Financial Results Briefingfor the Second Quarter of the Fiscal Year ending March 2013
Approaches Taken under the Mid-term Management Plan （2012→2014）
Copyright ©2012 Nihon Unisys, Ltd. All rights reserved.
Nihon Unisys, Ltd.Representative Director, President & CEOShigeru Kurokawa
November 1, 2012
FY 2013 FY 2014FY 2012
▲Business Environment for the Mid-term Management Plan （2012→2014）
Although the mid-term trends have not changed since the Plan was made,there has been a significant slowdown for the immediate future
Forecast of Domestic IT Market
(Billion Yen)(Trillion Yen)
Forecast of Domestic Tablet Market
CAGR ＋１．１％
CAGR ±０．０％
CAGR ＋４６．２％
024
68
10
12
Hardware & Software for September 2011
IT Services for September 2011
Hardware & Software for September 2012
IT Services for September 2012
200
400
600
September 2012 September 2011
CY
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Source： “Gartner Market Databook, 3Q12” 27-Sep-2012“Gartner Market Databook, 3Q11 Update” 23-Sep-2011
The graph above was prepared by Nihon Unisys, Ltd. on the basis of these Gartner data.‘Hardware & Software for September 2012’ represents the total of anticipated market size of devices, datacenter systems, and software.‘Hardware & Software for September 2011’ represents the total of actual market size of computing hardware, software and telecom equipment.CAGR has been calculated for the period from 2011 through 2014.
0
Source： Gartner “Forecast: Tablets and Ultra mobiles, Worldwide, 2010-2016, 3Q12 Update” 17-Sep-2012Gartner “Forecast: Media Tablets by Operating System, Worldwide, 2010-2015, 3Q11 Update” 16-Sep-2011
The graph above was prepared by Nihon Unisys, Ltd. on the basis of these Gartner data.CAGR has been calculated for the period from 2011 through 2014.
Slowdown＋７．１％
2008 2009 2010 2011 2012 2013 2014 20152010 2011 2012 2013 2014 2015 2016
-10
-5
0
5
10
FY2011 1H FY2011 2H FY2012 1H FY2012 2H
（％）
March 2012 Survey June 2012 Survey September 2012 Survey
-１．２％
Annual Projections pertaining to Companies’ Software Investment (yr/yr)
CY
Note: The expression “FY/ fiscal year” utilized in this document indicates the fiscal year which finishes at the end of March of the following year.(Example: The expression FY2012 refers to the fiscal year ending March 2013.)
Source: Bank of Japan Explanation of the Short-Term Economic Survey of Enterprises in Japan (Tankan)
＊All enterprises and all industries(including financial institutions)
FY 2013 FY 2014FY 2012
▲
Taking on the Challenge ofNew Businesses
Aiming to stabilize the base of our earnings in 3 years through the expansion of ourCore Businesses*, and also enhance our businesses through new opportunities
Basic Policies for the Mid-term Management Plan （2012→2014）
Partner capable of providing added values to customers
by leveraging ICT
Entrance inthe Social Infrastructure Businesses
No. 1 partner capable of achieving the optimization of ICT
Partner capable of contributing to the provision of social infrastructures
by utilizing ICT
Establishment of Co-creation/BPO Business Models
Expansion of Core Businesses
Market expansion
Opportunities for growth
Copyright ©2012 Nihon Unisys, Ltd. All rights reserved.
