Fiscal Year 2020
Financial
Results
Management Direction Update
April 28, 2021
Takahito Tokita
CEO & CDXO
Fujitsu Limited
Copyright 2021 FUJITSU LIMITED
Fujitsu's Purpose
Our purpose is to make the world more sustainable
by building trust in society through innovation
1 | Copyright 2021 FUJITSU LIMITED |
FY2020 Results and Initiatives
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Summary of FY2020 Financial Results
- Despite a reduction in sales because of the impact of COVID-19, operating profit and
profit for the year reached the highest levels ever | (Unit: Billions of yen) | ||||
2019(Actual) | 2020(Actual) | Variance | |||
Revenue | 3,857.7 | 3,589.7 | ▲268.0 | ||
Operating Profit | 211.4 | 266.3 | 54.8 | ||
Operating Profit Margin | 5.5% | 7.4% | 1.9% | ||
Profit for the Year | 160.0 | 202.7 | 42.6 | ||
Technology Solutions | |||||
Revenue | 3,212.9 | 3,043.6 | ▲169.2 | ||
Operating Profit | 187.9 | 188.4 | 0.5 | ||
Operating Profit Margin | 5.8% | 6.2% | 0.4% | ||
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Copyright 2021 FUJITSU LIMITED |
Priority Issues in Achieving Our Purpose
- Creating value through "For Growth" and "For Stability" initiatives, and contributing to the growth and stability of our customers' businesses
- Self-transformationthrough further implementation of internal DX initiatives
Value For
Creation Growth
Our | For |
Stability | |
Purpose | |
Internal | Internal |
Transformation | |
DX |
- Rebuilding our global business strategy
- Strengthening issue resolution capability in Japan
- Contributing to greater business stability
- Becoming our customers' best DX partner
- Enforcing data-driven management
- DX talent development and productivity improvement
- Fully participatory, ecosystem-based DX promotion
4 | Copyright 2021 FUJITSU LIMITED |
Rebuilding Our Global Business Strategy
Implementing a globally uniform portfolio, account plans, offerings, and alliances
Reformed service delivery organization
Structural reforms in International Regions
Europe (NWE/CEE): Completed structural reforms to product manufacturing organization
Americas: | Currently implementing business structural reforms |
Oceania: | Transformed and strengthened organizational formation by industry |
Asia: | Enhancing offerings to priority industry segments |
5 | Copyright 2021 FUJITSU LIMITED |
Strengthening Issue Resolution Capability in Japan
Launched Fujitsu Japan with an 11,000-employee organization
Establish single point of contact for customers and provide one-stop services
Falling Population | Increasing Severity | Disparities in the Ways |
of Disasters | People Work | |
Aging Population and | Regional Disparities |
Falling Birthrate | |
Establish 6 regional headquarters nationwide and promote proposal activities aligned with regional characteristics
Aggressively expand DX business by changing sales |
style to deal with societal issues |
Fujitsu Japan Limited
Abundant industry and |
operational know-how |
Business-centered proposals
Cloud First
6 | Copyright 2021 FUJITSU LIMITED |
Strengthening Issue Resolution Capability in Japan
Fugaku Continues to Dominate Global Rankings (Second Consecutive Term)
Contributing to Resolving Various Issues Facing Modern Society
The Environment | Disaster Prevention | Health |
Contributing to improved | Delivering high-resolution | Providing network |
accuracy in weather and | real-time tsunami and | analysis of cancer genes |
climate change prediction | flood predictions | in less than a day |
with history's largest ever | ||
weather computation | ||
©RIKEN
7 | Copyright 2021 FUJITSU LIMITED |
Strengthening Issue Resolution Capability in Japan
Launch of Future Society and Technology Unit
Future Society | Social | Cutting Edge | ||||||
Implementation | ||||||||
Design | Technology | |||||||
Architect | ||||||||
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Contributing to greater business stability
Establishing Japan Global Gateway
- Improving quality and productivity through internal production and thoroughgoing standardization
- Building a delivery model that can apply globally
Reorganization of SI Group Companies
- Improving productivity and profitability by reorganizing the SI structure of the Group as a whole
- Aggregating the technical strengths of each company, expanding business through integrated capabilities and resource utilization
