Oki Electric Industry Company, Limited · TSE:6703
Oki Electric Industry — Investor Presentation (March 2007)
26 slides from Oki Electric Industry's investor presentation, Mar 30, 2007
Slide 1: OKI Business Strategies
OKI Business Strategies March 30, 2007 Oki Electric Industry Co., Ltd. c©Copyright ○ Copyright 2006 OkiElectric 2007 Oki Electric Industry Industry Co.,Co.,Ltd. Ltd. S OKI CONFIDENTIAL 11
Slide 2: Table of contents
Table of contents I. Management issues II. Revamping business structure II-1. Implementation Strategy II-1-1: [Measure 1] Business selection and concentration II-1-2: [Measure 2] Revamp towards a more efficient management style II-1-3: [Measure 3] Develop strong businesses with strong products II-2.
Slide 3: I-1. Management issues: Recognition of current situation
I-1. Management issues: Recognition of current situation Though net sales will increase, OKI is regretful to expect a loss for the fiscal year ending March 2007 with declining operating income. The reasons include gaps that occurred between market changes (i.e., needs, speed and competitors) and OKI
Slide 4: I-2. Management issues: Major reasons of current situation
I-2. Management issues： Major reasons of current situation Weakened driving power in business development ¾ Dispersed resources due to expansion in business domain ¾ Declined speed and efficiency in business operation. Insufficient utilization of human resources ¾ Limit in saturated Japan’s domest
Slide 5: Table of contents
Table of contents I. Management issues II. Revamping business structure II-1. Measures for implementation II-1-1: [Measure 1] Business selection and concentration II-1-2: [Measure 2] Revamp towards a more efficient management style II-1-3: [Measure 3] Develop strong businesses with strong products I
Slide 6: II-1. Measures for implementation
II-1. Measures for implementation Reviewing measures announced on February 15, 2007 Measure Measure1: 1: Accelerate Acceleratebusiness businessselection selectionand andconcentration concentration Full Fullexamination examinationofofbusinesses businesses Shift Shift resources to focusingbusine
Slide 7: II-1-1: Accelerate business selection and concentration
II-1-1: [1] Accelerate business selection and concentration Full examination of businesses Consider businesses with 3% or less operating income as subject of withdrawal ¾ Shift resources to focusing business/ Enhance product competitive edge/ Expand sales Consider spinning off or selling out b
Slide 8: II-1-2: Revamp towards a more efficient management style
II-1-2: (2) Revamp towards a more efficient management style Review organization and operation Revamp business operation ¾ Clarify the three roles of measure assigning, implementation and implementation management to monitor business operation in a timely manner ◆ Review Info-telecom Business Gr
Slide 9: II-1-3: Develop strong businesses with strong products
II-1-3. (3) Develop strong businesses with strong products Reestablish differentiating competitive edge based on alliances with global partners ◆ Info-telecom Group: Develop biz. in the NGN era with info-telecom technologies as a core and with strengths in mechatronics ¾ Enhance competitive edge i
Slide 10: II-2. Establishing target for fiscal year ending March 2008
II-2. Establishing target for fiscal year ending March 2008 Achieve a V-sign recovery in the fiscal year ending March 2008 [Establish Target] Operating income (consolidated basis) for fiscal year ending March 2008: Over 8 billion yen c©Copyright ○ Copyright 2006 OkiElectric 2007 Oki Electric Industr
Slide 11: II-3. Deploying measures for a V-sign recovery (short-term)
II-3. Deploying measures for a V-sign recovery (Short-term measures for FY end. March 2008) Implementation of initiatives based on the 3 measures to revamp business structure Improve profit in FY end. March 2008 mainly by implementing urgent measures such as reducing fixed costs, etc. Develop strong
Slide 12: II-3. Deploying measures for a V-sign recovery (mid-long term)
II-3. Deploying measures for a V-sign recovery (Mid-long term initiatives for FY end. March 2008 and after) Improve profitability from FY end. March 2008 and onward (Speedy implementation of each measure) Accelerate selection and Revamp towards an Develop strong biznesses concentration efficient mgm
Slide 13: Table of contents
Table of contents I. Management issues II. Revamping business structure II-1. Measures for implementation II-1-1: [Measure 1] Business selection and concentration II-1-2: [Measure 2] Revamp towards a more efficient management style II-1-3: [Measure 3] Develop strong businesses with strong products I
