Omron 2003 Annual Report Download - page 28

Service Company in March 2003 and reoriented its opera-
tions to an in-company focus. The Business Development
Group is responsible for exploring and nurturing new
businesses, as well as developing and strengthening
businesses that are not formally internal companies. New
businesses include a remote supervisory system for the
machine-to-machine field and a vehicle anti-theft system,
which are now on the market. The Business Development
Group will assess additional market opportunities in
these sectors.
Increase (Decrease) in Sales of Internal Business Companies
2003 2002 2001
Industrial Automation ............. 10.0% (17.9)% 11.2%
Electronic Components ........... 5.3 (1.0) 7.5
Social Systems Business ........ (8.9) (12.2) 10.4
Healthcare ................................ 4.2 3.3 (7.8)
Others ....................................... (29.5) (4.2) (6.0)
Note: The increase or decrease in sales for 2001 and 2002 is based on the amounts
previously reported for the respective years, prior to the reclassifications made
in the following year.
Review of Operations by Region
Japan
The disposal of nonperforming loans continued to
weigh on Japan’s economy. Concerns about the future
restrained personal consumption and capital expendi-
tures, which weakened domestic demand. IAB and ECB
achieved solid results during the past fiscal year. The envi-
ronment remained challenging for SSB and AMB, as diffi-
cult conditions in the financial markets held back capital
investment and public-sector investment was restrained.
Omron also transferred the operations of consolidated
subsidiary Omron Alphatech Corporation as part of its
ongoing structural reforms, which reduced net sales. As a
result, total sales to external customers for the fiscal year
decreased 4.8 percent year-on-year to ¥340,575 million.
North America
During the first half of the fiscal year, the economy of
the United States remained the driving force of the global
economy with support from firm housing investment and
consumer spending. In the second half, however, weak-
ness in the stock market and events in Iraq exerted an
unfavorable effect. In this environment, IAB, ECB and
HCB generated solid results. Total sales to external cus-
tomers increased 3.5 percent to ¥67,886 million.
Europe
The economies of Europe showed indications of moder-
ate recovery, along with growing concerns about future
prospects. IAB, ECB and HCB generated firm results, sup-
ported by the depreciation of the yen against the euro from
the previous fiscal year. As a result, total sales to external
customers increased 12.6 percent to ¥73,513 million.
Asia and Other
The economies of Asia, particular those of greater
China, continued to expand because of increased exports
and consumer spending. IAB, ECB and HCB generated
solid results in this environment. As a result, total sales to
external customers increased 17.4 percent year-on-year
to ¥53,099 million.
Assets, Liabilities and Shareholders’ Equity
As of March 31, 2003, total assets were ¥567,399 million,
an increase of ¥18,033 million, or 3.3 percent, from March
31, 2002. Current assets increased ¥17,615 million, or 6.3
percent, to ¥295,113 million. The return to profitability and
improved cash flow resulted in an increase of ¥9,140 mil-
lion, or 12.9 percent, in cash and cash equivalents, and
deferred income taxes also increased.
Net property, plant and equipment decreased ¥3,249
million, or 2.1 percent, to ¥149,045 million. Investment in
machinery and equipment offset the effect of the write
down of buildings to fair value as discussed above.
Investments and other assets increased ¥3,667 million,
or 3.1 percent, to ¥123,241 million. An increase in deferred
income taxes offset the decrease in the market value of
investment securities.
The total of current liabilities, long-term liabilities and
minority interests in subsidiaries increased ¥64,657 mil-
lion, or 25.7 percent, to ¥315,789 million. Current liabilities
increased ¥22,132 million, or 17.1 percent, to ¥151,577 mil-
lion, due primarily to an increase of ¥4,225 million in bank
loans to ¥18,948 million and an increase of ¥10,805 million
in the current portion of long-term debt to ¥11,997 million.
Working capital at the balance sheet date decreased
¥4,517 million, or 3.1 percent, to ¥143,536 million, and the
current ratio was 195 percent, compared to 214 percent a
year earlier. Long-term debt decreased by a net ¥2,481
1999
2000
2001
2002
2003
63.7
69.8
71.6
71.3
67.0
12.7
10.5
10.7
10.8
12.3
13.7
13.9
11.0
10.3
12.2
9.9
5.8
6.7
7.6
8.5
Sales by Region (%)
■ Japan
■North America
■Europe
■Asia and Other
26 • Omron Corporation