Thank you very much for joining us for the presentation of FY 2018 financial results and the midterm management plan of Nikon Corporation. My name is Oka. I am the Senior Executive Vice President and CFO. I would like to explain the actuals of FY 2018 and forecast of FY 2019. I will start with overview of financial results for FY 2018. Operating profit was JPY 82.6 billion, JPY 26.4 billion up year-on-year. If we exclude the restructuring relevant expenses, it would be JPY 84.4 billion, JPY 19.5 billion up year-on-year because the one-off cost is lower by JPY 6.5 billion. With our imaging products, although we focused on high value-added products, including new launched Z-mount full frame mirrorless cameras such as Z7 and the Z6, against the background of shrinking market, operating profit suffered due to substantial decline in sales volume, especially in entry and mid DSLR.
With regard to precision equipment, operating profit was substantially lifted by the brisk sales of large-sized FPD lithography systems, in addition to the one-off profit, approximately JPY 15 billion, excluding additional relevant expenses from settlement of patent litigation in semiconductor lithography business. Against the previous forecast, operating profit was up by JPY 2.6 billion. For the imaging product, we did not meet the plan due to severe market condition in the fourth quarter. Other businesses, including precision equipment, overachieved the plan and offset the downturn of imaging products. Profit attributable to owners of the parent was JPY 7.5 billion, up from forecast, thanks to higher profit before income taxes and lower than expected tax expenses, mostly in Japan. ROE was 11.2%, and this would have been 9.4% if we exclude the one-time profit from litigation settlement. Annual dividend is at JPY 60, unchanged from the forecast.
This is a JPY 24 increase from the JPY 36 from the previous year. Now, I would like to explain about the specific numbers, starting with total company consolidated revenue and profit and losses. Highlighted in yellow, you can see the full year result of FY 2018. Revenue was JPY 708.6 billion, down by JPY 8.4 billion or 1% year-on-year. Operating profit was JPY 82.6 billion, major increase of 47% or JPY 26.4 billion. Against the previous forecast, revenue was lower by JPY 11.4 billion, and operating profit was higher by JPY 2.6 billion. Net profit was increased largely year-on-year by JPY 31.8 billion to JPY 66.5 billion, which is higher than the previous forecast by JPY 7.5 billion. Free cash flow was JPY 43.5 billion, down by JPY 46.7 billion year-on-year, and lower than the previous forecast by JPY 16.5 billion.
This reduction was mostly due to the changed payment terms for domestic partner companies. Year-on-year, the exchange rate for dollars remained constant, and the euro was JPY 2 higher, impacting negatively the revenue by JPY 3.8 billion and operating profit by JPY 3.7 billion. Compared to the previous forecast, dollar was JPY 1 lower, euro remained constant and provided a positive impact of JPY 2.9 billion for revenue and a negative impact of JPY 600 million for operating income. Moving on to performance by segment. Numbers in parentheses for operating profit shows the figures excluding the restructuring relevant expenses. You can find the details by business segment in the following pages. Starting with our imaging products business. Revenue was at JPY 296.1 billion, down by JPY 64.6 billion year-on-year. Operating profit was at JPY 22 billion, down by JPY 8.2 billion.
Due to shrinking DSLR and compact camera markets, the sales volume of our interchangeable lens cameras was at JPY 2.06 million, down by 21% year-on-year, and sales of interchangeable lenses was JPY 3.17 million, down by 21%. For compact camera, the volume was JPY 1.6 million, down by 36%. By focusing on high value added products, ASP of each product category increased, but revenue decreased due to declining sales volume. There was a significant impact by the decline of entry and mid models of DSLR. Sales volume and revenue for full frame camera continued to grow for two years in a row thanks to the impact of the launch of a full frame mirrorless camera. With regard to operating profit, although we tried to decrease the sales expenses, we could not really offset the negative impact of a declining profit due to declining revenue.
