Nikon 2004 Annual Report Download - page 5

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Consolidated฀net฀sales฀were฀up฀8.0%฀on฀a฀year-on-
year฀basis฀to฀a฀record฀high฀of฀¥506,378฀million,฀due฀pri-
marily฀to฀expanded฀sales฀of฀digital฀cameras.฀Operating฀
income฀was฀down฀12.2%฀to฀¥3,675฀million฀(compared฀
with฀¥4,187฀million฀in฀the฀previous฀year),฀due฀to฀defer-
ment฀in฀semiconductor฀investment,฀and฀intensifying฀
price฀competition฀and฀problems฀in฀certain฀areas฀of฀
supply฀in฀digital฀cameras.฀Partly฀due฀to฀extraordinary฀
income,฀we฀posted฀consolidated฀net฀income฀of฀¥2,410฀
million฀for฀the฀year฀(compared฀with฀a฀net฀loss฀of฀¥8,143฀
million฀in฀the฀previous฀fiscal฀year).
Although฀we฀fell฀short฀of฀achieving฀a฀full-scale฀
recovery฀in฀results฀across฀the฀Nikon฀Group,฀I฀believe฀
effective฀actions฀taken฀in฀each฀business฀domain฀
throughout฀the฀year฀will฀provide฀an฀invaluable฀stepping฀
stone฀to฀future฀progress.
Business฀Outlook
Although฀elements฀of฀uncertainty฀remain,฀the฀economic฀
climate฀is฀expected฀to฀continue฀improving฀on฀the฀whole.฀
The฀business฀environment฀surrounding฀the฀Nikon฀Group฀
is฀currently฀undergoing฀an฀upturn฀–฀the฀digital฀cam-
era฀market฀continues฀to฀expand฀amid฀rapid฀growth฀in฀
SLR-type฀digital฀cameras,฀while฀a฀large฀increase฀in฀LCD฀
panel฀investment฀and฀resurgence฀in฀the฀semiconductor฀
market฀are฀anticipated฀to฀have฀a฀beneficial฀effect.฀
We฀plan฀to฀grasp฀all฀opportunities฀throughout฀the฀
Nikon฀Group฀to฀realize฀a฀V-shaped฀recovery฀and฀stimu-
late฀new฀growth฀in฀the฀year฀ending฀March฀2005,฀thereby฀
restoring฀profitable฀earning฀structures.฀Our฀strategy฀is฀to฀
launch฀competitive฀products฀in฀markets฀that฀are฀expand-
ing฀(SLR-type฀digital฀cameras฀and฀LCD฀steppers)฀or฀in฀
a฀recovery฀phase฀(IC฀steppers)฀to฀expand฀and฀enhance฀
these฀key฀business฀areas.฀We฀will฀also฀actively฀continue฀
to฀pursue฀R&D฀activities฀so฀that฀we฀can฀leverage฀our฀
unique฀technologies฀to฀cultivate฀new฀businesses.
At฀the฀same฀time,฀we฀continue฀to฀focus฀on฀making฀
the฀most฀efficient฀use฀of฀assets฀and฀capital฀investments฀
to฀strengthen฀our฀finances.฀We฀are฀also฀using฀business฀
process฀reforms฀to฀make฀our฀operations฀more฀efficient.฀
Through฀such฀company-wide฀efforts,฀we฀will฀generate฀
stable฀cash฀flow฀and฀quickly฀realize฀a฀strong฀financial฀
structure฀that฀will฀enable฀us฀to฀conduct฀ongoing฀invest-
ment฀as฀well฀as฀deal฀with฀any฀changes฀in฀the฀market.฀
Our฀aim฀is฀to฀greatly฀improve฀the฀profitability฀of฀the฀
Nikon฀Group.฀
We฀will฀continue฀to฀provide฀stable฀dividends฀to฀
shareholders฀based฀on฀consideration฀of฀business฀results฀
and฀the฀need฀to฀conduct฀medium-฀to฀long-term฀invest-
ment฀in฀R&D฀and฀growth฀areas.
We฀ask฀shareholders฀and฀investors฀to฀understand฀
our฀current฀situation,฀and฀to฀extend฀us฀your฀continued฀
support฀as฀we฀execute฀ongoing฀reforms.
July฀2004
Shoichiro฀Yoshida
Chairman฀of฀the฀Board฀and฀
Chief฀Executive฀Offi฀cer
Kenji฀Enya
Vice฀Chairman฀of฀the฀Board฀and฀
Chief฀Financial฀Offi฀cer
Teruo฀Shimamura
President,฀Member฀of฀the฀Board฀and฀
Chief฀Operating฀Offi฀cer
From฀left:฀Shoichiro฀Yoshida,฀Kenji฀Enya,฀Teruo฀Shimamura
3