Omron 2015 Annual Report Download - page 24

Emerging economies expand investment in automation
Market Growth
Drivers
60%
Control Equipment
(Programmable Logic
Controllers, etc.)
Revenues in Japan were up year on year, reflecting
an uptick in the economy, as well as heavy capital
spending in the automobile and electronic compo-
nents sectors.
Overseas, a weaker yen resulted in solid earnings
performance in all regions. In the Americas, demand
in the U.S. automobile industry and growth in the oil
and gas business contributed to higher revenues.
A gradual economic recovery in Europe helped push
growth in that region. We saw major growth in sales
to the electronic component industries in Asia, despite
currency weaknesses in certain Asian nations. Great-
er China was another source of significant growth,
particularly in the electronic components market.
Operating income kept pace with net sales in-
creases for the year. A weak yen, combined with
sales of higher value-added products to emerging
economies, contributed to higher overall revenue
and profit gains compared to the prior fiscal year.
Fiscal 2014 in Review
Worldwide revenue and profit gains drive Omron earnings
■ Sales by Product (Fiscal 2014)
Manufacture and sales of factory automation equipment
Fiber Sensors
Safety Light
Curtains
Temperature Controllers
Programmable Controllers
30%
Sensing Equipment
(Sensors, Switches, etc.)
10%
Safety Equipment
(Safety Light Curtains, etc.)
* Machinery orders index calculated by Omron based on
Cabinet Office (Japan) reports.
IAB domestic sales generally correspond to trends in the
machinery orders index.
■ Machinery Orders Index*
100
80
60
40
20
0
150
120
90
60
30
0
(Billions of yen)
Machinery orders index (left axis)
IAB domestic sales (right axis)
11
(FY) 12 13 14
■ Earnings and Projections
* See notes on P. 43.
(Billions of yen)
FY2011*FY2012*FY2013 FY2014 FY2015
(Forecast)*
Net sales 270.8 263.0 291.7331.8345.0
Japan 123.1 116.3 119.4126.7137.0
Overseas 147.7 146.7 172.3205.1208.0
Americas 29.3 31.6 36.947.644.0
Europe 55.3 50.4 61.967.866.0
Asia Pacific 25.3 24.7 28.934.137.5
Greater China 36.8 39.4 43.855.060.0
Direct Exports 1.0 0.6 0.80.70.5
Operating income 35.4 31.3 38.854.657.0
Operating income margin 13.1%11.9%13.3%16.5%16.5%
R&D expenses 15.4 16.5 15.715.3
Depreciation and amortization 4.2 3.5 3.63.5
Capital expenditures 3.8 2.8 3.34.2
Fiscal 2015 Forecast and Strategies
Push toward record earnings
We have set a target of ¥345 billion for fiscal 2015
net sales (4% year-on-year gain), with operating
income scheduled to reach ¥57 billion (4.4% in-
crease). These figures will represent another record
high for our revenues and profits. In Japan, we
expect to see strength in the automobiles, electron-
ic components, and semiconductor sectors. Over-
seas, we project slowing growth in China and lower
demand in the oil and gas business due to low
crude prices. On the other hand, we forecast high-
er capital spending for automobiles and electronic
components, as well as more investment in
manufacturing automation among emerging countries.
The advanced nations of the world aren’t the only
ones struggling with labor problems. Lately, even
emerging economies are dealing with worker shortag-
es and rising demands for safer, higher-quality manu-
facturing. The market is changing, and we believe that
automation is going to be the long-term answer.
The Industrial Automation Business leverages our
expansive product line and global business infra-
structure and services network to deliver valuable
products and services to our customers around the
world. We grow by helping our customers grow.
Extensive product lineup; global business infrastructure and services networkStrengths
Source: Nippon Electric Control
Equipment Industries
Association
Market Share
(FY2014)
Control-Related Equipment (Japan)
Approx. 40%
Ratio of Total Sales
(FY2014)
39%
Segment Information
Industrial Automation
Business (IAB)
From manual inspection to automated
inspection using vision sensors
The automobile, electronic components, and food industries are relying more and more on vision sensors to
perform automated inspection work. Emerging economies have traditionally relied on manual inspections in
their manufacturing processes. But labor shortages and demands for higher quality mean that even these
nations are looking to use vision sensors in more cases. Drawbacks in the manual inspection process include
worker exhaustion, human error, and difficulty in detecting minor variances. On the other hand, vision sensors
can conduct highly precise inspections non-
stop, 24 hours a day. Vision sensors can easily
track high-speed manufacturing lines, which
would be impossible for the human eye to
follow. By providing advanced products, we
will contribute to the future development of
production lines.
We Solve Societal Issues
How to deal with global labor shortages 5% to 10%
Projected annual growth rate in the vision
sensor market (IMS Research, Other)
About Omron Where We’re Headed Corporate Value Initiatives Corporate Value Foundation Financial Section
44 OMRON Corporation Integrated Report 2015 45