Restructuring relevant expenses was lower than the initial plan by JPY 400 million, and it stood at JPY 600 million. One time expense of suspension of operation in the Chinese factory in the previous year was JPY 5.8 billion. If we exclude these one time expenses for restructuring, this number is JPY 22.6 billion, which is down by JPY 13.4 billion year-on-year. The fourth quarter market was tougher than expected, and we did not meet the target for interchangeable lens camera and interchangeable lenses in terms of sales volume. Mirrorless Z mount lens shipment was shifted from April to March to some extent, which pushed up the initial cost and had a negative impact on the operating profit by JPY 3 billion. Moving on to precision equipment business. Revenue was JPY 274.5 billion, up by JPY 48.2 billion year-on-year. Operating profit was JPY 81.7 billion, up by JPY 28.4 billion.
FPD lithography revenue increased due to growth in CapEx for large panels in China. We sold 70 systems, which is an increase of three units year-on-year. We sold 16 units of fifth and sixth generation systems for smartphone and small to mid-size panels, which was a reduction of 18 units. We sold 37 units of seventh and eighth generation systems for TV and large panel, which is an increase of seven units. We sold 17 units of 10.5 generation with higher unit cost, which is an increase of 14 units. The increase in the revenue of large panel more than offset the decline in revenue for small to midsize panel. Details can be found on page 31. For semiconductor systems business, revenue increased due to steady growth of CapEx increase by our clients.
We sold 21 new systems, which is an increase of four units, and 20 refurbished systems, which is an increase of seven units. As per slide 31, we sold seven units of immersion systems, up by two units, and 11 units of ArF dry system, which is up by three units. Semiconductor system business posted profit for two years in a row, even excluding the profit coming from the litigation settlement, which is JPY 15 billion. It is showing that due to restructuring, now they can generate profit. Against the forecast, the refurbished system sales increased by nine units, but because of the change in the product mix between FPD and semiconductor, revenue was lower by JPY 2.5 billion. For FPD and semiconductor, profitability has improved and therefore the operating profit was higher by JPY 2.7 billion. Moving on to healthcare business.
Revenue was JPY 65.4 billion, up by JPY 8.6 billion year-on-year. Operating profit was JPY -1.9 billion, but showed JPY 1.3 billion improvement. With regard to revenue, in the bioscience field, sales grew for biological microscope in North America and China. For ophthalmological diagnosis field, sales grew thanks to the introduction of new products such as Optos Retinal Diagnostics Imaging System. Both biological microscope and retinal diagnostics imaging system posted record sales. Strategic investment to expand the business for retinal medicine and retinal diagnostics imaging system continues, thanks to the increased profit in biological microscope and Optos Retinal Diagnostics Imaging System, the deficit shrank both year-on-year and against the forecast. Finally, industrial metrology business and others. Revenue was JPY 72.5 billion, down by JPY 700 million year-on-year, operating profit was JPY 6.9 billion, up by JPY 1.9 billion.
For industrial metrology business, the revenue was down due to business transfer of CMM conducted in the previous year and softer market. We saw revenue increase in other businesses, for that segment as a whole, revenue was down. Restructuring relevant expenses was at JPY 600 million, lower than the original plan by JPY 400 million. Excluding this expense, operating profit was JPY 7.5 billion. In the previous year, there was a one-time expense related to the CMM business transfer. Excluding the restructuring relevant expenses, this was down by JPY 300 million year-on-year. Against the previous forecast, due to decelerated CapEx investment by customers, our sales plan for the first quarter did not get achieved. Thanks to the improvement of profit in other businesses and reduction in one-time expenses, operating profit was up by JPY 900 million. Moving on to FY 2019 forecast.
Restructuring, which began in November 2016, achieved expected results, therefore this program will be concluded. We will continue to implement initiatives for stronger company management, starting from this fiscal term, we will pivot our focus to growth. Under the new medium-term management plan, overview of restructuring as well as the new medium-term management plan will be explained by Mr. Umatate, our President, later on. We expect the coming year to be quite tough for us considering the environment that surrounds our business. Please understand that our forecast actually reflects our assessment of this situation.
