Hitachi 2012 Annual Report Download

Download and view the complete annual report

Please find the complete 2012 Hitachi annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 58

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58

Year ended March 31, 2012
Annual Report 2012
DYNAMIC
TRANSFORMATION FOR
GLOBAL GROWTH

Table of contents

  • Page 1
    Annual Repor t 2012 Year ended March 31, 2012 D Y N A M I C T R A N S F O R M A T I O N G L O B A L G R O W T H F O R

  • Page 2
    ... & Equipment 22 Construction Machinery 24 High Functional Materials & Components 26 Automotive Systems 28 Components & Devices 30 Digital Media & Consumer Products 32 Financial Services 32 Others Research and Development Intellectual Property CSR Management Corporate Governance Board of Directors...

  • Page 3
    ... Social Innovation Business, which supplies advanced social infrastructure linked by information technology (IT), thereby achieving a Dynamic Transformation for Global Growth, while contributing solutions to urgent global issues concerning social infrastructure. Hitachi, Ltd. Annual Report 2012 1

  • Page 4
    .... In 2011, a series of major events had a significant impact not only on the global and Management Structure Japanese economies but also on the management of the Hitachi Group. These events included the Great East Japan Earthquake, ï¬,oods in Thailand, economic turmoil in Europe stemming from the...

  • Page 5
    ...Management Structure Financial Services segments, but operating losses were recorded in Power Systems and Digital Media & Consumer Products. As a result, operating income decreased 7% to ¥412.2 billion. Due to a net gain on sale of marketable securities from the transfer of Hitachi's HDD business...

  • Page 6
    ... with the Founder Group in China > Started construction of a data center through a joint venture with a local company as a part of an effort to reinforce the outsourcing services business in Dalian, China > Received orders for thermal power generation equipment in South Korea as...

  • Page 7
    ... toward meeting the goals of the Fiscal 2012 Mid-term Management Plan and strategies designed to promote further growth. Thanks to the steady implementation of our Fiscal 2012 Mid-term Management Plan with its emphasis on the factors of Global, Environment and Fusion, Hitachi is steadily building...

  • Page 8
    ... the Hitachi Smart Transformation Project, in the area of indirect costs, we are implementing a cross-sectional review of back-office functions, which had been carried out indepen- Management Structure Financial Section/ Corporate Data dently by individual business units. We are also promoting...

  • Page 9
    ...Production costs b Globalization of the total value chain b Optimize and consolidate common manufacturing processes Research and Development/ Intellectual Property Management Structure overseas procurement activities Group-wide so as to make the most of the high yen, and will increase the number...

  • Page 10
    ... Section/ Corporate Data valuable opinions of our new Board Members into the Company's management practices, we aim to accelerate Hitachi's growth in the global market. In addition, we are promoting new initiatives to nurture and make the most of our human capital, which are the driving force for...

  • Page 11
    ... global market. As Hitachi completes the execution of the Fiscal 2012 Mid-Term Management Plan, our new leaders, new Board of Directors and our employees Segment Information Research and Development/ Intellectual Property Financial Highlights around the world are working together under the slogan...

  • Page 12
    ... 2010 To Our Shareholders Millions of yen 2012 2011 2010 For the year: Revenues ...Operating income ...Net income (loss) attributable to Hitachi, Ltd...Cash dividends declared ...Capital investment (Property, plant and equipment) ...Depreciation (Property, plant and equipment) ... ¥9,665,883 412...

  • Page 13
    ... Structure Notes: 1. In order to be consistent with financial reporting principles and practices generally accepted in Japan, operating income is presented as total revenues less costs of sales and selling, general and administrative expenses. The Company believes that this is useful to investors...

  • Page 14
    ... Magnetic Materials and Components • High Grade Casting Components and Materials 12 Hitachi, Ltd. Annual Report 2012 • Engine Management Systems • Electric Powertrain Systems • Drive Control Systems • Car Information Systems • HDDs • LCDs • Information Storage Media • Batteries...

  • Page 15
    ... Management Structure Hitachi Capital's Multifunctional IC Card Hitachi Appliances' Front-loading Washer Dryer Hitachi Transport System's Keihin Distribution Center • Optical Disk Drives • Flat-Panel Television Sets • LCD Projectors • Room Air Conditioners • Refrigerators • Washing...

