Japanese carmaker Toyota has delivered record annual profits on the back of strong global sales.

Toyota, which this year may overtake General Motors as the world's biggest carmaker, said net income for the year to March 31 was 1.37 trillion yen ($12.3bn), up 17 per cent on a year ago.

Global sales for the twelve months jumped 13.5 per cent to 21 trillion yen.

The company also announced a better than expected 12.3 per cent rise in operating profit to 1.88 trillion yen.

Toyota attributed the encouraging results to a weaker yen, improved marketing and the introduction of successful cost cutting measures.

"Earnings trended upwards in the latter half of the fiscal year, resulting in positive year-on-year growth for the entire year," said Toyota president Katsuaki Watanabe.

"Although the effects of foreign currency exchange rates were contributing factors, Toyota's performance demonstrated the strength of our company's ongoing operational efforts."

Katsuaki Watanabe, Toyota: "Earnings trended upwards in the latter half of the fiscal year, resulting in positive year-on-year growth for the entire year."

In the year to March, Toyota's vehicle sales increased to 7.974 million units from 7.41 million.

In North America, vehicle sales rose 285,000 to 2.556 million, mainly due to the strong popularity of the Scion series and the Prius.

Sales in Asia climbed to reach 880,000 vehicles, an increase of 47,000 on a year earlier.

In Europe, the newly introduced Aygo contributed to a sales increase of 44,000 vehicles to 1.023 million.

Car sales in Africa, Oceania and South and Central America were also up on last year, Toyota said.

But in Japan, sales dropped by 17,000 vehicles to 2.364 million. Toyota’s Japanese market share for the year was 44.3 per cent, compared with 44.5 per cent a year ago.

Looking ahead, Toyota said it expects to sell more than nine million cars this year.

Watanabe added: "Our business environment will remain severe, with a significant increase in raw material prices and competition intensifying.

"However, we wish to achieve results that exceed our latest financial results while continuing investment for future growth."