Striving to Create New Value. Konica Minolta s Potential is about to Become a Reality.

Transcription

1 Corporate Profile 2005

2 Introduction Striving to Create New Value. Konica Minolta s Potential is about to Become a Reality. The world of imaging is expanding and growing for image and video users, spurred by the continual evolution of the digital network society. Two years have passed since the Konica Minolta Group was launched with the aim to become an innovative enterprise group committed to creating inspiring new products and services in the field of imaging. Ensuring the foundations to create new value, we are now opening a new chapter and pioneering into the future of imaging. Our quest is to bring together diverse technologies, to become an innovative enterprise group dedicated to creating inspiring new products and services, and to evolve into a global enterprise group that leads the market by advanced technologies and reliability. Konica Minolta is promoting innovation with the potential to trigger evolution in all areas, including personnel, organization, technologies, and products. Konica Minolta is gaining momentum and is ready to prove itself in the days ahead. [Management Philosophy] The creation of new value [Management Visions] An innovative corporation that continues to create inspiring products and services in the field of imaging A global corporation that leads the market by advanced technologies and reliability [Corporate Message] * * The message represents our wish to be acknowledged as an essential company, by offering essential products, services and solutions to customers in the world of imaging. 01

3 CONTENTS Brand Essence Message from the President Group Formation [Business Companies] Konica Minolta Business Technologies, Inc. Konica Minolta Opto, Inc. Konica Minolta Photo Imaging, Inc. Konica Minolta Medical & Graphic, Inc. Konica Minolta Sensing, Inc. [Common Function Companies] Konica Minolta Business Expert, Inc. Konica Minolta Technology Center, Inc. List of Group Affiliates Global Activity Corporate Social Resporsibility (CSR) History

4 Brand Essence [Business Field] Imaging An Increasingly Sophisticated and Diversified Field Konica Minolta runs a wide range of imaging input/output businesses. Our business domain is broad, including office equipment, optical devices, digital photos, medical imaging, graphic imaging and measuring instruments. Konica Minolta is committed to exploring unique markets and creating new business opportunities focusing on digital input/output, as the possibilities of imaging expand with the progress in digitalization and networking trends. Office Equipment Optical Products Photo Imaging Medical Imaging Graphic Imaging Measuring Instruments Ink Jet Technology and more Konica Minolta s business domain spans from imaging input to output. We offer diverse products and services for new digital imaging environments in a wide range of fields, for both consumer and business purposes. We also actively develop cutting-edge technologies that will expand the world of imaging, concentrating on proprietary materials, optical, nano-fabrication and imaging technologies. Konica Minolta will continue to pursue technological innovations and synergies, and propose new value by creating inspiring products and services in the field of imaging. [Value] Always Bringing Fresh Surprises to Customers. Konica Minolta takes a strict stance to manufacturing and adopts a market-in approach to provide unique products and services capable of meeting the ever-changing, sophisticated needs of customers. All of our activities are dedicated to bringing fresh surprises and inspiring new products and services to our customers. Konica Minolta aims to become a company essential to the field of imaging by demonstrating its unique creativity and technological prowess in all business areas. Innovation Creation of New Functions Optimal Solutions Miniaturization & High Precision Bring Fresh Suprises to Customer Work-style Innovation Joy of Creation Pursuit of Comfort 03

5 [Technologies] Innovation through the Fusion of a Wide Range of Technologies Konica Minolta is developing technologies for an imaging input platform, an imaging output platform and an imaging input/output solutions, based on its four core technologies (i.e., materials, optical, nano-fabrication and imaging technologies) Konica Minolta will bring about unique innovations through an all-embracing technology comprised of a wide range of technological elements, spanning electric/electronic, optical, chemical, high-precision machining and software technologies. Imaging input/ output solutions Materials technology Optical technology Core Technologies Innovation Imaging input platform Nanofabrication technology Image technology Imaging output platform 04

6 Glass Substrates for Hard Disks Enabler of High-density Recording Based on Materials Development and High-precision Machining Technology Konica Minolta carries out materials development, melting, pressing and polishing in a consistent process, and provides heat-resistant, smooth glass substrates which enable the production of highdensity magnetic films. They help hard disks record at higher density and process large volumes of data at high speed. VIVID/VI Series 3D Digitizers Help Create Reproductions to Preserve Cultural Assets Konica Minolta s 3D digitizer did a fantastic job in helping to create a full-size model of the Altamira Cave in Spain. The task involved measuring the shape of the cave s wall surface spanning 2,600 square meters, covered with prehistoric wall paintings, and converting it into 3D data, as well as measuring the colors simultaneously. These data were then used to create a silicon model of the cave, with natural pigments used to reproduce the wall paintings. TAC Films for LCD Polarizers Superior Film Uniformity Enabled by Film Manufacturing Technology Liquid crystal displays (LCDs) are widely used in computers, television sets, mobile phones, car navigation systems, etc. TAC (triacetyl cellulose) film plays an important role in protecting LCD polarizers, which are the key components of LCDs. Konica Minolta develops and provides TAC films characterized by superior film uniformity and consistent quality, by capitalizing on the color film manufacturing technology it has nurtured over many years. Composition of Liquid Crystal Panel Polarizing plate Glass plate Color filter electrode LCD TFT/Electrode Glass plate Polarizing plate Back light TAC film Polyvinyl-alcohol polarizing element Retardation film/tac film Nano-imprint Technology Making Optical Elements with Smaller Structures than the Wavelength of Light Nano-imprint technologies, in which a mold having particular fine patterns engraved on its surface is pressed against a heated and softened material for form transfer, make it possible to manufacture low-cost optical devices by making many precise copies of the mold. Konica Minolta has developed the methods to efficiently transfer high-aspect-ratio patterns with subwavelength periods, realizing highly cost-effective polymeric devises such as optical components for CD, DVD and next-generation optical disks. Our nano-imprint technologies enable the production of polymeric finestructured devices with unique functions, which are hard to obtain with the conventional technologies. 05

7 Camera-Shake Compensation Mechanism Anti-Shake Effective Shake Compensation in Various Digital Cameras Konica Minolta s camera-shake compensation mechanism Anti-Shake is applied to various types of digital cameras. For example, the digital singlelens reflex (SLR) camera DYNAX 7D has a CCD-shifting system inside its body, which compensates for vibrations by moving the CCD. The slim portable model DiMAGE X1 owes its small size to the lens unit swinging system, which moves the lens unit integrated with the CCD. Micro Total Analysis System (µtas) Based on Proprietary Micropump and Micro-fabrication Technology µtas* has been attracting a great deal of attention in recent years, as a means for densification in chemical analysis, biochemical analysis, etc. Konica Minolta has developed a micropump that can accurately control tiny amounts of liquid, as well as a small plastic chip that has been processed through accumulation of reactive procedures as a minute channel. With the mounting of the micropump, Konica Minolta has also created a controller and detector system, which controls the movement of reagents and detects the reactions within the chips. These developments are applied to genetic testing systems in relation to infectious diseases. * µ TAS A system which integrates the functions of multiple instruments (analytical instruments, measuring instruments, etc.) on one small chip by using micro-fabrication technology. Konica Minolta Continues to Evolve towards Innovation, Lenses for Laser Printers Contributors to Smaller Printers and High-precision Output Konica Minolta s lenses are the fruit of advanced optical design technology and high-precision processing technology on a nanometer scale. They are installed in optical systems of laser color laser printers to help reduce the printer s footprint and contribute to high-resolution output. Optical Pickup Lenses for Next-generation Blue Laser Compatible with Both DVDs and CDs Konica Minolta supplies optical disks lenses which support both DVDs and CDs, by capitalizing on its ultra-high-precision aspherical plastic lens technology. For next-generation DVD using blue laser, we have developed and started mass-producing optical pickup lenses that are compatible with existing DVD and CD formats.

