Construction firm Tobishima Corp. said Wednesday its group net balance returned to the black in fiscal 2000, mainly due to sales of securities holdings.
During the year to March 31, net profit came to 295 million yen, a turnaround from the previous business year’s loss of 22.10 billion yen.
Tobishima, known for its expertise in large-sale civil engineering works, posted a 25.6 percent rise in consolidated pretax profit to 6.03 billion yen on a 2.3 percent increase in sales to 323 billion yen.
But the increase was mainly due to the sale of securities holdings with latent capital gains.
The firm’s mainline construction business, however, remains under strong downward pressure, Tobishima said.
Its financial statements also demonstrate that the main factor improving Tobishima’s net balance was the lack of need for it to report latent losses on its securities and real estate holdings, whose market values had plummeted below their book values.
In fiscal 1999, Tobishima’s net balance had taken triple blows from huge loan-loss provisions, and the reporting of latent losses on its securities and real estate holdings. Those costs had driven up its net loss to 22.1 billion yen.
Looking ahead, it forecasts its group net profit at 100 million yen and pretax profits at 5.8 billion yen on projected sales of 315 billion yen.
“The harsh business environment will remain in place because demand for condominium construction has subsided,” the company said in a statement. “And because we cannot expect the value of public works projects to increase.”
On a parent-only basis, Tobishima’s net profit swung back to the black at 206 million yen, an upswing from the previous period’s loss of 22.82 billion yen. Pretax profit jumped 24.2 percent to 6.04 billion yen on sales of 305.55 billion yen.
The company said it will again not pay a dividend for fiscal 2000.
Also on Wednesday, midsize general construction contractor Maeda Corp. said it chalked up a group net profit of 1.22 billion yen for fiscal 2000, turning around the previous year’s net loss of 5.63 billion yen on cost-cutting and restructuring efforts.
The Tokyo-based company said its unconsolidated pretax profit soared 24 percent to 13.2 billion yen, although its group sales fell 3.2 percent to 464.34 billion yen.
Construction revenues fell 2 percent to 416.1 billion yen, and nonconstruction revenue fell 12.6 percent to 48.2 billion yen.
On a parent-only basis, Maeda netted profit of 2.06 billion yen, compared with a net loss of 5.96 billion yen, and pretax profit of 11.62 billion yen, up 22.8 percent, on sales of 409.15 billion yen, down 1.6 percent.
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