JVC 2009 Annual Report Download - page 9

7JVC KENWOOD Holdings, Inc.
costs and IT-related investments, and the reform of transactions within the Group by strengthening
consolidated management, as well as emergency measures such as the partial return of executives’
remuneration and a review of events. As a result, we produced cost reduction effects of about ¥9.0
billion at the stage of calculation of operating profit for the fiscal year ended March 2009.
For the fiscal year ending March 2010, we are continuing to enhance emergency measures, aiming
to gain substantial effects from the additional measures summarized below.
n Additional measures
During the fourth quarter of the fiscal year ended March 2009, the Group implemented additional measures
centering on the restructuring of JVC’s display business, Kenwood’s car electronics OEM business and
the home audio business, a common business area of both companies, where profitability issues remain;
structural reforms of related production/sales systems and affiliated logistics/services firms; employment
structural reforms, including the cutback of approximately 3,200 Group employees (as of April 20, 2009),
14% of the total number of employees (23,089) at the time of management integration; and further
emergency measures such as the partial return of executives’ remuneration. Of these measures, the
most urgent were completed by the end of the fiscal year under review.
For the fiscal year ending March 2010, we aim to produce cost improvement effects of ¥20.0 billion
or more by combining the cost reduction effects gained from the above-mentioned profit structural
reform and by actualizing the effect of these additional measures.
3. Expansion of profitable sales (Implementation of growth strategies)
n Enhancement of integration
In the Car Electronics business, the JVC Kenwood Group renamed J&K Technologies Corp. (“J&K
Technologies”) to J&K Car Electronics Corporation (“J&K Car Electronics”) on June 24, 2009. In addition
to the development and production functions, the Group also integrated the product planning and
marketing functions into J&K Car Electronics to turn the company into a virtually independent company.
At the same time, the Group promoted thorough personnel exchange between both companies to
strengthen their respective business structures. Through these measures, the Group is deepening the
integration based on cooperation to achieve a complete business integration.
In the Home Audio business, the Group has been integrating all functions of both companies other
than sales, and has consolidated the development and production functions at Victor’s Malaysian plants
Cash Build-up
Inventory reform—Reduction of inventory days
Global fund management reform—Increase and creation of free cash flow
FYE’08/3
105.6
96.6
86.5
68.5
FYE’08/9 FYE’08/12 FYE’09/3 FYE’10/3 target
120
90
60
30
0
Trend of inventory reduction
(billion yen)