Sony Posts Small Second-Quarter Profit, Keeps Full-Year Forecast

Sale of a chemicals business offset weak demand for Sony TVs

Japan's Sony Corp booked a small operating profit in the second quarter, after a loss a year ago, helped by the sale of a chemicals business that offset weak demand for its TVs and other devices, and it kept its full-year profit guidance.

July-September operating profit of 30.3 billion yen ($379 million) compared with a 1.64 billion yen loss a year ago, and was close to the average 33.8 billion yen profit estimated by five analysts surveyed by Thomson Reuters I/B/E/S.

The company recently completed the sale of its chemical business to state-backed Development Bank of Japan for 58 billion yen. Other asset sales may further inflate operating profit this business year.

Sony, which blazed a trail in the early 1980s with its Walkman portable music players, stuck to its forecast for a full-year operating profit of 130 billion yen ($1.63 billion). It had reduced that in August from 180 billion yen. Analysts predict a full-year profit of 107 billion yen. Last year, Sony reported an annual operating loss of 67 billion yen.

Sony cut its forecast for full-year sales of its hand-held PSP and Vita game consoles to 10 million from a previous forecast of 12 million. It also expects to sell fewer TV sets – 14.5 million – and compact digital cameras – 16 million – than it previously forecast, but kept its prediction for PlayStation home console sales at 16 million.

Panasonic Corp, a rival Japanese TV maker, said on Wednesday it will lose almost $10 billion this business year as it cleans its house of risky assets – writing down billions of dollars of goodwill and assets in its mobile and energy units and preparing for more restructuring that is likely to see it shift away from money-losing TVs and other consumer electronics. Its shares fell by a fifth on Thursday, wiping around $3 billion off its market value.

Shares in Sony, valued at less than $12 billion, have dropped around 19 percent since end-June and the cost of insuring against debt default for five years has jumped by almost 60 percent.