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MMC announces worst ever first-half results

Mitsubishi Motors has revealed that its interim net loss nearly doubled to a record 146.16 billion yen (£744m) in the first half of the financial year - and has downgraded its full-year earnings forecast.

The company reported a net loss of 80.22 billion yen (£409m) a year earlier.

Japan's fourth-largest carmaker said its recurring loss also widened to a record 97.69 billion yen (£499m) in the six months to September from 85.79 billion yen (£437m), while revenue slumped 11.3 percent to 1.07 trillion yen (£5.5 billion).

For the year to March 2005, Mitsubishi forecast a net loss of 240 billion yen (£1.2 billion) and a recurring loss of 180 billion yen (£918m) on sales of 2.1 trillion yen (£10.7 billion), all revised down from its earlier projection of 230 billion yen (£1.2 billion), 150 billion yen (£765m) and 2.25 trillion yen (£11.5 billion), respectively.

Chief financial officer Hiizu Ichikawa said Mitsubishi Motors was "very sorry for the companies who have assisted us" as its share price has plunged this year.

"The only thing we can do now is to carry out our revival plan and raise the stock price over the medium to long-term," he said, announcing the worst first-half results in the company's 34-year history.

Hideyasu Tagaya, Mitsubishi president and chief operating officer, repeated that the company was pursuing deals with other carmakers to keep its factories running but that it has yet to reach any agreement.

Mitsubishi said vehicle revenues in Japan in the six months dropped 37.5% to 182.8 billion yen (£933m) while the key US market fell 15.6% to 237.3 billion yen (£1.2 billion).

In contrast, revenue in Europe rose 9.2% to 348 billion yen (£1.8 billion), thanks to a new Colt model and brisk sales in the UK, Russia and Ukraine, the company said.

Global sales fell 16 percent to 646,000 units for the first half and the company forecast full-year sales at 1.4 million, down from the 1.45 million projected in May and 1.53 million in the previous year.

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