Financial Review
Honda's consolidated net income for the fiscal first quarter, ended June 30, 1996,
amounted to ¥45.7 billion ($417 million), an increase of 283.4% from the
corresponding quarter last year. Net income per Common Share for the three months
under review totaled ¥46.91 ($0.43), compared with ¥12.23 for the corresponding
period one year ago. Net income per American Share, each representing two Common
Shares, totaled ¥93.82 ($0.86), compared with ¥24.46 for the corresponding
quarter last year.
Consolidated net sales and other operating revenue for the first quarter totaled
¥1,230.7 billion ($11,240 million), an increase of 30.3% from the corresponding
three months one year ago. Revenue increased primarily due to overall favorable
sales of automobiles, particularly in Japan.
Consolidated operating income rose 162.0%, to ¥68.6 billion ($627 million).
In addition to higher revenue, Honda's continued cost-cutting efforts and the
depreciation of the yen positively affected operating income.
Consolidated income before income taxes and net income for the first fiscal quarter
were ¥76.0 billion ($695 million) and ¥45.7 billion ($417 million),
increasing 303.1% and 283.4%, respectively, from the corresponding quarter last
year. The Company's consolidated income statement data for the quarter included
a pre-tax gain of ¥10.4 billion and an after-tax gain of ¥5.0 billion
on the nonmonetary exchange of common shares of The Bank of Tokyo, Ltd. ("BOT"),
held by Honda for common shares of The Bank of Tokyo-Mitsubishi, Ltd., following
the merger of BOT and The Mitsubishi Bank, Limited, on April 1,1996. The unrealized
gain on the Company's investment in BOT shares was previously included in a separate
component of stockholders' equity as of March 31, 1996.
Reviewing the first quarter by business segment, Honda's motorcycle unit sales
advanced 3.2%, totaling 1,317,000 units, and revenue increased 18.7%, to ¥172.3
billion ($1,574 million). Stronger sales centered in Europe and Asian markets
outside Japan--particularly in China and Thailand--together with improved product
mix, positively affected revenue.
Unit sales of automobiles totaled 515,000 units, and revenue amounted to ¥976.9
billion ($8,922 million), increasing 15.5% and 35.2%, respectively, from a year
ago. These increases resulted primarily from a strong gain in Honda's automobile
sales in Japan due, in particular, to the increased sales of the CR-V and Orthia
models as well as the introduction of a new minivan, the Step WGN (Wagon), in
May 1996.
Power product unit sales increased 5.2%, totaling 489,000 units. Honda's other
businesses, including its power product business, generated revenue of ¥81.4
billion ($744 million), an increase of 6.6% from the corresponding quarter last
year. Favorable sales of power products in overseas markets, mainly in Asia, together
with an increase in Honda's finance business, contributed to this rise in revenue.
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