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Mitsubishi’s quarterly profit gains paced by Europe

Europe was Mitsubishi Motors Corp.’s most profitable region in the fiscal first quarter ended June 30, the company said today.

Europe’s operating profit of 12.6 billion yen ($124.3 million) nearly tripled from the year-earlier period, as revenues soared 73 percent to $1.45 billion. Unit sales there rose 11 percent, led by the launch of the Outlander plug-in hybrid.

Mitsubishi’s operating loss in North America narrowed by $1 million to $21.7 million in the quarter, as revenues rose 8 percent to $471.4 million.

Overall, Mitsubishi’s net income in the quarter surged 71 percent to $277.7 million, as revenues jumped 25 percent to $5.07 billion. Operating income soared 93 percent to $305.3 million.

The automaker said an improved model mix, cost cuts and favorable foreign exchange rates contributed to the profit increase.

The biggest contributors to the $147.2 million increase in operating profit, for example, were an $81.9 million currency gain, a $64.1 million improvement in volume and mix, and a $34.5 million gain on lower raw material costs and other cost reductions. Those gains were partially offset by a $37.5 million increase in indirect labor costs as well as reduced parts sales.

For the full fiscal year that began April 1, Mitsubishi predicts net income will rise 5 percent over the previous year to $1.08 billion, on a 10 percent gain in revenues to $22.68 billion, with operating income of $1.33 billion, up 9 percent.

In Europe, Mitsubishi expects net income for the full fiscal year to rise 29 percent to $473.4 million, on a 14 percent rise in revenues, to $5.42 billion.

That will make Europe the company’s highest-revenue region, ahead of Asia outside of Japan, where revenues are predicted to be $5.33 billion, up 30 percent. In Japan, revenues are forecast to rise 5 percent to $4.93 billion, producing operating profits of $29.6 million, nearly tripling from the prior year.

Mitsubishi also predicts North America will achieve breakeven this fiscal year, vs. a year-earlier loss of $37.5 million.