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Fri, Aug 01, 2008 - Page 10 News List

Hitachi sees profit in first quarter

HOPEFUL FORECAST The company was hit by losses last year as it restructured its flat-panel business, but it expects to stay in the black for the current fiscal year

AFP , TOKYO

Japanese electronics maker Hitachi Ltd said yesterday it had swung back into profit in the fiscal first quarter from a loss one year earlier on a recovery at its hard-disk drive business.

The group maintained its forecast to end the current year in the black.

Net profit came to ¥31.56 billion (US$292 million) in the three months to June against a loss of ¥13.62 billion a year earlier, a company statement said.

Operating profit more than tripled to ¥77.69 billion from ¥24.54 billion as revenue grew 2.7 percent to ¥2.54 trillion.

Hitachi was hit by widening losses last year as it restructured its hard-hit flat-panel business, but it expects to avoid red ink for the fiscal year to March with net earnings of ¥40 billion.

Operating profit is projected to rise 10 percent to ¥380 billion as revenue slips 1.1 percent to ¥11.1 trillion, the company said, all unchanged from its May forecasts.

Hitachi has struggled in the flat television market against stiff competition from bigger, rival manufacturers such as Matsushita Electric Industrial Co, Sony Corp and Sharp Corp.

Separately, Japanese technology leader Fujitsu Ltd said yesterday its operating profit nearly doubled in the quarter through June as strong sales of equipment to companies made up for a worse exchange rate.

Fujitsu said its sales exceeded expectations, but it maintained its full-year forecasts amid concerns over a weakening world economy and the stronger yen, which puts Japanese exports at a disadvantage.

The company reported ¥5.8 billion in operating profit for the three months through June, up 97 percent from the same period a year earlier.

Fujitsu said it had returned to black in the quarter, reporting a net profit of ¥300 million. It posted a net loss of ¥14.7 billion a year earlier on the one-off factor of a change in accounting practices.

Revenue inched up slightly in the quarter to ¥1.17 trillion.

“I am very pleased that we remain on target to meet our fiscal 2008 projections, despite growing economic uncertainty,” Fujitsu Ltd president Kuniaki Nozoe said in a statement.

He credited the company’s efforts to zero in on IT services and corporate customers as a niche to achieve profit.

“Companies need to improve their business processes on a continual basis in order to succeed in a more competitive business environment,” he said.

The company said that its revenue inside Japan in the technology solutions segment, which involves hardware and network sales, rose by 8.1 percent in the quarter largely because of building base stations for telecom carriers.

But sales in the same sector declined outside of Japan because of the rise in the yen over the past year, Fujitsu said.

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