Electronic and electric goods company Panasonic Corp. (PC) Tuesday reported a 16% decline in its second-quarter profit, hurt by lower revenues, a stronger yen, and the negative impact of competitive prices. In addition, Panasonic, which recently changed its name from Matsushita Electric Industrial Co. Ltd., continues to maintain its full-year forecast.
The Osaka, Japan-based company's second-quarter net income declined 16% to 55.46 billion yen from 65.81 billion yen in the year-ago quarter. Net income per basic common share was 26.72 yen, down from 30.99 yen last year, same as net income per American Depository shares, or ADS.
Net income decreased primarily due to the negative effects of the intensified global price competition, the strengthening of the yen against the U.S. dollar, and the rising prices for crude oil and other raw materials, the company noted.
The company's operating profit in the second quarter amounted to 118.6 billion yen, 19% below 146.1 billion yen reported in the previous year's quarter.
Consolidated group sales for the company decreased 4% to 2.19 trillion yen from 2.29 trillion yen in the comparable quarter a year ago.
The company said its total sales slid due to sluggish sales of its information and communication equipment that went down by 10% in 2008, as well due to the inclusion of sales of JVC, or Victor Co. of Japan, Ltd. and its subsidiaries, in the last year. However, in digital AV products and white goods, the company registered an 11% growth in sales.
The company noted that from August 2007 JVC became associated companies under the equity method from being its consolidated subsidiaries.
Of the total sales reported, domestic sales edged down 4% to 1.07 trillion yen, whereas overseas sales slid 4% to 1.13 trillion.
For the six months ended September 30, 2008, Panasonic posted net income of 128.49 billion yen, 22% higher than the 105.1 billion yen reported in the six-month period last year. Net income per common share increased to 61.58 yen from 49.32 yen in 2008. Year-to-date consolidated group sales decreased 4% to 4.34 trillion from 4.53 trillion yen in the year-ago period.
Panasonic's inventory position as of September 30 increased due to seasonal factors and a decrease in cash and cash equivalents.
In addition, the Board of Panasonic has resolved to distribute an interim or semiannual, cash dividend amounting to 22.5 yen per share. The dividend will be distributed on November 28 to shareholders of record on September 30. The company also plans to distribute another cash dividend of the same amount at the year end to shareholders on register on March 31, 2009.
Looking ahead, Panasonic noted that the current financial turmoil originating from the U.S. is widespread globally and there are sharp fluctuations in exchange rates and stock prices. As such, the company expects the outlook of the business environment to be uncertain from the third quarter onwards.
The company therefore said it is maintaining its previously announced fiscal 2009 consolidated sales forecast of 9.2 trillion yen, operating profit increase of 8% to 560 billion yen, and net income increase of 10% to 310 billion yen.
PC closed Monday's regular trading on NYSE at $13.16, down $0.64, or 4.64%, with a volume of 285,942 shares.
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June 05, 2026 16:18 ET A busy week for economic news flow saw a slew of reports being released that reflected the trends in the U.S. labor market. In Europe, economic growth and inflation data gained attention as the European Central Bank and Bank of England head for policy session later in the month. In Asia, the monetary policy session of the Indian central bank was in focus as the country, a major oil importer, reels under the pressures of a weaker rupee and rising inflation.