Olympus 2005 Annual Report Download - page 7

O LYMPUS 20 05 5
A MESSAGE
FRO M THE PRESIDEN T
In fiscal 2005, ended M arch 31, 2005, Olympus
recorded a net loss, its first since the introduction of
consolidated financial accounting. From the start of
the in-house company structure in 2001 until the split-
off of the Imaging Systems Business and the M edical
Systems Business in 2004, Olympus has followed a
smooth growth curve while implementing various
reforms. As a result, I believe O lympus has gained
market recognition as a winning company. For this
reason, I deeply regret having to report to our share-
holders and other stakeholders that O lympus posted a
net loss in fiscal 2005. In this annual report, we will
discuss the digital camera business and the issues
relating to its decline in profits, and how we plan to
rebuild our earnings foundation.
> O verview of Fiscal
2005
Thousands of
Millions of yen U.S. dollars
2005 2004 200 3 2005
Net sales .......................................................................... ¥813,538 ¥633,622 ¥564,343 $ 7 ,3 9 5 ,800
Net income (loss)................................................................ (11,827) 33,564 24,348 (107,518)
Earnings per share—Basic net income (loss) ............................ (44.98) 126.96 91.88 (0.409)
Total assets ....................................................................... 858,083 682,673 605,768 7,800,755
Shareholders’ equity ........................................................... 240,837 252,179 222,432 2,189,428
N otes: 1. Earnings per share is shown in yen and U.S. dollars.
2. The U.S. dollar amounts have been translated from yen, for the convenience of the reader, at the rate of ¥ 110=US$ 1.0 0
3. The above figures are based on accounting principles generally accepted in Japan.
4. Diluted net income per share is not presented due to the fact that there were no potentially dilutive common shares.
During fiscal 2005, consolidated net sales totaled ¥ 813.5 billion,
an increase of 28.4% compared with the previous fiscal year.
However, ¥170.4 billion of these sales are attributable to consoli-
dated sales at ITX Corporation, which became a consolidated sub-
sidiary in the second half of the fiscal year under review. Excluding
this factor, consolidated net sales would have increased 1.5%,
marking our 11th co nsecutive fiscal year of growth in net sales.
Nevertheless, O lympus recorded a net loss o f ¥11.8 billion in fis-
cal 2005, compared with net income of ¥33.6 billion in the previ-
ous fiscal year, owing to extraordinary losses on restructuring in
the Imaging Systems Business and the partial reversal of deferred
tax assets. Despite these consolidated results, O lympus has decid-
ed to maintain annual cash dividends o f ¥15 per share, the same
as in the previous fiscal year, in consideration of various factors
such as the future operating environment.
Poor performance in the digital camera business was the lone
cause of earnings deterioratio n in fiscal 2005. In four of our busi-
nesses, with the exception o f the Imaging Systems Business, we
achieved growth in both sales and profits in the Medical Systems
Business, Life Science Business, and Industrial Systems Business.
Despite concerns to the contrary, the Industrial Systems Business
was profitable and contributed to overall earnings. In the Medical