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Net loss at Renesas balloons to ¥168 billion

Kyodo

Renesas Electronics Corp.’s group net loss expanded to ¥167.58 billion in the business year ended in March on sluggish sales and hefty restructuring costs, the struggling chipmaker said Thursday.

Renesas posted a ¥62.60 billion loss the year before.

The manufacturer of microcontrollers and other semiconductor products for automakers and electronics makers said that its group operating loss had narrowed to ¥23.22 billion, compared with ¥56.75 billion the previous year, on sales of ¥785.76 billion, down 11.0 percent.

The company did not release its earnings projection for the current business year but said it will do so after Innovation Network Corp. of Japan, a government-backed corporate turnaround body, and eight of its top clients, including Toyota Motor Corp., complete their investments in the company.

Renesas is set to receive investments worth ¥150 billion to improve its deteriorating financial profile.

In fiscal 2012, the company said semiconductor sales dropped 7.8 percent from the previous year amid continued stagnation in the global market, leading to a fall in sales in chips used to make personal computers, consumer electronics and other products.

It also booked a special loss of ¥133.9 billion to carry out restructuring, including the consolidation of manufacturing plants and the launch of an early retirement program in Japan.

But in the January to March quarter, Renesas managed to post an operating profit of ¥8 billion, rebounding from a loss of ¥7.9 billion the previous quarter, as the benefits of a newly weakened yen and cost-cutting efforts more than offset the adverse impact of slowing sales, the company said.

“Regarding the market conditions of semiconductors, they are likely to recover in the first and second quarters, though the pace is gradual,” said President Tetsuya Tsurumaru at a news conference in Tokyo.

Also on Thursday, the company announced that its board had decided to name Omron Corp. Chairman Hisao Sakuta as its chief executive officer and chairman. Sakuta is expected to assume the posts after a general shareholders’ meeting slated in June, the company said.