Japanese electronic giant Panasonic forecasts staggering losses

Nigeria Sun Friday 3rd February, 2012

TOKYO - Japan's Panasonic Friday predicted staggering annual loss of $10.2 billion, joining rivals Sony and Sharp who have also forecast combined losses of $6 billion.

Panasonic said it was headed for a loss of 780 billion yen for the year to March and blamed the poor result on the strong yen, flooding in Thailand and acquisition costs.

The figures dwarfed the worst fears analysts had been predicting as the grim outlook means a huge combined loss of $17 billion for the three Japanese electronics firms.

Panasonic, which is in the process of shedding 17,000 jobs by end-March, also missed third-quarter market forecasts, diving to a loss of 197.6 billion yen from a profit a year earlier.

Its president Fumio Ohtsubo gave no indication to reporters that his firm planned to ditch the TV business.

"I don't think it's a business that has lost its growth potential," he said, adding Panasonic wanted to "develop TV in a different manner" by exploring growth in sales to businesses rather than direct to consumers.

Panasonic and other Japanese exporters are also being hit by competition from foreign rivals such as South Korea's Samsung.

According to Reuters, the near-term outlook for better TV sales looks grim.

By 2015, flat panel industry research company DisplaySearch expects annual global sales of liquid crystal TVs to contract by eight per cent to $92 billion. Even worse, plasma sets, a market that Panasonic dominates, will shrink 38 per cent to $7 billion.

If Panasonic's market share "keeps shrinking by 10 per cent or so, they may need to prepare some more restructuring," Shiro Mikoshiba, analyst at Nomura Holdings in Tokyo, told Reuters