Suzuki 2005 Annual Report Download - page 2

SUZUKI MOTOR CORPORATION
In delivering our Annual Report 2005, we wish to
extend our greetings to you.
In terms of the business environment in which our
group was involved, domestically there was a modest
but fundamental note of economic recovery, spurred
by increases in capital investments and improvements
in business earnings. Overseas, there was a steady
recovery of economic conditions globally, against a
background of firm growth of the American economy,
and high growth of the Chinese economy. However,
export and production growth remained soft, due to
high crude oil prices, increases in the cost of raw
materials, and currency exchange fluctuations, and the
outlook for the market remains uncertain.
In this situation, efforts were made to strengthen
research and development, production and our sales
structure, in order to strengthen our product
competitiveness and to expand sales. As a result,
consolidated net sales for the term were ￥2,365,571
million (107.6% as against previous fiscal year (PFY)).
In terms of consolidated income, increases in
exchange losses, research and development
expenses and depreciation expenses were absorbed
by reductions in price cost and increases in sales.
Operating income was ￥107,542 million (113% PFY),
and ordinary income(＊)was ￥109,532 million (115.0%
PFY). Both operating income and ordinary income
showed a profit in excess of ￥100,000 million for the
first time in our history. Also, net earnings for the term
were ￥60,506 million (138.0% PFY).
Non-consolidated net sales were ￥1,481,632 million
(106.4% PFY). In terms of non-consolidated income,
the current net income were ￥35,747 million (139.4%
PFY), because of decrease of extraordinary losses,
etc. However, due to increases in research and
development expenses, etc., operating income were
￥52,835 million (95.9% PFY), and ordinary income
was ￥52,936 million (95.7% PFY).
Dividends at the end of the current fiscal year were a
4 yen ordinary dividends plus the special dividends of
2 yen, for a total of 6 yen per share for the year (10 yen
including interim dividends).
As for the business environment around our group,
currency exchange fluctuations and other factors
remain extremely uncertain, and competition between
rival companies has increased even further, leading to
an extremely severe situation.
In order to deal with this type of severe environment,
our group will implement revision in all fields, and make
efforts to strengthen management culture, under our
basic corporate policy for the fiscal year 2005,
summed up by the slogan: "In order to survive, let us
stop acting in a self-styled manner and get back to
basics."
In terms of motorcycles, in Japan, efforts will
continue in order to expand sales of small motor
vehicles and larger motorcycles. In Asia, expansion of
sales of smaller motorcycles will be promoted, and
expanded sales of larger motorcycles will be promoted
in the North American market, in order to construct a
highly-profitable motorcycle operation.
In terms of automobiles, in Japan, efforts are
underway to strengthen and develop the existing sales
network, to strengthen market information gathering,
and to improve the level of customer satisfaction.
Efforts will also be made to strengthen the sales force
of "Suzuki Arena", our sales channel for small and
subcompact vehicles, which is tied to increased sales
of small- and standard-sized vehicles. Overseas,
product development and business activities closely
tied to the market will be pursued. At the same time, at
overseas production plants, automation, onsite
procurement of components, and cost reductions will
be pursued in order to further heighten quality and
productivity, aiming to even further strength our
overseas bases. In addition, we will endeavor to
maximally utilize the synergy resulting from a strategic
tie-up with General Motors Corporation and various
companies in the GM group, aiming to strengthen our
business base.
Furthermore, efforts will be taken to develop, in an
effective and efficient manner, products that closely
suit each of the four central markets in the world, and
to introduce them in a timely fashion. And for the
protection of the global environment, we will promote
development of products designed for low
environmental impact by reducing gas exhaust
emissions, improving fuel efficiency, reducing the
amount of natural resources required for their
production and facilitating recycling. We will also
develop next-generation vehicles such as vehicles
powered by fuel-cell systems.
Under the motto "Small Cars, - for a Big Future,"
Suzuki has set out our determination to continue active
efforts to develop small cars that our customers
demand and to make efforts to ensure our products
have a minimal impact on the global environment. At
the same time, we will keep on working toward
maintaining a highly efficient and healthy business
operation.
In terms of our directors and employees, all statutes,
social norms and in-house bylaws will be strictly
observed, and we will act frankly and with sincerity.
We look forward to the continued support and
encouragement of all of our stockholders.
September, 2005
(＊)obtained by deducting non-operating income and expenses (interest and
dividend income, interest expense, etc.) other than special items from
operating income
−1−
A MESSAGE FROM THE MANAGEMENT