Sony Ericsson Q3 Loss Narrows on Cost Cuts, Margin

• Sony Ericsson Q3 loss smaller than expected

• Cost cuts, better gross margin boost result

• More pessimistic on 2009 market contraction than Nokia

• Says has signed loan facilities of 455 mln euros

• Ericsson stock up 2.5 pct, outperforms bourse

Mobile phone maker Sony Ericsson posted a smaller than expected third-quarter pretax loss on Friday, boosted by big cost cuts, but said it expected the market to remain tough for the rest of the year.

The global handset market has been slammed by the recession and Sony Ericsson expects the market to have contracted around 10 percent by end-2009, an even more pessimistic view than the 7 percent forecast by market leader Nokia (NOK1V.HE). [ID:nLF596616]

Sony Ericsson, owned by Sweden's Ericsson (ERICb.ST) and Japan's Sony Corp (6758.T), reported a quarterly pretax loss of 199 million euros ($297 million), an improvement on the 283 million euro loss in the second quarter.

The mean forecast in a Reuters poll of 16 analysts had been for a 274 million euro loss.

"The reduced loss was due to better gross margin, as well as reduced operating expenses," Sony Ericsson said in a statement.

Sony Ericsson is in the process of cutting costs by 880 million euros, with the full effect due in late 2010.

The company's gross margin was 16 percent versus a forecast of 13.9 percent and 12 percent in the second quarter.

The result helped boost parent Ericsson's share price by 2.5 percent to 73 crowns at 0851 GMT, outperforming the wider Stockholm bourse.

"Expectations that they (Sony Ericsson) will make big losses next year have to be revised to show that they maybe won't make any money, but that at least they will break even," Martin Nilsson, analyst at Handelsbanken Capital Markets, said.

Sharp Sees Tight LCD Panel Supply Through Mid-2010

• China, other emerging markets driving demand - Sharp

• Comments follow startup of Sharp's flagship LCD plant

• Shares close up 0.2 pct, in line with broader market (Adds China demand, background)

The current industry shortage of LCD panels could continue through the middle of next year, the head of a unit at Japan's Sharp Corp (6753.T) said, in a potential move to shore up investor confidence in panel makers.

"Supplies have yet to catch up with demand at the moment and I expect things to remain that way until around the middle of next year," Hiroshi Saji, the president of Sharp Display Products Corp, told reporters on Friday.

Supplies have been tight due to brisk demand in emerging markets including China, he said.

Research firm DisplaySearch last month edged up its global LCD TV shipment forecast for 2009 by 2.4 percent to 130 million units, citing strong demand in key markets such as China and North America.

Saji was speaking after a ceremony marking the first panel shipment from Sharp's new LCD plant.

Sharp, the world's fourth-largest LCD TV maker behind Samsung Electronics Co Ltd (005930.KS), Sony Corp (6758.T) and LG Electronics Inc (066570.KS), earlier this month started production at its cutting-edge LCD panel factory in Sakai, western Japan.

The 430 billion yen ($4.7 billion) plant is capable of processing so-called 10th generation glass substrates, which are bigger than earlier generation substrates and help cut per panel production costs.

Sharp Display Products is now wholly owned by Sharp, but Sony plans to spend about 68 billion yen for a one-third stake in it to jointly operate the Sakai plant.

Following Saji's comments, shares in Sharp closed up 0.2 percent at 1,036 yen, in line with the Nikkei average .N225. (Reporting by Kentaro Hamada; Writing by Kiyoshi Takenaka; Editing by Edwina Gibbs)

DSM Engineering Plastics Recognized Leaders in Developing Green Consumer Electronics

DSM, a supplier of engineering plastics, has been recognized as a leading solutions provider that supports and enables the electronics industry to move away from chemicals that can lead to health and environmental problems.

In a new precedent setting research report "Greening Consumer Electronics: Moving Away from Bromine and Chlorine", the International Chemical Secretariat (ChemSec) and US based environmental organization Clean Production Action (CPA) identified seven companies who have engineered environmental solutions that negate the need for most - or in some cases all - uses of abominated and chlorinated chemicals. The seven companies include, amongst others, Apple, Sony Ericsson and DSM Engineering Plastics.

The report describes how the biggest brands in Electronics work closely with suppliers to develop new components that meet the necessary technical and safety performance specifications, as well as material restrictions on bromine and chlorine use. Subsequently, it mentions how DSM Engineering Plastics is among the first chemical companies to offer a complete portfolio of engineering plastics that are free of these substances: "The company produced a brand new generic polyamide (Stanyl ForTii) for connectors and sockets and a new thermoplastic copolyester (Arnitel XG) that can be used as a replacement for PVC- based wires and cables."

DSM Engineering Plastics worked together with suppliers to overcome manufacturing and design challenges that inhibited the replacement of BFRs and PVC. This has resulted in a portfolio of bromine- and chlorine-free products that enable producers of electrical and electronic equipment to continue to meet higher reliability, performance, and quality requirements.