Pentax 2013 Annual Report Download

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ONLINE
HOYA Report 2013

Table of contents

  • Page 1
    ONLINE HOYA Report 2013

  • Page 2
    ... five distinctive aspects of Hoya as a company. Profitability comes first at Hoya. Notation in this annual report on the cebsite HOYA's fiscal year ends on March 31. In this website, references to years are to the period ended March 31 of the year indicated. Copyright 2013 © HOYA CORPORATION

  • Page 3
    Five points to know about Hoya We will keep changing our business portfolio. Copyright 2013 © HOYA CORPORATION

  • Page 4
    Five points to know about Hoya Fewer directors mean more speedy decision-making. Copyright 2013 © HOYA CORPORATION

  • Page 5
    Five points to know about Hoya We aim to be "a big fish in a small pond." Copyright 2013 © HOYA CORPORATION

  • Page 6
    Five points to know about Hoya Ninety percent of our workforce are non-Japanese. Copyright 2013 © HOYA CORPORATION

  • Page 7
    ... more corporate value, to use the precious funds extended to us by all shareholders. 1 2 3 4 5 Fiscal year ended March 2013 Result Review Business Portfolio Management As Hoya s Way Hoya s sources of strength My job as CEO Concluding message to shareholders Copyright 2013 © HOYA CORPORATION

  • Page 8
    ...by the PENTAX Imaging Systems Business, which was sold in October 2011, in the first half of the previous fiscal year, sales increased by 3.3% year on year. The Life Care segment recorded sales of ¥208,968 million, up 8.3% year on year, and grew to contribute 56% of group sales. The Eyeglass Lens...

  • Page 9
    .... As we focused on how Hoya can create value in the scene of capturing an image into picture elements (pixels), our strategies have become clearly visible. Regarding our business related to hard disk drive glass disks, we sold our operation for applying magnetic coating (Media business) and decided...

  • Page 10
    ..., we decided to make a speedy sale of that business to the most appropriate buyer. We sold the media business (HDD glass memory disk coating) to Western Digital Corporation in 2010 and the PENTAX digital camera business to Ricoh Company in 2011. In contrast, Hoya aims to achieve h i g h g row th...

  • Page 11
    ... aim of becoming "a big fish in a small pond." Each business has a strategy, is operated by passionate employees who are dedicated to execute the strategy, and is supported by a global system. In addition, each business is based on a management structure which has been designed to enable sustainable...

  • Page 12
    Special Features for 2013 1 Lifecare Business is a key for HOYAs sustainable growth Developed countries are facing issues derived from aging populations, expansion of medical service needs for the elderly, and growth and development of the healthcare service market, while tighter control of ...

  • Page 13
    ... profit ratio. M&A Activities in Life Care Segment Year Business Eyeglass lens Country Belgium Company/Division Buchmann Optical Industries, N.V. Business Activities Production and sales of eyeglass lenses Processing and sales of eyeglass lenses Development, production, and sales of endoscopes...

  • Page 14
    ..., enhance medical services, and improve the people's quality of life (QOL) in line with changes in their life style. Hoya's intraocular lenses for cataract treatment, eyeglass lenses, medical endoscopes, and other products have seen a rise in demand due to the aging of the global population...

  • Page 15
    ...term growth are the eyeglass lens business and the endoscope business. Business CAGR Hoya's market share Factors for profit growth Future development Continue to develop products that respond to needs at medical care site and promote global operation in production, sales, and services. Look for...

  • Page 16
    G r o w t h D r i v e r Medical Endoscope Business Potential 2 The medical endoscope business, one of HOYA's growth drivers, has the following characteristics and growth potential. Copyright 2013 © HOYA CORPORATION

  • Page 17
    ... of bases for R&D, sales and marketing, and customer service for its endoscope business. Overseas group companies in 14 countries and R&D bases in Japan, the U.S., and Germany are promoting development and use of products that match the needs of each local market. Copyright 2013 © HOYA CORPORATION

  • Page 18
    ... Features for 2013 Medical Endoscope Business Potential PENTAX EPK-I & 90i series is a high-end series of HOYA's medical endoscopes. It combines the videoscope 90i series, which mounted a Megapixel CCD for the first time in the world for endoscopes, with the video processor EPK-i which realizes...

