Sony yesterday highlighted the depth of its problems by cutting its operating profit outlook for the year by 81 per cent as it reported its first results since Sir Howard Stringer was appointed chief executive.
The Japanese electronics, games and media group announced a Y15.3 billion (€100 million) first-quarter operating loss and said continuing problems in its core consumer electronics business had forced it to review its forecast.
The results were released after the close of trading in Tokyo but, by midday in New York, Sony's American Depositary Receipts had fallen 4.2 per cent to $32.72.
The group now expects operating profits to be Y30 billion rather than the Y160 billion previously forecast. If an exceptional gain of Y60 billion related to its pension fund were excluded, Sony would post an operating loss for the year.
The forecast includes increased restructuring costs of Y88 billion but Sony said the full-year outlook did not include any impact from an accelerated restructuring programme it plans to announce next month - indicating there could be additional expenses.
The dismal outlook reflects the continuing pain in Sony's electronics division, which is expected to post an operating loss for the third consecutive financial year as prices of key products such as televisions and DVD recorders continue to fall.
The games division suffered a first-quarter operating loss of Y5.9 billion in spite of strong sales growth, due to higher marketing and development costs related to PlayStation 3. - (Financial Times Service)
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