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Hitachi records first postwar loss

Slack sales of mainstay products and a stubbornly weak domestic economy led Japanese computer vendor Hitachi to post a net loss of 339 billion yen ($US2.8 billion) for its fiscal 1998, which ended on March 31.

The company blamed its poor performance on sluggish sales of semiconductors and displays as well as on the depressed state of Japan's economy. The loss was the largest in the company's history and its first loss since the end of World War II, according to a spokeswoman at the company.

Sales were down 5 per cent from fiscal 1997, falling from 8.42 trillion yen to 7.98 trillion yen.

Tokyo-based Hitachi is one of Japan's largest computer vendors, selling a range of mainframes, servers and PCs. The company is also a major producer of flat-panel displays and memory chips.

By product group, Hitachi's sales of information systems and electronics were slightly down compared to the previous year, falling to 3.11 trillion yen from 3.37 trillion yen. The product group was hurt by a sharp drop in prices of semiconductors and lower-than-expected sales of large-scale integrated circuits.

In fiscal 1998, the company invested 18 per cent less than the previous year, as its plant and equipment investment fell to 585 billion yen, the company said.

For the current fiscal year, which ends March 31, 2000, Hitachi will invest 12 billion yen to ramp up production of its large-sized LCD (liquid-crystal displays), according to a spokesman.

The company expects to return to the black by the end of the current fiscal year, and to post a 70 billion yen profit on Net sales of 8 trillion yen, Hitachi said.

The consolidated earnings report included Hitachi's Tokyo-based parent company and its 1010 subsidiaries worldwide.http://www.hitachi.com