  • Page 19
    ... focusing our internal R&D on innovative products that are DIFFERENTIATED from competitors by ease of use, clinical relevance, and quality. 2. Strong focus on a global quality system. 3. Grow in emerging markets through localization of resources and management teams. 4. Globalize company...

  • Page 20
    ... Here we explain the characteristics and growth potential of Hoya's eyeglass lens business. The global eyeglass lens wholesale market is expected to increase from $11.3 billion in 2012 to $15.0 billion by 2025, particularly supported by growth in progressive lenses(PAL). On the back of the aging of...

  • Page 21
    ... Global Network Hoya's eyeglass lens business covers 52 countries and has a direct sales system in 31 of those countries. The divisional headquarters is located in Bangkok, Thailand where business strategies are planned and conducted from a global perspective. Copyright 2013 © HOYA CORPORATION

  • Page 22
    ... in anti-reflection coatings in the industry. Hoya's strict quality control system is at the top international level and guarantees high quality in any market. Hoya's leading-edge plant in Thailand operates 24 hours a day, 365 days a year, helping to ensure speedy delivery to customers worldwide...

  • Page 23
    Special Features for 2013 Potential of the Eyeglass Lens Business, a growth driver Copyright 2013 © HOYA CORPORATION

  • Page 24
    ... sells Seiko brand eyeglass lenses. We will promote sales of the Seiko brand eyeglass lenses in Japan and overseas by put ting those products on Hoya s global manufacturing and sales network. In Europe, the U.S., Japan, Australia, and other developed countries, market demand for progressive lenses...

  • Page 25
    ... eyeglass lens development and manufacturing business of Seiko Epson Corporation was transferred to Hoya. Through these activities, we expanded our business in this fiscal year ended March 2013 and our sales in the fourth quarter exceeded the quarterly sales level prior to the ï¬,ooding in Thailand...

  • Page 26
    ... capital" that financially supports them, and "cost of shareholders' equity" which is the return the company pays to its owners, i.e., shareholders. SVA, which is derived from combining these elements, is a metric to reï¬,ect an increase of corporate value. SVA represents a company's worth after...

  • Page 27
    ... reflecting = Corporate value In the long corporate history of Hoya, we once generated net loss and was temporarily under control of a bank. That was back in 1967. Five years after, the bitter experience triggered us to adopt cash ï¬,ow management. Since then, we have upgraded our major management...

  • Page 28
    ...some ups and downs caused by economic ï¬,uctuation. We have set a hurdle rate for each business, based on its characteristics, which results in a portfolio of diverse businesses ranging from high-risk high-return businesses to middle-risk middle-return businesses. Copyright 2013 © HOYA CORPORATION

  • Page 29
    ...Photomasks for Semiconductor Photomasks Glass Memory Disks for Hard Disk for Liquid Drives Crystal Display Eyeglass Lenses Contact Lenses Optical Lenses and Optical Glass Medical Endoscopes 5-year sales and operating profit 5-year sales and operating profit Copyright 2013 © HOYA CORPORATION

  • Page 30
    ... patterns to wafers. Hoya manufactures photomasks, the original versions of patterns used in this process, and mask blanks, which are substrates for these photomasks. In the fiscal year under review, this business was adversely impacted by the slowdown in the semiconductor industry, but we displayed...

  • Page 31
    ...Plant in Japan, Hoya will promote R&D in cutting-edge fields and build an efficient production system that handles h i g h - p re c i s i o n p ro d u c ts to g e n e r a l - p u r p o s e products. Moreover, Hoya plans to expand business under an organization that can supply high-quality products...

  • Page 32
    ... with top global market share Since Hoya developed photomasks in 1985, it has continued to contribute to the market penetration of LCD panels as a leading company among photomask manufacturers. Hoya is naturally able to supply high-quality products rapidly and steadily, and by constantly promoting...

  • Page 33
    Business Overview Information Technology Photomasks for Liquid Crystal Displays 3 We rapidly reflect customer needs in product development with our global network. Hoya has now established an organization that can respond quickly and precisely to various customer needs, based on its network of ...

  • Page 34
    ... company and concentrate management resources on fabricating and polishing glass substrates. As a result, our business competitiveness increased further, and we now hold a dominant position in this market. 2 Production capacity and supply system that win the trust of customers The source of Hoya...

