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Matsushita Blames Trade Friction, Yen as Net Drops

May 26, 1987|From Reuters

TOKYO — The world's largest maker of home electronics goods, Matsushita Electric Industrial Co., said Monday that the strong yen and trade friction were hampering its sales abroad of video tape recorders and other appliances.

In a report on recent business, Matsushita said the drop in exports had cut deeply into its overall sales and reduced its profit for the four-month period to March 31.

The company said in a statement that the appreciation of the yen and an increase in international trade friction had a negative impact despite its attempts to improve the situation by introducing new products and strengthening overseas production. Exports to North America were particularly limited by the strong yen.

To combat the yen's strong value against the dollar Matsushita has tried to sell new, innovative products and increase production overseas.

A downturn in sales of video tape recorders, Matsushita's major source of revenue, weighed heavily on the company's achievements for the term.

Matsushita also sees the powerful yen further aggravating its shipments overseas during the current business year through next March, but is hoping its total sales and profit will head upward on more sales of its goods in Japan, a company spokesman said.

Shipments abroad are likely to tumble 8% over the year, but demand at home should rise 7%, boosting total sales 2% from the same period a year ago, he said.

The mammoth manufacturer, which markets National, Panasonic, Technics and Quasar brands, expects sales during the current year to reach $22.4 billion.

Though the strong yen will continue to dampen sales of video tape recorders in the United States, its largest overseas market, demand in other parts of the world should become more favorable, the spokesman said.

Matsushita also sees an increase in sales later in the year through more demand for its sophisticated "super VHS" video recorder.

In the recent four-month term, sales tumbled 7% against the same period a year ago to $7.26 billion, while profit after taxes and other expenses dropped 22% to $193 million.

The irregular four-month term is because Matsushita changed its business year to start April 1 instead of Nov. 21.

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