Yen Weakness Spreads Its Benefits
Mazda Motor Corp reported a global net profit of 34.3 billion yen ($364.3 million) in the year ended March 31, its first black numbers for five years, although it still lost money in the U.S.
Global net and operating profit will double in the current financial year, Mazda said.
Mazda, which produces most of its cars in Japan, was benefitting from the yen’s weakness.
“The move from 78 to 100 yen (to the dollar) is worth as much as $4,000 a unit or more for more export-oriented Japanese players like Mazda and (Subaru maker) Fuji Heavy, said Morgan Stanley analyst Adam Jonas.
Deutsche Bank said it was time to buy Mazda shares.
“After suffering through over five years of appreciating, the rapid depreciation of the yen has restored a level playing field for the Japanese majors. Having capacity, R&D capability, and suppliers in Japan is no longer a handicap. We continue to see Toyota as having the most to gain. We have monitored Mazda for a good fundamental entry point and we believe recent underperformance has provided one. We upgrade to buy,” said Deutsche Bank analyst Kurt Sanger.
The U.S. loss amounted to $519.1 million, but Mazda said it would be in the black there this year.
European sales will jump 17 per cent this year to 200,000 vehicles, Mazda said.
Deutsche Bank said CX-5 SUV and Mazda 6 saloon sales will continue to grow through the second half. The new Mazda 3 starts production this month, but sales don’t start until the fourth quarter.
Neil Winton – May 15, 2013
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