Q&A on Third Quarter Results for the Fiscal Year Ending March 2010
In addition to effects from the product mix, there is also a possibility that temporary inventory-related expenses will emerge. Also, SG&A expenses (including R&D expenses) will increase by about 3.0 billion yen, driving operating income down.
The lead time varies depending on the type of equipment, but it is generally in the range of four to five months for SPE, while the lead time for FPD/PV production equipment is approximately 10 to 12 months.
We have just begun making our budget for next year, but we plan to conduct all research and development necessary to achieve growth over the medium term. It is likely that R&D expenses will be approximately 10.0 billion yen higher than this fiscal year.
Sales are increasing rapidly in the second half of this fiscal year, but we have been able to control fixed costs as planned. In the next fiscal year, we hope to maintain costs at double the level of the second half of this year.
Orders for SPE will remain flat compared to the previous quarter, but orders for FPD/PV production equipment will increase. We expect an increase of 10% to 20% in the overall orders for SPE and FPD/PV production equipment.
Without substantial investment for the introduction of new production lines, orders for SPE would likely remain at the same level as in the October-December period. If such investment is made, orders will increase greatly. With respect to FPD/PV production equipment, the number of customers is small, so orders tend to vary considerably on a quarterly basis. Orders will likely be in the 10.0 billion to 20.0 billion yen range per quarter.
We expect investment in large-scale facilities by memory customers to increase this year. There is also an indication that only the strongest of the customers and the equipment manufacturers, will be able to survive. We believe that both of those developments will be positive factors for us. Achieving things that other companies are unable to do will enhance our position within the SPE industry.
We cannot answer with regard to any specific customer, but we expect that the timing of large-scale investment will become clearer around March or April.
It will take some time to increase our market share, but we plan to produce definite results in the areas of etch systems and cleaning systems. We believe that the market for etch systems in particular will grow. Competition is fierce, but we hope to expand our market share by about 10 percentage points, which is to say an increase from the current 30% to around 40%. We also recently decided to begin construction of our new Miyagi plant, which will make it possible for us to perform all processes-from development to mass production of state-of-the-art etch systems-under an integrated manner. At the plant, we also plan to mass-produce etch systems that use new RLSA technology.
We strictly manage customer confidential information and plan to take even more rigorous measures going forward. We do not believe that there will be any short-term impact on our business.