German chipmaker Infineon Technologies AG said Thursday its fourth quarter net income rose sharply from a large loss a year ago as the company saw cost reductions help its results.
Infineon, based in Neubiberg, said net profit totaled euro14 million ($21 million) in the fourth quarter, compared with a loss of euro884 million in the fourth quarter of 2008.
Revenue declined 18 percent to euro855 million from euro1.05 billion in the fourth quarter a year ago. Compared to the third quarter, however, revenue increased 12 percent.
The company's fiscal year begins in October.
For the full year, Infineon still had to report a loss, although it was able to reduce it considerably. The company experienced a steep decline in demand for its products as a result of the economic downturn, and also saw restructuring effects as a result, including job reductions.
For the full fiscal year, ended September 30, the company reported a net loss of euro671 million compared to a net loss of nearly euro4 billion in the 2008 fiscal year.
Revenue in the 2009 fiscal year declined to euro3.03 billion from nearly euro4 billion in 2008.
"The strong impact of our cost reduction measures during the 2009 fiscal year have stabilized our balance sheet and helped to increase our financial freedom and flexibility," said Peter Bauer, the company's chief executive in the report.
"It will remain our goal to increase revenues and profitability on a sustainable basis and thus generate value for shareholders and other stakeholders alike," Bauer said.
Infineon said for the first quarter of the 2010 fiscal year, it expects group revenue to be on the same level as in the fourth quarter. It said revenue in the chip card and security division to see some seasonal slowdown, while the wireless solutions division, which makes products for wireless telephones, would be negatively affected by the weaker U.S. dollar.
For the full fiscal year 2010, the company expects sales growth of 10 percent, assuming the world economy stabilizes or grows and the exchange rate of the euro versus the U.S. dollar remains around $1.50. Infineon said the increase is expected to be driven especially by the automotive parts division. Infineon also makes electronic control units for automobiles.
Shares of Infineon closed nearly 1 percent higher at euro3.51 in Frankfurt trading Wednesday.
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