Sharp to log first-ever operating loss: report

Agence France-Presse

Posted at Feb 04 2009 11:07 AM | Updated as of Feb 04 2009 07:16 PM

TOKYO - Japanese electronics firm Sharp Corp. is expected to mark its first-ever operating loss in the current business year to March as sales tumble amid deepening global economic woes, a report said Wednesday.

Sharp is likely to post an operating loss of more than 10 billion yen ($111 million), a reversal of the 183.6 billion yen profit from the previous year, the Nikkei business daily said without naming its sources.

It would be Sharp's first-ever loss since it started releasing earnings on an operating basis -- profits after subtracting general operating costs from revenue -- in 1953.

The Nikkei also said the company was expected to log a net loss of almost 100 billion yen in a turnaround from a net profit of 101.9 billion yen last year.

Sharp is struggling as the global economic downturn has stifled demand for liquid crystal display (LCD) televisions and sent prices lower, The Nikkei said.

The company hopes to reduce inventory stockpiles of LCD TVs and panels to desirable levels by the end of the current financial year on March 31 to help improve future profitability, the daily added.

Sharp did not confirm the report, saying it would announce October-December results on Friday.

The company added that it will also reveal Friday whether it has revised outlooks released in October, when it cut its operating profit outlook to 130 billion yen, down from 195 billion previously projected, due to weak sales of mobile telephones.

It also slashed its net-earnings forecast to 60 billion yen from the earlier estimated 105 billion yen, ending a five-year record breaking streak.

The company also said in December it would book 43.2 billion yen of extraordinary loss as the value of an unspecified financial investment plunged.