Hitachi Plunges 10% on Earnings Miss, Japan Tobacco Net Drops 15%

Hiruki Nakamura
05 Feb, 2015
New York City

Corporate earnings in Japan were in focus and Hitachi missed operating earnings estimate but Sony reported best quarterly operating results in seven years. Toyota estimated fiscal year net to increased 17% and sales to gain 5%.

[R]4:30 PM Tokyo – Corporate earnings in Japan were in focus and Hitachi missed operating earnings estimate but Sony reported best quarterly operating results in seven years. Toyota estimated fiscal year net to increased 17% and sales to gain 5%.[/R]

Stocks in Tokyo slipped after Toyota estimated smaller than expected increase in sales and Hitachi missed operating profit estimate.

Investors also remained cautious after the European Central Bank tightened bailout terms for Greece and dropped Greek bonds as acceptable collateral for its bond buying program.

Corporate earnings were in focus in Tokyo trading and Sony soared after the electronics maker reported its best quarterly operating earnings in 28 quarters.

The Nikkei 225 Stock Average slipped 174.12 or 0.9% to 17,504.62 and the broader Topix index fell 6.89 to 1,410.11.

The yen edged up at 117.22 against one dollar.

Stocks in Review

Hitachi, Ltd plunged 9.9% to 781 yen after the diversified conglomerate reported revenues in the nine-month period ending in December rose 0.7% to 6.82 trillion yen from 6.77 trillion yen a year ago period.

Net profit in the quarter surged 37.4% to 174.94 billion yen compared to 127.27 billion yen and diluted earnings per share climbed to 36.20 yen from 26.34 yen in the same period a year ago.

The conglomerate forecasted revenues for the year to fall 0.2% to 9.60 trillion yen and net income to decline 5.7% to 250 billion yen.

The company’s U.S. subsidiary secured order for five power transformers from utility provider Grand River Dam Authority in Oklahoma, first order for power transformers in the United States.

Japan Tobacco Inc gained 1.1% to 3,388.50 yen after the cigarette maker said revenues in the year ending in December declined 10.4% to 2.15 trillion yen from 2.40 trillion yen a year ago period.

Net profit in the quarter plunged 15.3% to 368.63 billion yen compared to 435.29 billion yen and diluted earnings per share dropped to 199.56 yen from 235.35 yen in the same period a year ago.

Sony Corporation jumped 2.6% to 2,769 yen after the electronic product maker reported revenues in the third-quarter ending in December jumped 6.2% to 2.56 trillion yen from 2.41 trillion yen a year ago period.

Net profit in the quarter surged 237.1% to 89 billion yen compared to 26.4 billion yen and diluted earnings per share jumped to 76.17 yen from 22.58 yen in the same period a year ago.

Sony estimated smart-phone sales in the year to decline to 39.2 million compared to earlier guidance of 41 million and expects video games consoles sale of about 17.5 million compared to previous outlook of 17 million.

Sony forecasted total sales for the year of about 890 billion yen higher than the earlier estimate of 860 billion yen and loss for the year of about 170 billion yen compared to estimated loss of 230 billion yen in October.

Toyota Motor Corporation fell 0.9% to 7,654 yen after the automaker reported net revenues in the nine-month period ending in December climbed 5.2% to 20.11 trillion yen from 19.12 trillion yen a year ago period.

Net income in the period soared 13.2% to 1.73 trillion yen compared to 1.53 trillion yen and diluted earnings per share jumped to 545.68 yen from 481.27 yen in the same period a year ago.

Toyota lifted full-year net income forecast to surge 16.8% to 2.13 trillion yen and net revenues to climb 5.1% to 27 trillion yen compared fiscal 2014.

In automotive segment, total vehicle sales dropped to 2.26 million units from 2.32 million units a year ago while for the year the company revised consolidated vehicles sales forecast to 9 million units from 9.05 million units.

Takeda Pharmaceutical Co Ltd slid 0.3% to 5,878 yen after the pharmaceutical company said revenues in the nine-month period ending in December jumped 4.1% to 1.34 trillion yen from 1.29 trillion yen a year ago period.

Net profit in the quarter tumbled 40.2% to 79.74 billion yen compared to 133.28 billion yen and diluted earnings per share climbed to 101.16 yen from 168.64 yen in the same period a year ago.