Suzuki Motor Corp. on Aug. 5 missed market expectations as it recorded a 53% decline in fiscal first-quarter net income due to lower output in Japan as it improves its testing processes and falling demand in India, its biggest market.
Despite the poor quarter, the Japanese carmaker affirmed its full fiscal year outlook of an 11.9% year-over-year rise in net income to ¥200 billion, or ¥433.54 per share. However, it added that the forecast was affirmed because "the outlook is unclear" at the moment and would revise forecast at a later date.
For the first fiscal quarter ended June 30, Suzuki's attributable net income was ¥40.51 billion, compared with ¥85.91 billion in the same period a year ago. The figure missed the S&P Global Market Intelligence consensus GAAP net income estimate of ¥44.05 billion.
Diluted EPS came in at ¥87.80, less than half of ¥187.65 last year. Operating income for the first fiscal quarter was ¥62.66 billion, plunging 46.2% from ¥116.46 billion a year prior.
Net sales during the three-month period fell 8.1% year over year to ¥907.53 billion from ¥987.47 billion due to the low production in Japan and weakened demand in India, Pakistan and Indonesia, and the impact of a stronger Japanese yen.
Sales of Suzuki automobiles fell 9.3% to ¥817.11 billion from ¥900.54 billion, which was partially offset by motorcycle sales that inched up 2% to ¥65.61 billion.
Suzuki announced a ¥37-per-share dividend for the fiscal second quarter and for the year end for a total annual dividend of ¥74, unchanged from the previous fiscal year.
Suzuki announced a revamp of its final testing process after being forced to recall vehicles and record extraordinary loss of ¥81.3 billion in fiscal year 2018 over concerns that some workers falsified inspection records over a period from 1981 until January 2019.
Suzuki's Indian arm, Maruti Suzuki India Ltd., saw fiscal first-quarter net profit plummet 27.3% year over year as net sales fell 14.1%.
Shares of the Japanese company fell as much as 3.55% to ¥3,858.00 in Tokyo trading before closing down 2.33% to ¥3,907 following the release of its earnings results.