Epson 2007 Annual Report Download - page 9

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7
Annual Report 2007
We made steady progress, especially in cutting materials procurement costs and
reducing fixed costs throughout the Company. Also, thanks to a depreciating yen,
Epson was able to surpass its ordinary income target of ¥40 billion. Meanwhile,
because major challenges have emerged in our display business, we began
restructuring to initiate a business recovery from the fiscal year ending March 31,
2008.
The inkjet printer business is one that has become more profitable. In this
business, we conducted an in-depth review of product lineups in each region and
through the systematic reduction in the number of printer models, especially low
print volume models, we effected a shift in focus from quantity to quality. In
addition, our efforts to cut costs and create a stronger business foundation
have succeeded and profitability has improved.
Because of substantially below-target sales for mobile phone LCDs and a
lack of growth in non-handset applications, we suffered a major earnings
decline in our display business. This forced us to thoroughly examine the causes of
our poor performance, and as a result, we initiated radical reforms, which were
announced in March 2007. Consequently, we recorded business restructuring
expenses, including impairment losses associated with the structural reforms, and
weretherefore able to shift over to a financial structure compatible with our future
business strategy.
Q2. Taking all that into account, how do you rate last year?
The Creativity and Challenge 1000
Mid-Range Business Plan
Epson Mid-Range Business Policies
Reorganize the electronic device businesses
Streamline costs
Reform the governance system
Reform the corporate culture
Reform the
management
structure and drive
innovations in
management
Achieve a solid turnaround
beginning in the fiscal year
ended March 2007
Achieve ¥100.0 billion or more
in ordinary income in the
fiscal year ending March 2009
Redefine and reinforce the business and
product portfolios