*NEWS*EPSON:RAISES $393 MILLION

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*NEWS*EPSON:RAISES $393 MILLION

 user 2006-03-21 at 10:20:00 am Views: 61
  • #15095

    Seiko Epson to Book 46.3 Bln Yen for Cost-Cut Plan
    March
    06– Seiko Epson Corp., the world’s second-biggest printer maker, will
    book 46.3 billion yen ($393 million) for restructuring costs this
    fiscal year as the company eliminates jobs and cuts production lines at
    its chip unit.

    The
    company will book a further 3 billion yen in the next business year
    ending March 31, 2007, President Seiji Hanaoka said at a media
    conference in Tokyo today. Suwa, Nagano-based Seiko Epson made the
    projections as part of its mid-term business plan.
    Seiko Epson is
    planning to cut its workforce in Japan by 11 percent over three years
    and slim down some of its factories as prices of semiconductors and
    flat-panel displays fall. Sales of printer ink and paper fell more than
    expected this year on increased competition from Canon Inc. and
    Hewlett-Packard Co.
    The restructuring plan will help add 64 billion yen to the company’s net income by March 2009, Hanaoka said.
    The
    company, which also makes cell-phone displays and chips, yesterday
    widened its full-year net loss forecast by 64 percent to 23 billion
    yen, citing a charge to write down the value of assets at a chip
    factory. The company reported a 55.7 billion profit a year ago. It kept
    sales, operating income and pretax profit forecasts for this fiscal
    year.
    Seiko Epson said in January it would eliminate 3,000 jobs in
    Japan over the next three years and book at least 42 billion yen to
    reflect declines in the value of assets in its electronics device unit.
    Today, the company said it eliminate about 100 jobs at its European
    office equipment operations.
    Three-Year Plan
    Sales in the next
    three years are expected to rise 7.5 percent to 1.67 trillion yen,
    Hanaoka said. For the next fiscal year starting April 1, sales will
    reach 1.59 trillion yen.
    The electronic devices unit, including cell
    phone displays and LCD chips, is projected to post an operating profit
    of 15 billion yen for the year ending March 2008, compared with a
    forecast for a 1 billion yen loss next fiscal year.
    Operating
    profit, or sales minus the cost of goods sold and administrative
    expenses, for the unit is expected to rise to 25 billion yen in the
    year ending March 2009.