Ailing Sharp sacks chief, vows turnaround on robots, LCDs
Japan's Sharp booked another huge loss on Tuesday, and unveiled its latest turnaround plan, which includes relying on partnerships with Samsung Electronics and Foxconn Technology Group for business, sacking top management, and expanding into new fields such as robotics.
Osaka-based Sharp, one of the world's largest LCD screen makers but struggling under massive debt and unused capacity, said its losses for the year ended March 31 reached ¥545 billion ($5.4 billion), the largest in the company's history. Sharp promised its ongoing restructuring, involving thousands of job cuts and factory closings, will finally bear fruit this year in the form of a modest ¥5 billion profit.
The company said it will rebuild its tattered finances on products like laptop screens with the industry's highest pixel density at up to 262 pixels per inch, which it is to mass produce from June. The company has already found a customer for the screens in Samsung, according to local media reports. In March, Sharp secured a $110 million investment from Samsung and locked in the South Korean company as a long-term client.
Sharp said its turnaround will also include increasing income in its core LCD screen business to over $1 trillion in the year through March 2016. The company owns some of the largest factories in the world but has struggled with price falls and generating enough business to operate its lines. A deal signed with Foxconn last year gave that firm half control of one of Sharp's main LCD factories in return for a cash infusion and a steady stream of business.
Sharp also said it will focus on new businesses such as robotics. The company has had some success with its "Cocorobo" line of autonomous vacuum cleaners, a talking, voice-controlled line that is similar to the popular Roomba from U.S. maker iRobot. It said part of that effort will include a new partnership with Japanese power tool maker Makita.
The company is facing an ongoing cash crunch, with its debt rated junk status and even its office buildings leveraged as collateral. But it said Tuesday it had secured new loans worth up to ¥150 billion from its lenders and would generate enough additional cash to stay afloat.
Sharp also said it would replace its president, Takashi Okuda, with current Executive Vice President Kozo Takahashi, who will assume his new post in June.