To our shareholders
I would like to express my deep gratitude to all our shareholders for the kindness you have shown us.
In FY2017, Alpine strove to establish a strong foundation for its business through structural reforms based on the reorganization of its domestic technologies and production subsidiaries in accordance with its 14th Mid-term Business Strategy and through capital and business cooperation in the fields of navigation application software, HUD (head-up displays), aiming to achieve VISION 2020 (sales of 330 billion yen, and operating income rate of 5% in FY2020), which is its corporate vision enacted with the target year as 2020.
As for our business performance, we increased sales thanks to growth of sales of Alpine brand car-specific products to the after-sales market, and of OEM products to European auto makers using in Chinese products, and to depreciation of the yen. Operating income also increased thanks to progress in lowering fixed expenses through more efficiently using research and development costs in addition to the revenue increasing effects of exchange rates.
In the auto market where Alpine develops its business, a paradigm shift is occurring under the effects of a new trend called CASE (Connected, Autonomous, Shared & Services, Electric).
As technological revolution and competition between companies expands across boundaries between industries and fields of business, new relationships—those between people and mobility and between society and mobility—are coming into existence. In the midst of these changes, Alpine has, while watching the global marketplace, aggressively developed technologies and undertaken projects more aggressively than ever before to respond to CASE. And last year, in order to adapt to violent environmental change and continue medium and long-term growth, we announced a business integration plan with our parent company Alps Electric Co., Ltd., and began preparing for the establishment of Alps Alpine Co., Ltd. in January 2019. We are discussing the system and business strategy, so as to accelerate the business immediately after the new company is launched.
Through this business integration, we are counting on a variety of synergistic effects on the business side along with mutual use of our business resources which are our development resources and intellectual property, and the strengthening of corporate constitution through increased efficiency of back-office divisions. In the car-mounted business sphere, we will strengthen our ability to propose car-mounted HMI (Human Machine Interface) systems that future automobiles will demand by combining Alpine’s system technology, software technology, and Alps Electric’s entry devices, sensing devices and communication devices. This will permit us to respond at a high level to the advanced needs of the world’s auto makers who are the customers for our OEM business.
And in new business spheres, Alpine will aim to create new business models by utilizing not only the unique technologies it has built up through its audio products and information communication products businesses, but its experience of the brand business in the after-sales market in countries around the world, through the broad markets and customer channels that are embraced by Alps Electric.
In the middle of market reforms under the quaternary industrial revolution caused by AI and by big data, we will accept the challenge of realizing a value creating corporate group that will continuously contribute to people’s lives with electronics and communication centered on the electronics parts business and car-mounted information equipment.
The Alps Group is a company group with sales of 850 billion yen according to consolidated accounts. We will simplify the use of the rich business resources of Alps Electric and of Alpine and at the same time speed up decision making and accelerate our growth to expand our business to reach our goal which is to become a company with consolidated sales of 1 trillion yen.
I request that all our shareholders continue to honor us with your support and encouragement.