Outline of Consolidated Financial Results for Fiscal 2010
Mayy 11, 2011

Hitachi, Ltd.

Outline of Consolidated Financial Results for Fiscal 2010
May 11, 2011

Contents
1. Outline of Consolidated Financial
Results for Fiscal 2010
2. Overview by Business Segment

Copyright © 2011,2010, Hitachi, Ltd., All rights reserved.

2

Outline of Consolidated Financial Results for Fiscal 2010
May 11, 2011

Contents
1. Outline of Consolidated Financial
Results for Fiscal 2010
2. Overview by Business Segment

Copyright © 2011,2010, Hitachi, Ltd., All rights reserved.

3

1-1. Financial Results Highlights
Highlights of Fiscal 2010 Results
Revenues rose 4% YoY
Revenues- The
Th increaseireflected
fl t d recovering
i ddemandd iin ththe automotivettiandd electronicsl t i
related fields, and came despite the impact of the Great East Japan
Earthquake.

Operating income rose 242.3
242 3 billion yen YoY
Operating income

Net other income(deductions)
Net income (loss)
attributable to
Hitachi Ltd
Hitachi,Ltd.
Free cash flows- Exceeded 400.0 billion yen for the first time since fiscal 1990.
- Attributable to progress with business structure reforms, reduced materials
procurement costs, better project management, etc.

Net other deductions improved 126.2 billion yen YoY- Gains on the sale of marketable securities improved due to gains on thetransfer of management rights related to IPS Alpha Technology.
- Improvement in equity in net earnings of affiliated companies.

Improved 345.8 billion yen YoY- The bottom-line result was a record.

Free cash flows was a positive 581.2 billion yen(313.5 billion yen YoY increase)- 336.6
336 6 billi
billion yen iimpactt associatedi t d withith consolidating
lid ti securitized
iti d entities
titi iin
accordance with the application of new accounting guidances.
Copyright © 2011, Hitachi, Ltd., All rights reserved.

4

1-2. Consolidated Statements of Operations
Billions of yen
Previous
forecast
Comparison*

Fiscal 2009

Fiscal 2010

Year-over-year

8,968.5

9,315.8

347.2[104%]

15.8[100%]O
Operatingti income
i

202 1
202.1

444 5
444.5

242 3
242.3

45
4.5

Net other income (deductions)(138.5)(12.3)

126.2

(2.3)

Income before income taxes

63.5

432.2

368.6

2.2

I
Income
taxes
t

147 9
147.9

129 0
129.0

(18 8)(18.8)

(4 0)
(4.0)

Net Income (loss)(84.3)

303.1

387.5

(1.8)

Net income attributable
to noncontrolling interests

22.5

64.2

41.6

(10.7)(106.9)

238.8

345.8

8.8

Revenues

Net income (loss) attributable to
Hitachi, Ltd.

* previous forecast announced on February 3, 2011
Copyright © 2011, Hitachi, Ltd., All rights reserved.

51-3. Impacts of the Great East Japan Earthquake

Revenues

Operating loss

Other deductions
Net loss
attributable toHit hi Ltd
Hitachi,Ltd.

Status of Recovery(130.0) billion yen
Lower shipments in line with capacity utilization drop, andcustomer delays inspecting products
products.

(75.0) billion yen
Damage, write-down, repairs, inspection andremovall off inventory,
i
t
and
dd
deliveryliddelays,l
etc.
t(25.0) bllion yen
Damage to and impairment of fixed assets, impact on equitymethod affiliates, etc.

(75.0) billion yen
9Many business sites, particularly in the Tohoku region and
Ibaraki Prefecture,, were affected
9Realized an extraordinary fast recovery due to Group-wide
efforts
9Operations resumed at the end of March, 2011, and mostfacilities returned to full production after mid-April.
mid April

Copyright © 2011, Hitachi, Ltd., All rights reserved.

6

1-4. Major Factors for Change in Operating Income (Year-over-Year)
Billions of yen

Impact of
the natural
disaster :(75.0)

Operating income

444.5

Lower sales
prices :(180.0)Effect offoreign exchange
movements :(65.0)

202 1
202.1

Fiscal 2009

Fiscal 2010

Cost cutting,etc. :122.4

Improved capacity
utilization :210.0
Material procurementg:cost cutting
230.0
Copyright © 2011, Hitachi, Ltd., All rights reserved.

71-5. Major Factors for Change in Net Income Attributable to Hitachi, Ltd.
Billi
Billions
off yenOperatingincome

当社に帰属するNet
income
当期純利益
attributableto→
Hitachi, Ltd.

