Honda, Mazda Improve Bottom Lines

TOKYO—Japanese automakers Honda Motor Co. and Mazda Motor Corp. both said that sales was growing strongly in Asia and North America as both reported improved earnings for the quarter.

Honda fared better of the two, reporting a surge in net profit of 272.49 billion yen ($3.13 billion) in the fiscal first quarter ended June 30, a huge jump from 7.56 billion yen in the same period a year earlier. The company also boosted its full-year outlook as solid sales in Asia and North America and cost-reductions more than offset the impact of the yen's strength.

Operating profit grew more than nine-fold to yen 234.44 billion in the April-June quarter, from 25.16 billion yen a year earlier.

The net profit beat the average forecast for a 106.78 billion yen based on a survey of four analysts compiled by the Tokyo-based financial information service provider Quick.

Honda, Japan's third-largest car maker by sales volume, said sales rose 17.9% to 2.361 trillion yen in the three months ended June from 2.002 trillion yen.

For the current fiscal year through March, Honda said it now expects group net profit of 455 billion yen against earlier forecast of 340 billion yen and operating profit of 450 billion yen against 400 billion yen.

Its full-year sales outlook was trimmed to 9.100 trillion yen from earlier-projected 9.340 trillion yen even as it raised its global vehicle sales target to 3.640 million units from 3.615 million units projected in April on an anticipated boost in sales for Asia.

Honda also said it will buy back up to 12 million shares for 25 billion yen and cancel 1.3% of outstanding shares Aug. 6.

Meanwhile, Mazda said Friday sales in North America and China, along with cost cuts, helped it narrow net losses in its fiscal first quarter, leaving it on track to return to profit this fiscal year after restructuring.

The company said said its retail sales rose 21% by volume in North America and 28% in China, which caused revenue to increase 35% to 578.0 billion yen from 428.2 billion yen last time.

Mazda, in which Ford Motor Co. owns an 11% stake, said its net loss narrowed to 2.10 billion yen in the last quarter, compared with a net loss of 21.5 billion yen in the same period a year earlier.

Though it finished the period in the red, Japan's fifth-biggest car maker by volume did log an operating profit of 6.37 billion yen in the April-June quarter, compared with an operating loss of 28 billion yen a year earlier.

Mazda, best known as the maker of the Mazda3 subcompact and the MX-5 Miata convertible, left unchanged its forecast for the current fiscal year through March.

The car maker continues to expect a net profit of 5 billion yen, an operating profit of yen 30 billion and sales of 2.270 trillion yen.

Honda reports earnings under U.S. accounting standards. Mazda reports earnings under Japanese accounting standards.

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