Major Japanese companies double earnings

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TOKYO: Major Japanese firms wrapped up the latest earnings season on a high note, more than doubling their net profit in the three months to June, a new report showed on Monday.

Brokerage SMBC Nikko Securities said that its review of company financial results showed combined net profits surged about 112 percent from the April to June quarter a year earlier, while operating profit jumped 33 percent among some of Japan Inc.’s biggest names. A pick-up in consumer spending and a sharp decline in the yen, which makes exporters such as Toyota and Sony more competitive overseas, were behind the boost in profits, the company said.

“The profit gains were mainly due to a positive effect of the weak yen,” said SMBC Nikko Securities analyst Kayoko Ota. “Recovering domestic demand and steady growth in North America were also major factors,” the analyst said.

Ota also said the good times were likely to last with many firms upping their fiscal full year to March profit and sales forecasts. “They’re expected to stay on course to recovery,” she added.

The SMBC report, which looked at nearly 500 companies on Tokyo’s broad-based Topix index, found that manufacturers saw the biggest rises in profit. Toyota’s earnings almost doubled to a record $5.64 billion in the quarter, with the firm on track to produce over 10 million vehicles worldwide this year, it said.

AFP

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