Japanese high-tech and energy giant Hitachi said Tuesday that it had reduced its first-quarter net loss by almost half, helped by higher sales of nuclear power equipment. Operating profit nearly doubled as lower earnings in IT systems and digital consumer products were offset by increases in the power and industrial systems division, the company said in a statement. Net losses narrowed to 13.62 billion yen (114 million dollars) in the three months to June from 22.04 billion yen a year earlier, a company statement said.
Operating profit jumped 43.2 percent to 24.54 billion yen as sales rose 10.2 percent to 2.48 trillion yen.
Hitachi got off to a better than expected start to the year "thanks to the benefit of a weak yen and recovery in the sales of our plant systems after last year's problem," said chief financial officer Toyoaki Nakamura.
Last year, the company slumped deep into the red due to costs to repair faulty turbines supplied to two nuclear power stations in Japan operated by Chubu Electric Power and Hokuriku Electric Power.
In the first quarter, revenue from power and industrial systems increased 22 percent and operating profit jumped 123 percent, buoyed by higher nuclear power sales in Japan and of thermal power plants overseas.
But the division making digital media and consumer electronics incurred an increased operating loss of 22.5 billion yen due to flagging sales in the fiercely competitive market for flat-panel televisions.
The average selling price of a Hitachi flat TV fell by 20-30 percent in the quarter to June from a year earlier, Nakamura said.
For the full year to March 2008, Hitachi maintained its forecasts for net profit of 40 billion yen and operating profit of 290 billion yen on revenue of 10.5 trillion yen.
Japan's nuclear power industry has come under close scrutiny since a major earthquake northwest of Tokyo on July 16 led to the closure of the world's largest nuclear power plant which suffered a small amount of radiation leakage.
Hitachi declined to comment on the possible impact on its business.
"As a manufacturer that is involved in the nuclear power business, Hitachi will closely cooperate with power companies in the area of seismic-resistant design," said Hitachi spokesman Hiroki Inoue.
Source: Agence France-Presse
