Japan’s NEC posts loss, Sanyo returns to black

Japanese electronics firm NEC Corporation said yesterday its net loss deepened from a year earlier for the three months to June because of a reorganisation of its semiconductor business.

NEC said its group net loss widened to 43.1 billion yen ($491 million) in the fiscal first quarter from 33.8 billion yen a year earlier.

The company booked a special loss of six billion yen as it undergoes reorganisation to spin off its semiconductor unit, NEC Electronics, whose loss-making performance had long been dragging on NEC’s bottom line. NEC Electronics merged with unlisted Renesas Technology on April 1 to create the world’s third-largest semiconductor company by sales.

The exclusion of the chip-making unit subtracted semiconductor sales from NEC’s group results, but helped improve its operating profit.

NEC’s group revenue dropped 14.2 per cent to 667.5 billion yen, but its operating loss for the quarter narrowed to 23.2 billion yen from 40.0 billion yen.

For the current fiscal year through March 2011, NEC continues to expect a net profit of 15 billion yen and operating profit of 100 billion yen on revenue of 3.3 trillion yen.

Separately, Sanyo Electric Co. said yesterday that it returned to profit in the first fiscal quarter, posting 10.6 billion yen in the three months to reverse a loss of 18.4 billion yen a year earlier on brisk solar battery sales.

For the first half ending September 30, the company raised its net profit outlook to 16 billion yen from a break even outlook.

Panasonic secured a controlling stake in Sanyo in December amid a wave of operational streamlining by Japan’s high-tech giants as they sought to recover from a severe industry slump sparked by the global economic downturn.