Mitsubishi Electric Corp. said Tuesday its group net profit dropped 38 percent in the year ended in March to ¥69.52 billion, due partly to expenses for refunds it paid for overcharging clients, including the Defense Ministry, on defense-related contracts.
The electrical machinery manufacturer also attributed the sluggish performance to slowing economic growth in China as well as the continued slump in Europe, which led to a decline in sales of its mainstay factory automation systems.
Mitsubishi Electric said it took ¥75.7 billion from nonoperating expenses to reimburse the victims of its overcharging. Group operating profit dropped 32.5 percent to ¥152.10 billion on sales of ¥3.57 trillion, down 2 percent.
It posted falls in sales and operating profit in the home appliance business, due chiefly to a large drop in demand for liquid crystal display televisions and Blu-ray Disc recorders for the Japanese market, though sales of its air conditioning products increased in Asia.
Meanwhile, the company said the earnings results were better than its estimates in February after the yen's recent depreciation pushed profit higher.
The company said it will pay a full-year dividend of ¥11 per share, compared with ¥12 a year ago.
Looking ahead, Mitsubishi Electric said it expects its group net profit in the current business year to grow 58.2 percent from fiscal 2012 to ¥110 billion on the solid U.S. economy as well as prospects of gradual growth in emerging countries.