After Solid Fiscal 2018 Results, Toyota Gave Dismal 2019 Guidance



Toyota’s fiscal 2018 earnings

Toyota Motor Corporation (TM) released its fiscal 2018 (April 1, 2017–March 31, 2018) earnings report today before the market opened. The company’s adjusted EPS (earnings per share) for the fiscal year increased 39% YoY (year-over-year) to 842 Japanese yen or ~$7.67. The company reported a 20% YoY jump in its operating profit to 2.4 trillion yen or about $21.9 billion. Toyota’s operating margin expanded to 8.2%, compared to 7.2% in the previous fiscal year.

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Other key highlights

In fiscal 2018, Toyota’s consolidated vehicle sales fell 0.1% to 8.96 million units from 8.97 million units a year ago. Despite this marginal stagnation, the company reported a 6.5% YoY increase in its net revenue to 29.4 trillion yen or ~$268 billion.

Higher expenses related to market activities hurt Toyota’s operating profits in the North America segment. On the positive side, the company’s operating profits in Europe and Asia befitted from cost reduction efforts.

In fiscal 2019, Toyota’s management expects consolidated vehicle sales to fall 0.2% YoY. Similarly, the company guided for its fiscal 2019 revenues and operating income to drop 1.3% and 4.3% YoY, respectively. According to TM’s guidance, continued strength in the Japanese yen could be the biggest negative factor affecting its profits in fiscal 2019.

Auto Industry’s 1Q18 earnings season

In the last couple of weeks, mainstream auto companies (VCR) Ford (F), General Motors (GM), and Fiat Chrysler (FCAU) announced their 1Q18 earnings results. On May 2, the popular US electric carmaker Tesla (TSLA) released its first-quarter results. Visit our Autos page for reviews of these auto companies’ 1Q18 earnings reports.

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