Yamaha Motor sees another profit record in 2005

Japan's Yamaha Motor Co said on Tuesday it expected a record operating profit in 2005 for the fifth consecutive year, banking on a further acceleration in south-east Asian motorbike demand. The world's second-largest motorcycle maker forecast operating profit of 90 billion yen ($858 million) this year as sales sizzle in Indonesia, Thailand and Vietnam, where large parts of the populations use motorcycles daily.
Yamaha Motor, which earns almost 90 percent of its revenues overseas, has said it expects its global shipments to rise nearly 15 percent this year, with shipments to those three countries alone rising 31 percent.
Robust motorbike sales in southeast Asia will offset a sluggish performance at home and in its other divisions such as marine products. It sees its revenues increasing to 1.23 trillion yen in 2005.
"There are risk factors such as high oil prices and the strong yen," Yutaka Kume, Yamaha Motor's finance and logistics division manager told a news conference. "But we do see demand in Asian countries continuing to be stronger than the previous year."
The profit forecast for this year exceeded a consensus projection of 88.14 billion yen by eight analysts polled by Reuters Estimates.
To meet growing motorcycle demand, Yamaha Motor has invested aggressively in south-east Asia. With two plants to start operating next year, it has said it will be able to expand its model line-up by 25 percent world-wide in the next three years.
"The company's earnings were very good as expected, and I believe the firm will grow steadily as it forecasts itself," said analyst Koji Endo at Credit Suisse First Boston.
"Yamaha has been showing better profitability than Honda, even though its business runs on a smaller scale," he said.
Honda Motor Co Ltd is the world's leading motorcycle maker. Announcing its mid-term business plan, Yamaha Motor said in January it aims to ship 4.55 million motorbikes world-wide by 2007, up 44 percent from its 2004 level, while it sees slower 14 percent rise in the overall global demand in the same period.
It also said it targets a rise in operating profit of 36 percent in the next three years and would increase dividend payments to 22 yen. Its dividend is forecast at 17 yen for the 2005 business year.