China's TCL Corp., the world's largest maker of televisions, sank further into the red in the first half of 2006 as losses deepened at its Hong Kong-listed TV and cellular arms.
TV maker TCL Multimedia Technology Holdings Ltd. posted a net loss of HK$1.6 billion ($205.7 million) for the first six months after making a provision of HK$865 million for a weak European business. That compared with a half-year loss of HK$95.6 million the previous year.
TCL Corp.'s other Hong Kong-listed unit, handset maker TCL communications Technology Holdings Ltd., posted a net loss of HK$70.65 million, although that narrowed dramatically from a loss of HK$853 million in the previous year.
TCL Multimedia, which had been among the first wave of Chinese firms to explore overseas markets, warned last month that its European operation had come under pressure from flat-panel TVs replacing traditional ones with cathode-ray tubes.
Shenzhen-listed parent TCL Corp., which reported a half-year net loss of 737.56 million yuan versus a loss of 692.61 million yuan a year ago, said it would intensify efforts to revamp the unit's European business but would not increase investment there.
EUROPE DRAGS
"Due to the firm's slow turnaround in Europe and changes in the region's market environment, TMT has not reached its expected goals in the European market. This has led to a further expansion of losses," TCL Corp. said in a statement.
However, while it said it expected to post a loss for the first three quarters of 2006, TCL predicted it would cut its operating loss by at least 50 percent in the third quarter as compared to a year earlier.
The TCL group has been working for more than a year to turn around money-losing assets bought from France's Thomson and Alcatel, the former making televisions and the latter cell phones.
Its own domestic mobile-phone business has struggled with fierce competition at home.
The parent firm, which has 56 percent of its sales overseas, saw its turnover fall 3 percent to 23.58 billion yuan.
For the second quarter alone, TCL Corp. posted a net loss of 607.24 million yuan versus a loss of 365.38 million yuan in the year-earlier quarter.
Source:佚名