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Panasonic Turns To Profit In Q3, Backs Full-year Forecast

Japanese consumer electronics giant Panasonic Corp. (PC: Quote) reported a profit for the third quarter, compared to a loss last year, amid lower costs and a weaker yen, even as revenues dropped from the prior year. However, for the nine-month period, loss widened due to some higher valuation allowances for deferred tax assets and a provision for income taxes.

Net income attributable to the company for the third quarter was 61.34 billion yen, compared to a loss of 197.67 billion yen in the prior-year quarter. Pre-tax income amounted to 9.3 billion yen, in comparison with a 191.2 billion yen loss a year ago.

Consolidated quarterly group sales slid 8 percent to 1.8 trillion yen from last year's 1.96 trillion yen. Domestic sales dropped 12 percent to 917.2 billion yen, while overseas sales slid 3 percent to 884.3 billion yen.

In the quarter, cost of sales declined 10 percent to 1.34 billion yen. Expenses associated with the implementation of early retirement programs dropped to 8.61 billion yen from 37.65 billion yen in the prior year.

For the nine-month period, net loss attributable to the company widened to 623.83 billion yen from 333.82 billion yen, due to higher valuation allowances for deferred tax assets and a 412.5 billion yen provision for income taxes. However, operating profit increased due to fixed cost reductions and streamlining material costs.

Group sales dropped 9 percent to 5.44 trillion yen from last year, amid weak demand for flat panel televisions and BD recorders. Domestic sales fell 9 percent, while international sales dropped 8 percent.

In AVC Networks, sales decreased 23 percent to 1.08 billion yen due to sales decline in flat-panel TVs, BD recorders and digital cameras.

Appliances sales edged up 1 percent to 1.2 billion yen. While air conditioner sales declined, sales of refrigerators and washing machines were higher.

Sales declined 15 percent in Systems & Communications to 509.8 million yen, due to lower sales of mobile phones and system-related equipment.

In Automotive Systems, sales climbed 28 percent to 571.7 million yen, amid strong growth in car AVC equipment and car navigation systems.

Industrial Devices sales slid 5 percent to 1.03 billion yen, as sales dropped in optical pickups and semiconductors.

In October 2012, the company revised its original sales forecast of 8.1 trillion yen for fiscal 2013 to 7.3 trillion yen. Pre-tax loss was forecast to be 365 billion yen. Net loss attributable to the company was expected to be 765 billion yen.

Panasonic said today that its forecast for fiscal 2013 remains unchanged.

Separately, Panasonic said it has decided to dissolve the alliance with Minebea Co., Ltd. The firm has reached an agreement with Minebea and would promptly transfer all its shares in their joint venture of Minebea Motor Manufacturing Corporation to Minebea. This will have no effect on the outlook for the year.

Minebea Motor was set up on April 1, 2004, integrating the fan motor, stepping motor, vibration motor, and DC brush motor business of Minebea and Panasonic, to develop a globally competitive business.

The stock closed down 1 percent on Friday at 592 yen.

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by RTT Staff Writer

For comments and feedback: editorial@rttnews.com

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