Panasonic loss balloons ten-fold

Tokyo: Panasonic's January-March losses ballooned ten-fold to 438 billion yen (Dh20.13 billion), completing a year of record red ink at the Japanese electronics maker battered by natural disasters and an ailing TV business.

Panasonic had racked up a 40.7 billion yen loss the same period the previous year.

The Osaka-based maker of Viera TVs and Lumix digital cameras reported on Friday a record loss of 772.2 billion yen, a reversal from the 74 billion yen profit a year ago and among the biggest in Japan's manufacturing history.

That comes a day after Panasonic's arch rival Sony racked up a record annual loss of 457 billion yen in its fourth straight year of red ink.

Sony, which makes the Walkman portable audio player and PlayStation game machine, had a 255 billion yen loss in January-March — its fifth straight quarterly net loss to round out a fiscal year that was the worst in its 66-year corporate history.

Samsung powerful

Both companies' TV operations, centring around flat-panel sets, have been battered by a powerful Samsung of South Korea and other Asian players.

A strong yen has also eroded the value of overseas earnings for the Japanese.

Like Sony, which is hoping for a turnaround under a new president, Kazuo Hirai, Panasonic has tapped Kazuhiro Tsuga as president. The appointments still need shareholder approval.

Panasonic is forecasting a return to profit for the fiscal year ending March 2013, at 50 billion yen profit on 8.1 trillion yen sales, up 3 per cent.

Panasonic does not have the entertainment or gaming businesses of Sony. But it is struggling as it attempts to strengthen solar panel and battery operations, including car batteries, to find new areas of growth.

In a strategy released on Friday, Panasonic said it will focus on business customers, not just individual consumers. It will increasingly target global buyers such as refrigerators in China and TVs in India, it said.

The company booked 767 billion yen in restructuring expenses over the fiscal year ended March, to turn itself around, including cutting costs in TV operations.

Panasonic's sales fell in every major region, including the US, Europe, Japan, China and the rest of Asia.

Quarterly sales slipped 8 per cent to 1.88 trillion yen. Annual sales plunged 10 per cent to 7.85 trillion yen.

"Business conditions deteriorated," Panasonic said in a statement, listing as negatives the supply chain disruptions from the tsunami in northeastern Japan and the floods in Thailand.

It also blamed the European financial crisis for slowing demand and cited worries about a steady and cheap electricity supply as a concern.

The tsunami last year set off meltdowns at several reactors at a nuclear power plant and is putting the supply of cheap power at risk.

Panasonic lost 1.5 per cent to close at 570 yen in Tokyo.