Summary of Consolidated Business Results for Fiscal Year Ended December 31, 2012

February 14, 2013

Consolidated business results

Net sales for this fiscal year were 1,207.7 billion yen, 5.4% less than the previous year. Sales of marine products, power products, and automotive engines increased over the previous year. Conversely motorcycle sales decreased against the previous year due to reduced demand in Europe and stock adjustments and reduced demand in Indonesia and Brazil. Furthermore, appreciation of the yen resulted in a negative effect in foreign exchange conversion of 45 billion yen. Operating income was 18.6 billion yen (a decrease of 65.2% compared to the previous fiscal year), ordinary income was 27.3 billion yen (a decrease of 57.1%), and net income for the fiscal year was 7.5 billion yen (a decrease of 72.2%). While positive factors such as cost reductions, decreased raw material costs, and expense reductions were in evidence, a decrease in sales of motorcycles in Europe and in emerging nations, the appreciating yen, the reversal of accrual for product liability (13.4 billion yen in the previous fiscal year and 2.4 billion yen this fiscal year), and increased development expenses aimed at future growth, all contributed to a decrease in income.
For the year, the U.S. dollar traded at 80 yen (the same as the previous fiscal year), and the euro at 103 yen (an appreciation of 8 yen from the previous fiscal year).

Results by business segment

Motorcycle Business

Global net sales for the motorcycle business were 798.7 billion yen (a decrease of 10.0%), with an operating loss of 200 million yen (the previous fiscal year showed an operating income of 27.6 billion yen). Sales in developed countries decreased overall, with increases in the United States outweighed by decreases in Europe. Amongst the emerging nations, Thailand (subject to flooding in the previous year) and India showed increases, and Indonesia, Vietnam and Brazil, showed decreases as a result of reduced demand and stock adjustments leading to a decrease overall. Global motorcycle sales were 6.09 million units (a decrease of 698,000 units or 12.8% compared to the previous fiscal year).

Marine Business

Global net sales of marine products were 196.3 billion yen (an increase of 9.7% compared to the previous fiscal year), and operating income was 10.8 billion yen (an increase of 53.0%). Due to a recovery in demand in the United States, outboard motors, water vehicles, and sports boat sales have moved in a positive direction. Outboard motor sales in emerging nations such as Russia also increased. In Japan recovery-induced demand has contributed to increases in sales of fishing boats, Japanese-style boats, and outboard motors.

Power Products Business

Net sales of power products overall were 103.6 billion yen (an increase of 3.3% compared to the previous fiscal year). The reversal of accrual for product liability (13.4 billion yen in the previous fiscal year and 2.4 billion yen this fiscal year) contributed to operating income of 500 million yen (a decrease of 92.9% compared to the previous fiscal year). Sales of golf cars increased, but all-terrain vehicles (ATVs) fell. Furthermore, sales of generators increased in Japan and the United States due to increased demand and new customer acquisition.

Industrial Machinery & Robots Business

Net sales of industrial machinery & robot products overall were 30.8 billion yen (a decrease of 10.2% compared to the previous fiscal year), and operating income was 3.8 billion yen (a decrease of 38.9%). Smartphone and tablet-related demand has moved in a positive direction, but as global facilities investment is currently sluggish, sales of surface mounters have decreased overall.

Other products

Overall net sales of other products were 78.3 billion yen (an increase of 4.2% compared to the previous fiscal year), and operating income was 3.6 billion yen (a decrease of 28.2%). Sales of automotive engines increased against the previous fiscal year. Sales of electrically power assisted bicycles decreased against the earthquake-fuelled demand of the previous year. However, general demand is on the increase.

Forecast of consolidated business results for fiscal year ending December 31, 2013

A gradual recovery of demand in the United States for motorcycles and outboard motors etc. is anticipated. Demand for motorcycles in emerging nations such as in Asia and Central and South America is forecast to begin recovery. In response to the conditions of the extremely high yen experienced in the current fiscal year, the Yamaha Group has been taking initiatives to expand the Group's scale of operations and increase profitability by improving overall business competitiveness. Based on the above, in the next fiscal year (year ending December 31, 2013) the Group will aggressively roll out new models and strengthen cost reduction initiatives such as platform strategies, aiming for business recovery in developed countries, a return to profitability, and the recovery of scale and profitability in emerging nation businesses.

With regard to consolidated business results for fiscal year ending December 31, 2013, increased revenue is anticipated through higher emerging nation motorcycle sales, and United States outboard motor sales. In terms of profitability, increased profitability through increased revenue and further cost reductions, as well as the depreciating yen, should overcome increases in promotional costs and research and development expenses aimed at future growth, leading to a forecast overall increase in profitability.

These forecast figures are based on the U.S. dollar trading at 87 yen during the fiscal year (a depreciation of 7 yen from fiscal 2012), and the euro at 115 yen (a depreciation of 12 yen from fiscal 2012).