Hino Motors
Hino Motors is in the midst of a fraudulent application for engine certification. The financial results for the second quarter of the fiscal year ending March 2023 were tough, with net income down 70% year-on-year.
The financial results for the second quarter of the fiscal year ending March 2023, announced on October 27, showed sales of 733.4 billion yen (up 6.4% year-on-year) and operating income of 16.6 billion yen (down 47.8% year-on-year). Net income decreased by 70% to 3.5 billion yen.
Together,The company also announced that it would revise its full-year operating profit forecast to 6 billion yen, down 82% year-on-year.However, it decided not to disclose the final profit and loss because it is difficult to calculate.
In this year’s financial results, a total of approximately 4.6 billion yen in extraordinary losses was recorded as recall costs and compensation losses for suppliers, etc., related to the engine certification falsification issue.
How have you been affected by the engine certification application issue and the yen’s depreciation? Let’s read the points from the financial results briefing materials.
Domestic sales volume for shipment suspension “30% decrease”, overall flat
Year-on-year changes in sales volume. Domestic sales decreased significantly, but overseas sales recovered and the number of units sold remained almost unchanged. Please note that the figures are different from the summary of financial results because the counting method is different.
First of all, looking at sales volume by region, while domestic sales volume has decreased by about 30%, sales volume has increased especially in Asia and North America. As a result, global (overall) sales volume remained almost flat compared to the same period of the previous year.
One of the reasons for the “significant decrease in sales” in Japan is, of course, the suspension of shipments due to improper engine certification.
However, according to the financial results brief, in addition to that”Supply stagnated due to delays in vehicle production due to global shortage of semiconductors”or“Sluggish tourism demand due to the impact of the new coronavirus”The contraction of the bus market caused by this is also a factor in the decline in sales.
As a result, Hino Motors’ domestic shipments were 18,600 units, down 10,600 units from the same period last year (the figures are from the financial results).
Overseas sales recovered. In particular, the number of units sold in Indonesia has grown tremendously. In North America as well, there was a significant recovery compared to the previous year due to the resumption of production at plants that had been suspended.
The overseas business is on a recovery trend, mainly in ASEAN countries such as Indonesia and Thailand. In North America as well, production and sales at plants that had been suspended since the end of 2020 resumed in the second half of FY2021, and sales of heavy- and medium-duty trucks recovered significantly compared to the same period of the previous year.
Overseas sales totaled 55,800 units, an increase of 11,000 units from the same period last year.
Engine rumbles.Strong overseas sales, net profit down 70% despite yen depreciation
Sales in the first half remained flat, but net income decreased by 70%.
Sales in the first half of the year were almost unchanged from the previous year and increased slightly, probably because the overall sales volume did not decrease that much. On the other hand, operating profit was almost halved to 16.6 billion yen.
Factors behind the decline in operating income were delays in supply due to certification issues and delays in parts procurement.according toDecrease in domestic sales volumeI think it was a big deal. In addition, although the yen’s depreciation had positive aspects in terms of overseas sales, material costs soared, resulting in a large impairment loss overall.
In the interim financial results, the full-year earnings forecast, which was undecided in the first quarter financial results on July 28, was calculated based on the information on the models for which shipments have been approved at the moment.Net sales are almost flat from the previous year at 1.53 trillion yen, while operating income is down 80% to 6 billion yen.announced that it would become
Earnings forecast for the full year. Operating profit is expected to decline by 80% to 6 billion yen.
The outlook for ordinary income and net income remains undetermined due to the difficulty in calculating losses related to the certification fraud issue.
In the financial statements,
“Regarding the impact of the certification issue on engines for the North American and Japanese markets, the investigation by the Special Investigation Committee for engines for the Japanese market has been completed, but at present, some verifications, investigations, and communication with related parties are continuing. It is difficult to reasonably estimate the amount of impact other than the amount that has already been clarified.”
and
Class action lawsuits have been filed against Hino Motors in Florida, USA and Victoria, Australia. Although the specific amount of damages claimed has not been clarified, at least the US lawsuit states that the amount claimed exceeds $ 5 million (about 730 million yen).
(Text by Takashi Mitsumura)
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