Fujitsu 2002 Annual Report Download - page 4

Fiscal 2001 Summary
A new revolution in the utilization of information technology is taking place on a
global scale, impacting nearly every aspect of society. In Japan, too, the increasing
importance of IT can be seen in the implementation of the e-Japan initiative, which
aims to create one of the world’s most advanced information and communication
networks. Although the IT industry has experienced a temporary setback, its medium-
and long-term growth prospects are excellent, for it serves as the foundation for the
ultra high-speed, large-capacity networked society of tomorrow.
However, fiscal 2001 was marked by global economic stagnation and cutbacks in IT-
related capital spending. There was a major deterioration in the market for
semiconductors and components owing to a decline in worldwide demand for mobile
phones and personal computers, as well as cutbacks in capital spending by
telecommunications carriers, particularly in North America. This resulted in the most
difficult business environment the Fujitsu Group has experienced.
In this challenging environment, we undertook a comprehensive restructuring of the
Fujitsu Group in order to improve profitability and realize new growth in the mid-term.
We more tightly focused our resources on areas offering potential for high profits and
growth, reorganized and streamlined our R&D and manufacturing operations, and
exited from certain business areas.
Consolidated net sales for fiscal 2001 were ¥5,006.9 billion (down 8.7% from the
previous year), and we posted an operating loss of ¥74.4 billion (compared to an
operating profit of ¥244.0 billion the previous year). In addition, we took a
restructuring charge of ¥417.0 billion, which included the closure of semiconductor
production facilities overseas and the withdrawl from the business of small form
factor hard disk drives for desktop PCs. This resulted in a net loss of ¥382.5
billion (compared to a net profit of ¥8.5 billion the previous year). The reduction in
shareholders’ equity stemming from the large net loss, coupled with an increase in
interest-bearing liabilities, resulted in deterioration of our financial base.
Principal Business Reforms Implemented in Fiscal 2001
To solidify the foundation for greater profitability and achieve new types of growth, we
positioned fiscal 2001 as a year of fundamental structural reform for the Fujitsu Group,
implementing changes focused on three key areas: 1) pursuing higher value-added business
through an orientation toward software and services; 2) focusing more tightly on core
technologies and products; and 3) enhancing the competitiveness of the Group.
Electronic Devices
We closed our Gresham semiconductor facility in the U.S. and consolidated our
fabrication and assembly lines across the Group, thereby streamlining our production
organization. In addition, we concentrated all System LSI (SoC) development work at
our Akiruno Technology Center, where we are aggressively developing advanced
semiconductor technology solutions to help increase the competitiveness of our servers
and networking equipment.
To Our Shareholders
2
From left:
Tadashi Sekizawa, Chairman
Naoyuki Akikusa, President, CEO & COO