Osram sees big rise in net income for new fiscal year
MUNICH (Reuters) - German lighting maker Osram Licht AG (OSRn.DE: Quote) said it expects its net income to improve sharply in its current fiscal year after it cut jobs and shuttered factories to return to profit.
Osram, the world's No. 2 lighting maker after Philips (PHG.AS: Quote), is in the midst of a restructuring, having been slow to adjust to a shift in demand from traditional light bulbs to newer technologies such as light-emitting diodes (LEDs).
It said on Tuesday it was now cutting an overall 8,700 jobs, or 21 percent of its workforce, to generate gross savings of 1.2 billion euros ($1.6 billion).
So far, only two of Osram's remaining 36 factories make LEDs - in Regensburg, Germany and Penang, Malaysia - but it is building a new plant in China at a cost of over 100 million euros to boost its presence in the fast-growing Asian market.
Meanwhile, newer players in lighting such as South Korea's Samsung Electronics (005930.KS: Quote) and Japan's Toyoda Gosei (7282.T: Quote) are grabbing market share from traditional industry leaders - Philips, Osram and General Electric (GE.N: Quote).
In its year to the end of September, the company, spun off from Siemens (SIEGn.DE: Quote) earlier this year, swung to a net profit of 34 million euros from a year-earlier loss of 391 million thanks to its restructuring program and a gain from the sale of a stake in a joint venture.
That fell slightly short of analysts' consensus forecast of 38.2 million euros in a Reuters poll. <ID:L5N0IT2X7>
($1 = 0.7459 euros)
(Reporting by Maria Sheahan; Editing by Jonathan Gould)
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