Fujitsu reports fiscal 2010 financial results

Fujitsu Limited, a leading provider of ICT-based business solutions for the global marketplace, today reported consolidated net income of 55.0 billion yen (US$663 million*) for fiscal 2010 (April 1, 2010 – March 31, 2011). Net income fell short of the company’s January 28, 2011 projections after the March 2011 earthquake in eastern Japan caused disruption to Fujitsu manufacturing plants, regional logistics and customer facilities.
Net sales for fiscal 2010 amounted to 4,528.4 billion yen (US$54,559 million), a decline of 3.2{e1f18614b95d3cd6e4b3128e1cd15d99b042a60a5a19c19b7a8e07e7495efa10} from fiscal 2009. In Japan, sales were essentially flat at 2,941.0 billion yen (US$35,434 million). Higher sales of LSI devices and electronic components were offset by temporary production stoppages and shipment delays. Net sales outside of Japan were 1,587.3 billion yen (US$19,124 million), a decrease of 9.2{e1f18614b95d3cd6e4b3128e1cd15d99b042a60a5a19c19b7a8e07e7495efa10} from fiscal 2009, primarily attributable to yen appreciation and divestiture of the hard disk drive business.
Operating income surged 40.5{e1f18614b95d3cd6e4b3128e1cd15d99b042a60a5a19c19b7a8e07e7495efa10}, to 132.5 billion yen (US$1,596 million), driven by improved Group-wide efficiency, particularly in the LSI device business.
Fujitsu recorded an 11.6 billion yen loss on damage, primarily representing the costs of restoring plant and equipment damaged in Japan’s Tohoku earthquake.
“The earthquake devastated Japan’s Tohoku region, throwing into disarray businesses and peoples’ lives,” said Masami Yamamoto, president of Fujitsu. “Tackling the challenges of minimizing supply chain disruption and power outages, we intend to leverage our expertise and state-of-the-art technologies to support economic recovery and improve the lives of people.”
Although all Fujitsu facilities are now ready to resume full production, the impact of the Tohoku earthquake has caused concern about the procurement of raw materials and components as well as uncertainties with regard to ICT investment in Japan. Fujitsu cannot at present reasonably assess how these factors will affect consolidated earnings. Consequently, business performance and dividend projections for fiscal 2011 have not yet been determined. Projections will, however, be disclosed as soon as possible.
Business Segment Results
Consolidated net sales in the Technology Solutions segment which includes the Services and System Platforms sub-segments, decreased 3.7{e1f18614b95d3cd6e4b3128e1cd15d99b042a60a5a19c19b7a8e07e7495efa10}, to 3,014.3 billion yen (US$36,317 million). This was mainly attributable to a strengthening yen. Net sales in the Services sub-segment amounted to 2,419.5 billion yen (US$29,151 million), down 4.8{e1f18614b95d3cd6e4b3128e1cd15d99b042a60a5a19c19b7a8e07e7495efa10} from the previous fiscal year. Sales in Japan were weighed down by constrained corporate spending, and sales outside of Japan experienced the impact of fiscal austerity measures in the UK market and the affect of yen appreciation. Net sales in the System Platforms sub-segment for fiscal 2010 amounted to 594.8 billion yen (US$7,166 million), an increase of 1.2{e1f18614b95d3cd6e4b3128e1cd15d99b042a60a5a19c19b7a8e07e7495efa10}, boosted in part by sales of dedicated servers for the Next-Generation Supercomputer system in Japan, sales of optical transmission systems in the US, and sales of x86 servers in continental Europe. Technology Solutions’ operating income increased by 6.0{e1f18614b95d3cd6e4b3128e1cd15d99b042a60a5a19c19b7a8e07e7495efa10}, to 162.8 billion yen (US$1,961 million).
Net sales in the Ubiquitous Solutions segment amounted to 1,125.6 billion yen (US$13,561 million), essentially unchanged from the previous fiscal year. Sales in Japan increased by 4.6{e1f18614b95d3cd6e4b3128e1cd15d99b042a60a5a19c19b7a8e07e7495efa10}, partly due to the consolidation of Toshiba’s mobile phone business. Sales outside Japan declined by 10.3{e1f18614b95d3cd6e4b3128e1cd15d99b042a60a5a19c19b7a8e07e7495efa10}, primarily as a result of yen appreciation. The operating income declined by 18.0 billion yen, to 22.6 billion yen (US$272 million) mainly because of increased development costs for smartphones and lower prices for feature phones.
Net sales in the Device Solutions segment were 630.6 billion yen (US$7,598 million), a year-on-year increase of 7.0{e1f18614b95d3cd6e4b3128e1cd15d99b042a60a5a19c19b7a8e07e7495efa10}. The segment posted operating income of 20.9 billion yen (US$252 million), a significant improvement after two consecutive years of losses as a result of lower fixed costs achieved through restructuring in fiscal 2009.
Complete information on Fujitsu’s fiscal 2010 financial results, including financial tables, explanation of results and supplementary information, may be found at: http://www.fujitsu.com/global/about/ir/
* All yen figures have been converted to U.S. dollars, for convenience only, at a uniform rate of US$1 = 83 yen, the approximate closing rate on March 31, 2011.
Note: These materials may contain forward-looking statements that are based on management’s current views and assumptions and involve known and unknown risks and uncertainties that could cause actual results, performance or events to differ materially from those expressed or implied in such statements. Actual results may differ materially from those projected or implied in the forward-looking statements.