Sharp Says Global Workforce Layoffs Not Necessarily Planned

sharp worldMarch 26, 2014 – Sharp Corporation of Japan has issued a press release stating that, despite recent reports from two Japan newspapers, the Nihon Keizai Shimbun (Nikkei) and Yomiuri Shimbun, it will not confirm that a global reduction of its workforce is planned. Last week, the Reuters news service, citing unnamed sources, also reported that Sharp would be reducing its global workforce by over 12 percent, which would be some 6,000 jobs, as part of a global restructuring program that’s expected to cost more than $1.7 billion. Of the 6,000 jobs to be cut, half were said to be in Japan through early retirement, and the rest would be overseas. In 2014, Sharp had some 50,000 employees. Sharp is set to report its third annual net loss in four years.

In a March 19th press release, however, Sharp says that while it’s currently considering various options, no specific decisions have been made at this time. Some options it’s considering to reduce costs include the already-announced voluntary salary cuts for Sharp directors and executive officers. Sharp is currently working on its new Medium-Term Management Plan, which is scheduled to be announced in around May 2015.

Earlier this month, The Wall Street Journal reported that Sharp President Kozo Takahashi had been seeking to meet with Sharp’s two main lenders in order to ask for additional financial support, less than three years after its last bailout. Takahashi is said to be presenting a turnaround plan to Sharp’s two main lenders, Mitsubishi UFJ Financial Group and Mizuho Financial Group. These two lenders together hold more than ¥400 billion ($3.3 billion U.S.) in Sharp debt. The plan may involve Sharp leaving businesses such as solar panels and seeking funds from other investors.

Sharp’s financial troubles have largely been due from its LCD-displays business – LCD displays that are typically used in TVs, smartphones, and tablets – while it’s printer/MFP/copier business has generally remained profitable over the last several years.

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