FY2018 Strategy~Efforts to break away from the deficit~
May 15, 2018

FUNAI ELECTRIC CO.,LTD.
President and CEO

Hideaki Funakoshi
FY2018 means from April 1th,2018 to March 31,2019 Table of Contents

１．Management philosophy, Group vision
２．Competitive strategy

３．Business-specific policy1 Management philosophy, Group vision【Fundamental Principles】

Dreams with Conviction,and Information with Behavior【Management Philosophy】

Challenge the company to growby becoming helpful in the community【Group Vision】

FUNAI creates products that will be chosen
by people all over the world“For the world”, as a global company“We will be chosen”, striving to reach the top of the industry“We will create products”, that people will love2 Table of Contents

１．Management philosophy, Group vision
２．Competitive strategy

３．Business-specific policy3 Overall picture of competitive strategy【Core competence】~FPS：Technology to improve productivity cycle with ingenuity~

Reform the profit structure by developing a new competitive strategy
for sustainable growth

Basic strategy①NA: Expand market share
Expansion of SKU ofmajor mass merchants

AI TV market launchBusiness strategy
Positioning strategyAlliance strategy

Ensure positioning that maximizes
the company's capabilities②JPN: Penetration of FUNAI brandDifferentiation by launching attractive products

Establish a position in the JPN

Supplying modules to alliances companies③Development of new business

Two basic reforms

Entered into new fields throughNew and EV business

Human resource
development

Thorough corporate
governance4

 Basic strategy: ①NA: Expand market share ~Sales Strategy~
・Expanding SKU of major mass merchants following Walmart
・AI TV market launch
Expansion of SKU ofmajor mass merchants

Walmart

Voice-activated AI TV market launchmajor massmerchants

COSTCOBEST BUY

amazonTARGET

etc...

Android TV

Google Assistant

Expand market share by boosting high-value added
products in North America5

 Basic strategy: ②JPN: Penetration of FUNAI brand ~Sales Strategy~
・Enhanced FUNAI lineup by introducing OLED・Brand penetration by advertising enhancements andcustomer satisfaction

Enhanced lineup
OLED

Brand penetration strategy

New model
LCD TV●Product development based on customer
needs●Enhancement of software functions●LA Angels official sponsor●Utilize the inbound effectOLED＋New Model

Established a position of the FUNAI brand in Japan
6

 Basic strategy: ③-1 Development of new business ~Product development of OS business~・Develop the new products from research and development
results of office solution (OS) business
Nail PrinterMulti Printer
Coupon Pirnter

From development
to harvest stage
C&I(Industrial ink cartridge)
CISS(Printer with large capacity ink)

7 Basic strategy: ③-2 Development of new business ~Application of existing technology~

・Development of derived business utilizing OS businesstechnology(micro-fluidics)
・Entry into new fields such as nursing care and medical carethrough New and AV business
Micro-fluidics

In-vehicle
Direct backlight

Auto-Pipetting

Health-care/Medical-care
Motorized bed

Dental CTBusiness AV equipment
Digital Signage
Sickroom TV

Hotel TV8 Basic strategy: ③-3 Development of new business ~Entry into the EV business~

・Enter into a wide range of EV related businesses throughpartnership with alliance companies
・Becoming a company that grows sustainably whileconsidering the environment through the EV business
Signed a capital and business alliance agreement with the FOMM Corporation
which is compact electric vehicles development company at last November.
Meter panel

In-vehicle direct backlight

Look for various
cooperation withalliances companies
Supply of molded parts
Supply of component
modules
Sharing service

Car Audio

OthersInverter
Molded parts
Ranging sensor
ECU

9 Table of Contents

１．Management philosophy, Group vision
２．Competitive strategy

３．Business-specific policy

10 TV market trends

NAUnits

JPN
CHN

NASalesJPN

CY2016

CY2017

CY2018CY2019CY202043,40036,76337,41436,982

36,637

※１

4,880

5,500

6,500

8,000

※２

44,00046,000－－※３

2016年

2017年

2018年

2019年

2020年

16,80015,690

15,90015,70015,600※１3,405

3,780

4,200

4,900

6,100

※２－－

（thousand Units）

－
4,748
－
50,000－（million USD）－

※1: Our guess value based on the NPD data.
※2: Our guess value based on JEITA statistical data.
※3: Our guess value based on hearings by panel makers.

11 Mid-term performance targets(100 million USD)FY2017
Actual

FY2018
Forecast

FY2019Forecast

FY2020
Forecast

Difference
FY2018 andFY2020
Forecast

1,301

1,030

1,130

1,300

＋270(126%)

North＋Latin America

950655640

630

-25

Japan＋Others

351375490

670＋295

Operating Income-1084

711＋7（Margin）(-8.3%)(0.4%)(0.6%)(0.8%)

Exchange(Premise)$⇒¥@110.69

@105

@100

@100Net Sales(275%)

12 Business-specific policy: Display businessMove back into the black Towards an increase of sales（100 million Yen）

1,020

1. Enhance online sales
2. Enhance FUNAI brand and OEM products

3. Exploitation of ASEAN market

Net Sales
810880

 Towards an increase of profit
1. Thorough PSI and Supply Chain
Management
2. Optimization of production system
focusing on US tariff
3. Reduced service cost

FY2018FY2019FY2020(Forecast)13 Business-specific policy: Digital Medium business

Battle for business to survive
 Towards an increase of sales
1. NA: Exploitation of new customers
2. JPN: Enhances lineup of FUNAI brand（100 million Yen）

Net Sales
150

155140

 Towards an increase of profit
1. Optimization of production system
2. Thorough reduces costs
3. Ensure a profit of the remaining players

FY2018FY2019FY2020(Forecast)14 Business-specific policy: Office Solution business

Break away from the deficit
 Towards an increase of sales（100 million Yen）

1. Launches a CISS Printer90

2. Exploitation of new customer of C&I

3. Entry into niche printer market

80
Net Sales50

 Towards an increase of profit
1. Drastic overhaul of unprofitable product2. Stabilization of profit base by OEM business
3. Launches a micro-fluidics products

FY2018FY2019FY2020(Forecast)15 Business-specific policy: Development / New businessNew business development
 Towards an increase of sales（100 million Yen）

1. Commercialization of AV equipment forbusiness use

2. Commercialization of in-vehicle products
3. Expand business field through EV strategy

 Towards an increase of profit

3530
Net Sales20

1. Improve profit margin by healthcare andmedical products
2. Ensure revenue base by AV equipment forbusiness use
3. Developing and commercialization of highvalue added products

FY2018FY2019FY2020(Forecast)16 注意事項

This document contains forward-looking statements and projections regarding
business performance which are not historical facts. Please note that thesestatements are based on information relating to factors that may impact futurebusiness performance 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
communication equipment, the economic conditions of both domestic andinternational markets, and fluctuations in currency exchange rates.
Actual performance may greatly differ from projections included in this document
because of the impacts of uncertainty in such areas as the competitive conditionsof the electronics industry, market trends, currency exchange rate, introduction
and success of new products, and various other global conditions that may affectthe tax system and other systems.

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