Toyota Motor Corp posted a 32 percent jump in first-quarter operating profit on Tuesday as powerful sales abroad helped the maker of the Lexus luxury brand and Prius hybrid cars offset losses from a weaker dollar.
With demand growing at a faster clip than expected, Toyota, which last year overtook Ford Motor Co as the world's biggest car seller behind General Motors Corp, raised its full-year global sales forecast, boding well for earnings.
"First-quarter profits exceeded expectations thanks to better-than-anticipated sales in North America," said J.P. Morgan analyst Eiji Kawahara. "It should be easy for Toyota to build on last year's profits."
Toyota restated what it said in May, that its aim is simply to match last year's record profits, which were lifted by a one-off pension-related gain of 100 billion yen ($902 million).
Toyota, which became the first Japanese company to earn a net 1 trillion yen ($9 billion) in the year ended March 31, is cruising ahead of rivals thanks to an abundance of new products, cutting-edge technology and cost-cutting expertise.
Profits rose in every region in April-June as it stayed on track to slash annual costs by $1.8 billion. Toyota is already far more efficient than most rivals, having earned $1,570 for every car it sold last year, against around $440 for GM.
Operating profit at Toyota, the world's most valuable auto maker with a market capitalisation of $143 billion, was 448.62 billion yen ($4.05 billion) for the quarter compared with 340.77 billion yen in the year-earlier period.
Net profit rose 29 percent to 286.62 billion yen as sales climbed 10.2 percent to 4.510 trillion yen.
A 9 yen fall in the dollar to 110 yen for the quarter helped shave 70 billion yen from profits, but the exchange rate was better than its 105 yen assumption for the year to March 2005.
Toyota kept its exchange rate assumptions unchanged for the year, also expecting the euro to average 125 yen.
Firm overseas sales also helped Japanese rivals Nissan Motor Co and Honda Motor Co raise profits in the quarter, but to a lesser degree.
Given the faster-than-expected sales growth, Toyota raised its 2004/05 global sales forecast by 2.6 percent to 7.2 million vehicles for the group, which includes mini-car unit Daihatsu Motor Co and truck maker Hino Motors Ltd.
Both Daihatsu and Hino are picking up sales in the wake of a free-fall in demand for vehicles made by Mitsubishi Motors Corp, which has been mired in a recall scandal.
Toyota is set to continue its assault with more product launches.
Among them will be the addition of more hybrid-powered vehicles, which switch between gasoline and electric power, in the key US market in the next six months - including the RX400h sport utility vehicle (SUV) from the Lexus brand - as it hopes to repeat the success of the remodelled Prius car.
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