Pentax 2015 Annual Report Download - page 3

FY2014 FY2015 Growth Rate
Consolidated Sales 427,575 489,961 +14.6%
Consolidated Profit Before Tax 85,486 118,249 +38.3%
Profit from Ordinary Operating Activities 81,117 110,282 +36.0%
* “Profit from Ordinary Operating activities” excludes financial income/costs, share of profit (loss) of associates, foreign exchange gains or losses, and other non-
recurring gains or losses from profit before tax.
HOYA’s Business Portfolio Management and Outlook
The HOYA Group operates a range of different businesses simultaneously, and,
while maintaining a balance among these businesses, HOYA’s basic management
stance is to conduct “business portfolio management” to secure profitability,
stability, and growth for the Group as a whole. One of the features of HOYA Group
management is the development and nurturing of niche markets where it can
demonstrate its strengths, and maximize profitability by capturing a high market
share in these markets. In other words, HOYA’s base strategy is to be “a big fish
in a small pond.” In the Information Technology field, this structure has been put
into place, and there are many businesses where we already have a high market
share. As a result, we have secured relatively high profitability in those markets.
On the other hand, market trends in these businesses are a factor determining
HOYA’s performance. In mature markets, we want to continue to secure stable
earnings by anticipating future changes in the business environment and
responding promptly.
On the other hand, in the Life Care field, there are businesses where we are not “a
big fish in a small pond,” because within large markets, there are competitors that
are bigger than HOYA, and we are the No. 2 company. All our markets are
expected to expand in the long term, and there are domains where there is
considerable room for growth. Going forward, the issue of most importance for
HOYA’s growth will be expanding its market share.
To expand market share, we will not make a frontal attack on competing
companies, but further segment the markets by region and type of product and
specify the markets where we will compete (i.e., win). In these domains, we will
work to expand our market share by allocating resources on a priority basis. In other words, we will take the
initiative to divide up the large pond and create smaller ponds, and then cultivate large fish for the small ponds.
This is a task that will take time, but repeating these initiatives over periods of 10 or 20 years will be the most
efficient and realistic method for implementing the corporate strategy that HOYA has established of being “a big
fish in a small pond.”
HOYA’s current business portfolio management is the accumulation of past experiences of success and failure and
is the result of a transitional process of choosing and exiting various businesses. When choosing to enter business
domains, we emphasize logical thinking based on objective data. I think that HOYA is a company where reaching
an internal consensus on corporate directions derived from objective data is relatively easy. The practice of making
decisions based on logical thinking is clearly recognized as the proper course of action, and the implementation of
these actions is a matter of course. This practice was rooted in HOYA’s corporate culture before I became CEO.
The makeup of the current portfolio is definitely not optimal; I believe we should be constantly evolving the
portfolio in response to changes in society and technology. Along with changes in the times, new markets come
into being, and we want to focus on investing corporate resources in these new opportunities.
Performance in fiscal 2015
(Millions of yen)
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