Mitsubishi swings back to profitability in latest quarter on redesigned Outlander

TOKYO -- Mitsubishi Motors Corp. quickened the pace of recovery in the latest quarter, bouncing back to profitability on higher sales and lifting its full-year earnings outlook.

The Japanese automaker booked operating profit of 30.7 billion yen ($266.7 million) in the fiscal third quarter ended Dec. 31, reversing an operating loss of 4.1 billion yen ($35.6 million), the automaker said in a statement on Monday.

Mitsubishi also reported net income of 23.0 billion yen ($199.8 million) in the three-month period, compared with a net loss of 5.9 billion yen ($51.3 million) the same quarter a year earlier.

Global retail sales climbed 12 percent to 245,000 vehicles in the quarter, driven by robust demand in North America and Southeast Asia, despite tepid deliveries in Japan and Europe.

Revenue increased 39 percent to 525.5 billion yen ($4.57 billion) in the three months.

North American retail sales surged in the quarter to 40,000 vehicles, from 24,000 the year before, as Mitsubishi cashed in on the popularity of its redesigned Outlander crossover.

North American regional sales of the nameplate more than doubled over the first nine months of the year to 39,300 units, CFO Koji Ikeya said while announcing the financial results.

In the October-December period, Outlander sales in the U.S. more than tripled to 13,209 vehicles, making the imported nameplate account for more than half of the brand's volume.

Mitsubishi's European sales dipped to 35,000 units, from 36,000 vehicles the year before, while sales in the home market of Japan also retreated by 1,000 units to 15,000 in the quarter.

Parent company third-quarter results got a boost from higher volume and beneficial foreign exchange rates, which added 16.5 billion yen ($143.4 million) to Mitsubishi's bottom line.

Looking ahead, Mitsubishi upgraded its outlook for the full fiscal year ending March 31, thanks to stricter controls over sales expenses and a lift from favorable exchange rates.

It now expects to rebound from a big operating loss in the previous fiscal year to a 70.0 billion yen ($608.2 million) operating profit in the current fiscal year. That's up from an earlier target of 58.0 billion yen ($503.9 million). Net income will also recover from a loss and rise to 50.0 billion yen (434.4 million), higher than Mitsubishi's earlier forecast for 40.0 billion yen (347.5 million).

Discipline on spiff spending will help boost profitability despite a more complicated sales outlook. Mitsubishi tweaked its full-year wholesales target to 1.047 million units, from its earlier goal of 1.059 million vehicles. Still, both targets are up from the previous year's 824,000 units.

Mitsubishi sees global retail sales increasing 15 percent to 921,000 vehicles this fiscal year.