The total net profit of listed companies in Japan increased 7.4 percent to 29.3 trillion yen for fiscal 2022, driven by gains in trading houses on the back of a weaker yen and rising prices of natural resources, a tally by a securities firm showed Friday.
The figure is based on earnings results of 754 companies released by Thursday, accounting for 52.6 percent of about 1,400 Japan's major firms surveyed by SMBC Nikko Securities Inc.
The net profit at nonmanufacturers, excluding financial companies, jumped 22.0 percent to 12.82 trillion yen thanks to robust performance in wholesale and inbound tourism sectors.
The nonmanufacturers also excluded SoftBank Group Corp., an investment giant which logged a net loss of more than 900 billion yen.
The wholesale industry, including trading houses, was a bright spot, with its profit up 19.1 percent to 5.04 trillion yen, while the government's relaxation of COVID-19 measures increased by about 15-fold the net profit in the land transportation sector to 952.9 billion yen.
The air transportation sector returned to the black with a net profit of 127.9 billion yen, helped by an increase in travelers to Japan.
In contrast, the utility sector fell into the red, logging a net loss of 63.2 billion yen due to soaring energy prices.
Manufacturers, meanwhile, saw their net profit fall 5.5 percent to 16.27 trillion yen as rising material prices triggered by the war in Ukraine took a toll.
The net profit for the transportation equipment sector, including automakers, was down 4.7 percent to 4.39 trillion yen.
Electric appliance companies posted a total net profit of 4.74 trillion yen, down 3.1 percent, while food companies also saw a nearly 20 percent fall in profit.
Fifteen out of a total of 33 industries booked either a fall in profit or net loss, the tally showed. The 15 included 10 manufacturers.
Hikaru Yasuda, equity strategist at SMBC Nikko, said he expects Japanese companies' earnings to continue improving this fiscal year as the economy recovers from the coronavirus pandemic.
But Yasuda also warned of a potential risk amid signs of a recession in the United States. "Depending on the speed of global economic slowdown, a slump in demand may impact their earnings," he said.
