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Mazda Reports Fiscal Year 2008 Financial Results

May 11, 2009

FY2008 Consolidated Full Year Highlights:

  • Consolidated sales revenue was 2,535.9 billion yen and consolidated operating loss was 28.4 billion yen. Consolidated net loss was 71.5 billion yen, due to overseas affiliates' impairment losses and release of deferred tax assets.
  • Global sales volume was 1.261 million units, exceeding the full year sales projection announced in February by 21,000 units. This positive result was due to market share that has been improved or maintained in major markets because of a competitive product lineup.
  • Free cash flow (operating and investing activities) in the fourth quarter of FY2008 was positive 67.5 billion yen due to the progress made in optimizing inventory. 

FY2009 Forecast Highlights:

  • Consolidated sales revenue is expected to reach 2,030 billion yen, with a consolidated operating loss of 50 billion yen. Consolidated net loss is forecast to be 50 billion yen.
  • Global sales volume is projected to be 1.1 million units. Aim is to improve or maintain market share in major markets.
  • Reduce fixed costs by approximately 100 billion yen.
  • Focus on achieving positive free cash flow.
  • Forgo a year-end dividend in FY2008. FY2009 dividend is planned at 3 yen per share.  

HIROSHIMA, Japan-Mazda Motor Corporation today reported its financial results for fiscal year (FY) 2008 and announced its projections for FY2009. 

Mazda's consolidated sales revenue was 2,535.9 billion yen in FY2008, down 27 percent compared to FY2007. Mazda recorded an operating loss of 28.4 billion yen, reflecting the yen's appreciation against key currencies and a sharp deterioration in the global sales environment. Consolidated ordinary loss was 18.7 billion yen. Consolidated net loss was 71.5 billion yen, reflecting impairment losses of production facilities at overseas affiliates and increased tax expenses due to a partial release of deferred tax assets during the fiscal year. Free cash flow for FY2008 was negative 129.2 billion yen, but free cash flow in the fourth quarter was positive 67.5 billion yen, reflecting the progress achieved through inventory adjustment measures. 

Mazda's global retail volume in FY2008 was 1,261,000 units, due to a sharp downturn in the business environment that started in the second half of FY2008. 

In China, Mazda increased sales 33 percent year-on-year, to 135,000 units. Sales volume in Japan was 219,000 units, down 15 percent year-on-year, although the newly launched Mazda Biante and Mazda Atenza (known as Mazda6 overseas) models had a positive impact on sales. North American sales amounted to 347,000 units in FY2008, down 14 percent compared to the previous year. However, Mazda's market share in the US improved by 0.1 points, to 2.0 percent. Retail sales in Europe reached 322,000 units, down 2 percent compared to FY2007, though market share increased 0.2 points to 1.7 percent. 

In other global markets, combined total sales volume decreased 13 percent year-on-year to 238,000 units. In Australia, Mazda's largest market in this category, sales reached 77,000 units, with a record market share of 8 percent, up 0.5 points compared to the previous fiscal year. 

FY2009 Full Year Forecast

With challenging business conditions expected to continue from FY2008 into FY2009, Mazda forecasts its sales revenue to be 2,030 billion yen. Mazda projects an operating loss of 50 billion yen and a net loss of 50 billion yen. This outlook for an operating loss is based on continued weak demand which is anticipated for the first half of FY2009, and the residual impact of inventory adjustments. However, an operating profit is forecast in the second half of the fiscal year, due to expected full contributions from the all-new Mazda3, and gains from further cost reduction efforts. Mazda will also focus on achieving positive free cash flow during the fiscal year. Due to continuing weak demand in major markets which began in the second half of FY2008, global retail sales volume is projected to be 1.1 million units in FY2009, a year-on-year decrease of 161,000 units. However, Mazda aims to improve or maintain its market share in key markets. 

As a result of the deterioration in the operating environment, Mazda will forgo a year-end dividend in FY2008, and plans a dividend of 3 yen per share for FY2009. 

FY2009 Full Year Projections

 

FY2009 Projections

FY2008 Full Year Results

Y-O-Y Change

1st Half

2nd Half

Full Year

Sales revenue

930.0

billion yen

1,100.0 billion yen

2,030.0 billion yen

2,535.9 billion yen

(505.9)

billion yen

Operating profit/(loss)

(60.0)

billion yen

10.0

billion yen

(50.0) billion yen

(28.4)

billion yen

(21.6) billion yen

Ordinary profit/(loss)

(67.0)

 billion yen

7.0

billion yen

(60.0) billion yen

 (18.7)

billion yen

(41.3) billion yen

Profit/(loss) before tax

(69.0)

billion yen

4.0

billion yen

(65.0) billion yen

(51.3)

billion yen

(13.7) billion yen

Net income/(loss)

(50.0)

billion yen

0.0

billion yen

(50.0) billion yen

(71.5)

billion yen

21.5 billion yen

ROS

(6.5%)

0.9%

(2.5)%

(1.1)%

(1.4) Pts

EPS (yen/share)

(38.1) yen

0.0 yen

(38.1) yen

(52.1) yen

14.0 yen

Global retail volume

543,000 units

557,000 units

1,100,000 units

1,261,000 units

(161,000) units

Exchange rates

Yen / $US

95 yen

95 yen

95 yen

101 yen

(6) yen

Yen / Euro

125 yen

125 yen

125 yen

144 yen

(19) yen

                   

 

Dollar/Euro Equivalents

FY2008 Full Year Financial Results                                                     Unit: millions

 

Yen

US$

Euro

Sales revenue

 2,535,900

25,815.9

19,531.0

Operating profit/(loss)

(28,400)

(289.1)

(218.7)

Ordinary profit/(loss)

(18,700)

(190.4)

(144.0)

Profit before tax

(51,300)

(522.2)

(395.1)

Net income/(loss)

(71,500)

(727.9)

(550.7)

 

Notes:

-Dollar equivalents compiled at 98.23 yen to the dollar (Exchange rate prevailing on Mar. 31, 2009).

-Euro equivalents compiled at 129.84 yen to the Euro (Exchange rate prevailing on Mar. 31, 2009). 

Disclaimer
The projections for FY2009 and future outlook shown in this press release are based on various uncertainties including without limitation the conditions of the world economy in the future, automotive industry trends and the risk of exchange rate fluctuations. Please be aware that Mazda's actual performance may differ substantially from these projections. Please note that neither Mazda nor any third party providing information shall be responsible for any damage an individual may suffer due to investment in Mazda based on the information contained in this press release.

 

For additional financial information, please visit the Investor Relations section in the Mazda official website at www.mazda.com/investors/.


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