* Posts record net loss of 456.7 bln yen in 2011/12
* Sees 2012/13 op profit of 180 bln yen vs 173 bln yen
* Sees sales of LCD TVs, PlayStation consoles down 11 pct
* Aims to sell 33 mln smartphones vs 22.5 mln year-ago
By Tim Kelly
TOKYO, May 10 Sony Corp predicted a
return to profit this year as it looks to halve the losses in
its TV business that pushed the Japanese consumer electronics
giant to a record loss of $5.74 billion in the year just ended.
Sony shares, valued at around $15 billion or just 3 percent
of rival Apple Inc, this week slipped to a quarter
century low, a sign of how the Walkman and PlayStation maker has
lost its innovative edge and fallen behind Apple and Samsung
Under new CEO Kazuo Hirai, Sony is slashing costs - 10,000
jobs, or 6 percent of the global workforce, will go - in a bid
to turn around its struggling TV unit. At a briefing last month,
Hirai sketched a future driven by mobile devices such as the
Xperia smartphone, gaming and cameras, as well as medical
devices and electric car batteries, along with big cost cuts in
the TV business that has lost more than $12 billion in 9 years.
The company said on Thursday it expects to sell more than 33
million smartphones this year, up from 22.5 million last year.
In preparation for that mobile push, Sony last year bought out
Ericsson from a phone joint venture to integrate the
business with its other consumer electronics units.
"In handsets, without big innovations, Sony will still be a
second-tier smartphone market player," said SR Kwon, an industry
analyst at Dongbu Securities in Seoul. "I'm just not impressed
by Sony smartphones."
"Will Sony get much better as time goes by? I'm not that
optimistic. Currency is not the only problem, the bigger problem
is that Sony has failed to catch up with consumer trends in TVs
Sony expects an operating profit of 180 billion yen in the
year to next March, slightly ahead of market estimates, but a
rebound from a loss of 67.3 billion yen in the year just ended.
It forecast a full-year net profit of 30 billion yen.
"The operating profit forecast isn't far off the level seen
two years ago ... This suggests we're on a recovery trend and
last year was definitely the bottom," said Kenichi Hirano,
operating officer at Tachibana Securities in Tokyo. "But I think
not everyone in the market is convinced of this, especially
since the company lacks a solid plan to turn around its TV
Sony's net income forecast, though, was not as high as some
had anticipated. "The net profit came in below expectations, but
they're projecting a strong operating profit, which I'm still
doubtful they can achieve," said Hiroyuki Fukunaga, chief
executive at Investrust.
"It looks like they're trying their best, but just looking
at the figures it's hard to see exactly how they're going to
Sony predicted sales of its liquid crystal TVs would fall 11
percent to 17.5 million in the current year, but forecast its
losses from the LCD TV business would halve to 80 billion yen.
As TV technology moves on, Samsung reiterated on Thursday it
plans to sell organic light emitting display (OLED) TVs from the
second half of this year and reckons this will become mainstream
TV technology within 2-3 years.
Hirai, who succeeded Welsh-born Howard Stringer last month,
hopes to reduce Sony's TV costs after exiting a joint LCD panel
venture with Samsung. The Japanese firm in December agreed to
sell its 50 percent stake in the panel production firm that had
locked it into buying expensive panels as a market glut
triggered a drop in the price of the main TV component.
Sony also sees an 11 percent decline in sales this year of
its PlayStation games console, to 16 million. Sales of its new
Vita handheld games console hit 1.8 million in the previous
year, Sony said.
Sony's January-March operating loss of 1.4 billion yen was
narrower than the average 10 billion yen loss estimated by five
Hirai has set a target for group sales of 8.5 trillion yen
($106.85 billion) in two years, with an operating margin of more
than 5 percent, but he has yet to spell out just how Sony will
achieve those mid-term targets, and investors are concerned
about Sony's prospects as consumers flock to gadgets made by
Samsung and Apple. Since the start of the year, Sony shares have
dropped 12 percent, while the benchmark Nikkei 225 index
has gained nearly 7 percent.
Hirai "seems to have the will to turn the company around,
but he's a young CEO and it's unclear whether he will actually
be able to," said Investrust's Fukunaga. "Until we see some
progress it's hard to judge whether they can meet their goals."
Ahead of the results on Thursday, Sony shares closed down
1.2 percent at 1,213 yen, while the Nikkei average slipped 0.4