COVID-19 hits Suzuki Motor's operating income; sinks by 98%

AgenciesUpdated: Tuesday, August 04, 2020, 12:51 AM IST
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Financialexpress

Suzuki Motor Corp on Monday said its consolidated operating income for the first quarter ended June 30 declined by 61.4 billion yen (97.9 per cent) to 1.3 billion yen, hit by a sales drop in its largest market India which continued to reel under the coronanvirus pandemic.

The company's consolidated net sales decreased by 482.2 billion yen (53.1 per cent) to 425.3 billion yen during the April-June period, Suzuki Motor Corp said in a statement.

"This is owing to the spread of the new coronavirus pandemic, which impacted the plant operations of the company's production sites in countries including Japan, India, Pakistan, and Hungary, as well as sales in countries worldwide," it noted.

The company said 15.4 billion yen equivalent to fixed expenses related to production suspension due to lockdown in countries including India and Hungary was accounted as extraordinary loss during the period under review.

Suzuki said total net sales for the automobile business (four-wheelers) decreased by 449.6 billion yen (55 per cent year-on-year) to 367.5 billion yen in the first quarter ended June 30, 2020.

The company's net sales decreased by a massive 83 per cent in India, 27.6 per cent in Japan and 54.3 per cent in other areas year-on-year, Suzuki Motor Corp said.

Suzuki said due to fall in net sales, its operating income for the automobile business in the April-June period decreased by 54.6 billion yen to 24 million yen year-on-year.

Due to the COVID-19 situation in India, the company did not give any business forecast.

"As the new coronavirus pandemic is spreading in the company's major market of India, we are currently unable to rationally calculate the forecasts. Therefore, the announcement of forecasts for consolidated operating results remains undetermined," it added.

Maruti Suzuki India (MSI), which is majority-owned by Suzuki, has been impacted due to coronavirus-led lockdowns in the country.

For the first quarter ended June 30, the auto major has reported its first-ever quarterly loss since going public 17 years back with a consolidated net loss of Rs 268.3 crore, hit hard by the coronavirus pandemic.

The auto major, which got listed way back in July 2003, had posted a consolidated net profit of Rs 1,376.8 crore in the April-June quarter of 2019-20.

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