Sharp replaces management as losses grow

Sharp has announced a change in its top management, after reporting a second year of major losses. The net loss at the Japanese electronic company swelled to JPY 545.3 billion in the year to March, from JPY 376.1 billion a year earlier. This included almost JPY 100 billion in one-time charges, to write down the value of its LCD and TV businesses, restructure its solar cell activities and take a provision for a civil lawsuit over the management of its LCD business. 

Sharp said its president Takashi Okuda will step down at the AGM in June and become non-executive chairman. He will be replaced by Kozo Takahashi, a 33-year veteran of the company who will also remain chief officer of the products business group. 

Sharp posted a 0.9 percent increase in revenues for the past year to JPY 2.48 trillion, but the operating loss widened to JPY 146.3 billion from JPY 37.6 billion. Operating cash flow was a negative JPY 81 billion, and the company finished the year with cash and equivalents of JPY 187.9 billion. It will not pay a dividend for the year.

For the current year to March 2014, Sharp forecast an improvement in sales to JPY 2.70 trillion, an operating profit of JPY 80 billion and a net profit of JPY 5 billion. The company said it will make an "all-out" effort to turn around the bottom line this year, as part of its three-year recovery plan. 

The plan includes focusing on more promising markets, working more with partners on development, and stronger execution through improved governance. In addition to the ongoing cost reductions and restructuring of the product portfolio, it will focus more on expansion abroad, especially in the Asean region. The company is also in talks with its bank lenders to extend its syndicated loans and said it aims to meet the redemption terms of its convertible bonds. The overall aim of the plan is to grow by fiscal 2015 to revenues of JPY 3 trillion, operating profit of JPY 150 billion and a net profit of JPY 80 billion.