Fujitsu 2003 Annual Report Download - page 29

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drop-off in major IT investment in the financial sector
caused sales of large-scale servers and storage systems to
fall sharply. Our withdrawal from the business of small
form factor hard disk drives for desktop PCs was another
factor that contributed to the large overall decline in plat-
form sales compared to the previous fiscal year. Despite the
decline in sales, our restructuring initiatives to streamline
operations, cut costs, and improve efficiency resulted in a
return to profitability. Operating income for the segment
was ¥0.9 billion ($8 million), a ¥58.5 billion improvement
compared to the previous year.
Electronic Devices
Electronic Devices net sales were up 13.2% from the previ-
ous year, to ¥618.6 billion ($5,155 million).
In semiconductors, thanks to the working through of
inventory adjustments, particularly for chips used in digital
AV equipment and mobile phones, sales of logic chips and
flash memory increased. Other areas, such as plasma dis-
play panels and telecommunications components, also
posted higher sales.
Although prices for flash memory products remained
depressed, the semiconductor market as a whole began to
recover. Benefits from the streamlining of our operations
materialized, and strong demand for plasma display TVs
boosted the profitability of our PDP business. While elec-
tronic devices posted an operating loss of ¥31.6 billion
($263 million), this nevertheless represented a major
improvement of ¥77.6 billion over the previous year’s loss.
Financing
Financing net sales were up 4.2% from the previous year,
to ¥119.2 billion ($994 million), with operating income of
¥4.3 billion ($36 million), an increase of ¥0.1 billion.
Other
Other net sales fell 1.2% from the previous year, to ¥241.8
billion ($2,016 million). Operating income was ¥10.0 bil-
lion ($83 million), an increase of ¥9.7 billion.
Net Sales and Operating Income by Business Segment (¥ Billions)
Increase
(Decrease)
Years ended March 31 2002 2003 rate(%)
Net sales
(including intersegment sales)
Software and Services............................ ¥2,138 ¥2,097 (1.9)%
Platforms..................................................... 2,255 1,843 (18.3)
Electronic Devices.................................... 637 687 7.8
Financing.................................................... 123128 3.7
Other........................................................... 371 378 2.0
Intersegment elimination...................... (520) (518)
Consolidated net sales................................ ¥5,006 ¥4,617 (7.8)%
Increase
(Decrease)
Operating Income
Software and Services............................ ¥ 157 ¥176 ¥18
Platforms..................................................... (57) 058
Electronic Devices.................................... (109) (31) 77
Financing.................................................... 4 40
Other...........................................................0 10 9
Unallocated operating costs
and expenses/intersegment
elimination............................................... (69) (59) 10
Consolidated operating income.............. ¥ (74) ¥100 ¥174
Geographic Segment Information
Japan
Domestic sales in fiscal 2002 fell by 5.4%, to ¥3,556.4 bil-
lion ($29,637 million).
Sales of services to the manufacturing, government and
healthcare sectors remained strong, as did sales of out-
sourcing services and mobile phones. Net sales overall
declined, however, as a result of the drop in demand for
optical transmission systems and the effects of our previous
withdrawal from the small form factor hard disk drive busi-
ness for desktop PCs. The streamlining effects of our
restructuring initiatives boosted operating income to
¥160.8 billion ($1,340 million), compared to ¥53.3 billion
the previous fiscal year.
Europe
Reduced sales from the software and support businesses,
along with the effects of the withdrawal from the small
form factor hard disk drive business for desktop PCs, con-
tributed to an 11.3% decline in sales in Europe from the
previous fiscal year, to ¥524.9 billion ($4,374 million).
Operating income, however, improved to a positive ¥3.6
billion ($30 million), compared to an operating loss of
¥17.9 billion in the prior fiscal year.