(07/26/2006 3:47 PM EDT)

MANHASSET, N.Y. — For the first fiscal 2007 quarter ended June 30, 2006, Matsushita Electric Industrial Co. Ltd. posted group sales of $18.58 billion, up 4 percent from the same quarter a year ago.

First-quarter operating profit was $566 million, up 41 percent from $395.4 million in the same period a year ago. Pre-tax income also increased 14 percent to $656 million. Net income increased 7 percent to $312 million year-over-year.

Matsushita cited sales gains in digital audiovisual (AV) products. Of the consolidated group total, domestic Japan sales amounted to $9.23 billion, roughly flat with a year ago. Overseas sales increased 9 percent to $9.35 billion, reflecting strong sales in all regions, particularly in Europe from strong sales of flat panel TVs.

Audiovisual component network sales increased 4 percent to $7.63 billion, driven by a 14 percent increase in sales of video and audio equipment such as plasma TVs and digital cameras. Sales of components and devices increased 7 percent to $2.35 billion.

Although Matsushita expects continuing price declines the second quarter of fiscal 2007, the company has revised its sales target for the first half of fiscal 2007 to $37.3 billion, compared with $36.5 billion.

First half fiscal 2007 net income is now projected at $773.7 million, compared with the previous forecast of $601.8 million.