Japan's Panasonic is forecasting a record annual net loss of $10.2 billion U.S. dollars in the year to March, joining beleaguered rivals Sony and Sharp in a sea of red ink. Matt Cowan reports.
Japan's Panasonic is forecasting a record annual net loss of over $10 billion U.S. dollars for the year to March. The projection is well beyond previous expectations for a loss of around $6.2 billion. At a briefing in Tokyo, company president Fumio Ohtsubo says it was a difficult year on multiple fronts, including costly restructuring. SOUNDBITE: PANASONIC PRESIDENT FUMIO OHTSUBO SAYING (Japanese) : "In order to renew the business and rebuild our company we have taken reform that has caused pain. In addition to that there has been the effects of the earthquake, the floods and the strong yen which all came together to make these difficult results." The company also missed forecasts for the third quarter, tumbling to a loss of 2.6 billion dollars from a profit in the same quarter a year ago. It's in the process of cutting 17,000 jobs which should be completed by the end of March. Weak demand and a strong yen have also hit forecasts by Japanese competitors Sony and Sharp Ohtsubo gave no indication that Panasonic planned to ditch its struggling TV department but did note that there could be points to learn from its overseas rivals such as South Korea's Samsung. SOUNDBITE: PANASONIC PRESIDENT FUMIO OHTSUBO SAYING (Japanese) : "There are indeed a lot of things that can be learned from the Korean makers that we compete against, both on the technical side and the design side. But at the same time the exchange rate has had a very large influence on the market. These sort of factors have combined to bring our TV department to where it is now." Panasonic, which trimmed its forecast for the number of flat-screen TVs it will sell, does expect to make an operating profit for the year, though this is now seen at just $393 million dollars down from a previous estimate of $1.7 billion. Matt Cowan, Reuters