Panasonic may beat its full-year earnings forecast
The Osaka-based company plans restructuring spending of 250bn yen through March 2015
Panasonic is headed for its first annual profit in three years as president Kazuhiro Tsuga deepens restructuring to revive the electronics maker after back-to-back losses totalling to 1.5 trillion yen. Photograph: Reuters/Yuriko Nakao
Panasonic, Japan’s second- largest television maker, may beat its full-year earnings forecast as a weaker yen lowers the price of its products in export markets.
“We’re seeing better numbers than we had anticipated,” president Kazuhiro Tsuga, said yesterday. The company in July forecast net income of 50 billion yen for the year ending March 2014. Panasonic is headed for its first annual profit in three years as Mr Tsuga deepens restructuring to revive the electronics maker after back-to-back losses totalling to 1.5 trillion yen.
The Osaka-based company plans restructuring spending of 250 billion yen through March 2015 to end losses in operations for TVs, semiconductors, mobile phones and optical devices. The Japanese currency has declined about 21 per cent against the US dollar in the past 12 months as Prime Minister Shinzo Abe uses fiscal and monetary policy to try and revive economic growth.
Mr Tsuga, who took the top job in June 2012, also cited higher sales of electric-car batteries and housing systems for the better-than-anticipated earnings. An expected rise in Japan’s consumption tax has boosted large-sized spending for housing and will probably help the sale of whitegoods, the executive said. Japan’s feed-in-tariff system is also boosting sales of solar power systems, he said.
Japan is due to raise the nation’s 5 per cent sales tax to 8 per cent in April before an increase to 10 per cent in October 2015 to curb the world’s heaviest debt load. Mr Abe will decide whether to go ahead with the plan after the October 1st release of the Bank of Japan’s quarterly Tankan survey of business confidence. Japan’s solar market is booming thanks to an incentive program that pays above-market rates for power produced from renewable sources such as the sun and wind. Introduced in July 2012, the program is intended to diversify the country’s energy mix following the 2011 Fukushima disaster. – (Bloomberg)