One company after another is announcing good business results for the fiscal year ended March 31, 2006. Firms listed on the first section of the Tokyo Stock Exchange are reporting increased revenues and profits for the fourth consecutive year. They are expected to post record recurring profits for the third straight year.
Strong domestic demand based on steady consumption and capital investment, as well as increases export orders, together have contributed to good performances. Companies have added to their own resilience through sustained efforts to resolve problems caused by surplus work forces, surplus equipment and excess borrowings.
Reports of account settlements also show that corporations appeared to have made a preemptive response to the new Corporate Law, which took effect May 1. The law lets boards of directors decide how much profit to distribute in dividends to shareholders. It also removes a restriction on how many times a year a company can pay dividends.