MUMBAI: Japan's Sony Corporation has posted a first quarter net ncome of Y23.3 billion. This marks an increase of 1,975 per cent from last year's first quarter Y1.1 billion.
The company partly attributed the results to gains at Sony Ericsson Mobile Communications, which contributed Y 5.8 billion to net income, versus a similar loss last year.
Its sales and revenue increased marginally to Y1,603.8 from Y1,612.1 in the same quarter last year. However its operating income was down 41.4 per cent to Y9.8 from Y16.7.
In the Electronics segment, although sales to outside customers increased, overall sales decreased by 0.2 per cent due to a significant decline in intersegment sales to the Game segment. This was due to the outsourcing of PlayStation 2 production to third parties in China.
Sales of flat panel and LCD rear projection televisions and digital still cameras increased, while sales of portable audio and CRT televisions decreased. Sales declined in the Game segment due to lower sales of hardware. Sales increased in the music segment due to a string of successful releases. In the pictures segment, although sales on a US dollar basis increased, sales decreased due to the appreciation of the yen.
In the Electronics segment, operating income declined mainly due to the appreciation of the yen and an increase in restructuring charges. In the Game segment, an operating loss was recorded mainly due to lower sales of software published by Sony Computer Entertainment.
In the Pictures segment, operating income was recorded compared with an operating loss in the same quarter of the previous year due to the successful performance of home entertainment and theatrical releases. This included titles like 50 First Dates and Big Fish .Spider-Man 2, Hellboy and 13 Going on 30. all performed well in cinemas.
Sony chairman and CEO Nobuyuki Idei said," The consolidated results when viewed on a local currency basis demonstrated both increased revenue and increased profits. However, due to the appreciation of the yen, operating income declined and only a slight increase in sales could be realised for the first quarter ended 30 June 2004.
"Net income increased significantly mainly due to the contribution of equity in net income including that from Sony Ericsson. In addition, the worldwide theatrical release of Spider-Man 2 beginning at the end of June is proving to be a huge success."
Looking to the future he added, "For the Sony Group, the fiscal year ending 31 March 2005 has been earmarked as an important year for strengthening the foundation necessary for achieving mid- to long-term growth. We will continue to enhance the competitiveness of our products in key categories such as digital AV products, and will release enticing new products such as the new PlayStation Portable handheld video game system. In addition, by investing proactively in key components such as semiconductors and LCD panels, we are striving to increase the proportion of components developed internally in order to incorporate added-value into the Sony Group.
"In the Music segment, the establishment of a joint venture with Bertelsmann AG is aimed at improving profitability by enhancing management efficiencies and generating benefits from increased business size."
