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Sony’s above-forecast profit underscores turnaround, preliminary report shows

Bloomberg

Sony Corp. Chief Executive Officer Kazuo Hirai is showing the turnaround at the multinational conglomerate was no fluke.

The company reported a preliminary operating profit of ¥285 billion for the fiscal year through March 31, 19 percent higher than its previous forecast, according to a statement Friday. It also said net income would be about ¥73 billion, more than twice the previous forecast.

It marks the second straight year operating profit has topped $2 billion, the longest such streak since 2001. The company cited strong performance across most businesses and cost-savings in its insurance unit. Its chips division also saw lower expenses after a faster-than-expected recovery from last April’s earthquakes.

“This will strengthen the market’s confidence going into the next fiscal year,” said Kazunori Ito, an analyst at Morningstar Investment Services. “Despite the strengthening yen, the fact that chips were mentioned in this release means they probably contributed quite a lot to this upward revision.”

Sony, which plans to release final earnings on April 28, left its revenue outlook unchanged at ¥7.6 trillion. Shares trading in Germany rose 1.9 percent after the results, more than the 0.6 percent the stock rose in Tokyo prior to the announcement. Sony is up 9.7 percent so far this year through Friday in Tokyo trading.