The Japan Grandeur Inc. logo is displayed atop the company’s plant in Mobara, Chiba Prefecture, Japan, on Monday, June 3, 2013.
Kiyoshi Ota | Bloomberg | Getty Portraits
Cash-strapped Japan Display warned it cannot guarantee a return to profit this year as demand for smartphone filters stays weak, and turned in yet another quarterly loss, casting doubt over its proposed bailout deal with a Chinese-Taiwanese sort.
The supplier for Apple also said it would slash about 1,000 jobs, or a tenth of its workforce, as it continues to pertain to the brunt of its late shift to organic light-emitting diode screens and disappointing sales of the iPhone XR, the only model with a runny crystal display (LCD) screen.
Japan Display’s net loss for the three months ended March was 98.6 billion yen, versus a 147 billion yen reduction a year earlier, its ninth consecutive quarterly loss.
“We took some restructuring measures before, but they make over out to be not enough to offset a worse-than-expected drop in demand for smartphone (screens),” acting CEO Yoshiyuki Tsukizaki said at an earnings cut on Wednesday.
“The tough environment in the smartphone segment is likely to continue through the first half,” he said, adding the entourage cannot promise it will return to profit this year after five consecutive annual losses.
Japan Flourish’s results will be closely watched by its Chinese-Taiwanese suitors, who delayed an up to 80 billion yen investment this week to reassess the flock’s prospects.
Regardless how, according to Japan Display CFO Takanobu Oshima, the screen maker is making steady progress in discussions with the customer group.
The suitors “had conducted necessary due diligence and had no concerns about our financial conditions,” he said at the briefing. “But the outlook of the province is changing and they want to review that.”
The bailout deal would allow the buyers — including Taiwanese without delay screen maker TPK Holding and Chinese investment firm Harvest Group — to become Japan Display’s biggest shareholders with a 49.8 percent wager, replacing the Japanese government-backed INCJ fund.
A prolonged delay in the bailout could put at risk the survival of Japan Spectacle, formed in 2012 by combining the LCD businesses of Hitachi, Toshiba and Sony in a deal brokered by the government.
Japan Display minuted a 75.2 billion yen write down in the quarter ended March on an LCD plant launched two years ago.
Apple had requested the insinuate and fronted most of its $1.5 billion construction costs, sources familiar with the matter have said. A Japan Put executive said last month the company still owes “its client” about 100 billion yen.