Toyota Motor Corp.’s profit grew significantly in the first quarter. This prompted Toyota to raise its sales forecast on the demand for cars offered in North America and Japan. In the three months ended June 30, Toyota reported an increase in its net income to 290.3 billion yen ($3.7 billion). During the same period a year ago, the company reported a net income of 1.16 billion yen.
Profit is now at its highest level within four years. From January to December, Toyota said that auto sales for its Toyota, Daihatsu and Hino brands would increase to 9.76 million, improving on a previous target of 9.58 million.
Toyota, which has been hampered by the impact of the natural calamities in 2011, has sold more vehicles than General Motors Co. and Volkswagen AG to be at the top of the industry for two consecutive quarters.
Furthermore, Toyota predicted that the output for the period will be at 10.05 million units. Meanwhile, it reported 117.6 billion yen in operating profit from North America, a huge jump from 28.9 billion yen the previous year. President Akio Toyoda and Toyota are relying on the Prius and Camry to maintain the earnings growth in the U.S. as analysts expect the demand in Japan to slow down.
Koichi Sugimoto, a Tokyo-based auto analyst at BNP Paribas SA, said that in the first quarter, Toyota's business results were strong but it should be noted that the surge in sales had been driven by the domestic subsidies and new cars such as the Camry in the U.S.
He explained further that the currency rate should be what Toyota has to focus on for remaining periods left in the fiscal year. In 2012, Toyota reported a 19% gain in Tokyo trading.
It had closed at 3,065 yen before the company divulged its latest earnings result. Nevertheless, the stock has given up around half of its gains since the end of March after the yen turned into the best-performing major currency from being the worst performer after just a quarter.