April 28, 2005 – Sharp Corp. is the only one among major Japanese consumer electronics makers in fiscal 2004 to have increased sales, as well as operating and net profits, while the rest collapsed under the weight of escalating price competition, reported the Nihon Keizai Shimbun.
On Wednesday, Sharp reported a second consecutive year of record group operating profit for fiscal 2004 at 151 billion yen (US$1.42 billion), an increase of 24% on the year. The company rode out intensifying competition thanks to the expansion of product line-ups based on its main breadwinner, LCD panels. Sales of its mainstay LCD television sets rose 80%, and other proprietary products, such as LCDs with built-in ICs, helped the company increase consolidated sales by 13% to 2.53 trillion yen. Sharp’s net profit came to 76.8 billion yen, up 27%.
In contrast, Sanyo Electric Co.’s group sales, operating profit, and net profit all declined on the year in fiscal 2004. Suffering from the lack of a strong brand amid shortening product life cycles and escalating sales competition, the company’s sales dipped 1% to 2.58 trillion yen. Sanyo expected sales of its mainstay digital cameras to grow 60% to 18 million units, but actual sales remained mostly unchanged from a year earlier at 11 million units.
Add to this the 42.3 billion yen loss stemming from the major earthquake that hit the Niigata-Chuetsu area, and Sanyo sank into a net loss of 137.1 billion yen. The firm’s operating profit was at 42.3 billion yen, a decrease of 56%.
Pioneer Corp. saw its DVD recorder business plunge into the red because it was unable to cut costs fast enough to keep up with declining sales prices. It managed to increase overall sales by 5% to 733.6 billion yen, but operating profit nose-dived by 95% to 2.5 billion yen. It ended up with a net loss of 8.7 billion yen.
Electronics parts makers were also not immune to tough business conditions. NEC Corp.’s operating profit fell 28% to 131.1 billion yen, dragged down by disappointing performance of its semiconductor subsidiary. The parent’s sales were down 1% at 4.85 trillion yen, but net profit rose 65% to 67.8 billion yen.
Fujitsu Ltd.’s sales were unchanged at 4.76 trillion yen. Operating profit grew 7% to 160.1 billion yen, but net profit dropped 36% to 31.9 billion yen. The company’s flat panel business is estimated to have lost nearly 15 billion yen.