Japan Corporate Profits

In the July-September quarter of 2016, corporate profits increased by 11% year on year. The growth in total corporate profits is mostly due to increase of 24.5% in non-manufacturing profits.

Note: Total and Non-Manufacturing does not include Finance and Insurance.

Published quarterly by the Ministry of Finance. Updated till the quarter of July-September 2016 (published on December 1st, 2016).

Recent data trend:

The July-September quarter seems to have been a favorable quarter for Japanese companies. Current profits of Japanese companies recorded a first positive year on year growth in the last 4 quarters. On a seasonally adjusted term, both manufacturers and non-manufacturers saw positive growth in their corporate profits for 2 quarters in a row. Their sales seem to be recovering too, although the level of their sales is still significantly lower than their recent peak in 2014-15. 

On the capital expenditure front, Japanese companies seem to be continuing to invest, but there seems to be little growth. In fact, in year on year terms, corporate capital investments fell by 1.4%, with both manufacturers and non-manufacturers reducing their capital expenditure by 2.0% and 1.0% respectively. 

Improvements in the corporate profits and sales are encouraging, but the sustainability of the improvement is unclear. Despite the bullish sentiment in the market created by the surprise win by President-elect Trump, we are cautious on the credibility of their policy initiatives.

Brief overview of “Corporate Statistics”:

Corporate statistics, published as "Surveys for the Financial Statements Statistics of Corporations by Industry” by the Ministry of Finance, is the survey about the financial condition of commercial corporations in Japan. 

Sales of all industry excluding finance and insurance in 2012 was 1,297 trillion yen, and Investment excluding software in 2012 was 34.6 trillion yen.

These statistics are used for estimating private non-residential investment of second preliminary quarterly GDP report.

For more information, visit the official government page

The Next Release Date:  March 1st, 2017

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