Fujitsu 2002 Annual Report Download - page 23

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Information Processing
Information processing sales in Japan declined 9.7% from
the previous year, to ¥983.8 billion, and overseas sales
declined 16.8%, to ¥401.4 billion. Overall sales in this seg-
ment totaled ¥1,385.3 billion, a decline of 11.9%.
Domestic sales of enterprise servers and storage equipment
for large-scale systems increased, and new cellular phones
introduced in the second quarter sold well, but demand for
PCs dropped significantly, resulting in lower overall domes-
tic sales. Overseas, our exit from the business of small form
factor hard disk drives for desktop PCs, coupled with cut-
backs in corporate IT spending, especially in the U.S.,
caused sales to decline.
Reflecting the impact of lower sales, operating income
declined by 23.0%, to ¥14.5 billion.
Telecommunications
Telecommunications sales in Japan declined 1.4%, to
¥377.1 billion. Overseas sales in this segment fell 36.1%,
to ¥252.7 billion, resulting in a 19.0% decrease in overall
sales, to ¥629.8 billion. In Japan, amidst a rapid shift
toward broadband networks, demand for conventional
switching systems and other equipment declined. On the
other hand, sales of base station systems and other equip-
ment for 3G wireless networks increased. Overseas, the
weak business performance of telecommunications carriers,
particularly in North America, forced major cutbacks in
capital spending, resulting in sharply lower sales, especially
of optical transmission systems.
Operating income was impacted by the combination of
lower sales of optical transmission systems and lower
prices, resulting in an operating loss of ¥72.4 billion (com-
pared to operating income of ¥37.9 billion the previous
year).
Electronic Devices
Domestic sales of electronic devices totaled ¥263.2 billion,
a decrease of 29.6% from the previous year, and overseas
sales were ¥283.2 billion, a decline of 26.6%. Overall sales
in this segment were ¥546.5 billion, down 28.1%. The
deteriorating supply-demand balance, especially in semi-
conductors, caused unprecedented inventory and
production adjustments and severe price competition. All
major product categories, including flash memory, logic,
SAW filters, and compound semiconductors, experienced
significant sales declines.
Lower sales, steep declines in pricing, and low capacity
utilization rates severely impacted profitability in this seg-
ment, resulting in an operating loss of ¥109.3 billion (com-
pared to operating income of ¥113.4 billion in fiscal 2000).
Financing
Financing net sales totaled ¥114.4 billion, with operating
income of ¥4.2 billion.
Other
Other domestic sales rose 2.4%, to ¥187.5 billion, and
other overseas sales declined 18.1%, to ¥57.2 billion.
Overall, other sales amounted to ¥244.8 billion, a 3.3%
decline. Operating income was ¥0.2 billion, a 96.9%
decline.
Net Sales and Operating Income by Business Segment (¥ Billion)
Increase
(Decrease)
Years ended March 31 2001 2002 rate(%)
Net sales
(including intersegment sales)
Services and Software............................ ¥2,076 ¥2,138 3.0%
Information Processing.......................... 1,842 1,637 (11.1)
Telecommunications .............................. 793 643 (18.9)
Electronic Devices.................................... 908 637 (29.9)
Financing.................................................... 115 123 7.6
Other ........................................................... 381 371 (2.6)
Intersegment elimination...................... (633) (545)
Consolidated net sales................................ ¥5,484 ¥5,006 (8.7)%
Operating Income
Services and Software............................ ¥128 ¥157 22.6%
Information Processing.......................... 18 14 (23.0)
Telecommunications .............................. 37 (72) —
Electronic Devices.................................... 113 (109) —
Financing.................................................... 3 423.8
Other ........................................................... 8 0(96.9)
Unallocated operating costs
and expenses/intersegment
elimination ............................................. (66) (69)
Consolidated operating income.............. ¥244 ¥(74) —%
Segment Information by Region
Japan
Domestic sales in fiscal 2001 fell by 4.5%, to ¥3,759.7 bil-
lion. While services such as systems integration and
outsourcing remained strong, lower unit sales of PCs and
the market imbalance and price erosion in electronic
devices led to lower overall domestic sales. Operating
income declined 83.8%, to ¥53.3 billion.
Europe
A decline in ICL’s sales of infrastructure services, the mar-
ket imbalance in electronic devices, and lower sales of
optical transmission systems and small form factor hard