Sharp Plays "Stayin' Alive", Sells Shares to Foxconn

is that the fab where the producing those 70", 80", and 90" panels?

Simple rule of thumb is Quattron is 10G and non Quattron is 8G. You will see less non-Quattron as half of the fab is being converted for Apple supply.

As per my post below from another thread, it is actually Terry Guo buying the 10G plant. I wouldn't be surprised if Apple TV turns out to be huge size. Apple had "huge size" LCD monitors.

The irony lost here is that CMI is itself in financial trouble but Guo did not bail it out with direct investment, but CMI doing rights issue instead.



Not sure about this. Apple was forced to ask its nemesis Microsoft to invest 10% into the company before it runs out of cash, and Microsoft pulling out Office. It speaks little of its potential, but certainly volumes on its past strategy and financial management.

PS interesting note by Barclays on 10G profitability. Not very profitable, even after the massive writedowns and reduced depreciation, but at least positive PnL:
P/L
(JPY mn) 3/2010 3/2011
Sales 86,923 266,261
Cost of goods sold 78,036 248,867
Gross profit 8,887 17,393
SG&A expense 2,130 6,119
Operating profits 6,756 11,274
Nonoperating income/expenditure -160 702
Recurring profit 6,595 11,977
Pretax profit 6,595 11,977
Taxes 4 4
Income taxes-deferred 2,684 4,875
Net profits 3,907 7,097

"we believe the sales price for Sharp’s 10G panel production plant was around book value (at around JPY66.0bn, see Figure 1), meaning there is little risk of an impairment loss (Our BPS for 13/3E is JPY593.7)" -Barclays

Interesting. This should be good for them

^^ that makes sense but a kink is that it is Terry Guo who bought into 10G. He probably not so keen to have 1/2 of the capacity allocated to him

My guess is he is passive and likely position for Apple TV. The LCD IP lies in Sharp parent itself.

All of this is quite amazing to me. It is unbelievable the amount of money that is being bled by panel mfg's.

As stated in another thread I have been been kicking tires and my bonus will be here next month. I want a LARGE display and Sony is my favorite mfg despite the way things are panning out.

I am concerned somthing might happen with Sharp and perhaps they abandon the Elite line who knows. The Sony 65 sounds in jeopardy.

One of those two sets will be purchased but I think I will move forward with the 70 Elite next month and this should keep me covered until OLED comes out in similar sizes down the road.

Ugh things seem to be getting worse at a more rapid rate then I thought.

I would feel worse over Sony leaving the landscape than Pioneer. I have had great sets from them including my current 55XBR8 over my 20 plus years of buying tv's. It would suck...

Rick

We shouldn't be surprise if Sharp is the only Japanese TV manufacturer left by end of this decade. But the Japanese still own tons of IP.

Come to think of it... Foxconn is the EMS for Sharp and Sony. Most likely the deal will allow Foxconn to be a bridge for Sharp's panels to Sony and others. But like I said, Terry is unlikely to take 50% of 10G capacity as Foxconn doesn't have brand TV business (ie it will not be principal)

"Foxconn is planning to make 9.5M LCD TVs in 2012, including 8M for Sony and 1.5M for Sharp. Foxconn acquired Sony’s global LCD TV assembly lines a few years ago and provides manufacturing for Sony. With Sharp’s panel capacity and technologies, Foxconn will certainly expand its OEM business." -DisplaySearch

no, use your bonus to buy one of lgs oled sets and be a guinea pig for the rest of us.

Too late sorry- I ordered the 70 Elite yesterday.

When Sony (and much less - Panasonic) will abandon TV-sets business, that would be their suicide decision! All their success of now profitable divisions (PSs , PCs ,photo-video cams etc.) is based on their public perception ( completely justifiable!) as best TVs producing company. If they can't compete in that their main area , they gonna end up as miserably as Sanyo, Motorola or Kodak... IMHO

Coincidentally more bad news from Sony and Sharp:

April 10 (Bloomberg) -- Sony Corp. and Sharp Corp. posted a combined 900 billion yen ($11 billion) loss as deteriorating market conditions forced Japan’s two largest LCD television
makers to abandon forecasts made just two months ago. Shares traded in Germany plummeted.
Sony had a record loss of 520 billion yen for the year ended March 31, more than twice what it had predicted in February, after taking a charge to write down deferred tax
assets. Sharp also had a record loss of 380 billion yen, 31 percent more than its earlier forecast.
The two companies, once symbols of Japan’s dominance in electronics, have been hammered by Apple Inc. and Samsung Electronics Co., a strong yen and the aftermath of last year’s quake and Thai floods. Sony’s new President, Kazuo Hirai, may have to raise equity and cut jobs while Sharp has turned toTaiwan’s Foxconn Technology Group for an infusion of cash.
“The situation is critical and we will carry out drastic reform. Nothing is sacred.” Sony’s Chief Financial Officer Masaru Kato said today in Tokyo. “Turning around our TV business is a top priority.”
Sony’s shares in Germany plunged as much as 9 percent, the most in more than three years. Sharp’s shares fell 7 percent in Frankfurt.