  • Page 16
    ... to establish data centers in Dalian, China and Okayama Prefecture, Japan. Construction on each center commenced in October 2011 and December 2011, respectively. b Hitachi Electronics Services Co., Ltd. and Hitachi Information Systems, Ltd. were integrated and the new company Hitachi Systems, Ltd...

  • Page 17
    ...in sales and successful efforts to curtail costs. Segment Information Research and Development/ Intellectual Property Management Structure Data Center (Yokohama No. 3 Center) The Yokohama No. 3 Center is an environment-conscious data center that employs energy-efficient IT equipment. Temperatures...

  • Page 18
    ..., Japan AE Power Systems Corporation. Under the agreement, Hitachi also consented to taking over a part of the power transmission and distribution business run by AE Power. Looking ahead, the Company will expand the power distribution business, which is projected to experience growth. Earthquake...

  • Page 19
    ... orders. Hitachi is actively developing wind power generation systems that combine control systems with storage battery technologies in an effort to contribute to the creation of a low-carbon society. *2 As of June 2012 Financial Section/ Corporate Data Hitachi, Ltd. Annual Report 2012 17

  • Page 20
    ...and service of oil and gas plants. b In order to address growing demand for elevators and escalators in western China, Hitachi commenced construction of a new production base in Chengdu, China in March 2012. and construction activities in Japan as a recovery of the Great East Japan Earthquake began...

  • Page 21
    ... the reduction of no-load loss. In this manner, the Super Amorphous X SH Series not only contributes to lower running costs, but also through energy conservation helped curtail the amount of CO2 emissions. Management Structure Financial Section/ Corporate Data Hitachi, Ltd. Annual Report 2012 19

  • Page 22
    ...in Indonesia. b Hitachi Medical Corporation decided to construct a new factory in Suzhou, China in May 2011 in order to boost production of medical diagnostic equipment for emerging countries. b Hitachi Kokusai Electric Inc. converted Linear Equipamentos Eletrônicos S/A, a Brazil-based manufacturer...

  • Page 23
    ... world-class technologies to address calls for increasingly precise semiconductors. Hitachi Koki's Power Tools Mounted New Type of High Capacity Lithium-ion Battery Hitachi Koki's lithium-ion batteries-operated power tools also come with highly efficient, energy-saving brushless motors that offer...

  • Page 24
    ...Ltd. reached an agreement with U.S.-based Deere & Company to establish a jointventure company in Sao Paolo for the manufacture and sale of hydraulic excavators in October 2011 to address the growing demand for construction machinery in Brazil. b In March 2012, Hitachi Construction Machinery Co., Ltd...

  • Page 25
    ...purchase services to meet its customers' frontline mining needs. Management Structure Hitachi Construction Machinery's Double-Front Work Machine Under contract from New Energy and Industrial Technology Development Organization (NEDO), Hitachi Construction Machinery developed "ASTACO NEO," a double...

  • Page 26
    ... production line for casting components in South Korea as a part of efforts to bolster its global production structure in September 2011. b Hitachi Cable, Ltd. implemented business structure reforms in order to improve its earnings. In addition, the company commenced production of industrial wires...

  • Page 27
    ...result of the earthquake disaster and the flooding in Thailand, the downturn in sales, strong yen and impact of sharp increases in material prices on procurement costs placed negative pressure on profits. Research and Development/ Intellectual Property Hitachi Cable's Wires and Cables for Rolling...

  • Page 28
    ... the efficiency of high-output motors and lithiumion batteries that utilize the Hitachi Group's wide range of technologies including electric control, automotive-related batteries, material and component parts technologies. The Hitachi Group provides a broad spectrum of hybrid systems that cater to...

  • Page 29
    ... with a natural pedal feel. Research and Development/ Intellectual Property Management Structure Clarion's Car Navigation Clarion's NX712 car navigation system is compatible with Smart Access, a new cloud computing information network service. Utilizing an iPhone®*, drivers are now able to access...

