Yamaha Motor Co., Ltd. (Tokyo: 7272) announces its consolidated business results for the full 2023 fiscal year.
From HIDAKA, Yoshihiro
President, Chief Executive Officer and Representative Director
I am happy to report that in fiscal 2023, we set new records for consolidated net sales and operating income. As demand for outdoor recreation slowed, primarily in developed markets, it remained strong for our core products of motorcycles and large outboard motors. Also, our efforts to counter rising costs by passing on prices and the weak yen contributed to us posting higher sales and profits.
Our consolidated business results forecast for 2024 per International Financial Reporting Standards (IFRS) is revenue of 2,600.0 billion yen and an operating income of 260.0 billion yen (operating income ratio of 10.0%), goals representing another resetting of our revenue and operating income records. We expect to see improved supply of premium motorcycle and scooter models in emerging markets, the launch of a new large outboard motor model in the Marine Products business, and for solid demand in Asian markets to reinforce our operations. The Robotics business will work to stage a recovery in demand in the second half of the fiscal year. As a result of these developments, we expect to clear the financial indicators of our three-year Medium-Term Management Plan (2022-2024).
As we up the pace and tackle transformational challenges toward realizing our Long-Term Vision of 'ART for Human Possibilities: Let's strive for greater happiness,' we will endeavor to deliver Kando* to and answer the expectations of all our stakeholders.
*Kando is a Japanese word for the simultaneous feelings of deep satisfaction and intense excitement that we experience when we encounter something of exceptional value.
Consolidated Business Results
Net sales were 2,414.8 billion yen (an increase of 166.3 billion yen or 7.4% compared with the previous fiscal year) and operating income was 250.7 billion yen (an increase of 25.8 billion yen or 11.5%). Ordinary income was 242.0 billion yen (an increase of 2.7 billion yen or 1.1%) and net income attributable to owners of parent was 164.1 billion yen (a decrease of 10.3 billion yen or 5.9%). These figures once again reset the Company's record for net sales and operating income. For the full consolidated fiscal year, the U.S. dollar traded at 141 yen (a depreciation of 9 yen from the previous fiscal year) and the euro at 152 yen (a depreciation of 14 yen).
Net sales rose thanks not only to healthy demand for motorcycles and large outboard motors but also increased supply volumes resulting from supply chain operations returning to normal and improvements with logistics, production issues, and other areas. Operating income increased due in part to higher unit sales, but also from the greater effects of passing on prices to offset the soaring costs of raw materials and more, and the benefits of a depreciated yen. Net income fell due to the effects of appraised losses derived from interest rate swaps, foreign exchange gains and losses, appraised losses on investment securities, gains from investment securities sales conducted last year, and other factors.
Results by Business Segment
Land Mobility Business
Net sales were 1,581.8 billion yen (an increase of 113.6 billion yen or 7.7% compared with the previous fiscal year) and operating income was 124.3 billion yen (an increase of 36.9 billion yen or 42.3%).
For the motorcycle business, demand in Europe and North America was robust and also grew in many emerging markets primarily in Asia, with the exception of Vietnam and China, which are suffering from prolonged sluggish economies. Higher unit sales in Europe, North America, and in emerging markets-namely Indonesia, India, and Brazil-resulted in higher net sales for the business. For operating income, the Company brought in higher profits mostly thanks to these higher unit sales, but the benefits of passing on costs and a weaker yen also contributed.
With recreational vehicles (all-terrain vehicles, ROVs, and snowmobiles), the boom in outdoor recreation has passed and as demand has slowed, so have unit shipments. On the other hand, the Company's U.S. factory was also facing issues last year, but production efficiency improvements, together with the added gains from a weaker yen, gave the business higher sales and profits.
For the Smart Power Vehicles business, i.e., electric wheelchairs, electrically power-assisted bicycles (eBikes) and their drive units (e-Kits), market inventory adjustments have remained ongoing in the industry's main market of Europe. The Company also carried on with production adjustments, but market inventories continue to remain at a high level and it will likely be some time until this matter is resolved. In terms of net sales and operating income, eBike and e-Kit unit sales fell and the business recorded lower sales and profits overall.
Marine Products Business
Net sales were 547.5 billion yen (an increase of 30.5 billion yen or 5.9% compared with the previous fiscal year) and operating income was 113.7 billion yen (an increase of 4.5 billion yen or 4.1%).
