Olympus 2004 Annual Report Download - page 9

O LYMPUS 2 0 0 4 7
The digital camera business co ntinues to take g reat strides
forward. Amid stro ng expansion o f the g lo bal market, sales
volume of digital cameras increased 6 8 % to 7 .4 million units,
maintaining a sharp g ro wth trend. Meanwhile, prices declined
due to fiercer competition. Acco rdingly, gro wth in sales value
was inco nsistent with the increase in sales volume, leading to
a decline in operating inco me.
The Medical Systems Gro up recorded robust growth in
sales and pro fits during the fiscal year under review, cen-
tered o n the endosco pe business in which we have a 70% or
higher share o f the wo rld market. Created through restructur-
ing of the Medical Systems Gro up, the Life Science Gro up go t
o ff to a g reat start.
As a result, by business segment, operating inco me
decreased 1 6 .7 % to ¥1 5 ,1 5 8 million (US$ 1 3 8 million) in the
Imaging Systems Gro up, increased 1 5 .7 % to ¥63,21 6 mil-
lio n (US$ 5 7 5 millio n) in the Medical Systems Gro up, and
ro se 1 6 .1 % to ¥3,823 million (US$ 3 5 million) in the Life
Science Gro up. The Industrial Systems Gro up posted an oper-
ating lo ss of ¥2 ,8 2 4 millio n (US$ 2 6 millio n), compared with
¥8 9 4 million in the previous fiscal year.
Providing Solutions
in the Digital Camera Business
>Altho ugh we achieved record-high sales in the digital camera
business, o ur outlo o k is not o ptimistic. Fast-gro wing business-
es carry their o wn unique risks. Market expansio n is expect-
ed to accelerate co mpetitio n in terms o f features and prices,
making it difficult to maintain growth in the future.
O ur solutions business opens up the po ssibility for sus-
tained g ro wth. O ne charm o f the digital camera business is
the ability to expand into business fields peripheral to digital
cameras, such as printers and software—new areas that did
not exist with conventional film cameras. Mo reover, many o f
these businesses peripheral to digital cameras o ffer high pro f-
it marg ins. W e are striving to increase the ratio of solutio ns
to 5 0 % to create a business model able to co nstantly g ener-
ate strong profits.
Fo r the solutions business to succeed, O lympus must make
its brand name synonymo us with digital cameras, and estab-
lish the O lympus brand as the most trusted for digital cam-
eras. W e aim to raise o ur third-ranked glo bal market share o f
1 5 % to 17% in the fiscal year ending March 3 1 , 2 0 0 5 and
eventually increase it to 2 0 %. The main push behind o ur
pro duct strateg y to increase market share is o ur affordably
priced single lens reflex (SLR) digital camera. Leveraging the
techno lo g ies we have honed as a camera manufacturer, we
aim to stimulate latent demand in customers that have not
been satisfied with the quality o f digital cameras until no w,
and achieve sales o f ¥20 billion in fiscal 2 0 0 5 .
M edical Systems G roup,
N ow and in the Future
>W ith its co re business in endo sco pes, O lympus expects the
Medical Systems G ro up to sustain stable growth in the future.
Alo ng with an ag ing so ciety in Japan, the medical industry is
under pressure to reduce medical expenses. Endo sco pes are
expected to play a majo r ro le in reducing medical expenses
with their excellent cost performance and po tential fo r
improving patients’ quality o f life.
O lympus bo asts an overwhelmingly superior po sition in
gastro intestinal endo sco pes, and peripheral businesses have
substantial room for further gro wth. The markets fo r surgical
pro ducts and endo -therapy devices rival that o f gastro in-
tesinal endosco pes in terms o f scale. O lympus’ glo bal market
share is still relatively lo w in these fields. W e have not applied
o ur advantages in gastro intestinal endosco pes to the fullest
extent po ssible. O lympus aims for a top market share in each
o f these fields. Ho wever high a hurdle, we must achieve these
goals. To this end, O lympus is wo rking to increase market
share fro m develo pment and marketing standpo ints by making
disposable devices, a key to market share in endo-therapy
devices.
In our mainstay gastrointestinal endo sco pes, the develop-
ment of so lutions is a key theme fo r future g ro wth, as with dig-
ital cameras. Co st per pro cedure (CPP) systems are a
business model where charges are applied acco rding to
endo sco pe usage instead o f equipment sales as in the past.
This system requires mino r initial investment o n behalf of med-
ical institutions, and running co sts after introduction are also
minimized. O lympus benefits by pro viding so lutio ns and
packaged deals that include maintenance and the supply of
オリンパス AR04 04.8.4 14:04 ページ 7