Ducati announces three-year plan
Officials at Ducati Motor Holding S.p.A. recently revealed details of a three-year plan to “re-launch” the brand.
The move comes in the wake of a downturn in business, the installment of a new majority owner and a new board of directors.
“A better revenue mix and the implementation of efficiency measures — expected savings on both structural costs and on the components purchasing process — will progressively enhance earnings,” company officials said in a prepared statement. “Net result will still be negative in 2006, will virtually break even in 2007 and will be positive in 2008.”
In its new plan, Ducati said a past focus on high margin units will turn into a more favorable revenue mix during the next three years. Company officials said modest sales growth is expected through 2008 — “especially after 2007, mainly driven by an expected higher average selling price given a more favorable product mix.”
Ducati said registrations (sell-out) during the 2006-2008 period will be stable and similar to 2005 levels. Company officials said shipments (sell-in) should be in line with registrations in 2008, but lag behind registrations in 2006 and 2007 to favor the reduction of dealer stock.
Ducati Motor Holding SpA ended 2005 with a loss of Euro 41.5 million ($52 million) compared to a loss of Euro 3.5 million ($4.4 million) in 2004. Revenue for 2005 was Euro 320.8 million ($402 million), down 11.7 percent compared to 2004.
While Ducati registrations in the United States were up 25.7 percent in 2005, total worldwide registrations during the year were down 3.5 percent compared to 2004. Revenue from motorcycles — 77.1 percent of total revenue — decreased 13.1 percent to Euro 247.2 million ($311 million).
Suzuki Cycle Sales Up 22%
Suzuki Motor Corp. said cost-cutting efforts, increased sales and beneficial foreign exchange rates combined for a 9 percent rise in year-end net profit.
Suzuki said net income for its fiscal year ended March 31 climbed to Y65.95 billion ($579 million) or Y125.64 per share, up from Y60.51 billion or Y112.94 per share during the same time last year. Operating income was up 5.9 percent to Y113.87 billion ($1 billion) on consolidated sales of Y2.746 trillion ($24.1 billion), which were up 16.1 percent from sales of Y2.366 trillion ($20.8 billion) last year.
Suzuki said it sold 3.061 million motorcycles and 2.067 million automobiles for the fiscal year ended March 31, up from 2.92 million two-wheelers and 1.89 million four-wheelers during the previous fiscal year.
Motorcycle division sales for the recent year totaled Y561.31 billion ($4.9 billion), up 21.9 percent. Motorcycle division operating income jumped 20.4 percent to Y45.93 billion ($404 million).
Automobile division sales for the recent year totaled Y2.12 trillion ($18.6 billion), up 14.9 percent. However, automobile division operating income fell 3.7 percent to Y57.93 billion ($510 million) due to higher expenses, the company said.
Sales of other products, including outboard motors, climbed 10.1 percent to Y65.21 billion ($574 million), generating operating income of Y10.01 billion ($88 million), up 8.2 percent.
Suzuki, which bought back 17 percent of its own shares from General Motors Corp. in April, forecasts net income of Y66 billion ($581 million) on sales of Y2.80 trillion ($24.6 billion) for the current year ending March 2007.
The company expects to sell 3.309 million motorcycles in 2007, up 8.1 percent from the recent year ended, and plans automobile sales of 2.211 million units, an increase of 7 percent.
Under a five-year business plan unveiled last year, Suzuki aims to lift group pretax income to approximately Y150 billion for the fiscal year ending March 2010, and to raise group sales to approximately Y3 trillion that year.