Nikon | Investor Relations | Q&A of Financial Results for the Third Quarter of the Year Ending March 31, 2010

The following includes questions and answers at the conference for the financial results for the Third Quarter of the Year Ending March 31, 2010.

Precision Equipment Business

Q:What is the outlook for the market of steppers and scanners?: A:
As for IC steppers and scanners, the inquiries are increasing mainly for ArF immersion scanner and KrF scanner. The market size for IC steppers and scanners in 2010 is expected to reach 180-190 units, among which around 100 units will be the products of immersion scanner. With regard to LCD steppers and scanners, the orders have been rising since last autumn as customers are aggressive to invest in the capital expenditure. We expect the LCD steppers and scanners market size in 2010 to reach some 90 units.
Q:Can you provide us with information about the NSR-S620 ArF immersion scanner?: A:
We expect to book the first sales of this product in February. It proves that the degree of completeness for throughput, alignment accuracy and lens performance of image formation is steadily improving as scheduled.
Q:Could you tell us about steps to enter the Chinese LCD steppers and scanners market?: A:
With growing demand for 7th generation and later LCD steppers and scanners in the Chinese market, we have been aggressively engaging in business activities in anticipation of starting sales from next fiscal year. As a result, we received orders for 16 units of LCD scanners for 8.5th generation in January. We will steadily ensure deliveries of these products, and we will make further efforts to expand the sales.

Q:What is the status of the digital camera market?: A:
Overall, we are seeing continuous growth in the digital SLR camera market worldwide, though there are fluctuations in sales depending on the region. On the other hand, the compact digital camera market in each region recorded negative sales on a year-to-year basis. We expect the sales to decrease in comparison with that of previous year on the whole year basis but the degree of negative sales has been dwindling since last autumn. We forecast the market size in the year ending March 2010 will slightly exceed our estimation of last November (10 million units of digital SLR cameras, 98 million units of compact digital cameras). Regarding the market size for the year ending March 2011, we anticipate sales of digital SLR cameras to increase some 10% over present fiscal year and the sales of compact digital cameras will surpass the quantity (103.69 million units) of the year ended March 2009.
Q:How are imaging products business earnings?: A:
For this 3Q period, we saw the highest sales of digital SLR cameras, interchangeable lenses and compact digital cameras compared with past quarters. We expect the sales for 4Q period will perform solidly and estimate earnings for the whole fiscal year to remain as we estimated in November in consideration of the harsh competitive environment, the risk of the yen's appreciation and the increase in the initial cost of new products though there may be a little upward change.

Q:What is the forecast of sales and profits?: A:
We revised consolidated net sales upward by 10 billion yen and the operating income by 2 billion yen. On the other hand, sales and profits of each Precision Equipment Company and Imaging Company will remain unchanged. All positive revision will be consolidated into other businesses as the margin for revision is slight as a result of a review. As for each profit in the latter half, we expected only the operating income to go in the black at the previous financial forecast in November, 2009. However, as a result of the current review, each profit, along with the operating income, will go in the black.