Yamaha Motor Consolidated Business Results Summary, First Quarter of Fiscal Year Ending December 31, 2020

May 29, 2020

IWATA, May 29, 2020—Yamaha Motor Co., Ltd. (Tokyo: 7272) announces consolidated business results for the first quarter.
Net sales for Yamaha Motor Co., Ltd.'s consolidated cumulative period for the first quarter of the fiscal year ending December 31, 2020 were 395.9 billion yen, (a decrease of 33.5 billion yen or 7.8% compared with the same period the previous fiscal year), and operating income was 25.4 billion yen (a decrease of 10.5 billion yen or 29.2%).

Net sales have been greatly affected by the COVID-19 (novel coronavirus) pandemic since March, and therefore income has decreased due to the lower number of units sold in the Land Mobility Business and Marine Products Business.
Operating income declined due to the impact of foreign exchange rates, a decrease in the number of outboard motor units sold in the marine products business, and the impact of Yamaha Motor Robotics Holdings Co., Ltd. (YMRH), which became a subsidiary at the end of the second quarter of the previous fiscal year.
Ordinary income was 26.8billion yen (a decrease of 10.7billion yen or 28.5% compared with the same period the previous fiscal year), and net income for the period attributable to owners of parent was 9.6billion yen (a decrease of 18.7 billion yen or 66.1%).
For this first three months consolidated cumulative period, the U.S. dollar traded at 109 yen (an appreciation of 1 yen from the same period the previous fiscal year), and the euro at 120 yen (an appreciation of 5 yen).

Results by Business Segment

Land Mobility

Net sales were 260.3 billion yen (a decrease of 19.1 billion yen or 6.8 % compared with the same period the previous fiscal year), and operating income was 8.6 billion yen (a decrease of 0.7 billion yen or 7.4%).
Unit sales of motorcycles in developed markets decreased due to the impact of the COVID-19 pandemic from March resulting in a decline in sales. However, the deficit was narrowed due to an increase in unit production at headquarters and in Europe, along with improvements in the model mix for Europe.
In emerging markets, sales and income from motorcycles have declined due to factors such as the deterioration of the model mix in Vietnam, decreased demand due to the introduction of new emission regulations in India, and the impact of the COVID-19 pandemic. The Philippines have also seen declines due to the effects of its volcanic eruption and the COVID-19 pandemic. As a result, there was an overall decrease in sales and income in the Land Mobility Business.

Marine Products

Net sales were 90.8 billion yen (a decrease of 13.1 billion yen or 12.6% compared with the same period the previous fiscal year), and operating income was 15.5 billion yen (a decrease of 5.9 billion yen or 27.5%).
In addition to a decline in the income ratio due to production adjustments for outboard motors, the number of outboard motor units sold also decreased due to the impact of the COVID-19 pandemic that began to emerge in March, further resulting in lower unit sales and income.

Robotics

Net sales were 17.9 billion yen (an increase of 2.6 billion yen or 17.0% compared with the same period the previous fiscal year), and operating income was 0.3 billion yen (a decrease of 2.1 billion yen or 89.3%).
Although unit sales of surface mounters increased in Asia, investment in the automotive domain was curbed due to the impact of the COVID-19 pandemic. The model mix of surface mounters also worsened, and the impact of YMRH becoming a complete subsidiary of Yamaha Motors (operating loss of 1.2 billion yen) resulted in an increase in overall net sales but a decrease in income.

Financial Services

Net sales were 11.8 billion yen (an increase of 1.8 billion yen or 17.5% compared with the same period the previous fiscal year), and operating income was 1.3 billion yen (a decrease of 0.7 billion yen or 33.8%).
Through the development of our own financial programs in US prime segments, we are now able to provide financial programs for all levels of individual customers and sales channels as our own services. As a result, sales increased due to an increase in the receivables balance, however net sales increased with decreased income due to an increase in the allowance for doubtful accounts in anticipation of the COVID-19 pandemic impact.

Other

Net sales were 15.1 billion yen (a decrease of 5.6 billion yen or 27.0% compared to the previous fiscal year), with an operating loss of 0.3 billion yen (the previous fiscal year showed an operating income of 0.8 billion yen).
Unit sales of products such of golf cars and generators decreased, leading to a decrease in sales and income.

Forecast of Consolidated Business Results:

The COVID-19 (novel coronavirus) pandemic has spread in Japan and throughout the world, and the prospects for the ending of it are unclear. In addition, the governments of many countries around the world have taken actions in response such as issuing directives to stay at home. With regard to the Consolidated Business Results for the fiscal year ending December 31, 2020, a consequent decrease in net sales is anticipated, and therefore estimating forecast business results and dividend payments are problematic in the current circumstances. For this reason, the forecast results announced on February 12, 2020 were withdrawn on April 24, 2020 and remain undecided. Yamaha Motor will therefore make a new announcement when making projections becomes possible again.

Basic policy concerning profit distribution and dividends for the current fiscal year

Recognizing that improvement of shareholders' benefit represent one of the Company's highest management priorities, the Company has been striving to meet shareholder expectations by working to maximize its corporate value. With regards to dividends, the Company is aiming toward a payout ratio of 30% of net income attributable to owners of parent, and focusing on achieving a balance of growth investment and shareholder returns within the scope of cash flow while maintaining earning power.
In terms of the interim dividend at the end of the second quarter (June 30, 2020), the board of directors meeting held on May 29, 2020 has decided to forgo the dividend in view of the market environment and the business conditions of the Company. With regards to the undecided end-of-term (December 31, 2020) dividend forecast, we will therefore make a new announcement when making projections becomes possible.