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–80
–40
0
80
40
49.54
10.9
26.62
6.8
45.21
12.0
–54.35
23.34
5.0
–13.2
2007 20092008 2010 2011
30
15
0
–15
–30
(Yen) (%)
EPS (Net Income (Loss) per Share),
ROE (Return on Equity)
n฀n EPS (left scale)
ROE (right scale)
(Years ended March 31)
Kazuhiko Kato
Corporate Executive Vice President and Director, Chief Financial Officer
year on year), ¥113 (¥18 stronger), and ¥133 (¥15 stronger) for the
year, respectively. As a result of exchange-rate impact, net sales
declined by roughly ¥160.0 billion. The ratio of sales outside Japan
was 35.1%, down 2.3 percentage points year on year.
Gross profit increased by ¥14.3 billion compared to the previ-
ous year. Despite the adverse effects of the earthquake and yen
appreciation, this outcome was the result of increased sales of LSI
devices and electronic components, lower depreciation and other
fixed costs in the company’s LSI device business as a result of
structural reforms, in addition to unrecognized obligation for
retirement benefits becoming fully amortized in the previous fiscal
year in accordance with a change in accounting standards imple-
mented in fiscal 2000. Even with the continuation of upfront
investments in cloud services and other areas, selling, general and
administrative expenses fell ¥23.8 billion from fiscal 2009 due to
the absence of one-time expenses incurred in the previous fiscal
year in line with the conversion of Fujitsu Technology Solutions
into a wholly owned subsidiary, along with the transfer of the HDD
business and appreciation of the yen.
As a result, operating income amounted to ¥132.5 billion, an
increase of ¥38.2 billion compared to fiscal 2009. The operating
income margin improved 0.9 of a percentage point to 2.9%.
Other income (expenses), net, amounted to a ¥30.3 billion
loss, a deterioration of ¥48.6 billion from the previous fiscal year.
Contributing factors included an improved financial balance
owing to a decline in interest-bearing loans and other factors,
although the net loss on foreign exchange worsened due to the
yen’s appreciation. In addition, a gain on sales of investment
securities was booked primarily from the sale of shares in affili-
ates owned by a UK subsidiary. On the other hand, Fujitsu
recorded a loss due to expenses incurred to recover plant and
equipment damaged in the Great East Japan Earthquake.
As a result, net income for fiscal 2010 was ¥55.0 billion,
representing a year-on-year decline of ¥37.9 billion.
Financial Initiatives in Fiscal 2010
The Fujitsu Group continued to improve its financial position in
fiscal 2010. The owners’ equity ratio rose by 2.5 percentage
points compared to the previous fiscal year to 27.2%, primarily
from a reduction in interest-bearing loans from net income
posted for the year. Free cash flow was a positive ¥113.4 billion.
Although this figure was ¥182.9 billion less than the previous
year, the decline was actually ¥38.2 billion when excluding
proceeds from the sale of investment securities and other special
items. The balance of interest-bearing loans amounted to ¥470.8
billion, a decline of ¥106.6 billion year on year, principally as a
result of redemptions of ¥100.0 billion in convertible bonds that
reached maturity. This put the D/E ratio at 0.57 times, an
improvement of 0.15 points from the previous fiscal year-end.
Consequently, the net D/E ratio was 0.14 times, improving 0.06
of a point to its lowest-ever level.
In June 2011 we announced a management policy whereby
one of our goals is to quickly realize a free cash flow target of over
¥150 billion annually by improving earnings and asset efficiency.
Yen Exchange Rates (Average) (Yen)
Fiscal 2009 Fiscal 2010 Fiscal 2011
U.S. Dollar 101 93 86
Euro 144 131 113
British Pound 174 148 133
(For reference) Impact on operating income (actual) of a one yen (¥1) fluctuation in
the currency exchange rate for fiscal 2010 (approximate)
US dollar: ¥0.9 billion; Euro: ¥0.2 billion; British pound: ¥0.1 billion
0
400
800
1,200
969.5
24.6
821.2
27.2
798.6
24.7
748.9
948.2
24.8 23.2
2007 20092008 2010 2011
60
40
20
0
(¥ Billions) (%)
Owners’ Equity and
Owners’ Equity Ratio
n฀n Owners’ equity (left scale)
Owners’ equity ratio (right scale)
(As of March 31)
MANAGEMENT
023FUJITSU LIMITED ANNUAL REPORT 2011
A MESSAGE FROM THE CFO