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02
November
2012

Sharp close to bankruptcy?

Huge losses and a company concerned with whether or not it has enough time to restructure. Gloomy days for Japanese electronics giant Sharp.
Huge losses and a company concerned with whether or not it has enough time to restructure. Gloomy days for Japanese electronics giant Sharp.

Sharp saw sales drop 16 percent year-over-year to JPY1.1 trillion (EUR 10.6 billion) in the 1H of fiscal 2012 (ended September 30). The net loss widened to JPY 387.6 billion - not really comparable to the loss of (only) JPY 39.8 billion from the corresponding period a year ago.

"Sharp is in circumstance in which material doubt about its assumed going concern is found", the company writes in their fiscal report, essentially admittance of serious trouble.

Restructuring measures have been announced seeing 5'000 layoffs over the next 6 months. Furthermore, Sharp plans to sell off global manufacturing facilities. As reported before, the company is - for instance - currently in talks with EMS-giant Foxconn. It has been so for months in fact, but is confident that an agreement can be reached before March 2013.

Sharp also added it was considering other alliances as well.

To top it all up, Sharp has also been forced to revise its full-year outlook for the fiscal year ending March 2013. The company now says that its full-year revenue is expected to be around JPY 2.46 trillion (down from JPY 2.5 trillion). It also expects the losses to widen; from JPY 250 billion to JPY 450 billion).
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1 EUR = 103.64 JPY according to oanda.com (as of November 2, 2012)
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