Tokyo – Sony reported a net loss and a double-digit percent
decrease in sales during its fiscal third quarter due to the Thailand floods,
exchange rates and TV sales and price declines.
Net loss attributable to Sony’s stockholders (excluding net income attributable
to non-controlling interests) was 159 billion yen ($2.038 billion) in the
quarter ended Dec. 31, 2011, compared year-on-year to net income of 72.3
billion yen in the same quarter of the previous fiscal year.
Sales were 1,822.9 billion yen ($23.4 billion), a decrease
of 17.4 percent compared to the same quarter of the previous fiscal year.
Sony blamed the impact of the floods in Thailand, which
began in October 2011, deterioration in market conditions in developed
countries, and unfavorable foreign exchange rates.
An operating loss
of 91.7 billion yen ($1.176 billion U.S. dollars) was recorded,
compared with operating income of 137.5 billion yen in the same quarter of the
previous fiscal year. This was primarily due to a significant deterioration in
equity in net income (loss) of affiliated companies, deterioration in the cost
of sales ratio, and a decrease in gross profit from significantly lower sales,
In its consumer products and services (CPS) segment, sales decreased 24.4 percent year on year
to 996.5 billion yen ($12.8 billion). Sales to outside customers decreased 25.3
percent year-on-year. This was primarily due to a decrease in LCD TV sales
reflecting price declines from deteriorating market conditions in Japan, Europe
and North America, the impact from the Thailand floods, and unfavorable
exchange rates, the company said.
operating loss of 85.7 billion yen ($1.09 billion U.S. dollars) was recorded,
compared with operating income of 63.5 billion yen in the same quarter of the
previous fiscal year. This was primarily due to deterioration in equity in net
income (loss) of affiliated companies, as well as a decrease in gross profit
due to lower sales and deterioration in the cost of sales ratio, partially
offset by a decrease in selling, general and administrative expenses, the
quarter, Sony recorded an impairment loss of 63.4 billion yen ($813 million) as
it sold off its shares of S-LCD to Samsung Electronics, resulting in
restructuring costs of 1billion yen ($13 million).
contributing to the deterioration in operating results — excluding the
restructuring charges and impairment loss — include LCD televisions,
reflecting a decline in unit selling prices that exceeded cost and expense
reductions, and the game business, reflecting higher marketing costs to promote
network service platforms and lower sales of PlayStation3 hardware due to a
strategic price reduction.
The financial condition of Sony only illustrates the
daunting challenge facing incoming president/CEO
, whose promotion from his post of executive deputy president was
announced yesterday and will take effect on April 1. Howard Stringer will
remain as chairman.
In its forecast for its fiscal year ending March 31, sales
are predicted to be 6,400 billion yen, down from November’s forecast by 1.5
percent and down 10.9 percent from the prior year’s actual results.
The net loss predicted is now 220 billion yen, higher than
November’s prediction of 90 billion yen and closer to actual loss of 259.6
billion yen from the prior fiscal year.