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Sharp returns to Q3 profit, keeps annual outlook

Sharp returns to Q3 profit, keeps annual outlook
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First Published: Wed, Feb 03 2010. 01 33 PM IST
Updated: Wed, Feb 03 2010. 01 33 PM IST
Tokyo: Consumer electronics maker Sharp Corp reported a swing to a quarterly profit on solid demand for LCD TVs and solar cells and maintained its annual profit outlook on Wednesday, in line with market expectations.
Sharp, the world’s fourth-largest LCD TV maker and a major supplier of display panels to other TV producers, has gained from strong flat screen TV demand in emerging markets such as China, which shored up panel prices and kept supplies tight.
But the cost of getting a new LCD panel factory in western Japan up and running held down profits in the latest quarter, Sharp said.
The factory uses so-called 10th-generation glass substrates, which are bigger than earlier-generation substrates, allowing it to make panels more efficiently amid tough price competition with rivals such as South Korea’s Samsung Electronics Co
“We saw strong LCD TV sales in Japan and China, where we sell high-margin products,” Sharp Director Tetsuo Onishi said on the sidelines of a news conference. “Of course cost cuts also helped.”
Sharp, which trails Samsung, Sony Corp and LG Electronics Inc in LCD TVs, kept its forecast for an annual operating profit of 50 billion yen ($552 million).
That would be a turnaround from a 55.48 billion yen loss a year earlier and roughly on a par with a consensus for a 51.4 billion yen profit in a poll of 20 analysts by Thomson Reuters I/B/E/S.
Global sales of displays used in LCD TVs will likely surge 40 percent to $49.2 billion this year amid a shift in demand to large and more advanced panels, research firm iSuppli said last week, boding well for Sharp and other electronics makers.
Operating profit was 21.0 billion yen in October-December, up from a 15.86 billion yen loss a year earlier.
Prior to the announcement, shares in Sharp closed down 0.4 percent at 1,132 yen, underperforming the Tokyo stock market’s electrical machinery index, which rose 0.4 percent.
Sharp shares have climbed 16 percent over the past three months, beating the subindex’s 9 percent gain.
Sharp competes with Sanyo Electric and Q-Cells in the solar cell market.
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First Published: Wed, Feb 03 2010. 01 33 PM IST