TOKYO, August 3, 2008 (AFP) – The pre-tax profit of major Japanese companies fell 15 percent year on year in the April-June quarter, weighed down by the US economic slowdown and price hikes, a survey showed on Sunday. The survey was conducted by the Nikkei business daily, covering 685 companies that had reported their quarterly earnings by Friday, or about 40 percent of all listed firms in Japan, excluding financial entities and those listed on the markets for start-ups.
It will be the second consecutive quarter of decline, the newspaper said, warning that Japanese companies may see their combined profit for the fiscal year to March 2009 drop on an annual basis for the first time in seven years.
Profit declined amid a changing business environment in which the subprime mortgage crisis significantly weakened the US economy, sharply lifting the yen against the dollar, the newspaper said.
Compared with year-earlier levels, the yen strengthened by nearly 16 yen on average against the dollar during the April-June quarter.
The falling dollar was also responsible for boosting crude oil prices.
Surging fuel and raw material costs walloped steelmakers, although they were beginning to pass on a portion