Honda To Post Revenues North Of $145 Billion For FY 2019?

by Trefis Team
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According to Trefis analysis, Honda Motor Co. (NYSE: HMC) will post total revenue higher than $145 million in FY 2019 (ended March 2019).  The gross profit for the same period is expected to be around $25.5 billion. Automotive segment is expected to be the leading contributor at around $104 billion (71% of total), while the motorcycle segment and Financial services are expected to contribute $20.4 billion and $19 billion, respectively. The company in its last results of nine months (ended December 2018), posted a revenue of ¥11,839 billion ($107.7 billion) with the group recording an increase in volume of sales year-on-year across all segments for the third quarter of Fiscal year 2019.

Based on Trefis analysis, we have maintained our long-term price estimate for Honda at $32, which is around 15% ahead of the current market price. We have created an interactive dashboard on Honda’s Revenue and Gross Profit Breakdown which details our forecasts for the company in the near term. You can modify our assumptions to see the impact any changes would have on the company’s revenue and gross profit. In addition, here is more Consumer Discretionary data.

 

The increase in sales is coming from all segments. In the first nine months, the increase in motorcycle sales was led by countries like Vietnam, Indonesia, and Brazil, while the automobile sector got its growth mainly through the growth in China and Japan. We expect the volumes to have a positive growth for full year 2019.

The overall operating margin is expected to take a hit compared to last fiscal year. This has been attributed to the negative impact from the revenue and model mix, an increase in SG&A expenses, and negative FOREX effects despite the positive impact from cost reduction efforts and other factors.

 

 

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