Honda Motor Co. Ltd. posted a 2.6% earnings increase during the second quarter.
Honda Motor Co. Ltd. saw its Q2 earnings jump 2.6% to 220.1 billion yen, or about $2 billion, from 214.4 billion yen from the same period a year ago. The company, much like Toyota on Thursday, announced it plans to buyback $915 million in shares.
The automaker plans to buy up to 33 million shares of stock between Nov. 11 and March 31, 2020, the end of its fiscal year.
Unlike Toyota, but mirroring nearly every other Japanese automaker, Honda revised its full-year earnings downward to a four-year low. The company pointed to a rising yen and poor sales in North America and India.
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Officials at the automaker now predict an operating income of 690 billion yen for the year to March, lowest since the year-ended March 2016, from 770 billion yen previously, according to Reuters, while the yen will push to 107 from 110, cutting away at profits.
Honda expects sales in the U.S. to fall throughout its fiscal year, which ends March 31, 2020.
The revision on operating income comes largely as a result of “unfavorable currency effects. Honda will continue to make steady progress in the improvement of profitability and strives to establish a business structure which generates profit equivalent to or more than that of the previous fiscal year,” the company said.
During the quarter the company’s operating revenue slid to 3,729.1 billion yen, a fall of 2.9% compared with the same period last year. The fall, according to Honda, is due primarily to a decrease in sales revenue such as automobile and motorcycle businesses, as well as unfavorable foreign currency translation effects. This was despite an increase in sales revenue from financial services business.
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The automaker sold 1.241 million vehicles during the quarter which is down just slightly compared with year-ago results, which saw the company sell 1.246 million vehicles globally. Honda is now Japan’s third-largest automaker behind Toyota and Nissan.
Honda announced plans to close its manufacturing plant in Swindon. It means the loss of 3,500 jobs.
The weakness in the North American and Indian markets are expected to continue throughout this year, but it really appears that the dip in India, the world’s fourth-largest car market, has hampered the automaker.
“The Indian market is contracting at a very rapid rate,” said Honda Executive Vice President Seiji Kuraishi. “I must say, we are struggling there.”
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The company cut its outlook for global group auto sales to 4,975,000 vehicles, from its previous forecast of 5,110,000, for the current financial year.