Oki Electric Industry Co. said Tuesday the company is likely to suffer an after-tax loss of 31 billion yen in the current business year to March 1999, due to sagging semiconductor prices and lower demand for telecommunications devices.
As a result, the company will not pay a dividend this year. Oki paid out 7 yen per share last year, the company said. Oki Electric is the latest of a string of major electronics firms to revise their profit forecasts downward for the current business year.
To resuscitate the company by the year 2001, Oki also announced a major restructuring plan, which includes halting mass production of 128-megabit and 256-megabit dynamic random access memory chips and slashing executives bonuses by an average of 10 percent starting next month. As for its forecast for the mid-year business results, Oki Electric expects to post pretax losses of 25 billion yen and net losses of 20 billion yen.
According to its restructuring plan, Oki will carefully shift future investment to non-DRAM businesses, such as development of high quality large-scale integration. As a result, the percentage of DRAM sales in the company's overall sales will decline from 30 percent the current business year to 15 percent in the 2000 business year.