Honda Motor booked an operating loss for the fiscal fourth quarter ended 31 March 2020 of JPY5.6bn, a year on year plunge of JPY47.9bn, due primarily to a fall in sales revenue and unfavourable model mix.
“This was despite the fact that operating profit from the motorcycle business during the quarter experienced a year on year increase due primarily to continuing cost reduction and a decrease in selling, general and administrative (SG&A) expenses,” the automaker said.
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Excluding currency effects, one-off costs and the impact of the spread of COVID-19 pandemic, Honda estimated a year on year operating profit increase of JPY32.4bn.
One-offs included the impact of changes being made to automobile production operations.
“The impact of the spread of COVID-19 pandemic includes a decrease in unit sales, an increase in provision for sales incentives and an increase in provision for credit losses for financial services business,” Honda said.
“The spread of COVID-19 pandemic has stagnated both consumer spending and the economic activities of businesses on a global basis, and future prospects remain uncertain at this moment.
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By GlobalData“Amid such circumstances, production, sales and other Honda business activities are being impacted in all regions.”
Q4 sales revenue fell 14.6% to JPY3,458.0bn due primarily to a decrease in revenue from the automobile business.
This was despite an increase in sales revenue from financial services business and other factors.
Full fiscal year revenue fell 6% to JPY14,931.0bn due again mainly primarily to a decrease in automobile business revenue and negative foreign currency effects.
Operating profit for the fiscal year fell 12.8% to JPY633.6bn due to a decrease in profit related to changes in sales revenue and model mix plus negative currency.
Pre-tax profit fell 19.3% to JPY789.9bn.
Operating profit excluding currency effects, one-offs and the COVID-19 pandemic effect was estimated at a year on year increase of JPY100.8bn.
Quarterly dividend will be JPY28 a share and total dividend for the fiscal year will be JPY112, up JPY1 year on year.
Honda did not provide a forecast for the 2020/21 fiscal year, citing the effects of the COVID-19 pandemic.
