Suzuki Motor Corp. said Monday its group net profit slid 24.7 percent in the year ended March 31 to 20.25 billion yen due chiefly to shortfall-covering for retirement benefits reserves.
Suzuki, owned 20 percent by General Motors Corp., posted a 2.9 percent rise in consolidated pretax profit to 51.03 billion yen on a 5.2 percent rise in sales to 1.6 trillion yen.
Per-share group net profit dropped to 40.41 yen from the preceding year's 55.58 yen. But the company said it will keep its per-share dividend unchanged at 8.5 yen, including a special dividend of 1 yen per share. Suzuki said it posted an extraordinary loss of 10.77 billion yen to cover a shortfall in retirement benefits reserves under new accounting rules that stipulate company book shortfalls in retirement benefits reserves as liabilities to enable investors to assess their profitability more accurately.
Minicar deal extended
Mazda Motor Corp. and Suzuki Motor Corp. said Monday they have agreed to extend their original equipment manufacturing deal for Suzuki minivehicles sold under the Mazda name.
Suzuki has been supplying Mazda with six models under the OEM arrangement, but the new deal will also involve the development of next-generation minivehicles.
Suzuki began supplying Mazda with minivehicles in 1989.
The new accord has terminated speculation that Mazda may sever ties with Suzuki and strike a minivehicle deal with Daihatsu Motor Co., which is a Toyota Motor Corp. subsidiary.
Ford Motor Co. owns 33.4 percent of Mazda and is talking with Toyota about strengthening corporate ties.
Suzuki's popular Wagon R minivehicles are sold by Mazda as the AZ-Wagon, along with five other models bearing Mazda logos.
Minivehicles, defined as motor vehicles with engine capacities of up to 660cc, have enjoyed a dramatic surge in popularity since the introduction of new safety standards in 1998, under which their maximum length and width were expanded.