Sony reports $3bn loss after hacking and Japan earthquake woes

Firm hoping to bounce back after torrid 12 months

Sony has posted a net loss of $3.1bn for the financial year ending 31 March 2011, after having to write off billions in tax credits and deal with the after-effects of the earthquake in Japan and a major hacking attack on its network.

The company said that the main reason for the poor financial performance was having to write off $4.4bn in tax credits, leading to a loss for the third successive financial year.

The disaster in Japan did not have a major impact on profits, but did heavily disrupt the manufacturing and delivery of goods in Sony's supply chain. Production at 10 manufacturing sites was suspended after damage caused by the earthquake, the firm said.

Sony is estimated to have lost $61m in sales due to the earthquake, and to have spent another $143m on idle facility and insurance costs.

On a more positive note, operating profit was up by over 500 per cent to $2.4bn. The firm's Consumer Professional and Devices (CPD) and Network Products Service (NPS) divisions were also profitable, despite sales decreasing by 0.5 per cent year on year to $86.5m.

The CPD division, which sells televisions, digital imaging, audio and video products, semiconductors, components and business services, recorded a profit of $35.4m, up 1.6 per cent year on year.

Meanwhile, the NPS division, which sells laptops and PlayStation consoles, saw a rise of 0.4 per cent in profit to $435.4m.

Despite the mixed results, Sony retained a positive outlook for 2011. A profit of $976m has been forecast for the current year, and the company is looking to cut costs to increase profit.

Sales in the CPD and NPS divisions are expected to increase this year, Sony said.

However, the fallout from the hacking of Sony's PlayStation Network has yet to be accounted for, and is expected to cost between $100m and $200m in security protection, user support, cost discounts and legal bills.