Panasonic is braced for a £3.4bn loss as it takes a hit from restructuring

Steve Dinneen
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PANASONIC is braced for a £3.4bn quarterly loss, its worst in a decade, as it struggles against the soaring yen and weak demand for flatscreen TVs.

The loss, which compares to a £588m profit a year earlier, includes costs associated with a large-scale restructuring that will see it shed 17,000 jobs by 2013.

Panasonic, which says it aims to shake off losses at its TV business, cut its full-year profit forecast from £2.1bn to £1bn. It also slashed its estimate for annual TV sales from 25m to 19m.

Chief financial officer Makoto Uenoyama said: “What we need to tackle is the TV businesses. If we downsize this, our profits will be completely different.”

Meanwhile, rival Sony said it will split its TV business, which is heading for its eighth consecutive annual loss, into three divisions in a bid to make its operations more accountable.

The move could include the sale of its nearly 50 per cent stake in an LCD joint venture with Samsung.

The firm is expected to fall short of forecasts when it reports its quarterly results tomorrow.

Toshiba, Japan’s biggest chipmaker, eked out a rise in quarterly operating profit on cost cuts in its PC and smartphone display businesses, and kept its earnings outlook unchanged above expectations.

Its revenues fell three per cent and core chip profits dropped by a fifth.