INSTANT VIEW: Toyota Motor slashes 2008/09 forecasts
TOKYO (Reuters) - Toyota Motor Corp, the world's biggest carmaker, reported a 72 percent drop in quarterly operating profit hit by a stronger yen, weak sales and expensive raw materials, and lowered its full-year forecasts.
Following are initial reactions of analysts and investors:
YASUAKI IWAMOTO, ANALYST AT OKASAN SECURITIES
"I had never imagined such a big downward revision on its earnings outlook and a sharp fall in its interim result. It was a negative surprise and a large impact on its stock price tomorrow would be inevitable.
"What surprised me was a big cut in operating profit forecast despite a relatively small adjustment in sales forecast."
KOJI ENDO, AUTO ANALYST, CREDIT SUISSE
"I was very much stunned. The market consensus was around 1 trillion yen to 1.2 trillion yen, but the company came with 600 billion yen. First-half profit was already more than 580 billion yen, so that means the company is looking at little profit in the second half. "This forecast is so low that it makes one fear 'is it really that bad?' It gives me really bad impression.
"Of course the exchange rate is one reason, but the biggest factor is probably a cut in sales forecast. Also, I don't know the details but output reduction and an increase of loan-loss reserves are likely behind that. Not just slower sales, but sales mix should have deteriorated too.
"The shares should go limit low tomorrow. Maybe they will end untraded."
TAKESHI OSAWA, SENIOR FUND MANAGER, NORINCHUKIN ZENKYOREN ASSET MANAGEMENT
"(The size of the outlook cut) was a surprise. I first mistook its revised full-year operating profit forecast as its first-half results."
"I had expected somewhere like 800 billion yen for the revised full-year operating profit, but did not expect to see 600 billion yen. I hope the firm has made very conservative forecasts so that it won't have to cut them again.
I think Toyota's outlook cut will have a negative impact on the Japanese stock market as the feeling of hitting the bottom may peeled off."
MARKET ACTION:
Toyota shares closed down 10.4 percent at 3,810 yen ahead of the results announcement.
(Reporting by Tokyo Newsroom)
