Fujitsu hits two-year high after profit forecast tops estimates

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Shares in Fujitsu have jumped to a two-year high in Tokyo after the electronics company forecast an operating profit for the 2017 fiscal year that topped analysts’ estimates.

The company said, while delivering its fiscal year 2016 results after market close on Friday, that it expected to book an operating profit of ¥‎185bn ($1.66bn) in the 12 months ending March 31, topping the average of ¥‎177.9bn from analysts surveyed by Bloomberg.

This would represent a 67.5 per cent increase from the ¥‎128.9bn reported in the 2016 fiscal year, which the company reported last week.

Revenues for the 2017 fiscal year are expected to decline 32.9 per cent to ¥‎4.1tn, although net profit is expected to rise 56.5 per cent to ¥‎145bn.

Fujitsu is assuming an exchange rate of ¥‎105 to the dollar, ¥‎115 to the euro and ¥‎130 to the pound for fiscal 2017.

Fujitsu said revenue for the 2016 fiscal year, excluding the impact of currency movements, was “essentially unchanged” from the previous year. Revenues in Japan were down, while those from overseas sank 13.2 per cent.

Still, investors look encouraged by the above-estimate profit forecast. Shares were up 8.9 per cent in morning trade in Tokyo, eyeing their biggest one-day gain since early November, and reaching their highest level since May 2016. The company had been up as much as 9.3 per cent.

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