Kenwood 2006 Annual Report Download - page 10

The Kenwood Group completed the final stage of its reforms
on the financial base and capital structure based on the Value
Creation Plan, the Group’s second mid-term business plan
announced in May 2005, and has now begun implementing
new strategies to expand corporate value through the
promotion of growth strategies and the reforms of our profit
structure.
These strategies that will expand corporate value, realize
further growth and achieve higher profitability are aimed at
reaching the goal of becoming a member of the Billion Dollar
Club in the earliest possible timeframe.
More specifically, the new strategy consists of the following
processes. First, the Kenwood Group plans to enhance stable
sales and revenues in core businesses such as Car Electronics
Consumer (Audio) and Communications Equipment businesses.
At the same time, the profit structure of growing businesses
such as Car Electronics OEM and Car Electronics Consumer
(Multimedia) businesses will be reformed and overlapped on
top of these core businesses. Finally, the structural reform of
the Home Electronics business will be promoted to open up
new frontiers in “Seamless Sound Entertainment,” because the
rising popularity of digital media content and the development
of digital and network environments are considered to provide
new business opportunities.
Promoting the growth strategies and reforms of
profit structure
Aiming to profitable growth through reforming profit
structure of growing businesses in addition to core
businesses
The following measures were taken to reform the profit structure in
the Car Electronics Consumer (Multimedia), Car Electronics OEM
and Home Electronics businesses. By doing so, the Group was able
to achieve the results it had forecast at the beginning of the fiscal
year.
Growth strategy and profit structure reform by
the strategy change of the Car Electronics
Consumer (Multimedia) Business
Self development and added product lineups of car
navigation systems, and reforming overseas business
utilizing new concept car navigasion systems
Having completed the strategy change that was implemented to
switch from joint development to self development of car navigation
systems in the fiscal year ended March 2005, the Company started
full scale operations for self developed on-dashboard type models,
and conducted version upgrades in the fiscal year ended March
2006. The Company also improved its product lineups by
introducing integrated AV models with high quality sound in
February 2006. In addition, the Company introduced new concept
products, which integrates the core portion of portable navigation
systems and car multimedia systems, to overseas markets, and
promoted its growth strategy for car navigation systems both
domestically and globally.
Furthermore, the Company stepped up its efforts to strengthen its
car multimedia products, including visual devices, which are
currently showing strong global growth, and digital broadcast
devices, which are anticipated to become more and more popular in
the future, completed its strategy change of the Car Electronics
Consumer (Multimedia) business as initially planned, significantly
improved profitability, and started new growth strategy on a full
scale basis.
Major Accomplishments of Consolidated Accounts for the Fiscal Year Ended March 2006
Completed the final stage of our reforms on the financial base and capital
structure, and enhanced the implementation of new strategies to expand
corporate value through the promotion of growth strategies and the
reforms of our profit structure.
2006.3
JPY in Billion
Consolidated net sales by business segment
Communications Equipment Business
Home Electronics Business
Car Electronics Business
Others
2005/3
104.8
55.1
18.9
181.1
（＋1.4% YOY）
（＋6.5%）
（＋2.8%）
（-21.0%）
2006/3
107.7
58.6
14.9
183.6
200
150
100
50
0
New-concept navigation systems for overseas markets
Self-developed car navigation systems, which expand product lineups
(Compatible with iPod, WindowsⓇ Automotive installed)
Car navigation systems that drive the growth
of the Car Electronics Business
iPod is a registered trademark of Apple Computer, Inc. in the United States and other countries.
MicrosoftⓇ and WindowsⓇ Automotive are registered trademarks or trademarks of
Microsoft Corporation in the United States and other countries.
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