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Tuesday November 20, 10:59 AMSanyo to focus on batteries in mid-term plan: reportTOKYO (Reuters) - Japan's Sanyo Electric Co aims to double sales of its solar cells in the next three business years and to boost rechargeable battery sales by 50 percent to drive its turnaround, the Nikkei business daily said.The struggling electronics maker, restructuring with the help of Goldman Sachs , is set to unveil basic strategies for its mid-term business plan on November 27, as well as earnings results for the fiscal first half through September. Sanyo's operating profit likely totaled about 25 billion yen ($228 million), beating its own forecast in May of 10 billion yen, thanks to robust demand for its batteries and digital cameras, the Nikkei said on Tuesday. Sanyo is the world's largest rechargeable battery maker. Its lithium-ion batteries are used in four of every 10 mobile phones. The Osaka-based company, however, is expected to stand by its full-year operating profit forecast of 45 billion yen due to uncertainty in the U.S. economy, the newspaper said. That would be down 9.2 percent from a year earlier and fall short of a consensus of a 48 billion yen profit in a survey of nine analysts by Reuters Estimates. In the closely watched three-year turnaround scheme, the company plans to invest 110 billion yen in its solar cell business to double annual sales to 120 billion yen by the year ending March 2011, the newspaper said. Sanyo also plans to invest 100 billion yen in its rechargeable battery operations to boost sales by 50 percent to 450 billion yen or more, the paper said. A Sanyo spokesman declined to comment. The Nikkei also said Sanyo will invest 20 billion yen in its semiconductor unit, mainly to upgrade equipment. Last month Sanyo gave up on the sale of its microchip unit after private equity firm Advantage Partners LLP failed to gather enough funds to support its bid of about $1.1 billion. The Nikkei said Sanyo would make the investment in the belief that it can generate steady earnings. The paper also said Sanyo aims to conclude a deal to sell its mobile phone operations to electronic components and cellphone maker Kyocera Corp by the end of this year. The consumer electronics maker said last month it had reached a basic agreement to sell its loss-making mobile phone business to Kyocera, creating the world's seventh-largest cellphone provider, but the selling price has yet to be fixed. Shares in Sanyo were down 1.7 percent at 176 yen by midday, slightly outperforming the Tokyo stock market's electrical machinery index , which fell 2.1 percent. (Reporting by Nathan Layne, Kiyoshi Takenaka; editing by Malcolm Whittaker) |
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