Japanese appliance maker Sanyo Electric Co. decreased its profit forecasts for the year ending March 31, 2004, citing a heavy valuation loss on investments and assets, and sluggish demand for its home electric appliances such as refrigerators and washing machines.
The Japanese company cut its group net profit outlook to 3 billion yen (approx. U.S. $28 million) from 25.5 billion yen (approx. $238.5 million). It also projected a weaker group operating profit of 95 billion yen (approx. $888.5 billion), compared with its earlier estimate of 101 billion yen (approx. $944.7 million).
The downgrade of the net profit estimate stemmed mainly from additional extraordinary losses totaling about 15 billion yen (approx. $140 million), which include costs related to restructuring of its domestic home appliance plant and a valuation loss on its overseas group firms' assets, a Sanyo spokesman said.
Sanyo previously raised its group revenue forecast for this fiscal year to 2.5 trillion yen (approx. $23 billion) from 2.45 trillion yen (approx. $22.9 billion). The new outlook represents a 14.5 percent rise from last fiscal year.
Despite the profit warning, the company maintained its plan to pay a year-end dividend of 3 yen (approx. $0.02) a share. That will bring its total annual dividend to 6 yen (approx. $0.05) a share, unchanged from last fiscal year.
"Our audiovisual equipment operations are solid, but our home electric appliance operations aren't," said a Sanyo spokesman. Weak sales of home-use appliances including refrigerators and washing machines, as well as commercial- use refrigerators and air-conditioners, are the main reason for the cut to its group operating profit outlook, he said.
to Daily News