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CorporateJapanOctober 27, 2004
Consolidated Financial Summary for the Fiscal First Half Ended September 30, 2004
Worldwide unit sales of motorcycles, automobiles and power products increased; all-time record 1st Half results for net sales and other operating revenue, income before income taxes and net income.

Results for Fiscal 1st Half ended Sept. 30, 2004 (*record result for Fiscal 1st Half)

(unit: billions of JPY)
  1st Half ended
Sept. 30, 2004
1st Half ended
Sept. 30, 2004
Difference
(% change)
Net sales and other  operating revenue 4,166.7* 4,025.4 +141.3 (+3.5)
Operating income 332.9 317.8 + 15.0 (+4.7)
Income before income taxes 339.6* 331.8 + 7.7 (+2.3)
Net income 241.3* 239.1 + 2.2 (+0.9)


Basic net income per common share JPY 257.35* JPY 249.34 + 8.01 (+3.2)
(Honda’s average rates: JPY 110 = US 1 dollar, JPY 133 = 1 Euro)
Note: Certain reclassifications have been made to the operating income of the prior year’s fiscal first half to conform to the presentation used for the fiscal first half ended September 30, 2004 .


Honda realized an all-time record for consolidated net sales and other operating revenue for the fiscal first half. Worldwide unit sales of motorcycles, automobiles and power products all increased and set new records for the fiscal first half. Consolidated operating income increased mainly due to increased revenues and cost reduction effects which offset the negative effect from depreciation of the U.S. dollar. Honda’s consolidated income before income taxes and consolidated net income also both marked record highs for the fiscal first half.

  Motorcycles: 5.283 million units (+25.2%); mainly attributable to an increase in sales of parts for overseas production bound for Asia and an increase in sales in North America.

Automobiles: 1.566 million units (+8.5%); the increase was mainly due to an increase in sales of parts for overseas production bound for China in Asia and increased sales in Europe and Japan.

Power Products: 2.472 million units (+12.6%); the increase was due primarily to sales growth in North America.

- Consolidated net sales and other operating revenue rose to JPY 4,166.7 billion (+3.5%) due to unit sales increases in all business areas notwithstanding a negative impact from currency translation effects. (If the exchange rate from the same period during the previous fiscal year was applied, Honda estimates that an increase in revenue of approximately 8.0% would have been realized.)

- Consolidated operating income increased to JPY 332.9 billion (+4.7%) mainly due to increased revenues and cost reduction effects, notwithstanding the negative effects from currency translation effects of JPY -72.8 billion.

- Consolidated net income increased to JPY 241.3 billion (+0.9%) due to a rise in consolidated income before income taxes and increased equity in income of affiliates in Asian markets totaling JPY 47.1 billion (+30.9%). This gain was realized despite the fact that Honda incurred an additional tax due to a reassessment of transfer pricing related to its motorcycle operation in Brazil.

- The interim dividend per share of common stock increased 9 yen to 28 yen. The fiscal year-end dividend is forecast to rise 5 yen to 28 yen resulting in a fiscal year rise of 14 yen per share of common stock totaling 56 yen.

- Consolidated net sales and other operating revenue for the second quarter of the fiscal year was JPY 2,093.5 billion (+3.8%). Consolidated operating income for the period was JPY 172.9 billion (+9.2%), consolidated income before income taxes was JPY 165.5 billion (-10.0%) and consolidated net income totaled JPY 127.1 billion (-7.5%). Consolidated net sales and other operating revenue as well as consolidated operating income for the fiscal second quarter both set all-time records.



Forecasts for Fiscal Year Ending March 31, 2005


A 5th consecutive all-time record is forecast for consolidated net sales and other operating revenue based on all-time record unit sales plans for motorcycles 10.025 million units, automobiles 3.24 million units and power products 5.68 million units. Below is Honda’s forecast for consolidated operating income, consolidated income before income taxes and consolidated net income for the fiscal year ending March 31, 2005:


(unit: billions of JPY)
  Current forecast for year ending March 31, 2005 Year ended
March 31, 2004
Difference
(% change)
July 28, 2004
forecast
Net sales and other operating revenue 8,690.0 8,162.6 +527.4 (+6.5) 8,560.0
Operating income 620.0 600.1 + 19.8 (+3.3) 580.0
Income before income taxes 600.0 641.9 - 41.9 (-6.5) 550.0
Net income 447.0 464.3 - 17.3 (-3.7) 417.0
(Honda’s average rates for the FY2005: JPY 108 = US 1 dollar, JPY 131 = 1 Euro)
(Honda’s average rates for the 2nd half of FY2005: JPY 107 = US 1 dollar, JPY 130 = 1 Euro)


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