Toyota has said that its annual net profit has declined by one quarter despite of record sales. The Japanese car maker blamed the decline on investment losses, but forecasts an increase next year.
The company said net profit declined by 24.5 percent at 1.88 trillion yen ($17 billion) 2018 which was their best result yet. They forecast net profit to rise 19.5 percent in the coming year to 2.25 trillion yen.
Toyota’s bottom line for the past year was pushed down by some 294 billion yen in book losses on its investment portfolio.
Sales rose 2.9 percent to a record 30.23 trillion yen in the last year, leaving an operating profit of 2.47 trillion yen, which was up 2.8 percent on-year.
For the current year to March 2020, Toyota expects operating profit will increase 3.3 percent to 2.55 trillion yen with sales forecast to sag 0.7 percent to 30 trillion yen.
Satoru Takada, an analyst at TIW, a Tokyo-based research and consulting firm, said “Toyota has cruised steadily, compared with its rivals.”
“The firm largely showed a reasonable performance around the world at a time when the global market is slowing down,” he said.
But Takada was not so optimistic about the outlook of the auto industry.
Japanese carmakers have enjoyed a heyday in recent years with the North American market steadily recovering from the financial crisis of the late 2000s and China growing into a mammoth market, he noted.
“But the outlook for the two biggest markets is now murky, while material costs are rising,” he said.
“Also, they can’t expect the one-time impact of US tax cuts, which temporarily boosted their profit before. Tough factors outnumbered positive ones,” he told AFP.