Toshiba Reports CE Sales Slid 3% During Fiscal Yr.

By Jeff Malester -- TWICE, 4/27/2004

Tokyo — The digital products segment at Toshiba, mainly consumer electronics, recorded a sales decline and an operating loss for the 12 months, primarily on lower sales of personal computers, televisions and cellular phones.

Sales slipped 3 percent in the CE segment for the year, down to $18.9 billion from $19.1 billion in the year-ago period. Operating income in the CE segment reversed from year-over-year, when this reached $228.5 million in the previous 12 months, compared with a loss of $224.6 million in the fiscal year, ended March 31.

PCs suffered severe price erosion in the past 12 months, while sales of projection TVs in North America were sluggish in the face of intensified competition that pushed down unit sales prices. Falling sales in overseas markets produced a decline in sales of cellular phones.

In the fourth quarter, sales of CE products decreased 2 percent, down to $4.9 billion, while operating income increased to $114.5 million, about doubling the $61 million recorded in the same three months the previous year.

Toshiba sales to North America declined 15 percent for the 12 months to $6.5 billion from $7.4 billion. Operating income in the segment dropped 56 percent to $62.3 million for the 12 months, compared with a year-over-year $107.9 million.

Both sales and operating income for the CE segment are expected to climb in the current fiscal year, through March 2005, with sales rising 11 percent to $20.6 billion and operating income increasing nearly 49 percent to $230 million. The increases are based on the strength of new PC product introductions and improvements in the company’s business structure.

Consolidated Toshiba year-end sales were down slightly to $52.6 billion, while operating income jumped 51 percent to $1.6 billion from $1.1 billion. However, results from the previous year included sales of about $1.6 billion from businesses that are no longer included in consolidated results, and operating income this year included a $449.9 million gain for an employee pension fund transfer to the Japanese government.

Net income for the 12 months came in at $271.9 million, compared with $95 million year-over-year, a 56 percent rise.