Honda achieves record Q1 Earnings: Operating profit hits 1.38 trillion yen
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Today, on 10 May 2024, Honda Motor Co., Ltd. reported its earnings for the first quarter of FY24.
Honda’s operating profit for this quarter reached an all-time high of 1 trillion 381.9 billion yen and the operating profit margin was 6.8%.
Honda Group’s net sales and profits
Honda’s motorcycle business sales increased in Europe compared with the previous year, with 18 million 819-thousand-unit sales total. Its operating profit saw a historical high of 556.2 billion yen.
The company’s automobile business sales increased in North America, with 4 million 109-thousand-unit sales total. The operating profit was 560.6 billion yen.
However, Honda’s power products business sales decreased in North America, with 3 million 812-thousand-unit sales total. In the company’s power products business and other businesses, operating profit was a minus of 8.8 billion yen.
In the financial services business, operating profit was 273.9 billion yen.
Honda’s consolidated operating profit increased by 601.2 billion yen to 1 trillion 381.9 billion yen this quarter because of improved model profitability and increased automobile unit sales.
The company’s ROIC was 9.1% and ROE was 9.3%.
Profit before income tax improved by 762.8 billion yen compared with FY23 resulting in 1 trillion 642.3-billion-yen total profits.
Honda’s free cash flow of non-financial services businesses was 1 trillion 460.9 billion yen. Net cash at the end of the period was 3 trillion 761.6 billion yen in total.
Future projections
By FY25, the company aims to achieve an operating profit of 1 trillion 420 billion yen and an operating profit margin of 7%.
Future investment sources for Honda increased by 1 trillion yen compared to FY23 to approximately 3 trillion yen. The dividend of 68 yen this quarter was 28 yen more than FY23. The company predicts, in FY25, it will conduct a share buyback of 300 billion yen.
Initiatives for the next financial year include a share buyback of 300 billion yen. The company is also on track to attain an operating profit margin of 7%.
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