Mazda Motor Corporation (TYO: 7261) reported a much stronger third quarter during FY18. However, this still does not compensate for the weaker results the company showed in 3Q17 after negative fluctuations in foreign exchange rates.
For the three months ended in Dec. 31, 2017, net sales increased 11.1 percent compared to 3Q17, accounting for ¥891.3 billion (US$8.14 billion), while operating income soared 224.7 percent reaching ¥30.64 billion (US$280 million). Though net sales beat the 3Q16 results of ¥847.3 billion (US$7.74 billion), operating income in 3Q18 was still 35.5 percent below the ¥47.5 billion (US$430 million) reported in FY16.
Nine-month results also show gradually strengthening operations with net sales up 8.5 percent reaching ¥2.55 trillion (US$20 billion) and operating income of ¥107.1 billion (US$980 million), resulting in an increase of 5.1 percent. Net sales already compensate for the 7.8 percent reduction reported in 3Q17 but operating income still has a long way to go after the 41.2 percent decrease accounted in that same period.
According to the company’s financial presentation, global sales of 1.186 million units represented an increase of 2 percent compared to FY17, which was one of the main drivers for growth. The global roll out of Mazda’s new CX-5 and China’s strong results were among the main contributors to the company’s results. Sales also increased in Japan, Europe and the Rest of the World markets. Only North America reported weaker results with a 3 percent decrease due to a 5 percent contraction in the US market that could not be countered by an increase of 5 and 2 percent in Canada and Mexico, respectively.
After the positive results the company has seen through FY18, Mazda has revised its outlook for this fiscal year with sales of ¥3.5 trillion (US$30 billion), up 8.9 percent compared to FY17 and ¥150 billion (US$1.37 billion) more than in its forecast of April 2017. Though Mazda expects the same 1.6 million vehicles to be sold globally, the company has improved its expectations in the Chinese market and has a more conservative outlook for Japan and North America. The company still expects the same operating income of ¥150 billion (US$1.37 billion) – 19.3 percent more than in FY17 – but it has pumped its expectations for ordinary income to ¥170 billion (US$1.55 billion) from an initial forecast of ¥163 billion (US$1.49 billion).
The data used in this article was sourced from Mazda Motor Corporation. If you want to learn more about Mazda’s and other brands’ performance in Mexico, check out our feature analysis in Mexico Automotive Review 2017.