Losses on disposal of fixed asset,
gains on securities, etc.* :
49.7

444.5
EquityE
it in
i nett llossof affiliatedcompanies* :
(4.1)

238.8

Structuralreform-related
expenses* :(32.8)

Impact of
the natural disaster(Other deductions) :(25.0)

Fiscal 2010

Operatingi
incomeNet income
Attributable to
Hitachi, Ltd.

Income taxes :(129.0)Net income attributable
to noncontrolling interests :(64.2)* The impact of the natural disaster is not included in figures for losses on disposal of
fixed-asset, gains on securities, etc., and equity in net loss of affiliated companies, andstructural reform-related expenses.
Copyright © 2011, Hitachi, Ltd., All rights reserved.

8

1-6. Major Factors for Change in Net Income (Loss) Attributable to Hitachi, Ltd.
(Year-over-Year)Net income attributable tononcontrolling interests :(41.6)

Billions of yen
Net income (loss) attributable
to Hitachi, Ltd.

238.8
Decreasing structuralreform-related
expenses* :17.4

Decreasing ofincome taxes :18.8

Improved equity in net lossof affiliated companies* :54.0
Impactpof the natural disaster : ((100.0))
Operating loss : (75.0)
Losses on disposal of
Other deductions : (25.0)
fixed assets, gain (loss) on
securities, etc.* :79.8
Improved operating income* :317.3(106.9)Fiscal 2009 Fiscal 2010

* The impact of the natural disaster is not included in figures for improved operating
income, losses on disposal of fixed-asset, gain (loss) on securities, etc., and improved
equity in net loss of affiliated companies, and decreasing structural reform-related
expenses.
Copyright © 2011, Hitachi, Ltd., All rights reserved. 9

1-7. Revenues by Market
Billions of yen

Fiscal 2009

Ratio

Fiscal 2010

Ratio

Year-over-yearJapan

5,313.7

59%

5,269.2

57%

99%

Outside Japan

3 654 73,654.7

41%

4 046 5
4,046.5

43%

111%

1,699.019%

2,073.7

22%

122%

Chi
China

991 6
991.6

11%

1 188 5
1,188.5

13%

120%

North America

729.6

8%

781.1

8%

107%

Europe

824.6

9%

760.0

8%

92%

Other Areas

401.2

5%

431.6

5%

108%

8,968.5100%

9,315.8

100%

104%

Asia

Total

Ratio of overseas revenues 41 % Æ 43 %Copyright © 2011, Hitachi, Ltd., All rights reserved. 10

1-8. Consolidated Balance Sheets
Billions of yen
As of March 31,
2010*

As of March 31,
2011

Total assets

8,964.4

9,185.6

221.1

Total liabilities

6,696.6

6,744.2

47.6

Interest-bearing debt

2,367.1

2,521.5

154.4

Total Hitachi, Ltd.
stockholders’ equity
stockholders

1,284.6

1,439.8

155.2

Noncontrolling interests

983.1

1,001.5

18.3

Total Hitachi, Ltd.
stockholders’ equity ratio

14 3%
14.3%

15 7%
15.7%

1.4 points
Improvement

1.38 times

1.03 times

0.35 points
improvement

1.04 times

0.86 times

0.18 points
improvement

D/E ratio(Including noncontrolling interests) *1

D/E ratio(Including noncontrolling interests) *2

Change fromMarch 31, 2010

* Figuresgas of March 31,, 2010 have been adjustedjto the final figuresgin accordance with the pprovisions of the Accounting
g Standards Codification ((ASC))No. 805, “Business Combinations,” because the fair value valuation concerning business combinations conducted in the fiscal year ended March 31,
2010 was concluded in the first quarter of the fiscal year ended March 31, 2011.
*1 : Including liabilities associated with the consolidation of securitized entities.
*2 : Excluding liabilities associated with the consolidation of securitized entities.

Copyright © 2011, Hitachi, Ltd., All rights reserved. 11

1-9. Consolidated Statements of Cash Flows
Billions of yen
As of March 31,
2010

As of March 31,
2011

Change fromMarch 31,, 2010

Cash flows
from operating activities

798.2

841.5

43.2

Cash flows
from investing activities(530.5)(260.3)

270.2

267.7

581.2

313.5

(502.3)(584.1)(81.8)

336.6-

Free cash flows
Cash flows
from financing activities
Effect of consolidation of securitizedentities upon previous adoption of new
accounting guidances-

Copyright © 2011, Hitachi, Ltd., All rights reserved. 12

1-10. Summary Financial Statements

by “Manufacturing, Services and Others” and “Financial Services”

