sony ppt
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sony corporationTRANSCRIPT
Business News Analysis
Sony Corporation
Presented by-Neha UpadhyaySubhash ReddySatheesh Kumar
NEWS
• Sony Suffers $5.7-bn Loss, Sees Turnaround – Economic Times (11th May)
• Sony posts a record loss, vows 2012 profit – aggressive cost-cutting and top-to-bottom reorganization.
- Los Angeles Times (10th May)
SONY
Key People
Sir Howard Stringer (Chairman)
Kazuo Hirai (President & CEO)
Ryōji Chūbachi (Vice Chairman)
Products
Electronics,
video games,
mass media,
broadcasting and cable,
music and entertainment
telecommunication,
digital distribution
Products
Services Financial services,
insurance,
banking,
credit finance &
advertising agency.
Current Status
Total sales drop – 9.6 %
Loss - $ 5.6 bn
Previous year loss - $ 3.2 bn
Sales drop in LCD, DG cam, PC & gaming
products – 18.5 % which makes half of
sony’s revenue
Current Status
Music business plunged to $ 5.4 bn from $
5.7 bn.
Operating profit reduced to $ 450 million
from $475 million.
Share price as on were 10th may ¥1203
yen touching 25 year low price.
SONY’s StrategyKazuo Hirai, Sony's new chief executive, has
promised to make "unavoidable, painful
choices" to fix or dispose of poorly performing
divisions telling "Sony will change.“ to
investors.
Cost cutting &
Restructuring
Cost Cutting
Restructuring
Act of reorganizing the
• Legal,
• Ownership,
• Operational, or
• Other structures of a company for the
purpose of making it more profitable.
Steps Of Restructuring
1. enough liquidity to operate during
implementation
2. produce accurate working capital forecasts
3. provide open and clear lines of
communication with creditors
4. update detailed business plan and
considerations
Characteristics of restructuring
• Cash management and cash generation
during crisis
• Retention of corporate management
sometimes "stay bonus" payments or
equity grants
Characteristics of restructuring
• Moving of operations such as manufacturing to
lower-cost locations
• Reorganization of functions such as sales,
marketing, and distribution
• Renegotiation of labor contracts to
reduce overhead
• Refinancing of corporate debt to reduce interest
payments
Characteristics of restructuring
• Sale of underutilized assets,
• Outsourcing of operations such as payroll and
technical support
• A major public relations campaign to reposition the
company with consumers
• Improving the efficiency and productivity through new
investments, R&D and business engineering.
Restructuring In Sony
• Sony to sell its full stake in LCD join
venture with Samsung Electronics worth
$940 million.
• Sony to outsource LCD panel.
• Sony acquired Ericsson's stake in Sony
Ericsson in January 2012
Analysis• For the last three years, Sony has lost
399.3 billion yen ($5.1 billion) due to competition.
• In September 2000 Sony had a market capitalization of $100 billion; but by December 2011 it had plunged to $18 billion.
• In May 2012, Sony shares are valued at about $15 billion i.e. just 3 percent of rival Apple Inc.