  • Page 35
    Business Overview Information Technology Glass Memory Disks for Hard Disk Drives 3 Further boosting market share through development of next-generation products The recording capacity of HDDs has grown rapidly in the past five years. Owing to the spread of digital cameras and smartphones, easily...

  • Page 36
    ... to lead the world for a long time. Hoya's optical glass business already boasts a history of more than 70 years. Hoya provides optical glass materials and various kinds of lenses and lens units made of optical glass or plastic, including high-precision, high-value-added products used in photography...

  • Page 37
    ... several years, is expected to ease back from 2013, and its rate of growth will become moderate. The factors behind this include a move away from compact digital cameras associated with the market penetration of smartphones and a drop in demand for single-lens reflex cameras. Hoya's optical business...

  • Page 38
    ... company in the global eyeglass lens market* cith a long business history spanning more than 50 years, Hoya has continued to develop high-quality, high-performance products and provided optimal vision solutions for people all over the corld. As the main driver of grocth in the Life Care segment...

  • Page 39
    Business Overview Lifecare Eyeglass Lenses 2 Hoya s strengths are its proprietary premium lens design technologies and its unique service innovation. The integrated double surface progressive design lenses that Hoya developed for the first time in the world in 2004 offer a wide field of vision ...

  • Page 40
    Business Overview Lifecare Eyeglass Lenses Hoya Faculty Hoya Academy Copyright 2013 © HOYA CORPORATION

  • Page 41
    ... Lifecare Eyeglass Lenses 3 Accelerating growth with a global organization Overseas markets, excluding Japan, account for nearly 80 % of sales in Hoya's eyeglass lenses business. Demand for eyeglass lenses is growing primarily in emerging markets, namely, China, India, South America, Russia...

  • Page 42
    ... in 2012. Then, in 2013, we acquired the Seiko brand eyeglass lens development and manufacturing business from Seiko Epson Corporation and decided to take an equity stake in Seiko Optical Products Co., Ltd., a company that sells Seiko eyeglass lenses. Thus, we are actively promoting business...

  • Page 43
    ... based on customers' opinions directly received from stores and market research, ce are developing and supplying Hoya's original high-value-added products such as bifocal contact lenses and toric contact lenses. 1 Eyecity, Hoya s chain of contact lens specialty stores, boasts the largest number of...

  • Page 44
    ... a chain of contact lens specialty stores with the largest number of customers in Japan, Eyecity stocks about 200 types of products. Moreover, the trust in Eyecity that we acquired by sparing no effort to communicate with customers is the source of its high market share. The Eye Care Division, which...

  • Page 45
    ...enabling early detection and treatment. In addition to medically developed countries, emerging countries such as China and India are facing the need to establish medical infrastructure associated with their economic growth, and improve the people's quality of life (QOL). Against this background, use...

  • Page 46
    ...endoscope business has kept the PENTAX brand for its products. At present, we offer endoscopes for bronchial, digestive tract, ears, nose, and throat uses, and video processors which offer highdefinition endoscope images. In October 2012, we released EPK-i7000, the highest-end model of the i-series...

  • Page 47
    ... in sales Hoya aims to achieve 10% annual growth in sales and outperform market growth rates. In addition to globalizing our organization, we have focused on strengthening our organization in all aspects including research and development, quality and cost control, and after services in recent years...

  • Page 48
    ...Company with Committees Structure HOYA corporation employs a "company-with-committees" management system, which was created as a result of a legislative amendment in June 2003. Under the "company-with-committees" management system, by giving executive officers authority to manage business, business...

  • Page 49
    ... approving major business plans, detailed information is provided to outside directors through means such as presentations by division managers regarding products and business environment. Executive Officers At HOYA, five persons - namely, the Chief Executive Officer (CEO), Chief Financial Of...

  • Page 50
    ... of a director, executive officer, auditor or management employee in the past 5 years. •Those who are operating officers, executive officers or employees of HOYA Group's important clients who make up 2% or more of HOYA's consolidated sales in...

  • Page 51
    ...cer (President, CEO, etc.) and by taking into consideration such factors as the Company's business environment and the levels set by other companies as determined by a survey conducted by an outside professional organization. Performance-based compensation is determined by both financial performance...

