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UPDATE 1-Itochu CFO says to exit from cocoa venture with Transmar
February 3, 2017 / 6:25 AM / 10 months ago

UPDATE 1-Itochu CFO says to exit from cocoa venture with Transmar

* Itochu to quit Transmar JV after booking loss in Oct.-Dec. quarter

* Transmar’s U.S. unit sought bankruptcy protection in Dec.

* Followed Transmar’s European unit declaring insolvency

* Itochu Oct.-Dec. net profit rose 7 pct to 300 bil yen ($ 2.65 bil) (Adds background and earnings results)

By Yuka Obayashi

TOKYO, Feb 3 (Reuters) - Japanese trading house Itochu Corp booked a loss on its investment in cocoa trader and processor Transmar Group in the October to December quarter and will exit from the venture, a senior executive said on Friday.

“We will exit from the cocoa venture with Transmar although we will continue the cocoa business through other units,” Itochu Chief Financial Officer Tsuyoshi Hachimura told Reuters after an earnings news conference.

He did not give a specific amount of the loss.

Itochu, one of Japan’s biggest trading companies, said in February last year that it would buy a stake in a new joint venture with privately-owned Transmar Group.

However, Transmar’s U.S. unit filed for bankruptcy protection in December, just weeks after the parent company’s European operation declared insolvency following “unfavourable” cocoa contracts and British pound fluctuations.

For the April to December period, Itochu reported a 7 percent rise in net profit to a record 300 billion yen ($2.65 billion), backed by solid income growth in food companies such as Dole and higher contribution from its stake in CITIC Ltd, part of China’s oldest and biggest financial conglomerate.

Itochu stuck to its full-year forecast of a record 350 billion yen in net profit, in line with a consensus estimate of 363 billion yen from 10 analysts polled by Thomson Reuters I/B/E/S.

$1 = 113.0700 yen Reporting by Yuka Obayashi; Editing by Christian Schmollinger

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