Amadeusz Juskowiak

Estimated drop in japan corporate profits trimmed

The combined profits of Japans major corporations excluding financial institutions are forecast to fall 192 pct in the 198687 year ending March 31 compared to the 199 pct decline projected in late November Wako Research Institute of Economics said

The private research body also said in a statement that 437 of the 1084 firms listed on the first section of the Tokyo Stock Exchange foresee an 116 pct fall in sales in the year against an 114 pct fall estimated last November

Current profits are projected to fall 44 pct in 198788 on sales seen increasing by 42 pct it said

Rationalisation measures taken by manufacturing industries to cope with the yens sharp rise are beginning to brighten their business outlook the institute said

It said lower interest rates which are expected to reduce corporate borrowing costs are also behind the improved performance outlook

Earnings performance in the nonmanufacturing sector will be supported by firm demand in the real estate and construction businesses it said

The forecast was based on average exchange rate estimates of 160 yen to the dollar in 198687 and 155 yen in 198788