Panasonic Corp widened its annual net-loss forecast to a record ￥780 billion (US$10.2 billion), making it the latest Japanese electronics company to predict declining earnings because of Thai floods and a slow economy.
The revision, which includes restructuring charges, compares with the ￥420 billion loss Panasonic predicted in October last year. The loss in the 12 months ending next month will be the biggest since Osaka-based Panasonic was founded in 1918, exceeding the ￥427.8 billion in March 2002.
The world’s largest manufacturer of plasma TVs joins domestic peers Sony Corp and Sharp Corp in increasing loss forecasts as they struggle to cope with a slow global economy that is hurting sales after the Thai floods and the March 11 earthquake in Japan crippled plants and suppliers. Panasonic booked a ￥290 billion charge for goodwill writedown, with ￥250 billion stemming from its purchase of Sanyo Electric Co.
“The consumer electronics business and components business are below the company’s plan due to weaker fundamentals and a stronger yen,” Jeff Loff, a senior analyst with Macquarie Capital Securities in Tokyo, said before the announcement.
Operating profit will likely total ￥30 billion in the year ending next month, compared with the company’s previous forecast of ￥130 billion, Panasonic said. The company cut its forecast of annual revenue to ￥8 trillion from ￥8.3 trillion.
The company cuts its capital expenditures plan to ￥300 billion from ￥320 billion.
For the three months ended Dec. 31, the company reported a net loss of ￥197.6 billion, compared with the ￥3 billion average of four analyst estimates compiled by Bloomberg.
The maker of Viera televisions and Lumix cameras halted operations in October at its three factories in Thailand making home appliances and other products following the nation’s worst floods in 70 years. The world’s No. 4 TV maker cut its annual sales target to 18 million sets.
The company is boosting output and buying more parts overseas as gains in the yen make it more expensive to manufacture in Japan.
Global liquid-crystal-display TV shipments probably gained 8 percent to 206 million units last year, falling short of an earlier projection of 211 million units, according to an October forecast by DisplaySearch. The shipments rose 13 percent in the quarter ended Dec. 31 from a year earlier, according to the researcher, which estimates annual shipments to rise 10 percent this year.
Panasonic will invest ￥45 billion to build a plant for solar cells and modules in Malaysia, the company said in November. The company, which also makes microwave ovens, rice cookers and cordless drills, is shifting its procurement base to Singapore from Osaka to buy more parts in Asia.