Sony announce first annual profit in five years
Sony has reported an annual profit for the first time in five years. Profits have been boosted by a weakening yen and asset sales.
The electronics giant made a net profit of 43bn yen (£280m/$436m) in the year to 31st March. These figures reverse a loss of 457bn in the same period a year earlier.
The recent fall in the value of yen has made Japanese goods cheaper for foreign users to buy, which helped boost sales.
The weak currency also enables Japanese exporters to make more of a profit when they repatriate their earnings back home.
The Japanese currency has fallen more than 20% against the US dollar since November last year, after aggressive measures were launched to spur growth in the Japanese economy.
Sony said it expects profits to rise to 50bn yen in the current financial year.
Sony has seen its fortunes plummet over the last few years. Increased competition, falling prices and narrowing profit margins have hurt the business, especially in the TV industry, which has made a loss for the past 8 years.
Due to the falling profits, Sony has taken time to restructure its business model and reduce costs. The firm has sold asses over the last few months, including its US headquarters in New York and some shares in M3, a medical research and marketing firm. They have also sold their ‘Sony City Osaki’ building in Tokyo.
Sony has said the sale of these assets had resulted in gains of almost $2.5bn during the last financial year – and this figure contributed to the overall profit rise.
However, analysts have said that the impact of these sales did not reflect the overall success of the business. Gerhard Fasol of Eurotechnology Japan said the gains should ‘be subtracted from the results, to understand the regular operating results’.