Tags: Hitachi | Rebounds | Profit | Global | Recovery

Hitachi Rebounds to Profit on Global Recovery

Tuesday, 02 Nov 2010 03:09 PM

Hitachi Ltd. rebounded to profit in the second quarter from losses a year earlier as the global recovery boosted demand for the company's car parts, computer chips and electronics.

The Japanese company, which makes everything from nuclear reactors to home appliances and car engine parts, Tuesday reported a net profit of 71.9 billion yen ($898.8 million) for the July-September quarter — a turnaround from losses of 50.5 billion yen.

Quarterly sales edged up 5 percent to 2.350 trillion yen ($29.4 billion).

Tokyo-based Hitachi joins other major Japanese electronics makers in recovering from the plunge their earnings took the previous year. Both Sony Corp. and Panasonic Corp. reported strong quarterly results last week.

But all three companies, like other Japanese exporters, face an uncertain future because of the appreciating yen, which erodes revenue brought back to Japan and makes their products more expensive overseas.

Hitachi is expecting the dollar to trade at 80 yen for the second fiscal half through March 2011. It had estimated the dollar at 85 yen earlier this year.

Hitachi stuck to its forecast for the year through March 2011 of 200 billion yen ($2.5 billion) profit on 9.3 trillion yen ($116.3 billion) sales. The projection was raised last month despite the risks from the strong yen.

Quarterly sales rose in all major regions, except for Europe, gaining 2 percent in Japan, 3 percent in North America and a solid 22 percent in Asia outside Japan.

Cost cuts and restructuring were also behind the results, according to Hitachi.

Hitachi is hoping to boost competitiveness through what it calls "social innovation" businesses, including data centers, nuclear power plants and railway systems.

Hitachi shares were unchanged in Tokyo at 364 yen. Earnings were announced shortly after trading ended.

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Hitachi Ltd. rebounded to profit in the second quarter from losses a year earlier as the global recovery boosted demand for the company's car parts, computer chips and electronics. The Japanese company, which makes everything from nuclear reactors to home appliances and...
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