  • Page 30
    ...' 2.5-inch Hard D Disk Drive Hitachi Global Storage Technologies provides highly re reliable HDD products that harness the company's technological capabilities ac across a broad spectrum of applications including notebook PCs, desktop PC PCs and servers. 28 Hitachi, Ltd. Annual Report 2012

  • Page 31
    ... of units shipped mainly of HDDs for notebook PCs due to shortage of component parts after the Great East Japan Earthquake and ï¬,ooding in Thailand. Accounting for the drop in sales, profits declined year over year. Note: The balance date of Hitachi Global Storage Technologies, Inc. is December 31...

  • Page 32
    ... due to the drop in sales of ï¬,at-panel TVs and optical disk driverelated products. Management Structure Research and Development/ Intellectual Property Hitachi Appliances' Front-loading Washer Dryer To remove dirt, the front-loading washer dryers lift clothing and drop it from a considerable...

  • Page 33
    ... in such home appliances as washing machines and vacuum cleaners in Japan, air-conditioning equipment sales were strong on the back of a recovery in capital expenditures and reconstruction demand following the Great East Japan Earthquake. Overseas, air conditioners and washing machines also recorded...

  • Page 34
    ... healthy overseas sales trends, this decrease was largely attributable to a drop in revenues from the financial services business for corporations in Japan. Fiscal 2011 Topics b Hitachi Capital Corporation converted Malaysia-based First Peninsula Credit Sdn. Bhd. and Indonesia-based PT Arthaasia...

  • Page 35
    ... of reduced credit costs particularly in the U.S. and Europe. Segment Information Hitachi Capital's Multifunctional IC Card Hitachi Capital provides IC card solutions that help rationalize such business activities as operating expense settlement operations including travel expenses. Research and...

  • Page 36
    ...-to-long-term technology development plans linked with business strategies. By proposing Group-wide strategic projects, the Technology Strategy Office formulates technology strategies to achieve Hitachi Group management policies. To Our Shareholders R&D capabilities to support the global growth...

  • Page 37
    ...Highly-reliable cloud computing Smart grids Energy (Coal thermal power technology, etc.) Green mobility (Inverter, Motor, etc.) Healthcare (Proton beam cancer therapy system, etc.) Management Structure Financial Section/ Corporate Data Strengthening International Standardization Activities Hitachi...

  • Page 38
    ... provided in the Hitachi Group Sustainability Report 2012. http://www.hitachi.com/csr/download/index.html Integrating CSR into Management Hitachi Group formulated a Group Vision to help resolve fundamental issues facing a global society and to realize a safe and comfortable society in line with the...

  • Page 39
    ... Action Plan for reducing greenhouse gas emissions, waste, chemical substance emissions and water use toward the realization of the Environmental Vision, and we are acting globally in order to reduce the environmental burden of business activities. As a certification system of plants and offices...

  • Page 40
    ...officers and directors in order to sustainably enhance corporate value and the shareholders' common interests. The basic management policy includes medium-term management plan and annual budget compilation. The Board of Directors focuses on strategic issues related to the basic management policy as...

  • Page 41
    ...-linked component Monthly salary Hiroaki Nakanishi Hitachi, Ltd. Executive Officer* 173 122 51 Research and Development/ Intellectual Property * Although concurrently serving as director, Mr. Hiroaki Nakanishi does not receive compensation as director. Risk Management and Internal...

  • Page 42
    ... concurrently as an executive officer. Chairman of the Board, Hitachi Construction Machinery Co., Ltd. Chairman of the Board, Hitachi Europe Ltd. President Chairman of the Board, Hitachi America, Ltd. Outside Directors Research and Development/ Intellectual Property Yoshie Ota Mitsuo Ohashi Nobuo...

  • Page 43
    ...systems business and information technology Management strategies, finance and corporate pension system High functional materials & components, quality assurance, production engineering, battery systems business and automotive systems business Hitachi group global business (Asia Pacific) Research...

  • Page 44
    ... Data Management Structure Number of employees ... Note: In order to be consistent with financial reporting principles and practices generally accepted in Japan, operating income is presented as total revenues less cost of sales and selling, general administrative expenses. The Company believes...

  • Page 45
    ... Financial Review Operating Results The Year Ended March 31, 2012 Compared with the Year Ended March 31, 2011 Summary Millions of yen Years ended March 31, 2012 2011 Percent change decreases in revenues in the Components & Devices, Digital Media & Consumer Products and Financial Services segments...

