Honda Q2 profit more than doubles to 1.7 billion dollars

Japan’s Honda Motor said Friday its net profit more than doubled to $1.7 billion for the three months to September, while it also upgraded its full-year profit forecast.

Honda, which is vying with Nissan to be the nation’s number two automaker, said its net profit came to 135.9 billion yen ($1.7 billion ) for the fiscal second quarter, up from 54.0 billion yen a year earlier.

The company said the brisk performance was mainly due to Japanese government incentives for energy efficient cars and its own cost-cutting efforts, which offset the negative impact of a strong yen.

The yen has been trading at 15-year-highs, hammering Japanese exporters by making their products less competitive abroad while also reducing their repatriated earnings when they are converted back into yen.

But, despite the currency woes abroad, Honda’s sales rose 9.5 per cent to 2.25 trillion yen and operating profit soared to 163.4 billion yen from 65.5 billion yen for the quarter.

Honda revised upward its net profit forecast for the financial year to March 2011 to 500 billion yen from the 455 billion yen projected earlier.

The firm is now forecasting its full-year operating profit at 500 billion yen, up from 450 billion yen predicted earlier, but downgraded its annual sales forecast to 9.0 trillion yen from its earlier estimate of 9.1 trillion yen.

Honda’s global vehicle sales were up 7.2 per cent on-year, thanks to increased demand in the large emerging markets of India and China, as well as moderate recoveries in Japan and North America.

Motorcycle sales jumped 13.4 per cent from a year earlier, the company said, due to robust sales in Asia and South America, although sales in North America remained in a slump. – AFP

Tags: Honda