Sharp Back Paying A Dividend As Profits Soar
I recently had dinner with several Foxconn executives in Hong Kong and what was staggering was their passion to get Sharp back into being one of the top three TV brands in world.
After acquiring the loss making Japanese Company Sharp in 2016, Foxconn a Taiwanese Company who makes the bulk of Apple products, is set to use their 8K TV technology to take on the likes of Samsung LG and in the Japanese market Panasonic with a new generation of Sharp TV’s.
On Friday Sharp reported a net profit of $642 million for the year ending in April. The bulk of the profits came from liquid crystal displays which helped break a three-year run of losses despite weak orders related to Apple’s iPhone X.
The Osaka-based electronics maker booked a net loss of $226M a year earlier.
Sharp is set to pay a dividend for the first time since the year ended March 2012.
Despite the success with Sharp Foxconn is now having to cope with a major slowdown in iPhone X production, which delivered Foxconn its first yearly profit drop in nearly a decade.
The Sharp comeback was fuelled by efforts to cut costs and broaden sales channels which in the future will include Australia according to Foxconn executives.
“We’ve carried out structural reforms under the new management of current Chief Executive Officer Tai Jeng-Wu and we have recovered our finances to the point where we’re now able to pay dividends,” Sharp Executive Vice President Katsuaki Nomura said at a press conference in Tokyo.
“We’ll continue to expand our operations, achieve goals, enhance our profitability and improve our finances,” he said.
But while the company has returned to profitability, Nomura said it has more to work on to get back on a sustainable growth track.
“We’ve only come halfway through. We need to carry out our (three-year) medium term business plan (through fiscal 2019) fully to say we’ve revived,” he said.
Hon Hai of Taiwan, which assembles Apple Inc.’s iPhones and is also known by its trade name Foxconn, acquired Sharp in August 2016 to fix the Japanese company’s finances.