Sony today reported widening losses for Q4, blaming reduced sales of its last-generation PS2 games console and costs associated with the launch of the PS3.

The electronics and games industry giant booked operating losses of 113.4 billion yen (£475m) for January-March, compared with a loss of 51.9 billion yen (£217m) for the previous Q4.

The annual operating profit for the year ending 31 March was 71.75 billion yen (£300m). Revenue was up just over 10 per cent at 8.3 trillion yen (£34.7bn). Joint venture phone maker Sony-Ericsson performed well.

The firm issued a bullish forecast for the coming year, predicting operating profits of 440 billion yen (£1.84bn). Sony expects to reduce the cost of manufacturing PS3s, and to make LCD televisions more cheaply. The forecast also included 59 billion yen (£247m) to be gained from sales of land, which could account for it being higher than analysts' predictions. ®