- US hiring soars past expectations in sign of resilient market
- As EU targets Chinese cars, European rivals sputter
- Top EU court finds against FIFA in key transfer market ruling
- Oil extends gains, Hong Kong stocks resume rally
- 'A man provides': Ukrainian miners send families away as Russia advances
- EU states greenlight extra tariffs on EVs from China
- Hong Kong stocks resume rally, oil dips after Middle East-fuelled surge
- Crude stable after Israel-Iran surge, Hong Kong stocks resume gains
- Hera spacecraft to probe asteroid deflected by defence test
- US dockworkers to head back to work after tentative deal
- After Helene's destruction, North Carolina starts to rebuild
- Dockers end three-day strike at Montreal port
- What next for OpenAI after $157 billion bonanza?
- Israel-Hamas war causes 86-percent dive in Gaza GDP: IMF
- Milan's Morata moves house after Inter-fan town mayor 'violates' privacy
- 'Devastating' storm hits Augusta National but Masters will go on
- Relief in Brazil, Asia over delay to EU deforestation rules
- Oil prices jump, stocks fall on Middle East tensions
- Biden says 'discussing' possible Israeli strikes on Iran oil facilities
- Oil prices rise, stocks fall on Middle East tensions
- Oil rallies, stocks mostly retreat on Middle East tensions
- Phasing out teen smoking could save 1.2 mn lives: study
- 'Welcome relief': Asia producers hail EU deforestation law delay
- Japan PM slated to announce plans for 'happiness index'
- Turkish inflation falls less than expected in September at 49.4%
- Easing inflation lifts profit at UK supermarket Tesco
- Skiing calls on UN climate science to combat melting future
- China wine industry looks to breed climate resilience
- Tokyo rallies on weak yen, Hong Kong drops after surge
- Dutch airline KLM unveils 'firm' cost-cutting measures
- Carpe diem: the Costa Rican women turning fish into fashion
- Senegal looks to aquaculture as fish stocks dwindle
- Will AI one day win a Nobel Prize?
- Climate change, economics muddy West's drive to curb Chinese EVs
- Argentina's Milei vetoes university budget after huge protests
- TotalEnergies plans to grow oil and gas production until 2030
- 2024 Nobels offer glimmer of hope as global crises mount
- Tokyo rallies on weak yen, Hong Kong reverses after surge
- Tunisia readies for vote as incumbent Saied eyes victory
- High childcare costs in US weigh on women's employment
- US voters seek help with crushing childcare costs
- Taiwan shuts down for second day as Typhoon Krathon to land
- Supercharged storms: how climate change amplifies cyclones
- Biden official urges talks as US port strike enters second day
- Huge protests in Argentina over public university cuts
- Rally in oil prices loses steam on mixed day for global stocks
- South America treated to rare 'ring of fire' eclipse
- Biden official says port strike deal not as far as parties think
- Mexico's new president offers apology for 1968 student massacre
- Historic funding round values OpenAI at $157 billion
RBGPF | 100% | 58.93 | $ | |
CMSC | -0.16% | 24.74 | $ | |
CMSD | -0.16% | 24.89 | $ | |
SCS | -1.98% | 12.62 | $ | |
BCC | -0.9% | 138.29 | $ | |
GSK | -2.81% | 38.37 | $ | |
AZN | -2.12% | 77.93 | $ | |
RIO | -1.42% | 69.83 | $ | |
BTI | -2.45% | 35.11 | $ | |
NGG | -2.7% | 66.97 | $ | |
RYCEF | 1.15% | 6.98 | $ | |
RELX | -1.46% | 46.61 | $ | |
BCE | -1.77% | 33.84 | $ | |
JRI | -0.6% | 13.3 | $ | |
VOD | -0.52% | 9.69 | $ | |
BP | 0.28% | 32.46 | $ |
Toyota upgrades forecast even as Q1 net profit slumps
Toyota upgraded its annual net profit forecast on Thursday, predicting an earnings boost from the weaker yen even after first-quarter net profit took a hit from pandemic-related supply chain issues.
The global chip shortage, Covid-19 lockdowns disrupting Chinese factory output and Russia's invasion of Ukraine are all weighing heavily on the auto industry.
But Japanese companies like Toyota selling products overseas have also benefited from a cheaper yen, which has hit 24-year lows against the dollar in recent months.
The world's top-selling automaker now forecasts an annual net profit of 2.36 trillion yen ($17.6 billion) -- up from its previous estimate of 2.26 trillion yen, but still a drop of 17 percent compared with last year's record results.
For the three months to June, the auto titan said net profit fell 17.9 percent on-year to 736.8 billion yen.
"Despite the positive foreign exchange effects from the weaker yen, the large impact from lower sales volume due to supply constraints and higher raw materials prices led to a decrease in operating income" in the first quarter, the company said.
Meanwhile, "the revision of foreign exchange rate assumptions had a positive impact on the operating income forecast", it said.
Revisions to the predicted impact of "soaring materials prices" and cost-reduction efforts would also cause operating income to decrease this financial year, Toyota added.
Buoyed in part by the weaker yen, Toyota in May logged a record full-year net profit of 2.85 trillion yen for 2021-22.
The focus will now be on whether the company can keep its global production target of 9.7 million units for this financial year in light of the parts shortage, said Satoru Takada, auto analyst at research and consulting firm TIW.
Three big automakers in Japan -- Toyota, Nissan and Honda -- have been "unable to sufficiently recover production" to meet consumer demand, Takada told AFP.
However, Toyota has so far largely escaped the worst of the crises, he said, adding that the company has "customers waiting for its cars thanks to strong demand".
The firm built stronger ties with domestic suppliers after Japan's 2011 earthquake and tsunami, which analysts say helped it weather a pandemic-triggered shortage of semiconductors -- an essential component of modern cars -- better than its rivals.
But it has been forced to repeatedly adjust production targets because of the chip shortage and pandemic-linked factory closures.
Adding to the problems is uncertainty arising from Moscow's war in Ukraine. Toyota said in March it would halt operations at its only factory in Russia, and stop shipping vehicles to the country.
Ahead of the earnings announcement, SC Capital called Toyota's annual outlook "the most low-balled in the industry", predicting a sharp upwards revision later this year as semiconductor supplies become more abundant.
"Toyota's first quarter... is expected to be bad. But consensus is way too low for the rest of the year, as supply constraints from Shanghai will subside from the second quarter and chip inventory rises more than expected," SC Capital said in a SmartKarma commentary.
"Anyone who's spoken with the company knows that the second quarter will see a V-shaped recovery and an upward revision for the full fiscal year."
Y.Jeong--CPN