics		¥	145,772			¥	(25,568	)		¥	133,751			¥	(4,290	)			109.0	%			—	%
Car Electronics			161,124				8,210				155,002				10,974				103.9				74.8
Patent Licensing			5,324				3,969				7,580				6,592				70.2				60.2
Others			59,195				(1,320	)			71,196				2,035				83.1				—
Total			371,415				(14,709	)			367,529				15,311				101.1				—
Corporate and Eliminations			(21,517	)			(1,679	)			(22,482	)			(1,913	)			—				—
Consolidated		¥	349,898			¥	(16,388	)		¥	345,047			¥	13,398				101.4	%			—	%

<Geographic Segments>

(In millions of yen)

		Six months ended September 30
		2005								2004								% to prior year
		Operating				Operating				Operating				Operating				Operating				Operating
		Revenue				Income				Revenue				Income				Revenue				Income
Japan		¥	292,978			¥	(15,665	)		¥	292,347			¥	6,858				100.2	%			—	%
North America			92,524				(1,810	)			84,058				3,073				110.1				—
Europe			66,311				(1,315	)			66,208				(1,070	)			100.2				—
Other Regions			160,224				3,700				143,206				3,841				111.9				96.3
Total			612,037				(15,090	)			585,819				12,702				104.5				—
Corporate and Eliminations			(262,139	)			(1,298	)			(240,772	)			696				—				—
Consolidated		¥	349,898			¥	(16,388	)		¥	345,047			¥	13,398				101.4	%			—	%

Pioneer Corporation and Subsidiaries

Notes:

1.

The Company’s consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America.

2.

The consolidated financial statements include the accounts of the parent company and 126 subsidiaries and the investments in 5 affiliated companies accounted for on an equity basis.

3.

Effective from fiscal 2005 year-end presentation, operating income (loss) is presented as net sales less cost of sales, selling, general and administrative expenses in order to be consistent with generally accepted financial reporting practice in Japan. The Company believes that such presentation is useful for comparison of the Company’s financial results with those of other Japanese companies. Under the U.S. GAAP, business restructuring expenses and losses on impairment of long-lived assets as well as gains and losses on sale and disposal of fixed assets included in “Other—net” are included in operating income (loss). Previously reported amounts in consolidated statements of operations and segment information have been reclassified accordingly.

4.

Effective from this fiscal 2006, the Company changed business segment classification for certain businesses. Results related to plasma displays for business use and DJ equipment have been moved from “Others” to “Home Electronics.” Corresponding figures for the previously reported operating revenue by segment and segment information have been reclassified accordingly.

Pioneer Corporation—Parent Company Only

II.		NON-CONSOLIDATED FINANCIAL STATEMENTS
		FOR THE SIX MONTHS ENDED SEPTEMBER 30, 2005

(1) SALES BY SEGMENT

(In millions of yen)

		Six months ended September 30
		2005								2004								% to
		Amount				% to total				Amount				% to total				prior year
Domestic		¥	31,923				13.0	%		¥	32,120				13.7	%			99.4	%
Export			84,303				34.3				77,616				33.2				108.6
Home Electronics			116,226				47.3				109,737				46.9				105.9
Domestic			55,997				22.8				61,362				26.3				91.2
Export			73,053				29.7				62,086				26.5				117.7
Car Electronics			129,051				52.5				124,173				52.8				103.9
Domestic			494				0.2				788				0.3				62.8
Export			47				0.0				64				0.0				72.9
Others			541				0.2				852				0.3				63.5
Domestic			88,416				36.0				94,995				40.3				93.1
Export			157,403				64.0				139,767				59.7				112.6
Total		¥	245,819				100.0	%		¥	234,039				100.0	%			104.7	%

Note:		Effective from this fiscal 2006, the Company changed business segment classification for certain businesses. Results related to plasma displays for business use and DJ equipment have been moved from “Others” to “Home Electronics.” Previously reported amounts have been reclassified accordingly.

(2) CONDENSED STATEMENTS OF OPERATIONS

(In millions of yen)

		Six months ended September 30
		2005								2004
						% to								% to
		Amount				net sales				Amount				net sales
Net sales		¥	245,819				100.0	%		¥	234,039				100.0	%
Cost of sales			213,720				86.9				191,874				82.0
Selling, general and administrative expenses			41,592				17.0				41,981				17.9
Operating income (loss)			(9,493	)			(3.9	)			183				0.1
Non-operating income—net			54				0.1				2,098				0.9
Ordinary income (loss)			(9,439	)			(3.8	)			2,282				1.0
Other income (expenses)—net			357				0.1				(0	)			(0.0	)
Income (loss) before income taxes			(9,081	)			(3.7	)			2,281				1.0
Income taxes			(3,709	)			(1.5	)			141				0.1
Net income (loss)		¥	(5,371	)			(2.2	)%		¥	2,140				0.9	%

Pioneer Corporation—Parent Company Only

(3) CONDENSED BALANCE SHEETS

(In millions of yen)

		September 30								March 31
		2005				2004				2005
ASSETS
Current assets:
Cash		¥	46,162			¥	33,829			¥	40,502
Notes and accounts receivable—trade			46,605				38,018				51,833
Marketable securities			–				18,683				11,685
Inventories			29,044				34,733				28,018
Other current assets			31,020				64,070				41,683
Total current assets			152,832				189,336				173,724
Fixed assets:
Tangible			52,674				48,282				53,301
Intangible			28,523				21,335				29,826
Investments and others			208,751				204,768				201,893
Total fixed assets			289,949				274,386				285,021
Total assets		¥	442,782			¥	463,722			¥	458,745
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Notes and accounts payable—trade		¥	53,827			¥	50,129			¥	52,738
Accrued expenses			37,471				34,730				40,152
Other current liabilities			15,350				26,766				23,611
Total current liabilities			106,649				111,627				116,502
Long-term liabilities			73,279				76,100				73,237
Total liabilities			179,929				187,727				189,740
Shareholders’ equity			262,852				275,995				269,005
Total liabilities and shareholders’ equity		¥	442,782			¥	463,722			¥	458,745