Komatsu Cuts Full-Year Profit Target as Mining Demand Slumps
Komatsu Ltd. (6301), the world’s second-largest maker of construction equipment, cut its full-year profit forecast by 26 percent after its commodity producing customers curtailed spending on new equipment.
Net income is estimated at 136 billion yen ($1.39 billion) in the 12 months ending March 31, down from the 184 billion yen projected in July, Tokyo-based Komatsu said today in a regulatory statement.
Slumping demand from mining companies in Latin America, Indonesia and Australia is overshadowing growth in Japan and a recovery in China, Komatsu said. The lower forecast follows a similar move by Caterpillar Inc., which last week cut its 2013 sales and profit outlook.
Caterpillar said on Oct. 23 that earnings will fall to about $5.50 a share on sales of $55 billion this year. In July, it forecast per-share profit of about $6.50 on sales of $56 billion to $58 billion.
For the first half ended Sept. 30, sales of construction and mining equipment in Asia outside Japan and China fell 30 percent to 91.9 billion yen, Komatsu said. Japan sales rose 13 percent to 150 billion yen, while China revenue gained 16 percent to 72.8 billion yen.
BHP Billion Ltd. (BHP) and Rio Tinto Group, both Komatsu customers, are among mining companies that have cut billions of dollars of capital expenditure this year.
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