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Higher Spending Trims Honda’s Profit
Honda Motor Co. blames higher spending on product development, factory launches and a less profitable sales mix for a 7% drop to 122 billion yen ($1.2 billion) in net income in the fiscal first quarter ended June 30.
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Honda Motor Co. blames higher spending on product development, factory launches and a less profitable sales mix for a 7% drop to 122 billion yen ($1.2 billion) in net income in the fiscal first quarter ended June 30.
The company's revenue jumped 16% to 2.83 trillion yen ($28.7 billion). Demand for Honda's motorcycles and ATVs rose 4% to slightly more than 4 million units. But car and truck sales were virtually flat at 858,000 units, and power products sales slipped 2% to 1.6 million units.
Car sales in Asia rose 9% in the quarter, as strong demand in India, Indonesia and Thailand offset a 24% drop in Japan.
Honda's quarterly operating profit rose 5% to 185 billion yen ($1.9 billion). The company says results were bolstered by cost cutting and favorable exchange rates.
Honda predicts its full-year net income will surge 58% to 580 billion yen ($5.9 billion) as revenue climbs 22% to 12 trillion yen ($123 billion).
The company reiterates that it expects full-year sales of its cars and motorcycles to grow 10% to 4.43 million units and 12% to 17.4 million units, respectively.
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