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JVC CE Segment Sales Off

2/05/2004 02:42:00 PM Eastern

Yokohama, Japan — Strong second-half sales of projection televisions and digital video cameras at Victor Company of Japan (JVC) wiped out an 18 percent year-on-year decline, helping company sales to the Americas recover in the third quarter.

Overseas sales at JVC were flat in the third quarter, hitting $1.69 billion, up from $1.68 billion in the third quarter of 2002, while slumping sales in the Americas resulted in 0.2 percent year-on-year growth increase. For the nine months overseas sales dipped 4 percent, to $4.6 billion, from $4.8 billion.

Total sales for JVC’s consumer electronics division in the company’s fiscal third quarter, ended Dec. 31, edged downward 1.3 percent, to $1.76 billion, from $1.78 billion in the year-ago period. For the nine months, consumer electronics segment sales were off 7 percent, coming in at $4.7 billion, compared with $5 billion in the same nine months in 2002.

In JVC’s software and media products division — which includes music and video software, such as CDs, videodiscs, prerecorded music and video tape, as well as blank media — third quarter sales slid 13 percent, down to $404.8 million, from $467.5 million year-on-year. For the nine months, software and media products segment sales dropped 10 percent, reaching $1.2 billion, from $1.3 billion in the same time frame a year ago.

In terms of overall product trends at JVC, digitization accelerated as sales grew for DVD players, projection TVs and digital video cameras, while sales slumped for CRT televisions, VCRs and VHS-C video cameras.

This product tracking translated into a 1.8 percent consolidated third-quarter sales slide at JVC, coming in at $2.48 billion, compared with $2.52 billion in the same three months a year ago.

Raw cost improvements, more favorable foreign exchange rates and fixed-cost reductions — despite adverse factors such as falling prices and lower sales in the components and devices division — translated to a 43 percent increase in consolidated operating income for the third quarter, to $94.9 million, from $66.2 million.

Although total sales were off, JVC registered a 43 percent gain in consolidated net income in the third quarter, hitting $65.1 million, from $45.5 million year-over-year.

For the nine months, consolidated JVC sales decreased 5 percent, to $6.9 billion, from $7.2 billion a year ago. Operating income jumped 27 percent in the period, reaching $192.2 million, up from $150.9 million. Net income rose 68 percent for the nine months, hitting $98.4 million, compared with $58.7 million year-over-year.

JVC expects to notch a 3 percent increase in consolidated sales for the full fiscal year, ended in March, reaching $9.5 billion. Net income should increase 74 percent for the 12 months, climbing to $104.3 million.