Honda Motor (HMC 30.58, +0.15, +0.48%) is higher by 0.5% after
reporting better than expected quarterly results.
The automaker reported above-consensus first quarter earnings of JPY22.49 per share on an 8.4% year/year increase in revenue to JPY4.02 trillion, which was also ahead of estimates.
Consolidated operating profit grew 11.2% year/year to JPY299.30 bln due to strong sales of automobiles in North America, strong motorcycle sales in India and Vietnam, and lower expenses. Profit growth was recorded despite the impact of plant flooding in Mexico.
The company reported volume growth in all three segments. Honda Group Motorcycle sales grew 13.9% to 5.35 mln, Automobile sales grew 3.0% to 1.31 mln, and sales of Power Products grew 0.8% to 1.34 mln.
Honda's Automobile unit sales in Japan grew 5.8% to 167,000. The company launched a new N-VAN and a new Clarity PHEV in July.
Automobile unit sales in the U.S. ticked down 0.3% to 425,000. The quarter featured June launches of a new Acura RDX SUV and a Honda Insight sedan. The downtick in U.S. sales was offset by growth elsewhere in North America. In total, unit sales in North America increased 7.7% to 518,000.
Automobile unit sales in China fell 6.4% to 321,000. The company launched a new Honda Accord in May.
Motorcycle sales in India grew 14.3% year/year to 1.69 mln thanks to strong sales of Activa and X-Blade models. The company also launched a new Dio scooter and a CD 110 Dream DX motorcycle in June.
Honda modified its unit sales forecast for fiscal 2019. The company now expects that motorcycle sales will increase 1.5% more than previously thought, to 20.85 mln. Automobile sales are expected to total 5.29 mln, down 1.7% from the previous forecast. Sales of Power Products are expected to total 6.35 mln, up 0.9% when compared to the previous forecast. Honda expects that revenue for fiscal 2019 will total JPY15.45 trillion, which represents a JPY150 bln decline when compared to the previous outlook. Earnings per share are expected to hit JPY348.56, which is JPY26.14 higher than previously thought.
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