Mazda 2012 Annual Report Download - page 12

CFO Interview
Kiyoshi Ozaki
Representative Director, Executive Vice President and CFO
Q What were the main factors behind the changes in
Mazda’s earnings for the fiscal year March 2012
compared with the previous year, and what are
your forecasts for the fiscal year March 2013?
A This was a very difficult year, and we recorded an operating
loss of ¥38.7 billion and a net loss of ¥107.7 billion. Despite
some offset from comprehensive efforts in conjuc tion with
suppliers to reduce costs, a ¥36.3 billion negative impact from
changes in the mix of models sold and a ¥37.6 billion deterio-
ration from foreign exchange factors led to a ¥62.6 billion
decline in operating income.
Although the impact from the yen’s appreciation was
unavoidable, the weakening in the product mix is a problem.
The main reasons for this reduction in earnings, in addition to
the damage from the Great East Japan Earthquake and
flooding in Thailand, were the recession in Europe, triggered by
the sovereign debt crisis, and a delayed response to intensified
competition for sales in China. With regard to China, I believe
this delayed response is a reflection of Mazda’s distinctive
strategy of maintaining the brand by not getting caught up in
competition through offering incentives. Nevertheless, we
were able to maintain profitability at all levels in the fourth
quarter, and earnings are showing a rapid improvement. In
terms of net income, however, it is important to note that we
recorded a write-off of deferred tax assets and brought forward
expenses related to structual reform for the future.
We will achieve sales growth in all major markets in the fiscal
year March 2013, on a full-year contribution from the new
Mazda CX-5 crossover SUV, fully equipped with SKYACTIV tech-
nology, and the launch of the new Mazda6 (Japanese name:
Mazda Atenza). In addition, we will continue to work with
suppliers to reduce costs, and I am confident that we will achieve
profitability at all levels.
Q You said that signs of improvement were seen at
all profit levels in the fourth quarter. What were
the factors behind this?
A This was because of a large increase from the third quarter
in wholesales. Compared with the third quarter, fourth-quarter
wholesales rose roughly 84,000 units. Of this, the new CX-5
made a large contribution, with a net increase of approximately
30,000 units. The new CX-5 is receiving high praise on a global
level, and we see this superior brand strength leading to
increased sales going forward. In addition, we were able to
realize the benefits of cost improvements made through joint
efforts with suppliers. As a result, although we recorded an
operating loss of more than ¥30 billion in the third quarter, the
fourth quarter showed a roughly ¥48 billion improvement, to a
¥15.6 billion profit.
Consolidated Wholesales
Year ended
March 31, 2011 Year ended March 31, 2012
Full-year 1Q 2Q 3Q 4Q Full-year
Japan 206 43 66 46 71 226
North
America 367 59 93 92 118 362
Europe 208 27 47 37 60 171
China 20 3 5 1 1 10
Others 299* 54 73 55 65 247
Tot al 1,100 186 284 231 315 1,016
Mazda is using product strength that is second
to none, excellent design, and unmatched driving
performance and fuel economy to build a global
earnings base.
* Includes 16,000 units resulting from the effect of a 15-month fiscal period stemming
from a change in the fiscal year-end of an overseas subsidiary.
Mazda Annual Report 2012
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