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Sharp expects first profit in four years on Foxconn's cost cuts

Published 26/05/2017, 07:43
© Reuters. FILE PHOTO: A man using his mobile phone walks past Sharp Corp's liquid crystal display monitors showing the company's Aquos television in Tokyo

By Makiko Yamazaki

CHIBA (Reuters) - Japan's Sharp Corp said on Friday it expects to report its first net profit in four years in the year through March 2018 due in part to cost-cutting under the aegis of Taiwan's Hon Hai Precision Industry Co Ltd (Foxconn).

The liquid crystal display manufacturer forecast profit of 59 billion yen (411.6 million pounds), reversing a loss of 24.9 billion yen a year earlier.

The outlook compared with the 41.9 billion yen average of nine estimates from analysts surveyed by Thomson Reuters.

Sharp also released its first midterm business plan since Foxconn's $3.8 billion acquisition last year, targeting operating profit of 150 billion yen through the year ending March 2020.

With Foxconn having turned around the struggling panel maker, Sharp is now looking to invest in future growth drivers.

It teamed up with Foxconn to bid for the chip unit of Toshiba Corp, and last week said it would invest up to $1 billion in SoftBank Group Corp's technology-focused $100 billion Vision Fund.

© Reuters. FILE PHOTO: A man using his mobile phone walks past Sharp Corp's liquid crystal display monitors showing the company's Aquos television in Tokyo

Sharp also aims to apply to Tokyo's stock exchange to return to the first section of the bourse's trading board. Sharp was demoted to the second section in August after its shareholder equity turned negative.

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