Komatsu Ltd., the world’s top producer of excavators, forecast annual profit will rise 46 percent this fiscal year as a weaker yen makes its products more attractive to customers outside Japan.
Net income will probably rise to 184 billion yen ($1.86 billion) in the year started April 1 from the 126 billion yen in profit reported today, the Tokyo-based company said in a statement. Komatsu’s fourth-quarter profit fell 6.5 percent to 35.2 billion yen from 37.6 billion yen a year ago.
Komatsu expects this year to be its best since the 12 months ended in March 2008, reflecting the benefit some exporters are seeing following the Japanese currency’s 13 percent drop against the dollar this year. Demand for construction machinery in Japan and North America will support earnings, the company said.
Industry demand in China is expected to recover in the current year with growth ranging from 3 percent to 8 percent, the statement said. Komatsu’s sales volume will probably be flat in the year started April while revenue by value is forecast to increase 16.7 percent aided by the yen, CFO Mikio Fujitsuka said.
Shares in Komatsu, the biggest maker of construction and mining equipment after Caterpillar Inc. of the U.S., rose 0.2 percent to a more than 21-month high of 2,587 yen in Tokyo before the release of earnings. That was the highest since July 6, 2011.
Peoria, Illinois-based Caterpillar cut its 2013 forecast and lowered “significantly” its outlook for demand from commodities producers. Profit in 2013 will be about $7 a share, compared with a January projection of $7 to $9, the U.S. company said April 22.
For the year ended March 31, profit at Komatsu fell 24 percent on lower demand in China. Total sales declined 4.9 percent.
The yen traded at 99.07 yen to the dollar as of 3:15 p.m. in Tokyo.