Stable Operation of Customer IT Platforms
- Establishing a company-wide risk management office under the CEO
- Conducting a company-wide inspection to prevent critical system faults
9 | Copyright 2021 FUJITSU LIMITED |
Becoming Our Customers' Best DX Partner
Enhancing Front-line Capabilities
・Developing Business Producers who can lead customers' DX with an ability to empathize ・Integrating Business Producer and delivery functions
Activities of Ridgelinez
・Currently extending consulting services for achieving DX to around 300 customers in a variety of industries
・Building a professional human resources system to maximize performance
10 | Copyright 2021 FUJITSU LIMITED |
Becoming Our Customers' Best DX Partner
Creating DX Business Through Collaboration with Partners
Established a new company (PeptiAID) with the goal of developing treatments for COVID-19
Established a new company (DUCNET) to provide cloud services that will enable DX in the manufacturing industry
Supported accelerated DX and enhanced competitiveness for customer retail storefronts (Collaboration with Zippin)
11 | Copyright 2021 FUJITSU LIMITED |
Internal Transformation
Enhancing Data Driven Management
- Promoting One Fujitsu initiatives to make all important business operations globally uniform
- Implementing data analysis technology internally
DX Talent Development and Productivity Improvement
- Developing DX talent by promoting design thinking
- Support highly productive ways of working with job-based HR management and Work Life Shift
Fully Participatory, Ecosystem-based DX Promotion
- Started internal DX project (Fujitra), with approximately 300 transformation plans underway
- Started "VOICE Program" which collects voices from our customers and employees to be reflected in our management and business initiatives
12 | Copyright 2021 FUJITSU LIMITED |
Financial Forecast for FY2021
- Working toward the achievement of the FY2022 management targets -
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Financial Forecast for FY2021
- Aim for higher revenue and profit in Technology Solutions by fully executing the initiatives from last fiscal year
(Billions of yen) | ||||
2019(Actual) | 2020(Actual) | 2021(Forecast) | Variance from FY | |
20 to FY 21 | ||||
Revenue | 3,857.7 | 3,589.7 | 3,630.0 | 40.3 |
Operating Profit | 211.4 | 266.3 | 275.0 | 8.7 |
Operating Profit Margin | 5.5% | 7.4% | 7.6% | 0.2% |
Profit for the Year | 160.0 | 202.7 | 205.0 | 2.3 |
Technology Solutions | ||||
Revenue | 3,212.9 | 3,043.6 | 3,200.0 | 156.4 |
Operating Profit | 187.9 | 188.4 | 240.0 | 51.5 |
Operating Profit Margin | 5.8% | 6.2% | 7.5% | 1.3% |
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Copyright 2021 FUJITSU LIMITED |
Accelerate Growth Alongside Customers
Based on Resolving Societal Issues
- Seven key focus areas that will drive the "For Growth" sector
Sustainable | Consumer | Healthy | Trusted | |
V e r t i c a l | ||||
Manufacturing | Experience | Living | Society | |
Circular, traceable | Payments, logistics and retail | Supporting all kinds of | Creating communities | |
manufacturing with | that provide consumers with | people in living in ways | that embody safe, secure | |
consideration to the | diverse experiences | that promote wellbeing | and resilient | |
environment and people |
Horizontal
Digital Shifts | Business Applications | Hybrid IT | |||
Data-Driven | Work Style Reform | Cloud Integration | Applications | Cloud | Security |
15 | Copyright 2021 FUJITSU LIMITED |
Enhanced R&D to Accelerate Innovation
- Integrated Fujitsu Laboratories directly under the CTO and consolidated research and analysis functions and R&D functions
- Rapid execution of research and development aligned with corporate strategy
Research/Analysis Functions
Medium- and Long-term
Technology Strategy
R&D Functions
Basic research | Applied research |
Global Technology | Use of open technology | Creating future | Practical use of |
Trends Survey | (M&A, Tie-up ) | corporate value | products and services |
16 | Copyright 2021 FUJITSU LIMITED |
Capital Allocation Policy
- To achieve the management target, Fujitsu is continuing its initiatives to generate over 1 trillion yen of free cash flow over 5 years , and over 500 billion yen in strategic growth investments.
