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6
Management’s Discussion and Analysis
SOCIAL INFRASTRUCTURE
Social Infrastructure saw overall sales decline by 93.3 billion yen to 2,302.9 billion yen. Nuclear Energy Systems posted
healthy sales in respect of new plants overseas and maintenance and service, and the overall decline in segment sales primarily
reflected a fall in orders in areas other than Nuclear Energy Systems.
Segment operating income increased by 23.1 billion yen to 136.3 billion yen. The Nuclear Energy Systems recorded high-
er operating income on increased sales, and the Medical Systems business maintained high profitability. Other businesses in
the segment also secured operating income at the same level as a year earlier, mainly reflecting successful efforts to cut costs.
HOME APPLIANCES
Home Appliances saw sales decrease by 94.5 billion yen to 579.8 billion yen. Sales in Air-conditioning and Lighting Systems
were affected by the decrease in housing and building starts. Declining consumption also brought lower sales to White
Goods.
The segment as a whole recorded an operating loss of 5.4 billion yen, an improvement of 21.7 billion yen compared with
the previous year, and in the second fiscal half the segment returned to the black. Most notable were the major improvement
in performance in White Goods, reflecting progress in cost reductions, and the improvement in the Lighting Systems
Business.
OTHERS
Others saw sales fall by 18.5 billion yen to 315.8 billion yen, and operating income (loss) fell by 4.8 billion yen to -4.3 billion
yen.
The Company’s Consolidated Financial Statements are based on U.S. GAAP.
Operating income (loss) is derived by deducting the cost of sales and selling, general and administrative expenses from net
sales, and reported as a measurement of segment profit or loss. This result is regularly reviewed to support decision-making
in allocations of resources and to assess performance. Some items that are classified as operating income (loss) under U.S.
GAAP, such as restructuring charges and gains (losses) from the sales or disposal of fixed assets, may be presented as non-
operating income (loss).
The Mobile Broadcasting business ceased operation at the end of FY2008, and its results are not incorporated into net
sales, operating income (loss) or income (loss) from continuing operations, before income taxes and noncontrolling interests
in the consolidated results. The business is classified as discontinued in the consolidated accounts, in accordance with ASC
No.205-20, “Presentation of Financial Statement-Discontinued Operations”, equivalent to the former SFAS No. 144. However,
consolidated net income (loss) (consolidated net income (loss) attributable to shareholders of Toshiba Corporation) includes
the operating results of the Mobile Broadcasting business.
RESEARCH AND DEVELOPMENT
The Group, aiming to restart to the path of “Sustained growth with steadily higher profit”, is anticipating customers’ require-
ments through strict benchmarking and “Imagination”, and promoting R&D activities to provide products that lead to new
trends in the market.
In a severe economic situation, the Group reduced R&D expenditures by 15% against FY2008, under the “Action
Programs to Improve Profitability” announced in January 2009. As it did so, the Group selected areas for investment under
the following three criteria:
1) Company-wide staff division for R&D undertook research into technologies with the potential to become the basis for
innovative products, focusing on megatrends (anticipated business opportunities in the field of vital and healthcare ser-
vices, such as demands for energy and environmental technologies in emerging countries and demands for medical care
and education, and in the field of ICT(Information and communications technology) with the basis of worldwide
trends to digitalization, networking and transfers of huge volumes of information);
2) R&D facilities of the in-house companies and the Group companies focused on developing essential technologies for
application in brand new products ahead of other companies; and
3) the Group enhanced the efficiency of R&D activities by promoting common platforms, using overseas subsidiaries for
software developing and focusing on growing markets.
The Group’s overall R&D expenditures reached 323.2 billion yen in the fiscal year ended March 31, 2010. Expenditures
for each business segment were as follows: