To Our Shareholders

Toshiaki Higashihara
President & CEO

In fiscal 2015, the final year of the 2015 Mid-term Management

Today, global competition is intensifying. Moreover, the trends

Plan, Hitachi recorded revenues of ¥10,034.3 billion (3% up YoY),

toward the Internet of Things (IoT) and digitalization are starting

adjusted operating income of ¥634.8 billion (1% down YoY), EBIT

to generate significant changes, not only in the way businesses(earnings before interest and taxes) of ¥531.0 billion (1%, down

operate but also in the way people live.

YoY), and net income attributable to Hitachi, Ltd. stockholders of¥172.1 billion (21% down YoY).
During the 2015 Mid-term Management Plan, Hitachi“An Innovation Partner for the IoT Era,” we formulated the 2018
Mid-term Management Plan in May 2016. With the focusedachieved a stable adjusted operating income ratio above 6% andbusiness domains of Power / Energy; Industry / Distribution / Water;

recorded steady improvement in its earning power. In addition,Urban; and Finance / Public / Healthcare, Hitachi will expand its

we have been increasing our cash-generating capability throughglobal business by developing an advanced Social Innovation

the Hitachi Smart Transformation Project. Hitachi continues toBusiness utilizing digital technologies.

concentrate investments in the Social Innovation Business, andAccordingly, beginning this fiscal year, we launched a

has acquired businesses with annual sales of ¥600.0 billion tomarket-driven business structure comprised of three layers.

strengthen its position in key focus areas. In addition, we reorga-The layers include the front, which consists of primarily the 12

nized our portfolio by deconsolidating businesses with annual

business units that work to develop and provide services close tosales of ¥900.0 billion. With these measures, we aggressively

customers; the platform, which enables the Company to provide

restructured our business portfolio and further increased ourservices quickly and efficiently; and the products, which are

earning power, while also creating a pathway for future growth.

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Anticipating these changes and aiming to become

Hitachi, Ltd. | Integrated Report 2016globally competitive. Lumada, our newly built IoT platform, is ancreation with its customers and contribute to enhancing the qual-open, highly flexible common platform that incorporates theity of life for people. We also aim to achieve sustainable growth.

artificial intelligence (AI), analytics, and operational technology

We would like to ask for your continued support and understand-that are indispensable in service development. With Lumada,ing in the years ahead.

Hitachi is accelerating collaborative creation with its customers.
Under the new Hitachi business structure, our front will draw
upon the products and platform to drive innovation and deliver

August 2016

new value to society.

President & CEO

In fiscal 2018, we will strive to achieve revenues of¥10,000.0 billion, adjusted operating income and EBIT ratios ofmore than 8% each, and net income attributable to Hitachi, Ltd.
stockholders of more than ¥400.0 billion through theseinitiatives. These are milestones for Hitachi’s global growth andthe minimum targets we must achieve.
Through the advanced Social Innovation Business, which
utilizes digital technologies, Hitachi will accelerate collaborative

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