Instruments Company

• Overview
• Business Strategy
• An Interview with the Company President

As of December 1, 2011

Overview

Main Products

Biological microscopes, industrial microscopes, stereoscopic microscopes, measuring instruments, semiconductor inspection equipment

Consolidated Financial Results

Market Environment and Business Trends

The outlook for both the bioscience field, on the back of shrinking public budgets and the suspension and deferral of execution, and the industrial instruments field due to deteriorating market conditions, particularly for semiconductors, is severe.

Business Strategy

An Interview with the Company President

Q2:What is the market outlook in the bioscience field and Nikon’s sales measures?

A2:

In the Japanese market, we expect that measures to secure the necessary funding for disaster recovery will affect the budgets of universities and research institutions, and that instrument purchasing budgets will decline in the second half of the fiscal year ending March 2012. In overseas markets, we anticipate that the public spending in the United States tends to be controlled and there is also an increasing degree of uncertainty in Europe, a market we expected to be relatively stable. On the other hand, we are forecasting continued strong growth in emerging markets such as China and India and stable growth of overseas markets overall.

Considering this market environment, for our strong-selling, high-end products such as super resolution microscopes and confocal microscopes, we plan to continue making improvements in such areas as software, and to utilize direct sales channels in the field of advanced research, thus giving sales further momentum. For products in the volume sales range sold through distributors and similar sales channels, we will aim to enhance our market position, and expand the scale of sales. For both types of products we will be implementing measures to increase sales in emerging markets.

Q3:In the industrial instruments field, what is the outlook for 3D measuring systems, and what other issues does Nikon face?

A3:

We see the effects of increased controls on capital expenditure in the market for industrial instruments for semiconductors and electronic components. The market for automotive instruments may dip temporarily as a result of the effects of the Great East Japan Earthquake, but we anticipate a growth trend over the medium term led by emerging markets.

Nikon is working to strengthen its sales force, focusing on non-contact, 3D measurement systems, and targeting regions and industries where its market share is still low. In the non-contact metrology field in particular, to date our two-dimensional measuring systems have captured markets in such fields as semiconductors and electronic components. With sales efforts now fully underway for the HN-6060 system, a 3D measuring system launched in December 2010 that offers advanced functionality and performance, we will focus not only on the aforementioned fields but also on opening up new markets for instruments catering to such fields as the automotive and aerospace industries. An important issue in this field is putting the Nikon Metrology NV business on track. The company's business foundation has been in Europe, and we plan to restructure and integrate the development, manufacturing and sales structures to expand sales channels in Japan and other Asian countries.

Q4:What are the strengths and focus for the Instruments Company?

A4:

In the instruments business, "precision" is an important keyword in a world that works at the micro and nano levels. For both biological microscopes and industrial instruments, ensuring performance that pushes boundaries is essential. We have attained and maintained this by developing, for example, in the case of biological microscopes, measurement instruments that accurately correct aberrations to enhance image quality, and in the case of industrial instruments, standard-scale measuring instruments with world-leading measurement capabilities. This consistent dedication to the highest levels of fundamental performance and precision is embedded in Nikon's corporate DNA.

Reflecting this, the Instruments Company has adopted a new mission statement, "Turning Vision into Information." We provide extremely precise images and data based on the advanced optical technologies we have accumulated over the years, and through this we seek to make many types of information available to customers. To address this, advancements in application software are essential.

The concept embodied in the mission statement indicates the direction of the Instruments Company to follow. We will steadily implement measures to realize this goal, and aim for further expansion of sales and improved earnings in the fiscal year ending March 2012.