Please turn to page three. This is Matsuoka speaking. Now I would like to start the presentation. The COVID pandemic started in 2020, is almost brought under control, and the world is now focusing on normalizing the economic and social activities. Production constraints caused by the shortages of semiconductors and other components are in the process of being resolved, and the automobile production is increasing in many regions. The pace of recovery from the COVID pandemic varies in different regions, with inflation and the rising of interest rates to controlling inflation, slowing down the economy, deterioration of consumer confidence, and declining of purchasing power.
As shown in the slide, our fiscal year 2023 first quarter results improved significantly from the same period of the previous year, thanks to the improvement of sales quality and our net revenue strategy, which we have been promoting since FY 2021. Also a tailwind coming from the Forex. Net sales increased 20% year-on-year to JPY 635.8 billion. Operating profit increased 47% year-on-year to JPY 45.2 billion, and the operating profit margin rose 1.3 points to 7.1% from 5.8% in the same period last year. Ordinary profit increased 25% to JPY 61.8 billion. Net income after taxes increased 24% year-on-year to JPY 47.9 billion.
Due to inventory shortages in some regions and the change of a period of the product cycle amid intensifying competition, the retail sales volume declined 10% year-on-year to 195,000 units. Please turn to page four. This slide explains the factors behind year-on-year changes in operating profit for the first quarter of FY 2023. The volume and mix selling price showed a total favorable turnaround of JPY 30.5 billion, mainly due to increased volume in ASEAN, North America, and Europe, and mix selling price improvement from our net revenue strategy that we have been promoting. Sales expenses decreased by JPY 4.6 billion year-on-year as a result of strict management of incentives by monitoring the situation in each market and segment. The advertisement expenses were increased as planned, mainly for new model launches.
Procurement cost, shipping costs decreased the operating profit by JPY 15.2 billion in total due to the impact of raw material prices, which rose significantly from the second half of the previous fiscal year. Product enhancement and inflation, as well as the negative impact on the shipping cost caused by the vessel shortages, mainly on Oceania and European routes, although some were partially offset by procurement cost reduction. There were no significant changes in R&D expenses and other items. The impact at a profit was minor. Regarding the Forex, while the depreciation of the yen against the U.S. dollars and euro had a positive impact, the deterioration of the Thai baht, which is a cost currency for us, had a negative implication.
In total, the profit increased by JPY 14.4 billion year-on-year, and the profit increased on a constant currency basis as well. Please turn to page five. Next, I will explain the sales volume for the first quarter of FY 2023. Although overall demand was generally firm, inventory replenishment was delayed due to supply shortages of some vehicles by the shortage of some parts, as well as vessel shortages in Oceania, the Middle East, Europe, and other regions, resulting in a 10% year-on-year decrease to 195,000 units. The following pages show an overview of sales in our major regions. Please turn to page six. First, about the ASEAN region. PIV in the ASEAN countries seems to vary from country to country. Except for the Philippines, which is showing a solid growth even when goods prices continue to increase at high pace.
The overall recovery in demand is slow, although the degree of growth differs among the countries. Under this environment, our retail sales volume was 59,000 units, down by about 9% year-on-year. In Thailand, where we are in the change of a period of models, both volume and the market share decreased. In order to maximize the sales of new Triton, which will be launched shortly, we are promoting to clear up the inventory of old Triton and preparing for the sales from all aspects. In Indonesia, PIV recovery was slow, and in the commercial vehicle segment, which is subject to strict import quotas under the TPP, we lost the market share due to a delay in obtaining the import quota for TPP. Leveraging the new compact SUV, which will be launched in August, we aim to increase the overall market share.
In the Philippines, the high inflation is subsiding, and the country's central bank left interest rates unchanged in May. We secured a high market share as a result of increased sales of Mirage and other models, as well as our focus on Xpander and Triton, L300 as core models. Regarding TIV in Vietnam, the deterioration on business sentiment is becoming more serious. Going forward, the government support and other measures will be initiated, and automobile demand is expected to recover moderately. While closely monitoring these trends, we will strengthen our network to launch a new compact SUV and provide support, such as training for sales and service staff for the launch. In Malaysia, although there were concerns about the reactionary decline from the economic stimulus package in FY 2022, the sales have been stronger than expected.
