Honda Motor Co. Ltd announced that its net profit for the quarter from October to December 2013 more than doubled from the one posted in 2012, due to the weaker yen and the companys solid sales in Japan, North America and other Asian markets compensate for the solid investments made in new plants in emerging markets.
Honda Motor is currently the third biggest car maker by volume in Japan. Today it made an official announcement and posted a net profit estimated to 160.7 billion yen (1.6 billion dollars) in the quarter ended December 2013. The results more than doubled the net profit of the company from 2012. According to some data compiled by Quick, the figures are still slightly below the analysts projections for 165.25 billion yen.
The global sales of Honda Motor Co. increased by 9,7% and reached 1.08 million vehicles between October and December 2013. Its revenue rose by 24.5% from 2.426 trillion yen to 3.021 trillion yen.
The company also said that it will do anything possible to keep up the great sales in final quarter of the fiscal year, although Honda cuts its forecasts for global sales for the full year to 4.385 million vehicles from the previous 4.430 million. The company said that the reason for cutting its forecasts lies in the uncertainty of emerging markets. The full-year target would still be 9.2% more than the one in 2012, amounted to 4.014 million.
Honda Motor Co. Ltd announced that it projects a net profit estimated to 580 billion yen, and a revenue estimated to 12.1 trillion yen, which is more than 22% up for the fiscal year.
The Executive Vice President Tetsuo Iwamura said for the Wall Street Journal: “It is becoming difficult to see the outlook, especially for Asia. But well seek to grow sales based on the new models we are launching.”
The weaker yen, along with flourishing sales compensate for higher depreciation costs. At the same time, Honda adds production capacity in Asia and Latin America, where auto demand is expected to grow. Honda Motors was the one with slowest growth of the top three car manufacturers in Japan after the massive earthquake in the country and the flooding in Thailand in 2011. However, in the past few months it has been pushing out a line of new models, with the hope of doubling its global sales in the five years through 2017.
One of the analysts working for Goldman Sachs Group Inc. – Kota Yuzawa, said for Bloomberg: “Every Japanese carmaker was hurt in Thailand, and so was Honda. Honda hasnt launched its new hit products in the region so well have to wait until next year to see a pickup in volumes.”
According to Bloomberg, the current share price of Honda Motor Co. Ltd is 0.26% down, and its one-year return rate is 13.39% up.
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