Hitachi Ltd. reported Friday its group net profit for the April to December period sank 33.3 percent from a year earlier to ¥55.15 billion ($505 million) because of falling sales in China and elsewhere in Asia.
The industrial machinery and electronic device manufacturer also said operating profit fell 16.6 percent to ¥445.63 billion on sales of ¥6.34 trillion, down 6.5 percent.
Asia comprises the largest market for Hitachi outside Japan, accounting for 21 percent of total sales, around half from China. In the world’s second-largest economy, revenue fell 10 percent to ¥707.9 billion in the reporting period.
Chief Financial Officer Mitsuaki Nishiyama said at a news conference that the outbreak of the new coronavirus in China has “made it even more difficult” to form an outlook for the global economy.
“We need to closely watch the situation such as the extent of the spread of the virus and its impact on global supply chains. But in any case, we can’t expect a big recovery in macroeconomics,” he said.
Hitachi said falling sales in the energy and automotive sectors failed to make up for a boost in revenue from information technology services and industry-use equipment, such as air conditioners.
Hitachi maintained its net profit forecast for the full fiscal year to March at ¥170 billion after booking a one-time expense of ¥378 billion stemming from a settlement with Mitsubishi Heavy Industries Ltd. over losses from a thermal power generation project in South Africa that involved their joint venture.
It lowered its projection for operating profit to ¥669 billion from ¥685 billion but kept its sales outlook at ¥8.70 trillion.