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Toyota’s Annual Earnings Drop 2 Percent

August 28, 1991

TOKYO (AP) _ Toyota Motor Corp., Japan’s largest automaker, said Wednesday its profit for the fiscal year ended June 30 fell about 2 percent.

Toyota said it earned 431.45 billion yen, or about $3.15 billion at the exchange rate at the end of the period, compared with 441.30 billion yen, or $3.22 billion, in the previous fiscal year.

Revenue rose 7.2 percent to 9.855 trillion yen, or $71.9 billion, from 9.193 trillion yen, or $67.1 billion.

The results include 37 consolidated subsidiaries, including Toyota Motor Sales U.S.A. Inc. and Toyota Motor Manufacturing U.S.A. Inc.

The drop in pre-tax earnings was even steeper, at 15 percent. That decline was the first since a 22 percent fall in fiscal 1987.

Toyota attributed the decline in pre-tax earnings to increases in research and development expenditures and personnel costs, indirect expenses at the parent company and substantial foreign-exchange losses due to the strong yen.

With capital investments growing, ″we are not optimistic about the results from the current fiscal year,″ said Shohei Kurihara, a Toyota executive vice president.

Toyota produced 4,118,000 vehicles in Japan during the year, up 2.3 percent, and 700,433 vehicles in the United States, Canada, Australia, Indonesia and Taiwan, up 15.3 percent, compared with fiscal 1990.

Sales in Japan totaled 2.443 million vehicles, up 0.7 percent from the previous year. Sales abroad totaled 2.095 million vehicles, up 4.6 percent.

Also Wednesday, Toyota said it has discovered it received 2.188 billion yen, or about $16 million, in compensation for securities-trading losses from Daiwa Securities Co. from October 1987 to March 1990.

Last month, Toyota denied it received such compensation.

The revelation was part of a continuing scandal among Japanese brokerage houses, which have admitted they compensated some major clients for losses. The news has angered small investors, who were not compensated.

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