NSK projects fiscal year loss of ¥4 billion

NSK Ltd. (Japan) released guidance that it expects to report a net loss of ¥4 billion (USD $33.2 million) for the fiscal year ended March 31, 2003. Japan's largest bearing producer, NSK in September had originally forecast fiscal year profit of ¥4 billion ($33.2 million). In October 2002, after first half results came in lower than expected, the company revised its projections down to ¥1 billion ($8.3 million), helped along by strong automotive bearing demand in North America and Europe. However, NSK now says that even though sales will still show strongly, it suffered severe losses in its stock portfolio, wiping out its operating profit. NSK's ongoing restructuring effort is keeping operating earnings on track; the program is scheduled to continue through 2004. The Nikkei reacted strongly to NSK's third downward revision warning, rapidly pushing shares from ¥354 down to ¥319. It had been trading at ¥447 in late August 2002, before the spate of sales and earnings warnings. Those warnings triggered the slide in share prices, which then came around to impact the company a second time by hurting its portfolio value. For just that reason, some companies have been eliminating "early warning" sales and earnings projections.