Japanese Firms’ Earnings Jump 16% to Record

Large Japanese companies reported record earnings of 21.05 trillion Japanese yen, the equivalent of $156.8 billion U.S., for the fiscal year ended in March, the National Tax Administration Agency said.

The earnings of the 4,605 firms were 16.3% higher than in fiscal 1986, said the tax administration’s report published Monday.

Nippon Telegraph & Telephone moved up from fourth in fiscal 1986 to lead corporate earnings with 511.2 billion yen ($3.8 billion), boosted by the rapid spread of telephone and facsimile communications, the report said.

Electric Company Slips

Nomura Securities, Japan’s largest brokerage, edged out Toyota Motor Corp. for second place with earnings of 478.5 billion yen ($3.56 billion) to Toyota’s 427.6 billion yen ($3.18 billion).

Toyota was No. 2 the previous fiscal year, and Nomura was third.

Tokyo Electric Power Co. fell from the top spot to fourth, reporting earnings of 420.6 billion yen ($3.18 billion).

News reports said the power company’s cut in rates because of lower crude oil prices and foreign exchange gains resulting from the strong yen were behind the firm’s profit decline.

Tax Payments Up

Financial firms filled out the rest of the top 10. Dai-Ichi Kangyo Bank reported earnings of 351.8 billion yen ($2.62 billion); Sumitomo Bank, 347.8 billion yen ($2.59 billion); Fuji Bank, 294.1 billion yen ($2.19 billion); Mitsubishi Bank, 292.8 billion yen ($2.18 billion); Daiwa Securities, 286.4 billion yen ($2.13 billion), and Sanwa Bank, 252.5 billion yen ($1.88 billion).

Banks and securities firms, led by booming investment and historically low interest rates, snared 27 of the top 50 positions, one more than in fiscal 1986, the report said.

It said the 4,605 firms paid a record 7.58 trillion yen ($56.48 billion) in taxes in fiscal 1987, up 14.2% from the previous year.

A duty officer at the tax office said no officials were available to comment on the report Monday.