Profitability At Japan's Major Traders Remains Strong, Backed By Diverse Revenue Streams And High Margins Sep 10

Standard & Poors, September 2010

Abstract
The profitability of Japan's trading companies remains strong, backed by their diversified revenue sources and relatively high profit margins in their core businesses. The six major general trading companies (GTCs) rated by Standard & Poor's Ratings Services have generally maintained strong earnings bases in Japan and overseas. They have extensively developed their resource businesses, dealing with mining of crude oil, gas, coal, iron ore, and copper. At the same time, they have also developed their nonresource businesses, such as automobiles, steel products, food, and power projects. The major Japanese GTCs are Mitsubishi Corp. (A+/Stable/A-1), Mitsui & Co. Ltd. (A+/Negative/A-1), Sumitomo Corp. (A/Stable/A-1), ITOCHU Corp. (A-/Stable/A-2), Marubeni Corp. (BBB/Stable/--), and Sojitz Corp. (BBB-/Stable/--). The industry leader, Mitsubishi Corp., and the second-ranked...

Companies mentioned in this report are: Mitsubishi Corp.,Mitsui & Co. Ltd.,Sumitomo Corp.,Marubeni Corp.,ITOCHU Corp.,Sojitz Corp.

Standard and Poors RatingsXpress Credit Research provides in-depth coverage of international corporates, financial institutions, insurance companies, utilities, sovereigns and structured finance programs. RatingsXpress Credit Research lets users determine the credit rating of holdings and identify key factors underlying an issuer's creditworthiness, distinguishes the different risk exposures for new and existing deals, and provides an understanding of how their analysts interpret key regulatory, political and environmental events and their economic impact.

Research Type: Commentary
Criteria articles describe the thought process and methodology Standard & Poor's analysts use in determining ratings. These commentary pieces discuss both the quantitative (economic and financial) and qualitative (business analysis and caliber of management) aspects of the analysis, as well as legal issues.

Mitsubishi Corp.,Mitsui & Co. Ltd.,Sumitomo Corp.,Marubeni Corp.,ITOCHU Corp.,Sojitz Corp.

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