Summary Consolidated Balance Sheets

Billions of yen
Manufacturing,Services and Others＊

Financial Services＊

Total assets

7,677.7

1,937.6

9,185.6

Total liabilities

5,467.4

1,695.5

6,744.2

Interest-bearing debt

1,513.6

1,220.3

2,521.5

Total Hitachi,
Hitachi Ltd
Ltd. stockholders’
stockholders equity

1 308 91,308.9

142 8
142.8

1 439 81,439.8

Noncontrolling interests

901.3

99.1

1,001.5

Total Hitachi, Ltd. stockholders’ equity ratio

17.0%

7.4%

15.7%

D/E ratio

0.68 times

5.04 times

1.03 times

D/E ratio

0.67 times

3.44 times

0.86 times(Including noncontrolling interests) *1(Including noncontrolling interests) *2

Summary Consolidated Statements of Cash Flows

Total

Billions of yen

Manufacturing,Services and Others*

Financial Services*C
Cashfflows fromfoperating activities

6 1
671.5

190 9
190.9

8 1
841.5

Cash flows from operating activities(399.9)126.9(260.3)

Free cash flows

271.5

317.9

581.2

Cash flows from financing activities(255.3)(434.2)(584.1)

Total* Figures are before offsets and eliminations related to transactions between Manufacturing, Services and Others, and Financial Services.
*1 : Including liabilities associated with the consolidation of securitized entities.
*2 : Excluding liabilities associated with the consolidation of securitized entities.

Copyright © 2011, Hitachi, Ltd., All rights reserved. 13

1-11. Consolidated Capital Investment, Consolidated R&D Expenditure(1) Consolidated capital investment

Billions of yen

Fiscalsca 2009
009

Fiscalsca 2010
0 0Year-over-yearyConsolidated capital investment

546.3

556.8

102%

Internal use assets

247.4

273.1

110%

Leasing assets

298.9

283.7

95%

(2) Consolidated R&D expenditureBillions of yen

Fiscal 2009

Fiscal 2010

Year-over-year

Consolidated R&D expenditures

372.4

395.1

106%

P
Percentaget
off revenues

4.2%

4.2%

-

Copyright © 2011, Hitachi, Ltd., All rights reserved. 14

1-12. Revenues by Business Segment
Billions of yen
Fiscal 2009

Information & Telecommunication
Systems

Fiscal 2010

Year-over-year

Previous forecast
Comparison*

1,705.5

1,652.0

97%

95%

882.1

813.2

92%

97%

1,250.2

1,156.9

93%

99%

Electronic Systems & Equipment

998.6

1,079.3

108%99%

Construction Machinery

583.6

751.3

129%

104%

1,249.3

1,408.1

113%

101%

Automotive Systems

638.8

737.9

116%

100%

Components & Devices

754 8
754.8

809 8
809.8

107%

100%

Digital Media & Consumer Products

929.2

951.5

102%

100%

Financial Services

419.6

372.9

89%

107%

Others

763.6

767.4

100%

101%

(1,207.2)(1,185.0)-

8,968.5

9,315.8

104%

Power Systems
Social Infrastructure & Industrial Systems

High Functional Materials & Components

Eliminations & Corporate Items
Total

100%

* previous forecast announced on February 3, 2011
Copyright © 2011, Hitachi, Ltd., All rights reserved. 15

1-13. Operating Income (Loss) by Business Segment
Billions of yen
Fiscal 2009

Fiscal 2010

Year-over-year

Previous forecast
Comparison＊

Information & Telecommunication
S t
Systems

94 5
94.5

98 6
98.6

40
4.0

(1 3)
(1.3)

Power Systems

22.0

22.0

0

(6.9)

Social Infrastructure & Industrial Systems

42.0

39.9

((2.1))((8.0))

Electronic Systems & Equipment

(5.2)

37.2

42.5

(2.7)

Construction Machinery

17.6

49.1

31.5

5.1

High Functional Materials & Components

44.4

84.5

40.0

(0.4)

Automotive Systems

(5.4)

23.7

29.2

1.7

Components & Devices

11
1.1

43 6
43.6

42 5
42.5

(2 3)
(2.3)

(7.2)

14.9

22.1

0

Financial Services

8.5

14.2

5.7

( )
(6.7)

Others

19.4

28.9

9.5

5.9

Eliminations & Corporate Items(29.8)(12.6)

17.1

20.3

Total

202.1

444.5

242.3

4.5

Digital Media & Consumer Products* previous forecast announced on February 3, 2011

Copyright © 2011, Hitachi, Ltd., All rights reserved. 16

1-14. Main Initiatives for Creating a High Profit Structure in Fiscal 2010
Main Initiatives

Fixed cost cuttingMaterial procurement
cost cutting

zReduced indirect material costs
Cost reductions of approximately 35.0 billion yen exceeded target.
Rolled out the “Indirect
Indirect Material Cost Reduction Project”
Project across the Group.
Group
zReduced material costs
Æ Despite an approximate 27.0 billion yen jump in materials costs,
cost reductions
red ctions of approximately
appro imatel 230.0
230 0 billion yen
en exceeded
e ceeded target.
targetzExpand global procurement, procurement from emerging countriesÆ 36% reduction exceeded target.
Reinforcing procurement functions in Brazil, Vietnam, India, etc.
zPromote centralized purchasingÆ 28% reduction exceeded target.

