Computer maker Fujitsu yesterday said it returned to profitability in the first half to September as a result of costcutting efforts and brisk sales of hard disk drives.
It was the first time in five years that the company has posted a net profit in the first semester. Despite the improved earnings result, Fujitsu, which has its European headquarters on Birmingham Business Park, said it was maintaining its full-year profit forecast.
For the half to September the PC firm posted net profit of 7.67 billion yen (£3.7 million), reversing a year-ago loss of 8.16 billion yen (£3.96 billion).
The turnaround came despite a 1.2 per cent drop in revenue to 2.19 trillion yen ( £ 10 . 6 billion) from
2.22 trillion yen (£10.7 billion) a year ago. Operating profit grew to 47.57 billion yen (£23.1 million) from a profit of 33 . 28 billion yen (£16.1 million) a year earlier.
"Our past cost- cutting efforts have started to bear fruit," said Masamichi Ogura, chief financial officer at Fujitsu.
"As a whole we are now on a recovery track," he said.
As evidence of the benefit of cost cutting, Fujitsu said the ratio of production costs to sales dropped slightly to 73.3 per cent in the first half from
73.6 per cent a year earlier. In addition, the ratio of sales, general and administrative cost to sales declined to 24.5 per cent from 24.9 per cent a year ago.
Bottom- line profit was inflated by the booking of a special profit of 15.9 billion yen (£7.73 million) after the firm settled a lawsuit with its hard disc drive device vendors over defective parts.
In the first half, the driver of earnings was the system platform division, covering network products and servers.
"Sales of the UNIX servers were robust, mainly in the overseas market," Mr Ogura said.