8 laser beam High-speed Polygon Motors Enabler of Copiers and MFPs with High Speed and High Image Quality The optical system that is emitting laser beams onto the photoreceptor drum is the key both the high resolution and the high speed of copiers. Konica Minolta designs and fabricates polygon mirrors*, which is the system s key optical device, and develops a proprietary air-driven roller bearing polygon motor with high precision and durability. Our MFP bizhub PRO1050 is equipped with a fast polygon motor (approx. 60,000 rpm) and can output as many as 105 sheets per minute. * Polygon mirror A rotating component with many reflective surfaces which are designed to reflect and scan laser beams and emit them onto the photoreceptor drum (i.e., writing). Structure of polymerized toner Color materials Wax 6.5µm bizhub PRO1050 Polymerized Toners Based on Emulsion Polymerization Method Meeting the Need for Multifunctional Peripherals (MFPs) and Printers with High Image Quality and High Speed Polymerized toners are best suited for prints of high image quality, and are superior in terms of environmental friendliness. Konica Minolta has realized lowtemperature fixing by applying a manufacturing process which involves mixing the resin particles based on the emulsion polymerization method* prior to coagulating and fusing them chemically with colorants, etc. This has enabled the toners to be loaded even in high-speed models. Various functions can be added to the toners by incorporating alternative elements into the resin particles. * Emulsion polymerization method A method of producing resin particles by dissolving emulsifying agents in water like soap, adding water-insoluble resin materials and mixing them together, and binding the molecules with the use of water-soluble initiators. Conventional toner Polymerized toner to Create Inspiring Products and Services. Mirror-type Rear Projection System Enabler of Thinner Micro Display Projection TVs (MD-TV) There is an increasing demand for thinner models in the growing MD-TV market. Making full use of the latest design and fabrication technologies, Konica Minolta has developed a mirror-type projection system, which realizes thinner rearprojection TVs and reduces chromatic aberration dramatically to a level almost undetectable by the human eye. Rear projection system Phase Contrast Technology Enabler of World-leading Mammography Image Quality Sharp images of objects with an emphasis on the edges can be acquired by exploiting the variations in image density (phase contrast) attributable to the refraction that occurs when X-rays penetrate objects (phase change). Konica Minolta developed the world s first digital X-ray mammography system (PCM system) that applies such phase contrast technology, making it possible to clearly capture pathologic changes which were difficult to see in conventional systems, such as the glandular structure and microcalcification.

9 Image Head-mounted Display A Lightweight, Transparent and Regularly Wearable Unit Wearable displays are drawing attention as devices which enable access to information wherever you are in the ubiquitous society. Konica Minolta has developed a lightweight head-mounted display which allows the wearer to see images without obstructing his/her view by applying holographic optical elements. It is expected to serve as a display that can be worn in everyday life. Piezo Print Heads for Inkjet Printers Realized Smaller and Faster Droplets Konica Minolta s inkjet print heads, driven by the shear mode piezo actuation mechanism, can handle a wide range of inks to meet various application requirements. Their optimized ink channel structure (pressure chamber) and nozzle shape make droplets smaller and faster, thus enabling high efficiency and high quality print engine. Magnified cross section of ink channel Cross section of print head Cross section of nozzle portion Integrated Planetarium System GEMINISTAR III Seamless Integration of Starry Sky Projection with Dynamic Full-dome CG Animation GEMINISTAR III is a planetarium system for large domes, characterized by an optical planetarium which completely synchronizes with a full-dome digital projection system. While making the most of the beauty of stars projected by the optical system, it can link the images with dynamic realtime computer graphics. GEMINISTAR III provides up-to-date scientific knowledge and excitement to the audience with unlimited visual expression which is far beyond the scope of conventional planetariums. Image by PCM system Image by conventional system 08

10 Message from the President Quest to Become a Market-leading Enterprise Group with a Strong Presence by Promoting Speed-oriented Portfolio Management. Promoting a New Growth Strategy after Establishing Management Foundations In March 2005, the Konica Minolta Group developed the V-5 Plan, a medium-term management plan for the four-year period from FY2005 to FY2008. The new management plan is an extension of the Medium-Term Integration Plan announced in March Now that we have mostly completed the task of establishing the business foundations after management integration, it is regarded as an important plan for the Group to forge ahead into a new phase of expansion and significant growth. The key strategy under the V-5 Plan is to consistently execute business portfolio management. As the market environment is changing dramatically, we will promote selection and concentration more aggressively and strive to enhance the competitiveness of our existing businesses. Further, we will bring about renewed growth through new business development and business expansion through mergers and acquisitions (M&A) and alliance with a vision for the future. The Konica Minolta Group aims to generate 1,410 billion in sales in FY2008 through such a growth strategy. President & CEO Fumio Iwai Enforcement of Selection and Concentration focusing on Office Equipment Business and Optics Business In existing businesses, we will continue to promote the genre-top strategy, i.e., creating products to capture the largest market share in growth fields and segments by demonstrating our strengths. In particular, the office equipment business and optics business are regarded as our priority fields. By expanding these businesses, we will further shift the Group towards a BtoB-oriented business structure. In the office equipment business, we will further increase profit by expanding the ratio of color MFPs* 1 and enhancing the cost competitiveness of the business. Specifically, we will expand our product lineup with new models of color MFPs by reinforcing our R&D framework, expand our direct marketing and dealership networks in major markets (Japan, Europe and the United States) and enhance our solution offerings targeted at corporate clients. Moreover, we plan to complete new production bases after the autumn of 2005, including an MFP and printer factory in Wuxi, China and some polymerized toner factories in Japan. We also expect further improvements in production capacity and cost competitiveness. 09

11 In the optics business, we will direct our efforts at optical pickup lenses, which have the largest market share in the industry, and our TAC films* 2 for LCDs, which are rapidly increasing in demand. We are striving to become the world s mightiest optical devices manufacturer by promoting further enhancements in technological prowess and supply capacity. * 1 MFP (multi-functional peripheral) A computer peripheral equipped with facsimile, printing and other various functions, in addition to copying. * 2 TAC (triacetyl cellulose) film A film for protecting the LCD polarizing plate. Developing New Businesses forming the Core of the Group s Future We will aggressively promote the creation of new businesses, in addition to enhancing existing businesses. The Konica Minolta Group has many technologies and expertise in the field of materials, optical, nano-fabrication and image. We believe we can expand and create various businesses in the field of imaging, from input to output, by effectively utilizing these core technologies. In January 2005, we launched a new company by way of spinoff from Konica Minolta Technology Center, Inc., whose mission includes new businesses development. The new company, Konica Minolta IJ Technologies, Inc., runs a business focusing on inkjet technologies and is now steadily expanding its business. Other promising new businesses include optical communication modules, next-generation storage units and other such optical devices in the input business; Organic Light Emitting Diodes (OLED) and other such display-related operations in the output business; and system solutions in the field of graphic and medical imaging. While determining market and technological trends, we will steadily build the foundations of these new businesses, and from among them, select and nurture businesses that will forge the Konica Minolta Group s future. Consolidated Sales (Target) Sales ,000 1,200 1,400 1,600 (billion yen) 1,410 Establishing Brands with a Presence in the Global Market We will make concerted efforts on a Group-wide scale to fulfill the V-5 Plan, with the commitment to focus on speed and respond promptly to changes in the environment, constantly carry out self-reform from the viewpoint of customers and thoroughly improve operational and cost efficiencies. By promoting such efforts, the Konica Minolta Group aims to become an innovative corporation that continues to create impressions in the field of imaging and a global market leader that offers advanced technology and reliability. We will also strive to further boost the recognition and positive impression of the Konica Minolta brand in the global market through our products and services. We will improve the brand s value by establishing our image as a young, unique, lively and innovative company. Accordingly, it goes without saying that the Konica Minolta Group must remain highly trustworthy in the eyes of the general public. The Group will thus reinforce its corporate governance and compliance structures and fulfill greater Corporate Social Responsibility (CSR) as a growth company through active communication with various stakeholders. We look forward to your continued support and assistance to Konica Minolta. Consolidated Operating Income/Operating Margin (Target) Operating Income (billion yen) (Target) 1, (Target) (Target) 1, (Target) (Target) 1, (Target) , (%) Operating Margin 10