Realize speediermanagementzAccelerate management decision-making and rigorously promoted
autonomous management through full deployment of in-house company
systemzExpand each company’s discretion to make decisions through internalrating system
zReinforce Group IT systems to enhance management infrastructure

Expansion of Social Innovation BusinessAccelerate global development

Use of M&As
Copyright © 2011, Hitachi, Ltd., All rights reserved. 17

1-15. Fiscal 2011 Outlook
Economic environmentJ
Japan

Lower economic growth expected in the first half of fiscal 2011 due to the direct
impact of the natural disasterdisaster, as well as resulting constraints on components andmaterials supply chains, power supply shortages, etc. However, growth is expected
to pick-up in the second half due to demand related to Japan’s recovery efforts.

U.S.

Gradual recovery likely to continue, despite concerns about a self-sustainable
recovery caused by slow pick
pick-up
up in the job market
market, etc
etc.

EuropeFirm export growth is expected due to the weak euro, although there are concerns
about the sovereign debt crisis deepening.

China

Monetary tightening to combat inflationary pressures, including soaring grain andresource prices and rising wages, is a concern for economic growth. However, internal
demand is set to continue expanding, in part because of the government’s new 5-year
plan.

Hitachi’s initiatives
Forcefully promote measures to counter changes in the operating environment

Japan・ Play an instrumental role in helping restore social infrastructure.
・ Build a production framework that addresses concerns about supply chain
constraints and electricity supply stability.

Global・ Step up efforts based on regional strategies to promote the Social Innovation
Business.
Copyright © 2011, Hitachi, Ltd., All rights reserved. 18

Outline of Consolidated Financial Results for Fiscal 2010
May 11, 2011

Contents
1. Outline of Consolidated Financial
Results for Fiscal 2010
2. Overview by Business Segment

Copyright © 2010,2011, Hitachi, Ltd., All rights reserved. 19

2-1. Information & Telecommunication Systems
Revenues
20,000
20
2 000
2,000

Billions of yen

1,705.5

1,652.0

15,000
1,500
1 000
1,000
10,00010

Fiscal 2010 (Full-Year Results)
Revenues declined reflecting impact of constrained ITin estment in Japan
investment
Japan, altho
althoughgh storage sol
solutionstions sasaw
sales growth overseas.
Operating income rose due to better project
managementgand cost cutting,g, etc.

5,000
500
0

FY2009Operating income

FY2010Billions of yen

1,500
150
1,000
1
000
100

94.5

98.6

FY2009FY2010Fiscal 2011 Outlook
Expect to find it difficult to win orders in the first halfbecause of the natural disaster’s impact. However, agradual recovery is expected due to faster developmentof overseas markets
markets, particularly in the storage
solutions business, and efforts in the second half tocapture demand targeting improved BCP (business
continuity plan).

500
50
0

Copyright © 2011, Hitachi, Ltd., All rights reserved. 20

2-2. Power Systems
Revenues

Fiscal 2010 (Full-Year Results)
Billions of yen

10,000
10
1 000
1,000

882.1

813.2

7,500
750
5,000
5
000
500
2,500
250

Revenues declined due to delays with thermal power
generation projects,
projects lo
lower
er sales of prepreventative
entati emaintenance services for nuclear power generation
systems, and the natural disaster’s impact.
Despitep the lower revenues,, operatingpg income was on apar with fiscal 2009 due to better project management,
cost cutting, etc.

0
FY2009FY2010Operating income
Billions of yen

300
30
22.0

22.0

FY2009FY2010200
20

Fiscal 2011 Outlook
First-quarter revenues are expected to decline becauseof the natural disaster. However, Hitachi aims toachieve the same revenues as in fiscal 2010 throughinitiatives to ensure power supply stability, and byaccelerating global development from the second
quartert onwards.
d

100
10
0
Copyright © 2011, Hitachi, Ltd., All rights reserved. 21

2-3. Social Infrastructure & Industrial Systems
Fiscal 2010 (Full-Year Results)

Revenues
15
15,000
1 500
1,500
000

Billions of yen

1,250.2

1,156.9

1,000
10,000

Revenues dropped due to the natural disaster’s impact, etc.
However, elevator and escalator sales grew strongly in China.
Operating income decreased despite progress with cost cutting
cutting.
The decline reflected the lower revenues and natural disaster’s
impact.

