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Toyota profit triples to $9.7bn

08 May 2013, 18:51

Tokyo - Toyota on Wednesday said its full-year net profit more than tripled to $9.7 billion, with the world's largest automaker adding that it was on track for another soaring profit in the current fiscal year.

The rosy annual profit underscores the recovery among Japan's major automakers after the 2011 quake-tsunami disaster devastated sales and production, and highlights strong demand in the key Asian and US markets.

The yen, which has lost about one-fifth of its value on the dollar since November, has also helped, boosting Japanese firms' competitiveness overseas and jacking up the value of their repatriated foreign income.

The declining yen was among the factors cited by Toyota for its profit jump, after rival domestic automaker Honda said its net profit for the year to March soared 73.6% thanks to robust overseas sales, a weaker yen, and cost cutting.

Toyota on Wednesday said it booked a net profit of ¥962.1bn ($9.7bn) in the fiscal year to March, up from ¥283.5bn a year earlier, on sales of ¥22.0 trillion, an increase of 18.7% on-year.

The firm, which last year overtook General Motors to regain the title of world's biggest automaker, also said it expected to earn a net profit of ¥1.37 trillion for the fiscal year ending March 2014.

"We experienced increased sales of our vehicles mainly in North America and Asia," Toyota President Akio Toyoda said, also pointing to "company-wide profit improvement activities".

"The world's new car demand is expected to grow going forward, driven by the recovery of the US market and the development of the emerging markets."

Global vehicle sales hit 8.87 million units in the year to March, Toyota said, despite nearly flat results from recession-riddled Europe.

The Camry and Corolla maker added that vehicle sales in the current fiscal year were on track to hit 9.1 million units.

However Japan's three biggest automakers - Toyota, Nissan and Honda - have seen results dented by the fallout from a bitter territorial row between Tokyo and Beijing that fuelled a consumer boycott of Japanese products.

The long-standing dispute flared again in September when Tokyo nationalised some of a tiny East China Sea archipelago that is also claimed by Beijing, setting off huge demonstrations across China, the world's biggest vehicle market, and the damaging boycott.

Toyota did not make specific reference to the spat in its earnings statement on Wednesday, but has previously said it would take a hit from the diplomatic battle.

Honda last month said sales in China have almost returned to normal levels while Nissan, which has the most exposure to China among Japan's top-three automakers, reports its results later this week.

The absence of now-expired vehicle subsidies in Japan have weighed on consumer demand at home, while the nation's automakers have also been hit by a string of damaging safety recalls that hurt their reputation for quality and safety.

But Japanese automakers and durable goods producers are eyeing strong buying as Tokyo begins hiking the national sales tax over the next year, eventually doubling it to 10% by 2015.

Japanese industry has benefited from the big-spending and easy-money policies of Prime Minister Shinzo Abe, who swept December elections on a promise to inject new life into the world's third-largest economy.

Huge easing measures from Abe's hand-picked team at the Bank of Japan have also pushed down the yen, with the dollar buying ¥98.88 in afternoon Tokyo forex trade on Wednesday - from a low of around ¥75 in late 2011.

Toyota shares finished 1.38% higher to ¥5 840 in Tokyo on Wednesday. Its results were published after markets closed.



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