Sumitomo to book Y35 bln provision in 2023/2024 for losses at Myanmar unit

KDDI

10/04/2024 11:48

TOKYO, April 10 (Reuters) - Japanese trading house
Sumitomo Corp  8053.T  said on Wednesday it will book a
provision of 35 billion yen ($230 million) in its results for
the year just ended to account for impaired loans at its
telecoms joint venture in Myanmar.
    KDDI Summit Global will record a 105 billion yen provision
in the financial year ended March 31, due to delays in the
collection of receivables, Sumitomo said in a statement.
   The provision accounts for 80% of the loans of KDDI Summit
Global Myanmar (KSGM), which is 50.1% owned by KDDI  9433.T  and
49.9% by Sumitomo.
    As a result KDDI Summit Global will record a 105 billion yen
provision in the financial year ended March 31, due to delays in
the collection of receivables, Sumitomo said in a statement.
    "(The) Myanmar business continues to face country risk, and
there are various possible options for the future, but we intend
to continue the business there for now," a Sumitomo spokesperson
said.
    Sumitomo's share of the Myanmar unit's impaired loans is
52.5 billion yen, but the impact on its earnings will be 35
billion yen, as the trading company will reverse an impairment
loss of 17.5 billion yen it had booked in the year that ended
March 31, 2023, it said. 
    The 35 billion yen loss was not included in Sumitomo's net
profit forecast made in February of 500 billion yen for the year
ended March 31 and it is still reviewing group results, the
company said. 
    KSGM will continue to make efforts to collect
dollar-denominated lease receivables, it added.
    
($1 = 151.8700 yen)

 (Reporting by Yuka Obayashi; Editing by Sharon Singleton)
 ((Yuka.Obayashi@thomsonreuters.com; +813-4520-1265;))