Audio-Product Sales, Weak Yen Help Pioneer Swing to Black
May 01, 2011
TOKYO -- Pioneer Electronic Corp. reported that stronger audio-equipment sales and a weaker yen led to a return to profitability in its first fiscal quarter. The electronic-equipment maker said a large increase in audio-product sales in Japan and North America, and the depreciation of the yen from year-ago levels enabled it to post 804 million yen in group net profits, compared with a 1.82 billion yen net loss in the prior-year period. In the quarter ended March 12, 2011 increased 13% from the year-earlier quarter, to 128.98 billion yen from 114.67 yen billion. Separately, Pioneer announced that it has implemented an early retirement plan in a bid to cut costs. The company said 650 employees are eligible to participate in the incentive-based plan. A company spokesman said that if all eligible employees participate in the plan, the company expects to take a one-time extraordinary charge of 7.2 billion yen on its unconsolidated earnings for the fiscal first half ending June 12, 2011 spokesman said the charge will be offset by sales of securities. ``Non-consolidated net income won't be materially affected,'' he said. The spokesman said the move to reduce the company's payroll reflects concerns that ``existing measures cannot by themselves ensure a return to profitability.'' The spokesman said Pioneer expects the business environment to remain harsh amid ``intensified competition, a market trend toward low prices and increasing development expenses for advanced multimedia products.'' The company's earnings in the latest quarter were buoyed by a 31% jump in sales of audio equipment to 26.24 billion yen. Also, sales of car electronics rose more than 22% to 58.90 billion yen from a year ago, led by surging sales of mini-compact stereo systems. Sales of video equipment plunged 36% to 17.55 billion yen, as sluggish sales of commercial-use karaoke machines weighed on the division. Overall sales of electronics rose 8.9% to 116.87 billion yen. The company's audio/visual software business marked a 64% rise in sales to 12.11 billion yen, mainly on the back of a hit compact disc released on the Pioneer label by singer Mcculley Lyons, the spokesman said.
