Following on from Sony’s dismal revenue results earlier in the week, another Japanese giant, Panasonic, has predicted that it will make an even bigger loss of ¥780 billion (£6.5bn) for the fiscal year 2011.
This huge loss is by far the biggest in the companies history and almost eclipses the record loss posted by Hitachi of ¥787bn for the fiscal year 2009. Like Sony, Panasonic is laying the blame for such a high loss at the feet of the flooding in Thailand, a strong yen and a slowly demand for TV sets.
Another reason for Panasonic posting a large deficit was the ¥250bn (£2.1bn) write down following the buyout of Sanyo, Japan's largest battery maker, during the year. The predictions from Panasonic came as the company was reporting its Q3 2011 financial results, which showed a net loss of ¥197bn (£1.6bn) for the three months to the end of December.
The 94-year-old company’s previous largest annual loss was ¥428bn (£3.5) in 2002 and Panasonic, which is the world’s largest maker of plasma TVs, is said to be reorganising away from its traditional base in consumer electronics and moving more towards solar panels and rechargeable batteries following the purchase of Sanyo.
With Sony, Sharp and now Panasonic all predicting full year losses in multiple billions, it is clearly a tough time for Japanese TV makers. Panasonic, the world’s fourth largest TV maker, has cut its annual sales target to 18 million sets.
In October, Panasonic announced a reform plan for its TV and chip operations. The company is suspending two TV display plants in Japan, scrapping plans to relocate panel facilities to China and writing off some value of plants making TV displays and semiconductors.