Hitachi Ltd. on Wednesday revised downward its earnings forecast for the first half of fiscal 2002, blaming thinning profitability of industrial orders and the yen’s appreciation.
Hitachi had forecast a 5 billion yen group net profit for the period. It said it now expects consolidated net profit to come to zero for the six months through Sept. 30.
Group operational profit for the period is forecast to stand at 52 billion yen, down 18 billion yen from its initial forecast.
Hitachi officials said the company’s forecast for half-year group sales remains unchanged at 3.85 trillion yen.
The company blamed its poor showing on the falling profitability of major overseas orders and power equipment and waste processing plants in Japan. Its failure to deliver mobile phone handsets to the market — scheduled for release in May — was also listed as a contributing factor.
The appreciation of the yen caused currency exchange losses of 45 billion yen on a consolidated basis, Hitachi added.
However, the company said it will leave unchanged its fiscal 2002 group earnings forecast of 8.1 trillion yen in sales and 60 billion yen in net profit.
Victor to shut factory
YOKOHAMA (Bloomberg) Victor Co. of Japan will close down its factory in Fukushima in December in line with a planned move to halt production of parts for digital appliances and motors, the company said Wednesday.
The move, which will see 230 workers shifted, is part of a plan announced in January 2001 to pare JVC’s existing factories in Japan to 13 from 17 by fiscal 2003, company spokesman Satoru Imamura said.
By closing the Fukushima plant, Yokohama-based Victor will have met that target, he said.
JVC, which has posted losses in four of the past five years, expects to become profitable in the current fiscal year. The earlier-than-scheduled completion of the company’s factory closures shows that JVC is on track to meet its profit goal, one analyst said.
“Getting out of money-losing businesses and focusing on profitable businesses is the key to success,” said Kazumasa Kubota, an analyst at Okasan Securities Co. “Victor is actually keeping its promise for restructuring.”
Kubota rates JVC shares as “neutral minus.”
The company, which makes audiovisual equipment under the JVC brand, may sell the plant’s production equipment and stop producing motor parts, Imamura said.
Victor said in April that it expects to generate net income of 4.4 billion yen in fiscal 2002, compared with a loss of 44.6 billion yen a year earlier.
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