Pioneer Overseas CE Revenue Rises 5.6% - Twice

Pioneer Overseas CE Revenue Rises 5.6%

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Tokyo — A worldwide increase in sales of plasma displays, despite a decrease in sales of DVD players globally, accounted for a 5.6 percent rise in fiscal third-quarter home electronics segment overseas sales at Pioneer, hitting $645.2 million, up from $611.3 million in the year-ago period.

Overall third-quarter sales in the company’s home electronics segment, which primarily is CE products, jumped 6.2 percent, reaching $938.3 million, compared with $883.8 million in the same quarter in 2003.

However, intensified competition and a rapid decline in prices of plasma displays, DVD recorders and recordable DVD drives — as well as unfavorable yen-dollar, yen-euro exchange rates — resulted in an operating loss for Pioneer’s home electronics business, coming in at a negative $24.2 million for the three months, ended Dec. 31, compared with operating income of $77.2 million in the third quarter a year earlier.

Overseas sales in the company’s car electronics segment edged downward 2.1 percent in the third quarter, to $384.7 million from $393 million year-on-year, primarily due to a decrease in consumer sales of car audio products worldwide, despite a strong increase in sales of car navigation systems in North America. Total car electronics sales in the third quarter slipped even further, down 7.7 percent to $670.5 million from $726.6 million the previous year.

For the nine months, overseas sales in Pioneer’s CE business rose 4 percent to $1.5 billion from $1.4 billion, while total CE sales for the period increased 5.3 percent to $2.1 billion from $2 billion. For the nine months, the company reported a home electronics segment operating loss of $56.9 million, compared with operating income of $42.5 million year-over-year.

The car electronics business at Pioneer for the nine months increased 5.5 percent in overseas revenue, hitting $1.3 billion, up from $1.2 billion in 2003, while total segment revenue for the period moved up 3.1 percent to $2.2 billion from $2.1 billion in the previous nine-month period. Operating income for car electronics was $133.8 million in the nine months, down from $210.6 million in the same period the prior year.

Consolidated revenue at Pioneer for the third quarter was flat, inching downward by nearly 1 percent to $1.90 billion from $1.91 billion in 2003.

However, competition, downward pricing and currency devaluation were primary players in a decrease of operating income at Pioneer in the third quarter, down to $15.8 million from a year-ago $161.3 million. Falling market prices, a decrease in unit production and a write-down for disposal of inventories cut into third-quarter gross profit margin, leading to net income of $17.3 million, compared with $88.3 million in the same quarter the previous year.

For the nine months, Pioneer consolidated revenue rose 4.5 percent to $5.2 billion from $5 billion, but operating income dropped by more than half to $144.1 million from $331 million a year earlier. Net income came in at $63.7 million, down from $208.9 million in the same period in 2003.

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