Zojirushi Faces Decline in Profits as Sales of Kitchen Appliances Lag
Shares of Japanese kitchen-appliance manufacturer, Zojirushi, experienced a significant drop in value after the company reported a decline in nine-month profits. Weak sales of rice cookers and other cooking equipment within the domestic market were cited as the main contributing factor.
As of Tuesday, Zojirushi shares were down 7.1% to 1,675 yen, following an earlier decrease of 11%.
Zojirushi announced on Monday, after the close of the market, that their net profit for the nine months ending on August 20 had fallen by 0.3% compared to the previous year, amounting to Y3.71 billion ($24.8 million).
Although nine-month revenue remained flat at Y61.94 billion, Zojirushi reported disappointing sales of rice cookers, hot plates, and toaster ovens domestically, which offset the solid sales of rice cookers in North America and Southeast Asia.
The company further explained that a weaker yen resulted in increased costs for imported parts and higher selling, general, and administrative expenses also weighed on earnings.
Despite these setbacks, Zojirushi maintained its earnings forecasts for the fiscal year ending November 20. It estimated that revenue would rise by 1.8% to Y84.00 billion, while net profit would experience a substantial increase of 16% to Y4.25 billion.
By Kosaku Narioka
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