Japanese electronic makers on July 27 reported mixed performances for the quarter to June as sales remained brisk but product prices kept falling longer than had been expected.
Sharp posted a light dip in profits while Sanyo, which has already announced a restructuring, was stuck in the red in the first quarter but camera and office equipment maker Canon said its profits picked up 9% in the half-year to June.
Sharp posted a net profit of 19.14 billion yen (US$170 million) in the first quarter, down 0.8% from 19.47 billion yen a year earlier. Prices for many high-tech products including LCDs (liquid crystal displays) and digital cameras have been dropping, helping boost sales in some cases but also hitting corporate profits
"Delivery prices of our small- and mid-sized LCD panels fell by an annualized rate of 15% in the first quarter, whereas we had earlier thought prices would fall by 10%," Onishi said.
The situation was far more dire for rival Sanyo, which suffered a net loss of 26.21 billion yen (US$234 million) in the fiscal first quarter, reversing a year-earlier profit of 2.33 billion yen. Domestic sales fell 15% to 272.89 billion yen and overseas sales slipped 1.8% to 296.08 billion yen. Sales in the consumer segment fell 12.2% to 273.86 billion yen as "increased competition and a decline in prices led to a decrease in digital camera sales," Sanyo said in a statement, adding domestic mobile phone sales also fell.
Canon, reported strong growth in the first half to June thanks to brisk sales in digital cameras, LCD parts and other mainline businesses. Canon said its net profit grew 9.0% to 175.3 billion yen (US$1.56 billion) while sales increased in all three major markets -- Japan, North America and Europe.
Copyright Agence France-Presse, 2005