In the 12 months ending March 31, 2006, the Tokyo, Japan-based company’s net profit surged up 115% to JPY 68.5bn ($600m) on sales that rose 0.6% to JPY 4.8trn ($42bn). For the fourth quarter, Fujitsu increased its net profit by 15.9% to JPY 57.5bn ($503m) on revenue that fell 1.4% to JPY 1.5trn ($13.1bn).
The big improvement in profitability was credited to cost reductions in its manufacturing business, a lower tax burden, and the company getting to grips with some loss-making IT services projects in Japan.
Fujitsu made 33% of its total revenue from outside Japan in 2005/2006. Strong sales of optical transmission systems in North America, outsourcing in the UK, and hard disk drives outside Japan, were countered by declines in sales of PCs and servers in Fujitsu’s native market.
Fujitsu president Hiroaki Kurokawa said the company’s overseas business is central to its future growth plans. In the full-year period, Fujitsu reported a decline in both revenue and operating profit in Japan, in contrast to operating profit increases of 96% and 212% at its European and North American businesses respectively.
The company’s technology solutions division, which pools together its IT services and enterprise server business, reported a 15.6% increase in operating profits to JPY 164bn ($1.4bn) for the full-year period on revenue that grew 1.7% to JPY 2.89trn ($25.3bn). This was largely driven by its IT services business which improved its operating profit by 42.4% to JPY 138bn ($1.2bn).
Looking ahead, Fujitsu said it expects to increase its revenue by 8.5% to JPY 5.2trn ($45.5bn) in the year ending March 31, 2007, with net profit forecast to rise 16.7% to JPY 80bn ($700m).
