Earnings: Honda Motor begins fiscal 2020 on a dull note, sells fewer cars in North America

Japanese automobile manufacturer Honda Motor Co (NYSE: HMC) said its revenues for the first three months of fiscal 2020 edged down 0.7% to JPY 3,996.2 billion (approx. $37.4 billion).

During the quarter, the company witnessed disappointing performance across all business units, except in Financial services. The top-line was also hurt by forex headwinds, the company said.

The Motorcycle and Life Creation units (Power Product business has been renamed Life Creation business from April 1, 2019) declined 8.1% and 4.5% respectively, partially offset by a marginal 1.2% increase in the Automobile segment.  

Automobile sales were mainly pulled down by the weakness in North America, where it sold 23% fewer cars compared to last year. The big fall in the Motorcycle division was led by weakness in the Indian market.

Despite its cost optimization initiatives, operating profit fell 15.7% to JPY 252.4 billion (approx. $2.36 billion) due to SG&A expenses and lower revenues.

On a per-share basis, the Civic-maker reported earnings of JPY 97.92 (approx. $0.92) in the first quarter.

READ: What Tesla executives discussed during Q2 2019 earnings call

HMC shares ended their last trading session down 0.24%. The stock has declined 6% so far this year.

Outlook

For the fiscal full year, the company expects a 1.5% decrease in sales revenue to JPY 15,650 ($146.4 billion), while EPS is projected to be JPY366.57 (3.43).

Operating profit for this period is forecast to increase 6%.

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