TOKYO -- Toyota Motor Corp.'s $1.2 billion penalty for misleading American customers about unintended-acceleration defects took a bite out of the company's otherwise robust January-March earnings.
North America was one of the few regions where Toyota saw a decrease in operating profit, even as the company posted record full fiscal-year profits.
Operating profits in North America, Toyota's top market, fell 9 percent to ¥51.2 billion ($498.1 million) in the latest quarter, from a year earlier. North American retail sales rose 6 percent to 581,261 units, despite a 6 percent decrease in factory wholesales to 567,000. Revenues in the region rose 11 percent to $16.69 billion.
Toyota said the settlement with the Department of Justice, plus the cost of winding down manufacturing in Australia, resulted in one-time charges of $1.95 billion that ate into profits, but those were partially offset by currency gains and cost cutting.
Overall net income fell 5 percent to $2.89 billion in the quarter, as revenues rose 13 percent to $63.9 billion.
The penalty, announced in March, was contingent on a rare admission of wrongdoing: an acknowledgment that Toyota "misled U.S. consumers by concealing and making deceptive statements about two safety issues affecting its vehicles, each of which caused a type of unintended acceleration," according to a Department of Justice statement.
Despite the charge, full-year operating profit in North America climbed 47 percent to $3.17 billion.
"Increased vehicle sales and cost reduction efforts and other factors contributed to the growth of operating income," Executive Vice President Nobuyori Kodaira said of North American results.
For the fiscal year, North American retail sales rose 5 percent to 2.5 million units. Toyota forecast sales will rise 4 percent to 2.6 million in the current fiscal year that began April 1. Toyota said it expects the U.S. economy to remain relatively strong and the regional auto market to stay stable.
The fourth-quarter stumble came at the end of a fiscal year in which Toyota posted record net income and operating profits.
Global net income nearly doubled to a record $17.73 billion, while operating profit surged 74 percent to $22.30 billion. Revenues advanced 16 percent to $249.92 billion, as global unit sales rose 5 percent to 10.1 million.
