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Saturday, Oct. 28, 2006

Matsushita scores huge in flat-panel TV market


Staff writer

Matsushita Electric Industrial Co., maker of the Panasonic brand, said Friday that its group net profit jumped 78.7 percent to 115.1 billion yen in the April-September period, thanks to brisk sales of its flat-panel plasma televisions and air conditioners.

The company's sales climbed to a record 4.39 trillion yen, up 3.1 percent, in its first half of the current fiscal year.

Operating profit also rose 21.2 percent to 207.4 billion yen, the highest in 16 years, while pretax profit was 232.5 billion yen, up 50.8 percent from the same period last year.

The pretax, operating and net profits at the Osaka-based company in the first half of the year increased for the fifth straight year.

Asked about the reasons for the solid profit gains, Matsushita Vice President Tetsuya Kawakami boasted that prices of its flat-panel display TVs did not fall as much as those of other companies, contributing to the abundant profit.

"Prices of flat-panel display televisions fell about 20 percent in the period in the industry, but prices of our products dropped an average of 13 percent," Kawakami said. "If we look at the domestic market alone, the prices increased 3 percent."

Matsushita sold 1.38 million plasma TVs and 980,000 liquid crystal display TVs in the first half of the year.

Although the company initially said it plans to sell 4 million plasma TVs this year, Kawakami revised the figure downward to 3.7 million since customers are purchasing more expensive TVs with larger displays, pushing down the number of units.

"We plan to focus on bigger displays," Kawakami said. "In Japan, about 15 percent of the customers buy 50-inch flat-panel display TVs, but we hope to increase this figure to more than 20 percent."

In the home appliance sector, which includes air conditioners and laundry machines, Matsushita posted an operating profit of 40.3 billion yen, up 2 percent, on sales of 637 billion yen, up 6 percent.

Despite the brisk sales and profits, Matsushita did not revise its forecast for this fiscal year, citing intensifying price competition for its products in the second half of the year.

On Friday, Matsushita shares fell 45 yen, or 1.74 percent, to 2,530 yen on the Tokyo Stock Exchange. Matsushita announced the financial report after the market closed.



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