Mazda reports solid nine-month earnings, hikes estimates for full year

Mazda reports solid nine-month earnings, hikes estimates for full year

	Published : Sat, 11 Feb 2006 08:04 By : Cedric Benson Print this Story

TOKYO: Japanese auto maker Mazda Motor Corp. said its net profit for nine months ended December 2005 rose as much as 58 per cent compared to the year-ago period. The company, which exports 70 per cent of its produce, attributed the sterling performance to increased sales in Japan and China and a weak yen.

The Hiroshima-based company, 34.2 per cent-owned by U.S. auto major Ford Motor Co, said the net profit reached 41.3 billion yen, compared with 26.1 billion yen a year ago. Operating profit increased 30 per cent to 83.7 billion yen, while revenue went up marginally 4.3 per cent to 2.09 trillion yen.

Mazda's executive officer Keiji Egawa said demand for the company's Mazda 3 version continued to be strong, while the introduction of Premacy and Roadstar models had helped increase global shipment by 3 per cent to 834,000 vehicles.

During the nine months, retail sales of the vehicles in China increased 59 per cent to 102,000 compared to the earlier year period. This is a record. Domestic sales too expanded 2 per cent to 199,000.

However, the company said sales in Europe declined 2 per cent and in the U.S. 3 per cent.

The company said a weak yen had added nearly 9.5 billion yen to the company's top-line profit, as the average export hedging rate was 112 yen, against 109 yen a year earlier. Cost cutting added another 45 billion yen into the operating figure, which actually more than offset the 20-billion-yen increase in procurement costs.

Buoyed by the nine-month performance, the company increased its full-year net profit estimates to a record 60 billion yen from the earlier figure of 55 billion yen. It also increased forecast for operating profit to118 billion yen, against its previous estimate of 95 billion yen, while revenues are estimated at 2.89 trillion yen against the earlier figure of 2.82 trillion yen.

All the Japanese automakers, including Toyota Motor Corporation, Nissan Motor Co and Honda Motor Co., and now Mazda, have reported solid earnings for the October-December quarter.