Fujitsu 2002 Annual Report Download - page 21

19
Net Sales
In the fiscal year ending March 31, 2002 (fiscal 2001), the
Fujitsu Group faced a difficult global economic environ-
ment, with the impact of the slowdown in the U.S.
economy reverberating throughout Japan, Europe and Asia
through December. The IT industry has good prospects for
growth in the medium to long term, owing to its core role
in supporting emerging high-speed, large-volume net-
works. However, it was in an exceptionally severe position
throughout fiscal 2001, as global shipments of cellular
phones and personal computers declined, and telecommu-
nications carriers around the world, particularly those North
America, continued to sharply curtail capital investment.
On the other hand, since January there have begun to
be indications of a market recovery, including signs —
mainly in the U.S. and Asia — that the economy has bot-
tomed out; that the slump in overseas demand for PCs and
mobile phones may be ending; and that inventory adjust-
ments in semiconductors may have run their course.
Against this backdrop, consolidated net sales in fiscal
2001 were ¥5,006.9 billion, an 8.7% decline from the pre-
vious fiscal year.
In Japan, responding to diverse market needs in the
area of large-scale IT systems for enterprises and organiza-
tions, we achieved higher sales of systems integration and
outsourcing services, as well as enterprise servers. Sales of
base station systems and other equipment for 3G telecom-
munications services also increased. Still, with sluggish
demand for PCs worldwide and a glut of electronic devices
eroding prices, revenues in those areas fell, resulting in a
3.6% decline in overall domestic sales, to ¥3,460.9 billion.
Overseas, deterioration in the financial performance of
telecommunications carriers, especially in North America,
led to large cutbacks in capital spending, and sales of opti-
cal transmission systems were sharply lower. In addition,
our exit from the business of small form factor hard disk
drives for desktop PCs, the severe deterioration in demand
for electronic devices, and lower sales in our European and
U.S. services businesses all contributed to an 18.4% overall
decline in overseas sales, to ¥1,546.0 billion.
Cost of Sales,
Selling, General & Administrative Expenses,
and Operating Income
The cost of sales for fiscal 2001 totaled ¥3,731.2 billion,
5.4% lower than the previous fiscal year. The cost of sales
ratio rose 2.6%, to 74.5%. The gross profit on sales (net
sales minus the cost of sales) was ¥1,275.7 billion, a
decline of 17.3%. The gross profit margin was 25.5%,
2.6% lower than the previous year’s figure of 28.1%. The
decline in profitability resulted from lower demand and
prices in telecommunications and electronic devices, as well
as lower capacity utilization.
Selling, general and administrative (SG&A) expenses
totaled ¥1,350.1 billion. Some indirect costs related to
operational control that previously were included in the
cost of sales are included in this period’s SG&A expenses.
Due to this and other factors, SG&A increased by 4.0%,
and it rose 3.3% as a percentage of sales, to 27.0%. Our
R&D investments were focused on web services and other
advanced technologies in software and services, computer
and telecommunications systems for next-generation net-
works, and the electronic devices that power these systems.
As a result, the portion of SG&A attributable to R&D
spending was ¥349.8 billion, down 13.3% from the previ-
ous year.
FINANCIAL
SECTION
Services and Software
Electronic Devices
Information Processing
Financing
Telecommunications
Net Sales by Business Segment (excluding intersegment sales)
(¥ Billion)
(Years ended March 31)
Other Operations
R&D Expenditure (¥ Billion)
Ratio of R&D Expenditure to Net Sales (%)
(Years ended March 31)