Fujifilm FY 2020 Earnings

Imaging Solutions
In the Imaging Solutions segment, consolidated revenue amounted to ¥285.2 billion (down 14.2% year-over-year).

Consolidated operating income amounted to ¥15.6 billion (down 37.8% year-over-year).

In the photo imaging business, revenue decreased due to the impact of voluntary restraint and cancellation of events resulting from the spread of the COVID-19 pandemic, but sales of instant photo systems, which enable users to enjoy on-the-spot printing of photos, increased year-over-year in the second half. Sales of instant photo systems recovered mainly in Europe, the U.S., and China as we strengthened online sales by using social media to promote a new way of enjoying time at home. Sales of the instax mini Link, a printer for smartphones, and the instax mini 11 instant camera were favorable, and the instax SQUARE SQ1, an entry model launched in November 2020 compatible with the popular square format film also contributed to higher revenue. For print services, new personalized features were added to the Year Album, a photo book service, in April 2020, enabling automatic selection and layout of photos according to individual interests and preferences through the use of AI technology, which have been well received by users. We will continue meeting increasingly diverse customer needs and offering user-friendly, high-value added products and services, while also communicating to the world the intrinsic photographic values of “shooting, preserving, displaying, and gifting.”

In the optical device and electronic imaging business, revenue from the electronic imaging field, which decreased in the first half due to reduced demand stemming from the COVID-19 pandemic, recovered in the second half to rise above the level of last year. The FUJIFILM X-S10 mirrorless digital camera, launched in November 2020, has been well received for its powerful image stabilization and large grip despite its compact size, and it has contributed to the expansion of the X mount user base. Sales of the FUJIFILM GFX100S, released in February 2021 together with the FUJINON Lens GF80mm F1.7 R WR, exceeded expectations, having gained a high reputation worldwide for its superior image quality using a large format sensor despite its compact body. Going forward, we will continue providing value-added products and revitalizing the market, along with providing the pleasure of taking photos.

In the optical device field, sales of broadcast and cinema lenses fell due to cancellation of events and shooting, but sales of monitoring zoom lens and surveillance camera with built-in zoom lens have risen year-over-year from the second quarter. Aiming to achieve business growth in this field, we are expanding our business domains and continuing to develop innovative products that satisfy the diverse needs of the market, including ultra-short-throw projectors and long-range surveillance cameras, and newly developed multispectral camera systems.

Earnings Presentations
In the photo imaging business, in addition to the drop in demand for color paper, the impacts of COVID-19, including stay-at-home orders and temporary store closures, drove down revenue, but sales of instant photo systems increased year-over-year in the second half. Sales of the instax mini 11 and the instax mini Link smartphone printer were particularly strong in Europe, the U.S. and China.

In the electronic imaging business, despite the severe climate in the entire digital camera market, favorable sales of mirrorless cameras, including the FUJIFILM X-S10, which has been acclaimed for its compact size, easy-to-hold grip and powerful image stabilization, and FUJIFILM GFX100S, released in February 2021, which has been acclaimed for its superior image quality using a large format sensor despite its compact body, allowed revenue to rise year-over-year in the second half.

In the optical device business, revenue fell, mainly due to a decline in sales of broadcast and cinema lenses, which were hit hard by voluntary restraint of events, but revenue has been on a recovery trend since the fourth quarter (3 months).

The Imaging Solutions segment recorded lower revenue, primarily due to the impact of COVID-19, but sales are recovering steadily as revenue from instant photo systems and the electronic imaging field increased year-over-year in the second-half.
Operating income, which fell in line with lower revenue, recovered in the second half, as the segment more than offset the impact of COVID-19.

Notice of a Special Loss in a Consolidated Subsidiary
FUJIFILM Corporation (“Fujifilm”), a wholly owned subsidiary of FUJIFILM Holdings Corporation, has decided to record a special loss in its financial statements for the fiscal year ending March 2021 (from April 1, 2020 to March 31, 2021) as follows.

1. A Special Loss
Owing to such factors as deterioration in the business environment centering on antibacterial agents amid the COVID-19 pandemic, the business plan of FUJIFILM Toyama Chemical Co., Ltd. (“FUJIFILM Toyama Chemical”) was reviewed to reassess its business value. As a result, the value of the shares of FUJIFILM Toyama Chemical held by Fujifilm is expected to decline significantly. Therefore, Fujifilm is to record a special loss of approximately JPY 81.5 billion as a loss on devaluation of stocks of subsidiaries and affiliates in the non-consolidated financial statements for the fiscal year ending March 2021.

2. Impact on Consolidated Financial Statements
The loss on devaluation of the stocks recorded in the non-consolidated statement will be eliminated at consolidation level and will not affect the consolidated financial statement.

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