Sharp has revised its outlook for the fiscal year to March, now forecasting its third loss in four years. The recent fluctuations in global exchange rates, price declines in LCDs and difficult economic conditions in some markets led the company to forecast a net loss of JPY 30 billion for the year, versus a previous outlook for a profit of JPY 30 billion and a profit in the previous year of JPY 11.6 billion. The sales forecast was maintained at JPY 2.9 trillion, while the operating profit outlook was halved to JPY 50 billion.
In the fiscal third quarter to December, sales fell 6.4 percent to JPY 763 billion, and operating profit more than halved to JPY 22 billion from JPY 47.6 billion a year earlier. The company posted a net loss of JPY 11.9 billion versus a profit of JPY 22.0 billion a year ago. Sharp saw LCD price pressure due to increased competition in the TV market, the changing product mix in mobile displays in China and the slowing tablet market. In addition, Sharp booked an allowance for increased tax due to transfer pricing rules in China. It also recorded JPY 8.9 billion in restructuring charges and gains of JPY 5.7 billion on the sale of securities.
An increase in inventories led to a drop in its cash balance of JPY 37.6 billion in the three months to JPY 253.8 billion at the end of December. Net debt rose over the same period to JPY 743.3 billion from JPY 696.6 billion in September.
