Slow Demand Impacts on Japan Electric Wire Makers’ Results

Japanese 5 electric wire makers out of major 6 posted lower consolidated recurring profit for the first half year to September from same period of last year. The slower demand for automobile, electronics and construction impacted on the profitability along with higher cost for materials and energy, higher yen rate and higher depreciation under new tax rule. The all 6 makers revised the outlook downward for the fiscal 2008 ending March 2009.

Sumitomo Electric Industries reported the automotives business unit’s operating profit decreased by 30% to 24.4 billion yen for the first half from same period of 2007. The firm expects severe market condition for the second half when major automakers plan to reduce the output.

Furukawa Electric posted lower recurring profit for the first half from same period of 2007 partly due to 2.8 billion yen of negative impact from foreign exchange. The firm expects 7 billion yen of negative impacts on operating profit from higher cost for oil and subsidiary materials for fiscal 2008.

Fujikura posted higher recurring profit for the first half from same period of 2007 thanks to gain from foreign exchange and lower maintenance cost. The firm expects the electronics & auto unit regains profitability for fiscal 2008.

Hitachi Cable expects the net loss for fiscal 2008 due to lower sales for automotive parts in North America and tape automated bonding for liquid crystal panel. SWCC Showa Holdings posted net loss for the first half and expects net loss for the full year.