Announcement of Financial Results: Panasonic Reports Third-Quarter and Nine-Month Results

-Increased Business Restructuring Expenses Cause Net Loss;
Annual Forecast Revised Downward-

OSAKA, Japan — (BUSINESS WIRE) — February 3, 2012 — Panasonic Corporation (NYSE: PC)(TOKYO:6752)("Panasonic") today reported its consolidated financial results for the third quarter and nine months ended December 31, 2011, of the current fiscal year ending March 31, 2012 (fiscal 2012).

Consolidated Third-quarter Results

Consolidated group sales for the third quarter decreased by 14% to 1,960.2 billion yen from 2,285.5 billion yen, compared with the same period a year ago. Of the consolidated group total, domestic sales amounted to 1,043.8 billion yen, down by 13% from 1,200.6 billion yen and overseas sales decreased to 916.4 billion yen, down by 16% from 1,084.9 billion yen.

Sales in the Japanese consumer electronics industry declined from the last fiscal year when there was rush demand as a result of the Japanese government's 'eco-point' stimulus package. Although there were signs of recovery with the normalization of the supply chain, which had been disrupted by the Great East Japan Earthquake, the Japanese economy as a whole was still severely affected by the shortage in electricity distribution after the disaster, the global economic slowdown, appreciation of the yen, and declining stock prices.

In the meantime, the global economy continued to slow down caused by the flooding in Thailand and the destabilization of the European finance market due to the government debt crisis, despite demand expansion in emerging markets including China.

In such a business environment, Panasonic has been working towards two themes, Paradigm Shift to Growth and Laying Foundations to be a Green Innovation Company, in the second year of its three-year midterm management plan called "Green Transformation 2012 (GT12)." This is the first step towards the 100^th anniversary vision of becoming the "No.1 Green Innovation Company in the Electronics Industry."

Although the company pursued a streamlining program to reduce material and fixed costs, operating loss¹ was 8.1 billion yen, compared with a profit of 95.3 billion yen a year ago. Pre-tax loss was 191.2 billion yen, compared with a profit of 82.7 billion yen a year ago. Net loss attributable to Panasonic Corporation amounted to 197.6 billion yen, compared with a profit of 40.0 billion yen a year ago.

¹ For information about operating profit (loss), see Note 2 of the Notes to consolidated financial statements.

Consolidated Nine-month Results

Consolidated group sales for nine months ended December 31, 2011 decreased by 10% to 5,965.4 billion yen, compared with 6,653.4 billion yen in the same period of fiscal 2011. Domestic sales amounted to 3,080.2 billion yen, down by 9% from 3,390.1 billion yen a year ago, while overseas sales decreased by 12% to 2,885.2 billion yen, down from 3,263.3 billion yen a year ago.

The company's operating profit for the nine months decreased to 39.5 billion yen, from 264.3 billion yen a year ago, due mainly to sales decline caused by the Great East Japan Earthquake and the flooding in Thailand. Price decline and appreciation of the yen also caused a decrease in profit. Pre-tax loss totaled 350.5 billion yen, compared with a pre-tax income of 227.3 billion yen a year ago, due mainly to the business restructuring expenses such as the implementation of early retirement programs and the impairment losses of fixed assets. Net income attributable to Panasonic Corporation turned to a loss of 333.8 billion yen from an income of 114.7 billion yen a year ago by incurring an adjustment to deferred tax assets and liabilities for changes in Japanese corporate tax rates as a provision for income taxes.

Consolidated Nine-month Breakdown by Business Segment

The company's nine-month consolidated sales and segment profit by business segment, compared with the amounts a year ago, are summarized as follows:

Digital AVC Networks

Sales decreased by 16% to 2,182.9 billion yen from 2,585.4 billion yen a year ago. Despite favorable sales of PCs, this result was due mainly to sales decline in flat-panel TVs and mobile phones. Segment loss amounted to 32.7 billion yen, compared with segment profit of 101.2 billion yen a year ago, due mainly to sales decrease and price decline.

Home Appliances

Sales increased by 1% to 979.2 billion yen, compared with 974.2 billion yen a year ago, due mainly to stable sales in air conditioners, washing machines and refrigerators. Segment profit was 78.6 billion yen, compared with 81.9 billion yen a year ago, due mainly to rising prices for raw materials.

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