The nation’s major nonfinancial companies are expected to suffer a 1.4 percent drop in group pretax profits for the current business year ending March 31, 2002, after posting a hefty 33.5 percent rise in 2000, Nomura Securities Co. said in a report released Tuesday.
The group revenues of 345 companies are projected to grow 3.1 percent in 2001, compared with a gain of 5.2 percent the previous year, Nomura’s Financial Research Center said.
Japan’s top brokerage house said a slowing U.S. economy is dealing a severe a blow to the Japanese economy, pushing most domestic companies into an adjustment phase during 2001. Falling semiconductor prices since autumn 2000, coupled with reduced demand for mobile phones, are also behind the estimated drop in profits, Nomura said.
Of the 345 companies, 224 in the manufacturing sector are expected to post a 3.9 percent drop in group pretax profits, while 121 in the nonmanufacturing sector will likely report a 3.4 percent gain.
By industry, firms in the food, retail, pharmaceutical and health care, and housing and real estate sectors are expected to perform well.
Automakers in particular will probably post a strong 18 percent gain in pretax profits, thanks mainly to the yen’s weakness, brisk domestic car sales and an aggressive restructuring drive.
By contrast, companies in the electric and precision machinery sectors are expected to fare poorly, with pretax profits projected to fall 23 percent. For 2002, the 345 firms will likely be on the path to recovery, with group pretax profits surging 15.6 percent, Nomura said.
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