Panasonic losses spiral to £3.4bn

Panasonic's January-March losses ballooned 10-fold to 438 billion yen
(£3.4 billion), completing a year of record red ink at the Japanese
electronics maker battered by natural disasters and an ailing TV
business.

The firm racked up a 40.7 billion yen loss for the same period the previous year.

The Osaka-based maker of Viera TVs and Lumix digital cameras reported today a record loss of 772.2 billion yen (£6 billion), a reversal from the 74 billion yen (£580 million) profit a year ago and among the biggest in Japan's manufacturing history.

That comes a day after Panasonic's arch-rival Sony racked up a record annual loss of 457 billion yen (£3.55 billion) in its fourth straight year of red ink.

Sony, which makes the Walkman portable audio player and PlayStation game machine, had a 255 billion yen (£1.98 billion) loss over January-March - its fifth straight quarterly net loss to round out a fiscal year that was the worst in its 66-year corporate history.

Both companies' TV operations, centring around flat-panel sets, have been battered by a powerful Samsung Electronics Co of South Korea and other Asian players.

A strong yen has also eroded the value of overseas earnings for the Japanese.

Like Sony, which is hoping for a turnaround under a new president, Kazuo Hirai, Panasonic has tapped Kazuhiro Tsuga as president. The appointments still need shareholder approval.

Panasonic is forecasting a return to profit for the fiscal year ending March 2013, at 50 billion yen (£390 million) profit on 8.1 trillion yen (£60 billion) sales, up 3 per cent.

Panasonic does not have the entertainment or gaming businesses of Sony. But it is struggling as it attempts to strengthen solar panel and battery operations, including auto batteries, to find new areas of growth.

Panasonic's sales fell in every major region, including the US, Europe, Japan, China and the rest of Asia.

AP