NEC returns to profit on cost cuts, sales recovery
Japan’s NEC Corp. returned to quarterly and annual profit, buoyed by cost cuts and recovering sales in overseas markets.
The Tokyo-based electronics maker said Wednesday it posted net profit of 64.4 billion yen ($695 million) in the January-March period, bouncing back from a loss of 168 billion yen a year earlier. The profit was the first in a year and half for NEC.
For the entire fiscal year ended March, NEC posted a net profit of 11.4 billion yen ($123 million), up from a 296.6 billion yen loss a year earlier.
The better results came even as annual revenue decreased 15 percent to 3.58 trillion yen ($8.7 billion) from 4.22 trillion yen.
NEC said sales recovery in IT services and network systems, as well as companywide cost cuts and clearing of inventories contributed to the improved performance.
The company is seeking to advance in environment-friendly and energy related products such as lithium-ion batteries and cloud-based computing. NEC last month launched a new company focusing on lithium-ion batteries.
The company projected its net profit at 15 billion yen ($160 million) for the year through March 2011 on sales of 3.3 trillion yen ($35.7 billion), down 7.9 percent.
NEC shares closed down 0.4 percent at 284 yen in Tokyo.
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