Summary of Business Results for the Fiscal Year Ended December 31, 2014

February 12, 2015

Consolidated business results

IWATA, February 12, 2015 –Yamaha Motor Co., Ltd. (Tokyo: 7272) announced today that consolidated business results for the fiscal year ended December 31, 2014 showed an increase in both sales and income across all business segments.
Net sales were 1,521.2 billion yen, an increase of 110.7 billion yen (+7.9%) compared with the previous fiscal year. Sales increases were seen in all business segments, thanks to increased sales brought about by the expansion of product lineups, increased products in higher price ranges, and the effect of yen depreciation caused by the appreciation of developed-country currencies.
Operating income was 87.2 billion yen, an increase of 32.1 billion yen (+58.2%), and we have achieved the target of our current (2013-2015) medium-term management plan (to reach operating income of 80 billion yen by 2015) ahead of schedule. In developed markets, income increased as the effects of income increase and yen depreciation outweighed increases in various expenses such as on research and development. Businesses in emerging countries also experienced income increases as the effect of income increases and cost reduction outweighed the expenses such as the increase in procurement costs due to currency depreciation.
Ordinary income was 97.3 billion yen (an increase of 37.2 billion yen or 61.9% against the same period the previous year), and net income for the period was 68.5 billion yen (an increase of 24.4 billion yen/55.4%).
For the fiscal year, the U.S. dollar traded at 106 yen (a depreciation of 8 yen from the previous fiscal year), and the euro at 140 yen (a depreciation of 10 yen).

Results by business segment

Motorcycles

Global net sales of motorcycle products were 977.6 billion yen (an increase of 49.4 billion yen/5.3% compared with the same period in the previous fiscal year), and operating income was 22.9 billion yen (an increase of 14.6 billion yen/174.0%).
In developed markets, sales increased (+13% compared with the same period in the previous fiscal year) thanks to the bottoming-out of overall demand and new product launches. In emerging markets, sales in India increased (+23%) thanks to an increase in overall demand and new product launches; sales in the ASEAN region fell (-9%) due to a decrease in overall demand and a drop in product strength. Unit sales of the business overall was 5.8 million units (-4%).
Major new product releases include the MT-09 and MT-07 models of the MT series, which aims to create a category that is uniquely Yamaha, the R1 and R25 models of the R-series, which adopts the company's racing technologies, the ASEAN commuters Nozza Grande, Grande Filano, and Mio125 that feature the next-generation air-cooled platform engine BLUE CORE, and the Cygnus α scooter and sports model FZS FI for the Indian market.
Sales increased overall as net sales increases in developed markets and India etc. outweighed the net sales decrease in ASEAN markets. Income also increased as the effect of income increases, cost reductions, and yen depreciation outweighed the effects of currency depreciation in emerging countries and increases in various expenses such as on research and development.

Marine

Net sales of the marine segment were 276.4 billion yen (an increase overall of 33.0 billion yen/13.6% compared with the same period in the previous fiscal year), and operating income was 45.8 billion yen (an increase of 14.0 billion yen/44.1%). The business segment has been in a transitive phase to a high-profitability business model through high brand strength, such as total business strength, reliability, and network strength.
In North America, the sales increase of large outboards was pronounced as total demand recovers in lake, river and marine markets, and as product demand is shifting from inboard engines to outboards. Sales also increased in emerging countries.
Major new product releases include the large-displacement engine F175, medium-displacement engine F115, Thai-manufactured small-displacement engines F4/5/6, and personal watercraft of new technology, FX/FZS.
Sales and income had increased for outboards due to the sales increase of large-displacement engines, cost reductions, and the effect of yen depreciation. Sales and income of boats and personal watercraft had also increased thanks to the introduction of new products.

Power Products

Net sales of the power products segment were 142.2 billion yen (an increase overall of 15.5 billion yen/12.2% compared with the same period in the previous fiscal year), and operating income was 6.5 billion yen (an increase of 1.3 billion yen/23.9%).
Sales of Recreational Off-highway Vehicles (ROV) increased, thanks to the introduction of the second model VIKING VI. Sales of snowmobiles and golf cars also increased, resulting in sales and income increases overall.

Industrial Machinery & Robot Products

Net sales of the industrial machinery and robots business were 38.9 billion yen (an increase of 6.7 billion yen/20.7% compared with the same period in the previous fiscal year), and operating income was 5.0 billion yen (an increase of 2.0 billion yen/63.8%).
Sales of surface mounters increased in China, Asia, and Europe, thanks to the recovery of equipment investment demand as well as the introduction of new medium- to high-speed products. In addition, the company has begun preparing for full-scale involvement in the high-speed equipment market through asset transfer from Hitachi High-Technologies.

Other Products

Net sales in the other products business were 86.1 billion yen (an increase of 6.2 billion yen/7.7%), and operating income was 7.0 billion yen (an increase of 0.3 billion yen/5.2%).
Sales of electrically power assisted bicycles increased, thanks to the expansion of models equipped with the triple sensor system and the increase of exports of the E-Kit drive system to Europe. In addition, the next-generation smart power Green Core and electric scooter E-VINO that delivers both performance and affordability were introduced to the market.
Sales of automobile engines also increased, resulting in sales and income increases overall.

Forecast of business results for the fiscal year ending December 31, 2015

For the next fiscal year, which is also the final year of the current medium-term plan, the company expects to continue to increase sales and income in all business segments.
On the sales front, the company is planning to increase sales in all business segments through various means such as: further expansion of product lineup (through introduction of global models, etc.) and high-price range products in the motorcycle business; expansion of the engine product lineup, release of products in higher price ranges, and boat strategy in the marine business; and expansion of product lineup including Recreational Off-highway Vehicles (ROV) in the power products business. Income increases are forecast for all business segments due to sales increases and cost reduction effects. In the motorcycle business, the company expects the operating income ratio to reach the 5% level by achieving profitability in developed markets and further improving the income in emerging markets.
In the marine business, the company expects an operating income ratio level of 20% by expanding sales of products in higher price ranges and reducing costs.

Yamaha Motor has been improving its profitability structure and financial resilience through the current medium-term plan.
As a result, in the fiscal year ending December 31, 2015, the company expects to approach its best results on the income front. On the financial front, the company expects to exceed 500 billion yen in equity, income per share of over 200 yen, and maintain ROE at 15%. The company will therefore target a pre-financial-crisis level (the fiscal year ended December 31, 2007), both in terms of income and financial resilience.
These forecast figures are based on the U.S. dollar trading at 115 yen during the fiscal year (a depreciation of 9 yen from fiscal 2014), and the euro at 130 yen (an appreciation of 10 yen from fiscal 2014).

Dividends

Regarding the final dividend for the current fiscal year, a dividend of 25.50 yen per share is planned to be placed on the agenda of the 80th Ordinary General Meeting of Shareholders, scheduled for March 26, 2015.
Added to the interim dividend (14.50 yen per share), this gives a total dividend for the year of 40 yen per share.
In addition, the dividend payment for the next fiscal year is scheduled to be 44 yen per year (22 yen at interim, 22 yen at final), based on the dividend ratio (consolidated) of 20% as per forecast consolidated business results.