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[ 1st Half of fiscal 2006 Performance Briefing ]HDD Head Business Outlook

[ 1st Half of fiscal 2006 Performance Briefing ]

HDD Head Business Outlook

Mr. Takehiro Kamigama Director Executive Vice President General Manager Data Storage & Thin Film Technology Components Business Group

Mr. Takehiro Kamigama
Director
Executive Vice President
General Manager
Data Storage & Thin Film Technology Components Business Group

I'd like to report on the performance of the HDD head business in the first half. Let me start by giving you our interim net sales and forecast for the full year.

Net sales in the first half of fiscal 2006 rose to ¥140.3 billion, compared with the previous sales forecast of ¥135.1 billion. For the second half, we previously projected sales of ¥133.2 billion, but we have now raised our forecast to ¥134.3 billion. Both forecasts assume a rate of ¥100 to the U.S. dollar. We are thus forecasting fiscal year net sales of ¥274.6 billion, compared with our previous forecast of ¥268.3 billion.

Next, I'd like to look briefly at TDK's HDD head market share. Previously, we projected a market share of 34% for fiscal 2006. We have now revised this forecast upward to 36%.

Finally, I would like to discuss the timetable for the qualification of new HDD heads for 2.5-inch and 3.5-inch HDDs.

We plan to begin limited mass production of 160GB/P products with a 3.5-inch platter capacity late this calendar year using TMR Reading head with longitudinal recording technology. Regarding 200GB/P heads, we haven't decided yet whether to produce 200GB/P products or 250GB/P products. 250GB/P heads would use perpendicular recording technology, whereas 200GB/P products would use longitudinal recording technology. Whatever the case, mass production will not start until the second half of fiscal 2007.

With regard to heads for 2.5-inch HDDs, mass production of 80GB/P heads was to begin in November. However, we expect limited mass production to commence in either January or February next year, one quarter later than planned. We looked at both 100GB/P and 120GB/P heads and in the end decided provisionally on 100GB/P heads. These heads, too, are a quarter behind schedule, with mass production not expected to start until August or September next year. These heads will definitely use perpendicular recording technology.

This concludes my presentation. Thank you.

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