Sumitomo Corp Forecasts Record Profit, Sets Aside Tariff Buffer

TOKYO: Sumitomo Corp, a prominent Japanese trading firm, has projected a record net profit of 570 billion yen ($4 billion) for the current fiscal year. The company is also establishing a financial safeguard to mitigate potential adverse effects from U.S. tariffs.

Sumitomo reported a net profit of 562 billion yen for the fiscal year concluding in March, marking a 45.4% increase year-over-year. This figure surpassed analysts’ estimates of 554.2 billion yen, driven by robust performance in non-mineral resource sectors, including real estate.

Berkshire Hathaway, led by Warren Buffett, holds a substantial minority stake in Sumitomo and other Japanese trading houses, such as Mitsui, and has been progressively augmenting its ownership.

The company has allocated a loss buffer of 40 billion yen, explaining that while the immediate consequences of U.S. tariffs are expected to be limited, “a certain degree of indirect impact may arise, and thus, a loss buffer has been set accordingly.”

Sumitomo intends to raise its annual dividend to 140 yen for the fiscal year ending next March, up from the current 130 yen. Furthermore, it plans to repurchase up to 2.9% of its shares, valued at 80 billion yen.

The company anticipates nickel production at its Ambatovy nickel project in Madagascar to reach approximately 30,000 metric tons this year, an increase from under 30,000 metric tons last year, as various operational challenges, including pipeline issues, are being addressed.