JVC has admitted that poor quality products and the failure of the Company to deliver the latest generation of LCD TV’s, contributed to the Company making a loss of A$767 million.
Consolidated total sales decreased 4% to A$9 Billion. In Australia JVC products are distributed by Hagemeyer. The Company claims that although camcorders and car electronics business continued to be stable, the Company struggled in the Consumer Electronics segment, because of a decline in sales of DVD equipment due to quality issues and the fact that the Company had old model LCD TV’s in the channel and were not quick enough in the development and production of new LCD TVs during the first half of the fiscal year.
Consumers in mass markets like the US turned away from JVC TV products this resulted in sluggish display sales in North America and declining audio sales.
Even Professional Electronics Components & Devices and Software & Media segments struggled in the market. Net income in this division for fiscal 2006 was likewise down year-on-year to a minus of 30.6 billion yen.
JVC claim that the 2005/2006 financial year was a decisive one for the audiovisual industry, marked by a shift in the pendulum toward digital products. Following the growth of DVD recorder sales in the previous fiscal year, the fiscal year ended March 2006 was marked by a reversal in the position of flat panel TVs and digital audio players, which replaced conventional products. They claim that Global demand rose in the IT and devices sectors and the three major product categories of PCs, mobile phones and semiconductors, as well as LCD TVs, boosted overall demand in the industry.
However JVC were unable to capitalise on this rise in demand with the company now bringing in new management.
Despite growth in sales of LCD TVs and camcorders combined with the performance of hit software products, sales of DVD equipment and Professional Electronics were down.
Growth in sales of LCD TVs, HD-ILA hybrid projection TVs and camcorders were not enough to make up for lower sales of CRT TVs, DVD equipment and audio products.
In the US market Americans are deserting JVC in droves with sales down by 12.1% year-on-year.
The Company also reported a rapid contraction in the market for Minidisc products triggered by the widespread adoption of digital audio players. The contraction JVC say outweighed sales in the growth digital audio products market.
?? Total sales in the Consumer Electronics segment were 600.3 billion yen during the fiscal year, down 4.3% year-on-year from 627.2 billion yen.