The COVID-19 pandemic has forced 217 listed Japanese companies to warn of lower profits and sales in the coming year, an increase of 35% from less than a week ago, researcher Teikoku Databank has said.
All told, the forecast revisions represent ¥1.74 trillion ($16 billion) in lost sales, the firm said Thursday.
Japan’s earnings season for the fiscal year and quarter ending in March usually goes into full swing in late April. The nation has so far avoided the complete economic shutdowns seen in other Group of Seven countries, and only started to embrace more restrictive lockdown measures this month. That makes it more likely that companies will be reporting profit and sales warnings for the coming fiscal year, and also delay earnings reports.
“There seems to be no end in sight for the impact of the new coronavirus outbreak, with related bankruptcies reaching 61 cases,” Teikoku said. Last week, Uniqlo clothing owner Fast Retailing Co. cut its full-year operating profit outlook to ¥145 billion, 41% below its prior forecast and 27% less than analysts’ average estimate. A total of 27 retailers have cut their forecasts, according to Teikoku.
Manufacturers made up the biggest chunk of companies warning of lower profits and sales, at a quarter of the total. Service industries came second, with 53 companies revising their outlooks. Although 26 financial firms and insurers made up a smaller number, they were responsible for the bulk of the loss in revenue at ¥767 billion, or 44% of the total. Many other companies reporting so far have either declined to give forecasts, or given outlooks that only partially reflect impacts of the virus.
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