Sony woes continue

Posted on 30 Jul 2009 by The Manufacturer

Japanese electrical manufacturing giant Sony has announced a loss of £237m ($390m, 37.1bn yen) for the April to June quarter.

This constitutes a sharp swing from the 35bn yen profit it made in the same period in 2008.

The group is suffering in almost all of its departments, with sales down 19 per cent on last year. Demand for televisions, cameras, gaming consoles and other electrical gadgets have been especially weak since the start of the downturn and Sony is losing market share against competitors like Samsung and Panasonic. It is also struggling against the high value of the yen, a development unfavourable for exports from the country. The Japanese currency is up 7.5 per cent on what it was a year ago and is up 23.5 per cent against the Euro.

Sony expects group sales to be down six per cent and make a net loss of 120bn yen in the 2009/10 financial year.

Japanese output as a whole actually rose by 8.3 per cent in the April to June period, but this was still significantly lower than in the same timeframe last year. Consumer demand remains weak in the country and the Japanese economy is expected to shrink by 3.4 per cent in the 2009/10 financial year.

Sony is implementing a raft of cost-cutting measures including plans to make 16,000 people – 10 per cent of its global workforce – redundant and cuts its supplier network in half, from around 2,500 to 1,200.