Nikon 2013 Annual Report Download - page 28

FINANCIAL SECTION
MANAGEMENT’S DISCUSSION AND ANALYSIS
Nikon Corporation and Consolidated Subsidiaries
For the year ended March 31, 2013
26
2010
0
200,000
400,000
600,000
800,000
1,000,000
2009 2011 2012 2013 2010
80,000
60,000
40,000
20,000
0
-20,000
2009 2011 2012 2013 2010
60,000
40,000
20,000
0
-20,000
2009 2011 2012 2013 2010
120
80
40
0
-40
2009 2011 2012 2013
1601,200,000
(Millions of yen)
100,000
(Millions of yen)
80,000
(Millions of yen) (Yen)
Net Sales
Years ended March 31
Operating Income (Loss)
Years ended March 31
Net Income (Loss)
Years ended March 31
Basic Net Income (Loss)
per Share
Years ended March 31
Business Environment
During the consolidated fiscal year ended March 31,
2013, the production goods market contracted as capital
investment cooled, while the consumer goods market
was visibly split along product lines into growth markets
and shrinking markets. Under such conditions, to expand
business operations and enhance profitability, Nikon worked
to introduce competitive new products, expand production
and sales, and streamline business operations.
In terms of the business environments for the Nikon
Group’s principal businesses, for the Precision Equipment
Business segment, the markets for both IC and LCD
steppers and scanners contracted significantly as
semiconductor and LCD manufacturers scaled back capital
investment. For the Imaging Products Business segment,
the market for interchangeable lens-type digital cameras
deteriorated sharply from the middle of the third quarter,
while the market for compact digital cameras continued
to contract. For the Instruments Business segment, the
market for bioscience instruments was affected by cuts
in capital investment as a result of shrinking public sector
budgets and postponed procurement, while the industrial
instruments market was firm on capital spending related
to smartphones and tablets.
Financial Performance
To transition to an earnings structure appropriate for the
changes in the business environment, Nikon launched new
products, expanded its overseas network, and took steps to
lower costs, including reducing product inventory, revising
the design and development process, and shortening
production lead times.
As a result, on a consolidated basis, net sales increased
¥91,842 million (10.0%) from the previous fiscal year to
¥1,010,494 million. Operating income, however, declined
¥29,079 million (36.3%) to ¥51,002 million, with net income
down ¥16,847 million (28.4%) to ¥42,459 million.
Performance by Business Segment
Business Segment Results
In the Precision Equipment Business segment, the market
contracted as capital investment cooled among semiconductor
and LCD manufacturers. In IC steppers and scanners,
Nikon expanded sales of the NSR-S621D ArF immersion
scanner, offering extremely high precision and throughput,
and compatible with double patterning. We also announced
the new NSR-S622D with further advances in precision, and
received orders for the prototype ArF immersion scanner,
the world’s first scanner compatible with 450 mm wafers. In
LCD steppers and scanners, Nikon recorded steady sales for
5th- and 6th-generation products suitable for mass production
of smartphones and tablets, and expanded sales of the new
FX-67S incorporating a multi-lens system. As a result, despite
efforts to shorten lead times and reduce production costs
throughout the business, net sales in the Precision Equipment
Business segment declined 27.9% year on year to ¥179,013
million with operating income down 69.4% to ¥13,090 million.
In the Imaging Products Business segment, the market
Income (Loss) Analysis
Years ended March 31, 2012 and 2013 % of Net Sales
2012 2013
Net sales 100.0% 100.0%
Cost of sales (61.7) (65.7)
Gross profit 38.3 34.3
SG&A expenses (29.6) (29.3)
Operating income 8.7 5.0
Net other expenses 0.7 1.1
Income before income taxes 9.4 6.1
Income taxes (2.9) (1.9)
Net income attributable to minority interests 6.5 4.2
Net income 6.5 4.2
Note: Expenses, losses and subtractive amounts are in parentheses.