Belfast Telegraph

Japan earthquake destroys 90% of Honda's profits

Honda's quarterly profit plunged nearly 90% to 31.7bn yen (£251m) because of sales damage from the earthquake in north-eastern Japan.

The car giant's April-June profit was just a fraction of the 272.4bn yen (£2.2bn) profit it posted a year earlier.

But the company said that it managed to hold up despite the March 11 quake and tsunami, thanks to its growing motorcycle business. Tokyo-based Honda raised its full-year forecasts. Honda now expects a 230bn yen (£1.8bn) profit for the fiscal year ending March 2012.

That is less than half of its 534bn yen (£4.2bn) profit in the previous fiscal year, but better than the 195bn yen (£1.5bn) it forecast in June.

Honda also raised its annual sales projection to 8.7trn yen (£68.9m), which is down from the previous year, but better than the 8.3trn yen (£65.7m) it expected in June.

The manufacturer expects to sell 3.435m vehicles worldwide, some 135,000 more than it had given as its forecast in June. It sold 3.512m vehicles the previous fiscal year. Honda's motorcycle business is booming, and it expects to sell 12.7m motorcycles for the fiscal year to March 2012, up from 11.45m the previous year.

That is also better than its earlier forecast of 12.645m motorcycle sales this fiscal year.

Production at all Japan's car makers was disrupted after parts suppliers were damaged in the quake.

But they say recovery is coming quicker than expected, and production levels are projected to return to normal later this year.