Concerned Impact of the Weaker Yen -Reporters Round Table-

REPORTERS ROUND TABLE

Reporter A:                                                                                                  
The rainy season has come to Tokyo, and every day we see umbrella symbols on weather maps. According to the three-month forecast announced a few days ago by the Meteorological Agency, this summer will be relatively hotter. Companies selling products related to Cool Biz, the national energy-saving campaign that encourages workers to dress lightly in order to reduce air-conditioning use during the summer months– home electrical appliances such as energy-efficient air-conditioners, etc., may do well in the coming months, thanks to the competitive summer sales.

Reporter B:                                                                                                  
However, the textile industry may see a drop in income if the yen continues to weaken at the current level. We’ve already heard the voices of concern in the industry. Sudden drops in share prices and aberrant yen exchange rates are the today’s hot topics, but most see that the markets are now in the correction phase.

Reporter C:                                                                                                  
In the clothing (apparel) industry, companies purchased fair amounts of their spring and summer offerings when the yen was still strong. They’ll see the true impact of the weaker yen when they ramp up the purchasing of autumn and winter collections.

Reporter B:                                                                                                 
It’s likely that a severe blow will be dealt to OEMs that have partnership factories overseas. Bankruptcies in the textile industry have declined over the three years up to 2012, but the trend may well change in a negative way.

Reporter A:                                                                                                  
As large clothing manufacturers begin to announce their latest business results, we see some companies paint a stark picture in terms of earnings, and certain names are on the watch list. Of course, they won’t immediately go bankrupt or anything, but we need to keep our eyes on those companies.

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