Sony sees turnaround in fortunes

Consumer electronics giant Sony Corp. revealed Monday that its group earnings for first half of the business year jumped to 101.2 billion yen.

The figure constitutes a significant turnaround from the net losses of 43.3 million yen reported by the firm a year ago.

While Sony’s group net sales during the half-year period recorded a relatively small surge of 2.8 percent to 3.51 trillion yen, improved profitability in the firm’s electronics and game divisions drove up the profit figure, company officials said.

According to an earnings report compiled in line with U.S. accounting rules, Sony’s consolidated operating profit during the April-September period came to 102.4 billion yen.

The firm posted losses of 388 million yen the same time last year.

Operating profit generated within the electronics division, which produces audiovisual equipment and semiconductors, jumped to 75.4 billion yen, against losses of 21.8 billion yen posted a year ago.

Sony’s game division, which produces PlayStation game consoles and software, logged a near 30-fold rise in operating profit to 27.4 billion yen.

Benefits arising from the company’s decision to merge with ailing affiliate Aiwa Co. drove up group net income by 36.1 billion yen, they said.

The merger is scheduled to take place in December.

In light of its one-time profit from the Aiwa merger, Sony revised its group net profit estimate for the full year to 180 billion yen.

It had forecast a full-year profit of 150 billion yen in July.

Citing the increasing uncertainty over the worldwide consumer market, however, the firm slashed its group sales target for the full year by 100 billion yen to 7.6 trillion yen.

Sony left its operating profit estimate intact at 310 billion yen, stating that cost-cutting efforts allied to changes in the dollar-yen exchange rate will help the firm to absorb an anticipated sales decline.

The company also unveiled Monday its earnings report for the second quarter.

Net group operating profit in the three-month period jumped to 50.5 billion yen, after a 3.4 billion yen loss the year before. Consolidated revenues inched up 0.5 percent to 1.79 trillion yen.

According to Sony, brisk sales of consumer audiovisual equipment and improved profitability in its semiconductor operations have helped bolster profits in the firm’s electronics division.

The game division also got a major profit boost from surging PlayStation2 sales.

Sony’s operating profit logged a 6.1-fold rise to 24.8 billion yen, Sony officials said.

While the movie division saw its sales grow 26.6 percent to 185.6 billion yen during the quarter, thanks to the box-office success of movies such as “Spider-Man” and “Men in Black II,” higher advertising and promotional expenses pushed down operating profit by 55.2 percent to 9.9 billion yen.