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Panasonic reported its consolidated financial results for the fiscal first quarter, ended June 30.
Consolidated group sales for the first quarter decreased 26 percent to 1,595.5 billion yen ($16.7 billion), from 2,152 billion yen ($22.5 billion) in the same three-month period a year ago, the company said. Of the consolidated group total, domestic sales amounted to 858.8 billion yen ($8.97 billion), down 18 percent from the year-ago period. Overseas sales decreased 33 percent to 736.7 billion yen ($7.7 billion).
Despite a visible sign of market stabilization in the electronics industry, Panasonic said, severe business conditions continued as the global recession and shrinking demand coincided with changes in the market structure, including a demand shift to emerging markets and lower-priced products.
It said it would rebuild its management structure “while preparing and taking action for future growth in fiscal 2010 as the final year of the GP3 plan.”
Panasonic described the four major themes of its GP3 plan: double-digit growth in overseas sales, four strategic businesses, manufacturing innovation and the “eco ideas” strategy.
The company also said it would implement drastic business structural reforms to rebuild its management structure, as well as “pursue penetration and internalization of 'Itakona,' acceleration of procurement cost reduction, reinforcement of comprehensive cost reduction efforts, and capital investment and inventory reductions.”
Operating loss for the first quarter was 20.2 billion yen ($211 million), down from operating profit of 109.6 billion yen ($1.14 billion) in the same period a year ago. This result was said to be due mainly to the effect of a sharp sales decrease and price decline, although the company reportedly implemented thorough streamlining of material cost and fixed cost reduction.