With new Accord, Ford Fusion and Nissan Altima models, among others, taking on the best selling Toyota Camry this fall, it will be a great time to buy a new family car. Stockholders might have a different view of what is now an overcrowded segment.
Honda Motor Company today in Tokyo posted strong earnings of $1.7 billion (¥131.7 billion) for the Japanese fiscal first quarter that ended 30 June. This was an increase of 314.3% from the same period last year when an earthquake and tsunami interrupted production. Auto sales at 999,000 units, and motorcycle sales of almost 4 million were strong contributors to the comeback.
Basic net income per common share for the quarter amounted to $0.92 (¥73.09), an increase of $0.70 compared to last year. One Honda American Depository Share represents one common share in Honda Motor Company.
Despite the strong recovery, the results did not meet analysts’ expectations because of rising marketing costs and the strong yen. Nevertheless, Honda is sticking to its global sales forecast of 4.3 million vehicles in the Japanese fiscal year to March 2013, an increase of 38.4% from FY 2012. North America is forecast to sell almost 40% of the total, which means a lot is riding on the success of the new Accord due this fall.
The quarterly dividend for the fiscal first quarter will be ¥19 per share, increase of ¥4 compared to the quarterly dividend for the same period last year. The total cash dividends to be paid for the fiscal year ending March 31, 2013 are planned to be ¥76 per share, an increase of ¥16 per share from the previous fiscal year.
Japan’s third largest automaker is targeting full-year sales of ¥10.3 trillion. Honda is setting its forecasts based on exchange rates of ¥80 to the dollar and ¥105 to the euro.
Nissan, Japan’s Number Two automaker, which was the quickest to recover from last year’s natural disasters because of unaffected offshore components and assembly operations, posted a 20% decline in quarterly profits last week, down to ¥120.7 billion ($1.5 billion). This also missed analysts’ expectations. Nissan says sales of the new Altima just entering production will turn things around in the back half of the year.
