WORLD CUP PROVIDES LIFT

Matsushita battles its way to profitability

Matsushita Electric Industrial Co. said Wednesday it posted a group net profit of 17.85 billion yen in the first half, marking a turnaround from a loss of 69.47 billion yen a year earlier and returning to profitability for the first time in two years.

The consumer electronics giant attributed its strong performance in the business year to Sept. 30 to brisk sales of audiovisual products, including televisions, camcorders and DVD players, during the World Cup soccer finals.

The Osaka-based firm manufactures products under the Panasonic and National brands.

Matsushita’s operating profit during the period came to 45.37 billion yen, up from a loss of 75.71 billion yen in the same period a year earlier, according to consolidated earnings reports complied under U.S. accounting rules.

Group sales posted a year-on-year rise of 4.5 percent to 3.54 trillion yen.

The firm, which has vowed to return to the black in 2002, is battling its way out of the worst year in its corporate history after racking up a group net loss of 431 billion yen.

Sales of audiovisual and communications products were up 6 percent from the same period the previous year to 2.06 trillion yen.

The components and devices segment grew to 747.8 billion yen from a year earlier, thanks to strong demand in Asia for semiconductors and other devices.

Home appliances meanwhile fared poorly, due mainly to a slowdown in sales of air conditioners and downward price pressure in stores. Sales in this segment fell 2 percent from a year earlier to 595.1 billion yen.

Matsushita said growing uncertainty over the economy, especially in the U.S., has cast a pall over its prospects for the second half. The firm revised its initial group sales target for the entire year to 7.05 trillion yen, down 30 billion yen from initial projections.

“Predicting the U.S situation has never been harder,” said Tetsuya Kawakami, senior financial officer of Matsushita. “Usually, we have orders confirmed around this time of year, but not this year.”

Nevertheless, Matsushita said it will leave unchanged its initial estimate for group operating profit of 100 billion yen for the full year, well up from an operating loss of 211.81 billion yen in 2001. The company projects a full year group net profit of 37 billion yen, up from a net loss of 431 billion yen the previous year.