Nikon 2015 Annual Report Download - page 46

44 NIKON REPORT 2015
Management’s Discussion and Analysis
Sales by Business Segment
(Year ended March 31, 2015)
%
n Precision Equipment n Imaging Products
n Instruments n Other
Operating Income (Loss) by
Business Segment (Years ended March 31)
Millions of yen
n Precision Equipment n Imaging Products
n Instruments n Other n Corporate expenses
2012 2013 20142011 2015
–40,000
0
40,000
80,000
120,000
R&D Costs
(Years ended March 31)
Millions of yen
80,000
60,000
40,000
20,000
0
2012 2013 20142011 2015
19.9
68.3
8.5
3.3
* The “Other” segment comprises businesses not included in reportable segments, such as the Glass Business and Customized Products Business.
Beginning with the scal year ended March 31, 2012, the Group has revised its method of accounting for corporate expenses. Figures for operating income (loss) for the years ended
March 31, 2011, are based on the previous method.
¥857,782
million
The breakdown of net sales by business segment for the scal
year under review and the previous year, indicated in brackets,
was 19.9% (21.0%) for Precision Equipment, 68.3% (69.9%)
for Imaging Products, 8.5% (6.6%) for Instruments, and 3.3%
(2.5%) for Other businesses, which were higher proportions year
on year for Instruments and Other businesses.
Business Climate and Issues for the Fiscal Year
ending March 31, 2016
With regard to the business climate surrounding the business seg-
ments of the Group, in the Precision Equipment Business, capital
investments are expected to be strong in the semiconductor-related
eld. In the FPD-related eld, a drastic recovery in capital invest-
ments for small and medium-sized displays and stable capital
investments for large displays are expected. In the Imaging
Products Business, although the compact digital camera market
continues to shrink, it is expected that the extent of contraction in
the market for digital cameras–interchangeable lens type will
diminish and this market will begin to recover from the second half
of the scal year. In the Instruments Business, the microscope-
related eld is expected to recover in Japan and perform rmly in
Asia and the Americas. In addition, robust capital investment is
expected to continue in the industrial instruments-related eld.
Under these circumstances, the biggest issue facing the Nikon
Group is the restructuring of its business portfolio. Under its “Next
100—Transform to Grow,” Medium-Term Management Plan, the
Group needs to be revamped from a three-business enterprise—led
by the Imaging Products Business, the Semiconductor Lithography
Business, and the FPD Lithography Business—into an corporate
entity that grows with a portfolio of six businesses. This restructur-
ing will be achieved by expanding the Microscope Solutions
Business and the Industrial Metrology Business, and by growing the
Medical Business. In striving to bring its Medium-Term Management
Plan to fruition, the Group will invest even more internal and
external management resources and actively participate in M&A.
In its existing businesses, the Group will strive to improve prof-
itability by strengthening constitutions of the Semiconductor
Lithography Business, where impairment loss was recorded for the
scal year under review, and the Imaging Products Business, which
is facing an increasingly severe business situation due to rapid
changes in the market structure. Through these measures, the
Nikon Group will achieve the transformation of its business model
to achieve sustainable growth and endeavor to create new value.
Capital Expenditures and R&D Spending
Capital expenditures were ¥32,550 million for the scal year ended
March 31, 2015, a 28.4% decline from the previous scal year.
Within individual business segments, the expenditures were ¥6,034
million for Precision Equipment, ¥8,329 million for Imaging
Products, ¥1,789 million for Instruments, and ¥8,365 million for
Other businesses. The Group made investments of ¥8,033 million as
corporate assets that are not allocated to the respective reportable
segments. From the scal year under review, the depreciation method
of the Nikon Group has been unied to the straight-line method.
Although R&D costs of ¥66,730 million were 10.5% less than
those of the previous scal year, the proportion of R&D spending
to net sales was 7.8%, an increase of 0.2 percentage point.
Within individual business segments, the costs were ¥20,619
million for Precision Equipment, ¥25,674 million for Imaging
Products, ¥5,139 million for Instruments, and ¥15,298 million
for Other businesses.
Financial Position
Total assets as of March 31, 2015, were ¥972,945 million, an
increase of ¥23,430 million from the previous scal year-end. This
rise was mainly attributable to increased cash and cash equivalents,
which moved up ¥38,257 million to ¥259,625 million. The bal-
ance of noncurrent assets decreased ¥13,264 million to ¥287,429