Honda Motor, Japan's second-biggest car maker, posted today a 12 per cent fall in quarterly operating profit, hit by a sales slump at home and a weak dollar, but raised its full-year forecasts on expectations for smaller currency losses.
Honda, the first big Japanese car maker to report results for the first quarter to end-June, racked up record earnings last year along with rivals, but its industry-beating run in the profitable US market was countered by a domestic sales slump.
Its profit margins lag those at rivals Toyota Motor and Nissan Motor, but its earnings are healthy compared with US counterparts, which are caught in a fierce price war on their home turf.
Honda, like other Japanese auto makers, has been dragged down by a stronger yen against the dollar, although an even sharper fall in the yen against the euro has helped European sales.
Operating profit for the three months to June at Honda, which also is the world's biggest motorcycle maker, was 150.18 billion yen ($1.3 billion) compared with 170.82 billion yen posted a year earlier and an average 157 billion yen forecast by six analysts.
Net earnings shrank 5.4 per cent to 101.82 billion yen, or 106.02 yen per share, as revenues grew 3.7 per cent to 2.01 trillion yen.
Honda still made a solid showing in the US market, which accounts for 80 to 90 per cent of its total operating profit.