Omron 2004 Annual Report Download - page 36

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34
demand related to electronic funds transfer systems, including the
modification and replacement of equipment such as ATMs and auto-
mated bill changers, expanded in advance of the planned introduction
of new paper currency in the second half of fiscal 2004. Overseas
demand was also generally firm.
Demand from the train station systems sector also increased,
thanks to the demand for upgrading main equipments to conform to
an improvement in passenger services such as the acceptance of IC
cards. In traffic control and road management system fields, on the
other hand, demands for urban highways-related were robust in the
year under review.
• Health Care Business (HCB)
Sales of HCB were up 10.9 percent year-on-year to ¥46,962 million,
accounting for 8.0 percent of consolidated net sales. Both domesti-
cally and overseas, sales growth stemmed from restraints on public
healthcare spending and increased health-related demands. In the
domestic market, greater numbers of patients with high blood pres-
sure and the increased public awareness of the effectiveness of blood-
pressure taking at home spurred the sales growth of digital blood
pressure monitors. Also, the introduction of new products and
aggressive investments in advertising resulted in a rapid expansion of
the market share for body composition analyzers. In addition, satisfy-
ing the needs of customers for greater compactness helped to pro-
mote the sales of chair massagers. Overseas, sales were up in all
markets, against a background of greater numbers of people with high
blood pressure. In the U.S., in particular, sales of nebulizers for
patients experiencing chronic obstructive pulmonary disease (COPD)
as well as those of digital blood pressure monitors substantially
increased. In China as well, HCB increased sales by expanding the
number of marketing and service centers and promoting demand
through aggressive investments in advertising and sales promotion.
• Other Businesses
Sales of Other Businesses, were down 29.5 percent percentage year-
on-year to ¥24,480 million (accounting for 4.2 percent of consolidated
net sales), due to factors such as exclusion of Omron Alphatec
Corporation from consolidation since the second half of the previous
fiscal year. The primary components of this business field consist of
the Business Development Group’s exploration and nurturing of new
businesses, and the fostering and strengthening businesses not cov-
ered by a specific internal company. In terms of exploring new busi-
nesses, market viability was assessed in machine-to-machine busi-
ness domains such as remote supervisory systems. In existing busi-
ness lines, the market prices for PC peripherals continued to decline,
and in the entertainment area commercial game machines faced inten-
sified competition.
2. Review of Operations by Region
As of April 1, 2003, AEC was separated from ECB. Therefore, prior-
year comparisons of the sales for each segment below are calculated
using the reclassified figures.
• Japan
Sales increases were recorded for all business segments with the
exception of Other Businesses, which was negatively affected by
transfer of the operations of Omron Alphatec Corporation as part of
operational restructuring. Sales to external customers totaled
¥376,349 million, for a 10.5 percent increase over the previous year.
• North America
HCB registered a solid performance, but declines were experienced in
IAB, the ECB, and AEC. This was partly due to the appreciated
Japanese yen and Canadian dollar, as well as reduced unit output by
automakers that affected AEC. Sales to external customers totaled
¥64,613 million, marking a 4.8 percent decline from the previous year.
• Europe
The appreciated euro was a positive factor despite a difficult business
climate, and sales gains were achieved by IAB, ECB, AEC, and HCB.
Sales to external customers reached ¥84,286 million, increasing 14.7
percent from the previous year.
• Asia and Other
IAB, ECB, and HCB chalked up strong performances in Asia and other
regions, and AEC also performed relatively well. Sales to external cus-
tomers totaled ¥59,641 million, increasing 12.3 percent from the previ-
ous year.
Sales Breakdown, by Region
FY03
FY02
FY01
FY00
FY99
Japan North America Europe Asia and Other
71.5%
71.3%
67.0%
63.7%
64.3%
10.7%
10.8%
12.3%
12.7%
11.0%
11.0%
10.3%
12.2%
13.7%
14.4%
6.7%
7.6%
8.5%
9.9%
10.2%