Japan's Mazda Motor Corp said on October 30 it beat expectations in the first half on strong car sales in China and Europe but it cut its full-year profit estimates as the economic crisis clouds the picture.
Japan's fifth-largest automaker, whose biggest shareholder is struggling US automaker Ford Motor Co, said it was hit like other Japanese companies by a soaring yen and high raw material costs.
The Hiroshima-based company said that its net profit rose two percent year-on-year to 29.5 billion yen (284.7 million dollars) in the six months through September. Operating profit slipped 17 percent to 60.7 billion yen, although it was more than one-fifth higher than what Mazda had anticipated.
Mazda sold six percent more vehicles around the world in the half, although sales revenue was down five percent at 1.58 trillion yen due to a stronger yen and a change in accounting standards.
Sales soared by more than half in China and 17 percent in Europe thanks to a new line-up. Sales slipped in the United States, although Mazda's market share in the slowing market improved thanks to the popularity of its small cars. Mazda "beat our initial first-half operating profit forecast, announced at the beginning of the fiscal year," said David Friedman, the chief financial officer.
"However, we expect the third quarter and onward to present a challenging business environment," he said in a statement.
Mazda said it now expected to earn 50 billion yen in net profit for the year, a reduction from an earlier 70 billion yen forecast and down 46 percent from the previous year. It also cut its operating profit forecast to 90 billion yen from 115.0 billion yen. But it left its revenue estimate unchanged at three trillion yen.