Value Creation
• | Expand Key focus areas | |
Growth | • | Enhance Services business |
Free Cash | Investments |
Flow
(FCF)
ESG
Initiatives
Shareholder
Returns
Internal Transformation
- Fostering talent development , Reforming the ways we work
- Enhancing data-driven management
• Environment | • Regional communities | • Sports |
- Generating stable shareholder returns
- Cash dividend increase by 20 yen this term, set treasury stock plan for 50 billion yen
In terms of capital efficiency, Fujitsu aims for sustaining growth (CAGR 12%) of Earnings Per Share.
17 | Copyright 2021 FUJITSU LIMITED |
Environmental Initiatives
SBT* 1.5°C
Certification
Greenhouse Gas Reduction Targets
- Upward revision of reduction targets from 2°C Certification(2017) to 1.5°C
- Accelerate comprehensive energy saving and utilization of renewable energy, with the goal of a 71.4% reduction by 2030 (compared to FY2013)
Avoid Risks,
Minimize
Environmental Burden
In our Business Activities
- Make further progress in resource-saving designs for products and packaging with the goal of reducing plastics
- Reduce water usage across the supply chain, strengthen water risk evaluation
Resolve
Environmental Issues
Through Business
- 100% renewable energy will be used for operating our cloud service "FJcloud" by FY2022.
- Contributing customers to reduce CO2 emissions through more efficient logistics routes using Digital Annealer
*Science Based Targets:
- Goals identified by initiatives established by organizations such as the UN Global Compact.
- Certified greenhouse gas emission reduction targets that are scientifically consistent with the levels required by the Paris Agreement
18 | Copyright 2021 FUJITSU LIMITED |
Non-Financial Indicators
- Assessment of relationship of trust between stakeholders and Fujitsu's own transformation using objective indicators
Client Net Promoter Score |
- Conducted global survey
- Plan to set target by this fiscal year
Employee Engagement | 56 % | 65 % | 75 % |
FY2019(Actual) | FY2020(Actual) | FY2022(Target) |
DX Promotion Indicator |
1.9 2.4 3.5
FY2019(Actual) FY2020(Actual) FY2022(Target)
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Initiatives to Achieve Management Goals by FY2022
- Accelerate growth investments, aiming for revenue of 3.5 trillion yen and an operating
profit margin of 10% in Technology Solutions | 10 % |
Operating | 6.2 | % | 7.5 % | ||
5.8 % | |||||
Profit Margin | |||||
3,500.0 | |||||
Revenue | 3,212.9 | ||||
3,043.6 | 3,200.0 | ||||
1,300 | |||||
For Growth | 985 | 988.9 | |||
(37 | % | ||||
(31%) | (32%) | ) | |||
For Stability
Billions of yen
(Fiscal Year) | 2019 | 2020 | 2021 | 2022 |
(Actual) | (Actual) | (Forecast) | (Medium-term Plan) | |
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Expanding Revenue
- Expanding on key focus areas
- Enhancing the services business
Improving Profitability
- Transforming the service delivery structure
- Structural transformation in regions outside Japan
- Limiting unprofitable projects
Copyright 2021 FUJITSU LIMITED
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Cautionary Statement
These materials may contain forward-looking statements that are based on management's current information, views and assumptions and involve known and unknown risks and uncertainties that could cause actual results, performance or events to differ materially from those expressed or implied in such statements. Actual results may differ materially from those projected or implied in the forward-looking statements due to, without limitation, the following factors listed below.
- General economic and market conditions in key markets (Particularly in Japan, Europe, North America, Oceania, and Asia, including China)
- Fluctuations in exchange rates or interest rates
- Fluctuations in capital markets
- Intensifying price competition
- Changes in market positioning due to competition in R&D
- Changes in the environment for the procurement of parts and components
- Changes in competitive relationships relating to collaborations, alliances and technical provisions
- Risks related to public regulations, public policy and tax matters
- Risks related to product or services defects
- Potential emergence of unprofitable projects
- Risks related to R&D investments, capital expenditures, business acquisitions, business restructuring, etc.
- Risks related to natural disasters and unforeseen events
- Changes in accounting policies
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Fujitsu Ltd. published this content on 28 April 2021 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 28 April 2021 06:08:02 UTC.