Isuzu Motors Limited announced on November 8, 2011 financial results for first half of financial year 2012 ending in March 2012 and its mid-term business plan for the period from April 2011 through March 2014. It has also revised FY2012 full-year forecast. (Financial results for 2012 H1)
In the second quarter of fiscal year 2012, whereas the world economy’s recovery slowed down, Isuzu steadily received orders from emerging markets chiefly in Asia and Japanese market. Under this situation, we worked hard to stabilize our production hampered by parts supply shortage in the aftermath of Great East Japan Earthquake and strived to recover our ability to fulfill requirements for production. However, due to another subsequent parts supply disruption, we are yet to fully meet orders from customers.
With respect to financial results for 2012 H1, sales revenue totaled 658.1 billion yen which is down 66.8 billion yen compared with the same period last year and fell short of 700.0 billion yen projected at the start of the fiscal year. In contrast, operating income came to 43.8 billion yen, a decrease of 3.0 billion yen year on year yet exceeds by far the original forecast of 30.0 billion yen because cost increase related to economic change such as steel price rise was not as steep as originally anticipated, reduction in material cost and efficiency gains on expenses made progress and Isuzu group companies chiefly among dealers in Japan performed better.
(FY2012 full-year outlook)
In spite of financial woes in Europe and slower pace of economic growth in China, orders for Isuzu products remain firm and steady. In the second half of FY2012, Isuzu will increase its production to fill outstanding orders from the first half, to ensure to meet growing demand in emerging economies and demand for reconstruction in disaster-stricken area in Japan.
Isuzu has revised its forecast of FY2012 full-year financial results as follows; sales revenue of 1430.0 billion, down 50.0 billion yen from previous announcement, operating income of 94.0 billion yen, up 14.0 billion yen, ordinary income of 95.0 billion yen, up 15.0 billion yen and net income of 74.0 billion yen, up 9.0 billion yen. This forecast derives from the fact that benefits of moderate trend in material cost increase and continued cost reduction achieved in the first half more than offset the negative impact from stronger yen.
Please note impact of flooding in Thailand was not taken into account for formulating the forecast as we are still assessing the situation. Isuzu plans to speedily release the result once it completed the assessment.
(Mid-term business plan (from April 2011 through March 2014))
Isuzu has developed a new mid-term business plan for the period from April 2011 through March 2014 whose centerpiece is “Three Global Core Business Organization” and the plan sets forth initiatives we will undertake to shift to this new business structure for its establishment in fiscal year 2016. The envisioned “Three Global Core Business Organization” involves addition of new core business of commercial vehicle business in emerging markets to two traditional core businesses of commercial vehicle business in Japan and light commercial vehicle (pickup truck and its derivatives) business in Thailand.
Isuzu puts forth in the business plan its direction towards achieving excellence in areas of environmental friendliness that is a demand from society and of ” minimum down time and minimum life-cycle costs” that is customer needs and requirement. Under this plan, Isuzu will deliver “eco-friendly products” and “products best suited for emerging markets “ and will concurrently implement growth strategy in emerging economies whereas keeping sustainable operations in advanced countries as well.
I appreciate your further understanding and support to Isuzu Motors Limited in the future.