Starting with our full-year forecast highlights. Revenue is expected to stand at JPY 670 billion, which is down by JPY 38.6 billion year-on-year. In the imaging products, as we see the shrinking digital camera market, we will focus on expanding sales of mirrorless cameras and Z mount lenses. However, the unit sales for the existing products, such as DSLR, is expected to go down a lot to see a huge drop in our revenue.
Precision equipment. The sales increases in the semiconductor lithography business, which offsets the sales drop in FPD lithography business. Operating income will go down by JPY 30.6 billion year-on-year for the whole company to be JPY 52 billion. Imaging business. We will further streamline the business operation cost to reduce the impact of net profit decline driven by the revenue decline. But there's an increased initial cost burden, we expect to continue to have that decline profit. In precision equipment, there is a unit volume drop in FPD lithography business, there will be no more one-off gain of JPY 15 billion, that was posted last year due to litigation settlement. We expect to see a substantial drop in our profit.
There is an increased profit by increased revenue of semiconductor lithography business. This can alleviate the negative income impact by the FPD lithography business sales drop. Also, corporate P&L not attributable to any reporting segment is expected to improve a lot by including the idle land sales of JPY 3.9 billion. Net income is expected to be JPY 42 billion, down by JPY 24.5 billion year-on-year. Our effective tax rate will be around 24%. Let me go over specific numbers. First of all, let me go through the company-wide full-year forecast. Please take a look at the numbers in a yellow box. Revenue will be JPY 670 billion, down by JPY 38.6 billion, which is a decline of 5%. Operating income will be JPY 52 billion, down by JPY 30.6 billion year-on-year. It is a 37% decline. Net income will be JPY 42 billion, down by JPY 24.5 billion year-on-year. It is a decline of 37%.
Free cash flow full year forecast will be JPY 40 billion. There will be a substantial decline in the net income. However, there is a litigation settlement fee inflow to minimize the decline in free cash flow compared to the previous year. Forex assumptions. We expect JPY 105 to a dollar, JPY 125 to a euro. Compared to the previous year, yen appreciates six yen against dollar and three yen against euro. Year-on-year FX impact on revenue is expected to be negative JPY 16.4 billion, on operating profit, negative JPY 3.2 billion. The FX sensitivity for one yen change to a dollar and a euro are listed on slide 34 on our reference document. Impact on revenue would be around JPY 2.4 billion against dollar and roughly about JPY 600 million for euro. The impact on OP would be around JPY 400 million to a dollar and roughly JPY 300 million for euro.
Let me go over the business forecast by different segment. The assumptions for such business forecast for each business will be explained in the following pages.
Starting with imaging products business. Due to the shrinking market, we expect to see a decline in the unit sales in each product category to expect a drop in revenue and profit. The revenue will be going down by JPY 36.1 billion year-on-year to be JPY 260 billion. We continue to see a shrinking digital camera market. The unit volume is down by 15% for interchangeable lens type digital cameras, down by 14% for interchangeable lenses, and down by 27% for compact DSCs. In our digital camera unit sales volume for each products will be also affected by the shrinking market. The interchangeable lens type digital camera will go down by 22%, interchangeable lenses will go down by 18%, compact DSC will go down by 37%.
Focusing more on high value added products and expanding sales for mirrorless cameras and Z mount lenses, we expect ASP to go up continuously. However, the impact of declined unit sales volume for the entry and mid model DSLR, as well as compact DSCs, will be quite huge that we have to plan a decline revenue. Operating profit will go down by JPY 10 billion to be JPY 12 billion. We will streamline SG&A and R&D spending to minimize the expenses in order to offset partially such a profit decline driven by the revenue decline. We're going to have to also invest to reinforce product lineups for Z mount lenses. We expect to see a profit decline for two years in a row. The market's shrinking more than expected.
While we expect to have more spending and investment into mirrorless lineup enhancement, and that put us in a difficult condition when it comes to for this fiscal year forecast profit numbers. We will need to hurry up to convert our business structure for not depending too much on the imaging products business. At the same time, we also work on reviving the profitability of imaging product business, which is one of our core businesses. We recognize that as one of the important missions led by the management. So far, in the imaging product business, during this structural reform period, we have optimized more than 4,000 headcounts, as well as about JPY 15 billion worth of fixed costs. We will recognize the difficult business environment to come, even under the rapidly declining market.
