Sony reports first profit decline in 14 years

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Sony reports first profit decline in 14 years

Sony has joined the growing number of Japanese electronics companies to report large-scale losses, as consumers withhold from buying the latest devices and make do with what they have.

Sony reported losses of ¥98.9bn (AU$1.37 billion) in the 12 months to 31 March 2009, the first decline in 14 years and a stark contrast to the ¥368.3bn (AU$5 billion) profit generated in fiscal 2007.

The results follow Hitatchi's net loss of ¥787.3bn (AU$10.8 billion) reported on Tuesday, the largest annual loss ever by a Japanese manufacturer, and Toshiba's loss of ¥343.6bn (AU$4.6 billion), the first decline in profit for the company in seven years.

Sony warned that it did not expect its financial circumstances to get much better in the year to come, and predicted that revenue will decline by a further six per cent by March 2010. Revenue for the year just ended totalled ¥7,730 (AU$106 billion), a fall of nearly 13 per cent since 2007.

The company is to shut another three factories in an attempt to save costs, which will take the total closures to eight by March 2010. The plants due to be shut down manufacture phone cameras, video recorder parts and smartcard systems.

Sony said that restructuring charges for the year were ¥75.4bn (AU$1 billion) and that its 16,000 staff layoffs were underway.

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