Cfas Narrative 1

BURGOS, Maryden
BSACC 1-2 | CFAS Project - Set of Financial Statements
NARRATIVE REPORT: Toyota Industries Corporation Background and

Consolidated Financial Statements Analysis
A quick background on Toyota Motor Corporation, it is a global Japanese automotive

company with its headquarters in Toyota City, Aichi, Japan. Kiichiro Toyoda established
it, and became a corporation on August 28, 1937. As one of the biggest automakers in
the world, Toyota produces around 10 million automobiles annually.
The business was initially established as a subsidiary of Toyota Industries, a

manufacturer of machines that Kiichiro Toyoda's father, Sakichi Toyoda, created. The
Toyota Group, one of the biggest conglomerates in the world, now includes both
businesses. The firm created its very first product, the Type A engine, in 1934 while it
was still a division of Toyota Industries, and its first passenger automobile, the Toyota
AA, in 1936. Since the 1997 launch of the Toyota Prius, Toyota has been praised for
being a pioneer in the design and marketing of more fuel-efficient hybrid electric
vehicles. The business now offers more than 40 different hybrid car models for sale
worldwide.
As of 2022, the Toyota Motor Corporation produces vehicles under four brands:
Daihatsu, Hino, Lexus and the namesake Toyota. The company also holds a 20% stake
in Subaru Corporation, a 5.1% stake in Mazda, a 4.9% stake in Suzuki, a 4.6% stake in
Isuzu, a 3.8% stake in Yamaha Motor Corporation, and a 2.8% stake in Panasonic, as
well as stakes in vehicle manufacturing joint-ventures in China (FAW Toyota and GAC
Toyota), the Czech Republic (TPCA), India (Toyota Kirloskar) and the United States
(MTMUS).
Provided in the following pages are the financial statements as well as the notes to
financial statements of Toyota Industries Corporation For the Year Ended, March 31,
2022. Please refer to those financial statements as I relay to you the analysis of those
financial data included.
In the year 2022, economic activities resumed thanks to the progress on COVID 19
vaccinations worldwide, which in turn prompted the global economy to recover, while the
spread of COVID 19 infections shows no signs of subsiding. The momentum of the
recovery is waning, however, due to semiconductor shortages, shipping delays caused
by container shortages and the adverse effects of the Russian invasion of Ukraine that
began near the end of 2022. Meanwhile, the Japanese economy was also on a recovery
trend, albeit belatedly, but its pace is likewise slowing down. In this operating
environment, Toyota Industries undertook efforts to ensure customer trust by placing
priorities on quality and to expand sales by responding flexibly to market trends As a
result, total consolidated net sales amounted to 2,705.1 billion yen, an increase of 586.8
billion yen, or 28%, from the previous fiscal year.
BURGOS, Maryden
BSACC 1-2 | CFAS Project - Set of Financial Statements
The Automobile market recovered moderately overall, with an increase in Asia. Amid
such operating conditions, net sales of the Automobile Segment totaled 792.8 billion
yen, an increase of 201.2 billion yen, or 34%. Operating profit amounted to 33.0 billion
yen, an increase of 28.3 billion yen, or 590%. On the other side, regarding the Materials
Handling Equipment, the market was strong overall, with the expansion in North America
and Europe. Amid this operating climate, net sales of the Materials Handling Equipment
Segment totaled 1,789.4 billion yen, an increase of 358.0 billion yen, or 25%. Sales of lift
trucks, a mainstay product of this segment, increased primarily in Europe. Operating
profit amounted to 113.6 billion yen, an increase of 3.7 billion yen, or 3%, from the
previous fiscal year.
Toyota Industries' primary capital needs are twofold, specifically, long-term capital needs
for research and development, capital investment, M&A and others as well as working
capital needs for purchasing raw materials and parts for manufacturing the Toyota
Industries' products and for manufacturing costs and selling, general and administrative
expenses. As for returning profits to shareholders, it is determined to pay dividends at
the consolidated dividend payout ratio of around 30%.
Lastly, about the consolidated financial statement of cash flows, the net cash provided by
operating activities was 321.0 billion yen in 2022 due to posting profit before income
taxes of 246.1 billion yen. Net cash provided by operating activities decreased by 61.3
billion yen compared to that of 382.3 billion yen in the previous fiscal year. Net cash
used in investing activities was 229.8 billion yen in 2022, attributable primarily to
payments for purchases of property, plant and equipment of 237.3 billion yen. Net cash
used in investing activities increased by 174.3 billion yen compared to that of 404.1
billion yen in the previous fiscal year. Net cash used in financing activities was 92.1
billion yen in 2022, due mainly to repayments of corporate bonds of 184.0 billion yen.
Net cash used in financing activities increased by 13.3 billion yen compared to that of
105.4 billion yen in the previous fiscal year. After adding translation adjustments and
cash and cash equivalents at beginning of period, cash and cash equivalents as of
March 31, 2022 stood at 247.0 billion yen, an increase of 8.8 billion yen, or 4%, from the
end of the previous fiscal year

Cfas Narrative 1

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BURGOS, Maryden

BSACC 1-2 | CFAS Project - Set of Financial Statements

NARRATIVE REPORT: Toyota Industries Corporation Background and

A quick background on Toyota Motor Corporation, it is a global Japanese automotive

The business was initially established as a subsidiary of Toyota Industries, a

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