Panasonic Corp., Japan’s second-biggest TV maker, plunged by the daily limit in Tokyo trading after forecasting a loss 30 times bigger than analyst estimates because of restructuring costs and falling demand.
The maker of consumer electronics, solar panels and home appliances dropped 19 percent to 414 yen as of 9:33 a.m., headed for the lowest close since February 1975. Sony Corp., set to report earnings today, fell 4.6 percent in Tokyo.
Panasonic’s net loss may be 765 billion yen ($9.6 billion) in the year ending March 31, the Osaka-based company said in a statement yesterday, scrapping its May projection of 50 billion yen in net income. The forecast for the second-highest loss in its history prompted Panasonic to say it won’t pay a dividend for the first time since 1950 because of an “urgent need” to improve its financial position.
“There’s no sign declines in sales of audiovisual and communication products such as TVs and smartphones will stop,” Shiro Mikoshiba, an analyst at Nomura Holdings Inc., said in a report dated yesterday. “Whether the company’s transformation can be carried out with a soft landing is becoming more uncertain.”
Mikoshiba lowered his rating for the stock to neutral from buy and cut his price estimate by 33 percent to 500 yen.
The bulk of Panasonic’s projected loss will come from 440 billion yen of restructuring expenses, which includes writedowns of goodwill on solar cells, lithium-ion batteries and mobile-phone operations, the company said yesterday. Panasonic is also taking 412.5 billion yen in charges to write down deferred tax assets, the company said.
The maker of Viera televisions cut its TV sales target for the year to 13 million units from 15.5 million and said it will stop selling mobile phones overseas.
Panasonic has “a severe outlook for the second half,” Chief Financial Officer Hideaki Kawai said yesterday, citing worse-than expected demands for TV, cameras, Blu-ray disc players and PCs.
The extra yield investors demand to own Panasonic’s 150 billion yen of 1.081 percent notes due 2018 rather than government debt jumped 19.4 basis points to a record 106.5 basis points yesterday, according to data from JS Price.
Sony dropped as much as 5 percent, headed for the biggest decline since Aug. 3. The Tokyo-based TV maker is scheduled to report second-quarter earnings at 3 p.m. and has forecast full-year profit of 20 billion yen, compared with the 5 billion-yen average of 17 analyst estimates compiled by Bloomberg.
Sharp Corp., scheduled to announce results at the same time, fell as much as 3.5 percent. Japan’s biggest maker of liquid-crystal displays may widen its full-year loss forecast to 450 billion yen from 250 billion yen, state broadcaster NHK reported today, citing an unnamed person.
Heihachiro Ochiai, a spokesman for the Osaka-based company, said Sharp wasn’t the source of the NHK report.
Panasonic’s Kawai said the company may sell real-estate assets to generate cash and that the company doesn’t have a plan to cut jobs in significant numbers.