Toyota Motor Corporation (TMC) today announced its financial results for the fiscal year ended March 31, 2018 with consolidated vehicle sales of 8,964,394 units, a decrease of 6,466 units year-over-year. Region by region Toyota is experiencing the effects of a slowdown in the global automotive economy along with an ongoing increase in competition. As a result, volume is down slightly, but operating income is up.
Akio Toyoda called his management team “the seven samurai,” after the Akira Kurosawa film. Toyota said he hopes to turn the major changes happening in the auto industry into big opportunities. “Being a “mobility company” means more than pushing ahead with more of the same, but pursuing “a future that we forge ourselves,” he added.
Just like his grandfather Kiichiro Toyoda turned a loom company into an automaker, he must also take up new challenges, Akio Toyoda said. “We will do more than just survive. We will build toward the future,” he said.
TMC will pay a year-end dividend of 120 yen per common share. The annual dividend will be 220 yen per common share when combined with the interim dividend of 100 yen per common share. In addition, TMC will pay a year-end dividend of 79 yen per First Series Model AA Class Share and as a result, the annual dividend will be 158 yen per share when combined with the interim dividend of 79 yen per share.
On a consolidated basis, TMC net revenue for the period totaled 29.3795 trillion yen* ($264.68 billion), gaining 1.7823 trillion yen ($16.05 billion).
Operating income increased from 1.9943 trillion yen ($17.96 billion) to 2.3998 trillion yen ($21.61 billion), while income before income taxes1 was 2.6204 trillion yen ($23.60 billion).
- Net income2 increased from 1.8311 trillion yen ($16.49 billion) to 2.4939 trillion yen ($22.46 billion). Operating income increased by 405.4 billion yen ($3.65 billion).
- TMC said factors in the increase included currency fluctuations of 265 billion yen ($2.38 billion) and an increase of 165 billion yen ($1.48 billion) due to cost reduction efforts.
TMC by Region
North America: Vehicle sales totaled 2,806,467 units, a decrease of 30,867. Operating income, excluding the impact of valuation gains/losses from interest rate swaps, decreased by 198.7 billion yen ($1.79 billion) to 132.1 billion yen ($1.19 billion).
Japan: Vehicle sales totaled 2,255,313 units, a decrease of 18,649. Operating income, excluding the impact of valuation gains/losses from interest rate swaps, increased by 455.7 billion yen ($4.10 billion) to 1.6618 trillion yen ($14.97 billion).
Europe: Vehicle sales totaled 968,077 units, an increase of 43,517. Operating income, excluding the impact of valuation gains/losses from interest rate swaps, increased by 88.9 billion yen ($800.90 million) to 77.1 billion yen ($694.59 million).
Asia: Vehicle sales totaled 1,542,806 units, a decrease of 45,016. Operating income, excluding the impact of valuation gains/losses from interest rate swaps, increased by 4.3 billion yen ($38.73 million) to 428.8 billion yen ($3.86 billion).
Other regions including Central and South America, Oceania, Africa, and the Middle East: Vehicle sales totaled 1,391,731 units, an increase of 44,549. Operating income, excluding the impact of valuation gains/losses from interest rate swaps, increased by 54.7 billion yen ($492.79 million) to 118.1 billion yen ($1.06 billion).
Financial services operating income increased by 63.1 billion yen ($568.46 million) to 285.5 billion yen ($2.57 billion), including a gain of 1.5 billion yen ($13.51 million) in valuation gains/losses from interest rate swaps. Excluding valuation gains/losses, operating income increased by 43.4 billion yen ($390.99 million) to 283.9 billion yen ($2.55 billion).
For the fiscal year ending March 31, 2019, TMC estimates that consolidated vehicles sales will be 8.95 million units with the same market share. TMC forecasts consolidated net revenue to increase to 29 trillion yen ($276.19 billion), operating income of 2.3 trillion yen ($21.90 billion), and net income of 2.12 trillion yen ($20.19 billion) for the fiscal year ending March 31, 2019, based on an exchange rate of 105 yen to the U.S. dollar and 130 yen to the euro.
Vehicle Business Faces Unknowns
TMC says that to survive tough competition, TMC will use its internal funds mainly for the early commercialization of technologies for next-generation environment and safety, giving priority to customer safety and security.
The Fine Print
- *all currency translations above are approximate and based on an average 105-yen-to-dollar exchange rate
- 1Income before income taxes and equity in earnings of affiliated companies
- 2Net income attributable to Toyota Motor Corporation, TMC fiscal year ended March 31, 2018