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Job Cuts And Financial Injection For Sharp In Wake Of FY Loss

Job Cuts And Financial Injection For Sharp In Wake Of FY LossSharp posted a net loss of 222.35 billion yen (around $2.3 billion) for the fiscal year, as opposed to net income of 11.56 billion yen last year, on net sales of 2,786.3 billion yen, down from 2,927.2 billion yen year-on-year.

While Sharp had managed to turn a profit last year, it acknowledged a number of factors in this year’s profit plunge.

“For the downturn in performance of our business, we self-evaluate the impact of the following factors; (1) Weakness in adapting to the changes with speedy action, (2) Delay of launching business in growing areas, (3) Weakened cost competitiveness, (4) Insufficient corporate governance and business management,” Sharp stated.

As Sharp comes to terms with a vastly changed consumer electronics market, it has announced it has secured 200 billion yen, entering into a subscription agreement with Mizuho Bank and The Bank of Tokyo-Mitsubishi UFJ.

Sharp has also entered into a subscription agreement with Japan Industrial Solutions, by which it will receive 25 billion yen.

Sharp stated it will undertake “fundamental restructuring”.

Sharp will re-build its current corporate structure, including two business groups and eight business units, into five companies as it seeks to reorganise its business portfolio and improve profitability.

The new structure will comprise: a consumer electronics company, an energy solutions company, a business solutions company, an electronic component and device company, and a display device company.

Sharp is additionally looking to cut around 3,500 jobs through a voluntary retirement program.

“We are aiming for a fresh start, one that will lead to a recovery,” Reuters reported Sharp chief executive Kozo Takahashi as stating at a news conference.