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Biological microscopes, industrial microscopes, stereoscopic microscopes, measuring instruments, semiconductor inspection equipment
Net Sales
Operating Income
The bioscience field is expected to hold steady, with business focused mainly on live cell businesses in Japan and Asia. In the industrial instruments field we anticipate an upturn in market conditions centered on Taiwan, South Korea and China amid signs of a remarkable recovery in the electronic components industry.
Global Market of Biological Microscopes
Source: Nikon's estimate based on the various market data
Global Market of Measuring Instruments
| * | Measuring instruments include profile projectors, measuring microscopes and CNC video measuring systems. |
Toshiyuki Masai
Director, Member of the Board & Executive Officer, President of Instruments Company
| Q1: | What were the business results and principal activities in the Instruments Company during the fiscal year ended March 2010? |
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| A1: | Sales in the bioscience field recorded steady growth during the fiscal year ended March 2010, particularly in Japan and Asia, although conditions remained severe in the industrial instruments field due to weakness in the overall market. As a result, segment sales rose a slight 0.9% from the previous fiscal year to ¥45,051 million, but the operating loss increased to ¥9,331 million compared with ¥2,724 million in the previous fiscal year because of one-off expenses related to the conversion of measuring instruments business affiliates into consolidated subsidiaries.
Sales in the bioscience field, which specializes in biological microscopes, grew by more than 10% year on year, primarily because of continued demand for products in areas working with live cells. Sales of the confocal microscope A1 and the inverted research microscope ECLIPSE Ti were especially healthy. In contrast, the business environment for industrial instruments was extremely severe as weakness in the overall economy forced many companies to scale back their capital expenditure. However, some signs of recovery appeared during the second half of the year, mainly in the Asian market, and sales improved in comparison with the same period in the previous year. The recovery in demand was particularly strong in the field of electronic components. Moreover, as part of our strategy to broaden our business domain, the Instruments Company completed a friendly takeover of the Belgian measuring equipment manufacturer Metris NV (currently Nikon Metrology NV), which became a wholly owned consolidated subsidiary in October 2009. This company owns proprietary technologies in the field of non-contact, three-dimensional measurement systems and produces products for a wide range of industries, so this move is expected to generate powerful synergies with the Instruments Company both in terms of marketing and technology. |
| Q2: | What are the features of Nikon's new super resolution microscopes, and your plans for existing products in the bioscience field? |
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| A2: | The bioscience market depends primarily on publicly funded projects undertaken by universities and research institutes. The annual budgets for such projects are determined well ahead of time, and as a result this sector is not subject to sharp fluctuations in demand. Future demand is expected to remain relatively stable, and we forecast especially solid growth in sales of cutting-edge research equipment.
In the fiscal year ending March 2011, the Instruments Company will introduce two new super resolution microscopes with resolutions far superior to that of conventional optical microscopes, which have a resolution limit of 200 nm. One of these new microscopes, N-SIM, will have a resolution nearly twice as high as the conventional optical microscopes (approx. 100 nm), and will be capable of continuous imaging at a maximum speed of 0.6 sec/frame. This microscope will make it possible to clearly observe the microstructure of live cells. The other new product, N-STORM, boasts a resolution more than 10 times greater than conventional optical microscopes (approx. 20 nm) and will be capable of high-resolution, three-dimensional fluorescence imaging. It will facilitate observation of biological specimens at the molecular level. We developed these two products under license from the University of California, San Francisco, and Harvard University, respectively. With regard to our existing line of research, clinical and educational microscopes, it is important that we expand our user base and solidify our position in the market. To do this, the Instruments Company's strategy will be to improve product functionality even among product series that have already achieved a superior reputation among users in these various fields, while at the same time intensifying our sales and marketing efforts. In addition to hardware, it is essential that we develop software that meets the individual needs of our various users. Our goal will be to increase the value of the Nikon brand by adopting a total approach that includes upgraded software and improved customer support services. |
| Q3: | What are your strategies to expand market share in the industrial instruments field? |
| A3: | In the industrial instruments field, the market for displays and electronic components is improving, especially in Asia, and the demand for measuring instruments and industrial microscopes is recovering rapidly. This trend is expected to accelerate further as we approach the fiscal year ending March 2012, and we are taking steps accordingly to intensify our sales and marketing activities in these areas. In the automotive market, demand is projected to recover gradually, primarily in Asia. Meanwhile, in developed countries new demand is emerging for advanced measurement systems designed to improve productivity. Going forward Nikon will focus on development of products to meet the needs of the Asian market, while also seeking to expand its business in developed countries by helping customers to improve their manufacturing processes.
The measuring instruments market is experiencing increased demand for non-contact measuring devices. By converting Metris NV (currently Nikon Metrology NV) into a wholly owned subsidiary, Nikon has acquired advanced technology in the high-growth field of non-contact measurement systems, and has enriched the range of products it has available to serve the measurement needs of companies in a variety of industries. Moreover, by merging these non-contact measurement technologies with Nikon's current optical and high-precision measurement technologies, we will be able to promote development of high-value-added measuring instruments that will enable us to expand our customer base and increase sales. |
| Q4: | What measures are you implementing to improve earnings, and your outlook for restoring profitability? |
| A4: | In the bioscience field, demand for biological microscopes is expected to remain healthy in the fiscal year ending March 2011, particularly in fields related to live-cell imaging. Nikon aims to boost sales and market share by focusing especially on high-end products, such as super resolution microscopes and systems, where growth in demand is expected to be especially strong. In the industrial instruments field, we are intensifying our sales promotion activities in Japan and in Asian countries where markets are beginning to recover, such as Taiwan, South Korea and China. We forecast that earnings will start to improve during the second half of the fiscal year ending March 2011, and that we will return to profitability in the fiscal year ending March 2012.
The Instruments Company supplies a large number of products that are essential to both manufacturing and research in fields such as medicine, bioscience, and many other industries, and as a result we see many opportunities for business expansion. We will continue to strive to increase the corporate value of the Instruments Company by listening to the views of a wide range of customers, and by supplying products that contribute significantly to both manufacturing and research. |
