Panasonic president sees 2011/12 as extremely tough

Reuters News
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Posted: May 20, 2011 10:48 AM
Panasonic president sees 2011/12 as extremely tough

TOKYO (Reuters) - Panasonic Corp's president said on Friday that he sees the current financial year as an extremely tough one for the electronics giant, with the effects of the devastating March earthquake and tsunami continuing to hamper sales through September.

Fumio Ohtsubo told a group of reporters at the company's Tokyo offices there were uncertainties over the effects of power shortages in the peak summer months and that additional demand resulting from rebuilding efforts in northern Japan would be small.

"On April 28, we forecast the disaster would cut first quarter sales by several hundreds of billion yen," Ohtsubo said. "At this point we see it as less, possibly half or a third of what we thought. But the second quarter will not be much better, because of the lingering difficulties with the supply chain."

He said that, although factories in north east Japan had been repaired, that did not mean they were all operating at full capacity.

Last month Panasonic said its operating profit rose 60 percent for the year ended in March, but did not give a forecast for the current year because of uncertainties following last month's devastating earthquake and tsunami in Japan.

The electronics giant also announced in April that it planned to shed at least 17,000 jobs and might close up to 70 factories around the world by March 2013, to pare costs and keep up with Asian rivals.

Ohtsubo said on Friday that the burden of job losses would be shared more or less equally domestically and overseas.

(Reporting by Isabel Reynolds; Editing by Edmund Klamann and Joseph Radford)