Report: Sony to shut Japan TV plant, cut financial forecast
- — 22 January, 2009 09:40
Sony will disclose on Thursday how a restructuring plan announced in December will hit its domestic operations in Japan, the Nikkei business daily reported Thursday morning.
Howard Stringer, CEO of the consumer electronics maker, will announce plans to close one of two domestic TV factories and cut around 2,000 jobs from its Japanese payroll, the newspaper said. Stringer will also announce a cut in managerial bonuses for 2009 and lower Sony's financial outlook for the current year, according to the report.
Sony's TV division has already been hit by the restructuring, which aims to cut 8,000 full-time workers and close five or six factories worldwide.
The Pittsburgh Technology Center, Sony's last remaining TV factory in the US, was tapped for closure in early December, and Sony also delayed plans to expand its Nitra LCD (liquid-crystal display) television factory in Slovakia.
The restructuring plan comes in response to the recession that is hitting many of Sony's biggest markets and has pushed the value of the Japanese yen to levels not seen since 1995. The strong domestic currency makes Sony's products more expensive overseas and reduces the value of profits when they are brought back to Japan.
As a result, Sony will lower its financial outlook for the current fiscal year, which runs from April 2008 to March 2009, the newspaper said.
In October Sony said it expected to report sales of ¥9 trillion (US$102.5 billion), an operating profit of ¥200 billion and a net profit of ¥150 billion, but the company is expected to revise the operating profit outlook to a loss, according to the Nikkei.
Operating income, which more closely tracks performance of the core business than the more general net income, will be a loss of more than ¥100 billion, the newspaper said. If true, it would be only the second operating loss for Sony since it debuted on the Tokyo stock market in 1958.