Mobile communications and goodwill impairments again hit Japanese electronics and entertainment group Sony, dragging the company back into loss for the first half of the year — after it reported surprise profits in the first quarter.
Sales in the second quarter of the year grew by 7% to $17.4 billion. Net losses for the July to September period were reported as $1.25 billion. Net losses for the six months from April to end Sept. amounted to $1 billion (JPY109 billion).
The ‘Pictures’ division, which encompasses much of the entertainment production and distribution activities saw sales grow by 2% in Japanese Yen in the quarter, but slip by 3% to $1.67 billion in US dollar terms. Quarterly losses at the Pictures division were reduced in comparison with the same quarter last year and stood at $10 million. That put first half profits for the Pictures division at $62 million.
Theatrical revenues were down in comparison with the same quarter last year, when more movies were released. But strong performances in home entertainment were achieved by “The Amazing Spider-Man 2,” and “Heaven is for Real.” TV licensing of “The Amazing Spider-Man” and “Men In Black 3” were also strong.
The group reduced its full year forecast of the Pictures division’s revenues and operating profit. It is now forecasting revenues of JPY860 billion ($7.89 billion) and operating income of $530 million.
Having been obliged to issue new guidance in September, reflecting the problems in its mobile division, Sony left unchanged its forward guidance for the group’s full year at a net loss of JPY230 billion or $2.11.
Prior to the results announcement Sony shares were trading up by 1.6% in Tokyo at JPY2087.5. That was a significant lag compared with the Nikkei-225 index which was up by a spectacular 4.4% in the morning trading session, boosted by surprise Bank of Japan measures to loosen monetary policy and restimulate and reinflate the economy. Following the results, Sony shares drifted back to JPY2,072, a gain of just 0.8%.
The promised central bank moves weakened the Japanese Yen, something which should boost the local currency value of Sony’s overseas sales.