12 Group Formation Quest to Become an Innovative Enterprise Group that Continues to Create Inspiring Products and Services in the Field of Imaging. Konica Minolta Group consists of five business companies and two common function companies with a holding company. While fusing together their respective strengths, we will demonstrate synergies as an innovative enterprise group and create new value demanded by the market. Holding Company It governs the entire Group as the holding company; it is responsible for the planning and promotion of management strategies for the Konica Minolta Group, which consists of five business companies and two common function companies, and for the audit and administration of the Group s management. Location of head office Business activities Number of employees Marunouchi, Chiyoda-ku, Tokyo Holding company (Planning and promotion of the Group s management strategies, audits of the Group s management and other management & administration tasks of the Group) Number of employees 90 (as of March 31, 2005) Profile of Konica Minolta Group Established Paid-in Capital Consolidated sales in FY2004 December 22, ,519 million yen (as of March 31, 2005) 1,067.4 billion yen Outstanding shares Fiscal Year End Number of employees (consolidated) 531,664,337 shares (as of March 31, 2005) March 31 Approx. 33,400 (as of March 31, 2005) Corporate Governance Konica Minolta Group adopts a company-with-committee system. The aim is to enhance its managerial supervision functions, accelerate the managerial decision-making process and the execution of operations, and build a fair and highly transparent management framework. The Board of Directors does not make decisions on the execution of daily operations, but engages in appropriate management by concentrating on the managerial supervision functions and on decision-making of basic management policies and other essential issues. Executive Officers, who are delegated the authority to execute operations, assume full responsibility for businesses assigned to them individually under the leadership of the President & CEO, and strive to improve operating revenue. No Director who concurrently serves as the CEO is appointed to a member of the Nominating Committee (which decides on candidates for Directors), the Compensation Committee (which decides on the remuneration of Directors and Executive Officers) or the Audit Committee. Outside directors account for the majority of members of the three committees, in the interests of ensuring transparency of management. * Audit Committee* Audit General Meeting of Shareholders Election Board of Directors Compensation Committee* Election Chief Executive Officer Executive Officers Nominating Committee* Each of the three committees consists of at least three Directors. Outside Directors constitute the majority of members. Role of Committees Nominating Committee Nominates candidates for Directors for the next term, to be elected at the general meeting of shareholders. Compensation Committee Decides the remuneration of Directors and Executive Officers. Audit Committee Performs management audits in place of auditors under the conventional system. 11

13 Business Companies We have spun off each and every business into a separate company, and delegated the authority required for executing operations to each business company. This has enabled us to build a framework characterized by flexible and speedy operational execution and business promotion. Location of head office Business activities Paid-in capital Consolidated sales in FY2004 Number of employees (consolidated) Marunouchi, Chiyoda-ku, Tokyo Manufacturing, sale and related services of office equipment (copiers, digital MFPs, printers, facsimile machines, micrographics systems, etc.) and related supplies. 500 million yen billion yen Approx. 19,600 (as of March 31, 2005) Location of head office Business activities Paid-in capital Consolidated sales in FY2004 Number of employees (consolidated) 2970 Ishikawa-machi, Hachioji, Tokyo Manufacturing and sale of optical products (optical pickup lenses, microcamera units, etc.), related products and electronic materials (such as TAC films). 500 million yen 91.7 billion yen Approx. 2,600 (as of March 31, 2005) Location of head office Business activities Paid-in capital Consolidated sales in FY2004 Number of employees (consolidated) Nishishinjuku, Shinjuku-ku, Tokyo Manufacturing, sale and related services of digital cameras, film cameras, consumer & commercial photographic materials, ID photos, inkjet media and related equipment. 500 million yen billion yen Approx. 6,100 (as of March 31, 2005) Location of head office Business activities Paid-in capital Consolidated sales in FY2004 Number of employees (consolidated) Nishishinjuku, Shinjuku-ku, Tokyo Manufacturing, sale and related services of film and processing equipment for medical & graphic imaging purposes. 500 million yen billion yen Approx. 2,700 (as of March 31, 2005) Location of head office Business activities Paid-in capital Consolidated sales in FY2004 Number of employees (consolidated) 3-91 Daisennishimachi, Sakai, Osaka Manufacturing and sale of measuring instruments for industrial, photographic and medical purposes. 495 million yen 5.3 billion yen Approx. 230 (as of March 31, 2005) Common Function Companies We have consolidated Group-wide functions (such as technological development functions and common service functions) into two common function companies. This has enabled us to promote businesses more efficiently. Location of head office Business activities Paid-in capital Number of employees (consolidated) 2970 Ishikawa-machi, Hachioji, Tokyo Provision of various management support and indirect function services, such as production facilities, logistics/procurement, environment/safety, export management, general affairs, personnel affairs, accounting, etc. within the Group. 495 million yen Approx. 1,400 (as of March 31, 2005) Location of head office Business activities Paid-in capital Number of employees (consolidated) 1 Sakura-machi, Hino, Tokyo Constracting of R&D and design, promotion of commercialization of new technologies, and provision of intellectual property management/administration services within the Group. 50 million yen Approx. 600 (as of March 31, 2005) 12

14 Group Formation Offering Document Solutions for Evolving Office Environments Focused on Color, Digitalization, High-speed and Networking. President Yoshikatsu Ota Konica Minolta Business Technologies, Inc. runs an office equipment business, which is the Group s core business. We provide the light production printing, office and Small Office Home Office (SOHO) markets with our copiers, digital multi-functional peripherals (MFPs), printers and other office equipment that make the most of our cutting-edge optical and imaging technologies. The growth in the networking of businesses in recent years has spurred the demand for office equipment with greater efficiency and coordination performance. This has prompted us to enhance software development, including the development of applications which link together various kinds of equipment, and to offer security systems indispensable in network environments. We have realized a business platform suitable for the age of ubiquitous computing. We will continue to promote the genre top strategy aimed at establishing our presence in each product field as an industry leader, by concentrating our resources in the increasingly flourishing area of color printing and by providing value-added products with excellent image quality which draw upon our strengths. Major Affiliates Sales Konica Minolta Business Solutions U.S.A., Inc. Konica Minolta Printing Solutions U.S.A., Inc. Konica Minolta Business Solutions Europe GmbH Konica Minolta Printing Solutions Europe B.V. Konica Minolta Business Solutions Japan Co., Ltd. Konica Minolta Printing Solutions Japan Co., Ltd. Manufacturing Konica Minolta Business Technologies Manufacturing (HK) Ltd. Konica Minolta Supplies Manufacturing Co., Ltd. Konica Minolta Business Technologies (WUXI) Co., Ltd. 13

15 Multi-functional Peripherals (MFPs) Pursuing Advanced Imaging Markets Ranging from General Office to Light Production Printing. Konica Minolta s digital MFPs branded the bizhub series are equipped with multiple functions (copying, printing, scanning, etc.), and supports businesses by playing a key role in the network environment of offices. For example, they can consolidate the administration of office equipment connected to a network by using a series of network management software programs, manage and share various documents in an integrated fashion, and offer advanced security functions. They are also equipped with an integrated firmware (control software) which standardizes the settings and the user interface of different types of equipment and makes it easier to develop software. Their color output boasts the highest image quality and speed in the industry, and leads the office equipment market where the boundary between color and monochrome products is blurring. These MFPs also substantially help improve productivity and creativity in the office. In the light production printing market, one of our important target markets, we help improve operational efficiency by providing high-speed high-definition monochrome copiers and MFPs with superior durability and which are best suited to print on demand (POD). Laser Printers Advanced Generation of Compact, Lightweight and High-performance Color Laser Printers Creating New Markets. The market for color laser printers continues to expand, fueled by the rapid shift of business documents from monochrome to color. Konica Minolta s array of products feature both superb image quality and compact design, as demonstrated by the magicolor 2400 series, which have won high acclaim including receiving the 2005 Pick of the YEAR award from Buyers Laboratory Inc.* (USA). They are used in a wide range of environments, from general offices to homes. We plan to further tap into markets in Europe and the United States, where we have already established a strong presence. We will develop the markets in China, where the market for color printers is rapidly expanding, and in Japan, where demand is increasing in the SOHO market. * Products Buyers Laboratory Inc. An independent evaluation organization specializing in office equipment for business users in the United States. Full color MFP bizhub C450 High-speed monochrome copier/mfp bizhub PRO 1050 A4 color laser printer magicolor 2430 DL TECHNOLOGY FOR THE F UTURE Next-generation Toner Pioneering into the Future of Rich Imaging. Konica Minolta adopts proprietary polymerized toners (SIMITRI Toner) for new products in all segments, i.e., copiers, MFPs and printers, including color models. Polymerized toners are characterized by the smaller diameter of toner particles and the greater uniformity of their size and shape formed by chemical reactions in the toner production process. These characteristics make it possible to print fine lines, small text, photos and graphics in smooth halftones with enhanced sharpness. Their image quality is high and printouts are sharp especially in color. Mixing wax in each toner particle allows oil-free fixing, making it possible to write on paper and even paste sticky notes on it. Konica Minolta s polymerized toner has been highly praised as an environmentally-friendly toner of the next generation, as the level of carbon dioxide (CO2), nitrogen oxide (NOx) and sulfur oxide (SOx) released in the toner manufacturing process is approximately 40% lower than conventional toners. Polymerized toner Conventional toner 14

