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TOKYO: Honda Motor Co. said Friday its net profit rose 8.1 percent
to hit a record high for the fiscal first quarter on brisk demand in
emerging markets such as China and Brazil.
Japan’s second-largest automaker, however,
kept its forecast for a slide in annual earnings due to a weaker
global economy, a stronger yen and the soaring cost of raw materials
including steel.
The company posted net profit of 179.61 billion
yen ($1.68 billion) for the three months to June despite a
2.2-percent drop in revenue to 2.87 trillion yen. Operating profit
edged down 0.2 percent from a year earlier to 221.35 billion yen.
Honda said the profit rise was mainly due to
fewer sales discounts in the US, higher vehicle sales and
cost-cutting efforts.
Japanese automakers have enjoyed brisk profits
in recent years, helped by firm demand for fuel-efficient cars and a
weak yen. But a US economic slowdown, a falling dollar and soaring
raw materials costs are now weighing on their earnings prospects,
although robust demand in fast-growing emerging economies is
cushioning the impact.
Reflecting the tough conditions, Honda cut its
forecast for operating profit for the full fiscal year to March at
630 billion yen from 650 billion yen previously, which would mark a
33.9-percent plunge from the previous year.
Net earnings are expected to fall 18.3 percent
to 490 billion yen as revenue edges up 1.1 percent to 12.13 trillion
yen.
-- AFP
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