Fiscal 2011 Outlook■Social Infrastructure and Industrial Systems

5,000
500

Social Infrastructure and Industrial Systems Company +Hitachi Plant Technologies, Ltd. + Hitachi Industrial Equipment Systems Co., Ltd.

0
FY2009Operating income
500
50

42.0

FY2010

Revenues are forecast to rise yyear over yearydespitep the impact
pof supply chain constraints. This forecast is based on efforts to
help with Japan’s recovery, further acceleration of global
development and other measures.

Billions of yen■T■Transportationt ti Systems
S t

300
30

Revenues are expected to fall year over year, due to the impact
of supply chain constraints caused by the natural disaster.
However, the company will promote global development in this
area.

20
200

■ Urban Planning and Development Systems

40
400

39.9

10
100
0
FY2009FY2010

Revenues are expected to be on a par with fiscal 2010 for thefull year.
year While the natural disaster’s
disaster s impact will see lower salesin Japan, the overseas elevator and escalator business is
expected to expand further.
Copyright © 2011, Hitachi, Ltd., All rights reserved. 22

2-4. Electronic Systems & Equipment
Fiscal 2010 (Full-Year Results)

Revenues
10,000
10
1 000
1,000

Billions of yen

998 6
998.6

1,079.3

8,000
800

Revenues rose despite the natural disaster’s impact. The main
reason was firm growth in semiconductor manufacturing
equipment etc
equipment,
etc.
The segment returned to profitability in terms of operating
income thanks to higher revenues and fixed cost cutting.

6,000
600
4,000
400

Fiscal 2011 Outlook

2,000
200

■Hitachi High-Technologies Corporation

0
FY2009Operating income (loss)

FY2010Billions of yen

37 2
37.2

First-quarter revenues are expected to drop due to the natural disaster’s
impact However
impact.
However, revenues are expected to grow year over year from thethird quarter onward due to a recovering operating environment.

■Hitachi Medical Corporation
Revenues are projected to rise year over year due to the acquisition of
Al k However,
Aloka.
Htheth naturalt l didisastert willill still
till constraint i supply
l chains,
h i
etc.
t

300
30

■Hitachi Kokusai Electric Inc.

200
20

Revenues are expected to rise 1% despite the natural disaster’s impact.
This forecast is based on successful efforts to capture demand related toJapan’s recovery, etc.

100
10■Hitachi Koki Co., Ltd.
Revenues are projected to grow 7% despite the natural disaster’s impact.
This forecast is based mainly on successful efforts to capture demand
related to Japan’s recovery, and expanding sales in emerging markets.

0
-100
(10)

(5.2)
FY2009FY2010
Copyright © 2011, Hitachi, Ltd., All rights reserved. 23

2-5. Construction Machinery
Revenues

Billions of yen

751.3
600
6,000

583.6

4,000
400

Fiscal 2010 (Full-Year Results)
Revenues rose due to firm growth centered on
emerging economies and the impact of making Indiancompany Telco Construction Equipment a consolidated
subsidiary.
Operatingpg income rose despite
p the natural disaster’s
impact due to higher revenues.

2,000
200

Fiscal 2011 Outlook

0
FY2009Operating income

FY2010Billions of yen

Revenues are expected to rise year over year on
projected robust demand centered on emerging
economies.

49.1

500
50
400
40
300
30
200
20

17.6

100
10
0
FY2009FY2010
Copyright © 2011, Hitachi, Ltd., All rights reserved. 24

2-6. High Functional Materials & Components
Fiscal 2010 (Full-Year Results)

Revenues
15,0001,500

Billions of yen

1 408 1
1,408.1
1,249.3

Revenues rose on the back of firm demand forautomobiles.
Operating income increased despite the natural
disaster’s impact due to the higher revenues.

10,000
1,000

Fiscal 2011 Outlook■Hitachi Metals, Ltd.

5,000
500
0
FY2009Operating income
1,000
100

FY2010Billions of yen

84.5

750
75
500
50

44.4

Although there are concerns about supply chain constraints,
particularlypy in the automotive-related sectors,, the company
p y
expects demand for social infrastructure- and energy-related
products.

■Hitachi Cable, Ltd.
Although there are concerns about power supplies and supply
chain constraints in the wake of the natural disaster, demand
particularly for industrial infrastructure-related products isrecovering, and special demand related to recovery efforts is
also expected.

■Hitachi Chemical Co., Ltd.

25
250

Demand is expected to recover for industrial batteries.
However, results will be impacted by supply chain constraints
and the suspension of operations at some production.

