HomeBusinessTrading house Sojitz predicts record annual profit on higher coal prices

Trading house Sojitz predicts record annual profit on higher coal prices

TOKYO : Japanese buying and selling house Sojitz Corp on Wednesday raised its web profit forecast by 14per cent to a record 80 billion yen ($699 million) for the yr to March 31 because of higher coal prices.

Average thermal coal prices throughout the 9 months to Dec. 31 rose almost three-fold from a yr earlier to $163.9 a tonne whereas a median coking coal value greater than doubled to $278.0 a tonne, Sojitz stated.

The firm is in talks to promote its thermal coal property as a part of a plan to exit from thermal coal enterprise by 2030 and it has put aside a 5 billion yen restructuring cost for the yr as it might guide an impairment loss from the deal, CFO Seiichi Tanaka stated.

“We have booked the charge including provisions to avoid our thermal coal assets from becoming stranded,” Tanaka informed reporters.

Japanese buying and selling homes are rushing up efforts to shift away from coal and different fossil gasoline property amid a rising decarbonisation push worldwide and to match an bold authorities pledge to change into carbon impartial by 2050.

Sojitz stated final March it deliberate to halve its upstream thermal coal property by 2025 and exit by 2030 whereas it should scale back its upstream coking coal property to zero by 2050.

The firm goals to promote one of many two remaining thermal coal property this monetary yr, a spokesperson stated, with out disclosing the names of the mines.

For the April-December interval, Sojitz’ web profit jumped almost four-fold to 62 billion yen as hovering prices in thermal coal and coking coal bolstered its metals profit.

As a consequence, the corporate elevated an annual profit estimate of its metals enterprise to 44 billion yen from 31 billion yen.

($1 = 114.4100 yen)

(Reporting by Yuka Obayashi. Editing by Jane Merriman)

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