Casio 2016 Annual Report Download - page 19

Annual Report 2016 / 4618
CONTENTS
To Our Stakeholders Prole Special Features ESG Information Financial Section Corporate Data
The management performance, financial position and share price of Casio Computer Co., Ltd.
and its consolidated subsidiaries (“the Casio Group” or “the Group”) are subject to the following
risks. Statements below concerning the future represent the judgment of the Casio Group as of
March 31, 2015.
(1) Japan’s economy and the global economy
The Group’s products are sold in Japan and in markets around the world, and demand is
therefore subject to the economic trends of each country. Trends in consumer spending
particularly affect the Group because we market the majority of our products to consumers.
(2) Price changes
Competition is intensifying in the Group’s industries because many companies are aggressively
trying to increase market share in Japan and overseas. A rapid decline in product prices could
negatively affect the Group’s results.
(3) New products
The Group could lose all or some of the advantage of being first or among the first to market if
the Group is unable to quickly and consistently launch popular new products, or if competitors
launch products that are similar to those of the Group, especially if such launches are
concurrent with those of the Group.
(4) Transactions with major customers
Any changes in strategy or product specifications made by major customers, and any
cancellation of orders or changes in their schedule could negatively affect the Group’s results.
(5) Outsourcing
The Group outsources a substantial portion of its manufacturing and assembly work to outside
service suppliers to improve the Group’s production efficiency and the operating income
margin, which could pose problems for consistent quality control. Moreover, problems among
outside suppliers including violations of laws, regulations, and intellectual property rights of
third parties could negatively affect the Group’s results and the reputation of its products.
(6) Technology development and change
Rapidly changing technologies and market needs in the Group’s businesses could
unexpectedly hasten product obsolescence and cause a sharp drop in sales.
(7) Risks associated with international expansion and overseas operations
The majority of the Group’s production and sales are outside Japan. Consequently, overseas
political and economic developments and revisions of laws and legislation may significantly
affect the Group’s financial position. In particular, regulatory changes and the enactment of new
laws are difficult to predict and could negatively affect the Group’s results.
Business Risks