Pioneer Posts 39.6% Operating Profit Decline Q3 Despite 8% Sales Increase

Pioneer’s operating profit declined 39.6 percent for Q3 ended Dec. 31 to $14.5 million ($1 = 115 yen) despite an 8 percent sales increase to $1.19 billion, the company said Monday. Pioneer blamed the profit decrease on higher selling, general and administrative expenses and a “deterioration in the cost of sales ratio,” resulting mainly from the negative effects of the weaker yen. Car electronics sales grew 7.1 percent in Q3 to $803 million despite a decline in car navigation system sales, Pioneer said. Although aftermarket sales of car navigation products rose in North America and Europe, a shift to lower-priced models led to a decline in the Japanese market, resulting in the overall decline, it said. OEM car navigation sales declined in Japan, but rose in China and North America, resulting in an overall OEM car navigation sales increase. Overall car audio product sales rose, Pioneer said. Aftermarket car audio sales declined in Europe but grew in other areas, particularly the Middle East and Central and South America, and resulted in a net aftermarket car audio sales increase. OEM car audio sales declined in China but rose in North America and Southeast Asia, for a net OEM car audio category increase. Total OEM sales accounted for 56 percent of total car electronics sales, vs. 54 percent a year earlier. Home electronics sales grew 12.6 percent $298.1 million, mainly on higher sales of optical drive-based cable set-top boxes. For its fiscal year ending March 31, Pioneer left unchanged its November forecast for a 3.4 percent sales increase and an 11.9 percent increase in its operating profit from a year earlier. The forecasts assume Pioneer will post a sales increase in aftermarket car audio products “through introduction of new products in emerging markets and North America,” the company said.