Toshiba 2006 Annual Report Download - page 55

9
8
RESEARCH AND DEVELOPMENT
The Group, inspired by the three concepts of “surprise and sensation”, “safety and security” and “comfort”, is dedicated to the
creation of cutting-edge, high value-added technologies able to overcome commoditization. Wide-ranging research projects
promote the development of differentiated technologies and proprietary knowledge in new materials, products and systems,
and further the development of manufacturing technology. In the core business segments of Digital Products, Electronic
Devices and Social Infrastructure, research and development draws on the Group’s technological strengths to develop
engines for future growth to a strategic product map. Efforts are also made to achieve cross functional business synergies,
such as those between the Digital Products segment and Electronic Devices segment to promote the concept of “Toshiba as a
Visual Brand”. The Group’s overall R&D expenditure reached ¥372.4 billion in the fiscal year ended March 31, 2006.
Expenditures for each business segment were as follows:
Billions of yen
Digital Products 108.3
Electronic Devices 174.5
Social Infrastructure 70.9
Home Appliances 17.7
Others 1.0
CAPITAL EXPENDITURES
CAPITAL EXPENDITURE OVERVIEW
The Group’s basis strategy stresses “concentration of management resources in growing fields.” In the term under review,
overall plant and equipment investments (including intangible assets) reached ¥362.9 billion, with the majority from the
Electronic Devices and Digital Products segments. Additional investments totaling ¥186.1 billion were made by Flash
Vision, Ltd., Flash Partners, Ltd. and SED Inc., all affiliates accounted for by the equity method.
In the Electronic Devices segment, capital investments of ¥239.5 billion were directed at increasing capacity and promoting
development of Semiconductor products and in raising output of LCDs. Major projects completed by the Group in this fis-
cal year included the construction of an advanced System LSI facility at Oita and the construction and physical infrastruc-
ture for a NAND flash memory facility at Yokkaichi. Projects currently underway in the segment include a further facility
for NAND flash memory at Yokkaichi Works, a new production line for System LSI and other devices at Iwate Toshiba
Electronics Co., Ltd., and a new plant and manufacturing equipment for low temperature polysilicon LCD at Toshiba
Matsushita Display Technology Co., Ltd.
In the Digital Products segment, capital investments totaling ¥44.2 billion were channeled into development and manufac-
turing of new products, including PCs, imaging products and HDDs.
In the Social Infrastructure segment, capital investments of ¥44.1 billion were made in areas that included system develop-
ment and updating infrastructure equipment. In the Home Appliances segment, ¥27.4 billion was increased for to develop-
ment of new models and manufacturing. The major investment was in new plant and equipment for manufacturing cold
cathode fluorescent lamps at Harison Engineering (Korea) Co., Ltd. Capital expenditures in the Others segment totaled ¥7.7
billion.
PLANS FOR CONSTRUCTING NEW FACILITIES AND RETIRING EXISTING FACILITIES
Group capital expenditures are planned from a three-year perspective, with consideration for manufacturing plans, demand
forecasts, and return on investment. Each segment develops its own plan, while Toshiba corporate provides oversight and
adjustment to prevent unnecessary duplication of investment.
In the year under review, investment in new facilities and equipment upgrades, including intangible assets, totaled ¥644.0
billion. This figure includes ¥300.5 billion invested by Toshiba through three affiliates accounted for by the equity method,
Flash Vision, Ltd., Flash Partners, Ltd. and SED Inc.