Sales up but profits down

Revenues at Japanese electronics maker Toshiba rose 18.5 per cent in the most recent quarter to $17.7bn.

However, profits fell 28 per cent after the book value of some property and other holdings was revised sharply downwards as Toshiba prepared to sell the assets.

"The PC business saw significant sales growth over the same period a year ago on increased unit sales, primarily in the US and Europe, and the retail information systems and office equipment business also saw sales growth," the company said in a statement.

Masaya Yamasaki, a Tokyo-based analyst at Nomura Financial & Economic Research Center, said: "Toshiba has increased its strategic investment in core segments including semiconductors and social infrastructure, and is concentrating resources on these areas through the sell-off of non-core assets such as land."

Results from other Toshiba divisions were mixed. Sales were up in TVs and optical disk drives, while sales of hard disk drives were "sluggish", the firm announced.

However, despite the rise in TV sales, Toshiba vice president Fumio Muraoka admitted that the company made a substantial loss in flat-screen TVs.

"Strong sales of non-major TV manufacturers in the US and cheaper [rival] products pushed down our sales," Muraoka told the Japan Times.

While strong profits continued at Toshiba's memory chip business, LCD sales and profits declined on lower sales of LCDs for mobile phones and the ongoing fall in panel prices.

Toshiba admitted in its financial filings that the company is "highly reliant " on the electronic devices segment, which includes memory chips and LCDs, for its operating income.

"Looking ahead, we think that Toshiba should be able to exceed the industry with average annual operating profit growth of around 20 per cent, with Nand Flash memory as the driving force," said Nomura's Yamasaki.