Source Pravda.Ru

Chinese TCL Corp. suffers net loss of US$85.5 million

Chinese television and mobile phone handset maker TCL Corp. on Wednesday reported a net loss of 692.2 million yuan (US$85.5 million; Ђ70 billion) in the first half of this year comparedwith a net profit a year earlier.

TCL cited costs earlier in the year of integrating with joint venture partners, France's Thomson SA and Alcatel SA, and a sharp decline in mobile phone sales as factors behind the turnaround from a net profit of 373.4 million yuan (US$46 million; Ђ38 million) in first-half 2004, the AP reminds.

The company said it expects to post a net loss in the third quarter of 2005.

TCL, based in the southern province of Guangdong, said the European and American operations of the TCL-Thomson joint venture reported a loss of 343.8 million yuan (US$42 million; Ђ34 million) in the first half, while the TCL-Alcatel joint venture saw a loss of 630.3 million yuan (US$78 million; Ђ63 million).

Sales at TCL's own-brand mobile phone unit fell 57 percent on-year to 1.91 million units, the company said.

Prices fell rapidly amid intense competition in the global consumer electronics industry, it said.

"The mobile phone sector has performed fairly badly of late, and TCL is another casualty," said Zhang Qi, an analyst at Haitong Securities.

TCL Multimedia Technology Holdings Ltd., a subsidiary with shares traded in Hong Kong, reported a first-half net loss of 96 million Hong Kong dollars (US$12.3 million; Ђ10 million), compared with a net profit of HK$381 million (US$48.8 million; Ђ40 million) in first-half 2004.

First-half revenue almost doubled to HK$15.6 billion (US$2 billion; Ђ1.6 billion), it said.

The company announced earlier this year that it has gained full ownership of its venture with Thomson after the French company exercised its option to swap its holding in the venture for a stake in TCL Multimedia.