TOKYO -- Yamaha drummed up a record annual net profit of 54.3 billion yen ($495 million) thanks to soaring Chinese demand for high-quality acoustic pianos, guitars and other instruments.
That represents 16% growth in the bottom line in the year ended March 31, the Japanese manufacturer said Tuesday. Sales climbed 6% to 432.9 billion yen, with much of that coming from a 22% leap in mainland sales of musical instruments. Operating profit grew 10% to 48.8 billion yen.
"The [Chinese] market for various musical instruments has been developing, and it is extremely robust," Satoshi Yamahata, a managing executive officer, told reporters on Tuesday. Not only are children learning to play instruments, the target market has expanded to other demographics, such as adult women taking up music as a hobby, Yamahata explained.
China's growing middle class has been driving these dynamics. Yamaha has successfully cultivated a brand associated with quality, and is steadily winning market share from local rivals.
Meanwhile, in North America and Europe, sales of industrial audio equipment were strong.
Because Yamaha booked an extraordinary gain stemming from sales of securities last fiscal year, net profit is projected to plummet 26% to 40 billion yen during the current financial year. Sales are expected to inch up 2% to 442 billion yen.
The annual dividend will rise 4 yen to 56 yen a share for the year ended in March. The payout will likely grow another 4 yen this fiscal year. Effective June 26, Yamaha will retire treasury stock equivalent to 2.9% of outstanding shares.