Thursday, 19 February 2015

Toyota Caetano 2014Q4 summed up

Fourth quarter 2014 relevant info summed up:
Vehicles produced: 213+178+158=549 (278 in 2013Q4, 248 in Q1, 513 in Q2 and 354 units in Q3)
Vehicles sold: 793+825+1227=2848 (2086 units in Q3)
Industrial machines forklift market: 89+133+221=443  (324 units Q1, 377 units Q2 and 302 units Q3)

Production:  there was a 36 units (7%) increase in production compared to Q2. As such, I would expect slightly better results
Commerce: 2848 vehicles (2086 in Q3, a 36,5% increase). I would expect gross margins to stay low, but the higher volume with fixed remaining costs should lead to an asymmetric increase in profitability. In addition, the market share objective by Toyota was finally achieved in December (the unit sales increase was already almost certain before). I cannot be sure if it is the case here but sometimes auto companies give incentives if objectives are achieved, which would lead to a bigger profit increase.
The industrial machines commerce unit relevance for short term profits is little, but it is important in the long term, as mentioned in previous posts.

Segmental results: I was modeling my predictions  using the same model I used in previous quarters. This obviously is not the most accurate way to do it, but since quarterly profits are not that important (and predicting them is not important at all) I was using it. However, I believe that could be leading me to some mistakes in my analysis to business performance. Looking at operational profit seems to be a better way to do it, and the difference between operational profit and net profit in some cases explains some of the doubts I had previously. I will not present an estimate this time since I believe I would be even less accurate than on previous quarters and there is no need to make a fool of myself, I will have plenty of opportunities in the future. 

Disclaimer: my selling offer at 1.07 was not fulfilled. Unfortunaly since my opportunity window disappeared with a more than 40% gain on the target stock while Toyota Caetano price has fallen. Not that I believe that this fall in price is of any importance but the 40% gain I did not achieve together with the opportunity lost to switch back to Toyota Caetano is relevant. In fact, since the price had fallen so much I ended up adding some Toyota Caetano shares at 0.84€. I should remember you that you should read all previous disclaimers on Toyota Caetano and the introduction post.

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