Japan and China lift Komatsu results

Komatsu’s construction and mining equipment sales for the fiscal year ending 31 March totalled JPY 1752 billion (US$ 17.1 billion), a +4.3% improvement on the previous year. The segment’s operating profit was up +15.9% to JPY 242 billion (US$ 2.37 billion) for a 13.8% margin.

Last year the company saw revenues increase from sales in Africa, Europe, Japan, Latin America and the Middle East. The most significant in value were the +16.9% rise in domestic sales to JPY 342 billion (US$ 3.35 billion) and the +35.1% rise in China to JPY 162 billion (US$ 1.58 billion). The biggest percentage rise was in the Middle East, where revenues were up +86.6% to JPY 33.4 billion (US$ 542 million).

However, the company saw sales decline last year in Asia (excluding China and Japan), the CIS, North America and Oceania. Most significant was the -15.2% fall in the rest of Asia and Oceania, where revenues came to JPY 349 billion (US$ 3.41 billion). The biggest fall in percentage terms was in the CIS, where sales were down -23.4% to JPY 68.5 billion (US$ 671 million).

A statement from the company said, “While demand for mining equipment remained slack in coal and iron ore mines, demand for construction equipment was brisk in Japan and increased steadily in China.”

Despite the improvement, Komatsu has forecast a fall in sales for the coming year due to more challenging market conditions. “Such market environment is attributable to demand in rental companies having run its course in Japan as well as a decline in demand for mining equipment resulting from the conservative mindset of mining customers for capital investment against the backdrop of sluggish commodity prices.”