Honda Raises Outlook as Sales, Earnings Jump

Honda Motor Co. reports that the new cuts in U.S. corporate taxes helped to more than triple its net income in October-December to 570 billion yen ($5.2 billion).

Honda Motor Co. reports that the new cuts in U.S. corporate taxes helped to more than triple its net income in October-December to 570 billion yen ($5.2 billion).

The tax reduction handed the company a gain of 346 billion yen ($3.1 billion) for its fiscal third quarter. Operating profit for the period jumped 37% to 285 billion yen ($2.6 billion).

Honda says favorable exchange rates and a richer sales mix hiked its quarterly revenue 13% to 4 trillion yen ($35.9 billion). Unit sales rose 2% to 1.34 million cars and trucks worldwide.

Operating profits in Japan in October-December fell 21% in spite of a 1% gain in unit sales. But the company posted big gains in in Asia (+35% to 111 billion yen/$1 billion) and North America (+27% to 106 billion yen/$961 million).

The third-period results prompted the company to raise its outlook for the fiscal year ending March 31. Honda, which previously forecast annual net income of 585 billion yen, now expects 1 trillion yen ($9.1 billion). The company says its operating income will shrink 8% to 775 billion yen ($7 billion), compared with the 11% drop it predicted previously.

Honda now anticipates its global car sales for the current fiscal year will reach 5.23 million vehicles, up from its forecast in November of 5.13 million. The company sold 5.03 million units in the previous 12-month period.