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▼ Major Japanese Firms Expect Record Combined Profit in Fiscal 2017
- Category:Event
TOKYO - Major Japanese companies expect to set another record combined net profit for fiscal 2017 through next March following the previous year due to robust overseas demand and the yen's fall, data compiled by SMBC Nikko Securities Inc showed Friday.
Combined group net profit in the year to March 2018 is expected to rise 3.2% from the previous year, based on earnings data released by Thursday from 860 firms, or about 60% of all the companies listed on the Tokyo Stock Exchange's First Section that close their books in March.
In the fiscal year ended in March this year, group net profit rose 15.4% to a record high, as recovering resource prices more than offset the yen's strength.
Corporate Japan is set to see a record profit for the second consecutive year. Still, wage growth remains sluggish, leaving the question of whether solid business performances will help improve consumer spending and boost Japan's economic growth all together.
Companies' earnings projections for the current fiscal year are unlikely to show their combined net profit will drop, even after remaining results are all taken into account, SMBC Nikko Securities said.
The steel and electric industries are expected to post double-digit growth, given a pickup in demand for steel products and the weak yen.
In the year ended in March, the nonmanufacturing sector showed solid performance in particular with a 52.1% surge in net profit.
Profit in the wholesales industry, including trading houses, more than quadrupled on a rebound in resource prices, while the oil and coal product industry returned to profitability.
Net profit in the information and telecommunications industry jumped by 54.2%, with telecommunications and internet services giant SoftBank Group Corp. leading the industry by posting more than 1 trillion yen ($8.8 billion).
Profit in the manufacturing sector, however, fell by 0.9%, as the transportation equipment segment including the car industry posted a 12.9% drop, hurt by the strong yen in the first half of the year, even as the yen turned weaker after the U.S. presidential election last year.
Keiichi Ito, an analyst at SMBC Nikko Securities, said a record profit for the current business year is based on the premise of the weak yen.
"An unexpected yen rise will sting," he said.
Based on recalculation by SMBC Nikko Securities to reflect changes in accounting standards by some companies, Japanese companies last posted a record net profit in the year ended in March 2015 and saw a fall in net profit the following year.
© KYODO
Combined group net profit in the year to March 2018 is expected to rise 3.2% from the previous year, based on earnings data released by Thursday from 860 firms, or about 60% of all the companies listed on the Tokyo Stock Exchange's First Section that close their books in March.
In the fiscal year ended in March this year, group net profit rose 15.4% to a record high, as recovering resource prices more than offset the yen's strength.
Corporate Japan is set to see a record profit for the second consecutive year. Still, wage growth remains sluggish, leaving the question of whether solid business performances will help improve consumer spending and boost Japan's economic growth all together.
Companies' earnings projections for the current fiscal year are unlikely to show their combined net profit will drop, even after remaining results are all taken into account, SMBC Nikko Securities said.
The steel and electric industries are expected to post double-digit growth, given a pickup in demand for steel products and the weak yen.
In the year ended in March, the nonmanufacturing sector showed solid performance in particular with a 52.1% surge in net profit.
Profit in the wholesales industry, including trading houses, more than quadrupled on a rebound in resource prices, while the oil and coal product industry returned to profitability.
Net profit in the information and telecommunications industry jumped by 54.2%, with telecommunications and internet services giant SoftBank Group Corp. leading the industry by posting more than 1 trillion yen ($8.8 billion).
Profit in the manufacturing sector, however, fell by 0.9%, as the transportation equipment segment including the car industry posted a 12.9% drop, hurt by the strong yen in the first half of the year, even as the yen turned weaker after the U.S. presidential election last year.
Keiichi Ito, an analyst at SMBC Nikko Securities, said a record profit for the current business year is based on the premise of the weak yen.
"An unexpected yen rise will sting," he said.
Based on recalculation by SMBC Nikko Securities to reflect changes in accounting standards by some companies, Japanese companies last posted a record net profit in the year ended in March 2015 and saw a fall in net profit the following year.
© KYODO
- May 13, 2017
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