Our Financial Results
We have announced the financial results for the third quarter of the fiscal year ending in March 2025.
Unfortunately, Japanese automakers' sales in Japan for the October–December period were down 4% year-on-year, showing continued sluggish sales despite hopes that sales would rebound following the certification problem with cars they produced.
Meanwhile, Japanese car sales in China fell by as much as 17% although there was a slight recovery from the first half of the year.
However, these negatives were offset by strong sales in North America, up 6% year-on-year, and overall results were in line with expectations. Our earnings also made steady progress, with both sales and operating profit for the third quarter improving significantly compared to the first half of the year as a result of the full shipment of our products to a new major customer in North America starting in October as planned.
The exchange rate at the end of December was 158 yen to the dollar, making the yen much weaker than expected and leading to foreign exchange gains. However, the peso also weakened more than expected against the dollar, resulting in a foreign exchange loss and a loss on the translation of deferred tax assets into dollars, the sum of which offset the foreign exchange gain from the weaker yen.
As a result, the downward impact on ordinary profit and net profit due to foreign exchange conversion was within the scope of the previous forecast.
The second Trump administration has been inaugurated, and many executive orders are being issued. However, the full picture of the tariff and foreign exchange policies is still unclear, and it is not possible for us to foresee the impact of these policies. Accordingly, we assume that the yen-dollar exchange rate will return to the level of yen appreciation that was assumed for October, which is unfavorable for our company.
We also assume that the peso-dollar exchange rate will continue to weaken from its level at the end of December, which is also unfavorable for our company.
Based on these exchange rate assumptions, we have made our earnings forecast for the fourth quarter and have, therefore, left the full-year earnings forecast unchanged.
This is the report on the financial results for the third quarter of this fiscal year. We would like to ask our shareholders for their continued understanding and support in the days ahead.