Panasonic Corp reported a worse-than-expected 5.6 percent fall in October-December profit despite help from a Japanese government incentive scheme and its buyout of subsidiary Sanyo Electric.

Investors are eyeing Panasonic's ability to restructure quickly and show benefits after its deal with Sanyo Electric, which is aimed at sharpening the company's focus on environmental technologies such as solar power systems and rechargeable batteries.

Panasonic reported an operating profit of 95.36 billion yen ($1.17 billion) for October-December, lagging an average forecast of 109.1 billion yen from a poll of six analysts by Thomson Reuters I/B/E/S.

The maker of Viera TVs and Lumix cameras left its full-year operating profit outlook at 310 billion yen, compared with a consensus of 328 billion yen in a poll of 20 analysts. Operating profit for the year to March 2010 was 190 billion yen.

Panasonic shares rose 0.1 percent ahead of the announcement, underperforming a 1.8 percent gain in the Nikkei average.

($1=81.34 Yen)

(Reporting by Isabel Reynolds; Editing by Vinu Pilakkott and Edmund Klamann)