Japanese trading house Marubeni Corp has no plans to book impairment losses on its Myanmar business this financial year, but is “deeply concerned” over the situation in the country and has halted a feasibility study on power projects, its CEO said on Thursday.
Since the military seized power in a Feb. 1 coup and ousted an elected government led by Nobel laureate Aung San Suu Kyi, Myanmar has seen daily protests and a surge of violence with security forces killing hundreds of civilians.
“We are deeply concerned over the situation in Myanmar,” Marubeni CEO Masumi Kakinoki told an earnings news conference.
The company has halted its feasibility study on the projects to build a hydro power station and a gas-fired power plant.
However, it is continuing an operation at the Thilawa industrial park, near Yangon, with peers Mitsubishi Corp and Sumitomo Corp.
“We don’t want to give up and we want to continue our businesses in Myanmar, while we also need to think about protecting the safety of the people involved,” Kakinoki said.
On Tuesday, Norway’s Telenor wrote off the value of its Myanmar operation because of the country’s deteriorating security and human rights situation, sending its shares lower.
Marubeni reported a net profit of 225 billion yen ($2.1 billion) for the year ended on March 31, against a loss of 197 billion yen a year earlier as higher prices of iron ore, copper and grains boosted earnings of its metals, food and agri segments, including its U.S. grain unit Gavilon.
It forecast its profit would grow by only 2.1% this year.
“We made a conservative prediction…as grain prices are not likely to continue their rally like the previous year,” Kakinoki said. Marubeni estimated an average copper price for the current financial year of $8,000 a tonne, below the current level of around $10,000 a tonne.
In India, where COVID-19 is surging, Marubeni said it was considering sending home its expatriate workers. It did not disclose how many there were.