NEC Corp has reported a consolidated net interim loss for the six months to September 30 of 48.8bn yen ($460m) which it attributes to lower semiconductor prices, a higher yen and restructuring costs. In the first half of the 1998 financial year NEC reported a loss of 19.7bn yen ($186m). However, despite the size of the loss, sales climbed 7.3% to 2.26 trillion yen ($21.3bn) in the first half. And the company is still predicting a net profit for the year of 10bn yen ($94m) on sales of five trillion yen ($47.2bn).
Managing director Shigeo Matsumoto said this would partially be achieved by the sale of land and shares, but also because the international microchip market is expected to pick up in the six months to March 31 bringing NEC’s semiconductor business back into the black. We suffered a huge loss in the semiconductor operation but we project a profit of some 20bn yen for the whole financial year, Matsumoto said.
The ongoing restructuring will include closing down loss-making NEC Home Electronics which has built up losses of 60bn yen despite frequent cash injections from the parent, and incorporating the defense businesses of three companies into one new firm. A company statement said the yen averaged 118.18 to the US dollar in the first half of the current financial year compared to 137.47 a year earlier.
