Honda three-month profit jumps nearly 20% to $1.5 bn

The Civic maker`s bottom-line profit came to 186 billion yen ($1.5 billion) for the three months, up from 155.6 billion yen a year earlier, while sales jumped 15.5 percent to 3.7 trillion yen.

Tokyo: Honda said on Friday that its net profit in the April-June quarter jumped nearly 20 percent thanks to cost cutting and a weak yen, offsetting the impact of an exploding air-bag crisis.

The Civic maker`s bottom-line profit came to 186 billion yen ($1.5 billion) for the three months, up from 155.6 billion yen a year earlier, while sales jumped 15.5 percent to 3.7 trillion yen.

Operating profit rose 16.4 percent due to "cost-cutting effects and a foreign exchange impact ... despite an increase in selling, general and administrative expenses that include quality-related expenses," the firm said.

A sharp drop in the yen has been a plus for Japanese exporters as it makes them more competitive overseas and inflates their repatriated profits.

Japan`s number three automaker left its fiscal-year forecast unchanged: a net profit of 525 billion yen on sales of 14.5 trillion yen.

In June, Honda revised down its annual earnings for the last fiscal year, blaming the expanding recalls of faulty airbags made by embattled supplier Takata, which have been linked to eight deaths and scores of injuries.

Earlier this month, Honda, the hardest hit global automaker, said it was recalling another 4.5 million vehicles as the scare over a deadly defect in Takata-made airbags widened.

The move took to 24.5 million the total number of vehicles that it had called back over the airbag affair.

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