NEC 2013 Annual Report Download - page 4

Download and view the complete annual report

Please find page 4 of the 2013 NEC annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 64

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64

MESSAGE FROM THE PRESIDENT
Nobuhiro Endo
President, NEC Corporation
In the previous fiscal year (fiscal 2012, the year
ended March 31, 2012), NEC unavoidably posted a
consolidated net loss of ¥110.3 billion, including
business structure improvement expenses. Our
bottom line was affected by major upheavals in the
economic environment due to the fiscal crisis in
various European countries, along with the impact
of the Great East Japan Earthquake and the
flooding in Thailand. These factors were
compounded by the review of deferred tax assets
reflecting tax reforms in Japan and deterioration in
our financial results for fiscal 2012.
Against this backdrop, in the fiscal year under
review (fiscal 2013), we initiated structural reforms
directed at transforming NEC into a profitable
enterprise. At the same time, the NEC Group
reviewed its business portfolio and strove to
implement reforms designed to transform itself into
a stable cash flow-driven enterprise with four core
businesses, namely the IT Services business,
Carrier Network business, Social Infrastructure
business and Energy business.
Looking first at structural reforms, the NEC Group
reduced its workforce by approximately 10,000
headcount as originally planned. The mobile phone
business and the platform business streamlined their
development and production structures. In addition,
NEC implemented measures such as wage
reductions for officers and employees. These
initiatives yielded a positive impact of ¥40.0 billion on
operating income as planned. Regarding the NEC
Group’s business portfolio review, for the electronic
components business, NEC formed a capital and
business฀alliance฀with฀a฀U.S.-based฀company,฀
resulting in the deconsolidation of NEC TOKIN
Corporation. Moreover, Renesas Electronics
Corporation, an NEC equity-method affiliate, decided
to accept an infusion of capital via a third party share
allotment to the Innovation Network Corporation of
Japan and eight private enterprises. As a result, NEC
plans to exclude Renesas Electronics from treatment
as an equity-method affiliate.
In terms of focusing on its four core businesses,
the NEC Group worked to build a foundation for
03 NEC Corporation
Annual Report 2013