Konica Minolta 1999 Annual Report Download - page 16

PHOTOGRAPHIC MATERIALS AND PHOTO-RELATED
INDUSTRIAL EQUIPMENT
Overall sales in this segment declined 4.9% in fiscal 1999, to
¥336.6 billion.
Photographic Film, Paper, and Photofinishing Equipment
In fiscal 1999, Konica moved ahead with sweeping plans to
strengthen its domestic marketing structure for consumer photo-
graphic materials. The Company revamped its nationwide net-
work of photofinishing laboratories, establishing a new subsidiary,
Konica Color Imaging Corporation, to meet the growing demand
for digital processing services and expand the range of services
offered in this field. Operations at Konica Color Photo Equipment
Co., Ltd., a minilab maintenance service company, and Konica
Marketing Corporation, a sales and marketing subsidiary estab-
lished in April 1997, progressed smoothly during the year, enhanc-
ing the Company’s ability to raise customer satisfaction.
RIn January 1999, Konica began marketing its highly acclaimed
Konica CENTURIA series of color film throughout the world in
a new unified packaging design. This move is intended to rein-
force the market image of one of Konica’s mainstay color films.
Domestic sales volumes of color film rose slightly during the
year under review; however, depressed consumer spending
led to a decline in shipments of single-use cameras. In addition,
lower film processing prices prompted a decline in color paper
sales and, consequently, total domestic sales of film and color
paper fell below the previous fiscal year’s level. There were,
however, some bright performances, such as color paper for
New Year’s greeting cards, which posted surging sales during
the fiscal year.
RSales of single-use cameras grew steadily in North America
and Europe. In contrast, the economic downturn in Asia resulted
in a drop in sales in the region, dragging total overseas sales of
film and color paper below the level recorded in fiscal 1998.
RThe growing number of minilabs and the advance of digital
processing technologies are having a profound effect on the
photofinishing industry. In October 1998, Konica took a signifi-
cant step toward establishing a lead over competitors in the
field of digital processing with the introduction of the Konica
Digital Minilab QD-21 System. This strategic product is the
fastest in the photofinishing field and is able to produce digital
prints in diverse formats. Under its new organizational struc-
tures in Japan and overseas, Konica aims to reinforce and
expand its position in the photofinishing market.
Medical Imaging Products
The market for medical imaging products was adversely affected
by the third consecutive year of downward revisions to national
health insurance drug reimbursement prices. Nevertheless,
Konica recorded sales gains in this product category, thanks
to the strong performance of its Konica Dry Laser imagers.
Higher unit sales were accompanied by a sharp increase in
sales of laser imaging film.
RLooking ahead, Konica is striving to meet next-generation
diagnostic needs in such ways as expanding its lineup of
REGIUS digital imaging equipment.
Graphic Imaging and Industrial Equipment
The combination of weak demand in the publishing industry
and inventory adjustments by equipment makers resulted in
sales of pre-press equipment declining during the year under
review. Konica reorganized its operations in this area by trans-
ferring its domestic pre-sensitized plate business to Mitsubishi
Chemical Corp. in April 1999.
RKonica will focus its business in the pre-press equipment
market around its Konsensus color-proofing systems, which
have an outstanding reputation for dependable, efficient color
proofing. In fiscal 1999, Konica announced the development of
the Digital Konsensus, a product that the Company hopes will
quickly boost its presence in the digital color-proofing market.
Review of Operations
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