16 Group Formation Meeting Customers Expectations through Synergies of Advanced Technologies as the World s Mightiest Optical Devices Manufacturer accelerating Market Growth. President Takashi Matsumaru Konica Minolta Opto, Inc. has been engaged in the optics business relating to optical pickup lenses, lens units and microcamera units, and in the optical electronics materials (OE) business specializing in triacetyl cellulose (TAC) films for protecting polarizers used as core components of LCD displays. Both are positioned as strategic businesses within the Konica Minolta Group, targeted at the expanding digital consumer electronics market. In order to meet the growing expectations in the market, our policy is to maintain our reputation as the world s mightiest optical devices manufacturer. We will accomplish this by further refining our proprietary optical, image evaluation and highprecision machining technologies and thin film creation technologies, and by offering advanced, highly value-added optical units and electronic materials through the synergies of various technologies, including the fusion of our superior plastic lens technology and glass molded lens technology. We are committed to fulfilling our mission as the global market leader, by further promoting technological innovation and by pursuing sophisticated technological synergies based on enhanced cooperation between companies in the Konica Minolta Group. Affiliates Manufacturing Konica Minolta Components Co., Ltd. Konica Minolta Opto Products Co., Ltd. Nankai Optical Co., Ltd. Konica Minolta Glass Tech. Co., Ltd. Konica Minolta Opto (DALIAN) Co., Ltd. Konica Minolta Opto (SHANGHAI) Co., Ltd. 15

17 Products Optics Advanced Optic Products Derived from the Synergies of Core Technologies. In the optics business, we have been developing pickup lenses for DVD, MD and other optical disk drives and players, since we successfully became the world s first in commercializing aspherical plastic lens for CDs. Today, our products backed by our proprietary optical design technology, precision mold machining technology and other cutting-edge technologies have the largest share in the global market. We are also actively expanding our business in pickup lenses for next-generation optical disks using blue laser diodes. In the field of microcamera units for mobile phones with camera functions, noteworthy for their ever-improving image quality and functions, we have developed highly value-added micro lenses with superior light uniformity and color reproduction properties. Our other developments include pickup prisms, lenses for laser printers, lens units for digital cameras, glass hard disk substrates and other products with high precision requirements, winning the confidence of a wide range of customers. Lens unit Microcamera unit Multiple AF unit Optical Electronics Materials (OE) Materials Technology Our Fruit in the Ever-expanding LCD Display Market. In the OE business, we are developing 40-micron thin TAC films for protecting LCD polarizers, by taking advantage of our extensive experience in film production technology. We are also further expanding our production capacity to meet the increasing demand for TAC film spurred by the penetration of LCD displays and the growth of the widescreen LCD market. We will continue making R&D efforts for more advanced electronic materials, capitalizing on our superior core technologies, including thin-film and coating technologies. TECHNOLOGY FOR THE FUTURE Integrating Advanced Technologies Supporting World-standard High-quality Lenses. Konica Minolta s pickup lenses for optical disks boast a dominant market share. Their quality rests on optical design technology the fruit of all-out efforts made by the Konica Minolta Group. Such advanced, highly value-added optical products could not have been produced consistently without Konica Minolta s proprietary technologies, such as the plastic molding technology (for highprecision shapes and forms which are indispensable in the production of ultraprecise optical elements such as lenses and prisms), precision mold machining technology (for making smooth surfaces), optical materials evaluation technology, measurement & evaluation technology (for optical performance), and optical thin film (coating) technology. Our efforts are directed at developing cutting-edge technologies by further improving these technologies, including blue laser pickup lenses with stricter precision requirements. 16

18 Group Formation Creating a New World of Photo Imaging for Greater Dreams and Inspiration with Products and Services Fit for the Digital Network Society. President Tsuyoshi Miyachi Ways to enjoy personal photography have been diversifying since the Internet and camera-equipped mobile phones became a part of our lives. Within the Konica Minolta Group, Konica Minolta Photo Imaging, Inc. is the sole supplier of products and services for individual consumers. We provide a wide range of high quality products and services, including digital cameras, online printing services, image storage, various printing services, minilab and ID photos drawing upon our extensive experience in advanced optical technologies and image processing technologies. We are expanding the possibilities of the world of digital photo imaging-from image input to output-to boost the value of the Konica Minolta brand. We are committed to pursuing customer satisfaction and proposing a new world of photo imaging for new dreams and inspiration, by providing highly value added, unique products and services fit for the digital network society, together with silver halide film and cameras cherished by customers worldwide. Major Affiliates Sales Konica Minolta Photo Imaging U.S.A., Inc. Konica Minolta Photo Imaging Europe GmbH Konica Minolta Photo Imaging (UK) Ltd. Konica Minolta Photo Imaging France S.A.S. Konica Minolta Marketing Corporation <Japan> Konica Minolta Photo Solutions Co., Ltd. <Japan> Konica Minolta Photo Imaging (HK) Ltd. Konica Minolta Photo Imaging Asia H.Q. Pte. Ltd. Konica Minolta Photo Imaging (SHANGHAI) Co., Ltd. Konica Minolta Photo Imaging Australia Pty. Ltd. 17

19 Products Digital Cameras A Provider of High Value-added Products Featuring Unique Technology. In the digital camera market, Konica Minolta offers a lineup of high valueadded products featuring unique technology. One of such unique technologies is our proprietary camera-shake compensation mechanism called Anti-Shake Technology. Our digital single-lens reflex (SLR) camera DYNAX 7D* 2 (winner of the Camera Grand Prix* ) and its sister model DYNAX 5D both have the Anti-Shake technology built into their respective bodies, to compensate for vibrations and movements in all DYNAX lenses.* 3 Our compact digital camera DiMAGE X1 has a stylish slim body and boasts advanced functionality, by combining a flat zoom mechanism (zero lens protrusion when zooming in) with a new Anti-Shake mechanism tailored to its slim shape. * 1 Camera Grand Prix An award presented by the Camera Press Club to the best model released in Japan during the year. * 2 DYNAX series SLRs are marketed as the Maxxum series in North America and the series in Japan and China. 3 Excluding AE Macro Zoom 3X-1X * Digital SLR camera DYNAX 7D Compact camera DIMAGE X1 Digital Photography Digital Photo Services Providing Diverse Solutions. Konica Minolta offers a wide range of digital photo services in the everexpanding world of digital imaging. We are rolling out various services and tools for enjoying digital images. For example, we provide HOT ALBUM in Japan, a tool that enables users to easily organize images and videos taken by digital cameras and store precious images safely. In addition, we are expanding our printing and image storage services with the use of the network environment and the internet in Japan and overseas countries. Storage tool for digital images HOT ALBUM In the minilab field, we offer diverse services via networks, centering on a fully digital minilab equipped with a newlydesigned exposure engine. We also provide self-service-type photo printers for convenient image printing, and inkjet papers enabling photo-grade, high-quality prints at home. These are only some of our diverse solutions to the world of consumer imaging. Other Running Various Photo-related Businesses Backed by Advanced Technological Prowess. Konica Minolta s silver halide technology is backed by the established and superior technological prowess. It is applied to films and photo prints, and even digital camera photography, etc. Additionally, in the ID photo business (our market share is about 50% in Japan), we promote aggressive digitalization efforts. We are also actively expanding into the business of photo ID cards-noteworthy for their growing importance in personal information management. TECHNOLOGY FOR THE FUTURE Anti-Shake Technology expanding the Frontiers of Imaging. The Konica Minolta DYNAX 7D is the world s first digital SLR with interchangeable lenses and a body armed with a built-in camera-shake compensation mechanism, called Anti-Shake Technology. Unlike lens-based optical systems, Anti- Shake moves the CCD within the camera body to create sharp handheld images. Without the need of intrusive equipment such as a flash or tripod, Anti-Shake assists photographers in demanding situations in low-light, telephoto, or macro photography. Anti-Shake compensates for both small hand vibrations and larger body movements. The Anti-Shake Technology won the European Photo Innovation of the Year award from EISA* for expanding the frontiers of imaging. * EISA European Imaging and Sound Association. An organization consisting of leading magazines specializing in photography, video, audio, etc. in Europe (50 magazines in 20 countries). CCD-shift type Anti-Shake mechanism 18

