San Antonio — The Progressive Retailers Organization was at the Westin La Cantera Hill Coun
Recently issued fiscal year reports from four leading Japanese consumer electronics manufacturers — Toshiba, Pioneer, Hitachi and Sanyo — all illustrated the devastating effects of the worldwide recession, the increased value of the yen against foreign currencies and lower profit margins due to increased competition.
All four companies, including Sony (see p. 4), told similar tales, with each company suffering from their own unique problems outside of the general economic malaise for the fiscal year that ended March 31. Reports at press time indicated that Panasonic, which issued its fiscal-year financial last Friday, after our deadline, was also expected to report a major loss. (Visit www.TWICE.com for the Panasonic financial.)
Toshiba reported net sales of $67.9 billion (6,654 billion yen), down more than 1 billion yen. The net loss was $3.5 billion (343.6 billion yen), down by 471.0 billion yen.
In digital products business, which includes its consumer electronics operations, net sales were down 16 percent to 483.7 billion yen, and its operating loss for the fiscal year was 14.2 billion yen, from a profit of 29.2 billion yen from the prior year.
There were significant sales declines in TVs, hard disk drives and optical disc devices during the year due to the recession and rapid price declines, Toshiba said. Its PC business also saw a “notably decreased profit on lower sales.”
However Toshiba is projecting an increase in consolidated sales for fiscal year 2009 and a reduced loss for the company. In its digital products business, it is forecasting a return to profitability on a 1 percent drop in sales.
Pioneer, which is exiting the TV business this fiscal year, reported a higher net loss and a 27.8 percent drop in revenue and reiterated plans to revamp its car and home electronics businesses in the coming 12 months.
Pioneer reported a net loss of $1.33 billion (130.529 million yen), compared with a net loss of 19,040 million yen in the previous fiscal year. Its operating loss was $556.4 million (54,529 million yen), compared with an operating income of 9,216 million yen in the prior year.
Consolidated operating revenue was down 27.8 percent, compared with the prior year of $5.7 billion.
Car electronics operating revenue decreased 22.0 percent year on year to $2.98 billion because of lower sales of both car audio products and car navigation systems, partly due to lackluster auto sales worldwide, Pioneer said.
In car navigation systems, consumer-market sales declined year on year, mainly due to lower sales in North America, Japan and Europe. In car audio products, consumer-market sales decreased, mainly because of lower overseas sales. Total OEM sales in this segment accounted for approximately 41 percent of car electronics operating revenue in fiscal 2009, compared with approximately 39 percent in fiscal 2008.
Car electronics recorded an operating loss of $125.9 million (12,337 million yen) in fiscal 2009, compared with operating income of 26,101 million yen in fiscal 2008.
Home electronics operating revenue decreased 36.5 percent to $2.14 billion year on year. This was largely as a result of lower sales of plasma displays and DVD drives. Display product sales accounted for approximately 38 percent of home electronics’ operating revenue in fiscal 2009, compared with approximately 40 percent in fiscal 2008. This segment recorded an operating loss of $394.1 million (38,622 million yen) compared with an operating loss of 17,921 million yen in the previous fiscal year.
In its financial statement Pioneer reiterated layoffs, partnerships with Mitsubishi and Sharp, and the $25.8 million dollar investment Honda made in the CE maker, and other cost-cutting goals.
Hitachi, which dramatically scaled back CE operations in the U.S., reported a net loss for the fiscal year was $8.03 billion, or 787.33 billion yen. The prior year’s net loss was 58.1 billion yen. Consolidated revenues were $102 billion, down 11 percent year over year with its digital media and consumer products businesses.
In its digital media and consumer products unit, revenues declined 16 percent to $12.9 billion and its operating loss year on year was $1.08 billion, or 105.5 billion yen, a 4.3 billion yen improvement over the previous year, Hitachi said.
Lower sales in the business unit reflected lower sales volumes for flat-panel TVs overseas as part of business structural reforms, as well as lower sales of optical disc drives and other digital media products and room air conditioners due to the sudden drop-off in demand from October 2008.
And Sanyo Electric, which is in the process of being acquired by Panasonic, reported a net loss of about $970 million in its fiscal year compared with a net profit of $291 million in the prior year. In fiscal year 2008 Sanyo said its profit in the prior year included the sale of operations such as the mobile phone business.
Consolidated net sales total was more than $18 billion, a decrease of 12.2 percent in yen compared with the previous year.