GM affiliates on profit seesaw: Suzuki makes money; Isuzu loses.

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Author: Yamaguchi, Yuzo

Dateline: TOKYO â€"

Two of General Motors' Japanese affiliates, Suzuki Motor Corp. and Isuzu Motors Ltd., reported opposite financial results last week for the fiscal year ended March 31.

Suzuki boosted its operating profit and revenue to record highs, while Isuzu posted record losses and record low revenue. GM owns 20 percent of Suzuki and 12 percent of Isuzu.

Buoyed by strong demand for small cars and minivehicles from Asia and Japan, Suzuki's consolidated, or worldwide, operating profit for the year jumped 26.9 percent to ¥74.2 billion, or $617.3 million at current exchange rates.

The rise came on a 20.8 percent gain in revenue, to $16.8 billion. Net income surged 38.5 percent to $258.1 million.

In Japan, Suzuki cashed in on 660cc minivehicles, including some it builds for other automakers such as Nissan Motor Co. Ltd. Full consolidation of results from Maruti Udyog Ltd., India's biggest automaker, also was a big contributor to profits.

Suzuki raised its stake in Maruti from 50 percent to 54.2 percent last fiscal year. Cost cutting added $391 million to the operating profit.

Meanwhile, Isuzu's net loss widened to $1.2 billion from $357.7 million a year earlier as the struggling truckmaker took a one-time charge of $1.1 billion to reflect the cost of restructuring its North American operations. Reflecting its slowing business there, Isuzu's revenue slid 15.5 percent to $11.2 billion.

Operating profit rose 2.2 percent to $128.6 million, boosted by cost reductions.

Isuzu says it expects to post $291.2 million in net income for the current fiscal year and a $416 million operating profit as cost cutting takes root.

But it says it expects revenue to drop 7.4 percent, to $10.4 billion, reflecting the sale of its diesel units in the United States and Poland.

It sold majority stakes in those operations to GM in December.

Suzuki says it expects to report record profits and revenue again this year, partly by hacking costs further.

It predicts net will rise 12.8 percent to $291.2 million; operating profit by 14.5 percent to $707.2 million; and revenue, 5.2 percent to $17.6 billion.

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By Yuzo Yamaguchi, STAFF REPORTER

                          2003               % CHANGE
SUZUKI
Revenue                $16,766.3               +20.8
Operating profit           617.3               +26.9
Net income                 258.1               +38.5
Unit sales         1.745 million               +8.7
ISUZU
Revenue                $11,226.7               -15.5
Operating profit          $128.6                +2.2
Net loss              ($1,200.5)                 n/a
Unit sales               278,000                -9.7
Notes' Results are consolidated, meaning they include most major
subsidiaries Yen amounts converted at $1=Â¥120.20, the rate
on March 31, 2003
Source: Companies