(Bloomberg) — Mitsubishi Heavy Industries Ltd. returned to profitability in the latest fiscal year, buoyed by its first revenue growth in four years, as the Japanese industrial conglomerate seeks to recover from pandemic-fueled disruptions, parts shortages and a costly foray into regional aircraft.
Shares in Mitsubishi Heavy rose as much as 5% after the company reported operating profit of 28.3 billion yen ($218 million) for the fiscal period through March. Revenue rose 4.3% to 3.86 trillion yen.
Mitsubishi Heavy and other global industrial firms making high-priced, low-volume products with long replacement cycles have been hit hard by the virus outbreak, chip shortages and rise in prices for energy and raw materials. The maker of aircraft parts, ships, turbines and nuclear plants is seeking a turnaround and focusing on energy production, transport and carbon-neutrality products and services for itself and its customers. Mitsubishi Heavy suspended its troubled regional-jet program in 2020 and embarked on cutting fixed costs across its businesses.
“We made improvements in all major financial indicators while achieving record-breaking free cash flow and increasing shareholder returns,” Hisato Kozawa, Mitsubishi Heavy’s chief financial officer, said in the statement. “All of this in a period when difficult market conditions such as soaring materials and logistics costs as well as semiconductor shortages put pressure on our bottom line.”
Although free cash flow recovered and became positive to a record 302 billion yen for the latest fiscal year, Mitsubishi Heavy warned that it may shrink during the current period as it invests in carbon-neutral projects.
Mitsubishi Heavy is forecasting slight revenue growth to 3.9 trillion yen and net income of 120 billion yen for the fiscal year through March 2023. Analysts are projecting, on average, revenue of 3.8 trillion yen and net income of 121 billion yen.
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