11:20 | 11/08/2017 Car & Motor
Japanese vehicle maker Honda last Tuesday said net profit for the second quarter rose by double digits boosted by strong motorcycle sales, revising up its full-year forecast.
|The new version of Honda Lead at the Vietnam Motorshow 2017 - Photo: thanhnien|
The Tokyo-based company said "solid sales of two-wheel vehicles in Asia and cost reduction efforts" contributed to increased profits.
Motorcycle sales volume grew in India and Vietnam, Honda said, while four-wheel vehicle sales volume increased in Japan and China but declined in North America.
Japan's number-three automaker booked net profit of 207.3 billion yen ($1.88 billion) in the April-June period, up 18.7 percent from the previous year.
Sales grew 7.0 percent to 3.71 trillion yen, while operating profit rose 0.9 percent to 269.2 billion yen.
Honda boosted its net profit forecast to 545 billion yen from an earlier figure of 530 billion yen for the fiscal year ending March 2018.
It also lifted its fiscal year operating profit and revenue outlooks.
"Honda's profit pales compared to figures last year when it booked a one-time gain in a pension accounting change," Satoru Takada, an analyst at TIW, a Tokyo-based research and consulting institute, said ahead of the earnings release.
"But it displayed a good performance in China and Indonesia while showing steady sales in North America," he said.
While North American vehicle sales declined in the quarter year on year to 481,000 from 510,000, revenue rose slightly to 2.13 trillion yen from 2.06 trillion yen.
Takada added that the foreign exchange situation is "a key factor" for automakers.
"Current levels are relatively positive for the Japanese auto industry," he said.
Although the yen has strengthened slightly in past days, it remains weak against the dollar over recent years.
A stronger Japanese yen can hurt carmakers by eroding the value of overseas profits when repatriated.