Ouch! Sony Hit with Additional £2 Billion loss
Kaz Hirai Struggling to Rescue Sony!
Ouch! Indeed, for Kaz Hirai. Taking over as the guiding hand at Sony on April 1st, he has to declare to the public on April 10th that, "Sony expects to record an aggregate additional charge of approximately 300 billion yen in tax expense in the fourth quarter of the fiscal year ended March 31, 2012, primarily due to the establishment of valuation allowances against certain deferred tax assets, predominantly in the U.S."
In short and no matter how you cover it in phrases such as, "valuation allowances against certain deferred tax assets", that is an additional £2.32 billion 'charge' for Sony. Indeed, even it points out that, "Due to the recording of this additional tax expense, net loss attributable to Sony Corporation’s stockholders is expected to be significantly greater than the February forecast."
In short, Sony will post a record net loss for last year of 520 billion yen (£4bn). This is more than double its February forecast - it's the company's fourth consecutive year of loss making.
As some context, Sony does explain that, "This additional tax expense is a non-cash charge and does not have any impact on Sony’s consolidated operating income (loss) or cash flow.
"As of April 10, 2012, no revisions have been made to consolidated sales, operating income (loss) and net income (loss) before taxes in the forecast announced on February 2, 2012."
Also, according to AP, "Sony has announced restructuring plans by selling its chemical unit. Sony is also merging its LCD panel operation with Toshiba and Hitachi. Yasukouchi said those changes could affect up to 5,000 employees who are subject to transfers."
Ouch again.
However, good news is forecast for the next year, with Sony stating that, "For the fiscal year starting April 1, 2012, with assumed foreign currency exchange rates of approximately 80 yen against the U.S. dollar and approximately 105 yen against the euro, Sony is currently forecasting that it will return to positive operating results and that its consolidated income for the fiscal year ending March 31, 2013 will be approximately 180 billion yen."
Source:
Sony
and
Sony again.
In short and no matter how you cover it in phrases such as, "valuation allowances against certain deferred tax assets", that is an additional £2.32 billion 'charge' for Sony. Indeed, even it points out that, "Due to the recording of this additional tax expense, net loss attributable to Sony Corporation’s stockholders is expected to be significantly greater than the February forecast."
In short, Sony will post a record net loss for last year of 520 billion yen (£4bn). This is more than double its February forecast - it's the company's fourth consecutive year of loss making.
As some context, Sony does explain that, "This additional tax expense is a non-cash charge and does not have any impact on Sony’s consolidated operating income (loss) or cash flow.
"As of April 10, 2012, no revisions have been made to consolidated sales, operating income (loss) and net income (loss) before taxes in the forecast announced on February 2, 2012."
Also, according to AP, "Sony has announced restructuring plans by selling its chemical unit. Sony is also merging its LCD panel operation with Toshiba and Hitachi. Yasukouchi said those changes could affect up to 5,000 employees who are subject to transfers."
Ouch again.
However, good news is forecast for the next year, with Sony stating that, "For the fiscal year starting April 1, 2012, with assumed foreign currency exchange rates of approximately 80 yen against the U.S. dollar and approximately 105 yen against the euro, Sony is currently forecasting that it will return to positive operating results and that its consolidated income for the fiscal year ending March 31, 2013 will be approximately 180 billion yen."
Source:
Sony
and
Sony again.
Companies:
Sony
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