Isuzu 2003 Annual Report Download - page 5

ISUZU MOTORS LIMITED ANNUAL REPORT 2003
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THE FISCAL YEAR IN REVIEW During fiscal 2003, ended
March 31, 2003, despite higher unit truck sales in Japan, total
worldwide vehicle unit sales declined 9.9% year on year,
partly due to structural reform initiatives. In addition, sales
of automotive components for overseas production fell 4.0%.
Meanwhile, engine and component sales climbed ¥24.7 billion,
or 11.0%, to ¥250.3 billion, buoyed by healthy demand in the
ASEAN region. Nevertheless, consolidated net sales decreased
15.5% to ¥1,349.4 billion. Operating income rose 2.2% to ¥15.4
billion as the benefits of cost-cutting measures, the result
of initiatives to trim payroll expenses, more than offset
restructuring-related charges in North America. Isuzu, how-
ever, posted a net loss of ¥144.3 billion for a number of reasons.
One was a ¥76.7 billion loss on investment for affiliated com-
pany restructuring in North America. Isuzu also booked a
charge of ¥24.8 billion for a severance benefit related to an
early retirement plan; a loss on business model reform of
¥12.2 billion relating to the downsizing of the SUV business;
and a loss of ¥9.5 billion on the revaluation of investments.
These charges outweighed items such as a ¥9.9 billion gain
on sales of investments and a ¥13.4 billion gain on the return
of the substituted portion of the employee pension fund to
the Japanese government.
OUTLOOK FOR THE FISCAL YEAR ENDING MARCH 31,
2004 Japan is expected to see replacement demand pick
up with the upcoming application of stricter emissions stan-
dards, while overseas, Isuzu forecasts higher sales in key
markets such as Asia. However, business conditions will remain
challenging, due to growing uncertainty about the global
economy, in light of intensifying competition both at home
and abroad, the cost of reconstruction in Iraq, prospects for
the U.S. economy and other factors.
Consequently, Isuzu is projecting consolidated net sales of
¥1,250.0 billion, income before special items of ¥40.0 billion
and net income of ¥35.0 billion.
The Isuzu Group’s highest priority is to improve its earn-
ings base by accomplishing the goals of the New Three-Year
Business Plan. We will address environmental issues by making
the most of our competitive advantages in front-running
exhaust emission and environmental technologies. At the
same time, we will make Isuzu even more competitive world-
wide on both cost and quality fronts.
As always, we will be guided by our commitment to con-
tributing to society by developing products and services that
satisfy customers worldwide while evolving as an organiza-
tion with an exemplary character. Underpinned by this
corporate philosophy and determined to take on challenges,
innovate and create, while giving the highest priority to qual-
ity in everything we do, our long-term vision is to become a
front-running logistics systems engineering company.
I ask for your continued understanding and support as
we work to achieve our goals.
June 2003
Yoshinori Ida
President & Representative Director