Consolidated Results for the Full Year Ended March 31, 2012

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FAQ Summary of the Question-and-Answer Session at Seiko Epson's Announcement of Consolidated Results for the Full Year (ended March 31, 2012).



Q&A summary

Click on the appropriate question to view the answer.


Overall

Q

Your operating income outlook for the second half FY2012 is significantly larger than operating income for the first half. What are the environmental factors behind this?


Q

The third quarter is the most important selling season for products such as inkjet printers and projectors. Total net sales and operating income are higher in this period than at other times of the year.
In the first half of FY2012, consumables sales will still have not fully recovered from the reduction of inkjet printers in FY2011 caused by the earthquake in Japan. However, the install base will have recovered by the second half, where we will also be boosted by improved consumables sales stemming from the increase in sales of inkjet printers for the office. We will also experience reduced costs from sales of compact inkjet printers, and increased sales of large format printers due to the introduction of new models.


Q

Why will companywide expenses increase in FY2012?


Q

We are presently rightsizing our microdevices business to a scale in line with its net sales. We are transferring staff to the information-related equipment segment and other growth areas, and expect to see a temporary rise in expenses related to the transfer of these staff.


Q

What are your exchange rate assumptions and projected exchange rate sensitivity for FY2012?


Q

Our projected exchange rates are 75 yen to the US dollar and 100 yen to the euro. For every one yen depreciation against the dollar and euro we forecast positive impacts of 200 million yen and 1.2 billion yen, respectively.


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Information-related equipment

Q

In inkjet printers, what are the latest trends in the market overall, and for Epson in particular?


Q

In FY2011, the global inkjet printer market contracted slightly. In the first half, Epson's unit sales declined compared to the previous year due to the manufacturing restrictions caused by the earthquake in Japan. However, sales of our new products proceeded well in the second half, and exceeded the previous year in all major regions of the world.
In FY2012, the overall market will grow slightly. We expect sales of Epson inkjet printers to continue expanding from the second half of FY2011 and to exceed the rate of market growth.


Q

How have sales of the high-capacity ink tank printer fared, and what is your plan for this product in FY2012?


Q

In FY2011, we rolled out this product from Asia into regions such as Latin America and Eastern Europe, and achieved our target of sales in 29 countries and regions. In FY2012, we will expand our lineup, and are making plans for further expansion.


Q

Epson is forecasting increased sales of visual products in FY2012. Which products are you expecting to sell well?


Q

We will further boost our projector lineup by expanding sales of office and high-brightness products in developed economies, and also to emerging economies. We expect our sales to exceed the rate of market growth.
We expect increased sales of the see-through mobile viewer we launched in FY2011, and also of the label printers we launched in overseas markets.
In high-temperature polysilicon TFT panels, we forecast increased sales to external manufacturers, and also for electronic viewfinders used in digital cameras.


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Devices and precision products

Q

On April 10, Epson announced it was starting negotiations about the transfer of its optical products business. Has this been reflected in the FY2012 forecast?


Q

This transfer is still being negotiated, and has therefore not been included in our FY2012 outlook. In any case, the impact of optical products on the overall business is minimal.


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