20 Group Formation Creating New Value by Providing Solutions based on Cutting-edge Image Processing Technologies in the Increasingly-digitized Medical and Graphic Imaging Fields. President Kiyofumi Tanida Konica Minolta Medical & Graphic, Inc. runs its business with the mission to provide equipment, network systems and consumable that enable highquality imaging and help improve the quality of medical systems and graphics culture. Driven by the rapid progress of digitization in recent years, we have been concentrating our efforts in the business of high-value-added solutions in both medical and graphics imaging fields. In the medical imaging field, our business has a vision for future medical systems, including building regional medical network systems, telediagnosis, etc. based on highresolution digital image readers and output devices that draw upon our reputable technology and track record in radiographic image processing. We are also promoting the development of pharmaceutical products for diagnostic purposes, considering the possibilities of life science. In the graphic imaging field, we provide digital color-proofing systems, etc. that take advantage of our advanced technology and expertise, and aggressively make efforts in the development of next-generation CTP (computer to plate) systems, whose market is rapidly growing. We will continue to release cutting-edge technologies in both medical and graphic imaging fields and offer more high-quality products and services. Major Affiliates Sales Konica Minolta Medical Co., Ltd. Konica Minolta Graphic Imaging Japan Co., Ltd. Konica Minolta Medical & Graphic Technosupport Co., Ltd. Konica Minolta Repro Co., Ltd. Konica Minolta Technoproducts Co., Ltd. Konica Minolta Graphic Imaging U.S.A., Inc. Konica Minolta Medical Imaging U.S.A., Inc. Konica Minolta Medical & Graphic Imaging Europe GmbH Konica Minolta Medical & Graphic (SHANGHAI) Co., Ltd. 19

21 Products Medical Imaging Helping to Build New-generation Diagnosis Systems with Reliable and Proven Products. Practitioners have placed a great deal of confidence in Konica Minolta s medical imaging products since we released the first made-in-japan X-ray film. Prompted by the progress in digitization and networking in recent years, we have developed X-ray image digitization, storage & transmission systems and enabled open network systems and efficient image management. Practitioners speak highly of our high-resolution diagnostic imaging systems, especially our digital image readers (direct digitizers) in the REGIUS series, and our digital image output devices (laser imagers) in the DRYPRO series. We also contribute to building next-generation diagnosis systems by developing Picture Archiving and Communication System (PACS) and other such software, as well as promising products linked with electronic clinical records. In the field of pharmaceuticals for diagnostic purposes, we contribute to high-quality medical care by providing intravascular contrast agents for X-rays and develop a genetic testing system for infectious diseases in collaboration with another company. Digital image reader REGIUS Vstage MODEL 190 Graphic Imaging Leading the Graphic Imaging Market by Providing Digital Solutions. In the field of graphic imaging, the digitization trend has increased the need for further improvements in quality and work efficiency in the production of graphics. Our customers highly praise the Konsensus series, for setting the standard for the new generation of color-proofing output systems. These systems can directly output digital data for color-proofing purposes, and can improve operational efficiency, cut costs and reproduce high-quality images. For plate making, we help improve productivity by making aggressive efforts in the business of computer to plate (CTP) systems, which expose digital data of text, images, etc. directly to plate materials without outputting them to films. Digital color-proofing system Digital Konsensus Pro TECHNOLOGY FOR THE F UTURE Phase Contrast Technology Paving the Way for Early Detection of Breast Cancer. Breast cancer is a disease with a better chance for a cure if detected and treated early. Detection of cancer in the microscopic stage has traditionally relied on analog photography. Digital diagnosis based on phase contrast technology is effective in showing the outline of objects sharply, but its application to the human body was previously too difficult, partly due to the massiveness of the machine. Konica Minolta has pioneered the development of the world s first mammography unit that applies this technology to medical mammograms. The unit has paved the way for digital diagnosis with minimal burden on the patient, as it can generate highresolution images (approx. 70 million pixels) by combining a high-precision image reader and an output device. We also encourage women to have a healthy future through our sponsorship of the Pink Ribbon Campaign,* aimed at promoting the early detection and treatment of breast cancer. * Pink Ribbon Campaign Enlightenment activities aimed at encouraging early detection, diagnosis and treatment of breast cancer. Mammography unit Mermaid 20

22 Group Formation Helping to Improve Quality Control and Precision Essential for Various Industries by Offering High-Precision Measuring Instruments Based on Optical & Image-Processing Technologies. President Hiroshi Furukawa Konica Minolta s measuring instruments are the fruit of cutting-edge optical and image-processing technologies. They help improve quality control and precision in various industries for example, our display color analyzers for measuring the color and luminance of displays, and spectrophotometers, colorimeters and other color measuring instruments used for essential color management in many manufacturing plants play important roles in supporting various manufacturing industries, and together form the core of our company s business. Our efforts are currently focused on the field of 3D measurement. We are implementing new products in this field by drawing upon our proprietary technologies, as demand is expected to rise, for industrial applications requiring high precision and advanced functions in particular, and also for medical and academic applications which already utilize our instruments. In addition to the above, our customers highly praise our medical measuring instruments, photometers and various other products that take advantage of optical technologies. We will continue to provide solutions to meet diverse needs through ever more advanced sensing technology and highvalue-added services. Products 3D Measurement Providing High-Precision, High-Speed, Non-Contact Scanning With Simple Operation. 3D digitizers scan three-dimensional objects and import the 3D data into computers. They fulfill customers purposes in a wide range of fields, thanks to their ability to perform high-precision, high-speed scanning of threedimensional shapes without contact through simple operation. Our future efforts will be directed at industrial applications such as reverse engineering, design verification and quality inspection, in addition to medical & academic research, 3D archiving and computer graphics production. Non-Contact 3D digitizer VIVID 9i/VI-9i Color Measurement High-Precision Color Measurement Technology Playing an Active Role in All Sectors of Industry. The expanding market for widescreen TV sets (plasma, LCD, etc.) and LED products is pushing up the demand for display color analyzers used for measuring the color of light sources. Konica Minolta s products can measure color, luminance and white balance with high precision for the inspection and adjustment of white balance and contrast. As color reproduction is a vital element for manufacturers engaged in the fierce competition over image quality, our products provide powerful assistance to manufacturers in the areas of R&D and quality control. Our spectrophotometers and colorimeters are capable of measuring and quantifying differences in color shades more subtle than the human eye can distinguish accurately. For this reason, they are widely utilized for measuring the color of objects by R&D, quality control, distribution and sales staff in many manufacturing sectors where color management is indispensable, including the automotive, paint, plastic, textile, construction materials and food industries. Display Color Analyzer CA-210 Spectrophotometer CM-2600d Other Areas Providing Products based on Optical Technologies in Various Fields. We provide the medical field with testing equipment that impose minimal burden on patients. This includes the pulse oximeter, which detects oxygen saturation in the blood simply by projecting light on the human body, and the compact Jaundice Meter, which can test newborn babies for jaundice without taking blood samples. Other Konica Minolta s products are utilized in a wide range of fields, notably photographic meters, which enjoy a high reputation among professional photographers, and radiation thermometers. Pulse Oximeter PULSOX-300 i 21

