Fujitsu 2008 Annual Report Download - page 85

ASIC*1 and COT*2 operations, we are strengthening our sales of
general-purpose devices, including ASSPs*3, microcontrollers,
and analog devices, for which demand is growing, especially in
Asia. The goal of the restructuring is to increase the proportion of
sales derived from high-value-added, general-purpose offerings
and build a stronger, more efficient business foundation.
*1 ASIC : Application-specific integrated circuit
*2. COT : Customer owned tooling (contract production of LSI devices
designed and developed by the customer)
*3 ASSP : Application-specific standard product
Net Sales and Operating Income by
Business Segment (including intersegment sales) (¥ Billions)
Years ended March 31
2007 2008
Increase
Rate (%)
Net sales
Technology Solutions .......... ¥3,157.0 ¥3,272.2 3.6%
Ubiquitous Product Solutions. . . 1,118.3 1,188.9 6.3
Device Solutions ............... 762.6 796.7 4.5
Other Operations .............. 490.3 526.8 7.4
Intersegment elimination ...... (428.2) (453.9)
Consolidated net sales ......... ¥5,100.1 ¥5,330.8 4.5%
(¥ Billions)
Years ended March 31
2007 2008
Increase
(Decrease)
Operating income (loss)
Technology Solutions .......... ¥163.6 ¥180.1 ¥16.5
Ubiquitous Product Solutions . . 41.6 52.5 10.9
Device Solutions ............... 19.0 18.2 (0.7)
Other Operations .............. 10.5 14.2 3.7
Unallocated operating
costs and expenses/
intersegment elimination .....
(52.7)
(60.3)
(7.5)
Consolidated operating income . . ¥182.0 ¥204.9 ¥22.9
Geographical Segment Information
The following section provides information on sales (including
intersegment sales) and operating income in each of our princi-
pal operating regions.
Japan
In Japan, the Fujitsu Group reported sales of ¥4,229.7 billion
(US$42,297 million), up 3.7% from fiscal 2006. Lower sales of
mobile phone base stations and other products were out-
weighed by higher sales of services, PCs, and mobile phones.
Operating income grew a substantial ¥49.0 billion, to ¥240.9
billion (US$2,409 million). Despite intensified price competition
in HDDs for notebook PCs and lower sales of mobile phone base
stations, operating income increased owing to higher sales and
increased efficiency in the services, server, and PC businesses
following cost-cutting measures.
EMEA
In EMEA, sales increased 4.6%, to ¥769.9 billion (US$7,699 million).
Growth was particularly strong in Germany and Scandinavia,
where our Services business expanded on the back of acquisi-
tions. Operating income declined ¥23.4 billion, to ¥0.7 billion
(US$7 million). Despite the beneficial effect of increased sales,
operating income was negatively affected by several factors.
These included a provision for losses from an unprofitable proj-
ect in the United Kingdom, higher goodwill amortization costs
associated with acquisitions in the Services business, and invest-
ments in the development of optical transmission systems and
other Next-Generation Network (NGN) equipment.
The Americas
Sales in the Americas rose 6.3%, to ¥469.9 billion (US$4,699 mil-
lion). Higher sales of optical transmission systems, servers, HDDs,
and notebook PCs contributed to the overall revenue increase.
Operating income remained mostly unchanged, at ¥9.2 billion
(US$92 million). Despite higher development costs for NGN and
increased marketing expenses related to the launch of IA serv-
ers, operating income was boosted by higher sales and cost-
cutting in the retail solutions business.
APAC & China
In APAC & China, sales grew 5.9%, to ¥855.0 billion (US$8,550 mil-
lion). Due in part to an acquisition in Oceania, the Services business
expanded, while our HDD manufacturing subsidiaries also posted
higher sales. Operating income climbed ¥3.1 billion, to ¥14.8 billion
(US$148 million), owing mainly to the revenue increase.
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MANAGEMENT’S DISCUSSION AND ANALYSIS OF OPERATIONS
ANNUAL REPORT 2008FUJITSU LIMITED