Isuzu Motors Ltd. said Monday its group net profit increased 56.7 percent in fiscal 2006 from the previous year to a record 92.39 billion yen, backed by growing demand for its trucks overseas.
In the business year through March, its consolidated operating profit hit an all-time high for the fourth straight year, totaling 106.98 billion yen, up 18 percent, on a 5.1 percent rise in sales of 1.66 trillion yen.
The Tokyo-based manufacturer, which ended a 35-year-old capital tieup with General Motors Corp. and formed a capital and business partnership with Toyota Motor Corp. last year, said its overseas vehicle sales rose 6.7 percent to 371,500 units, helped by an improvement in its dealer networks and an increase in sales of light-duty trucks in the Middle East and South America.
Its total vehicle sales grew 4.9 percent to 468,301 units, of which 96,801 were sold in the Japanese market, down 1.4 percent from a year ago.
Isuzu plans to raise its dividend for fiscal 2006 to 4 yen per share from 3 yen in the previous year, and 5 yen per share for the current year.
“I’m delighted to report that the company has achieved record profits on the last occasion that I will announce earnings figures,” said Isuzu President Yoshinori Ida, who is to be replaced by Executive Vice President Susumu Hosoi in June.
Ida has saved the truck maker from financial difficulties since taking the helm in 2000.
For the current business year, Isuzu expects to see 80 billion yen in group net profit, down 13.4 percent from fiscal 2006, and 100 billion yen in operating profit, down 6.5 percent, on 1.65 trillion yen in sales, down 0.8 percent.
“We anticipate continued strong demand for trucks in areas with rich natural resources such as the Middle East, Central and South America, and Africa,” Hosoi said at a news conference with Ida in Tokyo, adding that the domestic market is expected to be weak for some years.
Hosoi said Isuzu expects 64 percent of its total sales in fiscal 2007 to be generated overseas, up from 53 percent in the previous year.
Isuzu said it will release a new midterm business plan in July, which is likely to include its strategy for the joint development with Toyota of “the world’s No. 1” new small diesel engine.
Asked about the progress of the engine development with Toyota, Hosoi said, “It is going very smoothly. Engineers of the two companies have nearly reached a consensus on what kind of new engine to make.”
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