Hitachi Koki Medium-Term Plan to Focus on Growth
Hitachi Koki Co., Ltd.
Shinagawa Intercity Tower A, 15-1, Konan 2-chome, Minato-ku
Tokyo, 108-6020, Japan
Listed on the 1st section of the Tokyo and Osaka Stock Exchanges (Code No.: 6581)
October 5, 2000 - Hitachi Koki recently completed the Medium-Term Management Plan that will guide the Company through March 2003. Based on this plan, the Company intends to implement vigorous, resolute business administration in order to attain full-fledged business recovery hereafter. The outline of the Medium-Term Management Plan is as follows:
Basic Target Figures for the Medium-Term Management Plan
Entire Company Consolidated Basis
Unit: millions of yen
| Results for theyear ended March 2000 | Plan for the year ending | |||
| March 2001 | March 2002 | March 2003 | ||
| Net sales | 128,234 | 133,000 | 142,000 | 160,000 |
|---|---|---|---|---|
| Operating income (loss) | (656) | 3,600 | 7,500 | 11,000 |
| Recurring profit (loss) | (2,096) | 1,800 | 5,700 | 9,000 |
| Ordinary income (loss) before income taxes |
(14,781) | 2,300 | 4,500 | 7,800 |
| Net income (loss) | (11,964) | 4,000 | 2,600 | 4,500 |
Entire Company Non-consolidated Basis
Unit: millions of yen
| Results for theyear ended March 2000 | Plan for the year ending | |||
| March 2001 | March 2002 | March 2003 | ||
| Net sales | 90,850 | 94,000 | 99,000 | 108,000 |
|---|---|---|---|---|
| Operating income (loss) | (37) | 4,650 | 5,700 | 7,500 |
| Recurring profit (loss) | 433 | 2,600 | 4,000 | 6,700 |
| Ordinary income (loss) before income taxes |
(16,360) | 2,000 | 3,300 | 6,000 |
| Net income (loss) | (13,204) | 4,000 | 1,900 | 3,500 |
Power Tools Group
Unit: millions of yen
| Consolidated | Results for theyear ended March 2000 | Plan for the year ending | ||
| March 2001 | March 2002 | March 2003 | ||
| Net sales | 77,483 | 79,000 | 85,400 | 94,500 |
|---|---|---|---|---|
| Operating income (loss) | (365) | 2,400 | 3,800 | 5,300 |
| Ratio of operating income to sales | - | 3.0 | 4.4 | 5.6 |
| Non-consolidated | Results for theyear ended March 2000 | Plan for the year ending | ||
| March 2001 | March 2002 | March 2003 | ||
| Net sales | 49,848 | 51,300 | 53,200 | 56,100 |
| Operating income (loss) | (2,255) | 1,300 | 2,000 | 3,000 |
| Ratio of operating income to sales | - | 2.5 | 3.8 | 5.3 |
Printing Systems Group
Unit: millions of yen
| Consolidated | Results for theyear ended March 2000 | Plan for the year ending | ||
| March 2001 | March 2002 | March 2003 | ||
| Net sales | 47,590 | 50,400 | 52,850 | 61,600 |
|---|---|---|---|---|
| Operating income (loss) | (238) | 1,150 | 3,550 | 5,450 |
| Ratio of operating income to sales | - | 2.3 | 6.7 | 8.8 |
| Non-consolidated | Results for theyear ended March 2000 | Plan for the year ending | ||
| March 2001 | March 2002 | March 2003 | ||
| Net sales | 37,842 | 39,100 | 42,050 | 48,000 |
| Operating income (loss) | 2,270 | 3,300 | 3,550 | 4,250 |
| Ratio of operating income to sales | 6.0 | 8.4 | 8.4 | 8.9 |
Scientific Instruments Group
Unit: millions of yen
| Consolidated | Results for theyear ended March 2000 | Plan for the year ending | ||
| March 2001 | March 2002 | March 2003 | ||
| Net sales | 3,160 | 3,600 | 3,750 | 3,900 |
|---|---|---|---|---|
| Operating income (loss) | (52) | 50 | 150 | 250 |
| Ratio of operating income to sales | - | 1.4 | 4.0 | 6.4 |
| Non-consolidated | Results for theyear ended March 2000 | Plan for the year ending | ||
| March 2001 | March 2002 | March 2003 | ||
| Net sales | 3,160 | 3,600 | 3,750 | 3,900 |
| Operating income (loss) | (52) | 50 | 150 | 250 |
| Ratio of operating income to sales | - | 1.4 | 4.0 | 6.4 |
Plan Highlights
1. Thorough Implementation of Efficient Management
2. Reinforcement of Consolidated Group Management
3. Reinforcement of Cost Competitiveness
4. Strengthening of New Product Development Capability
Specific Measures for Individual Groups
Power Tools Group
1. Reviewing production facility utilization
Under the new plan, plants in Japan will manufacture high-added-value products destined for world markets and professional-class products for the Japanese market. The Company will invest in its production facilities in China to develop their capacity to produce professional-class products, do-it-yourself (DIY) items and cordless tools for export to world markets.