Cooperation with DNP
Expansion of Core Businesses
Reinforcement ofManagement Base
2
Solution business
Cooperation in marketing/sales
Cloud business
Reinforcement of Management BaseReform of Personnel System/
Workforce Optimization Strengthening of Technological Skills Cost Structural Reform
* The existing business domains such as system & network integration, and operation/maintenance services
Risk ManagementEnhancement of Financial Standing
Reinforcement of service chainStrengthening of solution servicesEnhancement of infrastructure servicesEnhancement of services for operation and maintenanceReinforcement of the support to customers for theiroverseas expansion
Expansion of Core BusinessesCooperation with DNP
FY 2013 FY 2014FY 2012
▲
Recognition of urgently required strengthening of the group-wide arrangement of service chains, after making efforts towards an expansion of our Core Businesses
[A] Deployment with a focus on CoreCenter® A significant decrease in delivery period and achievement of quality improvement Diversification of this series of services from retail to other business categories
⇒ Reuse of knowledge for other solutions
[C] Further efforts made in order to strengthen the arrangements for the businesses related to infrastructure, without being complacent of an increase in net sales
Strengthening of Solution Services
Strengthening of Infrastructure Services
Expansion of Core Businesses
Key Strategies forthe “Expansion of Core Businesses”
Shift from template-type services to introduction-type services（Shift to the introduction-type services where customization is minimized）
Diversifying and improving the product line through alliances
Reinforcement of Service Chain
Re-alignment of functions assigned to group companies
Reform of the flow of business process
Strengthening of upstream consulting business for customers from the viewpoint of entire ICT lifecycle and from mid-/long-term viewpoints
Strengthening of Solution Services
Approaches Taken under the Mid-term Management Plan （2012→2014）①
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without being complacent of an increase in net sales Steady implementation of large-scale infrastructure renewal projects
(a 9% increase in infrastructure-related projects*) Increase in businesses for telecommunications carriers
(a 12% increase in UNIADEX business)
⇒ Group-wide strengthening of the workforce related to these infrastructure businesses and cooperation therein
Strengthening of Operation/Maintenance Services
[C] An increase in the net sales of outsourcing business, in contrast to the slow recovery of support services
Cutover of large-scale housing projects (a 5% increase in net sales of outsourcing business)
Enhancement of data center in order to prepare for an increase in demand (Establishment of Obama DC for U-Cloud®)
⇒ Increase in sales of integrated SMS (high-value added services of operation/maintenance) within the short term
* Total of projects pertaining to Support Services, Outsourcing, Netmarks Services, Software, and Hardware
Reform of the flow of business process
Reinforcement/integration of arrangements for making proposals regarding infrastructure
• Reinforcement of arrangements for sales/maintenance of infrastructure-related products
• Acceleration of virtualization/automation businesses of solutions
• Acceleration of businesses of making proposals and redesigning for the migration to multi-vendor cloud-computing and hybrid type systems
Change from an SI-centered discrete services to comprehensive services that include operation/maintenance services
Laborsaving and streamlining of the outsourcing scheme that deals with individual customers
Reinforcement of Supports toCustomers for their Overseas Expansion
Promoting the globalization for the proven solutions (created by our group/other companies)
Strengthening our arrangements for globally delivering our services
Development of personnel suitable for global ICT businesses
Enhancement of Services for Operation/MaintenanceEnhancement of Infrastructure Services
[A] : Excellent [B] : Good [C] : Satisfactory
FY 2013 FY 2014FY 2012
▲Approaches Taken under the Mid-term Management Plan （2012→2014）②
[C] <Co-Creation/BPO> Limited business contribution, despite a gradual increase in cases and actual performance
New entrance into a digital contents service business in cooperation with DNP
[C] <Social Infrastructure>Launch of discrete businesses Towards an domain expansion of social infrastructure business⇒Deployment towards a comprehensive EMS（Energy Management Systems）
[BEMS(Building EMS), smartoasis®（a service based on charging infrastructure system）]
Promotion of New Businesses
Promotion of New BusinessesReinforcement of Management Base
