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TEAM GREEN DEEPER INTO THE RED

After losing money throughout its previous fiscal year, the motorcycle and engine division of Kawasaki Heavy Industries had been shrouded in gloom before the pandemic became a handy excuse. So Covid-19 could only be blamed for making matters worse in latest first-quarter results. BDN financial editor Roger Willis reports.

Total three-monthly revenue to the end of June 2020 was 13.8% down to £424.6m. An operating loss of £42.5m had more than doubled from the £20.2m Q1 loss last year. 

Higher-value wholesale bike shipments to developed countries were only 3.3% lower at 29,000, but associated turnover fell by 5.7% to £177.8m. Shrinking sales in Europe and adverse foreign currency translation carried the can for that.

Coronavirus impact was obviously held responsible in emerging markets across Asia, where motorcycle sales volume slumped by 63.8% to 25,000. Related revenue plunged by 44.5% to £65.7m.

Utility vehicles, ATVs and personal watercraft, principally aimed at the US market, put on 18.2% to 13,000 units, while revenue from that direction grew by 23.8% to     £119.7m. But revenue from general-purpose petrol engines sank by 31.5% to £61.3m.

The divisional full-year forecast is very much Team Red rather than Green. Predicted revenue will be 17.1% down to £2.017bn, accompanied by an operating loss estimate of £122.5m. 

 

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