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Summary of Business Results for the First Quarter of the Fiscal Year Ending December 31, 2008

April 25, 2008

Consolidated business results

Yamaha Motor Co., Ltd. (the "Company") announced its consolidated business results for the first quarter (January 1 through March 31, 2008) of the fiscal year ending December 31, 2008. Net sales decreased 9.0 percent from the previous first quarter, to 412.9 billion yen. Operating income, ordinary income and net income also dropped -- by 16.4 percent, to 31.1 billion yen, by 12.8 percent, to 34.2 billion yen, and by 11.6 percent, to 22.2 billion yen, respectively.

On the foreign exchange front, the average purchasing value of the yen against the U.S. dollar during the period under review appreciated by six yen from the previous first quarter, to 110 yen, and dropped by eleven yen against the euro, to 161 yen.

Broken down by business segment, motorcycle sales fell 6.4 percent from the previous first quarter, to 266.3 billion yen. This was mainly attributable to decreased demand in North America, coupled with the impact of the higher yen against the U.S. dollar, although sales in Indonesia, Thailand and Brazil expanded. Marine product sales dropped 12.8 percent, to 63.6 billion yen. Although sales were brisk in Russia, overall performance in the segment declined due mainly to decreased sales of outboard motors and delayed shipments of new personal watercraft models in North America, coupled with the impact of the higher yen against the U.S. dollar. Power product sales declined 14.1 percent, to 49.7 billion yen, primarily reflecting slow demand for all-terrain vehicles amid the economic slowdown in North America, coupled with the impact of the higher yen against the U.S. dollar. Sales in the "other products" segment decreased 13.8 percent, to 33.3 billion yen, due mainly to reduced surface mounter sales.

Meanwhile, operating income from the motorcycle segment increased 1.3 percent, to 19.6 billion yen. Operating income from the marine product segment, power product segment and the "other products" segment declined -- by 27.2 percent, to 5.9 billion yen, by 41.7 percent, to 2.3 billion yen, and by 43.2 percent, to 3.3 billion yen, respectively.

Positive factors affecting operating income include a drop in selling, general and administrative expenses totaling 6.5 billion yen from the previous first quarter, and cost reductions in procurement operation totaling 1.9 billion yen. However, these positive factors were more than offset by such negative factors as a decline in gross profit due to decreased net sales totaling 5.2 billion yen; the negative impact of exchange translation totaling 3.3 billion yen; an increase in depreciation expenses totaling 1.6 billion yen; hikes in raw material costs totaling 0.6 billion yen; and the impact of a change in the product mix and related factors totaling 3.8 billion yen. As a result, operating income decreased from the previous first quarter.

In the first quarter under review, the Company added Yamaha Motor Philippines, Inc. to its group of consolidated subsidiaries. This and other changes increased the number of consolidated subsidiaries at the end of the first quarter by one from the end of the previous year, to 112, while the number of companies accounted for by the equity method decreased by three, to 35.

Forecast business results

The Company announced its full-year forecast for fiscal 2008 on February 5, 2008, with the release of "Consolidated Financial Results for the Fiscal Year Ended December 31, 2007." The forecast projected 1,830 billion yen in net sales, 103 billion yen in operating income, 110 billion yen in ordinary income, and 59 billion yen in net income. However, business conditions surrounding the Yamaha Motor Group are dramatically changing, to a degree beyond what the Company had forecast at the beginning of fiscal 2008. Negative factors impacting Group performance include a rapid economic slowdown in the advanced nations, soaring crude oil and raw material prices, and exchange rate fluctuations. Therefore, the Company is currently reviewing its original forecast for the second half of fiscal 2008. As of this time, the Company has not revised the full-year forecast results for fiscal 2008 from the figures announced on February 5.

The forecast business results are based on the assumption that one U.S. dollar will trade at 105 yen during the year (an appreciation of 12 yen from the previous year), while one euro will equal 155 yen (an appreciation of one yen).


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