Financial Material

In the year ended March 31, 2009, the vicious cycle of the financial crisis and the worsening of the real economy, triggered by the subprime mortgage loan problem in the U.S., forced the global economy into further recession, with emerging economies beginning to show a trend toward deceleration. In this environment, net sales for the year were 2,847.2 billion yen, down 16.7% from the previous year. Market prices declined, mainly for digital products, which caused a decrease in net sales of 601.7 billion yen, and dramatic fluctuations in foreign exchange rates caused a decrease of 195.0 billion yen. Operating loss was 55.4 billion yen. The decline in market prices and foreign exchange fluctuations led to a drop in operating income, and there were also losses due to additional measures to adjust retailers’ inventory of LCD TVs and panels. Net loss was 125.8 billion yen. We posted a loss on impairment of investment securities of 49.8 billion yen, restructuring charges of 58.4 billion yen arising from reorganization of LCD plants and other measures, and a loss on violation of the antitrust law of 12.0 billion yen resulting from alleged fixing of LCD panel prices in the U.S.

For detailed information, please download Supplementary Data (PDF: 299KB). Note: Sales by each product group include internal sales between segments (Consumer/Information Products and Electronic Components).

Sales of Audio-Visual and Communication Equipment were 1,322.4 billion yen, down 18.6% from the previous year. Unit sales of LCD TVs increased, however, sales on a monetary basis decreased owing to severe price declines and the appreciation of the yen. In addition, mobile phone sales decreased significantly due to the sluggish Japanese market. Sales of Health and Environmental Equipment were 226.1 billion yen, down 9.5%. Sales of air purifiers equipped with Plasmacluster Ion technology and cyclonic bagless vacuum cleaners grew, though sales of air conditioners and microwave ovens declined. Sales of Information Equipment were 357.9 billion yen, down 14.0%. Sales of copiers/printers and facsimiles saw declining sales. As a result, sales of the three product groups comprising Consumer/Information Products were 1,906.5 billion yen, down 16.8% compared to the previous year.

Sales of LCDs were 1,054.5 billion yen, down 14.5% compared to the previous year. Due to significant price declines, sales of large-size LCDs for TVs dropped, as did sales of small- and medium-size LCDs mainly for mobile phones. Solar Cell sales were strong in the first half of the fiscal year. However, in the second half, due to the rapid depreciation of the euro and the pound and to the decrease in the number of solar power generation projects caused by the financial crisis, the sudden worsening of markets was accompanied by price declines in Europe, the main solar cell market. Therefore, despite steady growth in Japan, sales of Solar Cells were 157.1 billion yen, up 4.1%. Sales of Other Electronic Devices were 308.4 billion yen, down 18.3%. Sales of CCD/CMOS imagers decreased due to the slowdown in the mobile phone market. As a result, sales of the three product groups comprising Electronic Components were 1,520.1 billion yen, down 13.8% compared to the previous year.

Operating loss for Audio-Visual and Communication Equipment was 53.5 billion yen, reflecting a significant drop in sales of mobile phones. Price declines, the negative impact from the appreciation of the yen, and adjustment of retailers’ inventory for LCD TVs also led to aggravated reductions in profits. Operating income for Health and Environmental Equipment was 3.7 billion yen, up 1.9 times compared to the previous year, while operating income for Information Equipment was 16.1 billion yen, down 54.1%. As a result, operating loss for the three product groups comprising Consumer/Information Products was 33.7 billion yen.

Operating income for LCDs was 4.0 billion yen, down 95.4% compared to the previous year. This was due to the rapidly worsening supply/demand balance for LCD panels and the accompanying dramatic price declines, and adjustment of retailers’ inventory. Operating loss for Solar Cells was 16.1 billion yen. Rapid price declines and the appreciation of the yen had a negative impact. Operating loss for Other Electronic Devices was 11.9 billion yen. As a result, operating loss for the three product groups comprising Electronic Components was 23.9 billion yen.

Amidst the difficult business environment, we committed to reducing capital investment from the latter half of fiscal 2008. As a result, capital investment was 260.3 billion yen, down 17.4% compared to the previous year. Depreciation and amortization was 271.5 billion yen, down 1.8%. R&D expenditures were 195.5 billion yen, roughly equal to the previous year.