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Trading house Itochu Corp. said Friday its group net profit in the first half of the 2002 business year dropped 11.8 percent from a year earlier to 22.24 billion yen due to the slump in the domestic IT sector.

The Osaka-based firm said group sales for the six-month period that ended Sept. 30 declined 13.9 percent from a year ago to 5.07 trillion yen.

The revenue fall was partly blamed on the transfer of its steel operations to affiliate Marubeni-Itochu Steel Inc.

All divisions, ranging from textile to financial services, showed a decline in revenues from the same period last year, with the exception of food operations. Officials attributed the growth in the food division to increased trading volume of food items for convenience stores and animal feeds.

The group operating profit posted a 8.2 percent decline to 46.41 billion yen.

In addition to the food division, the industrial machinery, general merchandise and financial service sectors posted year-on-year growth in operating profit, thanks to a decrease in loan-loss provisions and a brisk U.S. housing market.

The firm stuck to its initial earnings outlook for the full year to March, with a group net profit of 50 billion yen on revenue of 11 trillion yen.

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