0
FY2009FY2010
Copyright © 2011, Hitachi, Ltd., All rights reserved. 25

2-7. Automotive Systems
Revenues

Billions of yen

737.9
6,000
600

638 8
638.8

4,000
400
2,000
200

Fiscal 2010 (Full-Year Results)
Despite the natural disaster’s impact, revenues rose
thanks to demand mainly
mainl in emerging markets and theboost from the Japanese government’s program to spursales of eco-vehicles.
Operatingpg income rose due to the benefits of businessstructure reforms and improved capacity utilization, etc.
Fiscal 2011 Outlook

0
FY2009Operating income (loss)

FY2010Billions of yen

23.7
200
20

The revenue outlook for the first half is unclear partly
because of uncertainty surrounding the productionplans of automakers with the impact of supply chainsconstraints.
However, a second-half recovery is expected.

100
10
0
(10)
△ 100

(5.4)
FY2009FY2010
Copyright © 2011, Hitachi, Ltd., All rights reserved. 26

2-8. Components & Devices (1)Revenues

Billions of yen

10,000
10
1 000
1,000
7,500
750

754.8

809.8

5,000
5
000
500

Fiscal 2010 (Full-Year Results)
Revenues increased due to firm growth in HDD
operations
operations.
Operating income increased due to higher HDD sales.
Fi
Fiscall 2011 Outlook
O tl k2,500
250
0FY2009Operating income
50500

FY2010Billions of yen

43.6

400
40

■Hitachi Displays, Ltd.
The lingering effects of the natural disaster are
expected to impact first-halffirst half performance.
performance However
However, arebound is expected in the second half due mainly tohigher consigned production resulting from buoyant
demand for small and medium-sized LCDs.
■Hitachi Global Storage Technologies
Refer to following page.

30
300
200
20
100
10
0

1.1
FY2009FY2010
Copyright © 2011, Hitachi, Ltd., All rights reserved. 27

2-8. Components & Devices (2) (Overview of Hard Disk Drive Business）
FY 2009

Operating
IncomeFY 2011

Total

Three months
ended June 30

(A)

(B)

(C)

(C)/(A)(D) (Preliminary)(D)/(B)Jan – Dec.2009

Jan – Mar. 2010

Jan – Dec.2010-

Jan – Mar. 2011-

Billions of yen

451.7

132.3

526.8

117%

115.4

87%

Millions of dollars

4,821

1,459

6,003

125%

1,402

96%

Billions of yen

9.2

19.7

57.2

621%

6.6

34%

Millions of dollars

106

217

645

606%

80

37%

Shipment PeriodR
Revenues

FY 2010Three months
ended June 30

Total

Fiscal 2010 (Full-Year Results)
Revenues rose due to strong growth in shipments of all products, including for notebook PCs.
Operating income rose on the higher revenues, an improved product mix, cost reductions,etc.
Fiscal 2011 Outlook
Despite concerns about the natural disaster’s ongoing impact on supply chains for certain
components, the company aims to quickly restore production levels by switching to alternative
components and taking other actions.
Copyright © 2011, Hitachi, Ltd., All rights reserved. 28

2-9. Digital Media & Consumer Products
Revenues

Fiscal 2010 (Full-Year Results)
Billions of yen

10,000
1000

929 2
929.2

951 5
951.5

FY2009FY2010

8,000
800
6,000
600
4,000
400
2,000
200
0

Operating income (loss)

Billions of yen

200
20
14.9

150
15

Fiscal 2011 Outlook■Hitachi Consumer Electronics Co., Ltd.
Despite concerns about the natural disaster’s ongoing impact
on supply chains, flat-panel TV demand is expected to pick up
ahead of the end of analog broadcasting in Japan and following
a downturn in demand in March 2011.

100
10
5
50
0

■Hitachi Appliances, Inc.
Despite concerns about the natural disaster’s
disaster s ongoing impact
on supply chains, firm growth is expected in emerging markets.

△ (5)
50
△ (10)
100

Revenues rose despite sluggish sales for optical disk
dri es The revenue
drives.
re en e gro
growthth reflected firm e
expansionpansion insales of products eligible for eco-points incentives inJapan.
Operatingpg income rose despite
p the natural disaster’s
impact. In addition to the benefits of business structurereforms in flat-panel TVs and other businesses, thehigher earnings resulted from a strong performancefrom air
air-conditioners.
conditioners(7.2)
FY2009FY2010
Copyright © 2011, Hitachi, Ltd., All rights reserved. 29

2-10. Financial Services / Others
Financial Services

Others

Revenues
4,000
400

Billions of yen

419 6
419.6

372.9

Revenues
8,000
800

3,000
300

6,000
600

2,000
2
000
200

4,000
4
000
400

1,000
100

2,000
200

0

FY2009FY2010Operating income

Billions of yen

0Billions of yen

763 6
763.6

767 4
767.4

FY2009FY2010Operating income

28 9
28.9

Billions of yen

200
20
14.2

150
15
100
10

200
20

19.4

8.5
100
10

505
0

0
FY2009FY2010FY2009FY2010
Copyright © 2011, Hitachi, Ltd., All rights reserved. 30

2-11. Initiatives for Expanding the Social Innovation Business (1)Leverage Hitachi’s strengths to promote a global growth strategy
Promote and expand global localization centered on the “Asian belt”
9IT consulting- Established new companies in China and India.

