Sony Profits Fall 32 Percent

1-May-00

Sony Corp.'s profit fell 32 percent in the latest fiscal year as a strong yen depressed the value of the huge electronics and entertainment concern's overseas earnings. Sony said Friday its earnings fell to 121.84 billion yen, or $1.1 billion, in the fiscal year ended March 31 from 179.00 billion yen a year earlier. It was the second consecutive decline in Sony's annual group profit, and Sony expects a smaller decline this year. Sony said that during the past fiscal year, the yen was 25 percent higher against the dollar at 110.6 yen. It expects the dollar to cost 105 yen for the fiscal year that began April 1. A higher yen decreases the value of dollar-denominated earnings for Japanese exporters like Sony. On a yen-denominated basis, group sales dropped 1.7 percent to 6.687 trillion yen, or $63 billion, from 6.804 trillion yen a year earlier. Sales of electronic goods, which make up the biggest portion of Sony's revenue, rose 1.1 percent to 4.720 trillion yen, or $44.4 billion, on high demand for personal computers, digital cameras, digital videodisc players and color TVs. Electronics sales were up everywhere except for South America, Sony said. Personal computers, cellular phones and color TVs sold well in Japan, while in the United States digital cameras, DVD players and video cameras did well in addition to PCs and color TVs. On a local currency basis, Sony's movie business recorded a three percent increase in sales, partly on strong box office revenues from ""Stuart Little"" and ""Big Daddy."" But ""The Messenger: The Story Of Joan Of Arc"" and ""What Planet Are You From"" flopped. Sony unveiled a new video-game machine in March called the PlayStation2, which has sold 1.4 million machines. It is set to go on sale in US stores this fall. But the costs of introducing the PlayStation2 helped send operating profit for game products down 43.3 percent. For the current fiscal year, Sony expects group net profit to decline to 120 billion yen, or $1.1 billion, on group sales of 7 trillion yen, or $65.8 billion. Sony expects all of its business segments, excluding the music division, to post higher sales this fiscal year. Sony expects the music division to be flat compared with the last fiscal year, Senior Executive Vice President Masayoshi Morimoto said. Hit albums during the last fiscal year came from Ricky Martin, Celine Dion and Mariah Carey, Sony said.Source: Associated Press (AP)