Mitsubishi Corp Q1 net profit rises 17 percent

Japanese commodities trading giant Mitsubishi Corp said on Wednesday its first-quarter net profit grew 17 percent as higher coking coal prices boosted earnings. Mitsubishi, the biggest of Japan's clutch of influential trading houses by assets, said net profit for April-June was 117.8 billion yen ($1.06 billion), up from 100.8 billion yen in the same period a year earlier. Net profit at the company's coking coal unit in Australia jumped more than five-fold to 33.8 billion yen in the latest quarter, helping buoy profit at Mitsubishi's metals business to 50.7 billion yen - more than three times that booked a year earlier.
"Our first-quarter profit expanded thanks to stronger contribution from our coking coal unit, which was able to offset lower sales volume after Cyclone Debbie in Australia (thanks higher coal prices)," Chief Financial Officer Kazuyuki Masu told a news conference. The hefty gain offset a slump in Mitsubishi's energy segment, which booked a net loss of 2.8 billion yen due to a one-off charge of 18 billion yen on a planned sale of energy assets in North America.
The company declined to give detail of the deal, but CFO Masu said the transaction is expected to happen by the end of this year. Earnings from other businesses less sensitive to commodity market, like machinery, chemicals and food, were nearly flat from a year ago. For the full year through March, Mitsubishi maintained its forecast for net profit at 450 billion yen, up 2.2 percent from last year but below a mean estimate of 463 billion yen from nine analysts polled by Thomson Reuters I/B/E/S.
"We've got off to a good start this year," Masu said. He declined to give specific forecasts for coking coal prices for the rest of the year, but said the company's full-year guidance is based on an assumption that coking coal prices will fall to the levels before Cyclone Debbie disrupted distribution in major producer Australia in March.
Meanwhile Mitsubishi's smaller peer Marubeni Corp also reported a 11 percent climb in first-quarter net profit on Wednesday, citing higher prices of coal, iron ore and copper. The trading house kept its full-year net profit forecast unchanged at 170 billion yen.