Mitsubishi Motors Announces FY2007 First Half Financial Results and Forecasts for the Full Year.
Mitsubishi Motors posted consolidated net sales of 1,313.4 billion yen for the first half of fiscal year 2007 (April 1 through September 30, 2007), a more than 30 percent increase of 308 billion yen over the same period last year (1,005.4 billion yen). Factors contributing to this increase include increased sales volumes in overseas markets, the start of supplies of SUVs to PSA Peugeot Citroen as well as favorable yen exchange rates.
Mitsubishi Motors posted operating income of 18.8 billion yen, an improvement of 24.3 billion yen over the same period last year despite an increase in selling and marketing costs stemming from larger advertising and publicity outlays associated with the introduction of new models in North America. Factors contributing to the improvement included the weaker yen, but a more profitable model mix and higher sales volume played a larger role. Mitsubishi Motors posted ordinary income of 6.6 billion yen, a year-on-year improvement of 19.8 billion yen. This is the first time in five years, since fiscal 2002, that the company has posted first-half operating and ordinary surpluses.
Mitsubishi Motors posted a net loss of 5.6 billion yen, a year-on-year improvement of 10.5 billion yen. While the company was able to book an extraordinary gain from the liquidation of an anonymous association, it also had to book an increase in extraordinary losses that included reorganization costs incurred in the integration of domestic consolidated sales companies and the provision of reserves to fund the cost of disposing of PCBs (polychlorinated biphenyls) waste, and there was also an increase in tax expenses of the company's consolidated overseas subsidiaries.
Unit Sales Volume
Global retail sales volume for the first half of fiscal 2007 totaled 690,000 vehicles, a 15 percent increase of 91,000 units over the 599,000 figure for the same period last year.
In Japan, where the market has shown no signs of recovery, Mitsubishi Motors sales volume decreased to 101,000 vehicles, a 12 percent decline of 13,000 units over last year. An increase in registered vehicle sales, driven by the introduction of the new Delica D:5, was insufficient to offset the drop in minicar sales volume.
In North America sales volume grew to 98,000 vehicles, a 17 percent increase of 14,000 units over the same period last year. This growth was driven by excellent initial sales of the new Lancer that made its global market debut in March this year as well as the launch of the Outlander and also by increased sales in Canada.
In Europe sales volume grew to 167,000 vehicles, an 18 percent growth of 25,000 units, driven primarily by the continuing expansion of sales in Russia, the Ukraine and other East European markets.
In Asia and other regions sales volume grew to 324,000 vehicles, a 25 percent increase of 65,000 units over last year. Factors driving this growth include higher sales of locally produced Mitsubishi brand models in China, a recovery in demand in Indonesia and other ASEAN economies, and sales remaining robust in Latin America, the Middle East and Africa.
2007 Full-year Forecasts
In the light of its first half results, the current sales climate, and other reasons, Mitsubishi Motors has revised the full-year forecasts announced on April 26.
The company has revised the full-year unit sales volume forecast announced on April 26 to 1,362,000 vehicles, a three percent increase of 39,000 units. For the second half of fiscal 2007 the company is lowering its total unit sales volume forecast to 672,000 vehicles, a two percent reduction percent of 13,000 units. While the company has raised its volume forecast for Europe where it expects sales to remain robust, it has lowered its forecasts for Japan and North America due to the harsh market environment and uncertainty about future prospects in those regions.
The company has increased its start-of-year forecast for net sales to 2,700 billion yen, an 11 percent increase of 270 billion yen, to allow for the effect of the higher unit sales volume now forecast. With this revision to the net sales forecast, the company upwardly revises its forecasts for operating profit to 70 billion yen, a 37% increase of 19 billion yen, and for ordinary profit to 47 billion yen, a 57 percent increase of 17 billion yen. The company leaves its full-year net income forecast of 20 billion yen unchanged because of expected increases in tax expenses at consolidated overseas subsidiaries in the second half, additional to those that occurred in the first half.
Operational Initiatives for the Second Half of FY 2007 (by Region)
- Launch of the new Lancer Evolution X.
- Addition of a 4WD version of the Roadest model to the Delica D:5 lineup.
- Commence sales of the high-end "SUPER EXCEED" trim level in the Galant Fortis series.
- Addition of a 3.0-liter V6 model to the Outlander series.
- Introduction of special edition models targeting female drivers in the eK, i and Colt series.
- Strengthen dealer sales capabilities.
2) North America
- Launch of the new Lancer Evolution *1. (Also to be introduced in Canada for the first time.)
- Introduction of new engine models to the Outlander and Lancer series.
- Dealer facility support program in the United States.
- Expand sales network in Canada.
- Introduction of the new Lancer in West European markets including a diesel-powered model.
- Addition of new engine models to the Outlander series.
- Expand the sales network in Russia and put the Ukranian distributor in direct contact with MMC.
4) Asia and other regions
- China: Addition of two SUV models to model range; build up and expand sales network; boost advertising and publicity.
- Latin America, the Middle East and Africa: Introduction of new Lancer and new Outlander.
- Australia: Introduction of new Lancer.
 Lancer Evolution in overseas markets.
 Lancer, Lancer EX in overseas markets.
About Mitsubishi Motors
Mitsubishi Motors Corporation (TSE: 7211) was established in 1970 and is one of the few automobile companies in the world that produces a full line of automotive products ranging from 660-cc mini cars and passenger cars to commercial vehicles and heavy-duty trucks and buses. The company also operates consumer financing services and provides this to its customer base. For more information, please visit www.mitsubishi-motors.com .
Source: Mitsubishi Motors
Mitsubishi Motors Public Relations Department http://www.mitsubishi-motors.com +81-3-6719-2111
Japan Corporate News Network. All rights reserved.
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|Date:||Oct 30, 2007|
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