Tokyo: Panasonic Corp reported a record quarterly net loss on Friday, battered by weak demand, price falls and restructuring costs, and the Japanese electronics maker forecast a bigger-than-expected loss this year.
The company, which vies with Sony Corp for the title of the world’s largest consumer electronics maker, saw its profitability deteriorate as the global recession prompted consumers to cut spending on flat TVs and digital cameras.
Japanese companies such as Sony, Panasonic and Sharp Corp have suffered an additional blow as the yen’s strength made their products less price competitive overseas.
To tackle the weak economic climate, Panasonic had said in February it would cut 15,000 jobs and close 27 manufacturing sites, increasing its restructuring costs for the past business year and hitting its profits.
The world’s No.1 plasma TV maker ahead of Samsung Electronics Co said on Friday it expects a net loss of ¥195 billion ($2 billion) for the business year to March 2010, against a consensus for a loss of ¥105.4 billion in a poll of 17 analysts by Thomson Reuters.
Panasonic is in talks with regulators to obtain approval for its planned tender offer for smaller rival Sanyo Electric Co Ltd.
Panasonic, which competes with Canon Inc and Sony in digital cameras and camcorders, said that its net loss totalled ¥444.3 billionn in January-March, down from ¥61.6 billion profit a year earlier.
Besides anaemic demand and steep price declines of TVs, digital cameras and other consumer electronics products, Panasonic, a major car electronics supplier, was also hit by slumping auto sales worldwide.
Panasonic shares rose 4.8% ahead of the results, outperforming a 3.7% rise in the Tokyo market’s electrical machinery index.