Demand for large horsepower outboard motors in the U.S. was strong, but small and midrange outboard motor demand declined. Over in Europe, concerns of an economic recession led outboard motor demand to decrease overall. In China and Southeast Asia, demand was higher in the commercial fishing and tourism markets, while commercial fishing demand remained steady in Central and South America. While unit sales were higher in emerging markets, they fell in developed markets and this resulted in lower outboard unit sales overall. For personal watercraft, favorable demand continued and the Company recorded higher unit sales. The positive effect of the yen's depreciation also contributed to the overall increase in sales and profits for the business.
Robotics Business
Net sales were 101.4 billion yen (a decrease of 14.5 billion yen or 12.5% compared with the previous fiscal year) and operating income was 0.9 billion yen (a decrease of 11.0 billion yen or 92.7%).
In the surface mounter market, automotive segment and industrial equipment demand was strong, but China's economy remains sluggish and demand for smartphones, PCs, and other consumer electronics and appliances has fallen, leading to markedly lower sales in China and Taiwan, among other markets. With industrial robots, demand for investment in batteries for EVs had risen in Japan and South Korea, but the decline in sales in China heavily affected this part of the business as well. On the other hand, higher demand for generative AI applications brought in higher orders for the Company's semiconductor manufacturing equipment. As a result, the Robotics business as a whole posted lower sales and profits.
Financial Services Business
Net sales were 86.5 billion yen (an increase of 24.3 billion yen or 39.1%) compared with the previous fiscal year) and operating income was 15.3 billion yen (a decrease of 2.2 billion yen or 12.6%).
From the rise in unit sales, financial receivables increased in turn and by passing procurement interest rates on to customers, net sales were higher. However, higher fundraising costs, a higher allowance for doubtful accounts accompanying the increase in receivables, and appraised losses derived from interest rate swaps in Brazil and other developments drove down the business' profits overall.
Other Products
Net sales were 97.6 billion yen (an increase of 12.4 billion yen or 14.6% compared with the previous fiscal year) with an operating loss of 3.6 billion yen (compared to an operating loss of 1.2 billion yen).
Improving production efficiency at the U.S. factory raised golf car unit sales and the business took in higher sales, but higher fixed costs and other expenses incurred by other segments of the business overall resulted in lower profits.
Forecast of Consolidated Business Results for the Fiscal Year Ending December 31, 2024
In 2024, we expect to achieve all of the various indicators of the current Medium-Term Management Plan. We anticipate emerging market demand to be spearheaded by Indonesia, India, and Brazil, while in developed markets, we believe spending by high-income consumers in the U.S. will be robust. We are also expecting to see ocean freight rates come down.
However, possible risks include rising costs for personnel, parts, and more; disruptions to logistics in the Red Sea; and exchange rate fluctuations. We will also counter the impacts the Noto Peninsula earthquake had on our supply chain by procuring alternative parts and other means.
The forecast consolidated business results for FY2024 are as follows. Yamaha Motor has chosen to adopt International Financial Reporting Standards (IFRS) from fiscal 2024 onward, thus the consolidated business results forecast for fiscal 2024 have been prepared according to said standards. The reference to fiscal 2023's figures, which are based on Japanese generally accepted accounting principles (GAAP), are to provide a simple comparison.
Basic Policy Concerning Profit Distribution and Dividends for the Current and Subsequent Fiscal Years
Recognizing that improvement of shareholder benefits represents one of the Company's highest management priorities, the Company has been striving to meet shareholder expectations by working to maximize its corporate value.
The Company works on the principle of paying an interim dividend and a final dividend. Decisions with regard to the dividends are made by the Board of Directors for the interim dividend, and the Ordinary General Meeting of Shareholders for the final dividend. The dividend record dates are stated in the Articles of Incorporation as June 30 for the interim dividend and December 31 for the final dividend.
Regarding the final dividend for the current fiscal year, a dividend of 72.5 yen per share is planned to be placed on the agenda of the 89th Ordinary General Meeting of Shareholders, scheduled for March 21, 2024. With the interim dividend of 72.5 yen per share, this gives a total dividend for the year of 145 yen per share.
In addition, as specified in the Medium-Term Management Plan announced in 2022, per our new shareholder returns policy, we will emphasize making consistent and ongoing dividend payments while taking into consideration the outlook for business performance and investments for future growth, and continue distributing returns to shareholders in a flexible way based on the scale of our cash flows with the total payout ratio set at the 40% range for the cumulative total of the plan's period.
The Company conducted a 3-for-1 stock split of common stock with an effective date of January 1, 2024. From this, for the next fiscal year, a total of 50 yen (interim dividend of 25 yen and final dividend of 25 yen) is planned, as well as a 20.0 billion yen acquisition of treasury stock.
Contact:
Tel: +81-538-32-1145
YAMAHA MOTOR CO., LTD. 
