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Significant profit rise at Toshiba

Significant profit rise at Toshiba

Stronger sales of several major product lines helped Toshiba achieve higher sales and profits for the first six months of the current financial year.

The company reported a 166 percent jump in net income against the same period a year earlier to ¥38.8 billion (US$330 million) on the back of a nine percent rise in sales to ¥3.16 trillion. Operating income, which more closely tracks profitability in the company's core business, rose 27 percent to ¥65.2 billion, Toshiba says.

Sales of digital products rose 13 percent on demand for Toshiba's TV sets, hard-disk drives and optical drives. PC sales, primarily in North America and Europe, rose by 18 percent but price competition in the PC sector coupled with an unfavourable exchange rate caused the digital products division to post a first-half loss of ¥7.6 billion. It was the only one of Toshiba's four main business areas to lose money during the first half.

Toshiba's electronics devices segment also saw a 13 percent jump in sales thanks to brisk demand for memory chips, system LSI (large scale integrated circuit) chips and LCD (liquid crystal display) panels. Profits also rose due to high profits from the semiconductor business.

For the full year Toshiba raised its financial forecast. Citing good business in its power systems and medical systems businesses, Toshiba says it now expects net sales to be ¥6.75 trillion for the year from April 2006 to March 2007. That's an increase of two percent on the company's previous forecast and, if achieved, would represent a six percent rise on last year's sales.

The operating income forecast was raised from ¥265 billion to ¥270 billion and net income is now expected to be ¥110 billion against Toshiba's original estimate of ¥90 billion.

Toshiba First-Half Earnings Table

April to Sept. 2006April to Sept. 2005Percentage change
Sales¥3.16 trillion¥2.9 trillionup nine percent
Operating income¥65.2 billion¥51.4 billionup 27 percent
Net income¥38.8 billion¥14.6 billionup 166 percent
Source: Toshiba

Toshiba FY2006 Earnings Forecast

New forecast (Oct. 31)Previous forecast (April 28)ChangeActual results FY2005
Sales¥6.75 trillion ¥6.6 trillionup ¥150 billion¥6.3 trillion
Operating income¥270 billion¥265 billionup ¥5 billion¥240.6 billion
Net income¥110 billion¥90 billionup ¥20 billion¥78.2 billion
Source: Toshiba

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