TOKYO, Jan 23 (Reuters) - Construction machinery maker Komatsu Ltd (6301.T) slashed its profit forecast for this year by a third to a level well below the market consensus on Friday, blaming a sudden, steep fall in global demand.
Komatsu, which competes with the world’s No.1 Caterpillar Inc (CAT.N), said it now saw an operating profit of 200 billion yen ($2.3 billion) for the year to March 2009, down from its previous profit estimate of 300 billion yen. [ID:nT2368WYFA]
That would be down 40 percent from the previous year and lag the consensus estimate in a poll of 16 analysts by Reuters Estimates of 273.7 billion yen.
“This is not good for its stock price,” Hidehiko Hoshino, an analyst at UBS, said.
“The market will focus on a possible sharp deterioration in profit in the next business year and a lack of visibility in its earnings environment.”
Hoshino said he expected Komatsu’s operating profit in the year to March 2010 could fall below 80 billion yen, given a swift fall in demand particularly in emerging economies.
Komatsu said production cutbacks and depreciation of currencies in Australia, Russia, South Africa and Brazil will weigh on its earnings this year. ($1=88.86 Yen) (Reporting by Yuko Inoue)