Fiscal Year 2016
Business Strategy
Representative Director
President and CEO

Tomonori Hayashi
May 17, 2016

FUNAI ELECTRIC CO., LTD.
TSE 6839
0 Overview for the Fiscal Year 2015
 Outlook for business environment
 Forecast for the Fiscal Year 2016
 Management Policy Business strategy
 Expand new business Production and sales base1 Overview for the Fiscal Year 2015（100 million yen）

PreviousForecast

Revised
Forecast

ActualS a l e s

2,200

1,879

1,681

Operating Income

16

‐60

‐130（0.7%）（‐3.2%）（‐7.8%）

118.00119.86119.98N e t(Margi

Average USD‐JPY
Exchange Raten)

 The orders for LCD‐TVs for the year‐end sales in the U.S. decreased.
 Price competition in regional mass merchandisers in the U.S.
Summary  Red ink increased due to shortfall of sales forecast.
 Foreign exchange losses due to the depreciation of Mexican Pesoagainst yen.
2 Factor for FY2015 and Countermeasure for FY2016
Factors for the FY2015
 The shortage of orders for LCD‐TVs for the year‐end sales in the U.S Price competition in regional mass merchandisers in the U.S.
 Red ink increased due to shortfall of sales forecast.
 Foreign exchange losses due to the depreciation of Mexican Peso against yen.

Countermeasure for the FY2015
 Focus more energy on obtaining orders for the year‐end sales in the U.S.
 Forward exchange contracts to hedge transactions denominated in MexicanPesos.
 Expand Philipps brand models.
3 Outlook for business environment
Economic Trends■the U.S.

■Europe■China

The business expansion trend in the U.S. economy is likely to continue atleast through the year‐end . Long‐term interest rates are expected to rise,
and the dollar is following a one‐sided appreciation trend. However, there
are concerns about the impact on the U.S. of economic deterioration inemerging countries.
The European economy may stagnate due to geopolitical risks coupled withthe refugee issue and other problems.
The Chinese economy has slowed because of slumping real estate andstock markets and will take time to recover.

 The U.S. economy remains the sole winner, and dollar
appreciation continues.
 Competitor offenses and price competition in the U.S. market
are intensifying due to factors including the businessslowdown in China.

We must beat in competition against companies
such as Chinese fighting for survival.

4 Forecast for the Fiscal Year 2016
FY2015
ActualFY2016
ForecastYoY

S a l e s

1,681

1,720+39

Operating Income‐130

43+173（‐7.8%）（2.5%）

119.98112.00N e t(Margi

Average USD‐JPY
Exchange Raten)

Summary Become more profitable by offering large‐size screen LCD‐TVs and UHD
Blu‐ray player.
 Increase sales in‐house development ink‐jet printers.
 Begin selling a multi‐model line of inkjet printers.

5 Management policy

Management policy Rebuilding Funai Production System and Training
human resources Strengthen profitability － go into the black Market‐oriented strategy
 Accelerate expansion new business and market
 Enhance the corporate value
6 Management policy
Rebuilding Funai Production System(FPS) andTraining human resources Improve productivity by back to the source Training human resources through the practice of FPS

Strengthen profitability － go into the black Re‐Take thorough reduction of fixed costs
 Review allocation of human resources(the right peoplein the right place) Manage profitability strictly

All of us join forces in an all­out effort
to get over difficulties.

7 Management policy
Market-oriented strategy
 Improve marketing and product planning Provide high quality and reasonable products

Strengthen
product⇒ Meet the customer’s needs
Strengthen
after-sales
service Speedy after‐sales service
 Feedback return products information⇒ Reflect to product planning and design

Increase sales and profit
Enhance brand value8 Management policy

Enhance corporate value

Increase sales
Improve profit

Improvefinancialstability

Strengthen
corporategovernance

Head for sustainable growth9 Business Strategy
Applied ink jet printertechnology

Build new business

Healthcare/Medical

Expand printer business

Improvecompetitiveness ofexisting business

Aim for profitable printer and new businessby company-wide support
10 Expand new business
Applied ink jet printer technology
 We are applying microfluidics (a high‐precision control technology
using picoliter‐scale droplets) in beauty products, chemicals,medications, and various other fields.
 Joint development with global companies in preparation forcommercialization is underway.

Healthcare/Medical
 We have succeeded in technical development of
the world’s first LED photoacoustic imaging
system through closer cooperation with abusiness partner.
 We start to develop Dental CT diagnosticequipment
11 Production and sales base
North America sales/service baseProduction base
China

Huang Juang(consignment)

TVs・DVDs

Thailand

Pakchong

TVs(main)

Printers

Philippines Cebu

Ink Cartridges

Luzon

Inkjet Printers

New Mexicana
production

FUNAI (THAILAND)
CO.,LTD

Funai Corp.
P&F USA

NJ/LA
Atlanta

Sales

Integrate

Funai ServiceCorp.

Ohaio

ServiceStrengthen

Sales

Branding

P&F Mexicana

TV

Huang Juang(consignment)FUNAI ELECTRIC
PHILIPPINES INC.

FUNAI ELECTRIC
CEBU. INC.

12Disclaimer

This document contains forward‐looking statements and projections regarding
business performance which are not historical facts. Please note that these statements
are based on information relating to factors that may impact future businessperformance that was available for analysis at the time this document was printed.
These factors include industry trends relating to the business areas of Funai Electric Co.,
Ltd. or the Funai Group, such as audio‐visual devices and information communicationequipment, the economic conditions of both domestic and international markets, andfluctuations in currency exchange rates. Actual performance may greatly differ fromprojections included in this document because of the impacts of uncertainty in suchareas as the competitive conditions of the electronics industry, market trends, currency
exchange rate, introduction and success of new products, and various other global
conditions that may affect the tax system and other systems.

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