Epson 2009 Annual Report Download - page 29

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28
The operating results by business segment are summarized below.
Information-related equipment
The printer business as a whole saw net sales sharply decline. Inkjet printer (including consumables, as in
all printer discussions in this section) net sales were constrained primarily by yen appreciation, a decline in
unit shipments, and an increase of units in the low-price zone as a percentage of total sales. SIDM printer
and terminal module sales were weighed down by the effects of a strong yen and a decline in demand as
the recession deepened. With the economy slumping, page printer unit shipments declined in the face of
fierce competition and a flagging market.
The visual instruments business also reported lower net sales. Although 3LCD projector unit shipments
increased, net sales were tempered by the effects of yen appreciation and price erosion.
Operating income in the information-related equipment segment declined. Income was hit primarily by the
appreciation of the yen in combination with erosion in prices for inkjet printers and 3LCD projectors and
declines in unit shipments of SIDM printers and POS system products.
As a result of the foregoing factors, net sales in the information-related equipment segment were ¥769,850
million, down 14.7% year over year, while operating income was ¥30,143 million, down 63.8% year over
year.
Electronic devices
The display business as a whole posted sharply lower net sales despite increased first-half demand for
a-TFTs from a steady mobile phone handset market. Net sales were weighed down by a decline in demand
for LTPS used in digital cameras. Sales of HTPS for 3LCD projectors were hurt by a sudden slowing of
projector market growth in the second half. Unit shipments of both MD-TFD LCDs ("TFD"), a business
Epson is scheduled to terminate, and color STN LCDs ("CSTN"), a business where production operations
are to be significantly downsized, declined.
The quartz device business saw net sales plummet due to the recession and steep production adjustments in
a host of applications, including mobile phone handsets, digital cameras and digital home electronics.
Semiconductor business net sales fell sharply. Several factors contributed to the decline, including a
cutback in unit shipments of LCD drivers to handset manufacturers as part of strategic changes to the
product mix, declines in unit shipments of other products as the economy went into recession, and the
effects of yen appreciation.
Electronic devices segment losses expanded. Although operating income benefited from the cost
reductions that accompanied structural changes in the display business and from increased unit shipments
of a-TFTs, profitability rapidly deteriorated due to significant declines in quartz device and semiconductor
business revenues.
As a result of these factors, net sales in the electronic device segment were ¥311,626 million, down 21.1%
year over year, while operating loss was ¥18,249 million versus operating loss of ¥17,167 million in the
year ago period.
Precision products
The precision products segment reported lower operating income as net sales dropped due to a decline in
watch and IC handler unit shipments.
As a result of the foregoing factors, net sales in the precision products segment were ¥72,697 million,
down 13.4% from the prior year. Operating loss was ¥1,907 million, compared to operating income of
¥2,733 million in the year ago period.
The operating results by geographic segment are summarized below.
Japan
Inkjet printer, TFD, page printer, CSTN, crystal device, terminal module, 3LCD projector and SIDM