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August 4, 2009

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Panasonic loses US$558m on sliding sales and lower prices

PANASONIC Corp posted a 52.98 billion yen (US$558 million) loss as sliding sales, falling gadget prices and restructuring costs kept the Japanese electronics maker in the red for a third straight quarter.

The Osaka-based maker of Viera TVs and Lumix digital cameras yesterday kept its forecast unchanged for a 195 billion yen loss for the full fiscal year through March 2010.

Analysts surveyed by Thomson Reuters had forecast a slightly worse 58.25 billion yen loss for the fiscal first quarter, and project a 184.97 billion yen loss for the full year.

Panasonic said it was struggling to adapt as the focus for business growth shifts to emerging markets, such as India and China, amid a slump in the mature markets of the United States, Japan and Europe.

Demand was also shifting toward cheaper consumer electronics goods, it said in a statement.

Panasonic, like many other Japanese electronics makers, has been battered by the global economic slump and competition from rivals like Acer Inc who are more adept at churning out lower-end products.

Last week, arch-rival Sony Corp said it sank into a 37.1 billion yen loss for April-June, and stuck to a forecast for a big full year loss, as quarterly sales slipped 19.2 percent on year.

Panasonic's quarterly sales dropped 26 percent from a year earlier to 1.596 trillion yen. Overseas sales plunged 33 percent, while sales in Japan declined 18 percent.

Panasonic said sales fell in every major product category, including video and TV products, personal computers, devices, housing, and home appliances such as air conditioners.

The company spent 21.6 billion yen in expenses for early retirement programs, as part of restructuring efforts, in the last quarter, and that also hurt results, it said.

It now employs 288,933 workers around the world, down about 7 percent from 310,581 a year ago.

The electronics manufacturer said the worst of the global recession may be over and economies were stabilizing, but too many uncertainties remained.


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