April 27, 2018 / 6:55 AM / 3 months ago

UPDATE 1-Mazda sees stronger yen hitting full-year profit

    * Sees operating profit down 28 pct in year through March
    * Assumes U.S. dollar rate 107 yen vs previous year's 111
yen  

 (Adds details and background)
    TOKYO, April 27 (Reuters) - Mazda Motor Corp         
forecast a 28 percent drop in full-year operating profit on
Friday, hurt by a stronger yen as well as higher spending.
    Japan's fifth-largest automaker said it expects operating
profit to slide to 105 billion yen ($960.8 million) in the year
through March, missing a median forecast for 136.9 billion yen
from 19 analysts polled by Thomson Reuters I/B/E/S.
    For the year just ended, its operating profit rose 16.5
percent to 146.4 billion yen, also below market forecasts.
    Mazda continues to expand globally, extending its six-year
run of rising vehicle sales. But as one of Japan's smaller
automakers, it faces growing costs to stay competitive in an
industry which is being disrupted by new technologies, including
self-driving cars and electric vehicles.
    It is also investing in a new plant in the U.S. state of
Alabama, a joint project with Toyota Motor Corp          which
will give Mazda a production foothold in the country. 
    The company forecast higher capital expenditure as well as
research and development costs in the current year.
    The automaker, which is highly exposed to currency swings
due to its heavy reliance on exports from Japan, is assuming an
average dollar rate of 107 yen this year, versus 111 yen last
year. Its view on the euro was unchanged at 130 yen.
    Mazda forecast global vehicle sales to rise 2 percent this
year to a record 1.66 million units. 
    Mazda imports all of the vehicles it sells in the United
States, making it vulnerable to rising costs if Washington
imposes trade restrictions on foreign-made cars.
($1 = 109.2800 yen)

 (Reporting by Naomi Tajitsu; editing by Darren Schuettler)
  
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