Sales of our mainstay product, the Xpander, was strong, but sales of the Triton declined, due in part to reluctance to buy the current model in anticipation of the new launch of the new model. Please turn to page seven. About our domestic business. Although the TIV in Japan did not reach the pre-COVID-19 level, it has exceeded the previous year's level, consecutively since September 2022, indicating that the market is still on the road to recovery. Our sales for both registered cars and K-cars exceeded the previous year's level. Our K-cars continued to be affected by the parts supply shortages, so we could not link those models to our retail sales performance in a full manner. Delica Mini went on sales on May 25th, has maintained strong orders from pre-orders, and has already exceeded 20,000 units, far exceeding our expectation.
Together with the Delica D:5, we will do our best to promote the outdoor image and Mitsubishi Motors-ness to expand synergetic sales. At the same time, we will deliver the Delica Mini to customers who have been waiting for a long time at the earliest possible timing. We continue permeating and also establishing our branding to appeal our values. In addition, we will strengthen and consolidate all functions to achieve our sales plan by enhancing management support for dealerships and training for sales staff. Please turn to page eight. Next is the situation of our North American business. TIV in the North American market rose by 17% year-on-year, due to the vehicle supply shortages improved by a recovery in production and an increase in fleet demand.
In addition to the improved inventory level, we maintained strong sales momentums, especially in the Outlander and the Outlander PHEV. In particular, the new Outlander PHEV, which was launched in November last year in Canada, has been well received, resulting in a record high sales volume. Despite initial fears of recession, the consumer spending in the U.S. is stronger than expected. The sales environment is gradually normalizing as inventory tightness is easing and incentives are increasing. We will strive to expand the sales of the strong Outlander series while maintaining the quality of our sales activities. Next, CEO Kato will explain the FY 2023 forecast. Please, Mr. Kato, please. Please turn to page 10.
We recognize that the first quarter of FY 2023 got off to a solid start in a sales environment that was generally in line with our expectations. In particular, mix and selling price improvements have been accumulating due to the promotion of our net revenue strategy. In addition, the Japanese yen has weakened against the U.S. dollars and other currencies more than we assumed at the beginning of the fiscal year. Taking these factors into account, we have revised our full year forecast for FY 2023, as shown in this table. We have revised net sales from JPY 2,700 billion- JPY 2,780 billion.
Operating profit from JPY 150 billion-JPY 170 billion, ordinary profit from JPY 150 billion-JPY 170 billion, and net income from JPY 100 billion-JPY 110 billion. In the second quarter and beyond, we will continue to build a foundation for the next leap, by promoting our net revenue strategy and steadily succeeding in launching new models, although the macroeconomic environment is still highly uncertain, as we had assumed at the beginning of the term. Please turn to page 11. This slide shows the factors behind the changes in operating profit forecast for FY 2023 from the previous fiscal year.
We expect a total positive impact of JPY 115.8 billion on volume, mix, and selling prices, mainly due to the impact of new models to be launched one after another through the second half of the fiscal year, and the improvement of mix and selling prices by promoting the net revenue strategy, despite supply constraints due to semiconductor and vessel capacity shortages, and so on. As for selling expenses, we assume an increase in incentives as a result of changes in the competitive environment. We will also firmly increase advertising expenses in preparation for the new model launches, which will lead to a sales increase. Regarding procurement and shipping costs, we expect material cost hikes due to inflation and increase in energy and labor costs to proceed as forecasted at the beginning of the fiscal year.
Increase in R&D expenses and labor and general expenses are forecasted to continue within our expected range at the moment. Regarding the impact from foreign exchange rate, we have factored in the exchange rate for the first quarter, and the negative impact is now JPY 30.6 billion, compared to the negative impact of JPY 50.6 billion in our previous forecast. Please turn to page two. Net sales in the first quarter of FY 2023 were generally at the level incorporated in the plan at the beginning of the fiscal year. Retail sales volume declined year-over-year due to sluggish overall demand in ASEAN region, our main market, and the shortage of vessel capacity. From the second quarter onward, new models will be launched one after another around the world.
In addition to Delica Mini, which has been well received in the domestic market, the new Triton will be launched soon. After that, we will finally launch a new compact SUV as a strategic vehicle for the ASEAN market. In Europe, we expected to see the full fresh impact of new ASX and the Colt. In addition to the impact of new models, we expect the sales pace to gradually pick up as supply constraints ease and the market in ASEAN region recovers, which is expected in the second half of the year. Although we need to continue to pay attention to the market trends, we will execute what we need to do as planned, and do our utmost to achieve the sales plan of 917,000 units planned at the beginning of this fiscal year. Please turn to page 14.
