Mazda posts $7.4 bln loss in March-ended year

Mazda Motor Corp. Tuesday reported a net loss for the recently-ended fiscal year nearly six times more than it had forecast in February, eliminated its year-end dividend and cautioned it expects another challenging year ahead.

Net losses for the fiscal year ended March 31 totaled 71.49 billion yen ($7.35 billion), or 52.13 yen a share, compared to a net profit of 91.84 billion yen, or 65.21 yen a share, in the prior financial year. Revenue fell 27% to 2.54 trillion yen from 3.48 trillion yen.

Mazda shares ended 4.6% lower Tuesday in Tokyo trading ahead of the after-hours release.
 
For the current fiscal year Mazda expects a 50 billion yen net loss and a 20% drop in sales revenue to 2.03 trillion yen. It forecast business conditions will be bad in the first half, but will improve in the second, helped in part by the rollout of its Mazda3 model and the effects of cost-cutting.

The Mazda3 was unveiled in North America this spring and will be launched in other markets around the world later this year.

Mazda had forecast Feb. 4 a net loss of 13 billion yen for the recently-ended fiscal year.  The automaker said the discrepancy was owing to a 28.26 billion yen impairment charge on fixed assets, a 19.27 billion yen loss on investment securities and a 17.14 billion yen valuation allowance on deferred-tax charges.

Mazda said it would not pay a year end dividend in light of what it described as "substantially deteriorated" results, compared to a 3 yen per share payout a year earlier.

Mazda said in a statement it has slashed labor costs, cut advertising and cut back on plant investment. Spending on research and development has also been curtailed.