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Toyota Boosts Outlook as Half-Year Profit Soars

Nov. 6, 2013
The world's biggest carmaker said it earned 1 trillion yen ($10.14 billion) on revenue of 12.53 trillion yen, up 14.9% year-on-year.

TOKYO - Toyota said Wednesday that its half-year net profit soared 82.5% while it raised its annual earnings forecast as a weak yen and improving sales in North America boosted its bottom line.

The world's biggest carmaker said it earned 1 trillion yen ($10.14 billion) on revenue of 12.53 trillion yen, up 14.9% year-on-year.

The maker of the Camry sedan and Prius hybrid also raised its fiscal year to March profit forecast to 1.67 trillion yen, up from 1.48 trillion yen previously.

Toyota (IW 1000/8) has ramped up its bid to tap emerging markets while key U.S. demand has also been on the upswing, helping the firm book ever-increasing profits.

The automaker tripled its net profit in the past fiscal year with a slump in the yen helping Japanese manufacturers' bottom line by making them more competitive overseas and inflating repatriated foreign earnings.

Toyota acknowledged that cost cuts and the weaker currency helped boost its profit as global unit sales slipped about 1% to 4.46 million units.

"In addition to the impact of the weaker yen, operating income increased due to our efforts with our suppliers and distributors for profit improvement through cost reduction and marketing activities, such as enhancement of the model mix," Toyota Vice President Nobuyori Kodaira said in a statement.

The company added that it still expects to sell 9.1 million vehicles in the year to March 2014.

Toyota was the last of Japan's major automakers to report its financial results in the latest earnings season.

Weaker Yen Also Helped Honda

Honda (IW 1000/29) earlier said net profit soared nearly 47% in the three months to September as Japan's third-largest carmaker also benefited from a weaker yen and stronger North American sales -- while smaller rivals Suzuki and Mitsubishi Motors also reported upbeat results.

However, Nissan shares plunged more than 10% Tuesday after the Japan's No. 2 carmaker slashed its full-year profit forecast, blaming a sluggish European market and expensive product recalls.

Nissan said sales to China, which accounts for about one-quarter of its sales, also fell in the wake of a Tokyo-Beijing territorial spat that sparked a damaging consumer boycott of Japanese brands in the world's biggest vehicle market.

Toyota did not specifically address China in its statement Wednesday.

However, Japanese automakers' sales in the country were dented in the wake of the diplomatic row, which flared again last year when Tokyo nationalized part of a small East China Sea archipelago, also claimed by Beijing, setting off demonstrations across China and the damaging boycott.

Despite the China troubles, Japanese industry has benefited from the big-spending and easy-money policies of Prime Minister Shinzo Abe, with huge monetary easing measures from the premier's hand-picked team at the Bank of Japan helping push down the yen.

The nation's manufacturers are eyeing a pickup in domestic demand ahead of a sales tax hike next year.

Copyright Agence France-Presse, 2013

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