Sharp posts full-year loss; Hon Hai executive to take helm

Japanese electronics maker Sharp said Thursday it suffered a $2.3 billion annual loss and released no forecast for the current business year as it assesses the impact of its acquisition by Taiwan's Hon Hai.

The company also said that an executive from Hon Hai, the world's biggest electronics supplier, will take over as president.

In March, Sharp agreed to the buyout that will see Hon Hai, better known as Foxconn, take a 66 percent stake for $3.5 billion after the Japanese industrial mainstay was pummelled by huge losses and mounting debts.

It was the first foreign acquisition of a major Japanese electronics firm and marked a watershed for Japan's once-mighty home electronics sector, which nurtured global brands including Sony and Panasonic but has struggled in the face of foreign competition.

Sharp said its net loss for the year to March swelled to 256.0 billion yen ($2.3 billion) from 222.3 billion yen the year before, resulting in liabilities exceeding assets.

Sales fell 11.7 percent to 2.5 trillion yen, while its operating loss ballooned to 162.0 billion yen from 48.1 billion yen in the red a year earlier.

Sharp said it plans to release its full-year forecast to next March as soon as the deal with Hon Hai is completed, stressing it is "difficult to precisely calculate" its impact at present.

Local media said Sharp is considering slashing some 3,000 jobs at home, or about 15 percent of its domestic workforce, including at subsidiaries.

Sharp denied the news reports but the Yomiuri Shimbun, Japan's top-selling daily, said the planned cuts are expected to target the solar power business and management positions at headquarters.

Sharp also said Hon Hai corporate executive vice president Tai Jeng-wu would become Sharp's new president, replacing Kozo Takahashi.

"He is a very powerful man and number two in Hon Hai," Takahashi was quoted by the Nikkei business daily as telling reporters of Tai.

Takahashi added that the 64-year-old Tai, who joined Hon Hai in 1986 and can speak Japanese, was chosen "from a general viewpoint" though did not elaborate.

Takahashi also said the firm would move its headquarters from Osaka to the neighbouring city of Sakai, where its main display plant is located, as part of its streamlining effort.

Over the last decade Sharp bet almost everything on liquid crystal displays (LCDs), boasting the most advanced technology in the world.

But that turned into a weakness when the market became more competitive after the 2008 global financial crisis and lower-cost rivals dug into Sharp's profits. 

While the firm still produces cutting-edge LCD screens, it has lacked the huge research and development funds necessary to keep ahead of the competition.