  • Page 52
    ... market price one day prior to a Board of Directors resolution regarding stock option grants), ï¬,uctuations in the share price during the exercise period and fixed annual salaries. Based on the above, the number of stock options granted to Outside Directors is fixed each year, whereas the number...

  • Page 53
    ...taken as necessary. Internal Control System In addition to striving to further strengthen corporate governance, HOYA also works toward the development of sound internal control systems with the objective of ensuring appropriate and efficient business management. Each business division and facility...

  • Page 54
    ... and the Articles of Incorporation of the way duties are performed by Executive Officers and employees •T he HOYA Group shall secure systems relating to the HOYA Busine ss Conduct Guidelines that need to be observed by Directors and employees of the HOYA Group. Copyright 2013 © HOYA CORPORATION

  • Page 55
    ... a system for evaluating its financial reporting to ensure the reliability of its financial reporting and valid, appropriate submission of internal control reports as prescribed in the Financial Instruments and Exchange Act. Basic Policy against Anti-Social Forces The Company's Board of Directors...

  • Page 56
    ... in the year-end financial reports. Top management is actively involved in investor relations activities. For example, the CEO attends every quarterly investor meetings to explain results and answer questions from securities analysts and institutional investors. Copyright 2013 © HOYA CORPORATION

  • Page 57
    ... of the Company (present post) 2004 Jun. Representative Director, Chairman and CEO of Kikkoman Corporation 2011 Jun. Honorary CEO, Chairman of the Board of Kikkoman Corporation(present post) Career Summary 1957 Apr. Joined the Ministry of International Trade and Industry (MITI), Japan (present the...

  • Page 58
    ...charge of Development and Manufacturing of IBM Japan, Ltd. 2007 Apr. Technical Advisor to IBM Japan, Ltd 2007 Jun. Director of Benesse Corporation 2008 Apr. Director and Vice Chairman of Benesse Corporation, Chairman of the Board, CEO, and President of Berlitz Corporation 2009 Oct. Director and Vice...

  • Page 59
    ... CEO, Chairman of the Board of Kikkoman Corporation Hoya's strength in our globalized society is, I believe, in ability to devise strategy in a longand to implement it. The company has worldwide business operations and has hired many talented non-Japanese division managers in addition to its CEO...

  • Page 60
    ...in medical-related business and my information on the market trend and others, I would like to actively make remarks and give hints to the Company. I am willing to share my views as a corporate owner, difficulties in management, and experiences of risks and others. Copyright 2013 © HOYA CORPORATION

  • Page 61
    ... culture is all about thorough discussion The members of the Blanks Division engage in various discussions every day. The themes are wide ranging and include products, customers, and technology, but at any rate, this is a team that conducts lively discussions. These discussions are very effective in...

  • Page 62
    ... Assets Employees talk about "Invisible Assets" Aiming for true globalization Of course, HOYA also has its challenges. HOYA is a Japanese company that is developing business globally. However, I feel that it still has to advance in some aspects to become a truly global company. Mind sets of...

  • Page 63
    ... superiors, I also manage the store while having a strong focus on "profit". Since I have the kind of personality that thoroughly gets to the core of something if I do something at all, I am striving to increase profits while checking data that appears on preliminary reports every day and also...

  • Page 64
    ... have brand value so that more customers use our stores with a sense of assurance. I feel that we need to make further efforts to ensure that more customers say "the brand value of Eyecit y is its staf f!" And, I am convinced that day will definitely come. Copyright 2013 © HOYA CORPORATION

  • Page 65
    ... and eyeglass shop owners, and our global staff in the Eyeglass Lens Division. Meet some HOYA customers Region : Singapore Customer Dr. Koh Liang Hcee Designs, coatings and materials, combined with Strong Technical and Sales Support from HOYA team Singapore! Region : Hong Kong Customer Mr...

  • Page 66
    ... VOICE From Vision Care Company Meet some HOYA customers Region : U.S. Customer LaFollette Clinic HOYA partners with our consulting firm, Cleinman Performance Partners, which enables us to provide our patients with the latest techonology while managing our bottom line. Patient satisfaction is...

