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Mitsubishi Estate profit up 73% on home sales

Bloomberg

Mitsubishi Estate Co. said Wednesday its nine-month net income rose 73 percent as profit margins of its residential business improved.

Net income came to ¥58.5 billion for the nine months that ended Dec. 31 from ¥33.9 billion a year earlier, Japan’s biggest developer by market value said in a statement to the Tokyo Stock Exchange. Sales rose 10 percent to ¥720.3 billion.

Profit for its residential business gained 37 percent to ¥8.3 billion ahead of the April 1 consumption tax hike to 8 percent.

Mitsubishi Estate’s commercial development business more than doubled its profit after selling some assets, it said.

The company maintained its full-year profit forecast of ¥58 billion on sales of ¥1.07 trillion.

It halted sales of a residential project in Tokyo because of defects in the building, the developer said earlier this week. Mitsubishi Estate is seeking compensation from the builder, Kajima Corp., it said.

The halt will not affect its full-year earnings, Keisuke Tamaki, a deputy general manager of the developer’s corporate communications department, said at a news conference.

Mitsubishi Estate shares have declined 20 percent this year, compared with the 17 percent decline by the 45-member Topix Real Estate Index.