Review of Operations

Overview of Results

In the electronics industry during the year ended March 2013, demand grew for smartphones and tablet devices. In contrast to this, the market continued to be sluggish centered on PCs and TVs. As a result, demand for electronic components was weak.
Under these harsh conditions, the TAIYO YUDEN Group worked to achieve the targets of its medium-term management plan. We moved ahead with our structural improvement measures, including shifting the production of capacitors and inductors offshore from Japan to other countries, and worked to expand sales of super high-end products. In conjunction with these and other growth strategies, we implemented profit improvement measures. As a result, consolidated net sales for the year ended March 2013 rose 5.0% compared with the previous fiscal year to ¥192,903 million. Operating income improved to ¥4,993 million from an operating loss of ¥8,010 million for the previous fiscal year.

Overview by Business Segment

Electronic Components

The Electronic Components business manufactures and sells capacitors, inductors, SAW/FBAR devices for mobile communications, energy devices and other electronic components.
In the year ended March 2013, the electronics industry saw continued growth from the smartphone and tablet device markets. In contrast to this, the PC and television markets remain sluggish. Overall this has caused weaker demand for electronic components.
The TAIYO YUDEN Group has implemented a series of structural reforms that are measures management believes will improve operations and foster growth needed to achieve the targets established for the year ending March 2015, which is the final year of our medium-term management plan. The measures implemented to improve operations include the process of shifting the production of capacitors and inductors offshore from Japan to other countries, which is consistent with efforts to maximize the use of its overseas production sites. Our growth strategies include the expansion of sales and the emphasis on super high-end products, including capacitors, inductors, and SAW/FBAR devices for mobile communications.
As a result, consolidated sales in this segment rose 6.3% year over year to ¥170,925 million, and operating income amounted to ¥5,217 million, compared to an operating loss of ¥6,689 million for the previous fiscal year.

＜Sales of Electronic Components by Market Sector ＞

The breakdown for sales of electronic components by market sector comprised 20% for consumer products, 20% for information equipment, 34% for communication equipment, 21% for components, and 5% for others.
Sales for consumer products declined 4% year over year due to the slump in demand for televisions and other products, but sales for communication equipment increased 15% year over year due to the expansion of the smartphone market. As a result, sales in this segment rose significantly year over year.

Optical Media and Others

The Optical Media and Others business manufactures and sells optical media products and engages in other businesses.
In the year ended March 2013, the TAIYO YUDEN Group continued with initiatives aimed at returning the optical media products business back to profitability.
As a result, although consolidated sales in this segment declined 4.2% year over year to ¥21,978 million, the operating loss amounted to ¥224 million, an improvement of ¥1,096 million from the previous fiscal year's operating loss.