Excerpt from our Wall Street Breakfast, a one-page summary of this morning's key market-moving and stock-moving stories:
Summary: Despite announcing improved H1 results, Sanyo brought more bad news to its investors as it said a previously projected full-year profit of ¥20 billion ($172m) would instead be a loss of ¥50b ($430m) due to further restructuring costs. It cut its sales estimate by 8% to ¥2.2t ($19b). Sanyo also cited weakness in two of its four core businesses: digital cameras and mobile phones, but denied a report of a spin-off of the latter. This will be its third consecutive year in the red, with cumulative losses totaling $3.7b. After receiving a critical cash infusion of ¥300b ($2.6b) in Feb. from Goldman Sachs and two Japanese banks, its shares have tumbled 40%. The three received preferred shares convertible at ¥70/share and are seen stepping up pressure since they control a majority of board seats. Bloomberg reports Sanyo's shares have fallen 70% in the past five years, compared to a 57% gain for the Nikkei 225. Its ordinary shares dropped another 6% today to close at ¥170, a 31-year low.
Related links: Sanyo mid-term financial results. Media coverage: Bloomberg and WSJ. Commentary: Update on Sanyo's Forthcoming Delisting • Sony's Battery Production Capacity Strained, Sanyo to Benefit • Sanyo's Shareholders Approve $2.6b Cash Infusion.
Potentially impacted stocks and ETFs: Sanyo Electric Co ADR (OTC:SANYY), Goldman Sachs (NYSE:GS)
Seeking Alpha is not affiliated with Reuters.