Fujikura Posts Lower Profits for Electronics Business Unit in 1H

Fujikura announced on Monday the sales and profits increased for metal cable and telecommunication business units in the first half of fiscal 2006 ending March 2007 from the same period of fiscal 2005, while the profits decreased for electronics & auto business unit even with increasing sales, the main product of which is flexible print circuit (FPC). The operating profit for electronics & auto business unit decreased by 12% to 8.7 billion yen in 1H of fiscal 2006 from 9.9 billion yen in 1H of fiscal 2005 due to decrease of unit price and sales margin of FPC. The firm estimated operating profit for the unit would decrease to 19 billion yen through fiscal 2006 from 24.7 billion yen in fiscal 2005.The sales for electronics & auto business unit increased by 42% to 119.8 billion yen in 1H of fiscal 2006 from the same period of fiscal 2005. Fujikura enjoyed favorable sales of connector for FPC, electric wire and hard disc drive parts. The sales of automotive wiring harness were also steady. The sales increased by 42.5% to 19.1 billion yen for connectors and by 56% to 20.9 billion yen for auto related products. The sales also increased by 19.8% to 44.2 billion yen for FPC. However, Kazuhiko Ohashi, president of Fujikura, said operating profit to sales ratio of FPC business would decline by 4-5 percentage points through fiscal 2006 from fiscal 2005.As to telecom business unit, the sales increased by 22% to 57.1 billion yen and operating profit increased to 2.5 times or 7.1 billion yen in 1H of fiscal 2006 from the same period of fiscal 2005 thanks to active demand for optical fiber network to household. The firm could post 3.2 billion yen of operating profit for metal cable & system business unit in 1H of fiscal 2006, while suffered from 200 million yen of operating loss in 1H of fiscal 2005. Demand was active and price hike advanced mainly for industrial cable in half year to September 2006. The sales for the unit increased by 67% to 30.7 billion yen, 34 billion yen of which was due to surge of copper price.Fujikura estimated 241 billion yen of sales and 19 billion yen of operating profit for electronics & auto business unit through fiscal 2006, 264 billion yen and 6 billion yen for metal cable & system business unit and 117 billion yen and 14 billion yen for telecom business unit.