Japan Inc.'s earnings seen growing despite tax hike, firmer yen
TOKYO -- Many Japanese companies logged sharp profit growth in the year ended March 31, and expect profits to edge higher this year as well despite the consumption tax hike and a stronger yen.
By Friday, earnings had been released by companies representing 70% of total market capitalization among those with March book-closings, excluding financial firms and utilities.
Last fiscal year, the aggregate pretax profit of companies in this group climbed 41%. The profit growth for all companies, accounting for those that have yet to release results, is expected to reach 34%. Combined profit is seen at 94% of the record reached in fiscal 2007.
Manufacturers' profit is seen rising 49%, with automotive and electric machinery makers performing notably well. On the other hand, nonmanufacturers' profit is seen up a more modest 18%.
In the current fiscal year ending March 2015, combined pretax profit of the companies that have announced earnings will likely rise 2%. The profit for all companies is also seen edging up.
Despite concerns over the fallout from the sales tax hike and slowdowns in emerging economies, many companies will likely keep profits on an upward arc thanks to lean operations and competitive products and services.