Japanese electronics giant Panasonic has posted its second biggest-ever annual loss, of 420bn yen (£3.4bn), as it struggled with the impact of a soaring yen and falling demand in developed markets.
The loss came despite Panasonic speeding up its efforts to restructure its unprofitable businesses and restructuring its flatscreen TV division to improve its performance.
"What we need to tackle is the television and related semiconductor businesses," chief financial officer Makoto Uenoyama told reporters.
"If we downsize these, our profits will be completely different," he added, calling the forecast losses "the birth pangs of switching to a new strategy." Panasonic is trying to switch emphasis from consumer technology to energy and environmental technology, such as rechargeable batteries.
Panasonic cut its full-year operating profit forecast to 130bn yen from 270bn yen. It also slashed its estimate for annual TV sales to 19m sets from 25m.
It expects to book a 514bn yen cost of restructuring for the year to March 2012, as it reduces its workforce to 350,000 in 2012, a year ahead of schedule.
Half of the charge comes from restructuring the TV division but the total is far higher than previous estimates of 110bn yen.
It will cut 17,000 jobs to reach the target, though some of these are from overlapping businesses it acquired in its buyout of Sanyo, a subsidiary.
Panasonic said it will stop liquid-crystal panel production at its Mobara plant near Tokyo and is canceling its plans to ship plasma-panel manufacturing equipment from another mothballed plant to Shanghai to start production there, as it aims to turn a profit on TVs in its next fiscal year.
Panasonic's annual loss, its biggest in a decade, compares with the company's previous forecast for a net profit of 30bn yen in the year to March 2012 and last year's net profit of 74bn yen.