Marubeni annual net profit doubles to record

Yomiuri Shimbun file photo
Marubeni headoffice in Tokyo

TOKYO (Jiji Press) — Marubeni Corp. said Friday that its consolidated net profit nearly doubled to a record high in the year ended in March from the previous year, propelled by soaring commodity prices.

Higher prices boosted profits at the Japanese trading house’s commodities operations, such as its copper mining business in Chile and coking coal business in Australia. The company posted a net profit of ¥424,320 million for the year ended last March, a 90.1% increase from the previous year.

“We were able to push up our record profit significantly thanks to rising commodity prices and the improved profitability of our existing operations,” Marubeni President and CEO Masumi Kakinoki said in a virtual press conference.

Marubeni’s oil and gas development business also produced rosy results, while its agriculture-linked business in the United States was strong thanks to rising demand and prices for farm materials.

Its aviation and marine business also reported higher profits, thanks to improvements in the shipping market.

Kakinoki said that the company will freeze all new Russia-related deals and cancel existing ones as much as possible, in line with Japan’s sanctions on Moscow over its invasion of Ukraine.

The trading house wrote off ¥11.8 billion by reducing the value of a unit participating in the Sakhalin-1 natural gas and oil development project in the Russian Far East.

Marubeni has a roughly 12% stake in a Japanese public-private joint venture participating in Sakhalin-1.

“The Japanese government is continuing to say that it will not withdraw, so we have no choice but to follow suit,” Kakinoki said of Sakhalin-1.

The company also logged an impairment loss of ¥10.7 billion for its aircraft leasing business, due to the risk of its aircraft being confiscated in Russia.