We will make sure to generate profit securely by reviewing all aspects in development, production, and sales, and building a solid business structure. Next is on precision equipment business. The revenue for the precision equipment is expected to go down by JPY 4.5 billion year-on-year to be JPY 270 billion. The unit sales for FPD lithography system is expected to go down by 33 units to be 37. We see a moderation in CapEx for the mid and small size panels. Also, the CapEx for large side panel is now shifting from seventh- and eighth-generation to Gen 10.5. Fifth and sixth generation system will be reduced from 16 units to 5 units. Seventh and eighth generation system will go down from 37 units down to 10 units. On the other hand, high ASP Gen 10.5 system is expected to increase from 17 to 22 units.
More details will be listed in our reference document on slide 31. Semiconductor lithography system sales volume, including refurbished systems, will go up by four units year-on-year to be 45 units. Of them, the new system will increase by 10 units to be 31 units. This is due to a strong CapEx taking place at our customers. As you see on slide 31, the sales volume for ArF immersion and ArF dry system will increase from 7 to 12 and 11 to 13, respectively. Operating profit is expected to go down by JPY 25.7 billion year-on-year to be JPY 56 billion. The declining profit for FPD will be partly offset by the increased profit of semiconductor systems. By excluding one-off profit by litigation settlement, we expect the profit will go down by about JPY 10.7 billion year-on-year.
Since the end of March 2019, we have been disclosing the corporate level of backlog at the end of the fiscal year. The backlog is for the orders taking more than one year from order taking until the sales booking. At the end of March 2019, we had a backlog of about JPY 450 billion, and more than 95% of the corporate backlog is coming from precision equipment business. Next is in healthcare business. Revenue is expected to go down by JPY 400 million year-on-year to be JPY 65 billion. Biological microscopes and retinal diagnostic imaging systems will continue to perform solidly, mainly in overseas. However, revenue will stay almost flat due to negative FX impact. Investments continue in regenerative medicines and ophthalmological diagnosis. Through focused investments, deficit will be reduced almost by half to be JPY 1 billion. It's expected to shrink as planned.
There's no change to our plan to be profitable next fiscal year. Industrial metrology and others. Revenue is expected to go up by JPY 2.5 billion year-on-year to be JPY 75 billion. Industrial metrology business, we have X-ray inspection equipment and non-contact 3D metrology systems, which are highly appreciated by customers. By expanding market share, we expect to grow our revenue. Operating profit is expected to go down by JPY 900 million to be JPY 6 billion. The previous year had a restructuring related expense worth JPY 600 million. By excluding them, apple-to-apple comparison will result to be a profit decline of JPY 1.5 billion. Industrial metrology business will see improved profitability through restructuring. We will continue to make investment into component business and future growth, overall segment is expected to see a profit decline. Lastly, let me touch on our shareholder return policy.
Fiscal March 2019 annual dividend was JPY 60, with payout ratio of 35.7%. That policy to maintain 40% or higher was not met because of a substantial upside of our net profit. Based on this net profit upside, we are conducting the share buybacks up to JPY 10 billion. The share buybacks will be exercised in FY March 2020. Including this buyback, the total return ratio for March 2019 will exceed 50%. We expect a profit decline this fiscal year, still the annual dividend of JPY 60 and interim dividend of JPY 30 is planned as in fiscal 2019 to maintain stable dividend payout. To exercise more flexible return to shareholders, the policy is revised from dividend payout ratio of 40% or higher to total return ratio of 40% or higher as accumulation of medium term plan period. We will maintain annual dividend of JPY 60 or higher.
Although mid and long-term capital allocation prioritizes investment for growth strategy, additional return to shareholders is judged with agility and flexibility to maximize shareholders' interest. If any unexpected change occurs in the management environment, this policy may be revised based on the remaining capability for growth, investment, and capital structure. From the mid and long-term perspectives, we will pursue both stable return to shareholders and capital efficiency improvement. This concludes my explanation.