TOKYO: Panasonic said Wednesday its net profit soared to $1.1 billion in the three months to June, mainly due to one-off gain from a pension scheme change.
The electronics giant booked a 107.8 billion yen net profit in its fiscal first quarter, a more than seven-fold increase from the 12.8 billion yen in the same quarter a year earlier.
It also said operating profit rose 66.3 percent to 64.2 billion yen, thanks to cost cutting efforts and a weaker yen boosting the value of its overseas income. Sales inched 0.6 percent higher to 1.82 trillion yen, it said.
The company kept its full-year forecast unchanged, eyeing a net profit of 50 billion yen on sales of 7.2 trillion yen in the year to March 2014.
Panasonic, like rivals Sony and Sharp, has been undergoing a massive restructuring aimed at stemming record losses in recent years largely tied to their struggling electronics units.
Over the past fiscal year to March, Panasonic booked a 754.25 billion yen net loss, which followed on a whopping 772.17 billion yen shortfall in previous year, one of the worst-ever losses for a non-financial Japanese firm.
In its latest quarter, Panasonic said consumer products such as televisions, smartphones and digital cameras continued to see falling sales.
Revenue also took a hit after the company stopped selling many unprofitable products as it focuses on higher-margin products, something analysts have been calling on Japan's major electronics firms to do for years.
"A weak yen helps Japanese electronics makers show positive results, but in reality their core business digital electronics is not in good shape," Koki Shiraishi, analyst at SMBC Nikko Securities, told AFP before Panasonic's results were released.
"In particular, a decline in demand for smartphones is a serious problem for everyone. The entire industry has been in a severe price competition, which is pressuring their sales and profit."
Rivals Sony and Sharp are set to publish their financial results this week.
Panasonic said its balance sheet benefited from cuts to employee bonuses and various fixed costs.
The value of its domestic sales fell six percent, while overseas sales, accounting for more than a half of Panasonic's revenue, rose eight percent.
It added that there was strong demand for its vehicle-related products, such as audio and navigation systems, thanks to solid automotive production abroad.
Sales rose "due mainly to positive impact of yen depreciation and stable demand in the housing and automotive businesses", Panasonic said.
The firm's net profit boost, however, was largely thanks to a one-off gain of 79.9 billion yen from an accounting change tied its pension fund, it said.
A weaker yen generally helps Japanese exporters by making their products more competitive overseas and inflating the value of repatriated foreign income. (AFP)
