Saw this in today's IHT... seems to me it could be read as evidence that Japanese companies are still spiraling down, or, conversely, as evidence that they are finally getting serious about seeking profitability, even if it means cutting jobs. The small upward bump in the share price suggests that the markets may lean slightly toward the latter explanation.
Opinions?
Mitsubishi Heavy Plans to Cut 7,000 Jobs
TOKYO - Mitsubishi Heavy Industries Ltd. unveiled a four-year restructuring plan Monday, including 7,000 job cuts, and revised
downward its group earnings forecast for the year through March.
In a bid to bolster sagging profitability, the maker of heavy machinery said it planned to trim its group work force through attrition by 10 percent to 64,000 by 2004, with 5,000 jobs disappearing at the parent company.
The restructuring steps by the core company of the giant Mitsubishi group reflect its falling earnings, analysts said. It revised its group current, or pretax, loss forecast to 42 billion yen ($400 million) from an already revised forecast of a 27 billion yen loss for the year. In the year that ended this March, the company posted a profit of 53.9 billion yen.
The company attributed the results, its first expected group loss since it began disclosing consolidated earnings in 1976, to fierce global competition and weak domestic capital spending.
The stronger yen is expected to continue hurting the company.
Mitsubishi Heavy also said it suffered a parent pretax loss of 29.74 billion yen in the six months through Sept. 30, against a profit of 50.63 billion yen a year earlier. Sales fell 18 percent to 916.36 billion yen.
Mitsubishi Heavy's shares rose 14 yen to 423 on Monday.
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