Mr. Takehiro Kamigama
Senior Vice President
Data Storage & Thin Film Technology Components Business Group
First I would like to report on this group's sales for fiscal 2004 and the outlook for fiscal 2005.
Net sales were ¥111.4 billion and ¥118.7 billion in the first and second halves of fiscal 2004, respectively. The second-half result was about ¥5.9 billion short of the ¥124.6 billion in sales that we had originally forecast. There were two main causes. Most significant was that the fall in orders accompanying the in-house production of HDD heads by Western Digital (WD) occurred two months earlier than expected. As a result, fourth-quarter sales were about ¥4.9 billion short of our forecast. The other reason was a drop in orders caused by inventory reductions by HDD manufacturers. So WD was 80% of the reason we didn't hit our forecast and inventory reductions the other 20%. The result was net sales of ¥230.1 billion for fiscal 2004.
For fiscal 2005, while we expect almost no orders from WD, we are projecting total net sales of ¥220.1 billion, with ¥101.1 billion in the first half and ¥119.0 billion in the second. So our projection is for net sales of roughly the same level as in fiscal 2004.
Next let's look at HDD head demand and TDK's market share. Our projections here also assume almost no orders from WD. In fiscal 2005, we are forecasting a market share of 30%, 3 percentage points lower than in the previous fiscal year.
Finally, I would like to look at our timetable for launching new products. You will notice that, for this presentation, the handout materials categorize products according to 3.5 inch and 2.5 inch HDDs.
The handout shows that 120GB/P products with 3.5-inch platter capacity will be launched around August this year. We actually expect this to occur around October. 160 GB/P products with 3.5-inch capacity should be launched in the first quarter of next year.
Turning to 2.5 inch models, while an attempt was made to launch 60GB/P products, this proved difficult as customers shifted to 50GB/P products. Mass production of 50GB/P products is expected to start in June or July. TMR heads for 60GB/P products are now in the process of being certified, with launch projected for around October this year. 80GB/P products will be launched later than 160 GB/P products with 3.5-inch platter capacity, probably in the second quarter of next year.
That concludes my presentation. Thank you.