Mitsubishi Electric Corp. on Friday revised downward its earnings projections for the first half of fiscal 2001, blaming the plunge in global demand for semiconductors and mobile phones.
Mitsubishi will post consolidated pretax losses of 20 billion yen during the April-September period, compared with an earlier projection of 20 billion yen in consolidated pretax profits.
Its consolidated net profits will come to 2 billion yen from an earlier forecast of 15 billion yen. Group sales will fall to 1.8 trillion yen from a previous forecast of 1.92 trillion yen.
For the full business year to March, the major electronics maker also estimates consolidated pretax losses of 20 billion yen, compared with an earlier forecast of 120 billion yen.
Its consolidated net profits will come to 2 billion yen from a previous projection of 75 billion yen. Group sales will decrease to 3.9 trillion yen from an earlier forecast of 4.3 trillion yen.
Mitsubishi also announced that it will streamline mobile telecommunication operations in North America and in Europe.
The firm will shut down Mitsubishi Wireless Communications, Inc., its North American unit for mobile telecommunication businesses, in March. Consequently, all 155 workers of the U.S. firm will be dismissed, the company said.
Mitsubishi will write off a total of 70 billion yen for the streamlining efforts in the first half of fiscal 2001. Restructuring measures for Europe have yet to be decided, said Yukihiro Sato, a Mitsubishi board member.
As part of efforts to take responsibility for the deteriorating performances, Mitsubishi's regular board directors will have their monthly salaries cut by 5 to 15 percent from next month until the company recovers profitability, Sato said.
Sato also said a sharp decline of stock prices and drastic appreciation of the yen due to the terrorist attacks in the U.S. may worsen the company's profitability.