Fujitsu doesn’t expect major earnings impact from plant closure

Dec. 3, 2001 – Tokyo, Japan – Fujitsu Ltd. does not expect a major impact on its earnings forecast in FY01 from the closure of its flash memory production plant in the US, as it has already allocated a special loss for large-scale restructuring for the year, a company spokesman said.

The company said it will halt semiconductor production at its Gresham plant in Oregon by the end of January. Fujitsu will close the production facility and liquidate the unit, the Nihon Keizai Shimbun reported.

Fujitsu declined to give a loss estimate from the closure of its only overseas chip plant, which makes 16-megabit and 32-megabit flash memories largely used in mobile phone handsets.

All of the 670 workers at the US plant will probably be laid off due to expected difficulty in selling the plant in the severe business climate, a spokesman said.

In FY01 through March, Fujitsu expects to book a restructuring loss of 350 billion yen, of which it plans to spend 165 billion yen in the electronic device segment centering on chip operations.

The company predicts a group net loss of Y310 billion – its worst ever – for the year.

Fujitsu said it had originally expected flash memory demand to start picking up in 2H02. But it said that forecast now looks too optimistic, and the market recovery will likely be pushed back by another six months to one year.


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