2. Promoting alliances and technological cooperation
While considering a possibility of forming mutual product supply-type tie-ups with competitive companies, we will study a plan for covering the field of power tool products that are not produced by ourselves with products of tie-up manufacturers.
3. Increasing sales
Domestically, we will strive to increase sales under Hitachi Koki Sales Co., Ltd., a power tool sales subsidiary established in April this year to improve sales in the important Tokyo and the Kanagawa area, by strengthening direct ties to customers and expanding the commercial reach. We will also step up sales to the home center channel in Japan. In overseas markets, we will emphasize North America as the priority sales region and reinforce sales there through the home center route, in particular.
4. Prioritizing and accelerating new product development
With importance placed on new products for North America and Japan, we will develop our forte products, such as hammers, hammer drills, pneumatic nailers and staplers, disk grinders and circular saws, as well as products with wider markets, including cordless tools and home center items, on a priority basis as a means of sales expansion. Based on the thorough implementation of 3D-CAD and other digital design, furthermore, we will bolster our design development potential and accelerate the speed for product development. We will develop new products that meet future market needs.
5. Building up Total Supply Chain Management (TSCM) system
With importance placed on new products for North America and Japan, we will develop our forte products, such as hammers, hammer drills, pneumatic nailers and staplers, disk grinders and circular saws, as well as products with wider markets, including cordless tools and home center items, on a priority basis as a means of sales expansion. Based on the thorough implementation of 3D-CAD and other digital design, furthermore, we will bolster our design development potential and accelerate the speed for product development. We will develop new products that meet future market needs.
Printing Systems Group
1. Developing next-generation continuous paper laser printers
We will introduce new models designed for high visual quality, further speed increases and superb color capabilities, thereby improving our continuous paper laser printer series. These improvements build on the achievements of our high-speed continuous paper printers, represented by Laser Printer LB16 that features one of the highest printing speeds in the world.
2. Developing an advanced cut-sheet laser printer series
We will put the production of DDP70, a high-speed cut-sheet printer, into high gear and sell the products throughout the world using our own sales channels, other Hitachi channels and collaborating with our OEM partners inside and outside Japan. And, in addition, we will cultivate new markets by introducing POD products based on the DDP70 family for use by the mainstream printing industry.
3. Developing high-end ink-jet color printers
We will promptly develop high-end ink-jet color printers in our new business activities.
4. Reinforcing the solutions business
Formulating an array of products and services that provide a total solutions for customers, through the development of controllers, application software, pre-and post- printing processing equipment and other products. To accomplish this, we will further reinforce our collaboration with external partners, including Hitachi Ltd.
5. Streamlining the product development process
We will improve our design development capability and accelerate the speed of product development through advances in development technology, based on 3D-CAD and other digital design techniques.
6. Building up Total Supply Chain Management (TSCM) system
Shorten the lead time and speed up the turnover of inventory assets by building up the Total Supply Chain Management (TSCM) system.
Scientific Instruments Group
1. Expanding the centrifuge market in the biological research field
We will reinforce efforts to develop centrifugal systems used in the prior processing for genome analysis and centrifuges for the production of influenza vaccines, which are currently in increased demand
2. Globally reinforcing the centrifuge sales and support infrastructure
We will strive to expand sales in the world market and improve our centrifugal product mix by strengthening alliances with overseas companies.
3. Building up Total Supply Chain Management (TSCM) system
Shorten the lead time and speed up the turnover of inventory assets by building up the Total Supply Chain Management (TSCM) system.