TOKYO (AFP) - Scandal-hit Japanese automaker Mitsubishi Motors said its interim net loss nearly doubled to a record 146.16 billion yen (1.38 billion dollars), downgrading its full-year earnings forecast.
The company, hit by a series of defect cover-ups which have forced massive vehicle recalls, reported a net loss of 80.22 billion yen a year earlier.
Japan's fourth-largest carmaker said its recurring loss also widened to a record 97.69 billion yen in the six months to September from 85.79 billion yen, while revenue slumped 11.3 percent to 1.07 trillion yen.
For the year to March 2005, Mitsubishi forecast a net loss of 240 billion yen and a recurring loss of 180 billion yen on sales of 2.1 trillion yen, all revised down from its earlier projection of 230 billion yen, 150 billion yen and 2.25 trillion yen, respectively.
Chief financial officer Hiizu Ichikawa said Mitsubishi Motors was "very sorry for the companies who have assisted us" as its share price has plunged this year.
"The only thing we can do now is to carry out our revival plan and raise the stock price over the medium- to long-term," he said, announcing the worst first-half results in the company's 34-year history.
On Monday, Mitsubishi Motors shares lost three yen or 2.60 percent at 112 yen. It hit a high for the year of 350 yen on April 13 and has since fallen steadily as the company struggles with the fallout from the defect cover-up scandals and vehicle recalls.
US-German auto giant DaimlerChrysler's decision in April against injecting any fresh capital into the company forced it to seek urgent help elsewhere.
Mitsubishi Motors subsequently secured rescue financing of 496 billion yen from fellow group firms and other investors in return for pledges to cut costs through trimming its workforce and closing factories in Japan and Australia.
Hideyasu Tagaya, Mitsubishi president and chief operating officer, repeated that the company was pursuing tie-ups with other carmakers to keep its factories running but that it has yet to reach any agreement.
Extraordinary losses totaled 45.2 billion yen for the six months period, the company said, citing losses of 19.9 billion yen on free vehicle inspections, 6.1 billion yen on restructuring in Australia, 6.3 billion yen on restructuring its domestic facilities and 7.9 billion on the cancellation of a new model.
The operating loss narrowed to 63.46 billion yen from 76.35 billion yen due to lower sales incentives in North America, decreased advertisement in Japan and the absence of US credit losses incurred last year, Ichikawa said.
Mitsubishi said vehicle revenues in Japan in the six months dropped 37.5 percent to 182.8 billion yen while the key US market fell 15.6 percent to 237.3 billion yen.
In contrast, revenue in Europe rose 9.2 percent to 348 billion yen, thanks to a new Colt model and brisk sales in Britain, Russia and Ukraine, the company said.
Sales in Japan have been particularly depressed since the company admitted to covering up a series of defects, some of which proved fatal. Mitsubishi Motors and its former truck-making unit, now a subsidiary of DaimlerChrysler, were forced to recall hundreds of thousands of vehicles globally as a result.
Global sales fell 16 percent to 646,000 units for the first half and the company forecast full-year sales at 1.40 million, down from the 1.45 million projected in May and 1.53 million in the previous year.
"Sales in China are slowing more rapidly than we expected but Indonesia is relatively faring well," Ichikawa said, adding sales in Brazil and other Latin American nations were strong.
11/09/2004 - 05:34 GMT - AFP