Yen’s appreciation cuts deep into Sony’s ’99 pretax profits

Sony Corp. announced Friday that its 1999 consolidated pretax profit decreased 30 percent to 264.3 billion yen, mainly due to the appreciation of the yen during the business year that ended in March.

Sony also saw a 30.9 percent decline in its consolidated operating profit from the previous year to 240.6 billion yen, while sales declined 1.7 percent to 6.69 trillion yen.

As a result, the firm’s net profit dropped 31.9 percent to 121.8 billion yen, according to an earnings report.

However, a senior Sony official stressed that if the factor of the yen’s appreciation is excluded, Sony’s consolidated sales would have increased about 9 percent and its operating profit 39 percent.

By sector, sales of electronics products grew 1.1 percent to 4.72 trillion yen while operating profit declined 9.5 percent to 118.6 billion yen.

Sales in the video game sector dropped 16.5 percent to 654.7 billion yen and operating profit decreased 43.3 percent to 77.3 billion yen because consumers refrained from buying PlayStation to await the arrival of PlayStation 2, the updated version of the blockbusting video game console released in Japan in March.

PlayStation sold 18.5 million units in fiscal 1999, down 3.1 million units, while 1.41 million units of PlayStation 2 had been sold by the end of the business year since its introduction in March.

Sales in the music sector totaled 706.9 billion yen, down 6.8 percent from the previous year, while operating profit stood at 28.4 billion yen, down 22.4 percent.

Sales in the movie sector dropped 9.8 percent to 492.1 billion yen and operating profit decreased 10.1 percent to 38.6 billion yen.

In contrast, sales in the insurance sector grew 12.1 percent to 380.3 billion yen and operating profit increased 16 percent to 20.9 billion yen.