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Sony's Earnings Lower For Year

Unsettled economic conditions in most of its international markets caught up with Sony in its fiscal fourth quarter, leaving the giant entertainment conglomerate with a consolidated net loss for the period and lower earnings for the year.

For the three months ended March 31, Sony reported a net loss of $161.4 million, against year-earlier earnings of $204 million, while revenue of $12.3 billion fell 11.7%. For the full year Sony’s net was down 19.4% to $1.49 billion, while revenue edged up just 0.6% to $56.6 billion.

For the year, Sony’s key electronics sector had a 58.7% drop in operating earnings to $1.08 billion as sales dipped 0.5% to $38.9 billion.

Sony said results were impacted by weak sales in Eastern Europe, Russia, Asia and Latin America, lower margins stemming from price competition and reduced production levels, higher ad and R&D expenses, and higher service costs incurred by quality problems with cellular phones.

Audio sales declined 4.9% on soft regional demand, said Sony, and TV sales dipped 0.9%, despite strong demand for Wega direct-view TVs in the U.S. and Japan and for projection TV in the U.S.

Sales of video products rose 11.3% on good sales of DVD players in the U.S. and Europe, and generally strong demand for digital camcorders and still cameras.

Sales of video games rose 8.5% to $6.53 billion, and operating income was up 16.7% to $1.14 billion, as increased demand in the U.S. and Europe overbalanced a decline in console sales in Japan. Sony said it sold 21.6 million PlayStation consoles in fiscal 1999, up from the year-earlier 19.4 million, putting its cumulative sales total at $54.4 million.

Sales of information and communications equipment rose 2.2% as an improved performance for CD-RW drives and PCs offset the impact of lower demand for monitors and cellular phones.

Sony’s music business had higher sales but lower earnings, while its movie and TV programming segment had lower sales and higher earnings.

Total sales in the U.S. for the year edged up 2.6% to nearly $18 billion, including nearly all the $4.5 billion in volume from movies and TV shows and much of the $6.34 billion from Sony Music.