Toyota Sees 39% Increase in Quarterly Profit

Toyota Motor Corp. posts a 39.2% jump in its fiscal first-quarter profit, to ¥371.5 billion ($3.2 billion).

Net revenue for the No.1 Japanese auto maker rose 13.2% to ¥5.64 trillion ($49.3 billion), while operating income increased 26.5% to ¥512.4 billion ($4.5 billion).

Toyota says positive contributions to operating income include a ¥100 billion ($874.1 million) currency translation effect, ¥60 billion ($524.5 million) from marketing efforts and ¥20 billion ($174.8 million) in cost-reduction efforts.

Detrimental to operating income was a ¥27.5 billion ($240.4 million) increase in research and development expenses, Toyota says.

“We posted substantial increases in both revenues and profits, achieving record levels,” says TMC Senior Managing Director Takeshi Suzuki. “We believe this is a result of company-wide efforts to implement the plans that we set at the beginning of this fiscal year.”

Toyota sold 2.09 million vehicles in the first quarter, up 143,000 over first-quarter 2005.

While sales in Japan slipped 7,000 units vs. year-ago to 543,000, Toyota saw a 1.5 % increase in market share (excludes minivehicles) to 46.5%.

Toyota credits increased Japanese production for its domestic operating income, up ¥104.6 billion ($914.1 million) to ¥293 billion ($2.6 billion).

North American sales rose 106,000 units to 747,000 on the strength of the new RAV4 and FJ Cruiser utility vehicles, plus the Yaris small car.

North American operating income jumped ¥2.3 billion ($20.1 million) to ¥140.1 billion ($1.2 billion) as a result of strong sales, offsetting start-up costs incurred by the auto maker’s new Texas manufacturing plant.

Toyota’s European sales posted an increase, up 52,000 units from year-ago to 308,000, despite what it calls “weak market conditions” in the region. A ¥19.8 billion ($173.1 million) rise in operating income, to ¥36.5 billion ($319.1 million), is due to strong sales of the Yaris and RAV4, as well as the Lexus IS, Toyota says.

The Asian region was the one dark spot for Toyota, with sales dropping 36,000 units to 193,000 and operating income falling ¥9.8 billion ($85.7 million) to ¥30 billion ($262.3 million). Toyota blames sales slumps in Indonesia and Taiwan, as well as production downturns in the region, for the poor performance.

Sales in other regions, which include Africa, Oceania and South and Central America, rose 28,000 units to 300,000 vehicles. However, operating income in the regions fell ¥1.1 billion ($9.6 million) to ¥15.9 billion ($139.1 million).

Toyota’s forecast for the fiscal year ending March 31, remains unchanged, with net revenue of ¥22.3 trillion ($195.1 billion); operating income of ¥1.90 trillion ($16.6 billion); and net income of ¥1.31 trillion ($11.5 billion) predicted.