Profits double at Toyota on higher luxury car sales

Toyota Motor Corp's first-quarter group profit more than doubled as the world's third-largest automaker gained from a pension change and sold more of its luxury vehicles in the US and other overseas markets.

Net for the maker of Lexus cars in the three months to June 30 rose to ?352.3 billion (US$2.9 billion), or ?100.8 a share, from ?162.3 billion, or ?44.64 a share, in the year- earlier period, the company said.

"Fundamentally, it's a very strong operating result and that is well ahead of market expectation," said Marc Desmidt, who helps manage ?1 trillion at Merrill Lynch Investment Managers Co, including Toyota shares.

Toyota a special gain of ?163.7 billion after the automaker transferred part of its pension obligations to the government following a change in state policy. Without this gain, the profit increase would have been 16 percent to ?188 billion.

Japan's automaker and rivals Honda Motor Co and Nissan Motor Co have said they will break profit records this year as new model releases woo buyers abroad.

"By staying focused on the needs of our customers around the world we hope to surpass last year's operating result," said executive vice president Ryuji Araki.

The automaker's sales in the first quarter rose 20 percent to ?4.02 trillion from ?3.35 trillion a year earlier, the company said. Operating profit in the period rose 35 percent to ?394.5 billion, while current profit, or pretax profit from operations, rose 51 percent to ?449.9 billion.

Toyota's unit sales in the period increased 13 percent to 1.5 million vehicles. The company increased its forecast for unit sales in the year to March 31, 2003 by 2 percent to 6.11 million vehicles.

The automaker also gained ?70 billion from cost cuts and an equal amount from favorable currency exchange rates in the quarter. The results were based on average yen exchange rates of ?127 to the dollar and ?117 to the euro, the company said.