Panasonic seen falling back into the red: report

October 31, 2011 | 10:12

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Panasonic is expected to suffer a $4 billion net loss in the year to March 2012, despite an initial forecast of profit, hit by a global business downturn and stronger yen, according to a report.

The Japanese company's plan to scale back its money-losing television and semiconductor divisions is incurring restructuring costs which also hurt its balance sheet, the business daily Nikkei reported on Sunday.

The electronics giant is now forecast to post a group net loss of 300 billion yen (about $4 billion) in the fiscal year, reversing a net profit of 74 billion yen for the preceding year, the report said.

It would be the company's first net loss in two years.

Panasonic had earlier forecast a group net profit of 30 billion yen for the current fiscal year.

The company is due to announce its April-September earnings on Monday.

Its group sales are also projected to fall far below its earlier forecast of 8.7 trillion yen, the report said.

Panasonic's sales of audio-visual equipment remain stagnant in the US and European markets while domestic demand for flat-panel TVs has fallen since Japan's full transition from analogue to digital terrestrial broadcasting in July, the report said.

It added that the suspension of operations at some of Panasonic's factories due to the flooding in Thailand and the yen's appreciation against the dollar were also reducing its operating profit.

AFP

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