Page last updated at 11:27 GMT, Tuesday, 28 July 2009 12:27 UK

Hitachi losses set to continue

Hitachi mobile phone
Hitachi forecasts a net loss of 270bn yen this year

Hitachi has reported a quarterly loss amid continued weakness in consumer demand for electronic products.

Hitachi made a net loss of 82.7bn yen ($875m; £530m) in the April to June quarter, compared with a 31.6bn yen profit in the same period a year ago.

The firm also reiterated its forecast for a third consecutive annual loss.

Meanwhile, camera and office equipment maker Canon saw second-quarter net profits fall 85% to 15.6bn yen, as firms cut back on printers and copiers.

Canon also increased its cost-cutting target for this year.

It plans to reduce costs by 220bn yen in 2009, from an earlier target of 172bn yen.

Buy-out plans

Hitachi expects to make a loss of 270bn yen this year.

The firm made a loss of 787.3bn yen last year - a record for a Japanese manufacturer.

It has also announced plans to buy out five listed subsidiaries. It will launch a $2.9bn bid for the units to try to return the group to growth.

Hitachi executive vice president Takashi Miyoshi said it would be able to cover the cost of the tender offer with further borrowing from banks.

One analyst said that trying to raise the money from shareholders would have been difficult.

"If Hitachi issued new shares, it would be a hard sell right now, since it has yet to put forward a convincing road map back to profitability," said Yuichi Ishida from Mizuho Investors Securities.



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