Hitachi Ltd. said Friday its group net profit for the current business year through March 2021 will surge nearly fourfold with the help of strong IT-related demand despite the novel coronavirus pandemic.
The Japanese information and infrastructure conglomerate said its consolidated full-year operating profit will fall 43.8 percent to 372 billion yen ($3.4 billion) on sales of 7.08 trillion yen, down 19.2 percent.
Hitachi said its group net profit in the year will recover to 335 billion yen from 87.60 billion yen in fiscal 2019.
Group net profit for the just-ended fiscal year fell 60.6 percent from the year before due to a one-time loss of 375.97 billion yen for a settlement with Mitsubishi Heavy Industries Ltd. over a thermal power plant project in South Africa.
"The virus spread will bring a negative impact in the first half of the business year, but our bottom line is likely to be supported by robust IT-related business," Hitachi Chief Financial Officer Yoshihiko Kawamura said in an online press conference.
He said the worldwide COVID-19 pandemic is expected to slash group sales by 1.02 trillion yen and consolidated operating profit by 301 billion yen for fiscal 2020.
The sale of its chemical subsidiary Hitachi Chemical Co. to Showa Denko K.K. in April will also decrease sales, Kawamura added.
As for the company's finances, it had 812.3 billion yen in cash and secured a commitment line worth 500 billion yen at the end of March. "We have no problem at all with our finances," Kawamura said.
In the year ended in March, Hitachi's group operating profit dropped 12.3 percent to 661.88 billion yen, on sales of 8.77 trillion yen, down 7.5 percent.
Sales in China fell 14 percent and those in Europe and North America both declined 9 percent as the pneumonia-causing virus hit the regions in the January to March quarter, while the company saw a 3 percent decline in sales in Japan, it said.
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