Trading Companies, Energy: Earnings Outlook (Apr-Jun)

Research evidence excerpt

Trading Companies, Energy: Earnings Outlook (Apr-Jun)

J P M O R G A N Asia Pacific Equity Research

08 July 2026

Trading Companies, Energy:

Earnings Outlook (Apr-Jun)

Earnings progress unlikely to be viewed as a share-

price driver; focus on whether trading companies

announce new/additional share buybacks; expect a

share buyback from INPEX

Trading company sector Japan Equity Research

1Q FY2026 earnings progress: We expect that 1Q FY2026 earnings will be at Trading Companies, Energy

least 25% of full-year net profit guidance at most trading companies. We believe Jiro Iokibe AC

that higher resource prices and logistics and trade-related profits associated with (81-3) 6736-8668

the Middle East conflict are pushing up profits. Average April-June 2026 resource jiro.iokibe@jpmorgan.com

prices were $97.0/bbl for Brent crude ($78.4/bbl in January-March 2026, $66.7/ JPMorgan Securities Japan Co., Ltd.

bbl in April-June 2025); $13,355/t or $6.05/lb for LME copper ($12,824/t or $5.82/

lb in January-March 2026, $9,508/t or $4.31/lb in April-June 2025); and $238.8/t

for coking coal ($226.5/t in January-March 2026, $184.9/t in Apri-June 2025), so

so the QoQ and YoY rises were particularly large. However, because many

resource businesses, mainly energy projects, are reflected in earnings after a three-

month lag, it is important to note that the 1Q FY2026 results of trading companies

reflect the January-March 2026 results of resource businesses. We expect each

company’s progress toward full-year guidance to be 23-30%. We think progress

will be more than 25% at the six companies excluding Sojitz, which has a

seasonally low progress rate in 1Q. In descending order of progress, we forecast

30% for Mitsui & Co., 29% for Marubeni Corporation, 29% for Mitsubishi