Seiko Epson today announced it would implement further structural reforms aiming at improving profitability.

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Structural Reforms in the Display Business and FY2006 Revised Financial Results Outlook

In accordance with its Creativity & Challenge 1000 mid-range business plan established in March 2006, Seiko Epson Corporation (gEpsonh) has implemented a series of measures aimed at improving profitability in each of its businesses. Epson has consequently been able to improve its results based on a profit-oriented marketing strategy in its inkjet printer business, and has been successful in surpassing the first year ordinary income target of its mid-range business plan. On the other hand, the company has been unable to achieve a return to profitability in the small- and medium-sized display business due to changes in the business environment that were not envisioned in the mid-range business plan. Based on the following strategy, Epson will change the direction of its display business, book impairment losses on certain assets, and create a financial structure that will support its business strategy going forward. Epson Imaging Devices Corp. will also stabilize its business operations by making improvements to its financial structure through a reduction and then an increase in its capital, and will strengthen its customer support functions.

Based on the measures taken as a result of this situation, Epson is revising the previous outlook to its financial results.

In addition to the measures announced today, Epson will continue to expedite steps aimed at achieving profitability in each of its businesses.

Please see further details from the following link:

http://www.epson.co.jp/e/newsroom/2007/news_20070314.htm