Singapore 29/03/2016 - Japan’s Mitsubishi Corp is expecting a 150-billion-yen loss ($1.3 billion) for its fiscal year ending March 31, 2016 due to impairment losses of around 430 billion yen incurred in its fiscal fourth quarter, the company said late last week.
The company had forecasted in November that it would make a net consolidated net income of 300-billion-yen for its current fiscal year.
Of the total post-tax impairment loss, the largest loss of 280 billion yen is from its Chile copper business, where it has a 20.4 percent-stake in Chilean copper miner and smelter, Anglo American Sur (AAS), which is 50.1 percent owned by Anglo American.
“Considering the downturn in the copper market and the extended timeframe now required for the development of mining projects, Mitsubishi has concluded that it is difficult to recover the entire carrying value of the investment to AAS,” the company said.
Its other metals business which incurred impairment losses includes its Australian iron ore and South African ferrochrome operations. Its other resource business is in the energy sector.
Mitsubishi had made a 400.57-billion-yen profit in the fiscal year ended March 31, 2015.
The companyjoins other global metal miners and traders including Japanese trading houses - Mitsui & Co and Sumitomo Corp – who have had to write off millions of dollars of metal assets due to the global slump in commodity prices.