Tax Charge

Sony took a 300 billion yen charge to write down the value of deferred tax assets as the company no longer expects to be as profitable as it had once forecast. The company may raise financing with equity, according to Kato. It has not made any specific plans to do so, he said.
“Given the tax charges, Sony’s revival and growth plans in the U.S. don’t seem to be working out,” said Satoshi Yuzaki, a general manager at Takagi Securities in Tokyo. “The market is very skeptical about the outlook for the company over the next three to five years.”
The loss underscores the challenge for Hirai, 51, in turning around the company that set the trend in electronics during the 1980s with products like the Walkman music player.
Hirai, who succeeded Howard Stringer this month, has said he will close down less-competitive businesses and cut costs to revive Sony. The company predicted operating profit of 180
billion yen for the fiscal year that began this month.

Job Cuts

The company will cut jobs at its television unit, according to a person familiar with the situation. Sony may eliminate as many as 10,000 positions, according to the Nikkei newspaper. Sony will give a briefing on its turnaround plan on April 12, Kato said, declining to elaborate on the number of job cuts.
Sony’s loss is the worst since the company was founded, according to Mami Imada, a spokeswoman. Including today’s announcement of the 520 billion-yen loss, Sony lost a combined 919.32 billion yen in the past four years, according to data compiled by Bloomberg.
“It’s only been two months since Sony cut forecasts last time,” said Nobuo Kurahashi, an analyst at Mizuho Financial Group Inc. in Tokyo “Given the general trend that orders and
sales improved this past quarter, it’s unclear what could have changed so dramatically. Overall, the impression of today’s announcement is very bad.”
Hirai is scheduled to outline his turnaround plan on April 12. Sony, worth more than $125 billion in 2000, is now valued at $20 billion, compared with $591 billion for Cupertino,
California-based Apple and $170 billion for Suwon, South Korea-based Samsung.
The new CEO, who’s been credited with making the PlayStation game business profitable, is bringing in a new team and has put himself in charge of Sony’s TV business, which is
forecast to lose money for an eighth consecutive year.
Hirai has already taken action in an effort to boost the TV business. Last year, Sony exited a panel-making venture with Samsung, saying the sale of that stake to the South Korean
company will save about 50 billion yen in costs for Sony’s TV operation.
Sharp also posted the worst loss since the company was founded a century ago. The company has cut production of TV panels at its two biggest LCD plants as demand has failed to meet supply. The company’s so-called 10th-generation factory in Sakai, has a production capacity of 72,000 panels a month, while the eighth-generation LCD plant in Kameyama, Mie, is capable of making 100,000 panels.
“Our previous forecast was too optimistic,” Tetsuo Onishi, an executive managing officer said in a press conference in Osaka. “Sales are still bad.”

Just what was to be expected after they put Foxconn in their Chicken Coop!


FOXCONN TAKES CONTROL OVER SHARP'S 10G PLANT

http://www.flatpanelshd.com/news.php...&id=1334043037

"Nikkei reports that Sharp has decided to sell more than 7 % of their remaining share in their 10G (10th generation) display plant to Toppan Printing Co. and Dai Nippon Printing Co., respectively. That leaves Sharp with a less than 40 % share in the world's most advanced display manufacturing plant, and means that Foxconn is now effectively taking control with their 46 % share."

we may have 2 fewer display manufacturers soon. i would think panny is next unless their reliance on plasmas somehow gives them some sort of advantage.

The way I see it is that Sharp simply ran out of cash. It doesn't matter if they have the best equipment but no working capital to produce widgets. They are also a major solar player.

And like I said, someone did their maths very wrong. LTCM or Barings would have been heroes if they could hold their positions for another 6 months. Time is not on Sharp's side.

Why so negative about Sharp? Remember when Sony sold their stake in S-LCD moments before they announced C-LED? One thing I admire about the Japanese is their skill at keeping secrets, as no one saw C-LED coming. Additionally, it is a mystery how Sony is building these C-LED screens.

Since LCDs are now a commodity, Sharp could be moving to something else. Let's wait and see.

You are still too optimistic: Japan's Sony Corp flagged a record $6.4 billion annual net loss, double an earlier forecast and a fourth straight year of red ink, as it writes off deferred tax credits, heaping more pressure on its new CEO to turn around the electronics giant. Sony, which plans to axe 10,000 jobs - around 6 percent of its global workforce - according to media reports this week, has been hammered by weak demand for its televisions and overtaken by more innovative gadget rivals such as Apple Inc and Samsung Electronics.

I saw it coming... with my own two eyes two years ago!

http://www.avsforum.com/avs-vb/showp...2&postcount=11

One thing is clear enough. Whomever is perceived to have the high end, videophile-quality product line will struggle. First Pioneer/Elite, now Sharp/Elite, and Sony has been charging price premiums and still not making money for about a decade.

That leaves Samsung standing at the top. Perhaps they will end up as the only survivor if this grim marketplace continues for a few more years.

It's never a good thing for the consumer when one supplier effectively owns the market.

When OLEd (or/and CLEd) takes over Samsung will be the one who loses the most money so right now, dispite what one might think, they are in a uncomfortable situation.
http://www.cnbc.com/id/46378049/Sams...r_LCD_Business

With the financial situations being what they are and the apparent emergence of OLED how do you see the market place shaking out? What will happen to Panasonics plasma world? Will all the majors be forced to sell OLED to make a profit?