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August 5, 2020

Honda Motor books fiscal Q1 loss

Honda Motor has booked an operating loss for the first fiscal quarter ended 30 June, 2020.

By Olly Wehring

Honda Motor has booked an operating loss for the first fiscal quarter ended 30 June, 2020.

Sales revenue fell 46.9% year on year to JPY2,123.7bn and the operating loss was JPY113.6bn, a decrease of JPY366.1bn, due mainly to a decrease in profit attributable to decreased sales revenue and model mix, which was partially offset by decreased selling, general and administrative expenses.

The loss before income taxes was JPY73.4bn, a fall of JPY363.2bn.

Net loss was JPY80.8bn, a decrease of JPY253.1bn.

“The spread of coronavirus disease 2019 (COVID-19) has caused the global economic slowdown and also has affected Honda’s consolidated financial results for the [quarter],” the automaker said in a statement.

“Resulting from travel restriction measures by government, Honda’s production bases in Japan and overseas were also affected by suspended or reduced production mainly due to restrictions on employees’ commute to the workplaces and delays in the supply of parts within the supply chain. Some dealers in Japan and overseas were obliged to suspend business, shorten business hours, or reduce services such as inspections and repairs.”

The loss per share fell to JPY46.84, a decrease of JPY144.76.

Honda said it had been unable earlier to provide “a reasonably calculated forecast of the consolidated financial results for the fiscal year ending 31 March, 2021, due to impacts relating to the spread of COVID-19”.

But now, “based on various factors such as recent environment and trends in financial results”, the automaker projects fiscal 2021 sales revenue of JPY12,800bn (-14.3% vs FY2020), operating profit JPY200bn (-68.4%), profit before income taxes JPY365bn (-53.8%) and net profit JPY165bn (-63.8%).

EPS is pegged at JPY95.56.

Fiscal first quarter dividend is JPY11 per share and subsequent quarterly payouts are expected to be the same.

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