Japan’s Sharp plunges on loss

JAPAN’S Sharp plunged in Tokyo on Monday following a report that said the consumer electronics giant would fall back into the red, reversing company forecasts for an annual profit.

The firm fell more than nine percent at one stage before finishing the morning session down 6.75 percent at 235.0 yen.

Japan’s leading Nikkei business daily said the Osaka-based firm would report a loss that could amount to hundreds of millions of US dollars for the fiscal year through March owing to a slump in its struggling television business.

The company declined to comment on the report but it said its full-year earnings would fall below earlier forecasts due to a “deterioration” in sales at home and “severe competition” in the liquid crystal display business. It did not give new figures.

Sharp, which along with rivals Sony and Panasonic has been undergoing a painful restructuring to move past years of losses, had earlier said it was on track to report a 30 billion yen annual net profit.

Japanese electronics firms have struggled in recent years as huge losses in their TV units weighed on their bottom line, although a sharply weaker yen has helped to boost the value of overseas earnings.

The companies have faced severe competition in the sector from lower-cost rivals, including those in neighbouring South Korea and Taiwan.