Honda Motor Co. Ltd. on Aug. 2 lowered its profit outlook for fiscal 2020 after reporting weaker-than-expected earnings for the first fiscal quarter.
The Japanese automaker now expects profit attributable to owners of the parent to grow 5.7% to ¥645 billion, or ¥366.57 per share, for the fiscal year ending March 31, 2020. It previously anticipated attributable profit to increase 8.9% to ¥665 billion, or ¥377.94 per share.
It also expects sales revenue to come in at ¥15.650 trillion, slightly lower than its prior guidance of ¥15.700 trillion. Honda continues to expect operating profit to amount to ¥770 billion.
For the three months ended June 30, the company saw attributable profit drop 29.5% to ¥172.30 billion from ¥244.33 billion in the year-ago period.
EPS amounted to ¥97.92, down from ¥137.75 in the first quarter of fiscal 2019 and below the S&P Global Market Intelligence consensus GAAP EPS estimate of ¥117.85, with five analysts reporting.
Sales revenue declined 0.7% year over year to ¥3.996 trillion from ¥4.024 trillion, partially caused by negative currency effects that were slightly offset by sales revenue growth in the company's financial services business.
Unit sales climbed 1.2% in the company's automobile segment, driven by growth in China and Japan. However, unit sales declined by 4.5% in the life creation segment and also slid 8.1% in the motorcycle segment, mainly due to a weak Indian market.
Operating profit also fell 15.7% to ¥252.47 billion primarily due to increased selling, general and administrative expenses. Operating margin was 6.3%, versus 7.4% in the year-ago period.
Meanwhile, the company announced a quarterly dividend of ¥28 per share as it aims for an annual dividend of ¥112 per share for fiscal 2020.
As of Aug. 1, US$1 was equivalent to ¥108.24.