Tourism and Investment in Japan

JR Central announced its financial results for the fiscal year ending March 31, 2020.  Net sales decreased by 1.8% from the previous year to 1,844.6 billion yen, operating income was 656.1 billion yen, down 7.6% and net income was 397.8 billion yen, down 9.3%.  It is the first time in 10 years that JR Central has lost revenue and the first time in eight years that profits declined.  Tokaido Shinkansen affected by COVID-19 Previously sales were expected to increase thanks to passengers increment of the Tokaido Shinkansen although profits were expected to decrease due to construction costs for Chuo Shinkansen utilizing the superconductive maglev system.  However, passengers for Tokaido Shinkansen dropped sharply and profits were depressed after March because people started to refrain from going out to contain the spread of the new coronavirus. Passengers of other local lines also seem to decline.  The forecast for the consolidated financial results...

DENSO Corporation Toyota group’s major eight companies will announce financial results in fiscal 2020 through internet broadcasting on April 30.  In advance of the internet broadcasting , Denso, one of the major eight and the world's second largest mobility supplier, announced on April 24 that it has lowered its full-year consolidated net income forecast for the fiscal year ending March 31, from ¥ 225 billion to ¥ 68 billion.  Profit decreased significantly by 70% from the previous year. In addition to the largest recall cost for automobile parts, suspending operations at overseas plants due to the new coronavirus outbreak hit the profit.  Sales forecast has been lowered from 5,260 billion yen to 5,150 billion yen, and operating income has been lowered from 280 billion yen to 61 billion yen.  In order to contain the infection, countries such as China, India, Italy, Mexico, and Argentina announced restrictions on social activities, and productions in th...

COVID-19 outbreak slows Tokaido Shinkansen Tokai Central Japan Railway, JR Central, is a railway company headquartered in Nagoya, Aichi Prefecture.  It operates Tokaido Shinkansen, which is the main artery of Japanese traffic connecting Tokyo, Nagoya and Osaka.  Transportation revenue of Tokaido Shinkansen accounts for the largest share by far in the company’s sales and has kept bringing stable profit to the company. It also operates 12 local lines around Nagoya.  With regard to recent business results, the company has been posting fairly solid financial results before the new coronavirus outbreak caused its sales to decline sharply.  As for the consolidated financial results for April to December 2019, before COVID -19 spread around the country, net profit was 38.8 billion yen, up 3% year on year. It was the eighth consecutive record high for the same period.  However, with business trips restrained and tourism businesses slowed, passengers for...

Foreign visitors to Japan in March 2020 decreased by unprecedented 93% from the same month the year before.  Tourists from East Asian regions such as China, Taiwan, Hong Kong, and South Korea have decreased significantly.  Recent business results of hotel industries, restaurant businesses and railway companies are all falling sharply due to the new coronavirus outbreak with business trips restrained and tourism businesses slowed, passengers decreased since the outbreak.  From now on, Japanese economy will be definitely hit further by COVID-19 outbreak as various tourist destinations have started calling for tourists to refrain from visiting during Golden Week, a stretch of Japanese public holidays from April 29 to May 6, to prevent the spread of infections. Gassho zukuri in Shirakawa-go For example, Shirakawa Village, Gifu Prefecture, where its Gassho style houses are registered as a World Heritage site and a well known tourist destination that attracts more...

Covid-19 outbreak increases drugstores sales Japanese consumers flock to drugstores to buy face masks and disinfectant items as coronavirus continues to spread throughout the country. Japanese drugstores sell medicines and cosmetics that bring lucrative sales as well as daily necessities such as masks, frozen foods, and even fresh foods that consumers need daily in high volume.  Those drugstores have been increasing their sales and profit continuously, expanding number of their stores at a pace of nearly 5% recently by capturing Japanese consumer’s needs and depriving share of other retail businesses. Especially in the Chubu region, drugstores keep growing steadily resulting in a fierce competition.  Among those drug stores, Genkey Drugstores Co., Ltd., headquartered in Sakai City, Fukui Prefecture, continues to grow mainly in Fukui, Ishikawa, Gifu and Aichi prefectures and has become one of major drugstore chains in the region. The number of stores as of the end ...

Bank of Japan released Tankan survey Some investors may sense a harbinger of one the worst economic depressions to come in the BOJ survey.  According to Tankan report, a short-term economic observation survey of corporate sentiment for March 2020 released by the Bank of Japan, the index of the economic judgment of the large manufacturing companies dropped to minus territory for the first time in seven years due to the spread of Covid-19 infection.  The index of large manufacturing companies dropped to minus 8 points for the fifth consecutive quarter and the first minus result since March 2013.  Stagnating demand around the world due to the spread of Covid-19 has suppressed production activities in automobile and steel industries as factories operation of those industries is downed.  The index of large non-manufacturing companies also fell 12 points from the previous survey. In particular, hotel, food and beverage services were rapidly deteriorating....

Cherry blossoms blooming In Japan In Japan, cherry blossoms are beautifully blooming this year again even though there are a few people admiring them because local governments ask people to stay home to curb coronavirus infection spreads.  Popular spots for cherry blossom viewing all over Japan are usually clouded with many people at this time every year, but Japan now has unprecedentedly quiet Cherry blossom season with the chilly breeze blowing flowers and visitors being sparse.  All Japanese are hunkering down to prevent the spread of the new coronavirus, giving up cherry blossom viewing, praying the infection will subside as soon as possible so that they can return to daily life as usual.  Cherry blossoms, widely seen throughout Japan, bloom all at once during a limited period in spring. In less than a week, beautifully blooming flowers fall.  Those contrast between the beauty of cherry blossoms and the short flowering period is often c...