Toyota raises annual profit forecast, eyes recovery
By Chang-Ran Kim
TOKYO (Reuters) - Toyota Motor Corp raised its full-year profit forecast by more than a third as it cuts costs, trims spending and expects Japanese government schemes to boost sales, though the guidance was still some way below analysts' expectations.
Japan's No.1 automaker now expects operating profit - earnings from its core operations - for the year to end-March of 270 billion yen ($3.5 billion), a drop of 42 percent from last year, and lagging a consensus forecast of 331 billion yen from 23 analysts surveyed by Thomson Reuters I/B/E/S.
Toshiyuki Kanayama, senior market analyst at Monex Securities, said the revised profit guidance was a bit of a disappointment. "But the market is looking at the next financial year. The key for Toyota shares will be whether profit (next year) will rise to around 800 billion yen."
Toyota, which has a market value of $135 billion -- more than rivals Honda Motor Co Ltd, Nissan Motor Co Ltd and Suzuki Motor Corp combined -- raised its annual forecast for net profit, which includes earnings made in China, by 11 percent to 200 billion yen.
October-December operating profit jumped 51 percent to 149.7 billion yen ($1.95 billion) from a year earlier, well ahead of the average estimate of a small decline to 93.9 billion yen.
Those results defied the impact of a stronger yen and the disruption to production and supply chains from widespread flooding in Thailand late last year that battered Toyota just as it was recovering from the March earthquake in Japan.
Toyota reckons the Thai floods will cost it 240,000 vehicles in lost production worldwide, allowing General Motors Co and Volkswagen AG to overtake it in 2011 vehicle sales.
Quarterly net profit slid 13.5 percent to 80.9 billion yen. Continued...