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Sony Corp. (6758) and Sharp Corp. (6753), Japan’s biggest makers of liquid-crystal-display televisions, fell in Tokyo trading after announcing record losses amid declining global TV shipments and the strong yen.
Sony dropped 5.9 percent, the most on an intraday basis since Nov. 4, to 1,492 yen as of 9:07 a.m. The company had a loss of 520 billion yen ($6.4 billion) for the year ended March 31, it said yesterday after the close of trading in Tokyo. Sharp slid 2.8 percent to 515 yen after reporting a 380 billion yen full-year loss.
The two companies were hammered by rivals Apple Inc. (AAPL) and Samsung Electronics Co. (005930) and natural disasters that disrupted their output in Japan and Thailand, while Japan’s currency reached a postwar high, prompting government intervention. Sony’s new president, Kazuo Hirai, may have to raise equity and cut jobs while Sharp has turned to Taiwan’s Foxconn Technology Group (FOXCGZ) for a $1.6 billion infusion.
“Investors have kept hoping for their revival and have been repeatedly let down,” Einosuke Yoshino, a fund manager at Commons Asset Management in Tokyo, said today by phone. “They make slow decisions and have weak leadership. I no longer believe them.”
Sony took a 300 billion-yen charge to write down the value of deferred tax assets as the company no longer expects to be as profitable as it had once forecast. The company may raise financing with equity, Chief Financial Officer Masaru Kato said yesterday in Tokyo. Sony hasn’t made any specific plans to do so, he said.
“Sony had said they weren’t likely to book further tax- asset charges a year ago, when they took a similar charge,” Masahiko Ishino, an analyst at Mitsubishi UFJ Morgan Stanley Securities, wrote in a report yesterday. Ishino lowered his share-price estimate on Sony to 1,450 yen from 1,500 yen while reiterating his neutral rating on the stock.
Sony’s loss is the worst since the company was founded, according to Mami Imada, a spokeswoman. Including the announcement of the 520 billion-yen loss, Sony lost a combined 919.32 billion yen in the past four years, according to data compiled by Bloomberg.
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