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JAPAN: Mazda first half operating profit zoom-zooms up 94%

By just-auto.com editorial team | 6 November 2003

Mazda Motor Corporation has announced a whopping 94% increase in first half operating profit to 28.4 billion yen and confirmed that the company is on track to meet its full year financial targets.

Compared with the same period a year earlier, consolidated revenue increased 4% to 1,209.5 billion yen and net income doubled to 11.2 billion yen.

Mazda said its improved profitability in the first half was achieved through stronger sales, notably in Europe, China and Australia, favourable exchange rates and continued cost reduction efforts - "product cost actions" contributed to a 13.6 billion yen improvement in the company's operating profits for the first half.

Mazda president and CEO Hisakazu Imaki said, " The road ahead, though, is not getting easier, so I remain cautious. We must stay focused and achieve our cost reduction and sales targets."

Consolidated revenue for the first half of fiscal year 2003 was 1,209.5 billion yen ($US10.9 billion, €9.4 billion), an increase of 50.2 billion ($US451 million, €388 million) from the same period of the previous year. Operating profit was 28.4 billion yen ($US255 million, €220 million), an increase of 13.8 billion yen ($US124 million, €107 million) from the same period of the previous year.

Ordinary profit was 19 billion yen ($US171 million, €147 million), an increase of 9.9 billion yen ($US89 million, €77 million) from the same period of the previous year. Net income was 11.2 billion yen ($US101 million, €87 million), an increase of 5.7 billion yen ($US51 million, €44 million) from the same period of the previous year.

Mazda's full-year targets for profits and cash flow remain unchanged. Sales are projected to reach 2,500 billion yen, up 6% over a year ago, and operating profit is projected to be 65 billion yen, up 28%. With these results, FY2003 will mark the third consecutive fiscal year of increased revenue and profit and the company's best performance in a decade.

Nevertheless, the company said, FY2003 will continue to be a challenge with full-year industry demand in Japan, North America and Europe predicted to decline. Mazda projects its new-generation products will continue to drive increased retail sales in key markets. European sales should remain strong, and the company will continue to see record-setting sales in China and Australia. Retail sales in Japan and the US should be up slightly from year earlier levels. Additionally, the company's full-year results will benefit from further cost cutting and favourable exchange rates.