In FY 2023, we continued to focus on product renewal and the introduction of new models. This year, we have already launched three models, as you can see here so far. In Japan, we launched the Delica Mini in May. Based on the concept of reliable and active super height wagon, Delica Mini is a super height wagon that combines a spacious interior with a powerful driving performance, and bears the name of Delica Minivan. Pre-orders have been accepted since January 2, 2023, and the friendly and Delica-like front face, large diameter 15-inch tires, and special shock absorbers, which are exclusive equipment for the four-wheel drive model, have been well received. The company has already received more than 20,000 orders, mainly from families and customers who want to enjoy outdoor activities.
Together with Delica D:5, we will further promote the outdoor image and the Mitsubishi Motors-ness. Next, in Europe, the sales of ASX began in March 2023. The test drive events held from January to February 2023 received a lot of positive feedback, and orders for ASX were off to a good start, exceeding 9,000 units at the end of June. On the other hand, both production and logistics capacities are inadequate, and many customers are still waiting. We will do our utmost to accelerate production and shipment so that we can promptly deliver our products to our customers who have been waiting for all those cars for a long time. Last June, we unveiled the new compact hatchback Colt for the European market.
Following ASX, the new Colt, which will be supplied by Renault on OEM basis, will adopt the alliance's CMF-B platform and be relaunched as a five-door compact hatchback in European market for the first time in nine years. The new Colt will be produced at the Renault's Bursa plant in Turkey, and will be available in Europe through Mitsubishi Motors sales network from October this year. As with ASX, the response to the announcement has exceeded our expectations, and we strongly believe this model will also increase MMC's sales in the second half of the year. In September, we plan to hold a test drive event for the press and gradually increase the presence in the market. Please turn to page 15. On July 26th, we will unveil our fully remodeled 1-ton pickup truck, the new Triton, in Thailand for the first time in the world.
In addition to its excellent durability, robustness, and off-road performance, the Triton has achieved the comfort and ride quality required for private use, and has been well received in ASEAN, Oceania, Central and South Americas, the Middle East, Africa, and other markets as a global strategic vehicle. The new Triton now is in its sixth generation, has a larger body size and powerful horizontal styling. The design concept is Beast Mode. In addition to the toughness and the strength required of a pickup truck, the design concept expresses an imposing appearance that is both robust and agile, typical of Mitsubishi Motors. The world premiere of the new Triton, a rugged and dependable pickup that makes you want to go on any adventure, is scheduled to be streamed live on our special website. We hope you will join us. Please turn to page 16.
We will have our world premiere for the new compact SUV at the upcoming 30th GAIKINDO Indonesia International Auto Show to be held from August 10th. The new compact SUV features our driving modes, including the Wet mode, first time for Mitsubishi Motors, to provide a safe, reliable, and comfortable driving in severe weather and road conditions. This new compact SUV to be launched in our core market, ASEAN region, with a stylish and powerful full-fledged SUV design that offers both comfort and practicality in a compact body size with easy handling, spacious interior, and a variety of storage spaces, and safe and reliable driving performance in various weather and road conditions, making everyday life exciting. It is SUV that makes everyday life exciting.
In addition, the minimum ground clearance, the highest level in its class, was secured to ensure safety even on rough road surfaces in consideration of the way compact SUVs are used in ASEAN region. The new compact SUV will be launched sequentially in ASEAN countries starting from Indonesia. In the future, we plan to add electrified vehicles to the lineup and expand the model to regions outside of the ASEAN region. We hope to develop it into a mainstay, a model like the crossover MPV Xpander, which has become a global strategic vehicle from ASEAN strategic model and is driving our sales. While the COVID-19 is finally on the verge of being resolved in 2023 after the three-year-long pandemic, the speed of recovery has been slow, probably due to the effects of global inflation and the monetary tightening to control it.
Economic growth rates have slowed significantly, especially in emerging countries. Amidst such an unstable business environment, we promoted our strategy to improve the sales quality or net revenue strategy, and tackled every issue with sincerity. With the tailwind of foreign exchange rate, we were able to achieve record profits for the first quarter. We believe that the first year of our new midterm business plan, Challenge 2025, got off to a solid start. Although the unstable business environment is expected to continue for the foreseeable future, the new Triton and the new compact SUV will soon be launched in ASEAN countries, and they will be leveraged to build a solid foundation for growth in the ASEAN region and boost our global sales volume as well. From this fiscal year, our company has entered into a new stage.
We will achieve our goals for FY 2023, the first year of the midterm plan, by taking on the challenges of further leaps and bounds continuously towards the next era of growth as a united company. Thank you very much for your attention.