JAPAN: Japan's biggest electronics maker Hitachi forecasts a $7.8 billion loss for fiscal 2008

Record ID: 463710

  • Title: JAPAN: Japan's biggest electronics maker Hitachi forecasts a $7.8 billion loss for fiscal 2008
  • Date: 5th February 2009
  • Summary: (ASIA) TOKYO, JAPAN (FILE) (REUTERS) VARIOUS OF HITACHI SIGNS AND PRODUCTS AT CONSUMER ELECTRONICS PRODUCTS SHOW
  • Embargoed: 20th February 2009 12:00
  • Keywords:
  • Location: Japan
  • Country: Japan
  • Topics: Industry
  • Reuters ID: LVA5I84QSIC67SKFQXSJ8LX1VF6F
  • Story Text: Hitachi, Japan's biggest electronics maker, posted on Tuesday (February 3) a quarterly loss on struggling chip operations and a slump in demand for electronics products, and reaffirmed a forecast for a $7.8 billion annual loss -- which would be the biggest ever by a Japanese manufacturer.
    The spreading global recession is choking most of Hitachi's sprawling operations, with slumping car sales hurting its auto parts business, and its flat-TV division hit by steep price falls in a fiercely competitive market.

    "We believe the key for recovery would be housing and cars. Once people start buying those expensive items, money will start re-circulating in Japan and also around the world," Toyoaki Nakamura, Hitachi's senior vice president and CFO, told a news conference in Tokyo.

    "We hope to see profit in the next fiscal year of 2009, but no matter how many good products we produce, they don't sell until demand comes back," Nakamura added.
    The biggest headache is its 55 percent-owned semiconductor affiliate Renesas Technology, which has been battered by poor demand for chips used in cars, TVs, cameras and hard drives. The rest of Renesas is owned by Mitsubishi Electric.
    Hitachi has said it would exit unprofitable businesses, close plants and take other restructuring steps in a bid to cut 200 billion yen in fixed costs by March 2010.
    Hitachi booked an October-December net loss of 371 billion yen ($4.13 billion U.S. dollar) against a 12.5 billion yen profit a year earlier. The result was also dented by a firmer yen and a write-down of deferred tax assets after taxable income across the group fell.
    The company reported an operating loss of 14.5 billion yen in the October-December quarter after posting a profit of 77.9 billion yen a year ago. Sales fell 16 percent to 2.3 trillion yen.
    Hitachi, whose products range from rice cookers to nuclear reactors, repeated its projection for a net loss of 700 billion yen in the year to March.
    The warning, made on Friday, triggered a 17 percent dive in Hitachi shares to a near 29-year low, adding to a 50 percent slide since the beginning of the business year last April. The electronics machinery subindex tumbled 46 percent since April.
    The stock ended up 6.2 percent before the results, against a 1.9 percent gain in the subindex.
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