Olympus 2006 Annual Report Download - page 19

> The Medical Systems Business supplies gastrointestinal endo-
scopes, endoscopic ultrasound systems, and minimally invasive
products such as surgical endoscopes and endo-therapy devices
as its key products, and the business operations are primarily
handled by one of Olympus’ consolidated subsidiaries, Olympus
Medical Systems Corp. Among such products, gastrointestinal
endoscopes account for an approximate 70% share of the global
market, providing a solid earnings foundation for the Olympus
Group. During the fiscal year under review, sales in the Medical
Systems Business stood at ¥266,317 million (US$2,316 mil-
lion), up 15.5% from the previous fiscal year. Operating income
increased 17.4% year on year to ¥76,642 million (US$666 mil-
lion), due to the expansion of overseas sales.
G A S T R O I N T E S T I N A L E N D O S C O P E S
> Sales of gastrointestinal endoscopes rose 18.5% to ¥175,033
million (US$1,522 million).
In the domestic market, the launch of the new upper gastrointes-
tinal videoscope GIF-N260 contributed to a sales increase, owing
to its high image quality, equivalent to existing videoscopes,
while realizing a smaller diameter at the distal end. In addition,
Olympus experienced an increase in the number of medical facili-
ties that adopted the Value-per-Procedure program, a special pro-
gram designed to promote the installation of endoscope systems
without initial investment. As a result of these factors, domestic
sales were up 12.9% from the previous fiscal year. Overseas,
sales grew 20.7% year on year due to healthy demand for the
EVIS EXERA II high-definition endoscope system in the United
States and Europe, and Olympus’ strong sales promotion efforts
in Asia and Central and South America.
In October 2005, Olympus commenced sales in Europe of the
Capsule endoscopes for the small bowel. Taking advantage of
its cutting-edge technologies, including micromachine technology
and nanotechnology, Olympus is expected to contribute further to
the progress of minimally invasive medical care.
Moreover, Olympus is actively engaged in new business alli-
ances. During the fiscal year under review, Olympus bolstered
business cooperation with Terumo Corporation. Looking ahead,
Olympus will aim for new product development by combining its
advanced capabilities in the gastrointestinal and surgical fields
with Terumo’s strength in the circulatory system field.
M I N I M A L L Y I N V A S I V E P R O D U C T S
> Sales of minimally invasive products stood at ¥91,284 million
(US$794 million), up 10.1% from the correspondence period of
the previous fiscal year.
In the domestic market, sales grew for videoscopes featur-
ing a diameter of 5.4 mm at the distal end for abdominal and
chest cavities, and the new HF Surgery System for Transurethral
Resection gained popularity, contributing to the sales increase.
Overseas, Olympus saw favorable demand for endo-therapy
devices that arrest bleeding, sampling endo-therapy devices, and
the pancreaticobiliary duct endo-therapy device, V-System, in the
United States and Europe. In line with this, Olympus’ endeavors to
improve its sales structure in Asia and Central and South America
also contributed to the significant revenue increase.
O U T L O O K F O R F I S C A L 2 0 0 7
> Olympus will continue to offer secure, safe and highly efficient
medical devices in fiscal 2007. By doing so, Olympus will build
a business structure that enables steady profit increase amid an
increasingly severe environment, with intensifying competition
and pressure to reduce medical costs. Furthermore, Olympus
will strengthen its approach to the minimally invasive medical
care field and investment of management resources in the BRICs
nations (Brazil, Russia, India and China), particularly in China.
With these efforts, Olympus expects ¥290 billion of net sales and
¥81 billion of operating income for fiscal 2007.
Medical
Systems
Business
Sales
(Millions of yen)
266,317
69,496
05 06
Overseas sales
Domestic sales
230,525
62,462
168,063
196,821
M E D I C A L S Y S T E M S
B U S I N E S S
OLYM PUS 20 06 17