Kenwood 2003 Annual Report Download - page 11

FY1998
-30
-25
-20
20
-15
15
-10
10
-5
5
0
FY1999 FY2000 FY2001 FY2002 FY2003 FY2004 FY2006
*Figures for the fiscal years ending March 2004 and 2006 indicate targets of
'Excellent Kenwood Plan'.
(Billions of yen)
Net income achieves a "V-shaped" recovery
'Excellent Kenwood Plan'
Fiscal year ending March
2004 to fiscal year ending
March 2006
Operating income margin:
10%; ROE: 20%
Toward becoming a
company of global excellence
in our core business domains
that resumes dividend
payments and achieves a
zero net-debt management
1. Desired applications
The Company is dedicated to providing application technologies
and products that are easy to use, useful and enjoyable.
2. Advanced multimedia; synergy effects
We will pursue technologies and products that generate synergies
through the combination of core techniques in the three
businesses: car electronics, home electronics, and wireless radio.
At the same time, we will develop strategic digitization, networking
and visual technologies as well as differentiate our multimedia
audio and imaging techniques from those of our peers.
3. Pure sound and visual
We will develop sound and picture quality, which would create
exciting through Surprising Ideas, following the principle of "pure
quality".
Strategy for brand enhancement
• Strengthen Kenwood as a global brand
We will promote the brand name worldwide under a unified
concept, while tailoring the campaign to each region.
• Strengthen planning and developing capability, as well as overall
competitiveness to propose products suitable for the brand name.
Consolidated net income
The Company makes it a rule to comprehensively decide on the
allocation of profits by taking into account profitability and
financial conditions. It completed a debt-for-equity swap in
December 2002 and posted a net income in the fiscal year ended
March 2003, which resulted in eliminating negative net worth —
the largest problem that had been preventing the financial
standing from improving. Against this backdrop, we aim to
resume dividends as soon as possible, improve earnings and
cash flows by achieving targets set in the mid-term business plan,
recover our financial strength, and increase internal reserves.
On June 27, 2002, Kenwood's Board of Directors introduced a
new management structure centering on the executive officer
system. To facilitate this, the Company invited community and
business leaders of varying backgrounds to serve as outside
board members and participate in the business decision-making
process in open board meetings. On the other hand, the Board
designated executive officers who are tasked to focus on the
management of respective business units. As part of this new
framework designed to enhance decision-making and
management functions, we will make the management process
more transparent.
In March 2003, the Company established the Internal Auditing
Division, which is responsible for inspecting the Group's
management from the viewpoint of corporate governance and
compliance reports to the Board of Directors, in a bid to improve
overall corporate governance.
Fundamental strategy for allocation of
profits
Fundamental notion concerning corporate
governance and status quo of
implementation of related measures
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KENWOOD Corporation Annual Report 2003