Natural disasters hit Sharp Corporation hard: projected $3.5 billion loss

By Patrick Avenell

The Sharp Corporation overnight projected an annual loss for its 2012 financial year of over AUD$3.5 billion (¥290,000 million). This announcement was made as part of Sharp’s Consolidated Report for the nine months to 31 December 2011.

Net sales for this period were down 18.3 per cent compared to the corresponding period in FY2011, while operating income was down 86.3 per cent. Much of this poor performance was attributed to supply issues arising from the natural disasters in Japan and Thailand, and economic uncertainty in key markets.

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During the nine months ended 31 December 2011, the Japanese economy showed signs of partial recovery with the demand for reconstruction after the Great East Japan Earthquake,” said a spokesperson. “However, overall conditions remained extremely severe, due mainly to a downturn in production associated with supply chain disruption and a parts bottleneck, caused by floods in Thailand, and an historic appreciation of the yen.

“Overseas, the economy also remained deeply uncertain. This was due mainly to the European debt problems spreading both within and beyond the region, a downturn in the US economy, and a slowdown in the growth of China and emerging countries.”

Sharp further noted that sales of AV and communication devices were down more than 25 per cent during the period, sales of LCDs were also down by a similar amount. One bright spot were sales of health and environmental equipment, which rose 9.5 per cent.

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