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(No.1 High-Tech News Site in Japanese)

  • NEC Estimates 20B-Yen Consolidated Loss for First Half FY98
  • September 23, 1998 (TOKYO) -- NEC Corp., Japan's largest semiconductor maker, on Sept. 18 revised downward its business projections for the first half of fiscal 1998 ending on Sept. 30, 1998 to a consolidated loss of 20 billion yen (US$150 million).
    It also revised down its projections for the whole of FY98 (April 1998-March 1999). The revisions were due partly to sluggish sales of semiconductors.

    NEC said that Japan's slow business recovery, decreases in domestic communications carriers' demand for investment in plant and equipment, as well as stagnant semiconductor markets worldwide trimmed consolidated net sales in the first half of this fiscal year to 2.2 trillion yen (US$16.5 billion), down 7 percent from the same period last year.

    Projections for unconsolidated sales in the first half of FY98 have been revised to 1.75 trillion yen (US$13.1 billion), down 80 billion yen from the initial target and down by 11 percent compared with the same period a year ago.

    NEC expects a consolidated loss of 20 billion yen in the first half of FY98. Its unconsolidated recurring profit is likely to register a sharp plunge of 74 percent (down 12 billion yen from the initial plan), but will still be in the black to the tune of 13 billion yen.

    As of May 1998, the operating profit of the electronic devices division, which also handles semiconductors (the primary cause of the company's sluggish business performance), was expected to be 20 billion yen in the black in the first half and 80 billion yen for all of the current business year. But the latest announcement said that the company will suffer a 20-billion-yen loss instead.

    The company said it plans to make every effort to improve its profit picture in the second half so it can move into the black for the full year.

    In May 1998, NEC planned to produce semiconductors worth 580 billion yen (US$4.35 billion) in the first half and 1,230 billion yen (US$9.22 billion) for the whole year. But the company has revised the figure for the first half to 530 billion yen. It hopes to attain 1,150 billion yen (US$8.62 billion) for the entire year, on par with the last business year.

    The latest downward revisions account for 50 billion yen for the first half and 80 billion yen for the entire year.

    More information in English is at: http://www.nec.co.jp/english/today/newsrel/9809/1801.html

    (Nikkei Microdevices & AsiaBizTech Tokyo)

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    Updated: Tue Sep 22 18:24:13 1998 PDT