After a difficult first quarter, Toyota slightly raises its profit forecast

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Toyota released its first-quarter results with profits falling sharply, but sales rising from a year earlier. The Japanese auto giant has slightly raised its forecast for its staggered 2022/2023 fiscal year.

Toyota slightly raised some of its guidance for the 2022/23 fiscal year on Thursday, but still expects plenty of headwinds after a first quarter marred by supply chain disruptions.

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Closures in Shanghai and floods in South Africa

The entire automotive sector is facing global shortages of semiconductors and logistical difficulties linked to the pandemic, in addition to rising costs due, in particular, to rising material prices.

Between April and June, Toyota’s production was particularly affected by the lockdowns in Shanghai and the floods in South Africa. And positive currency effects from the weaker yen did not offset lower sales and higher raw material costs, Toyota said in a statement.

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Therefore, the number one car in the world in 2020 and 2021 (in number of vehicles sold) saw its net profit fall by 17.9% annually in the first quarter, to 736.8 billion yen (5.4 billion euros).

And its operating profit plummeted 42% to 578.6 billion yen (4.24 billion euros), despite sales rising 7% to 8.491.1 billion yen (62.23 billion euros).

Always cautious forecasts

Nissan, an ally of France’s Renault, had also published a sharp drop in its one-year profits at the end of July, although it maintained its annual forecasts.

Despite its slightly elevated forecasts, Toyota, which surprised the market by announcing extremely cautious targets last May despite record 2021/22 results, still sees many hurdles ahead for its 2022/23 financial year due to end at the end of May. next March.

Its annual forecasts are now calculated based on an exchange rate of one dollar to 130 yen and one euro to 140 yen, up from 115 and 130 yen previously, respectively.

The manufacturer says that it now expects an annual net profit of 2,360 billion yen (17.4 billion euros), against a previous forecast of 2,260 billion yen, which would nevertheless represent a decrease of 17.2% in a year.

It has sales of 34,500 billion yen (253 billion euros) compared to the previous 33,000 billion yen (242 billion euros), which would mean an increase of 9.9% in one year.

Its operating profit forecasts remain unchanged at 2.4 billion yen (17.6 billion euros, -19.9% ​​a year).

“V Recovery”

However, the situation should improve from the second quarter according to Satoru Takada, for whom “the quality of sales and the cheap yen” will be significant enough to cushion the negative factors of the cost of raw materials and production difficulties .

In volume, the manufacturer still expects to sell 10.7 million vehicles (including its Daihatsu and Hino subsidiaries) by the end of next March, that is, 300,000 more than in 2021/22.

And it still expects production of 9.7 million Toyota and Lexus vehicles for the full year, up from 8.5 million units in 2021/22.

Little reassured by Toyota’s forecasts, investors sanctioned it on the Tokyo Stock Exchange, where its stock ended down 3% after the announcement of its results.

Author: Julien Bonnet with AFP
Source: BFM TV

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