Mitsubishi Electric Swings to a Profit
On Strength in Mobile, Chip Products
Dow Jones Newswires
TOKYO -- Mitsubishi Electric Corp. on Tuesday said it swung to a net profit in its fiscal first half on brisk sales of its semiconductor products and mobile phones.
The electric-equipment maker posted group net income of 75.8 billion yen ($704 million), or 35.30 yen a share, for the six months ended Sept. 30. That compares with a loss of 3.31 billion yen, or 1.54 yen a share, a year earlier.
Mitsubishi Electric ascribed the strong results to robust demand for information-technology equipment, especially mobile phones and chip products, among consumers and corporations. Group sales rose 13% to 1.901 trillion yen.
Group profit before exceptional items soared more than fourfold to 95.18 billion yen, compared with 21.76 billion yen. The company said it will pay an interim dividend payment of four yen a share, compared with 2.50 yen a share a year earlier.
Among the company's five business segments, the electronic-device sector accounted for about 51% of total operating profit in the half, bringing in 48.5 billion yen. Strong semiconductor operations helped the sector swing from a year-earlier operating loss of 9.9 billion yen in the sector.
Setsuro Okada, senior vice president at Mitsubishi Electric, said first half-results show record highs for consolidated net income, pretax profit and sales. Mr. Okada attributed the solid earnings results to the company's groupwide effort to cut costs and better manage its finances.
"We had a hefty special profit from a pension trust in the first half, which also contributed to the record profits," Mr. Okada said. The extraordinary profit from the establishment of the pension trust raised the company's group net income by 38.8 billion yen.
Looking ahead to the year ending in March 2001, Mitsubishi Electric predicts group net income of 120 billion yen on sales of 4.2 trillion yen. The projected earnings would be another record, even excluding the 38.8 billion yen in extraordinary profit from the pension trust.
Mitsubishi Electric plans to build on its semiconductor unit and invest 150 billion yen to its semiconductor facilities, more than double from the year earlier, the company said. The company also expects to sell 27 million units of mobile-phone handsets in the current fiscal year, which would more than double from the previous year.
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The phone business looking up.
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