9Thermal power generation
systems- Established joint venture with BGR Energy Systems (India) .

9Water environment solutions - Agreed on cooperation in the water environment solutions business with
Xingrong Group (China) .
9Railway systems- Decided to build a new plant in China to supply electrical components forrolling stock.
stock

9Elevators and escalators- Established a Regional HQ in Singapore for Southeast Asia, India, and the
Middle East.

9 High functional materials &components- Hitachi Chemical established a powder metal product manufacturing basein Indonesia.
- Hitachi Cable decided to establish an industrial wire manufacturing facility in
China.

9Construction machinery- Hitachi Construction Machinery made Indian company Telco Construction
Equipment a subsidiary.

9Others- Reached an agreement to cooperate with Singapore Economic
Development Board.
Board- Strengthened corporate research divisions in China and India.
- Hitachi Research Institute established offices in China and India.
Copyright © 2011, Hitachi, Ltd., All rights reserved. 31

2-12. Initiatives for Expanding the Social Innovation Business (2)Leverage Hitachi’s strengths to promote a global growth strategy
Expand business opportunities through partnerships
9Data centers- Formed alliances with local companies in the UK and the Netherlands.

9IT consulting- Acquired Sierra Atlantic (U.S.) and Sociedad de Consultores Aptivo (Spain).

9SmartS
t cities
iti- PromotingP
ti concretet initiatives
i iti tiiin SiSino-Singapore
Si
TianjinTi ji E
Eco-CityCit (China).
(Chi )- Collaboration with Dalian City (China) in the field of recycling resources and low-carbon
economy.
- Participation in the construction of Guangzhou Knowledge City (China).
- Participation in Smart Community System Demonstration Project in Spain
Spain.
- Participation in demonstration project in the UK.

9Nuclear powers- GE-Hitachi Nuclear Energy’ s ESBWR*1 passed a critical safety review performed by NRC*2 .
- Participationpin International Nuclear Energy
gy Development
pof Japan.
p

9 Overseas railway
systems- Collaboration with Mitsubishi Heavy Industries in the intra-city railway business.
- Business and capital alliance with Toyo Denki Seizo for electrical components.

9High functional materials - Hitachi Metals established a joint venture with Kobe Steel, IHI and Kawasaki Heavy Industries& components
to manufacture large forgings for use in aircraft and power plants.

9Batteries- Studying opportunities for collaboration with Johnson Controls (U.S.) in the field of advancedenergy storage
storage.

* 1 : Economic and Simplified Boiling Water Reactor* 2 : U.S. Nuclear Regulatory Commission

Copyright © 2011, Hitachi, Ltd., All rights reserved. 32

2-13. Initiatives for Expanding the Social Innovation Business (3)Focusing business resources on the Social Innovation Business
Make capex and strategic investments and focus on advanced technology
9Data centers- Reinforced framework in China
China.

9Cloud computing - Accelerated supplying high reliabilities cloud computing service by new business management.
9IT consulting- Acquired Sierra Atlantic (U.S.) and Sociedad de Consultores Aptivo (Spain).

9Smart cities- Launched smart grid demonstration project with an isolated grid at Rokkasho Village, Aomori
Prefecture.

9 Thermal power
generation- Cooperating with the Government of Saskatchewan (Canada) in development of energy andenvironmentit relatedl t d ttechnologies.
h l i

9 Hydroelectric
power generation- Agreed on business integration with Mitsubishi Electric and Mitsubishi Heavy Industries.

9Railways Systems- Resumed negotiations for a formal contract for planning high-speed intercity railways in the UK.

9Batteries- Developed technology to extend the life of industrial lithium-ion batteries.

9Healthcare- Acquired Aloka to strengthen the medical equipment business.
- Won an order for a proton beam therapy systems from Mayo Clinic, a major U.S. general hospital.

9Others- Integrated Hitachi Software Engineering and Hitachi Systems & Services.
- Merged Casio Hitachi Mobile Communications with NEC's mobile terminal unit.
- Transferred shares of IPS Alpha Technology to Panasonic.
- Decided to transfer HDD operations to Western Digital.
- Decided to merge Hitachi Electronics Services and Hitachi Information Systems.

