Sharp posts Q3 profit, on course to clear earnings hurdle
By Reiji Murai and Tim Kelly
TOKYO (Reuters) - Sharp Corp (6753.T: Quote) eked out a quarterly operating profit on Friday, improving the bailed-out consumer electronics maker's chances of convincing lenders and shareholders that it remains a viable company.
Sharp stuck to its forecast for a 13.8 billion yen ($151 million) operating profit in the second half, after losing 168.9 billion yen in the first half as the maker of goods from airconditioners to televisions was savaged by lower-cost rivals.
"The results gave a sense of relief to investors as it was able to keep promises with its banks to turn around its business," said Makoto Kikuchi, chief executive of Myojo Asset Management.
"The next focus is whether the company can be profitable on a net basis for the next fiscal year," he added, warning that it faced potential restructuring costs.
Sharp reported a third-quarter operating profit of 2.6 billion yen ($28.5 million), compared with a loss of 24.4 billion yen a year ago and beating market forecasts for a small loss.
Its earnings were bolstered by robust sales of home appliances and mobile phones, along with a weaker Japanese yen that helped it compete overseas.
The group said it made money from its TV business in the third quarter but forecast deeper annual losses from LCD panels due to softer demand for small and medium sized panels for smartphones.
The turnaround will allow Sharp's banks to justify a bailout that last year kept the maker of Aquos TVs in business. It would also unlock further investment from Qualcom Inc (QCOM.O: Quote) that would make the U.S. chipmaker its biggest shareholder. Continued...