Oki Electric Industry Co predicts a consolidated net loss of 7-8 billion yen ($53m – $60.6m) in the current fiscal year through March, according to the Nihon Keizai Shimbun. That projection compares with 3.2 billion yen ($24.2m) in net income the previous fiscal year, and would be the company’s first loss in four years. Oki is blaming increased losses in the semiconductor division and weak earnings in the telecommunications division for the poor showing. Group sales are expected to grow 4% to some 760 billion yen in fiscal 1997, thanks to 7% growth in the electronic device division, including semiconductors. However, profitability in the sector is declining, as prices of 16 megabit DRAM chips have plunged about 40% since October. The company’s telecom division forecasts a nearly 20% decline in sales, due to reduced investment by main customers such as Nippon Telegraph and Telephone Corp. Earnings at Oki Electric’s chip making subsidiaries are also worsening, while sales subsidiaries in Europe and the US continue to lose money.
