Mazda Motor has lowered its full-year profit forecast to reflect the impact of the stronger yen.
It now says the outlook for the fiscal year ended March 31 2017 is for net income of 100 billion yen, some 26% lower than last year and lower than its previous guidance by some 155 billion yen. It now expects an operating profit of 150 billion yen, down 34% on last year and 20 billion yen down on the previous forecast.
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However, the carmaker reaffirmed its global sales target of 1.55 million vehicles for the fiscal year (which would be 1% ahead of the last fiscal year).
Mazda revised its assumed exchange rate from 110 yen to the dollar to 104, with the stronger Japanese currency shaving 42 billion yen off its operating profit, partly offset by cost and efficiency improvements. Mazda exports around 80% of its domestic production, making it vulnerable to major currency movements against the yen. "Currency woes are therefore an eternal problem for us," Vice President Akira Marumoto told the Nikkei news agency. "We have no plan to increase our factory output abroad under the medium-term business plan, but we aim to increase our earning power in every field."
Nikkei noted that for the April-September period, Mazda's group net profit slid 36% on the year to 56 billion yen, dented by yen appreciation.
