Honda’s Net Income Climbs 21%

Honda Motor Co.’s operating and net income in its most recent fiscal year grew 40% to 214 billion yen ($1.9 billion).

Revenue expanded 2% to 3.8 trillion yen ($33.8 billion) in July-September, even though unit sales dipped 4% to 1.25 million vehicles. The company’s operating profit climbed 40% to 211 billion yen.

The earnings were buoyed in large part by comparison with the year-ago quarter, when Honda was hit by lawsuit settlements involving explosion-prone Takata Corp. airbag inflators. But a richer sales mix in the U.S. reversed last year’s $6 million operating loss with a $470 million profit.

Honda says it has adjusted its product mix to match the American market’s high demand for SUV/crossover models. The result more than offset a 5% decline in unit sales caused by a major flood in June at Honda’s assembly plant in Celaya, Mexico. The 4-year-old facility , which makes the Fit five-door subcompact car and HR-V subcompact crossover, resumed partial production earlier this month. The plant isn’t expected to return to normal output for another two weeks.

Honda reiterates that it expects its unit sales in the fiscal year ending next March 31 will grow 2% to 5.29 million vehicles. But the company says cost-cutting measures and a more profitable mix will narrow previously predicted downturns in net income and operating profit to 36% and 675 billion yen ($5.4 billion) and 5% to 790 billion yen ($7 billion), respectively.