Nonfinancial companies listed on the first section of the Tokyo Stock Exchange incurred huge profit falls in the first half of the 2001 business year, reflecting the deepening information technology slump, according to a private research institute.
Pretax profits in the April-September period plunged 35.1 percent on a consolidated basis from a year earlier, the Shinko Research Institute reported after analyzing group interim results released as of Thursday from 834 nonfinancial firms.
Net profits fell a steeper 46.4 percent.
While the 834 companies account for some 85 percent of all 974 nonfinancial companies listed on the first section and close their books in March, the profit fall as a whole is estimated to be the steepest since the bursting of the asset-inflated economic bubble in the early 1990s, the economic research arm of Shinko Securities Co. said.
The poor interim results were attributable largely to the IT slump, which has forced giant semiconductor makers such as Toshiba Corp., Fujitsu Ltd. and Hitachi Ltd. to incur net losses. The electronics sector as a whole fell into the red on a pretax basis for the first time since the compilation of comparable data began in 1964, Shinko Research said.
The slump is also blamed for a 41.2 percent drop in pretax profits in the materials sector. Specifically, textile companies scored profit falls of 38.1 percent and chemical firms dropped 34.1 percent, while steelmakers fell into the red.
However, the transportation equipment sector posted a 28.1 percent rise in pretax profits, led by record performances by Toyota Motor Corp. and Honda Motor Co.
Profits in the pharmaceutical sector rose 7.6 percent.
In nonmanufacturing, the aviation sector witnessed its pretax profit plummet 52.1 percent as a result of the Sept. 11 terrorist attacks in New York and Washington.
Profit in the construction sector fell 49.8 percent.