Japanese confectioner Morinaga reported a 63.6% drop in profits for the fiscal year ended 31 March as sales stagnated.

The group said pre-tax profits in the year plunged to ¥3.39bn (US$27.3m) as overall sales tumbled 12.7% to ¥174.63bn.

Sluggish sales of the group’s core confectionery products were exacerbated by the depreciation of the yen against other currencies, which hiked the expense of imported raw materials.

A booking of ¥2.34bn in extraordinary profits slashed the fall in profits to a decline of just 1.3% to ¥2.14bn, most of the extraordinary profit gain derived from the liquidation of the employees’ pension fund.

The group will pay a dividend of ¥5 per share for fiscal 2001, in line with fiscal 2000.

On a more positive note, the group said it expects to report group pre-tax and net profits of ¥4.1bn and ¥1.7bn respectively, on sales forecast at ¥178bn.