Panasonic rebounds to Q3 profit, keeps forecast

Panasonic rebounds to Q3 profit, keeps forecast

Panasonic said Friday it lost about $6.77 billion in the nine months to December and was on track to lose a whopping $8.3 billion over its fiscal year.

The struggling electronics giant's nine-month net loss of 623.83 billion yen ($6.77 billion) nearly doubled its year-earlier shortfall, while sales slipped 8.8 percent to 5.44 trillion yen, owing to weak flat-panel television sales.

However, the company said it posted an operating profit of 121.95 billion yen in the same period, adding that the positive result was due "mainly to fixed cost reductions and streamlining material costs".

Panasonic, like rivals Sony and Sharp has seen sales slump on the back of the global slowdown while it also took on huge restructuring costs, which contributed heavily to its bleeding bottom line.

Also Friday Sharp reported that its net loss in the April-December period had doubled to $4.6 billion.

In November ratings agency Fitch downgraded Panasonic and Sony to junk status for the first time.

The agency slapped a speculative rating on each firm, pointing to their weak balance sheets and declining position in the global electronics sector. The downgrades mean their debt was no longer considered a safe investment.

Japan's electronics sector has suffered from myriad problems including a high yen, slowing demand in key export markets, fierce overseas competition and strategic mistakes that left their finances in ruins.

In one bright spot, Sony has said it expects to reverse four years of losses with a small net profit in the year to March. The company reports its earnings next week.

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