Message from the President

To Our Shareholders and Investors

Let me begin by expressing my gratitude for your continued support of IBIDEN CO., LTD. and the IBIDEN Group.

During the fiscal year under review, the U.S. economy moved on a clear recovery trend and the European countries began to show signs of finally overcoming prolonged economic stagnation, while economic growth lost steam in the emerging economies. Given the continued weakness of the yen against the U.S. dollar, the Japanese economy moved on a moderate recovery path, led by export-oriented companies.

In the semiconductor/electronic components industry, smartphones and tablet-type devices continued to enjoy a high rate of growth and we reported brisk sales of components for these devices. In contrast, order intake for package substrates was weak, reflecting a drop in demand for personal computers.

The European automotive market began to show signs of recovery and the North American market remained healthy. As a result, the Ceramics Operation enjoyed buoyant sales of diesel particulate filters (DPFs), ceramic fibers and substrate holding mats (MATs).

In this environment, the IBIDEN Group launched its medium-term management plan; the “Challenge IBI-TECHNO 105 Plan,” pushed ahead with business structure reforms and carried out distinctive activities to improve on a worldwide basis and thereby reinforce its revenue base.

In the Electronics Operation, where new products faced intensifying competition, we stabilized the quality of mass-produced products by implementing preparations as planned and switching to new products seamlessly. In the Ceramics Operation, we worked to cut costs at our overseas bases. As a result, we succeeded in posting higher operating profit on larger net sales compared to the previous year.

In the fiscal year ending March 31, 2015, we expect competition to intensify globally in both the Electronics and Ceramics Operations.

In the Electronics Operation, the main growth driver of smartphones is shifting to lower-end products for the emerging markets and the demand is fluctuating significantly in line with the sales of such devices. To address these developments, we will boost our efforts to tap new clients and put in place an optimal production system at our plants in Japan and abroad, so that we can respond flexibly to changes in orders.In the Ceramics Operation, we aim to further expand new markets for our products, such as DPFs for large vehicles, ceramic fibers and MATs, and catalyst carriers for nitrogen oxide purification for thermal power plants.

In line with our medium-term management plan, we will direct our efforts to bolster our competitive advantages.

We thank you for your continued support and understanding of the Group.

June 2014
President & CEO
Hiroki Takenaka