The world's largest automaker reported an annual profit of 209.4 billion yen (US$2.2 billion) and said it expected the figure to soar 48% in the current year, despite pulling around 10 million vehicles on safety issues.

Toyota posted a net profit of 112.2 billion yen in the three months ended March, the height of the recall crisis, after recording a loss of 765.8 billion in the same period a year earlier.

The company's annual profit, helped by cost-cutting efforts and buoyed by stronger domestic demand, marked a turnaround from a loss of $4.4 billion the year before when it sank into the red for the first time.

While the results come as the auto industry looks to be staging a recovery from the effects of the global downturn, Toyota's rebound has defied many expectations as it races to restore its battered reputation.

"We are still in a stormy environment," Toyota president Akio Toyoda told a news conference. "It was a year of being constantly on alert due to a series of recalls."

He added that "this fiscal year marks a truly fresh start for Toyota and I would like to steer... towards new strategies for growth," including expanding its lineup of hybrid models.

Senior managing director Takahiko Ijichi said recall-related costs in the financial year ended March would total 180 billion yen.

Despite the impact of the recalls, the automaker said it expected net profit to rise 48% to 310 billion yen, or $3.3 billion in the year to March 2011.

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