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Wednesday, Oct. 31, 2007
Battery recall charge stings Matsushita's bottom line
Saddled with losses stemming from a recall of lithium-ion batteries in Nokia mobile phones, Matsushita Electric Industrial Co. said Tuesday its group net profit for the April-September period dropped 8.7 percent from a year ago to ¥105.1 billion.
Matsushita played down the profit decline, saying last year's profit for the same period had been inflated by a one-time gain of ¥27.3 billion from the sale of shares in its cable broadcasting business.
Meanwhile, Matsushita raked in ¥220 billion in operating profit, up 6.1 percent, on record sales of ¥4.5 trillion, which increased 3.1 percent thanks to strong sales of digital cameras and mobile phone handsets.
In recent months, Matsushita's battery subsidiary, Matsushita Battery Industrial Co., has been bleeding the parent with faulty batteries and a fire that damaged its plant.
In August, Matsushita said it will shoulder the cost of recalling 46 million lithium-ion batteries for Nokia handsets due to overheating problems. The batteries were made by Matsushita Battery between December 2005 and last November.
Matsushita Battery's lithium battery plant in Osaka has been shut since a fire broke out Sept. 30. The plant is scheduled to resume production Thursday.
Victor sinks into red
Struggling home electronics maker Victor Co. of Japan has reported that its group net balance for the first six months of business 2007 fell into the red and says its full-year net loss will be almost twice as large as initial projections.