Matsushita cuts forecast, cites Japanese stock drop

Matsushita Electric Industrial Co. Ltd. cut its financial expectations Friday for the first half of its 2002 fiscal year. The company now expects a pretax loss of 68 billion yen (US$560.1 million) for the six-month period, up from the 45 billion yen loss it predicted in late July when it announced its first-quarter results.

Matsushita -- best known for its Panasonic brand -- maintained its earlier sales forecast for the period of 3,380 billion yen, down 10 percent from the year-earlier first half.

The company blamed the revised forecast on recent, sharp declines in Japanese equities, which caused one-time revaluation losses on some of the company's securities holdings.

Matsushita did not comment Friday on sales trends during the just-ended quarter, but in July it reported across-the-board declines during the quarter ended June 30. Sales of cell phones and IT-related components and devices slumped, while home appliance sales dropped 3 percent and industrial equipment sales plunged 28 percent over the year-earlier period, the company said.

Video and audio equipment sales were the one bright spot during the first quarter: TVs, music CDs, car audio and visual equipment and CD-R/RW (compact disc-recordable/rewritable) drives all showed sales gains over the year-ago quarter.

Shares of Matsushita (MC) dropped 2.09 percent, to $12.63, in early trading Friday on the New York Stock Exchange.

The first half of Matsushita's 2002 fiscal year ended Sept. 30. The company is expected to announce its quarterly results Oct. 30.

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