Honda lifts annual profit forecast by 8.3 percent on lower costs, sees sales up

Honda lifts annual profit forecast by 8.3 percent on lower costs, sees sales up

Honda Motor Co raised its full-year operating profit forecast by 8.3 percent due to lower quality-related costs and cost cuts which it expects will offset the impact of a stronger currency.

Japan's third-largest automaker by sales said on Monday it expects annual operating profit to rise to 650 billion yen ($6.21 billion), up from a previous forecast of 600 billion yen. That is lower than the average 689 billion yen profit expected by 25 analysts polled by Thomson Reuters.

Honda sees full-year net profit rising to 415 billion yen, higher than a previous forecast for 390 billion yen.

The company forecast global car sales of 4.98 million cars for the year ending in March 2017, compared to the previous forecast of 4.915 million. Asia car sales are forecast to rise to 1.915 million for the year, from the 1.85 million previously seen.

Honda said it is assuming an average rate of 103 yen to a dollar for the current year, against its earlier forecast of 105 yen.

It posted an operating profit of 228 billion yen in the September quarter, up 38.4 percent from a year ago and exceeding an average estimate of 160.1 billion yen from 11 analysts surveyed by Thomson Reuters.