Mitsubishi Heavy Industries posted quarterly net income that fell short of analysts¡¯ projections due to a drop in defense orders, even as revenue continues to climb for its core businesses.
Shares in the manufacturer fell 2.5% Tuesday after it reported that net income for the June-September period was ?44.8 billion ($294 million), compared with analysts¡¯ average estimate of ?67.5 billion. Revenue was ?1.19 trillion, exceeding a forecast ?1.17 trillion.
The company¡¯s share price has more than doubled this year, thanks to investors¡¯ high expectations of its energy and defense businesses. With both sectors forming the pillars of its mid-term plan, it aims to boost revenue in those segments by ?1 trillion before the end of the 2026 fiscal year.
¡°Currency fluctuations and inflation make the future unpredictable, but strong order intakes are encouraging,¡± CEO Seiji Izumisawa said at a briefing.
Mitsubishi Heavy¡¯s aircraft, defense and space segment saw a ?197 billion decline during the first half of the current fiscal year due to an exceptionally large volume of orders last year during the same period, it said.
Business profit, which doesn¡¯t account for manufacturing and sales expenses, rose 87% to ?188 billion during the six months through end-September. It is maintaining its full-year profit guidance at ?350 billion and raised its order intake forecast to ?6 trillion, which is 10% lower than last year.
Mitsubishi Heavy¡¯s defense and space segments saw orders increase for gas turbine engines and steel-making machinery, while profit rose in its energy, defense and space units.
Japan¡¯s Defense Ministry has awarded a ?56 billion contract to Mitsubishi Heavy to develop a glide phase interceptor, a missile defense system designed to take down hypersonic weapons, the company said Friday.
The Tokyo-based heavy machinery maker holds the biggest share in the global market for gas turbine engines. It s also one of the lead contractors in a trilateral partnership between Japan, Italy and the U.K. to build a next-generation stealth fighter jet.
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