Yamaha has admitted that its struggling motorcycle operations in developed markets have already reduced group profit in the nine months of its current fiscal year to date and will have a further impact on full-year revenue and profit. BDN financial editor Roger Willis reports.
Three-quarterly bike revenue fell by 1.5% to £5.241bn. Turnover from emerging markets increased by 0.7% to £3.984bn. But that progress was scuppered by developed-world problems. Sales in Europe, by far the biggest constituent, sank by 7.6% to £727m. North America was 5.3% down to £254m. Japan dropped by 13.4% to £212m. Australia and New Zealand were 5.1% lower at £64m. Overall, that averaged an 8.1% decline at £1.257bn.
So while emerging countries led by South-East Asian input achieved a 3.5% rise in associated operating profit contribution to £380m, developed regions turned a thin profit of £3m in the equivalent period of last year into an operating loss of £72m this time round. Consequently, Yamaha’s motorcycle business operating profit declined by 16.9% to £308m. (Its marine business, which had a much smaller turnover of £1.826bn, made £361m…)
At group level, revenue rose slightly by 0.9% to £8.587bn. Operating profit was 4.4% down to £786m and net profit fell by 8.3% to £557m.
Reacting to this motorcycling grief, Yamaha says structural reforms are being put in place and it is concentrating on development of more competitive models. But the company has also revised its full-year 2018 forecast downwards. Annual revenue is now predicted to be about 1% lower at £11.2bn, operating profit should sink by around 5% to £970m and net profit will lose 6% to £650m.  Â
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