Komatsu Operating Profit Falls as Mining Companies Cut Spending
Komatsu Ltd. (6301), the world’s second-biggest construction-equipment maker, said first-quarter operating profit fell 5.9 percent, missing analysts’ estimates, as sales to mining companies declined.
Operating profit was 52.4 billion yen ($535 million) in the three months ended June 30, down from 55.7 billion yen a year earlier, the Tokyo-based company said today in a statement. That compares with the 61.7 billion yen estimate of five analysts in a Bloomberg survey. Net income rose 16 percent to 37.3 billion yen, aided by reduced tax payments.
Falling commodity prices have reduced mining activity in Indonesia and Latin America, cutting into Komatsu’s sales of high-margin mining equipment. The weakening of the yen and increased spending on construction projects in Japan failed to cover the overall decline.
Komatsu’s sales for the quarter fell 3.1 percent to 455.2 billion yen.
Caterpillar Inc., the world’s largest construction equipment maker, last week cut its earnings forecast and posted profit that trailed analysts’ estimates for a third straight quarter as mining-equipment sales declined on slower commodity demand from emerging markets.
Komatsu fell 3.7 percent to 2,163 yen on the Tokyo Stock Exchange. Earnings were released after the close.
To contact the reporter on this story: Masumi Suga in Tokyo at email@example.com
To contact the editor responsible for this story: Jason Rogers at firstname.lastname@example.org