Osaka, Japan — Matsushita Electric Industrial Co., Ltd., best known for its Panasonic brands, reported group sales for the fiscal year ending March 31 increased two per cent, the equivalent of U.S.$77.19 billion, from the same period a year ago. However, it chalked up an operating profit up 11 per cent, or about U.S. $3.9 billion.
The company cited sales gains in digital products, including plasma TVs and high-end digital still cameras. Of the consolidated group total, sales in Japan amounted to 4,616.5 billion yen ($39.12 billion), mostly unchanged from 4,611.4 billion yen a year ago. Overseas sales increased 5% to 4,491.7 billion yen ($38.07 billion), from 4,282.9 billion yen in fiscal 2006, ended March 31, 2006.
The company said that during the year under review, the electronics industry faced what it called severe business conditions in Japan and overseas, due mainly to rising prices for crude oil and other raw materials and continued price declines caused by global competition, mainly in digital products. However, it implemented growth strategies and strengthened management structures to achieve fiscal targets.
As part of the effort, it says it aggressively launched and promoted a new series of V-products to capture leading market shares and make a significant contribution to overall business results. Aiming to reinforce its management structures, the company has made all-out efforts to reduce raw materials costs and eliminate redundancies throughout the Matsushita Group.
Regarding earnings, operating profit for this fiscal year was up 11 per cent, to 459.5 billion yen ($3.89 billion), from 414.3 billion yen in the previous year, due primarily to the cost reduction efforts including materials costs and fixed costs, and a weaker yen.
The company makes everything from electric motors to healthcare sytems. Briefly, sales of video and audio equipment increased six per cent from the previous year, due mainly to strong sales in digital AV products such as flat-panel TVs and digital cameras. Sales of information and communications equipment decreased two per cent. Sales of mobile phones were described by the company as sluggish. Sales of components and devices were up four per cent.
For the coming year the company said it expects to encounter severe conditions, such as continuing price declines and rising crude oil and other raw materials prices, as well as concerns about the global economic conditions, mainly in the United States. It expects fiscal 2008 sales on a consolidated basis to again increase two per cent, while consolidated operating profit is forecasted to increase by about nine per cent.