Japanese Tech Stock Weekly Summary (Jan. 26 - Feb. 1, 2009)

The following is excerpted from IRG's weekly stock report:

• • •

Hardware

• Panasonic Corp. (PC) will cut 560 jobs in Asia due to the closure of two plants in the region, while declining to confirm a report saying the Japanese electronics giant will likely suffer its first net loss in six years. The company will shut down a factory in Malaysia and another plant in the Philippines to cope with a rapid change in the global electronics market. The closures come as Panasonic is in the middle of a US$9 billion takeover of smaller Japanese rival Sanyo Electric Co. (SANYY.PK) to become one of the world’s biggest electronics companies. Around 500 workers at the Malaysian electronics parts plant in Malacca will be out of work, while some 60 employees at the Philippines battery factory will also lose their jobs. Panasonic also runs two electronics parts plants in the central Malaysia state of Selangor. The spokesman said the company will merge them into one by September. Panasonic may incur a net loss of about 100 billion yen in the fiscal year ending March 2009. It would mark the first net loss in six years for Panasonic. Panasonic’s operating profit will be also worse than its forecast of 340 billion yen. The paper did not give any projection for the operating profit.

• Toshiba Corp (TOSBF.PK) plans to cut costs by US$3.3 billion next business year by slashing capital spending and contract jobs, as a weak chip sector and a global slowdown put the Japanese electronics group on course for its worst-ever annual loss. The company and Samsung Electronics (SSDIF.PK) are struggling in a near two-year sector downturn caused by chronic oversupply and weak demand for digital cameras and other electronic gadgets. Semiconductor makers have slashed output to revive prices, but anaemic consumer demand in a deep economic slump has capped price gains, forcing some firms to seek government support. Toshiba said it would halve capital spending in the year starting in April, by delaying construction on two new flash memory chip plants and reining in LCD ramp-ups. It will eliminate 4,500 contract posts but rehire 500 as staff in its one profit-making business, power plants and elevators. Toshiba has rejigged its operations in recent years, pooling resources to focus on its NAND flash memory chips -- used in digital music players such as Apple's (AAPL) iPod and in mobile phones. The global flash memory market shrank by a third in the last quarter from a year earlier.

• Sony Corp. (SNE) swung to a quarterly operating loss and reiterated a forecast for its first annual loss in 14 years, battered by a firmer yen and weaker demand while highlighting deepening woes at the electronics conglomerate. The loss announcement was expected as Sony cut its annual outlook last week for the third time this business year and unveiled preliminary results for October-December. Sony, which competes with Samsung Electronics Co. Ltd. in LCD TVs and with Canon Inc. (CAJ) in digital cameras, is struggling as the global financial crisis grows into a broad recession and hits consumer demand for gadgets. The Japanese maker of Bravia LCD TVs and Cyber-shot digital cameras reiterated its latest forecast of a record 260 billion yen (US$2.9 billion) operating loss for the year ending March 31. That would be a sharp reversal from a 475.3 billion yen (US$5.3 billion) profit in the previous year but in line with the consensus forecast for a 264 billion yen (US$2.9 billion) loss in a poll of 10 analysts by Reuters Estimates. As inventories pile up and prices tumble, Sony is feeling the pinch of the downturn in every part of its operations, which range from semiconductors to movies and insurance.

• Advantest Corp. (ATE) reported a 10.7 billion yen (US$118.3 million) group net loss for the nine months ended Dec. 31, tumbling from a 19.9 billion yen (US$221.2 million) profit a year earlier, due to waning demand for semiconductor testing devices. Hit by the earnings decline, the company will compile a restructuring plan by February that will include job cuts. And it is now unsure about its fiscal-year-end dividend, having retracted a planned 25 yen (US$0.3) per share payout. Sales plunged 55 percent to 67.1 billion yen (US$746 million). The semiconductor market sank further toward year's end, forcing South Korean and Taiwanese memory makers, as well as U.S. microprocessor manufacturer Intel Corp. (INTC), to slash or delay capital investments. Advantest received 8.9 billion yen in orders for the October-December quarter, a 71 percent plunge on the year and 51 percent less than the July-September period. The company suffered an operating loss of 15.5 billion yen (US$172.3 million) for the April-December period, falling from a 25.5 billion yen (US$283.5 million) operating profit a year earlier. The loss was particularly severe in the three months ended Dec. 31, hitting 11.6 billion yen (US$129 million).