Towards further expansion of business domains without being complacent of smooth launches of discrete businessesManagement base being steadily reinforced through efforts such as workforce optimization and a reform of cost structure
Key Strategies for the “Promotion of New Businesses”
Reinforcement of planning capabilities forco-creation businesses
Strengthening of technological skills for designingsocial infrastructure, and alliances in this regard
Establishment of Co-creation Business/BPO Models
Entrance in the Businesses of Social Infrastructure
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[A] Steady progress being made towards a personnel system reform andworkforce optimization
* This number excludes the employees of USOL Vietnam and the employees retiring at the term end
Key Strategies for the “Reinforcement of Management Base”
Reinforcement of Management Base
[B] Continued implementation ofcost reduction measures
Promotion of elimination and consolidation of offices of the group companies ( A ¥1.6 billion decrease is planned for FY2014, in comparison to FY2011.)Cost structural reform
・Reduction of fixed costs(Towards a 15% reduction of total cost
in comparison to FY2010)
Workforce optimization・Reduction of employee number from 9,300 to 8,000
in conjunction with a reform of business structure
・Efforts to reinvent and tighten our personnel system
・ Promotion of programs for personnel development - Implementation of career design
(people)
FY
Number of Employees（on a consolidated basis）
Transfer of employees
Revision of employment
extension system
2011 2011 2012 2014
Direct workforce Transfer of 46 employees during 1H
9350 9157 90818000*
Indirect workforce 16%
Strategies for Personnel Matters and Human Resources
Cost Structural Reform
Reassignment of indirect workforce to the positions of providing operation/maintenance, after training (150 transfers are planned on a full year basis.)
Release of a new personnel system in the next fiscal year after the finish of design (in Q2)Implementation of a career design scheme in Q4
End of 2011 1H
End of2011
End of 2012 1H
2014Plan
FY 2013 FY 2014FY 2012
▲
Reinforcement of Management Base (Risk Management)
Enhancement of Risk Management
Thorough identification of business risks in the project discovery phase, leading to the implementation of the evaluation of those risks from multiple aspects,
early detection and countermeasures
[B] Restructuring of an implementation process when applying solution
⇒ Early detection of business risks in the upper stream phase (where projects are discovered)
[B] Strengthening of quality confirmation during the development phasethat started in 1H
・・・ ①
・・・ ②
・・・ ③ Towards the implementation of the efforts concerned
through Business Review Committee (new committee) that have been
Implementation of technical review and technical assessment by Quality Management & Assurance
Approaches Taken under the Mid-term Management Plan （2012→2014）③
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⇒ Strengthening of detecting project risk
Project discovery Proposal Order Requirement
Definition Development Acceptance Inspection
OperationMaintenance
Business Review Committee (new committee)
(monthly/quarterly) business appraisal/monitoring
Andon System
①, ②
③
④
・・・ ③
・・・ ④
through Business Review Committee (new committee)
Identification of general business risks followed by group-wide efforts of implementing countermeasures
that have been implemented since Q3
FY 2013 FY 2014FY 2012
▲
6-7%
Towards the Achievement of the Mid-term Management Plan
(Billion Yen)Net Sales and Operating Margin
280.0
At the same time as prioritization of the achievement of the plan for this period,steady and prompt delivery of measures for a mid- and long-term growth.
300.0Steady Expansion of
Core Businesses
265.0 270.0
Expansion ofNew Businesses (including the businesses
through cooperation
Copyright ©2012 Nihon Unisys, Ltd. All rights reserved.
2.6% 2.9% 3.4%4.4% 5.0%
2010 2011 2012 2013 2014Plan Plan Plan
FYTo Be Achieved Soon
6
253.0 255.1
Cost Structural Reform
265.0 through cooperationwith DNP)
FY 2013 FY 2014FY 2012
▲
Copyright ©2012 Nihon Unisys, Ltd. All rights reserved.
Note:Forecasts in this document rely on judgments and assumptions based on information available at present, and are subject to changes in risks, uncertainties, economy and other factors that could cause actual results to be different from expectations. Thus, the certainty of these forecasts is not guaranteed by our Group.Also, the information is subject to change without prior notice in future.Information in this document is intended to provide further understanding of Nihon Unisys, Ltd., and is not intended to solicit investment.This Company shall not be held responsible for any damages whatsoever incurred as a result of utilizing the information provided in this document.