23 A Team of Experts in Shared Administration Functions for Corporate Activities, Helping to Maximize Corporate Value and Management Efficiency by Providing High-value-added Services to Both Inside and Outside Konica Minolta Group. President Mitsuharu Oura Konica Minolta Business Expert, Inc. is in charge of administration tasks, such as those concerning personnel affairs, accounting, logistics, production facilities, procurement, environment/safety and information systems in the Konica Minolta Group. It also plays an important role in spreading the concept of corporate governance (a basic element of activities relating to Corporate Social Responsibility (CSR)) throughout the Group. In other words, our mission is to help improve corporate value and management efficiency by supporting the business activities of companies within the Group from various angles. To fulfill this mission, we direct our efforts at developing strategies to practice and implement CSR, and training business experts capable of providing more specialized services, such as building the corporate infrastructure including personnel, facilities, finance and information frameworks. Each and every one of our staff strives to advance and share his/her expertise through daily endeavors and by close communication with the Group s companies. We are also reinforcing our alliances with specialty companies outside the Group, in an effort to improve service quality and mobility. We will establish a business model as a shared service provider based on a new concept through such efforts. Based on this, we will strive to become an independent company and create Groupwide synergies by aggressively expanding sales outside the Group and by feeding back the new externally-acquired expertise to the Group. Promoter of CSR striving to Maximize Corporate Value of the Group as a Whole. In recent years, companies have been urged to fulfill their CSR, including establishing corporate governance and compliance frameworks and tackling employment, human rights and environmental issues. The Konica Minolta Group also attaches much importance to CSR and strives to carry out business activities harmoniously in all aspects, including being socioeconomically sound, and giving due consideration to environmental protection. As the driving force behind the Group s CSR activities, Konica Minolta Business Expert, Inc. spreads the idea of CSR, the action policies, etc. throughout the Group. It also builds frameworks and gives guidance, assistance, etc. to implement the idea of CSR concretely, in order to improve the corporate value of the Group as a whole. We also actively disclose information and facilitate communication for the Konica Minolta Group to demonstrate our accountability to a wide range of stakeholders, including producing and issuing CSR reports. Assisting Improvements in the Group s Managerial Efficiency by Developing Information Infrastructure and Training Personnel. We are promoting the development of an extensive IT network environment to serve as an information infrastructure supporting the Group s management. Our priorities include building a system for sharing knowledge and information on a Group-wide scale and digitizing business procedures to shorten the time taken from R&D to sales. We train business experts in each division, improve the efficiency of practical operations by taking advantage of IT communications, and provide support to indirect administration divisions. All of our efforts described here help maximize the Group s managerial efficiency. Affiliates Konica Minolta Sogo Service Co., Ltd. Konica Minolta Logistics Co., Ltd. Konica Minolta Information System Co., Ltd. Konica Minolta Engineering Co., Ltd. 22

24 Group Formation Creating the Future of Imaging by Promoting Cutting-edge Technological Research and New Business Incubation as Konica Minolta Group s R&D Center. Deeply Plowing and Advancing Basic Technologies Common to Business Units. Konica Minolta Technology Center, Inc. is deeply plowing and advancing basic technologies common to business companies within the Konica Minolta Group, based on the core technologies i.e., materials, optical, nano-fabrication and imaging technologies. We actively pass on technologies that directly lead to product development to each business company, in an effort to boost the technological capabilities of the Konica Minolta Group as a whole. President Masatoshi Matsuzaki Konica Minolta Technology Center, Inc. helps business companies within the Konica Minolta Group to develop products by advancing basic technologies common to their businesses. We also promote activities cutting across individual business units, including developing new technologies and incubating new businesses with a vision for the future. One of our crucial missions is to promote intellectual property strategies and to function as a design center. We secure and utilize intellectual property rights in the element technology stages and build designs based on forecasts of society, and carry out other such activities from a Group-wide perspective. Now, the world is about to experience dramatic changes, in face of growing environmental awareness and the emerging ubiquitous computing society. With the mission to contribute to social progress through the practical application of research accomplishments, we are committed to serving as the driving force behind the Konica Minolta Group, to make further progress in the world of imaging. Developing Cutting-edge Technologies Cutting Across Individual Business Units and Incubating New Businesses. Our efforts are directed at developing element technologies and composite technologies with the potential of turning into a next-generation platform cutting across individual business units, based on our existing technology portfolio. Aggressive efforts are also being made to incubate new businesses using established technologies, the first being Konica Minolta IJ Technologies, Inc., a company established in January 2005 to run businesses focused on inkjet technology. We are also working on technological developments with business potential, including OLED (Organic Light Emitting Diode) materials for display purposes, which are notable for their promising range of applications, and display components which draw upon materials and thin-film coating technologies, and Intelligent Eye, a remote monitoring system with functions similar to the human eye that can recognize and identify the shape and quantity of objects. Imaging Culture Research Institute Pursuing Imaging in the Ubiquitous Computing Society. The Imaging Culture Research Institute was established for the purpose of conducting studies and research on changes in lifestyles and business-styles in the forthcoming ubiquitous imaging society. The Institute conducts research on Koto Idea focusing on consumers lifestyles and values rather than objects, invites outside researchers to contribute their research papers and engages in joint research. Its aim is to create new value bringing fresh inspiration to customers, by making recommendations based on the accomplishments of such research that will lead to new technological developments and business expansion within the Group. Affiliates Konica Minolta Technosearch Co., Ltd. Konica Minolta Technology U.S.A., Inc. 23

25 Expanding Our Business in the Rapidly-expanding Industrial Inkjet Printers Market, Capitalizing on Materials Technology and High-precision Machining Technology. Location of head office Business activities 1 Sakura-machi, Hino, Tokyo Manufacturing and sale of print heads (for industrial inkjet printers) and textile print systems. Paid-in capital Number of employees (consolidated) 10 million yen Approx. 120 (as of March 31, 2005) President Akiyoshi Ohno Konica Minolta IJ Technologies, Inc. was established in January 2005 as the first business company spun off from Konica Minolta Technology Center, Inc., whose mission includes the fostering of next-generation businesses. With inkjet technology at the core, we provide inkjet print heads according to customers diverse needs, by taking advantage of proprietary chemical & ink technologies acquired through the development and production of photothermographic materials. We also run a textile printer business utilizing these technologies. Printers for large-sized papers for printing the graphics of advertising displays and construction materials currently dominate the high-speed, highresolution inkjet printers market. They are expected to have a wide range of industrial applications in the future, including display production and biotech applications. We are committed to promptly meeting customers diverse needs by making the most of our proprietary technologies. Products Inkjet Print Heads Flexibly Dealing with Various Industrial Applications based on Proprietary Inkjet Technologies. Konica Minolta s proprietary high-performance piezo inkjet head is one of the company s most competitive products. Unlike thermal systems which apply heat, it applies a voltage to change the shape of the piezo element to push the ink out. This mechanism allows the use of various types of inks, including solvent, oil-based and UV curing inks. Our lineup of print heads is wide ranging, from those for high-speed printers for large-sized papers to those for high-resolution printers of professional-printing grade, and are supplied to and utilized in a wide range of industries and sectors. Print head Inkjet Textile Printers Advanced Textile Printing Technology For Large-variety, Small-lot Production. Digital inkjet textile printing systems are attracting a great deal of attention for their innovative dyeing technology, which eliminates the need for plate-making and mixing of color pastes to enable the speedy production of a wide range of products in small lots. Textile printer Nassenger V adopts this technology to enable high-speed processing and to bring out the sharpness and high concentration of colors, with its newly developed, small-droplet, high-density, multiple-nozzle inkjet head, used in combination with durable textile inks with high color saturation properties. It draws upon our proprietary materials technology and color management technology to reproduce smooth gradations and subtle variations in color tones in a wide range of fabrics of various thickness, even stretch fabrics used in swimming costumes. We are now promoting this product in Italy and other markets in Europe, as well as in Japan. Textile printer Nassenger V 24

