EPSON NET RISES 49%

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Seiko Epson Net Rises 49% on Higher-Margin Printers
FEB.07 — Seiko Epson Corp., the world’s second-biggest inkjet printer maker, said third-quarter profit rose 49 percent on higher-margin multifunction office machines.Net income climbed to 13.5 billion yen ($111 million) in the three months ended Dec. 31, from 9.1 billion yen a year earlier, the Suwa, central Japan-based company, said in a statement today. Sales fell 13 percent to 396.7 billion yen because of price decreases at its printer and liquid-crystal display businesses.Seiko Epson is focusing on printers that can also photocopy and fax to drive earnings as it cut shipments of lower-end models. The company has 20 percent of the inkjet market, half the size of leader Hewlett-Packard Co.’s 40 percent share, according to researcher Gartner Inc.“It is a positive move that the company is approaching its target of increasing profitability,” Yuuki Sakurai, who helps manage the equivalent of $32 billion in stocks and bonds at Tokyo-based Fukoku Mutual Life Insurance Co. “The company’s future is pretty bright.”Operating profit, or sales minus the cost of goods sold and administrative expenses, rose 48 percent to 25.3 billion yen from 17.1 billion yen a year earlier, the company said.Exchange rate gains added 4.6 billion yen to operating profit as the yen weakened against the euro and the dollar, Kenji Kubota, Seiko Epson general managing director, said today at a news conference in Tokyo.The company today lowered its annual sales forecast to 1.41 trillion yen for the year ending March 31, from an October forecast for 1.43 trillion yen and compared with 1.55 trillion yen the previous year.The company today revised its full-year estimates for average exchange rates to 116 yen from 114 yen versus the dollar and to 148 yen from 146 yen against the euro.Full-year profit will probably be 14 billion yen in the year to March 31, the company said today, leaving its previous forecast unchanged.Sales at its printer and projector business fell 9.1 percent to 269.9 billion yen, accounting for 68 percent of total revenue. Operating profit at the division more than doubled to 32.5 billion yen from 15.1 billion yen a year earlier.Revenue at its electronics device unit, including LCDs and semiconductors, fell 23 percent to 113.1 billion yen. The unit had a loss of 5.7 billion yen, compared with 3.2 billion yen profit a year earlier.Shares of Seiko Epson fell 1.3 percent to 3,140 yen at the close on the Tokyo Stock Exchange. The results were released after the market closed. 

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February 8, 2007 at 11:10 AM