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NINJAS BEAT COVID

Thanks to a combination of luck and good management, the Kawasaki Heavy Industries motorcycle and engine division prospered during its full fiscal year to 31 March 2021 — versus an unavoidably deleterious parallel background of the pandemic. BDN financial editor Roger Willis reports.

Total 12-monthly divisional revenue fell by just 0.3% to £2.19bn, attributed principally to Covid’s impact in the first quarter. Turnover from motorcycles was 7.2% down to £743m in developed countries and 14.2% lower at £438m in emerging markets. 

But powersport products mainly sold in North America — off-road vehicles, quadbikes and personal watercraft — yielded a 19.9% revenue boost to £659m. And sales of general-purpose petrol engines improved by 4.3%  to £348m.

Kawasaki had initially forecast an emaciated operating profit of £33m, against a loss of £12m in the previous fiscal year. However, a rigorous attack on operating expenses cut fixed costs by £68m. So the eventual outcome was a £76m profit.

During the year, Team Green’s wholesale motorcycle shipment volume into the developed world declined by 9.9% to 146,000 machines. Europe was most seriously affected, 21.6% down to 58,000. The US dropped by just 1.8% to 54,000. Japan and Canada respectively retreated by 15.8% to 16,000 and 16.7% to 5000. Shipments to Australia, on the other hand, grew by 83.3% to 11,000.

Emerging markets took harsher punishment, diving by 32.9% to 226,000 overall. Within that, the Philippines plunged by 40.4% to 143,000, Indonesia sank by 41.2% to 30,000 and China lost 7.4% at 25,000.

On a retail basis, Kawasaki said its European motorcycle sales recovered to the same level as the previous year and improved in the USA due to rising demand for both motorcycles and off-road vehicles. But South-East Asia remained “sluggish”.

Prospects for the new fiscal year through to March 2022 are upbeat. The division predicts an ongoing increase in demand for motorcycles and ORVs. And it has forecast revenue climbing by 12.9% to £2.47bn and operating profit 45.3% up to £111m.          

[Yen-sterling currency translation at forex rates applicable on 11 May 2021]

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