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Japan’s Subaru Pares Yearly Profit Scope on Yen after Typhoon Hits Japan

Subaru lowered its annual profit estimate on expectations of a stronger yen and the impact on production from a storm in October, driving its shares down as much as 4.5%.

Japan’s smallest major auto company, which is owned a fifth by top-ranked Toyota Motor, cut its forecast for operating revenue to 220 billion yen ($2 billion) for the year ending March 2020, from a previous projection of 260 billion yen.

Subaru reviewed its forecast for the yen to average 107 against the dollar over the period, from 110 previously.

A stronger currency bites into earnings because cars exported from Japan become dearer, and the value of profits made abroad decreases.

Typhoon Hagibis pressed Subaru to halt manufacturing at its factories in Gunma, north of Tokyo, for over a week last month due to supply chain interruptions.

The stoppage, which lasted until Oct. 25, resulted in lost manufacturing of 11,000 automobiles, Chief Executive Tomomi Nakamura told a briefing in Tokyo on Wednesday.

Hagibis was the worst typhoon to strike Japan in decades, leaving a minimum of 80 people dead, based on national broadcaster NHK.

Subaru further stated car sales surged around 20% in the first half of the fiscal year in contrast with a year earlier, pushed nearly entirely by an improvement in the US amid strong demand for the Forester SUV crossover.

Subaru shares were down 1% at 3,102 yen after reaching a low of 2,995.5 yen earlier.

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Bethany Pike

Bethany is working as the lead of the automobile column, and she is a student of physics and a very knowledgeable person. She is one of the youngest person working here. She is a total bookworm and loves spending her leisure time in the library reading books of all genres. The best part about her is she believes in manually searching out information for her articles, which makes them unique.

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