Hitachi warns of falling profits

Hitachi makes a wide range of products including hard drives

Shares in Hitachi have fell 8.5% in Tokyo after the electronics firm warned that it will report its second consecutive annual loss this year.

Hitachi blamed poor television sales and a tax write-down and said that 2008 could be even worse if the yen stays strong against the dollar.

It changed its forecast from a 10bn yen ($100m; £50m) profit to a 70bn yen net loss for the year to the end of March.

Hitachi makes everything from nuclear reactors to computer hard drives.

The dollar has fallen to a recent low against the yen on worries that the credit crunch is spreading in the US.

Plasma consolidation

Many manufacturers of plasma TVs are teaming up to reduce costs.

The fifth biggest manufacturer Pioneer recently decided to stop making its own panels and buy them from Matsushita instead.

"I don't see where Hitachi's plasma display business is heading," said Sohichi Yamazaki from Fukoku Capital Management.

"Hitachi better take some action soon."