Toyota has reported strong profits for the fiscal year ended March 31, 2004 and the company cited its expanded global footprint as a big factor behind its record performance.
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Toyota’s net income climbed 54.8 percent in the year ended March 31 to 1.16 trillion yen (US$10.2 billion).
On a consolidated basis, net revenues for the twelve months ended March 31, 2004, increased 11.6 percent year-over-year to 17.29 trillion yen. Operating income reached a new high at 1.66 trillion yen, an increase of 395.2 billion yen, or 31.1 percent, over the previous fiscal year.
All of these figures marked record highs. Basic earnings per share for the year was 342.90 yen, an increase of 131.58 yen over the fiscal year ended March 31, 2003. Positive contributions to operating income included 320 billion yen in improved marketing efforts, 230 billion yen in cost reduction efforts, and a 107.0 billion yen gain from the transfer of the substitutional portion of the employee pension fund to the government. These gains offset the negative effects of changes in exchange rates (140 billion yen) and a 121.8 billion yen increase in labour costs and other expenses. Unconsolidated net revenues and ordinary income for the fiscal year also increased, with net sales reaching 8.96 trillion yen, an increase of 2.6 percent versus last year.
Commenting on the results, TMC President Fujio Cho said, “In fiscal year 2004, Toyota’s consolidated vehicle sales increased in all regions to 6.71 million units. As a result, our production reached full capacity, leading to improved profitability at our subsidiaries. Overall, operating profits of our subsidiaries have increased almost 300 percent over the past five years. Clearly, we are benefiting from our efforts to strengthen our overseas operations and create a global business model that is more resistant to market fluctuations and currency exchange risk.”
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By GlobalDataIn Japan, despite difficult market conditions, demand for new models like the new Raum, SIENTA, and Crown contributed to higher sales than last year. Toyota’s share of the domestic market (excluding mini-vehicles) for the twelve months ended March 31, 2004 was 42.9 percent, up 0.6 percent from the previous fiscal year.
Sales in North America reached 2.10 million vehicles, an increase of 121 thousand vehicles, mainly due to the strong popularity of models including the Sienna, Lexus RX330 and Corolla.
In Europe, favourable sales, mainly of the new Avensis and other core models such as the Yaris and Corolla, resulted in total sales of 898 thousand units, an increase of 122 thousand units over last year.
Sales in other regions including Asia, the Middle East and Oceania improved to reach 1.41 million vehicles, an increase of 277 thousand units. In Asia specifically, sales increases have exceeded the market’s rate of recovery since the economic crisis.
Toyota also announced its forecast for the fiscal year ending March 31, 2005. Based on an exchange rate of 105 yen to the U.S. dollar and 125 yen to the euro, TMC forecasts unconsolidated net sales of nine trillion yen, ordinary income of 830 billion yen and net income of 520 billion yen. TMC estimates that consolidated vehicle sales for the fiscal year ending March 31, 2005 will be 7.02 million vehicles.
Cho concluded by commenting on the consolidated profit outlook for the fiscal year ending March 31, 2005: “With a number of important domestic and overseas projects underway, we recognize the uncertainties we’re facing in both the foreign exchange and interest rate environment. In responding to these challenges, Toyota will continue its sales and cost reduction efforts and work hard to maintain the profit levels of the fiscal year ending March 2004.”