• Canon Inc. said its net profit fell by over a third last year, as the stronger yen ate into its overseas profits and sales were lower for almost all of its products. The company said it had a dismal fourth quarter and expects this year to be even worse than 2008, forecasting a 70 percent plunge in profit. Net profit for 2008 fell to 309.15 billion yen (US$3.47 billion), a 37 percent drop from the 488.3 billion yen (US$5.4 billion) it made last year. Revenues fell nine percent to 4.09 trillion yen (US$411 billion). Over the last three months of the year, net profit was less than one tenth of what it was a year earlier, at 11.6 billion yen versus 127.8 billion yen (US$1.4 billion). For 2009, the company said it expects profit to drop to 98 billion yen (US$1.1 billion) as revenues slide to 3.5 trillion yen (US$39 billion). Like its peers at home and abroad, Canon's sales have plunged as the consumers and companies that buy its products cut back on spending. It reported lower sales of major products including business copiers and computer printers.

• NEC Tokin Corp. (NELTY.PK) announced a massive restructuring plan that includes halving its domestic and overseas full-time work force of 19,000 workers and factory shutdowns. The NEC Corp. unit, which produces such products as batteries and electronic components, seeks to expedite costcutting measures due to a sharp decline in parts demand from consumer electronics manufacturers and automakers, which have seen a marked drop in sales. NEC Tokin plans to slash about 9,000 fulltime positions overseas at such locations as its Chinese, Vietnamese and Thai factories, as well as at local sales bases. In Japan, it will trim around 450 jobs through late March by soliciting early retirement from among its 2,800 domestic full-time workers. Of NEC Tokin's seven domestic plants, the Tochigi manufacturing facility and two other locations will be subject to closure this year. The company will withdraw from some unprofitable segments, such as lithium ion batteries used in mobile devices. NEC Tokin saw a group net loss of 18.6 billion yen US$208.54 million) for the April-December 2008 period due to impairment charges for some restructuring measures. And as of December 31, the company fell into a negative net worth of 10.6 billion yen (US$118 million).

• Sharp Corp. (SHCAY.PK) said it had been ruled against in a U.S. LCD patent row in which South Korea's Samsung Electronics Co. sought to stop it importing some related products to the United States. The decision by an administrative law judge at the U.S. International Trade Commission was still preliminary and that it would not stop Sharp from import and sales activities there. The company, the world's third-largest LCD TV maker behind Samsung and Sony Corp , planned to appeal, and that a final decision by the commission would likely come in late April. The commission is also looking into Sharp's complaint over alleged LCD patent infringements by Samsung, but a decision on that case has yet to be made. Sharp sold 4.8 million LCD TVs outside Japan in the year ending in March 2008, and the United States accounted for about half of those overseas sales.

Semiconductor

• Toshiba Corp. announced that it has signed a definitive agreement with SanDisk Corp. (SNDK), under which Toshiba will acquire part of the 300mm wafer lines currently owned and operated by Flash Partners, Ltd. and Flash Alliance, Ltd. The agreement was reached following a non-binding memorandum of understanding on reallocation of wafer capacity and equipment ownership at the two JVs that Toshiba and SanDisk signed. Under the definitive agreement, Toshiba will acquire part of the manufacturing equipment currently owned or leased by the joint ventures and used in Fab3 and Fab4 for a total sum of about 160 billion yen (US$1.8 billion). Toshiba plans to acquire the equipment in a series of purchases, and expects to complete the entire transaction by the end of March 2009. The transaction allows Toshiba to increase its production capacity on 300mm wafer lines in Fab3 and Fab 4. By securing already operating production equipment and lines, the company is expanding production capacity under more reasonable terms and conditions than required to install new facilities with new equipment.