  • Page 46
    ... the Great East Japan Earthquake and ï¬,oods in Thailand, and decreased revenues in the Digital Media & Consumer Products and Financial Services segments. Segment Information Equity in net loss of affiliated companies decreased Â¥4.5 billion to Â¥15.5 billion in the year ended March 31, 2012, as...

  • Page 47
    ... in the Electronic Systems & Equipment segment, in particular higher sales at Hitachi High-Technologies Corporation, and increased revenues in the Construction Machinery segment reï¬,ecting higher demand in the leasing industry. Liquidity and Capital Resources Our management considers maintaining...

  • Page 48
    ... Section/ Corporate Data es, the proceeds from disposal of property, plant and equipment and the proceeds from disposal of tangible assets and software to be leased were subtracted from the amount of the capital expenditures, the purchase of intangible assets 46 Hitachi, Ltd. Annual Report 2012

  • Page 49
    ...from March 31, 2011, due primarily to an increase of working capital, partially offset by repayment of short-term debt with the consideration received for the sale of our HDDs business. As of March 31, 2012, long-term debt (excluding current portion), consisting mainly of debentures, debentures with...

  • Page 50
    ... 395,255 609,962 171,500 356,518 528,018 Management Structure Financial assets transferred to consolidated securitization entities ...Other assets ...Total assets ... 205,411 670,936 ¥9,418,526 304,160 728,007 ¥9,185,629 Financial Section/ Corporate Data 48 Hitachi, Ltd. Annual Report 2012

  • Page 51
    ...) 1,771,782 1,002,213 2,773,995 ¥9,418,526 409,129 603,133 922,036 (493,062) (1,371) 1,439,865 1,001,524 2,441,389 ¥9,185,629 Management Structure Financial Section/ Corporate Data Hitachi, Ltd. Annual Report 2012 49

  • Page 52
    ... ...Net income (loss) attributable to Hitachi, Ltd... Yen Net income (loss) attributable to Hitachi, Ltd. stockholders per share: Management Structure Basic ...Diluted ... ¥76.81 71.86 ¥52.89 49.38 ¥(29.20) (29.20) Financial Section/ Corporate Data 50 Hitachi, Ltd. Annual Report 2012

  • Page 53
    ......Sales of treasury stock ...Total change in capital ...Management Structure 168,426 154,294 ¥(432,057) ¥ (1,371) (126) 47 (79) ¥ (26,151) (183) 24,963 24,780 ¥ (1,371) ¥ (26,237) (115) 201 86 ¥ (26,151) Financial Section/ Corporate Data ¥ (1,450) Hitachi, Ltd. Annual Report 2012...

  • Page 54
    ...Hitachi, Ltd. stockholders ...Acquisition of treasury stock ...Sales of treasury stock ...Total change in total Hitachi...983,187 ¥2,441,389 ¥2,267,845 ¥2,179,352 Management Structure - (12,957) - Financial Section/ Corporate Data - - 37,292 (47,781) 412,808 ...Hitachi, Ltd. Annual Report 2012

  • Page 55
    ... adjustments ...Pension liability adjustments ...Net unrealized holding gain (loss) on available-for-sale securities ......Research and Development/ Intellectual Property Management Structure Financial Section/ Corporate Data 22,262 5,467 162 30,509 ¥ 53,079 Hitachi, Ltd. Annual Report 2012...

  • Page 56
    ... (115) 65 (261,113) 1,886 (11,517) (502,344) - 4,298 (230,342) 807,926 ¥577,584 Financial Section/ Corporate Data Management Structure Research and Development/ Intellectual Property Financial Highlights http://www.hitachi.com/IR-e/library/stock/index.html 54 Hitachi, Ltd. Annual Report 2012

  • Page 57
    ... Public Accounting Firm Ernst & Young ShinNihon LLC Investor Relations Contacts JAPAN Hitachi, Ltd. 6-6, Marunouchi 1-chome, Chiyoda-ku, Tokyo, 100-8280 TEL: +81-3-3258-1111 E-mail: [email protected] Management Structure U.S.A. Hitachi America, Ltd. 50 Prospect Avenue, Tarrytown, NY 10591...

  • Page 58
    Printed in Japan