TOSHIBA FORECASTS 11 PCT RISE IN 1987/88 GROUP NET
Toshiba Corp <TSBA.T> expects to report a
group net profit of 38 billion yen for the year ending March
31, 1988, up 11.2 pct from a year earlier, assuming an exchange
rate of 140 yen to the dollar, a company official said.
    Osamu Iemura, a senior vice president, told a news
conference sales are forecast at 3,500 billion yen, up 5.8 pct.
The forecasts are based on expectations of improved sales of
office automation equipment, a recovery in semiconductor market
prices and an increase in plant exports.
    Toshiba said earlier that 1986/87 group net profit fell
42.5 pct from a year earlier to 34.18 billion yen, the second
consecutive year-on-year drop. Sales fell 1.9 pct to 3,308
billion yen, the first year-on-year sales drop in 21 years.
    Iemura said the results reflected trade friction over
semiconductor exports to the U.S., The yen's sharp rise against
the dollar and a drop in exports to China.
    The 1986/87 foreign exchange loss totalled 145 billion yen,
including parent company losses of 120 billion.
    The average value of the yen against the dollar rose to 161
from 221 a year earlier, he added.
    Weaker prices for semiconductors and office automation
equipment cut total sales 245 billion yen, Iemura said.
    Group sales of telecommunication and electronic devices,
accounting for 36 pct of the total, rose five pct to 1,183
billion yen in 1987/88 from a year earlier, helped by good
sales of word processors, workstations, medical equipment,
point-of-sales systems and exports of personal computers.
    Semiconductor sales rose to 410 billion yen from 360
billion a year earlier but fell short of an expected 430
billion. Sales are expected to be 460 billion in 1987/88.
    Office automation equipment sales rose to 650 billion yen
in 1986/87 from 600 billion a year earlier, Iemura said. Sales
in 1987/88 are expected to be 695 billion yen, mainly due to
good sales of computers in Europe and to expectations the U.S.
Will remove its 100 pct import duty on computers.
    Sales of heavy electric goods, accounting for 26 pct of
sales, rose 0.2 pct from a year earlier to 868.14 billion yen.
    Home electronics sales fell 10 pct to 940.64 billion yen,
mainly due to the yen's appreciation against the dollar and a
drop in colour television exports to China, Iemura said.
    Overall 1986/87 overseas sales totalled 1,021 billion yen,
down three pct from a year earlier, Iemura said.
    Overseas sales of telecommunication and electronic devices
rose nine pct from a year earlier to 493.90 billion yen, helped
by a 80 pct year-on-year rise in computer and computer-related
equipment sales.
    Home appliance sales abroad fell 24 pct to 312.10 billion,
mainly due to the yen's appreciation, lower sales to China, and
increased competition with newly-industrialised countries.
    Toshiba reduced the number of divisions to three from four
in reaction to market changes, effective April 1.
    Group sales of telecommunication and electronic devices are
estimated at 1,520 billion yen in 1987/88, Iemura said.
    Home appliance sales are estimated at 1,260 billion yen and
heavy electric goods sales at 720 billion.
    Iemura said group exports to China are expected to rise to
90 billion yen in 1987/88 from 30 billion in 1986/87 due to an
increase in sales of generators.
    Sales to China were down from 70 billion yen in 1985/86 due
to a sharp drop in home appliance exports, he said.
    Group capital spending in 1987/88 will fall to 197 billion
yen from 213.30 billion in 1986/87, Iemura said.
    Of total capital spending, investment in semiconductors
will fall to 65 billion from 68 billion.
    Research and development spending will rise to 217 billion
yen from 201.10 billion, he said.
 REUTER
