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Mitsubishi heavy full-year profit misses on cruise ship losses

[TOKYO] Mitsubishi Heavy Industries Ltd reported a full-year preliminary net income that missed analyst estimates because of losses in its cruise-ship construction business.

Net income totaled 66 billion yen (S$804 million) in the year ended March 31, compared with the company's forecast of 90 billion yen, Mitsubishi Heavy said in a statement Monday. Analysts projected profit of 101.5 billion yen, according to the average of 16 estimates compiled by Bloomberg. The maker of power-plant equipment and aircraft posted net income of 110.4 billion yen a year earlier.

The Tokyo-based company said it booked additional losses on a ship order from Aida Cruises Ltd after delivering the first of two vessels in March because construction of the second cruiser was "significantly impacted" by a delay in handing over the first vessel. Mitsubishi Heavy president Shunichi Miyanagawill hold a press conference on the results and charges at 1:30 pm in Tokyo Monday.

Mitsubishi Heavy gained 0.4 per cent to 434.8 yen as of 12:54 pm in Tokyo trading, paring its decline this year to 18 per cent.

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The company booked a loss of 50.85 billion yen on the cruise ship order in the fiscal fourth quarter, bringing the total one-time charges for the last fiscal year to 103.9 billion yen, it said in a separate statement.

Mitsubishi Heavy delayed delivery of the first ship because it found faults in the main engines, carried out noise-reduction measures requested by Aida and fires broke out on board, according to the statement.