Mazda Motor Corporation has announced its first
consolidated net profit in seven years for the half-year to September 30. The company
said that cost cutting and a weak Yen boosted profits beyond expectations, as well as
which it also increased its domestic market share as popular new models helped cushion the
impact of Japan’s economic slump.
Mazda, which is Japan’s fifth-largest automotive manufacturer, said it earned an
estimated group net profit of 8.5 billion Yen ($A115 million) in the first half of the
fiscal year, compared with a 9.7 billion Yen ($A135m) loss in the same period last year.
It raised its parent net profit estimate for the period to 5.5 billion Yen ($A76m) from
an earlier forecast of 5.0 billion Yen ($A70m).
"When we made our projections, we saw this as an opportunity for Mazda to move to
a new level of financial performance and I think we’ve demonstrated that,"
Mazda's chief financial officer Gary Hexter said.
He added, however, that economic sluggishness in Japan and the rest of Asia, as well as
sharp fluctuations in the Yen, would continue to pose challenges for the company.
The sharp rise in the Yen in recent weeks has clouded the outlook for currency-related
profits in Japan’s automotive sector, but Mr Hexter said the nation’s weak
economic conditions called for an exchange rate of about 140 to 150 Yen per US dollar,
rather than recent levels of around 115 Yen.
Yen weakness in the first half of the fiscal year boosted Mazda’s profits by 11.0
billion Yen ($A154m) from year-ago levels, far exceeding the company’s initial
forecast of a 5.0 billion Yen ($A70m) currency gain. Cost cutting added another 14.0
billion Yen ($A195m) to profits, well above the original projection of 3.0 billion Yen
($A42m).
