Mixed bag for Yamaha results

Yamaha has released its full year financials with group sales down but income up and music net sales down but ahead of forecasts.

Although full year sales declined year-on-year, income increased for the fifth consecutive year.

Musical instrument sales decreased from the previous year due to the impact of exchange rates and transfer of music school operations, but strong group performance in all markets, including double-digit growth in actual sales in China, drove an increase in total group income from ¥40.7 billion to ¥44.3 billion.

Operating income in music was slightly up from ¥31.7 billion to ¥32.1 billion, very slightly ahead of a forecasted ¥32 billion. Music net sales (excluding music schools) were down from ¥216.1 billion  to ¥203.3 billion.

The Chinese music market achieved double-digit growth, and sales were also described as “favourable” in North America, Europe, and other markets. Guitar sales were described by the firm as “brisk”, and key acoustic and digital pianos also showed strong sales, with almost all product categories achieving actual growth.

Cost reduction measures, revision of selling prices, higher actual sales, and reduction of SG&A expenses absorbed the impact of exchange rates.

Sales in the audio equipment segment were also down due to the impact of exchange rates, but solid results in the Japanese, North American, and European markets boosted income above the previous year to exceed ¥10 billion.

Full year net income was higher than the previous year and surpassed previous projections to reach a new record.

The year-on-year increase was chiefly due to posting ¥13.5 billion in deferred tax assets.

Although a one-time amortisation of goodwill for subsidiaries was recorded, previous projections were exceeded mainly due to a rebound from structural reform expenses incurred in association with transfer of resort facilities.