To Our Stakeholders

For the first half of fiscal 2013, ended September 30, 2012, Pioneer posted consolidated net sales of ¥224.6 billion, an increase of 5.1% year on year. Operating income, however, declined by 55.0% to ¥3.2 billion, and a net loss of ¥7.5 billion was recorded, reflecting a loss on impairment of investment securities.

We at the Pioneer Group are determined to improve profitability through such measures as introducing value-added products and providing products that meet market needs. Such efforts will lead to sales and profit growth.

In the Car Electronics business, we are working to revitalize the market by promoting sales of innovative car navigation systems that employ our cutting-edge technologies, such as Cyber Navi, equipped with an advanced "augmented reality (AR) head-up display (HUD) unit," and Raku Navi, which features an "Air Gesture" user interface. Also, we are promoting smartphone-linked products including "Appli Unit" in Japan and "AppRadio" overseas.

In our Home Electronics business, we will work to maintain profits by aggressively releasing new products including AV receivers and AV systems with enhanced network compatibility and DJ equipment with an expanded lineup aimed at non-professional users. For optical disc business, we are reviewing its business structure and are reducing costs commensurate with the size of the business to meet a shrinking market.

In the medical and health care-related device business, a new field for us, we formed an alliance with Otsuka Medical Devices Co., Ltd. We will work to jointly develop a new medical endoscope based on HEED-HARP technology, building on its advantageous features of ultra-sensitivity and low power consumption. We plan to commercialize the product by 2014.

We will continue to face a harsh business environment, characterized by uncertainty in the global economy, instability in exchange rates and the situation in China. Despite these issues, we possess technological expertise that has made Pioneer a world-class brand, and I believe this will allow us to continue to provide original and unique products. In addition, we will strive to increase profitability as we promote sales of value-added products with superior technology and implement rigorous cost reduction measures.

I kindly ask for your solid support as we work toward these goals.

December 2012

Susumu Kotani 
President and CEO