Continuing labor problems, coupled with lower global prices of commodities and difficulties associated with the weather, at its Australian coking-coal subsidiary have taken its toll on the overall net profit of Mitsubishi Corp. for the first quarter.

In a statement on Thursday, Japan's top trading house said its net profit in the three months to June had dropped 15.2 per cent to ¥98.14 billion ($1.25 billion) from a year ago, with revenue likewise falling down in the quarter by 0.8 per cent to ¥4.8 trillion in the quarter.

Setbacks in manpower, a stronger yen, high administrative costs and falling prices of commodities in the world market all factored in the revenue drop, the Japanese firm said.

Output at its Australian coking-coal subsidiary, a joint project between Mitsubishi Corp. and Anglo-Australian mining giant BHP Billiton Ltd., have been disrupted due to the labor problems the project is experiencing for quite some time now. The project, currently operating at 70 per cent capacity, has a long-running dispute over wages and worker participation in business strategy.

But a settlement is being eyed to be signed with the workers this month, after which full operations are expected to be back to normal by end September, the company said.

The joint venture reached a tentative agreement with the workers, announcing the end of force majeure in early July.

"We haven't seen a strike since July 6," Chief Financial Officer Ryoichi Ueda said.

Mitsubishi Corp. likewise reported that operating profit for the period dropped 79.1 per cent to ¥17.61 billion, from ¥84.20 billion the previous year.