During the six-month period ended September 30, 1999, net sales (total trading transactions) declined \889.1 billion, or 19.2%, to \3,751.2 billion, reflecting the withdrawal from low-margin transactions as part of the management policy outlined above. Gross trading profit declined \13.5 billion, or 9.5%, to \128.6 billion.
By trade category, exports were down 15.6% to \521.5 billion, due to declines in machinery and information, and metals. Imports fell 34.2% to \721.0 billion, with lower transaction levels for machinery and information, metals, and energy and chemicals. Offshore transactions declined 25.3% to \957.0 billion amid a fall in energy and chemicals trading, and domestic transactions decreased 5.8% to \1,551.7 billion as a result of lower metals trading.
Transactions declined in each commodity type: by 36.8% in energy and chemicals, by 21.4% in metals, by 12.5% in consumer products, and by 9.8% in machinery and information.
Despite lower transactions, operating income grew \2.8 billion, or 16.1%, to \20.8 billion, as the Company's shift to more efficient consolidated management succeeded in slashing selling, general and administrative expenses.
As a result, recurring profit climbed \8.7 billion, or 115%, to \16.2 billion.
The Company recorded a provision for doubtful receivables of \6.0 billion as an extraordinary loss to cover irrecoverable loans, which were announced on November 12, 1999, leading to an interim net loss of \2.3 billion. In the absence of this extraordinary charge, higher results at consolidated subsidiaries in Japan and overseas would have supported net income of \3.7 billion.
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