Honda Motor Co., Ltd. Reports Consolidated Financial Results for the Fiscal First Quarter Ended June 30, 2004
TOKYO, July 28 -- Honda Motor Co., Ltd. today announced its consolidated financial results for the fiscal first quarter ended June 30, 2004.
First Quarter Results
Honda's consolidated net income for the fiscal first quarter ended June 30, 2004 totaled JPY 114.2 billion (USD 1,054 million), an increase of 12.2% from the corresponding period in 2003. Basic net income per Common Share for the quarter amounted to JPY 121.65 (USD 1.12), compared to JPY 106.02 for the same period in 2003. Two of Honda's American Depositary Shares represent one Common Share.
Unit sales in all of Honda's business categories relating to products, namely motorcycles, automobiles and power products, increased during the fiscal first quarter and consolidated net sales and other operating revenue (herein referred to as "revenue") for the quarter amounted to JPY 2,073.1 billion (USD 19,120 million), increased by 3.2% over the corresponding period in 2003. Revenue was negatively affected by currency translation, which was caused by the translation of foreign currency denominated revenue from Honda's overseas subsidiaries into yen. Honda estimates that if the exchange rate of yen had remained unchanged from that in the corresponding period in 2003, revenue for the quarter would have increased by approximately 7.7%.
Consolidated operating income for the fiscal first quarter totaled JPY 159.9 billion (USD 1,476 million), an increase of 0.3% compared to the corresponding period in 2003. This increase in operating income was due primarily to an increase in revenue contributed by higher unit sales of automobiles, motorcycles and power products and ongoing cost reduction effects, which offset the negative effects of the depreciation of the U.S. dollar.
Consolidated income before income taxes for the quarter totaled JPY 174.0 billion (USD 1,605 million), an increase of 17.6% from the corresponding period in 2003.
With respect to Honda's sales in the fiscal first quarter by business category, motorcycle unit sales increased by 29.0% to 2,582 thousand units. Of them, unit sales in Japan increased 3.2% to 97 thousand units, and overseas unit sales increased 30.3% to 2,485 thousand units. Revenue increased 13.5%, to JPY 274.0 billion (USD 2,528 million). This increase in revenue was due mainly to increased unit sales which offset the negative impact of the appreciation of the yen against the U.S. dollar. Operating income increased 197.6% to JPY 17.1 billion (USD 159 million).
Honda's unit sales of automobiles for the quarter increased by 9.0% to 772 thousand units. In Japan, unit sales of automobiles increased 0.7% to 154 thousand units, and overseas unit sales increased 11.4% to 618 thousand units. Revenue increased 2.1%, to JPY 1,655.1 billion (USD 15,265 million), due primarily to increased unit sales, offsetting negative currency translation effects. Operating income decreased 5.3% to JPY 115.6 billion (USD 1,067 million) due mainly to negative currency effects caused by the depreciation of the U.S. dollar, which offset positive impacts of higher profit from increased revenue and ongoing cost reduction effects.
Revenue from financial services for the quarter decreased 7.1% to JPY 59.4 billion (USD 548 million). Operating income decreased 26.8% to JPY 22.2 billion (USD 205 million).
Unit sales of power products for the quarter totaled 1,387 thousand units, an increase of 14.0% compared to the corresponding period in 2003. Of them, unit sales in Japan totaled 118 thousand units, increased by 7.3%, and overseas unit sales increased 14.6% to 1,269 thousand units. Revenue from power products and other businesses increased by 3.3% to JPY 88.5 billion (USD 817 million), due primarily to increased unit sales of power products, offsetting the negative currency translation effects. Operating income increased 332.9% to JPY 4.8 billion (USD 45 million)
With respect to Honda's sales for the year by geographic segment, in Japan, revenue was JPY 957.9 billion (USD 8,835 million), 1.5% up by the same period of previous year, due primarily to increased sales in all business segments. Operating income in Japan was JPY 32.9 billion (USD 304 million), 11.6% down from the same period of previous year, mainly due to negative currency effects caused by the appreciation of the yen, which offset both improved profit through increased revenue and effects of cost reductions.
In North America, revenue decreased by 6.4% from the corresponding period of the previous year to JPY 1,134.6 billion (USD 10,464 million), due to the negative currency translation effects, although unit sales in motorcycles and power products increased. Operating income also decreased by 25.8% to JPY 80.6 billion (USD 744 million) from the previous year.
In Europe, revenue for the quarter increased by 9.2% to JPY 274.4 billion (USD 2,531 million) compared to the same period of the previous year, due mainly to increased unit sales in motorcycles, automobiles and power products. Operating income in Europe increased by 153.4% to JPY 14.9 billion (USD 138 million).
In Asia, revenue increased by 27.4% to JPY 203.1 billion (USD 1,873 million) from the same period of the previous year, due mainly to continued strong sales in motorcycle and automobile businesses. Operating income also increased by 98.2% to JPY 19.8 billion (USD 183 million) from the previous year.
Revenue from Other Regions for the quarter increased by 47.6% to JPY 102.5 billion (USD 946 million) compared to the previous year, due to increased unit sales in motorcycles and automobiles. Operating income increased by 53.3% to JPY 8.7 billion (USD 80 million) from the previous year.
Forecasts for the fiscal year ending March 31, 2005
Consolidated financial forecasts
First half ending September 30, 2004
In billions Changes from
of yen FY2004
Net sales and other operating revenue 4,240 +5.3%
Operating income 305 -4.1%
Income before income taxes 305 -8.1%
Net income 222 -7.2%
Fiscal year ending March 31, 2005
In billions Changes from
of yen FY2004
Net sales and other operating revenue 8,560 +4.9%
Operating income 580 -3.4%
Income before income taxes 550 -14.3%
Net income 417 -10.2%
Unconsolidated financial forecasts
First half ending September 30, 2004
In billions Changes from
of yen FY2004
Net sales 1,670 +5.6%
Operating income 53 -41.3%
Ordinary income 80 -47.4%
Net income 50 -54.7%
Fiscal year ending March 31, 2005
In billions Changes from
of yen FY2004
Net sales 3,410 +2.7%
Operating income 103 -44.3%
Ordinary income 175 -43.8%
Net income 125 -44.8%
These forecasts are based on the assumption that the average exchange rates for the yen to the U.S. dollar and the euro for the second half ending March 31, 2005 will be JPY 105 and JPY 125, respectively, and the current fiscal year ending March 31, 2005, JPY 107 and JPY 128.