26 Group Formation List of Group Affiliates Affiliates of Konica Minolta Holdings, Inc. Japan Konica Minolta IJ Technologies, Inc. Konica Minolta Planetarium Co., Ltd. Asia/Pacific Konica Minolta (CHINA) Investment Ltd. North and South America Konica Minolta Holdings U.S.A. Inc. Konica Minolta Headquarters North America, Inc. Affiliates of Konica Minolta Business Technologies, Inc. Japan Konica Minolta Business Solutions Japan Co., Ltd. Konica Minolta Printing Solutions Japan Co., Ltd. Konica Minolta Supplies Manufacturing Co., Ltd. Toyohashi Precision Products Co., Ltd. Sankei Precision Products Co., Ltd. Konica Minolta Supplies Manufacturing Kansai Co., Ltd. F&M Imaging Technology Co., Ltd. Konica Minolta Techno Tokyo Co., Ltd. Konica Minolta Software Laboratory Co., Ltd. Asia/Pacific Konica Minolta Business Technologies Manufacturing (HK) Ltd. Konica Minolta Business Technologies (WUXI) Co., Ltd. Konica Minolta Consulting (SHENZHEN) Co., Ltd. Konica Minolta International Trading (SHANGHAI) Co., Ltd. Konica Minolta Business Solutions (WUHAN) Co., LTd. Konica Minolta Business Solutions (HK) Ltd. Konica Minolta Business Solutions (S) Pte. Ltd. Konica Minolta Business Solutions (M) Sdn. Bhd. Konica Minolta Business Solutions Australia Pty. Ltd. Konica Minolta Printing Solutions Asia Pty. Ltd. Konica Holdings Australia Pty. Ltd. A.B.E. Rentals Pty. Ltd. K.B.A. Properties Pty. Ltd. Apeco of Australia Pty. Ltd. North and South America Konica Minolta Business Solutions U.S.A., Inc. Konica Minolta Printing Solutions U.S.A., Inc. Konica Minolta Systems Laboratory, Inc. Albin Industries, Inc. Alpha Omega Business Systems Inc. Alternative Business Systems, LCC Business Systems, Inc. Frontier Business Systems, Inc. Konica Computer Solutions, Inc. Nevada Business Systems, Inc. Konica Supplies Manufacturing U.S.A., Inc. Minolta Advance Technology, Inc. Konica Minolta Business Solutions (Canada) Ltd. Konica Minolta Business Solutions (MONTREAL) Inc. Konica Minolta Business Solutions de Mexico SA de CV. Konica Minolta Business Solutions do Brazil Ltda. Europe Konica Minolta Business Solutions Europe GmbH Konica Minolta Business Solutions Deutschland GmbH Konica Minolta Printing Solutions Deutschland GmbH Develop GmbH ECS Buero-und Datensysteme GmbH Office-boerse.de Internet GmbH Plankopie Gesellschaft fur Burosysteme (Monchengladbach) mbh Konica Minolta Business Solutions (UK) Ltd. Konica Minolta Printing Solutions (UK) Ltd. Konica Minolta Business Solutions East Ltd. Konica Minolta Business Solutions France S.A.S. Konica Minolta Printing Solutions France S.a.r.l Repro Conseil S.A.S. Konica Minolta Supplies Manufacturing France S.A.S. Konica Minolta Printing Solutions Europe B.V. Konica Minolta Business Solutions Austria GmbH Konica Minolta Business Solutions (BELGIUM) N.V. Konica Minolta Business Solutions Denmark a/s Konica Minolta Business Solutions Italia S.p.A. Konica Minolta Business Solutions Spain S.A. Konica Minolta Business Solutions Portugal Lda. Konica Minolta Business Solutions Sweden AB Konica Minolta Business Solutions Norway AS Konica Minolta Printing Solutions Nordic AB Hoyseter Utleie AS Konica Minolta Baltia, UAB Konica Minolta Croatia - Business Solutions d.o.o. Konica Minolta Business Solutions Czech spol. s.r.o. Konica Minolta Hungary Business Solutions Ltd. Konica Minolta Business Solutions Romania s.r.l. 25

27 Konica Minolta Slovakia spol. s.r.o. Konica Minolta Business Solutions Slovenia d.o.o. Konica Minolta Business Solutions Polska s.p. z.o.o. Konica Minolta Ukraine Affiliates of Konica Minolta Opto, Inc. Japan Konica Minolta Components Co., Ltd. Konica Minolta Opto Products Co., Ltd. Nankai Optical Co., Ltd. Konica Minolta Glass Tech. Co., Ltd. Asia/Pacific Konica Minolta Opto (DALIAN) Co., Ltd. Konica Minolta Opto (SHANGHAI) Co., Ltd. Affiliates of Konica Minolta Photo Imaging, Inc. Japan Konica Minolta Marketing Corporation Konica Minolta Photo Solutions Co., Ltd. Konica Minolta Camera Service Co., Ltd. Konica Minolta ID Imaging Co., Ltd. Konica Minolta ID System Co., Ltd. Konica Minolta Packaging Co., Ltd. Konica Minolta Chemical Co., Ltd. Asia/Pacific Konica Minolta Photo Imaging Asia H.Q. Pte. Ltd. Konica Minolta Photo Imaging (HK) Ltd. Konica Minolta Photo Imaging (SHANGHAI) Co.,Ltd. Konica Minolta Optical Products (SHANGHAI) Co., Ltd. Konica Minolta Photo Imaging (Thailand) Co.,Ltd. Konica Minolta Photo Imaging Malaysia Sdn. Bhd. Konica Minolta Precision Engineering Malaysia Sdn. Bhd. Konica Minolta Photo Imaging Australia Pty. Ltd. North and South America Konica Minolta Photo Imaging U.S.A., Inc. Konica Minolta Manufacturing U.S.A., Inc. Europe Konica Minolta Photo Imaging Europe GmbH Konica Minolta Photo Imaging (UK) Ltd. Konica Minolta Photo Imaging France S.A.S. Konica Minolta Photo Imaging (Schweiz) AG Konica Minolta Photo Imaging Nordic AB Konica Minolta Photo Imaging Benelux B.V. Konica Minolta Photo Imaging Czech spol. s.r.o. Konica Minolta Photo Imaging Polska s.p. z.o.o. LLC Konica Minolta Photo Imaging Russia Affiliates of Konica Minolta Medical & Graphic, Inc. Japan Konica Minolta Medical Co., Ltd. Konica Minolta Graphic Imaging Japan Co., Ltd. Konica Minolta Medical & Graphic Technosupport Co., Ltd. Konica Minolta Repro Co., Ltd. Konica Minolta Technoproducts Co., Ltd. Asia/Pacific Konica Minolta Medical & Graphics (SHANGHAI) Co., Ltd. North and South America Konica Minolta Graphic Imaging U.S.A., Inc. Konica Minolta Medical Imaging U.S.A., Inc. Europe Konica Minolta Medical & Graphics Imaging Europe GmbH Affiliates of Konica Minolta Business Expert, Inc. Japan Konica Minolta Logistics Co., Ltd. Konica Minolta Sogo Service Co., Ltd. Konica Minolta Engineering Co., Ltd. Konica Minolta Information System Co., Ltd. Affiliates of Konica Minolta Technology Center, Inc. Japan Konica Minolta Technosearch Co., Ltd. North and South America Konica Minolta Technology U.S.A., Inc. 26

28 Global Activity Meeting Constantly-changing Market Needs by Building a Strategic Business Structure with a Vision for Global Market Trends. The Konica Minolta Group currently operates via its bases established in some 40 countries all over the world. Overseas sales of products and services account for more than 70% of total sales generated by the Group. In order to continue enhancing the presence of the Konica Minolta brand in the global market, we have built a strategic network finely tuned to market trends, which vary from region to region. We provide products and services promptly in response to constantlychanging market needs. EUROPE Securing a Large Market Share in Europe through Our Established Sales Network. Konica Minolta s expansion into the European market dates back to many years ago. In Europe, we have developed sales & logistics networks for our mainstay products, such as office equipment and optical products. We currently supply products and services across the entire European region from bases established in 24 countries, centering on Germany. Notably, our A4 color laser printers have the largest market share in many European countries, including Germany. Our optical products including digital cameras also enjoy a high reputation, as proven by their winning of the most authoritative awards in Europe repeatedly, such as awards from TIPA* 1 and EISA.* 2 We are also making pioneering efforts to tap markets in Eastern Europe, where the demand for office equipment is increasing. Our efforts are being rewarded in the form of a large market share in various regions, including Russia. Further, our environmental friendliness is praised in environmentally-advanced Europe, as exemplified by us having the largest number of products with Blue Angel Mark* 3 certification in the world. *1 TIPA Technical Image Press Association *2 EISA European Imaging and Sound Association *3 Blue Angel Mark The world s first environmental label introduced in Germany in 1978, awarded to products with limited environmental impact. 27

