Mitsui & Co. profit hits record high, to stay involved in Russian gas
Japanese trading giant Mitsui & Co. nearly tripled its annual profit to a record high on the back of soaring energy and commodity prices, and said the company would maintain its involvement in liquefied natural gas projects in Russia.
Net profit for the year ended March jumped to 914.7 billion yen ($7 billion), it said in a statement on Monday, adding that it would spend up to 100 billion yen on buy back 3% of its shares in order to reward investors. The strong results, which beat analysts’ estimates, come even as the company reported a 20.9 billion yen loss related to LNG projects in Russia in the fourth quarter.
Mitsui Chairman Kenichi Hori said the company would remain involved in the Sakhalin-II LNG project, a very important energy source for Japan. Mitsubishi Corp. and Mitsui & Co. together own 22.5% of the Sakhalin project, and the majority of the gas produced there supplies Japan. The company said it would also proceed as planned with the development of the Russian Arctic LNG 2 project, while closely monitoring the situation.
“Uncertainty is growing and geopolitical risk is unpredictable,” Hori told a briefing. “We will keep in mind the need for energy security.”
Mitsui and other trading houses are profiting from soaring energy and commodity markets, as supply constraints, geopolitical tensions and rebounding demand drive up prices for everything from ore to iron to oil and coal. Mitsui is the first of Japan’s top five trading houses known as “sogo shosha” to report earnings and guidance for the fiscal year which began in April.
For the coming year, Mitsui expects net profit of 800 billion yen, in line with analysts’ estimates. Hori said earnings will moderate as market conditions for some commodities normalize. The company said it would buy up to 50 million outstanding shares between May 6 and September 22.
recommended for you
JERA, Tokyo Gas and Inpex join Santos-led Bayu Undan CCS project
Join the global energy conversation
Unlimited internet access from only £12.50 per month