  • Page 67
    ... have a good evaluation from both customer and consumer. Region : U.S. Doug McClure I am driven by the fact that I take great pride in the Hoya name, I never want to let anyone down, whether it's our customers who depend on us to give them the best in eye care by providing the best in eye glasses...

  • Page 68
    ...Care Company Meet some HOYA employees Region : U.S. Rodney Webb New challenges are the driving force. While there are repetitive duties in our jobs, each day holds new challenges and unique situations that require the best possible solutions. Challenges allow the opportunity to learn something new...

  • Page 69
    11-year Financial Data 2003 Net sales (Millions of yen) Operating profit (Millions of yen) Ordinary profit (Millions of yen) Pretax profit (Millions of yen) Net profit (Millions of yen) 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 246,293 271,443 308,172 344,228 390,093 481,631 453,...

  • Page 70
    11-year Financial Data 2003 Price to earnings ratio (PER) Price to cash flow ratio (PCFR) Price to per-share assets attributable to owners of the Company ratio (PBR) Stock price at yearend (Yen) Number of employees 2004 28.9 2005 20.4 2006 27.7 2007 20.2 2008 12.4 2009 28.4 2010 27.0 2011 ...

  • Page 71
    ... in Japan and other regulations. As a result, sophisticated technologies and highly reliable quality control systems are critical for smooth business operation in this sector. The Other Businesses segment mainly offers information system services, and takes charge of new businesses. Copyright 2013...

  • Page 72
    ... medical endoscopes and contact lens were steady. As a result, HOYA's sales in all operations for the fiscal year under review amounted to ¥372,494 million, down ¥4,446 million (1.2%) year on year. Excluding sales contributed by the PENTAX Imaging Systems Business, which was sold in October 2011...

  • Page 73
    ... acquisition, HOYA will use its global manufacturing and sales network and expand sales of SEIKO branded eyeglass lenses, with the aim of enhancing the corporate value of both companies. 4 5 Recovery from the Flood Damage in Thailand The massive ï¬,ooding that occurred in Thailand in October 2011...

  • Page 74
    ...eyeglass lens business compared to the previous year. At the same time, the Eye City chain of contact lens specialty stores enjoyed continued growth in sales and profit from the previous fiscal year, thanks to new store openings and growth in sales of high-value-added lenses. The medical endoscope...

  • Page 75
    ... to strike a balance between returning profits to shareholders and supplementing internal reserves to fund future growth. HOYA's policy regarding internal reserves is to continue to actively appropriate resources for marketing for consumer products, primarily in the medical field, while also making...

  • Page 76
    ... review increased ¥42,839 million, or 7.4% year on year, to ¥618,074 million. Non-current assets increased ¥24,357 million (14.2%) year on year, to ¥195,917 million. The cost of restoration for major eyeglass lens production sites damaged by the flooding in Thailand and construction of a plant...

  • Page 77
    ... in Vietnam. In the Life Care business, major expenditures included the reconstruction cost for the eyeglass lens production sites which were damaged by the flooding in Thailand in October 9 2011, a n d ex p e n s e s to e n h a n c e p ro d u c ti o n capacity in group factories located in places...

  • Page 78
    ... year on year) and ¥40, 287 million yen payments for redemption of corporate bonds. As a result of the above, the balance of cash and cash equivalents as of March 31, 2013, increased ¥44,124 million from the previous year to ¥248,896 million, including ¥25,078 million effects of exchange rate...

  • Page 79
    ... of Life Care and Information Technology providing eyeglasses, medical endoscopic system, intraocular lenses, optical lenses as well as key components for the semiconductor devices, LCD panels and HDDs. Paid-Capital 6,264,201,967 yen Number of Employees HOYA Group Total; 32,363 Revenue Profit...

  • Page 80
    About Us Stock Information Stock Information Listing of the Company's Shares Number of Shares of Common Stock Trading Unit Number of Shareholders First Sections of the Tokyo Stock Exchanges Authorized: 1,250,519,400 Issued: 435,017,020 March 31, 2013 100 shares 83,560 *the Company implemented ...

  • Page 81
    ...to ï¬,uctuation of exchange rates and interest rates, international situations, market trends and economic conditions, competition, production capacity and research and development capabilities and so on. Please refer to Business Risk. The information posted on this HOYA Annual Report website is not...

  • Page 82
    HOYA R E P O R T 2013