Toyota Profits Continue To FallZacks Investmentupdated Nov 08, 2011TweetAt GET.com we maintain complete editorial integrity on our content & provide transparent & unbiased information. Companies don't pay us to include their products although we receive a compensation when you successfully apply to products from our partners. See how we make money here.At GET.com we maintain complete editorial integrity.Toyota Motor Corp. (TM) posted an 18.5% fall in profit to ¥80.42 billion ($1.03 billion) in the second quarter of fiscal year ended September 30, 2011 from ¥98.69 billion in the same quarter of prior fiscal year. On a per share basis, profits were ¥25.65 (33 cents) versus ¥31.47 in the second quarter of fiscal 2011, missing the Zacks Consensus Estimate of 52 cents. The continuous decline in profit was attributable to a fall in production volumes and sales volumes all over the world, especially Japan, North America and Europe due to disruptions in supply of parts caused by the earthquake and tsunami in Japan on March 11, 2011. Revenues in the quarter ebbed 5% to ¥4.57 trillion ($58.56 billion) on a 5% fall in sales volume to 1.81 million units. Vehicle sales dipped 14% to 504,780 units in Japan and 20% to 413,836 units in North America. However, it increased 3% to 186,873 units in Europe, 23% to 355,315 units in Asia, and 6% to 344,728 units in Other regions. Operating income in the quarter nosedived 32% to ¥75.39 billion from ¥111.46 billion in the second quarter of the previous fiscal year.Segment Results In the Automotive segment, revenues slid 5% to ¥4.18 trillion. The segment had an operating loss of ¥7.47 billion compared with an operating profit of ¥32.97 billion in the prior fiscal year. The decrease in operating income was attributable to decreases in both production and sales volumes and the negative impact of changes in exchange rates. In the Financial Services segment, revenues sagged 8.5% to ¥271.05 billion. However, operating profit increased to ¥76.39 billion from ¥68.60 billion in the prior-year quarter. In All other businesses, revenues appreciated 9% to ¥255.14 billion. Operating income decreased to ¥9.94 billion from ¥10.73 billion a year ago.Financial Position Toyota had cash and cash equivalents of ¥1.76 trillion as of September 30, 2011 compared with ¥2.08 trillion as of March 31, 2011. Long-term debt stood at ¥11.39 trillion as of September 30, 2011, reflecting a stable debt-to-capitalization ratio of 53% compared with 54.5% as of March 31, 2011. In the first six months of fiscal 2012, Toyota’s net cash flow from operations deteriorated to ¥489.36 billion from ¥1.23 trillion in the same period of prior fiscal year, primarily driven by lower profit and a decrease in deferred income taxes. Meanwhile, capital expenditures (net) increased to ¥299.38 billion from ¥262.92 billion a year ago.Outlook Toyota did not provide any guidance for vehicle unit sales, net revenues and earnings for the fiscal year ending March 31, 2012. The company revealed that it needs more time to complete the examination of production and sales plans due to the impact of floods in Thailand.Zacks Rank Toyota is the leading automaker in the world in terms of sales and production. Its product portfolio consists of a full range of models of passenger cars, minivans and trucks as well as related parts and accessories. Its domestic competitor includes Honda Motor Co. (HMC) and Nissan Motor Co. (NSANY). Due to the disappointing results and the absence of any sales and earnings outlook, the company retains a Zacks #4 Rank, which translates into a “Sell” rating for the short term (1 to 3 months). (Exchange rate: $1 = ¥78.09) HONDA MOTOR (HMC): Free Stock Analysis Report Editorial Disclosure: Any personal views and opinions expressed by the author in this article are the author's own and do not necessarily reflect the viewpoint of GET.com. The editorial content on this page is not provided by any of the companies mentioned, and has not been reviewed, approved or otherwise endorsed by any of these entities. Opinions expressed here are author's alone, not those of the companies mentioned, and have not been reviewed, approved or otherwise endorsed by any of these entities.