TOKYO (AP) — Honda Motor Co. said Thursday its profit shot up 63 percent in the July-September quarter, mainly riding on solid sales of smaller, fuel-efficient vehicles and cost-cutting efforts.
Net income at Japan's No. 2 car maker climbed to 208.5 billion yen ($1.83 billion) for its fiscal second quarter, up from 127.9 billion yen in the same period a year ago.
Group operating profit rose 48 percent to 286.34 billion yen ($2.51 billion) from 193.02 billion yen. Group sales grew 13 percent to 2.971 trillion yen ($26.06 billion) from 2.631 trillion yen, achieving its seventh consecutive sales record, the company said.
The results show Honda's models such as Civic and Accord, as well as CR-V sport utility vehicle, attracted consumers despite rising gasoline prices, keeping the company's business on track, it said.
Honda's global automobile sales rose 6 percent to 937,000 units in the latest four-month period, compared with a year earlier, with brisk sales in North America, Europe and Asian markets.
By value, auto sales rose 9.6 percent in North America, 25.8 percent in Europe and 32.6 percent in Asia.
North America accounts for more than half of Honda's total sales, but Europe and Asia also expanded from last year. Honda's car sales at home, however, dipped 16.4 percent to 143,000 units.
The company also said cost reduction effects contributed to its profit growth despite heavier depreciation costs on investments in plants and equipment to ramp up production capacity.
Honda is the first Japanese car maker to report earnings for the latest quarter.
Toyota Motor Corp., competing with rival General Motors Corp. to become the world's No. 1 auto seller this year, also is expected to report solid earnings for the quarter on growing sales in Europe, China and other overseas markets. Toyota's quarterly results are expected on Nov. 7.
Nissan Motor Co., though, may report weaker earnings when it releases results Friday, partly due to lower operating efficiency in the U.S., where it sought to cut inventories, analysts say.
For the April-September fiscal half, Honda reported a 38.1 percent increase in net profit to 374.6 billion yen ($3.29 billion) from 271.3 billion yen, also its all-time record.
Its group operating profit during the period rose 28.1 percent to 508.0 billion yen ($4.46 billion) from 396.5 billion yen and sales were up 12.8 percent to 5.902 trillion yen ($51.77 billion).
Honda lifted its group net profit outlook for the fiscal year through March 2008 to 640 billion yen ($5.61 billion) from 625 billion yen but trimmed sales to 12.3 trillion yen from ($107.89 billion) from 12.35 trillion yen.
Honda shares fell 1.85 percent to close at 3,710 yen ($32.54) Thursday on the Tokyo Stock Exchange. The company released results after trading ended.
Honda reports earnings under U.S. accounting standards.