Cash-strapped Sharp Corp is predicting a net income of 15 billion yen ($188 million) for the next business year, part of a plan to return to the profit it needs to win a bailout from its main banks, Kyodo news reported on Tuesday.
Sharp has to repay as much as 360 billion yen of short-term commercial paper loans and needs a credible plan to secure financing from lenders led by Mizuho Financial Group and Mitsubishi UFJ Financial Group.
Its banks, which would risk losing loans already extended to the TV maker if it failed to stabilize its finances, are expected to approve Sharp’s plan, although it is not yet clear if they will seek revisions.
The expected profit is however half of what Sharp was earlier aiming for, according to an earlier Kyodo report which said the panel and TV maker was targeting a net profit of about 30 billion yen, swinging from a loss of 250 billion yen projected for this year.
As part its efforts to restructure, Sharp is also in talks to sell a stake to fellow Apple Inc supplier Hon Hai Precision Industry Co.
It has denied a local report that it is in talks to make Intel Corp its biggest shareholder but sources have said it is in talks to supply panels for ultra-thin laptops that typically use processors made by Intel.
Citing sources familiar with the Japanese TV maker’s plan, which was submitted to creditor banks on Monday, Kyodo also said Sharp was expecting an operating profit of 121.2 billion yen for the next business year by cutting jobs, salary and bonuses.
That compares with an operating loss of 100 billion yen that Sharp has forecast for the current business year to next March.
The maker of Aquos TVs has already mortgaged nearly all of its domestic offices and factories, including one that makes screens for Apple latest iPhone, to secure fresh loans.
The company is also cutting 5,000 jobs, a tenth of its global workforce, and has asked workers to take a pay cut of as much as a tenth of their salary in a fresh bid to trim costs.
($1 = 77.8750 Japanese yen)