Toyota has raised its operating profit guidance for the current fiscal year due to a boost in the value of the company’s overseas business provided by the weaker yen. The improved outlook comes in spite of weak demand conditions inside Japan.
The latest results from the company show much improved profitability on higher revenues around the world despite lower overall unit sales.
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For the October-December quarter, Toyota said operating profit increased 27% to 762.88bn yen, well above analyst expectations. Third quarter net income was up 8.4% to 600bn yen.
For the nine-month period ended December 31, consolidated vehicle sales totalled 6,739,158 units, a decrease of 45,365 units compared to the same period last fiscal year. On a consolidated basis, net revenues for the period totalled 20.11 trillion yen, an increase of 5.2%. Operating income increased from 1.8559 trillion yen to 2.1148 trillion yen, while income before income taxes was 2.3556 trillion yen. Net income increased from 1.5260 trillion yen to 1.7268 trillion yen.
Operating income increased by 258.8 billion yen. Major factors contributing to the increase included currency fluctuations of 215.0 billion yen and cost reduction efforts of 200.0 billion yen.
Commenting on the results, TMC Managing Officer Takuo Sasaki said: “Operating income [for the nine-month period] improved by 258.8 billion yen to 2.1148 trillion yen due to positive factors such as favourable foreign exchange rates and cost reduction efforts that more than offset negative factors such as increased expenses.”
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By GlobalDataIn Japan, vehicle sales totalled 1,528,162 units, a decrease of 113,258 units. Operating income decreased by 17.8 billion yen to 1,143.5 billion yen.
In North America, vehicle sales totalled 2,107,623 units, an increase of 145,411 units. Operating income, excluding the impact of valuation gains/losses from interest rate swaps, increased by 148.6 billion yen to 457.0 billion yen.
In Europe, vehicle sales totalled 633,578 units, an increase of 3,865 units, while operating income increased by 23.3 billion yen to 66.4 billion yen.
In Asia, vehicle sales totalled 1,128,713 units, a decrease of 72,577 units, while operating income increased by 14.8 billion yen to 320.6 billion yen.
In other regions (including Central and South America, Oceania, Africa and the Middle East), vehicle sales totalled 1,341,082 units, a decrease of 8,806 units, while operating income decreased by 1.0 billion yen to 107.2 billion yen.
Financial services operating income increased by 84.4 billion yen to 285.0 billion yen, including a gain of 35.6 billion yen in valuation gains/losses from interest rate swaps. Excluding valuation gains/losses, operating income increased by 6.5 billion yen to 249.3 billion yen.
For the fiscal year ending March 31, 2015, TMC revises its consolidated vehicles sales forecast from 9.05 million units to 9.0 million units, in consideration of the latest sales trends in each region.
Toyota also revised its consolidated financial forecasts to consolidated net revenue of 27.0 trillion yen, operating income of 2.7 trillion yen, income before income taxes of 2.92 trillion yen and net income of 2.13 trillion yen, based on an exchange rate assumption of 109 yen to the U.S. dollar and 139 yen to the euro.
