Further Promoting Growth Strategies

Strategies in the VISION75 (2007)

Medium-term Management Plan

In line with the growth strategies of VISION75 (2006), we will further step up capital investment, M&A, and R&D investment in priority business fields based on the following fundamental strategies:

Fundamental Strategies

Attain superior competitiveness by catching users' needs and shifting to high value-added products
Seize additional business opportunities by broadening the scope of business domains
Strengthen and expand businesses by creating Group synergies

Key points of current and future business strategies in major priority business fields

Priority Business Field	Key Points of Current and Future Business Strategies
Medical Systems	Expand business domains and change portfolio (film-oriented to equipment- and network-oriented) Expand business as integrated diagnostic imaging solutions provider Step up marketing of diagnostic modality solutions Expand network business through reinforcement of SYNAPSE medical-use picture archiving and communications system Incorporate business of integrated systems for management of reception, examination, data referencing, and reporting functions in endoscopy and sonography examination operations Expand in new fields Radiopharmaceuticals, sonography diagnostic imaging systems, capsule endoscopes, etc.
Medical Systems	Target Year ending March 31, 2009 ¥300 billion in revenue (including life sciences)
Graphic Arts	Expand businesses Reinforce global sales capabilities and cost competitiveness by establishing worldwide quadripolar business promotion organization Expand production capacity in response to increased demand for CTP plates Expand industrial inkjet printer-use ink business Produce synergies between FUJIFILM Corporation and Fuji Xerox Co., Ltd. in print-on-demand field
Graphic Arts	Target Year ending March 31, 2009 ¥300 billion in revenue
Documents	Improve profitability Accelerate growth of solutions business Strengthen solutions business catering to increasing sophistication of customer needs Reinforce collaboration in commercial printing field Accelerate growth in Asia-Pacific region including China Further bolster share of color multifunction devices market in Asia-Pacific region including China
Documents	Target Year ending March 31, 2010 10% ratio of operating income to revenue
Optical Devices	Expand businesses Expand production capacity mainly at Shenzen and Tianjin plants in China to meet growing demand for lenses, including those for camera phones Secure position in each market by launching differentiated, high value-added products Produce synergies between FUJIFILM Corporation and FUJINON Corporation, and promote reinforcement of product development capabilities and cost reductions
FPD Materials	Continue to expand businesses Guarantee stable growth of FUJITAC and WV Films Expand incorporation of WV Films in medium-sized (26-inch and 32-inch) TN mode televisions Increase FUJITAC production capacity through capital investment in FUJIFILM Kyushu Co., Ltd. Contribute to panel cost reductions through production of ultra-wide FUJITAC Expand the business of materials for TV polarizing plates Expand supply of VA and IPS mode-related high value-added materials
FPD Materials	Target Year ending March 31, 2010 ¥300 billion in revenue

Fujifilm plans to spend ¥200 billion for capital expenditures in the fiscal year ending March 31, 2008 and ¥550 billion during the three-year period until March 31, 2010. We also plan to spend ¥200 billion on R&D in the fiscal year ending March 31, 2008 and a total of ¥600 billion to ¥700 billion over the same three-year period. In addition, we will continue to carry out M&A aggressively and further expand growth.

Capital Expenditures, Depreciation and Amortization, and R&D Expenses Targets

(Billions of yen)

	Mar. '08	Total during Mar. '08 - Mar. '10
Capital expenditures*	200	550
Depreciation and amortization* (Depreciation)	220	700
Depreciation and amortization* (Depreciation)	150	500
R&D expenses	200	600-700

* Excluding rental equipment in the Document Solutions segment

Realizing a Robust Corporate Constitution

We are currently implementing the “Slim & Strong Drive” targeting all organizations in the Fujifilm Group. These activities promote thorough improvements in efficiency and the prioritized use of manufacturing costs, selling, general and administrative (SG&A) expenses, and R&D expenses, and aim to realize a stronger and more robust corporate constitution.
Through these activities, we will reform our corporate culture itself by strengthening the individuals and organizations that support the enterprise and build the foundation of a robust company. At the same time, by promoting greater efficiency and strength in all kinds of business processes, we aim to realize a robust corporate constitution.

One target of these activities is to improve the ratio of selling, general and administrative expenses to sales to around 20% to 25% in the fiscal year ending March 31, 2010, the final year of the VISION75 medium-term management plan. In addition, we will intensify efforts to reduce manufacturing costs and improve the efficiency of R&D at factories and research centers.
In a specific measure to this end, we established a Group shared services company in July 2007. In addition, we are realizing economies of scale by pursuing group-wide optimization of distribution and purchasing activities, and we are promoting cost reductions and the more efficient use of expenditure.

[fig.] Realizing a Robust Corporate Constitution through the “Slim & Strong Drive”

Realizing a Robust Corporate Constitution through the “Slim & Strong Drive”