Slide 14: III-1. Directions for Info-telecom Group
III-1. Directions for Info-telecom Group Position NGN infrastructure and service platform as the core for telecom business domain and strengthen market accessibility and offer Ubiquitous Services to financial and information system markets Financial business: Expand core Mechatronics + info-telecom
Slide 15: III-1. New organization for Info-telecom Group
III-1. New organization for Info-telecom Group Info-telecom Group - Composed with 3 business groups in line with business areas and characteristics Speedy management/ Clarifying biz. and responsibility with autonomous management/ Global business expansion/ Enhanced market accessibility Mobile Mechat
Slide 16: III-2. Telecom Business Group
III-2. Telecom Business Group Business direction Responding to the NGN era, OKI will provide service infrastructure converging carrier and enterprise networks Consolidate carrier business and enterprise network business into Telecom Business Group: Target net sales of 100 B yen in FY ending March 20
Slide 17: III-2. Telecom Business Group: Initiatives to improve profitability
III-2. Telecom Business Group: Initiatives to improve profitability Initiatives to enhance profitability in FY end. March 2008 Target of enhancing profitability: 5 billion yen ¾ Implement thorough cost reduction for GE-PON, CPE, etc. ¾ Reduce variable cost for PBX / Reduce subcontract outsourcing ex
Slide 18: III-3. Financial Business Group
III-3. Financial Business Group Business direction Expand businesses in Japan and overseas based on the 3 business domains: Utilize alliances and position OKI’s mechatronics technologies and financial business know-how as core competence. 1. Mechatronics business: Leveraging OKI’s strong technologie
Slide 19: III-3. Financial Business Group: Initiatives to improve profitability
III-3. Financial Business Group: Initiatives to improve profitability Initiatives to enhance profitability in FY end. March 2008 ¾ Shift resources to focusing businesses/ Enhance market accessibility (120staff) z Increase number of sales reps. and system engineers (SE) to enhance sales structure for
Slide 20: III-4. Information System Business Group
III-4. Information System Business Group Business direction Initiatives to enhance profitability in FY end. March 2008 Aim to become a high profit business by reviewing unprofitable businesses ¾ Review cost structure and shifting to a business with strong z Increase OKI’s hardware sales ratio market
Slide 21: III-5. Semiconductor Business Group
III-5. Semiconductor Business Group Business direction Enhance profitability by developing OKI-unique semiconductor business Contraction of system LSI biz./ Shift to differentiating technologies and application specific standard LSIs/ Create and expand new highly value-added businesses by seeking sy
Slide 22: III-5. Semiconductor Biz. Group: Initiatives to improve profitability
III-5. Semiconductor Biz. Group: Initiatives to improve profitability Initiatives to enhance profitability in FY end. March 2008 ¾ Achieve a business structure with BEP 110billion yen (exclude P-Fab) z Reduce fixed costs: Reduce by 5 billion yen (from FY end. March 2007) z Reduce variable costs z Op
Slide 23: III-6. Printer Business Group
III-6. Printer Business Group Business direction Ensure profit in a global level with color NIP Expand share in the SMB market with Printing Solution as the core Establish “The First Choice Alternative to HP” Thoroughly enhance profitability in SIDM business Public Products for SMB Large-size Securi
Slide 24: III-6. Printer Business Group: Initiatives to improve profitability
III-6: Printer Business Group: Initiatives to improve profitability Initiatives to enhance profitability in FY end. March 2008 Ratio of units sold ¾ Focus on the SMB market 100% (Color NIP) z Accelerate shift to mid-high end models High-end models 75% z Expand sales for high-function small-size A3 c
Slide 25: OKI's Target
OKI’s Target In tandem with implementing urgent measures to achieve a V- sign recovery in the FY ending March 2008, OKI will execute various initiatives based on the three measures to “revamp business structure” and aim to achieve continued profit Operating income Stronger profitability by revamping
Slide 26: Glossary
Glossary P3 NGN Next Generation Network P17 MSPP Multi-Service Performance Platform P4 OEM Original Equipment Manufacturer IP-GW Internet Protocol Gateway P7 BU Business Unit STB Set-top-box P9 LSI Large Scale Integration GE-PON Gigabit Ethernet PON TFT Thin Film Transistor CPE Customer Premise Equi
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