Comments

[Honest Corr...:]

..." • Toshiba Corp (TOSBF.PK) plans to cut costs by US$3.3 billion next business year by slashing capital spending and contract jobs, as a weak chip sector and a global slowdown put the Japanese electronics group on course for its worst-ever annual loss" ... !!!

The God sees the Evil even under the perfect cover !

NEC, Toshiba, Fujitsu, Panasonic and Mitsubishi should better "destruct" or "report" their so called 'hidden network' in Singapore - Finland [Kouvola warehouses] - Russian Retail chains (especially may be mentioned two international retailer's chains: MediaMarkt Saturn and Auchan).

It is not a very dark secret for the progressive mankind that Toshiba's and Mitsubishi’s Headquarters are receiving revenge strikes from Russian Electronics Mafia...:

If you open Moscow Yellow Pages, you would be surprised how many foreign companies have their offices in Moscow...

Although the international financial crisis has caused the collapse which has never occurred since the Great Depression, the Russian Federation is still considered as a quiet harbor.

Amongst the transcontinental companies there are a considerable number of Japanese corporations such as Toshiba, Mitsubishi, Fujitsu, NEC, Sanyo, etc.

Though the latter are thought to be well-known for their successful in retailing of high-quality products worldwide, there have been cases which must be interesting to investigating institutions.

We are going to take Mr. Vadim Danilov’s employee fraud case including asset misappropriation, money laundering, and kickback scheme.

The story goes Mr. Vadim Danilov was hired by Mr. Harry Fujimaki to work for Toshiba Corporation (Kabushiki-gaisha Toshiba) as a general logistics manager in Russia.

The event occurred in 2004.

In the course of two years Mr. Danilov had been “employed” in other areas such as, a certification specialist, customs broker, trader, promoter, etc. Mr. Danilov worked effectively and honestly thinking that he was a team player contributing to Toshiba’s profits.

Moreover, Mr. Koichiro Natsume, an executive manager of Toshiba Corporation in the CIS, declared him a Toshiba Official Trader at the Conference at the Imperial Park Hotel, Moscow, 2006.

In addition, Mr. Natsume declared that Mr. Vadim Danilov was officially registered by Toshiba Corporation as Toshiba's Official Trader named “the Ninth Wave” in the UK.

To conclude the announced procedures, Mr. Natsume issued to Danilov’s Ninth Wave an invoice which was paid to a TCMS official account at Sumitomo Mitsui Banking Corporation, Singapore Branch.

Furthermore, there were other financial transactions during 2006-2007-2008 years, executed by Mr. Vadim Danilov between clients and Toshiba Consumer Marketing Singapore, SMBC Singapore branch account.

After all the payments were completed, Mr. Natsume vanished somewhere in Japan. Toshiba Corporation managers in Russia, Japan and Singapore refused to explain to Mr. Vadim Danilov how those payments had been used.

Toshiba Corporation & TCMS, Mitsubishi and MCLogi, insist nowadays that Mr. Vadim Danilov has no evidences and the corporations declare now that Mr. Vadim Danilov had never had any relations with Toshiba Group Companies or Mitsubishi's MCLogi stuff.

Moreover: the Toshiba and Mitsubishi MCLogi staff has been running away from Mr. Danilov for 35 months (!).
The Metropolitan Police Department of Tokyo also refused to investigate the accident and explained to Mr. Danilov that he had no right to bring in an action against a Japanese citizen.
It would be better for the Metropolitan Police Department of Tokyo to check diligently backgrounds of Toshiba's and Mitsubishi's Conformity Certification procedures manipulations in Russian Federation. As well as Customs Clearance documents with false Japanese stamps and signatures of imaginary "Japanese Customs" or "Thailand Customs"...

It seems to be a confrontation between David and Goliath but David had had no backup…

It seems The Heaven's Referee is judging nowadays all the involved sides by crisis processings ...

Feb 04 08:34 AM