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Sumitomo Corp. said it expects an annual loss of ¥85 billion ($711 million), more than four times the number forecast by analysts, after the trading house posted additional write-downs on its resources investments.

The drop in energy and commodity prices means Sumitomo will need to write down ¥325 billion in asset values from major projects, up from the ¥240 billion in impairments the company expected in September, the Tokyo-based trader said in a statement.

For the fiscal year ending in March 2016, Sumitomo said it expects profits to recover to ¥230 billion as it embarks on a three-year strategy that will include boosting investments in the period to ¥1.2 trillion and paying greater attention to risk management.

Although it is the least reliant on energy and commodities among Japan’s trading houses, Sumitomo’s original net income target of ¥250 billion for this year, given in May 2014, was largely wiped out by asset impairments on its raw materials investments.

Sumitomo’s loss for the year ending in March was earlier forecast at ¥19 billion, according to the mean of 11 analyst estimates compiled by Bloomberg. A loss at the level announced Wednesday would be the worst since 1997 for Sumitomo, which will report its annual results in May.

In February, Sumitomo warned that its original write-down figure of ¥240 billion may grow, with its North Sea oil, U.S. shale and Brazilian iron ore businesses vulnerable. Other Japanese traders have also recorded write-downs this year, although Sumitomo’s are the largest.

The additional write-downs announced on Wednesday include a ¥30 billion charge on U.S. oil and ¥15 billion on Brazilian iron ore. The charge on its tight-oil project with Devon Energy Corp. takes the total impairment Sumitomo expects to post on the project to ¥203.6 billion, or close to the trading company’s annual profit of ¥223.1 billion for the whole of last year.

Sumitomo pared earlier gains of as much as 1.8 percent to close up 1.4 percent at ¥1,379.5 on the Tokyo Stock Exchange.

Under its previous two-year strategy, announced in May 2013, Sumitomo said it would sell ¥770 billion of assets and make ¥750 billion in new investments, with a view to bolstering its balance sheet and shifting focus from mining and energy into areas such as lifestyle and media businesses.

Japanese trade houses typically seek to profit by churning equity investments in projects or companies, as well as via trading physical commodities and energy products.

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