Suzuki 2006 Annual Report Download - page 24

SUZUKI MOTOR CORPORATION
1. Operating results
Consolidated net sales for the Suzuki Group during the current fiscal year amounted to 2,746,453 million yen (116.1%
as against PFY). Operating income amounted to 113,865 million yen (105.9% as against PFY). Net income amounted to
65,945 million yen (109.0% as against PFY). These results were due to increases in R&D expenses and depreciations
being absorbed by cost reduction, sales increase and exchange gain.
Factors which significantly influenced the consolidated statement of income are described as follows:
Note: PFY=Previous fiscal year
(1) The operating results by business segmentation
(a) Motorcycle operations
The net sales in domestic market increased over the previous fiscal year with the total domestic demand being
slightly increased, thanks to good selling of scooter model “Let’s 4” and “Address V125”, etc.
In overseas market, sales increased greatly over the previous fiscal year with good sales of large size model
“GSX-R1000” and “Boulevard”, etc., introduction of new sports ATV “LT-R 450”, increase of local product in Asian
region and so on.
As a result, the net sales of motorcycle operation reached 561,306 million yen (121.9% as against PFY) and
operating income increased to 45,931 million yen (120.4% as against PFY) through the absorption of increased
R&D expenses and other expenses, etc. by cost reduction and sales increase.
(b) Automobile operations
In the domestic market, in addition to good sales of the subcompact passenger vehicle “Swift” and the mini
vehicle “Wagon R”, the Company introduced a new SUV “Escudo” and also “Every” and “MR Wagon” in mini
section. As a result, the domestic net sales increased over the previous fiscal year.
Overseas sales increased over the previous fiscal year as well by good selling of “Swift” whose production and
sales as world strategic vehicle started in Hungary, India and China and “Grand Vitara” (export model of “Escudo”)
whose export started from Japan. As a result, net sales of automobile operations amounted to 2,119,940 million yen
(114.9% as against PFY). Operating income decreased to 57,928 million yen (96.3% as against PFY) by increased
depreciation, R&D expenses and other expenses, etc. inspite of cost reduction and sales increase.
(c) Other businesses
The net sales of other businesses amounted to 65,206 million yen (110.1% as against PFY) and operating
income increased to 10,005 million yen (108.2% as against PFY) due to sales increase etc.
(2) The operating results of geographical segmentation
(a) Japan
Net sales amounted to 1,818,378 million yen (112.3% as against PFY) and operating income decreased to
60,776 million yen (92.6% as against PFY) as the increase of depreciation, R&D expenses and other expenses,
etc. could not be absorbed by cost reduction and sales increase.
(b) Europe
Net sales amounted to 492,049 million yen (118.8% as against PFY) by introduction of new subcompact
passenger vehicle “Swift”, etc. and operating income increased to 7,768 million yen (116.1% as against PFY)
through absorption of increase of depreciation with increase of production of “Swift” at “Magyar Suzuki Ltd.”, and
start of production of new sports crossover vehicle “SX 4”, and other expenses.
(c) North America
Net sales amounted to 392,885 million yen (129.4% as against PFY) by introduction of new SUV “Grand
Vitara”and good selling of large size motorcycle model. Also operating income increased to 7,222 million yen
(155.7% as against PFY) by increase of sales.
(d) Asia
Net sales amounted to 606,735 million yen (121.3% as against PFY) by sales start of new subcompact
passenger vehicle “Swift” at “Maruti Uddyog Limited” in India and sales increase at “PT Indomobile Suzuki
International” in Indonesia and operating income increased to 45,386 million yen (121.7% as against PFY) by
sales increase and cost reduction, etc.
FINANCIAL REVIEW
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