29 AMERICA Implementing Speedy Business in the Rapidly-changing North American Market. Our marketing and sales activities are aggressive in the North and South American markets, especially in the United States, the world s single biggest market. In the more digitalized and networked North American market, we are establishing new sales channels for each business and promoting speedy business expansion. In the office equipment business, we have established a research center for network technology, etc. in the U.S., which has been engaged in product development targeted at the global market in cooperation with research centers in Japan. On the sales front, we are further enhancing direct sales networks for copiers and MFPs, which have expanded as a result of the integration. In the printer business, we are striving to reinforce our sales force, including expanding our IT channels especially for color printers. ASIA Enhancing the Business Structure in the Ever-expanding Chinese Market. China is experiencing rapid economic progress. It is one of the most important markets for each and every business of the Konica Minolta Group. In March 2005, we established KONICA MINOLTA (CHINA) CO., LTD., as a fully-owned subsidiary of Konica Minolta Holdings, Inc. The new company, launched with the aim to reinforce our business structure in the Chinese market, takes the form of a holding company and is in charge of establishing our brand and conducting sales activities. As our central base in China, it will serve as the driving force behind business expansion in the Chinese market, with the possibility of placing the nine existing locally-incorporated companies under its control in the future. Shifting Production Bases for Office Equipment and Optical Products to China. We have been shifting our production bases for office equipment (copiers, multi-functional peripherals (MFPs), printers, etc.) and optical products (digital cameras, etc.) to China, in order to enhance our international competitiveness. The shift has been significant especially for office equipment, the core business of the Konica Minolta Group, as we have shifted production to China, and even established a new subsidiary for office equipment production in December Efforts are also being made to further boost our production capacity, including a plan to build a new factory in October

30 Corporate Social Responsibility (CSR) We will Fulfill Our Corporate Social Responsibility (CSR) to Remain Trustworty to All Stakeholders Stakeholders trust is indispensable in making our businesses continually grow and improving our corporate value. For this reason, we are striving to enhance corporate governance and compliance, and aggressively making efforts in protecting the environment, contributing to society and communicating with the general public. * For further information, please refer to Konica Minolta CSR Report Pursuit of Management Philosophy and Implementation of the Konica Minolta Group Charter of Corporate Behavior Form the Basis of Konica Minolta s CSR. For the Konica Minolta Group, CSR is management itself. Our CSR stance is based on our management philosophy to pursue the creation of new value and the Konica Minolta Group Charter of Corporate Behavior, which were implemented when Konica and Minolta integrated. The Konica Minolta CSR concept is summarized below. Striving to Raise Corporate Value through Communication. The Konica Minolta Group believes that CSR depends heavily on two-way communication with stakeholders such as our customers, shareholders, employees, suppliers, contractors and residents in the environs of our business sites. We adequately and fairly publicize our corporate information to gain correct understanding and trust from a wide range of stakeholders. Additionally, we engage in active communication with stakeholders in an effort to win their trust, to build a corporate group that is welcomed and to maximize corporate value. Konica Minolta CSR Concept With the management philosophy The creation of new value, the Konica Minolta Group aims to be an innovative global corporation that continues to create inspiring products and services in the imaging field and that leads the market in advanced technologies and reliability. To this end, we have established the Konica Minolta Group Charter of Corporate Behavior, covering beneficial and safe products and services, fair and transparent corporate conduct, communication with society at large, environmental protection, active contribution to society and respect for employees. Each and every member of the Group is committed to make CSR the basis for daily activities, and to constantly improve each of these points. By constantly improving our behavior, we can earn the trust of our customers, shareholders, suppliers, contractors, regional companies, employees and other stakeholders. By fulfilling our corporate responsibilities in the wider economic, social and environmental spheres, we are confident that we will also raise our corporate value. In the field of imaging, we will continue to maintain our indispensable presence. CSR Concept Communicating with stakeholders suppliers and contractors Disclosing information employees Policies related to business projects Policies unrelated to business projects Rolling Maximizing corporate value shareholders Konica Minolta Maximizing corporate value Communicating with stakeholders Implementing medium-term management plan customers Trustworthy enterprise in terms of economy, society and environment society 29

31 Environmental Protection Efforts Aiming to Achieve both Economic and Environmental Management by Means of Consistent Management System. The Konica Minolta Group promotes all of its corporate activities in harmony with mankind and the environment by integrating environmental, economic and social perspectives into its corporate strategy to achieve sustainable progress and profitable growth. Our intensive measures include Measures to Prevent Global Warming, Minimization of Chemical Risks and Initiatives Toward a Sound Material-cycle Society. Measures to Prevent Global Warming By FY 2010, we aim to reduce CO2 emission by 7%. Management of Chemicals We phased out the use of chloroform, formalin and dimethylformamide (DMF). Promotion of Zero Waste Disposal Activities We are engaged in zero waste disposal with due regard to economics. Community environmental briefing Environmentally Sound Products We strive to minimize the use of energy in products, conserve resources and avoid using hazardous substances. Initiatives for Environmental Communication We actively disclose information to local communities by holding community environmental briefings, issuing reports, etc. Coexistence with Society and Community Along with its Business Activities, Konica Minolta engages in a Variety of Social Contribution Activities as a Member of Society. The Konica Minolta Group believes that it is important to establish, maintain and improve cooperative relationships with society through a variety of activities. The Konica Minolta Group pursues social contribution activities that arouse extensive empathy from and give satisfaction to society, as well as people and groups involved and our employees who participate in these activities. Currently, the Konica Minolta Group is categorizing these activities into global, regional and local programs according to the area and the nature of the activities, along with making efforts to make them more effective. Konica Minolta Track & Field Club Global Program Support for Pink Ribbon Campaigns We sponsor campaigns aimed at eliminating the tragedies caused by breast cancer all over the world. In the U.S. and Lithuania, the Konica Minolta Group made a donation to and voluntarily participated in campaigns against breast cancer. In Japan, the Konica Minolta Group is supporting the Pink Ribbon Campaign that underscores the importance of early detection of breast cancer. Regional Program Mobile Planetarium (Japan) Our small mobile planetarium brings enjoyment to people in several locations in Japan, by delivering images of space and various stories. Local Program Commemorative Graduation Photographs (China) In China, in cooperation with local agencies, the Konica Minolta Group presents all graduating elementary, junior high and high school students (approximately 7,000 graduates) in Qingzhou city, Shandong Province, with commemorative graduation photographs every year. The Konica Minolta Group helps promote and nurture sports. The Konica Minolta Track & Field Club, which was established in 1970, trains world-class runners, and won the 2005 New Year s Ekiden race for the fourth time. The Club s impressive track record includes Eric Wainaina s winning of a bronze medal in the men s marathon in the Atlanta Olympics and a silver medal in the Sydney Olympics, followed by the winning of a prize at the Athens Olympics. The Club is also involved in a wide range of activities, including annual jogging sessions aimed at promoting a deeper fellowship with citizen runners. KONICA MINOLTA S History 1873 Rokusaburo Sugiura began selling photographic and lithographic materials at Konishiya Rokubeiten in Kojimachi, Tokyo (the startup of the business of Konica Corporation) Marketed Cherry Hand Camera, Japan s first brand name camera Kazuo Tajima established Nichi-Doku Shashinki Shoten (Japan-Germany photo company; the precursor of Minolta Co., Ltd.) and launched production of cameras in Japan. Marketed the Company s first camera Nifcalette in the following year Released the first made-in-japan color film Sakura Natural Color Film Established the first American subsidiary in Philadelphia, USA Completed the Company s first planetarium unit Completed the Company s first copier Copymaster Established the first European subsidiary in Hamburg, Germany Released high-performance photostatic plain paper copier U-Bix Launched the operation of the Sakura driver s license printing system nationwide Released the world s first 35mm camera with built-in flash and AE functions C35EF Released the world s first 35mm compact autofocus camera C35AF Released the world s first copier with zoom magnification/reduction function EP450Z Developed an ultra-high-precision aspheric plastic lens for CD players Released SLR camera with autofocus function Released simple color-proofing system Konsensus Released medical digital imaging output system Laser Imager Li Released monochrome laser printer SP101 ; entered LBP market on a full scale. Released digital full-color copier CF Fully launched business for TAC films for LCD polarizers. Established Konica Minolta Supplies Manufacturing Co., Ltd., a joint venture for the production of polymerized toners Integrated the management of Konica Corporation and Minolta Co., Ltd. K ONICA MINOLTA'S History 2005 Digital SLR camera -7 DIGITAL* wins Camera Grand Prix 2005 in Japan. * in Europe DYNAX 7D, in North America MAXXUM 7D Established a subsidiary for the production of MFPs and printers in Wuxi, China. 30

32 This report is printed on 100% recycled paper using soy-based inks. Printed in Japan 0509BCT