Sony, Matsushita, Toshiba results mixed

July 29, 2008 12:56:05 PM PDT
Three major Japanese electronics makers ? Sony, Matsushita and Toshiba ? reported mixed results Tuesday for their fiscal first quarters, with Matsushita the only one to increase earnings in a period marked by a stronger yen and dropping gadget prices.Sony Corp.'s April-June profit plunged to 35 billion yen ($327 million) ? about half the 66 billion yen recorded a year ago. This time, a strong yen, the absence of last year's "Spider-Man 3" revenue and faltering results at its cell phone operations battered earnings. Sony also was hit by price competition in its core electronics sector.

Sony lowered its full year profit forecast to 240 billion yen ($2.24 billion) from an earlier 290 billion yen ($2.71 billion), blaming poor results expected at its Sony Ericsson mobile joint venture.

In contrast, profit at Matsushita Electric Industrial Co., maker of Panasonic-branded products, nearly doubled from the previous year on solid global demand for flat-panel TVs and digital cameras.

The popularity of such gadgets helped fend off the negative effects of a stronger yen and global price competition, giving Matsushita a 73 billion yen ($682 million) profit for the fiscal first quarter.

Matsushita had recorded a 39 billion yen profit in the same period the previous year.

The company kept its forecast for the fiscal year, which runs through March 2009, unchanged at profit of 250 billion yen ($2.34 billion) on 9.3 trillion yen ($86 billion) in sales.

Toshiba Corp. said it sank into a loss of nearly 12 billion yen ($108 million) in the April-June quarter because a stronger yen and a nosedive in flash memory chip prices. It had posted a profit of almost 21 billion yen the same quarter a year ago.

Toshiba's sales also fell 2.8 percent during the quarter to 1.62 trillion yen ($15.1 billion).

Although the exchange rates varied among the companies because of hedging, the dollar dipped about 13 percent to 105 yen in the April-June period from as high as 120 yen a year earlier. Those higher rates for the yen can make Japanese products more expensive to overseas buyers.

Sony's quarterly sales were essentially unchanged at 1.979 trillion yen ($18.5 billion) compared with 1.977 trillion yen a year ago. If currency rates had remained the same, sales would have jumped 8 percent, Sony said.

In its electronics business alone, Sony said the unfavorable exchange rate erased 14.3 billion yen ($134 million) from its operating profit for the quarter.

Shares of all three companies declined in Tokyo trading before the earnings results were released.

Sony slipped 3.2 percent to 4,210 yen ($39), Matsushita inched down 0.2 percent to 2,180 yen ($20), and Toshiba fell 1.5 percent to 719 yen ($6.69).