Yamaha: Business Conditions Worrisome

admin
Japan's Yamaha Motor Co., Ltd. says business conditions surrounding the company "remain worrisome, amid a worldwide economic slowdown resulting mainly from the worsening financial crisis in the United States, and high crude oil and raw material prices."

The OEM says factors likely to impact its profitability this year include shrinking demand in advanced nations; soaring raw material prices; and adjustments — decline — in production of mainstay products for export to advanced nations.

First Half Results
Yamaha says net sales for the first half-year, ended June 30, decreased 6.6 percent from the same period of the previous year, to ¥869.1 billion ($7.93 billion).

Motorcycle sales decreased 1.1 percent from the same period of previous year, to ¥561.9 billion ($5.13 billion), due to reduced sales in Europe, the United States and Japan; Marine product sales declined 13.1 percent, to ¥143.2 billion ($1.31 billion), reflecting sluggish outboard motor and personal watercraft sales in the U.S.; and Power product sales fell 21.5 percent, to ¥97.5 billion ($889.99 million), due to a sales decline for ATVs and other products in the U.S.

"In the U.S., sales of outboard motors, ATVs and SxSs decreased, as negative factors including high crude oil prices and a slowing economy diminished demand," Yamaha said.

Yamaha motorcycle sales in North America during the first half of 2008 totaled 91,000 units, down from 117,000 units during the first six months of 2007. "Motorcycle sales in the U.S. also declined, due to an inventory reduction in response to the economic slowdown," the company said.

Outlook
Yamaha says it expects demand for motorcycles in Japan and Europe to decrease in 2008, sales in North America to remain about the same as 2007, and sales in Asia to continue a mild expansion.

The company also forecasts decreased ATV and outboard motor sales in the U.S. and Europe.

Figures above are calculated at an exchange of one U.S. dollar to 109.590 yen. On the foreign exchange front, the average purchasing value of the yen against the U.S. dollar during the first six months of the year appreciated by ten yen from the same period of the previous year, to 106 yen.