Copyright © 2011, Hitachi, Ltd., All rights reserved. 33

Cautionary Statement
Certain statements found in this document may constitute “forward-looking statements” as defined in the U.S. Private Securities Litigation Reform Act of 1995. Such “forward-looking
statements” reflect management’s current views with respect to certain future events and financial performance and include any statement that does not directly relate to any historical or
current fact. Words such as “anticipate,” “believe,” “expect,” “estimate,” “forecast,” “intend,” “plan,” “project” and similar expressions which indicate future events and trends may identify“forward-looking statements.” Such statements are based on currently available information and are subject to various risks and uncertainties that could cause actual results to differ
materially from those projected or implied in the “forward-looking statements” and from historical trends. Certain “forward-looking statements” are based upon current assumptions of future
events which may not prove to be accurate. Undue reliance should not be placed on “forward-looking statements,” as such statements speak only as of the date of this document.
Factors that could cause actual results to differ materially from those projected or implied in any “forward-looking statement” and from historical trends include, but are not limited to:• economic conditions, including consumer spending and plant and equipment investment in Hitachi’s major markets, particularly Japan, Asia, the United States and Europe, as well as
levels of demand in the major industrial sectors Hitachi serves, including, without limitation, the information, electronics, automotive, construction and financial sectors;• exchange rate fluctuations of the yen and other currencies in which Hitachi makes significant sales or in which Hitachi’s assets and liabilities are denominated, particularly against the U.S.
dollar and the euro;• uncertainty as to Hitachi’s ability to access, or access on favorable terms, liquidity or long-term financing;• uncertainty as to general market price levels for equity securities in Japan, declines in which may require Hitachi to write down equity securities that it holds;• the potential for significant losses on Hitachi’s investments in equity method affiliates;• increased commoditization of information technology products and digital media-related products and intensifying price competition for such products, particularly in the Components &Devices and the Digital Media & Consumer Products segments;• uncertainty as to Hitachi’s ability to continue to develop and market products that incorporate new technologies on a timely and cost-effective basis and to achieve market acceptance forsuch products;• rapid technological innovation;• the possibility of cost fluctuations during the lifetime of, or cancellation of, long-term contracts for which Hitachi uses the percentage-of-completion method to recognize revenue fromsales;• fluctuations in the price of raw materials including, without limitation, petroleum and other materials, such as copper, steel, aluminum and synthetic resins or shortages of materials, partsand components;• fluctuations in product demand and industry capacity;• uncertainty as to Hitachi’s ability to implement measures to reduce the potential negative impact of fluctuations in product demand, exchange rates and/or price of raw materials or
shortages of materials, parts and components;• uncertaintyias to Hi
Hitachi’s
hi’ ability
bili to achievehitheh anticipatedi idb
benefitsfi off iits strategy to strengthen
h iits S
Sociali l IInnovationi B
Business;i• uncertainty as to the success of restructuring efforts to improve management efficiency by divesting or otherwise exiting underperforming businesses and to strengthen competitivenessand other cost reduction measures;• general socioeconomic and political conditions and the regulatory and trade environment of countries where Hitachi conducts business, particularly Japan, Asia, the United States andEurope, including, without limitation, direct or indirect restrictions by other nations on imports and differences in commercial and business customs including, without limitation, contract
terms and conditions and labor relations;• uncertainty as to the success of alliances upon which Hitachi depends, some of which Hitachi may not control, with other corporations in the design and development of certain key
products;
d t• uncertainty as to Hitachi’s access to, or ability to protect, certain intellectual property rights, particularly those related to electronics and data processing technologies;• uncertainty as to the outcome of litigation, regulatory investigations and other legal proceedings of which the Company, its subsidiaries or its equity method affiliates have become or may
become parties;• the possibility of incurring expenses resulting from any defects in products or services of Hitachi;• the possibility of disruption of Hitachi’s operations in Japan by earthquakes, tsunamis or other natural disasters, including the possibility of continuing adverse effects on Hitachi’s
operations as a result of the earthquake and tsunami that struck northeastern Japan on March 11, 2011;• uncertaintyt i t as tot Hitachi’s
Hit hi’ ability
bilit tot maintaini t i theth integrityi t it off its
it informationi fti systems,t
as wellll as Hitachi’s
Hit hi’ ability
bilit tot protectt t itits confidential
fid ti l iinformationfti or thatth t off its
it customers;t• uncertainty as to the accuracy of key assumptions Hitachi uses to evaluate its significant employee benefit related costs; and• uncertainty as to Hitachi’s ability to attract and retain skilled personnel.
The factors listed above are not all-inclusive and are in addition to other factors contained in Hitachi’s periodic filings with the U.S. Securities and Exchange Commission and in othermaterials published by Hitachi.
Copyright © 2011, Hitachi, Ltd., All rights reserved. 34

Copyright © 2010,2011, Hitachi, Ltd., All rights reserved. 35