Hitachi 4Q Profit Quadruples; No Outlook Given

EnergyReuters

Hitachi Ltd said its fourth-quarter net profit quadrupled on cost cuts and booming demand for chip and construction equipment, but it gave no forecast for the new business year, citing uncertainties after Japan's massive March 11 earthquake and tsunami.

Japan's largest industrial electronics company has been overhauling its sprawling empire of some 900 units by shedding unprofitable businesses.

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Cost cuts, sales of fixed assets and strong sales in emerging markets of its automotive parts, elevators and excavators helped it to post an 18.7 billion yen ($231 million) net profit for January-March despite about 75 billion yen in earthquake-related damage.

Analysts expect Hitachi to earn an annual net profit of 216 billion yen in the year that started on April 1, according to the Thomson Reuters Starmine SmartEstimate, which puts more weight on the recent forecasts by top-ranked analysts. For the year just ended, Hitachi posted a net profit of 238.9 billion yen.

Hitachi, which sold its struggling hard drive operations to Western Digital Corp in a $4.3 billion deal in March, is anticipating robust sales in emerging markets as well as demand for construction equipment, smart grids, cables and other infrastructure to rebuild Japan's quake-ravaged northeast.

"The impact of the quake will be felt in earnings this year, but we are still assessing that impact," Takashi Miyoshi, a senior Hitachi executive, told a news conference, adding that the company hoped to announce an annual forecast on June 9, along with its midterm goals.

The company, which makes a wide range of products from washing machines to nuclear reactors, posted a quarterly operating profit of 106.6 billion yen, down 34 percent, on a 5 percent sales decline, as the quake and tsunami disrupted its supply chains and damaged plants in the region.

Its results were broadly in line with expectations after an April 27 pre-announcement.

Ahead of the results announcement, Hitachi shares closed down 0.2 percent at 451 yen in line with Tokyo's electrical machinery subindex .

Shares in the company, which supplies nuclear reactors to Tokyo Electric Power Co , have fallen by 9 percent since the March 11 quake, underperforming the index's 5.6 percent fall. ($1 = 80.835 Japanese Yen) (Reporting by Mayumi Negishi; Editing by Anshuman Daga and Edmund Klamann)

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