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TOYOTA EARNINGS UP: SUCCESS FROM LOW YEN

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Toyota earnings up 2014 on STOCK.com

TOYOTA EARNINGS UP: SUCCESS FROM LOW YEN

Nov 6 2014, 10.58am GMT

Stock.com

Toyota’s latest earnings show a massive jump in Foreign exchange gain in the last 3 months, benefitting from the low yen and high US exports.

Toyota FY2015 Second Quarter earnings (April 1, 2014 through September 30, 2014)

Over the last year, Japanese car manufacturer Toyota has seen a rise of revenue by 4.3% to 6.554 trillion yen ($59.9 billion). However, with global sales of 2.24 million units essentially flat from the previous year’s period, a scan of the income list shows the largest climb is in Foreign exchange income: In the last 6 months, it has risen from ¥16,724m to ¥64,161m, a difference of ¥47,437m but the majority of that income was made in the last quarter, in fact ¥43,929m.

Two elements have contrived to give Toyota this success; the first is that the yen has been on a downward spiral against the dollar, with JPY at its lowest level against USD since 2007, but with the latest announcement from Bank of Japan bringing in quantitative easing, the yen may have a rescue plan. The second is that Toyota specifically made high return from North America. As the Toyota statement recorded, “Net revenues in North America increased by 431.7 billion yen, or 10.6%, to 4,499.7 billion yen in FY2015 first half compared with FY2014 first half, and operating income increased by 150.3 billion yen, or 92.6%, to 312.6 billion yen in FY2015 first half compared with FY2014 first half. The increase in operating income was mainly due to increases in both production volume and vehicle unit sales and the recording of valuation gains on interest rate swaps stated at fair value in sales finance subsidiaries.” Notably, U.S. sales of Lexus SUVs are up 13% this year.

At the same time the car giant also reported on their home market, “Net revenues in Japan decreased by 92.9 billion yen, or 1.3%, to 6,850.8 billion yen in FY2015 first half compared with FY2014 first half, and operating income decreased by 111.2 billion yen, or 13.4%, to 718.7 billion yen in FY2015 first half compared with FY2014 first half.”

Other markets for Toyota were reported as follow:

Net revenues in Europe increased by 62.8 billion yen, or 4.8%, to 1,365.8 billion yen in FY2015 first half compared with FY2014 first half, and operating income increased by 7.7 billion yen, or 30.7%, to 33.2 billion yen in FY2015 first half compared with FY2014 first half.

Net revenues in Asia decreased by 17.2 billion yen, or 0.7%, to 2,382.6 billion yen in FY2015 first half compared with FY2014 first half. However, operating income increased by 17.2 billion yen, or 8.8%, to 212.9 billion yen in FY2015 first half compared with FY2014 first half. The increase in operating income was mainly due to the effects of changes in exchange rates and cost reduction efforts.

Net revenues in other regions, Central and South America, Oceania, Africa and the Middle East, increased by 13.8 billion yen, or 1.2%, to 1,206.0 billion yen in FY2015 first half compared with FY2014 first half, and operating income increased by 1.8 billion yen, or 2.4%, to 77.9 billion yen in FY2015 first half compared with FY2014 first half.

Segment Operating Results

Net revenues for the automotive operations increased by 313.9 billion yen, or 2.7%, to 11,947.2 billion yen in FY2015 first half compared with FY2014 first half, and operating income increased by 32.2 billion yen, or 2.9%, to 1,140.2 billion yen in FY2015 first half compared with FY2014 first half. The increase in operating income was mainly due to cost reduction efforts and the effects of changes in exchange rates.

Net revenues for the financial services operations increased by 89.7 billion yen, or 13.0%, to 777.3 billion yen in FY2015 first half compared with FY2014 first half, and operating income increased by 51.2 billion yen, or 38.4%, to 184.5 billion yen in FY2015 first half compared with FY2014 first half. The increase in operating income was mainly due to the recording of valuation gains on interest rate swaps stated at fair value in sales finance subsidiaries.

Net revenues for all other businesses increased by 47.1 billion yen, or 9.3%, to 555.2 billion yen in FY2015 first half compared with FY2014 first half, and operating income increased by 8.0 billion yen, or 39.8%, to 28.4 billion yen in FY2015 first half compared with FY2014 first half.

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