OMEN
01-31-2009, 12:03 PM
About half of layoffs will be in Japan, the others from overseas
NEC Corp. plans to lay off 20,000 workers, close factories and withdraw from some business areas as a result of the poor economic conditions, the company said today.
The company, one of Japan's biggest electrical and electronics companies, will lay off 9,500 staff in Japan, look to early retirement for a further 450 domestic staff and cut 9,000 workers overseas.
NEC didn't give details of where the layoffs will hit and which divisions will be closed. But the company said it will pursue "substantial reform" at its chip-making subsidiary, NEC Electronics.
NEC had been hoping to make a ¥15 billion ($166 million U.S.) net profit in its current financial year, which runs until March, but is now expecting a net loss of ¥290 billion due to poorer than expected business, write-downs on investments and the restructuring. It expects sales for the full year of ¥4.2 trillion, which, if realized, would be a 9% drop on actual sales in the previous year.
In the last three months of 2008, NEC's fiscal third quarter, the company recorded a loss of ¥131 billion on sales of ¥948 billion. In the same period a year earlier, it lost ¥5 billion on sales of ¥1.1 trillion.
Results in its information technology and network systems business were mostly in line with expectations, but NEC's cell phone handset and semiconductor units suffered because of a drop in demand. The strong Japanese yen also hurt profits from overseas business.
IDG
NEC Corp. plans to lay off 20,000 workers, close factories and withdraw from some business areas as a result of the poor economic conditions, the company said today.
The company, one of Japan's biggest electrical and electronics companies, will lay off 9,500 staff in Japan, look to early retirement for a further 450 domestic staff and cut 9,000 workers overseas.
NEC didn't give details of where the layoffs will hit and which divisions will be closed. But the company said it will pursue "substantial reform" at its chip-making subsidiary, NEC Electronics.
NEC had been hoping to make a ¥15 billion ($166 million U.S.) net profit in its current financial year, which runs until March, but is now expecting a net loss of ¥290 billion due to poorer than expected business, write-downs on investments and the restructuring. It expects sales for the full year of ¥4.2 trillion, which, if realized, would be a 9% drop on actual sales in the previous year.
In the last three months of 2008, NEC's fiscal third quarter, the company recorded a loss of ¥131 billion on sales of ¥948 billion. In the same period a year earlier, it lost ¥5 billion on sales of ¥1.1 trillion.
Results in its information technology and network systems business were mostly in line with expectations, but NEC's cell phone handset and semiconductor units suffered because of a drop in demand. The strong Japanese yen also hurt profits from overseas business.
IDG